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Big Storms, Big Debt, and Biggert-Waters:
Navigating Florida’s Uncertain Flood Insurance Future
Loren M. Vasquez†
TABLE OF CONTENTS
I. Introduction ....................................................................................... 110
II. The Federal Flood Insurance Framework ....................................... 111
A.
B.
C.

The Emergence of the National Flood Insurance Program...... 111
Implementing the NFIP ........................................................... 113
Big Storms Test the NFIP ........................................................ 116

III. The Biggert-Waters Flood Insurance Reform Act of 2012 ............ 119
A.
B.
C.

Introducing Reform to the NFIP .............................................. 119
Biggert-Waters Backlash ......................................................... 121
Homeowner Flood Insurance Affordability Act of 2014......... 124

IV. The Future of Flood Policy: Where Do We Go From Here? ......... 126
A.
B.
C.

Reform Must Reflect Current Climate Change Science .......... 127
Delaying True Reform: Is HFIAA the Right Move? ............... 129
Repeal BW-12 and HFIAA; Make Room for Private Insurance
………………………………………………………....……..131
D. Redesigning The NFIP With A Focus On Regulating Coastal
Development ..................................................................................... 133

† J.D. Candidate, Florida A&M University College of Law, May 2015. Loren M. Vasquez serves as
the Editor-in-Chief of the Florida A&M University Law Review and as a Policy & Decision Tools
Fellow for the NOAA Environmental Cooperative Science Center. This article won Second Place in
the Environmental & Land Use Law Section of the Florida Bar's 2014 Dean Maloney Writing Contest.
Mr. Vasquez would like to recognize James Graves, Kelsey Peterson, and their staff editors for their
superb editorial assistance. He would like to thank Professor Randall Abate, who supervised this
article, and Professor Robert H. Abrams, who, along with Professor Abate, supervised his work for
NOAA-ECSC and sparked his interest in Environmental Law. Special gratitude is due to his wife,
Jenna, for bringing this important issue to his attention and for tirelessly supporting him.

109

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V. Conclusion ....................................................................................... 137
I. INTRODUCTION

The National Flood Insurance Program (NFIP) began with
good intentions. It was first enacted for the purpose of making flood
insurance reasonably affordable while protecting against losses after
disasters.1 However, Congress failed to accurately update the
program in the face of climate change and new coastal development.
Because of this oversight, the overall risk associated with the
program outgrew the collection of premiums, which led to an
enormous debt to be incurred by the federal government.2 Massive
storms came and went, repeatedly increasing the program’s already
insurmountable debt.3 Storms notwithstanding, coastal development
in vulnerable areas continued.4 Eventually, to address this challenge,
the Biggert-Waters Flood Insurance Reform Act of 2012 was passed
with the general goal of updating flood maps, removing subsidies
that kept customers at the same price for decades, and increasing
premiums to accurately reflect current conditions.5
Unfortunately, the program failed to make any significant or
effective changes for many years. Once changes did finally come,
they led to massive increases in insurance rates and a massive public
outrage.6 Residents of states like Florida faced the possibility of
losing their homes because of skyrocketing insurance costs.7 As
soon as the five-year roll out of the act began, a group of senators
and representatives from both parties began to try to halt, delay, or
repeal the act.8 Eventually, delay of the reform was successful,

1. 42 U.S.C. § 4002(a)(6) (2014).
2. Dominic Spinelli, Reform of the National Flood Insurance Program: Congress Must Act
Before the Next Natural Disaster, 39 REAL EST. L.J. 430, 441 (2011).
3. Ledyard King, Rubio says he’ll vote to delay flood insurance hikes, USA TODAY, Jan. 10,
2014, 7:34 AM, http://www.usatoday.com/story/news/politics/2014/01/10/flood-insurance-floridarate-hikes/4393799/.
4. See Christine M. McMillan, Federal Flood Insurance Policy: Making Matters Worse, 44
HOUS. L. REV. 471, 497-98 (2007).
5. See Eli Lehrer, Strange Bedfellows: SmarterSafer.Org and the Biggert-Waters Act of 2012,
23 DUKE ENVTL. L. & POL'Y F. 351, 352 (2013).
6. See infra notes 124-127.
7. See Letter from Gov. Rick Scott, Florida, to President Barack Obama (Jan. 9, 2014), available
at http://www.flgov.com/2014/01/09/gov-scott-obama-failing-to-delay-nfip-law
-that-hurts-floridians-yet-delayed-healthcare-law/.
8. See Christopher Joyce, Federal Flood Insurance Program Drowning in Debt. Who will pay?,
NPR (Jan. 1, 2014), http://www.npr.org/2014/01/01/258706269/federal-flood-insurance-programdrowning-in-debt-who-will-pay.

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Big Storms, Big Debt, and Biggert-Waters

111

leading to a return to the former, unsustainable state of the NFIP.9
However, avoiding this massive problem is not a solution; this
article proposes several viable alternatives that would alleviate these
issues and solve the problems of the current NFIP.
First, an examination of the history of hurricane flooding in the
United States and its effects on Florida and other Southeastern states
is explored, which culminated in the creation of the NFIP. This is
followed by a summary of the NFIP’s organization and goals, and a
discussion of the record-breaking storms and ensuing problems that
necessitated the implementation of the Biggert-Waters Flood
Insurance Reform Act of 2012 (BW-12).
Second, a review of Biggert-Waters, its intended effects on
coastal properties, the overwhelming backlash against BW-12, and
eventual enactment of the Homeowner Flood Insurance
Affordability Act of 2014 (HFIAA), which repealed many portions
of BW-12, is presented.
Lastly, an analysis of the future of flood insurance regulation,
taking into account recent climate change reports and their
projections about storm events is presented and explored.
Considering climate change effects and the state of the NFIP,
options for the future of the program are presented. An assessment
of whether the HFIAA is a proper solution to the NFIP’s various
problems is proffered, followed by a proposal for a private flood
insurance market with mandatory participation. Finally, a solution
is offered in the form of a recommendation that the NFIP be
repurposed with an emphasis on land use regulation and retreat to
achieve the goal of preparation for and avoidance of hurricane flood
losses.
II. THE FEDERAL FLOOD INSURANCE FRAMEWORK
A. The Emergence of the National Flood Insurance Program

At 11:00 a.m. on September 6, 1965, the residents of South
Florida were placed under hurricane warning as Hurricane Betsy
was steadily making its way through the northern Bahamas. 10 After
plowing through the Bahamas, leaving behind a surprisingly low
casualty count of only one, the hurricane’s eye made its way to the
9. See Homeowner Flood Insurance Affordability Act of 2014, Pub. L. No. 113-89, 128 Stat.
1020 (2014).
10. Arnold L. Sugg, The Hurricane Season of 1965, 94 MONTHLY WEATHER REV. 183, 186
(1966), available at http://www.aoml.noaa.gov/hrd/hurdat/mwr_pdf/1965.pdf.

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Florida Keys.11 Significant flooding affected the Keys, mainly due
to the Northerly winds that preceded the storm’s center; several feet
of water flooded highways and the first floors of many buildings.12
While Betsy’s forty-mile-wide eye passed over the keys, the bands
of the 600-miles-wide storm stretched north to Fort Lauderdale.13
The noticeable damage along the Florida Atlantic Coast included
considerable flooding of beach roads and low-lying properties in
Miami, Key Biscayne, and Fort Lauderdale.14 Downtown Fort
Lauderdale, in particular, was under a foot of water due to a six-foot
storm surge with some homes on Las Olas Isles submerged during
the storm.15
Completing its course through Florida, Betsy proceeded into
the Gulf of Mexico, where it sped forward directly towards
Louisiana.16 When Betsy made landfall in Louisiana at 135 mph,17
only foundations and debris were left behind.18 Overall, around
4,800 square miles of Louisiana were flooded.19 The total cost of
damage caused by Betsy was over $1.4 billion, with over $139
million in Florida alone.20 Betsy was the first billion-dollar
hurricane.21
The compounded damages from Betsy’s attack on the Gulf
Region led to an influx of unreasonably high premiums for flood
insurance from private insurers.22 Because of the unprofitability of
underwriting flood policies, few insurance companies offered flood
insurance.23 Therefore, flood victims depended on federal taxpayerfinanced disaster programs, prompting Congress to enact the
National Flood Insurance Act of 1968 (NFIA).24 In defining the
act’s purposes, Congress found that it was not economical to burden
11. Id. at 186.
12. Id.
13. 1965: Hurricane Betsy smashes ashore near New Orleans, THE TIMES-PICAYUNE, Dec. 8,
2011, http://www.nola.com/175years/index.ssf/2011/12/1965_hurricane_betsy_smashes_a.html.
14. Sugg, supra note 10, at 187.
15. THE TIMES-PICAYUNE, supra note 13.
16. Sugg, supra note 10, at 187.
17. THE TIMES-PICAYUNE, supra note 13.
18. Id.
19. U.S. ARMY ENGINEER DISTRICT, NEW ORLEANS CORPS OF ENGINEERS, REPORT ON
HURRICANE BETSY 9 (Sept. 8-11, 1965), available at http://library.water-resources.us/docs/hpdc
/docs/19651100_Hurricane_Betsy.pdf.
20. Sugg, supra note 10, at 189.
21. THE TIMES-PICAYUNE, supra note 13.
22. Spinelli, supra note 2, at 435.
23. C.E.R. 1988 v. Aetna, 386 F.3d 263, 266 (3d Cir. 2004).
24. Spinelli, supra note 2, at 435.

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Big Storms, Big Debt, and Biggert-Waters

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the private insurance market alone in an effort to make reasonable
and affordable coverage available.25 Congress also recognized that
annual losses from floods were increasing at an “alarming rate,” and
noted that the propensity for tragic loss of life and property caused
by flooding was something the “Nation cannot afford.”26 In
addressing costly disaster relief benefits, it was noted that most of
the victims are still not adequately compensated.27
B. Implementing the NFIP

In an effort to address the problem of flood losses and costly
inadequate relief, Congress declared people already living in floodprone areas should have an opportunity to buy insurance and
adequate limits of coverage as a matter of public policy.28 Adequate
limits were deemed necessary to indemnify these people for losses
due to future flood disasters.29 The two main goals of the program
were to make flood insurance available across the nation through a
cooperative effort between the federal government and the private
insurance industry and to provide flexibility.30 A flexible program
was desired to allow for insurance to provide an effective strategy
of “pooling risks, minimizing costs, and distributing burdens
equitably” between those protected by flood insurance and members
of the general public.31 Thus, it was quite clear from the time of its
enactment that Congress intended the NFIP to be a program that
adapted to the nation’s circumstances so that it could remain viable
and effective. Other enumerated purposes of the NFIA included
increasing authorized limits of coverage, identifying flood-prone
areas, requiring state and local participation and adoption of floodplain ordinances, and requiring the purchase of flood insurance by
property owners who have received federal assistance in acquiring
or improving land in identified flood hazard areas.32
The NFIP was initially supervised by the Department of
Housing and Urban Development. Upon its establishment in 1979
to assist in disaster preparation, prevention, response, and recovery,
the Federal Emergency Management Agency (FEMA) was tasked
25. 42 U.S.C. § 4001(b) (2012).
26. 42 U.S.C. § 4002(a)(1), (a)(5) (2014).
27. Id.
28. 42 U.S.C. § 4002(a)(6).
29. 42 U.S.C. § 4002(a)(6).
30. 42 U.S.C. § 4001(d).
31. 42 U.S.C. § 4001(d).
32. 42 U.S.C. § 4002 (b).

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with administering the NFIP.33 FEMA was authorized by Congress
to prescribe methods for adjusting claims and paying for damages
to or losses of covered properties.34 As part of its administration of
the NFIP, FEMA created the Write-Your-Own (WYO) program.35
The WYO program allows private insurers to issue policies while
acting as fiscal agents of the United States.36
Under the system created by FEMA, NFIP policies may be
issued by FEMA directly or by a WYO company, with the private
company selling insurance under its own name with the federal
government as a guarantor.37 The companies serve as administrators
of policies, while the government pays out the claims;38 however,
policies may not be altered without express authorization from
FEMA.39 Although the private companies that serve as
intermediaries for WYO policies give the impression that it is
private insurance, the policies, through their rather involved FEMA
oversight, remain federal flood insurance policies. The WYO
program has gained in popularity and, as of 2004, more than 90% of
NFIP policies were WYO.40
The NFIP does condition the issuing of these flood insurance
policies. Under the NFIP, FEMA must also oversee communities’
implementation of flood zone ordinances in order to promote “sound land
use by minimizing exposure to flood losses.”41 The purposes of the flood
zone ordinances include limiting development on land exposed to flood
damage, minimizing flood damage, guiding future construction from
flood-prone areas, and authorizing ongoing studies of flood hazards to
provide for a continuing assessment of the flood insurance program and
evaluation of the program’s impact on land use requirements.42
To be eligible for NFIP coverage, structures must be in a community
that has adopted floodplain management ordinances and must follow
FEMA’s minimum standards for construction in flood-prone areas.43
FEMA must approve the building code regulations of the applying
33. Spinelli, supra note 2, at 437.
34. C.E.R. 1988 v. Aetna, 386 F.3d 263, 267 (3d Cir. 2004).
35. Id.
36. Id.
37. Peal v. N. Carolina Farm Bureau Mut. Ins. Co., Inc., 212 F. Supp. 2d 508, 513 (E.D.N.C.
2002).
38. C.E.R. 1988 v. Aetna, 386 F.3d at 267.
39. Mason v. Witt, 74 F. Supp. 2d 955, 960 (E.D. Cal. 1999).
40. Id.
41. 42 U.S.C. § 4001(c).
42. 42 U.S.C. § 4001.
43. McMillan, supra note 4, at 481.

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Big Storms, Big Debt, and Biggert-Waters

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community.44 In an effort to mitigate damage, the NFIP requires
construction in one-hundred year floodplains to be elevated higher than
the highest recorded floodwaters, prohibits development in floodways, and
specifies construction techniques.45
In addition to the mandatory requirements of the NFIP, FEMA
provides some voluntary options. FEMA has designed a Community
Rating System that recognizes and encourages community floodplain
management activities above and beyond FEMA’s requirements with the
granting of incentives.46 The incentive comes by way of discounts to
premium rates for actions that reduce flood damage, strengthen and
support the NFIP’s insurance aspects, and encourage a comprehensive
approach to floodplain management.47 Despite the regulation of land use
and the incentives from the Community Rating System, the NFIP’s land
use framework really only serves as a condition precedent for flood
insurance coverage.
However, the NFIP’s slack is picked up in some areas by the Coastal
Barrier Resources Act of 1982 (CBRA).48 CBRA serves as a direct
response to the permitting of coastal development that has resulted in the
“loss of barrier resources, threats to human life, health, and property, and
the expenditure of millions of tax dollars each year.”49 The CBRA does
not explicitly outlaw development in barrier areas, but excludes flood
coverage under the NFIP and thereby halts development in these sensitive
coastal areas.50 This statute does not necessarily have an expansive effect
on the NFIP’s issuing of policies because it is focused solely on
undeveloped coastal barriers along the Atlantic and Gulf Coasts and the
Great Lakes shores, not all flood-prone areas.51

44. Id.
45. Id. at 501. Some examples include elevating the first floor to protect development that
proceeds in the area. Id.
46. National Flood Insurance Program Community Rating System, FEMA, (Mar. 19, 2014, 1:56
PM), http://www.fema.gov/national-flood-insurance-program-community-rating-system.
47. Id.
48. 16 U.S.C. § 3501 (2014).
49. Id.
50. Martin M. Randall, Coastal Development Run Amuck: A Policy of Retreat May Be the Only
Hope, 18 J. ENVTL. L. & LITIG. 145, 159 (2003).
51. 16 U.S.C. § 3501 (2014). The act defines “undeveloped coastal barriers” as depositional
geologic features that are subject to wave, tidal, and wind energies, and protect landward aquatic
habitats from direct wave attack. § 3501. The definition also includes all associated aquatic habitats.
§ 3501.

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C. Big Storms Test the NFIP

In August 1992, the NFIP encountered a major test when
Hurricane Andrew struck South Florida and Louisiana.52 Hurricane
Andrew destroyed more than twenty five thousand homes, damaged
one hundred thousand others, killed sixty-five people, and caused
$41 billion in damage in South Florida alone.53 While greater Miami
averted major damage, the storm introduced to South Florida
citizens and governmental officials the potential destruction that a
storm like Hurricane Andrew could leave in its path.54 Decades of
minimal hurricanes and tropical storms made Hurricane Andrew a
wakeup call for South Florida's coastal residents.55 It was estimated
that major damage to South Florida might have tripled Hurricane
Andrew's immense cost.56 Hurricane Andrew’s intensity, power,
and sustained force over land were much greater than calculated.57
Hurricane Andrew was the most expensive natural disaster in
U.S. history for thirteen years.58 While the NFIP somehow managed
to keep afloat after 1968 and survive Hurricane Andrew, nothing
could have prepared the program and FEMA for the 2005 hurricane
season. A few short months after Hurricane Dennis reached the
Florida panhandle as a Category 3 storm, Tropical Storm Katrina
became Hurricane Katrina just off the coast of the MiamiDade/Broward County line on August 25, 2005.59 Hurricane Katrina
crossed Florida over the following day, entering the Gulf of Mexico
and gaining strength to become a Category 5 by August 28.60
On August 29, Hurricane Katrina’s center made landfall in
Louisiana, bringing with it a maximum wind speed that was
estimated at 125 mph.61 Hurricane Katrina made a second landfall
near the Mississippi/Louisiana border and led to storm surge
52. John Kostyack, Reforming the National Flood Insurance Program to Confront Global
Warming and Other Environmental Realities: A Win-Win for People and Wildlife, 40 NO. 2 ABA
TRENDS 12, 13 (2008).
53. Id.
54. Jonathan Brennan Butler, Insurers Under Fire: Assessing the Constitutionality of Florida's
Residential Property Insurance Moratorium After Hurricane Andrew, 22 FLA. ST. U. L. REV. 731, 732
(1995).
55. Id.
56. Id.
57. Id.
58. Kostyack, supra note 52, at 13.
59. Hurricanes in History: Hurricane Katrina 2005, NATIONAL HURRICANE CENTER,
http://www.nhc.noaa.gov/outreach/history/#katrina (last modified May 30, 2012).
60. Id.
61. Id.

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Big Storms, Big Debt, and Biggert-Waters

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flooding of twenty-five to twenty-eight feet above normal tide levels
along the Mississippi coast and storm surge flooding of ten to twenty
feet above normal tide levels along the Louisiana coast.62 South
Florida collected ten to fourteen inches of rain, while the rest of the
inland track along the Gulf received eight to twelve inches of rain.63
Hurricane Katrina left behind over $81 billion in damages, making
it the costliest storm in United States history.64 Additionally,
Hurricane Katrina’s death toll neared approximately 1,830, making
it one of the deadliest storms in the nation’s history. 65
No more than a month later, a Category 3 hurricane named Rita
made landfall on the Texas/Louisiana border, resulting in
approximately $11.68 billion in damage and 120 casualties.66
Hurricane Rita devastated portions of Texas and Louisiana, after
first impacting the Florida Keys.67 Still, there was more to come, as
Hurricane Wilma caused $30 billion in damages and 63 casualties
exactly one month after Hurricane Rita.68
However, no matter how fearsome the 2005 hurricane season
was, coastal residents in the Gulf Region were not frightened away.
In 2006, speaking to the New York Times, Philip J. Klotzbach, a
hurricane researcher at Colorado State University, said, “[t]here is
likely to be an increase in destructiveness from tropical cyclones
regardless of whether they are getting more intense or not . . . largely
due to the increase in coastal population and wealth per capita in
hurricane-prone areas.”69 Professor Klotzbach and other climate
experts stated that the main hurricane problem facing the United
States was unabated coastal development in vulnerable places,
which was supported by a failure to change government policies and
corporate and individual behavior.70 At the time, Gulf and Atlantic
coastal construction was still going strong.71
62. Id.
63. Id.
64. Kimberly E. Smith, The Go Zone Act: An Innovative Mechanism for Promoting Economic
Recovery for the Gulf Coast, 77 MISS. L.J. 807, 809 (2008).
65. Id.
66. Id.
67. Hurricanes in History: Hurricane Rita 2005, NATIONAL HURRICANE CENTER,
http://www.nhc.noaa.gov/outreach/history/#rita (last modified May 30, 2012).
68. Smith, supra note 64, at 809.
69. Andrew C. Revkin, Climate Experts Warn of More Coastal Building, N.Y. TIMES, July 25,
2006.
70. Id.
71. An Examination of the Availability and Affordability of Property and Casualty Insurance in
the Gulf Coast and Other Coastal Regions: Hearing Before the S. Comm. on Banking, Housing and


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