Document ID: FEMA-2021-0021-0001
Agency: fema
Document Type: Notice
Title: Request for Information: National Flood Insurance Program's Community Rating System
Posted Date: 2021-08-23T04:00Z

[Federal Register Volume 86, Number 160 (Monday, August 23, 2021)]
[Notices]
[Pages 47128-47131]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18167]

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

[Docket ID: FEMA-2021-0021]

Request for Information on the National Flood Insurance Program's 
Community Rating System

AGENCY: Federal Emergency Management Agency, Department of Homeland 
Security (DHS).

ACTION: Notice and request for information.

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SUMMARY: The Federal Emergency Management Agency (FEMA) is issuing this 
Request for Information (RFI) to receive input from the public on 
transforming the Community Rating System (CRS) under the National Flood 
Insurance Program (NFIP) to better align with the current understanding 
of flood risk and flood risk approaches and to incentivize communities 
to not only manage but also lower their flood risk through floodplain 
management initiatives. The NFIP's CRS program is a voluntary incentive 
program that recognizes and encourages community floodplain management 
practices that exceed the minimum requirements of the NFIP for 
floodplain management. As FEMA undertakes a series of initiatives that 
will transform the NFIP, the agency is evaluating the CRS program and 
its potential to support FEMA, State, local, Tribal, and Territorial 
community goals and needs.

DATES: Written comments are requested on or before September 22, 2021. 
Late-filed comments will be considered to the extent practicable.

ADDRESSES: You may submit comments, identified by Docket ID: FEMA-2021-
0021, through the Federal eRulemaking Portal: http://www.regulations.gov. Follow the instructions for submitting comments. 
Please note that this RFI period is not rulemaking and the Federal 
Rulemaking Portal is being utilized only as a mechanism for receiving 
comments.

FOR FURTHER INFORMATION CONTACT: Rachel Sears, Supervisory Emergency 
Management Specialist, Federal Insurance and Mitigation Administration, 
Federal Emergency Management Agency, FEMA-CRS-Next@fema.dhs.gov, 202-
212-3800.

SUPPLEMENTARY INFORMATION:

I. Public Participation

    Interested persons are invited to comment on this notice by 
submitting written data, views, or arguments using the method 
identified in the ADDRESSES section.
    Instructions: All submissions must include the agency name and 
Docket ID for this notice. All comments received will be posted without 
change to http://www.regulations.gov. Commenters are encouraged to 
identify the number of the specific question or questions to which they 
are responding.
    Docket: For access to the docket to read background documents or 
comments received, go to http://www.regulations.gov and search for the 
Docket ID.

II. Background

    Floods are the most common and most destructive natural disaster in 
the United States.\1\ Every year, flooding causes hundreds of millions 
of dollars in damage to homes and businesses around the United 
States.\2\ Anywhere it can rain, it can flood. With 99% of counties in 
the United States having experienced a flood \3\ and when just one inch 
of water can cause $25,000 in damage in a home,\4\ communities across 
the country must make difficult decisions about protecting lives and 
property from flooding.
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    \1\ See Ready Campaign, Floods (updated Apr. 9, 2021) at http://www.ready.gov/floods (last accessed July 15, 2021). See also 
National Weather Service, Flood Related Hazards at http://www.weather.gov/safety/flood-hazards (``Approximately seventy-five 
percent of all Presidential disaster declarations are associated 
with flooding.'') (last accessed July 15, 2021).
    \2\ See Billion-Dollar Weather and Climate Disasters: Summary 
Stats, at http://www.ncdc.noaa.gov/billions/summary-stats (last 
accessed July 7, 2021).
    \3\ See Historical Flood Risk and Costs at http://www.fema.gov/data-visualization/historical-flood-risk-and-costs (last accessed, 
July 9, 2021)
    \4\ See Why Buy Flood Insurance at http://www.floodsmart.gov/flood-insurance/why (last accessed July 1, 2021).
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    Standard homeowners and commercial property insurance policies do 
not cover flood losses. To meet the need for this vital coverage, FEMA 
administers the National Flood Insurance Program (NFIP), which offers 
reasonably priced flood insurance to all properties in communities that 
comply with minimum standards for floodplain

[[Page 47129]]

management. To be covered by an NFIP flood insurance policy, a property 
must be in a community that participates in the NFIP. To qualify for 
the NFIP, a community adopts and enforces a floodplain management 
ordinance to regulate development in flood hazard areas.\5\ The 
objective of the ordinance is to minimize the potential for flood 
damage to future development. Today, over 22,500 communities in the 
United States participate in the NFIP.\6\
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    \5\ 44 CFR 59.2(b).
    \6\ See The Watermark--National Flood Insurance Program 
Financial Statements found at: http://www.fema.gov/flood-insurance/work-with-nfip/watermark-financial-statements (last accessed July 
27, 2021).
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    In 1990, FEMA implemented the Community Rating System (CRS) as a 
voluntary program for recognizing and encouraging community floodplain 
management activities exceeding the minimum NFIP standards and the CRS 
program was fully authorized by the National Flood Insurance Reform Act 
of 1994.\7\ Any community \8\ in full compliance with the minimum NFIP 
floodplain management requirements may apply to join the CRS program. 
Through the CRS program, communities undertaking floodplain management 
activities that exceed the minimum floodplain management requirements 
of the NFIP earn CRS credits (often referred to as ``points'') that 
result in flood insurance premiums discounts for NFIP policyholders who 
reside in that community. As of April 2021, over 1,500 communities 
participate in the CRS program nationwide. This represents about seven 
percent of eligible NFIP communities that could participate in the CRS 
program. However, these communities have a large number of NFIP flood 
insurance policies--nearly 3.6 million--so more than 70 percent of all 
NFIP policies are written in communities participating in the CRS 
program.\9\
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    \7\ Public Law 103-325, 108 Stat. 2255 (1994).
    \8\ ``Community'' means any State or area or political 
subdivision thereof, or any Indian tribe or authorized tribal 
organization, or Alaska Native village or authorized native 
organization, which has authority to adopt and enforce flood plain 
management regulations for the areas within its jurisdiction. 44 CFR 
59.1.
    \9\ FEMA, Community Rating System Fact Sheet, June 2021, at 
http://www.fema.gov/fact-sheet/community-rating-system (last 
accessed July 12, 2021).
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    The CRS program credits community efforts that exceed the minimum 
standards by reducing flood insurance premiums for the community's 
policyholders. The CRS program is similar to, but separate from, the 
private insurance industry's programs that grade communities on the 
effectiveness of their fire suppression and building code enforcement 
efforts. CRS program discounts on flood insurance premiums range from 5 
percent up to 45 percent based on the level of CRS program credits 
awarded to communities. The discounts provide an incentive for 
communities to implement new flood protection activities that help save 
lives and property when a flood occurs and correlate to FEMA's expected 
savings for these local floodplain activities.
    To participate in the CRS program, local floodplain management 
actions must be described, measured, and evaluated by the CRS program. 
The CRS program assigns credits for defined activities. Most activities 
are optional; however, some activities are required to achieve higher 
Classes. A higher-Class community achieves higher levels of discount; a 
Class 1 community achieves the highest discount of 45 percent. The 
basic documents detailing the program are the NFIP Community Rating 
System Coordinator's Manual (known as the ``CRS Coordinator's Manual'') 
and the 2021 Addendum to the NFIP Community Rating System Coordinator's 
Manual (known as the ``2021 Addendum'').\10\ Taken together, these 
documents set forth the procedures, creditable activities, and the 
credit assigned to each activity, and give examples of activities and 
how their credit is calculated.
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    \10\ Includes both the FEMA, NFIP Community Rating System 
Coordinator's Manual, at http://www.fema.gov/sites/default/files/documents/fema_community-rating-system_coordinators-manual_2017.pdf, 
and the 2021 Addendum to the NFIP Community Rating System 
Coordinator's Manual, at http://www.fema.gov/sites/default/files/documents/fema_community-rating-system_coordinator-manual_addendum-2021.pdf. (last accessed July 1, 2021).
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    The discounts on premium rates for NFIP flood insurance coverage 
are based on flood and erosion risk reduction measures implemented by a 
CRS community.\11\ The CRS program provides credit to participating 
communities under 19 public information and floodplain management 
activities as described in the CRS Coordinator's Manual. To receive 
credit, community officials prepare documentation that verifies the 
efforts made under the 19 activities. The CRS program activities 
include but are not limited to: (1) Public information to advise people 
about flood hazards, flood insurance, and ways to reduce flood damage; 
(2) mapping and regulations to limit floodplain development or provide 
increased protection to new and existing development; (3) flood damage 
reduction; and (4) flood preparedness to provide flood warning, levee 
safety, and dam safety projects.
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    \11\ See 2017 CRS Coordinator's Manual, Appendix D found at 
http://www.fema.gov/sites/default/files/documents/fema_community-rating-system_coordinators-manual_2017.pdf.
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    Based on the total number of credits a community earns, the CRS 
program assigns the community to one of ten different Classes. The 
community will then receive flood insurance discounts based on the 
community's Class. For example, a community earning 4,500 credits or 
more qualifies for Class 1, and property owners in the Special Flood 
Hazard Area (SFHA) receive a 45 percent discount on their NFIP flood 
insurance premiums. Similarly, a community with as few as 500 credits 
will be in Class 9 and property owners in the SFHA receive a 5 percent 
discount. Communities may receive additional credit for regulating 
development outside the SFHA to the same standards as inside the SFHA. 
Credits are also available for assessing future flood conditions, 
including the impacts of future development, urbanization, and climate 
change impacts including sea-level rise. Additionally, communities can 
qualify for ``State-based credit'' based on the activities or 
regulations a State or regional agency implements within communities. A 
community that does not participate in the CRS program, or does not 
obtain the minimum number of credit points, is a Class 10 community and 
receives no discount on NFIP flood insurance premiums.
    FEMA is seeking input on ways the agency can improve the CRS 
program: (1) To better align the CRS program with the improved 
understanding of flood risk and flood risk approaches that have 
developed since the program's inception; (2) to better incentivize 
communities and policyholders to become more resilient and to not only 
manage, but to lower their vulnerability to flood risk; and (3) to 
support the sound financial framework of the NFIP.
    While the CRS program today has evolved, the overall approach and 
framework of the program has been the same since the start of the 
program. As FEMA undertakes many initiatives that will transform the 
NFIP, the agency is also evaluating the CRS program and its potential 
to support FEMA, State government, Tribal government, Territorial and 
community goals and needs. While the agency has made incremental 
changes since the CRS program's implementation, the agency is seeking 
input to improve the program further through additional programmatic 
changes. With the continuous learning around flood, flood risk 
management, and flood risk reduction techniques, FEMA now has more 
information about and

[[Page 47130]]

understanding of multi-frequency analysis, pluvial flooding, climate 
change, and the extent of flood risk outside of the SFHA. FEMA seeks to 
make larger improvements within our programs based on these 
developments and is now taking a holistic look at the CRS program to 
determine how the program can best meet FEMA and stakeholder needs.
    As FEMA reviews the CRS program, several foundational assumptions 
underpin this programmatic review and improvement effort (called ``CRS 
Next''), including that the CRS program will continue to provide whole-
community public benefits through a rewards-based program; the CRS 
program will continue to increase both the visibility of comprehensive 
flood risk and recognition of actions taken by a community; the CRS 
program will support and contribute to the financial soundness of the 
NFIP; the CRS program will be simpler for communities to join and 
participate in; the CRS program will be simpler for FEMA to explain to 
communities and also for communities to explain to their constituents; 
the CRS program will clarify that it does not address structure-based 
risk reduction activities; and FEMA will avoid duplication between the 
approaches of the CRS program and other NFIP Transformation efforts.
    FEMA is also further reviewing the CRS program in light of recent 
Executive orders focused on equity, climate change, and environmental 
justice. FEMA recently sought input through another Request for 
Information pursuant to the processes required by Executive Orders 
13985, 13990, and 14008 \12\ that require agencies to assess existing 
programs and policies to determine if: (1) Agency programs and policies 
perpetuate systemic barriers to opportunities and benefits for people 
of color and other underserved groups; (2) additional agency actions 
are required to bolster resilience to climate change; and (3) agency 
programs, policies, and activities address the disproportionately high 
and adverse climate-related impacts on disadvantaged communities.\13\ 
The input received from that Request for Information will also be used 
to assist FEMA's initiative to improve and update the CRS program. 
Additional comments on equity related to CRS may also be provided 
through this RFI.
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    \12\ See ``Advancing Racial Equity and Support for Underserved 
Communities Through the Federal Government,'' 86 FR 7009 (Jan. 25, 
2021); ``Protecting Public Health and the Environment and Restoring 
Science to Tackle the Climate Crisis,'' 86 FR 7037 (Jan. 25, 2021); 
and ``Tackling the Climate Crisis at Home and Abroad,'' 86 FR 7619 
(Feb. 1, 2021).
    \13\ Request for Information on FEMA Programs, Regulations, and 
Policies, 86 FR 21325 (April 22, 2021).
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    FEMA continually evaluates its programs, regulations, and policies, 
to identify opportunities to modify, streamline, expand, or repeal. 
FEMA does so through legally mandated review requirements (e.g., 
Unified Agenda reviews and reviews under section 610 of the Regulatory 
Flexibility Act) and through other informal and long-established 
mechanisms (e.g., use of Advisory Councils, feedback from FEMA field 
personnel, input from internal working groups, and outreach to 
regulated entities and the public). This Federal Register notice 
supplements these existing extensive FEMA regulatory and program review 
efforts.

II. Request for Input

A. Importance of Public Feedback

    FEMA is committed to obtaining public input to drive and focus 
FEMA's review of the CRS program. Because Federal regulations and 
policies have broad impacts on society in general, members of the 
public are likely to have useful information, data, and perspectives on 
the benefits and burdens of FEMA's existing programs, regulations, 
information collections, and policies. Accordingly, FEMA is seeking 
specific public feedback to facilitate the CRS program review and 
improvement efforts in the context of equity for all, including those 
in underserved communities. With the increasing risk of flooding and 
flood damage, in part because of climate change, it is essential that 
FEMA reevaluate programs to reduce unnecessary barriers to 
participation and effectiveness, to serve all communities, to increase 
equity, and to promote preparedness.

B. Maximizing the Value of Public Feedback

    This notice contains a list of questions, the answers to which will 
assist FEMA in identifying those aspects of the CRS program that may 
benefit from modification, streamlining, or expansion. FEMA encourages 
public comment on these questions and seeks any other data commenters 
believe are relevant to FEMA's efforts. The type of feedback that is 
most useful to the agency will identify specific CRS program components 
that could benefit from reform; refer to specific barriers to 
participation; align the CRS program with the improved understanding of 
flood risk and flood risk reduction approaches gained since the 
initiation of the program; better incentivize communities and 
policyholders to become more resilient and lower their vulnerability to 
flood risk; offer actionable data; and specify viable alternatives to 
existing approaches that meet statutory obligations.
    For example, feedback that contains specific information explaining 
a proposed change to the CRS program, how such a change could be 
implemented, and why said change would be beneficial (i.e., the 
outcomes a proposed change would aim to effect) is more useful to FEMA 
than generic feedback that omits these components. FEMA is looking for 
new information and new data to support any proposed changes.
    Commenters should consider these principles as they answer and 
respond to the questions in this notice.
     Commenters should identify, with specificity, the CRS 
program policy or process at issue.
     Commenters should explain, with as much detail as 
possible, why an aspect of the CRS program should be modified, 
streamlined, expanded, or repealed, and provide specific suggestions of 
ways the agency can better achieve its objectives.
     Commenters should provide specific data that document the 
costs, burdens, and benefits of existing requirements to the extent 
they are available. Commenters might also address how FEMA can best 
obtain and consider accurate, objective information and data about the 
costs, burdens, and benefits of the CRS program and whether there are 
existing sources of data that FEMA can use to evaluate the effects of 
the CRS program over time.
     Commenters should identify with specificity administrative 
burdens, CRS program requirements, information collection burdens, 
waiting time, or unnecessary complexity that may impose unjustified 
barriers in general, or that may have adverse effects on equity for 
all, including those in underserved communities. This Request for 
Information and change effort aligns with broader FEMA efforts to 
solicit public comments on FEMA Programs, Regulations, and Policies. 
FEMA is seeking additional information specific to the CRS program and 
the CRS Next change effort on the topics of equity for all, including 
those in underserved communities. Commenters seeking to provide input 
on these areas should respond to the questions below in this Request 
for Information.
     Commenters should identify with specificity small or large 
reforms that might be justified in light of the risks posed by climate 
change, including but not limited to sea-level rise, intense

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rainfall, changing weather patterns, riverine and coastal erosion, and 
shifts in future development.
     Particularly where comments relate to the CRS program's 
costs or benefits, comments will be most useful if there are data and 
experience under the program available to ascertain the program's 
actual impact.

C. List of Questions for Commenters

    The below non-exhaustive list of questions is meant to assist 
members of the public in the formulation of comments and is not 
intended to restrict the issues that commenters may address:
    (1) What are the strengths of the current CRS program? What 
components of the program are currently working well and why?
    (2) What are the challenges with the current CRS program that need 
to be addressed and why? How can the CRS program be modified, expanded, 
or streamlined to better address or resolve these challenges?
    (3) While the CRS program is technically available to all compliant 
NFIP communities, is access to the CRS program equitable for all 
communities? If not, what changes to the CRS program could make it more 
equitable for all communities? How could the CRS program provide better 
outreach to disadvantaged communities to encourage participation? How 
could the CRS program provide better outreach to households in 
disadvantaged communities to encourage participation in the NFIP?
    (4) How could the CRS program better promote and/or incentivize 
improved reduction of future conditions and risks such as climate 
change, sea-level rise, urban flooding, and future development?
    (5) How could the CRS program better address the mitigation of 
repetitive loss/severe repetitive loss \14\ properties and how could 
FEMA further leverage the CRS program to achieve mitigation of 
repetitive loss/severe repetitive loss properties?
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    \14\ ``Repetitive loss properties'' are those properties for 
which two or more claims of more than $1,000 have been paid by the 
NFIP within any 10-year period since 1978. ``Severe repetitive loss 
properties'' are those as defined in the Flood Insurance Reform Act 
of 2004 that are one-four family properties that have had four or 
more claims of more than $5,000 or two to three claims that 
cumulatively exceed the building's value. CRS considers non-
residential buildings that also meet these criteria to be severe 
repetitive loss properties. See National Flood Insurance Program 
Community Rating System Coordinator's Manual 2017 and National Flood 
Insurance Program Community Rating System Addendum to the 2017 CRS 
Coordinator's Manual at https://www.fema.gov/floodplain-management/community-rating-system (last accessed May 20, 2021).
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    (6) How can the CRS program be modified, expanded, or streamlined 
to best incentivize participation by communities and flood insurance 
policyholders to become more resilient and lower their vulnerability to 
flood risk?
    (7) How can the CRS program better incentivize floodplain 
management, risk management, and/or risk reduction efforts for 
communities through CRS discounts, grants, trainings, technical 
assistance or other means? Which efforts are most critical for the CRS 
program to support?
    (8) What existing sources of data can FEMA leverage to better 
assist communities to assess, communicate, and drive the reduction of 
current and future flood risk? Can FEMA leverage new technologies to 
modify or streamline the CRS program? If so, what are they and how can 
FEMA use new technologies to achieve the statutory objectives of the 
program?
    (9) The CRS program provides credits for flood risk reduction 
activities. Are there flood risk reduction activities that are not 
currently given credit within the CRS program that should be? If so, 
what are they and why? Are there flood risk reduction activities that 
are currently given excessive credit within the CRS program than they 
should be given? If so, what are they and why? Should the CRS program 
provide a list of optional risk reduction activities for communities to 
choose from or a list of required risk reduction activities, and why?
    (10) What successful approaches have been taken by State, local, 
Tribal, and Territorial governments that the CRS program could leverage 
to better support community participation in the CRS program? In what 
ways could the CRS program better support States, Tribes, Territories 
and Regions, and flood control and water management districts to 
improve community participation in the program? What innovative changes 
could the CRS program make to be simpler for communities to join and 
maintain participation?
    (11) How could the CRS program provide better outreach to 
disadvantaged communities to encourage participation? How could the CRS 
program provide better outreach to households in disadvantaged 
communities to encourage participation in the NFIP?
    (11) In what ways could the CRS program facilitate collaboration 
across jurisdictional boundaries to support a community's ability to 
reduce flood risk? How could the CRS program be modified, expanded, or 
streamlined to allow for multi-jurisdictional collaboration efforts to 
receive credit under the CRS program?
    (12) What opportunities exist for the CRS program to better 
integrate with other entities and/or programs? For example, in what 
specific ways could the CRS program better work and integrate with 
State, local, Tribal, and Territorial programs, including but not 
limited to, floodplain management, emergency services, land use 
planning and building code administration capital improvement, 
transportation, redevelopment, pre- and post-disaster recovery, climate 
adaptation, hazard mitigation planning, watershed management, and/or 
wetlands, riparian, or environmental management programs? In what 
specific ways could the CRS program better work and integrate with 
Federal disaster assistance programs or Federal mitigation programs?
    FEMA notes that this notice is issued solely for information and 
program-planning purposes. Responses to this notice do not bind FEMA to 
any further actions related to the response.

Deanne Criswell,
Administrator, Federal Emergency Management Agency.
[FR Doc. 2021-18167 Filed 8-20-21; 8:45 am]
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