[Federal Register Volume 74, Number 178 (Wednesday, September 16, 2009)]
[Rules and Regulations]
[Pages 47471-47483]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-22278]
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DEPARTMENT OF HOMELAND SECURITY
Federal Emergency Management Agency
44 CFR Parts 59, 61, 78, 79, 80, 201, and 206
[Docket ID FEMA-2006-0010]
RIN 1660-AA36
Flood Mitigation Grants and Hazard Mitigation Planning
AGENCY: Federal Emergency Management Agency, DHS.
ACTION: Final rule.
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SUMMARY: The Federal Emergency Management Agency finalizes the interim
regulations that implemented the Severe Repetitive Loss program and
clarified provisions of the existing Flood Mitigation Assistance
program. In addition, this rule finalizes interim requirements for the
acquisition of property for open space with mitigation funds and
clarifies mitigation planning requirements for Indian Tribal
governments. This rule is intended to encourage hazard mitigation,
reduce the number of repetitive loss properties, and improve FEMA's
mitigation programs.
DATES: This rule is effective October 16, 2009.
FOR FURTHER INFORMATION CONTACT: Cecelia Rosenberg, Mitigation
Directorate, Federal Emergency Management Agency, 1800 South Bell
Street, Arlington, VA 20598-3030, (phone) 202-646-3321, (facsimile)
202-646-2719, or (e-mail) [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
On October 31, 2007 (72 FR 61720), the Federal Emergency Management
Agency (FEMA) published an Interim Rule (IR). The IR implemented
provisions of the Bunning-Bereuter-Blumenauer Flood Insurance Reform
Act of 2004, Public Law 108-264, 118 Stat. 714, found at 42 U.S.C.
4102a, which amended the National Flood Insurance Act of 1968 (NFIA) to
provide new programs and incentives for States and communities to
mitigate flood damage to severe repetitive loss properties. Using this
new authority, the IR added a new 44 CFR part 79 that established the
new Severe Repetitive Loss (SRL) program. The SRL program is intended
to eliminate or reduce the risk of additional flood damage to the
subset of properties that have the largest claims paid from the
National Flood Insurance Program (NFIP). It is also intended to reduce
losses to the National Flood Insurance Fund (NFIF). The SRL program
provides mitigation offers for NFIP insured properties that have
experienced four or more separate flood claims payments each exceeding
$5,000 and cumulative payments exceeding $20,000; or at least two
separate claims payments cumulatively exceeding the market value of the
building. Claims made within 10 days of each other are counted as one
claim, and at least two of the claims must be within 10 years of each
other. If the offer of mitigation assistance is refused the property
owners' insurance rates may be increased.
In addition, the IR amended the existing Flood Mitigation
Assistance (FMA) program by updating the FMA regulations to reflect
changes to the non-Federal cost share as a result of the amendments to
the NFIA, changes to FEMA policy, and adding a new 44 CFR part 79. The
IR also codified, at new 44 CFR part 80, procedures and requirements
for the acquisition of property for open space. Although FEMA
previously had procedures in place for open space acquisition, the new
part expanded the scope of FEMA's prior regulations to address the use
of all types of mitigation funds, including SRL and FMA, and
consolidated them in one location. FEMA also modified the mitigation
planning regulations at 44 CFR part 201 to reduce the non-Federal cost
share for mitigation projects under the FMA and SRL programs for
grantees with State mitigation plans that address repetitive loss
strategies. This change is intended to minimize the burden on State,
local, and Indian Tribal governments; to streamline the flood
mitigation planning process; and to ensure consistency in the local
planning requirements that apply to FEMA's mitigation grant programs.
Recognizing the unique needs of Indian Tribal governments, who may act
as grantees or subgrantees and may have different organizational
structures than State or local governments, the IR also established the
Tribal Mitigation Plan in 44 CFR 201.7.
The rule also implemented amendments to section 1308 of the NFIA to
charge the full actuarial insurance premium rates for property leased
from the Federal Government ``located on the river-facing side of any
dike, levee, or other riverine flood control structure, or seaward of
any seawall or other coastal flood control structure.'' (42 U.S.C.
4015(c)(2)) Finally, effective October 4, 2006, section 684 of the
Post-Katrina Emergency Management Reform Act of 2006, Public Law 109-
295, amended the amount of Hazard Mitigation Grant Program (HMGP)
assistance available to States with an approved Standard State
Mitigation Plan from 7.5 percent to 15 percent and established a
sliding scale for HMGP assistance. The IR revised FEMA's regulations to
align with this change. (44 CFR 206.432(b)(1).)
II. Discussion of Final Rule
This final rule adopts the regulations established by the October
31, 2007 IR. It addresses the comments received from the public in
response to the IR, makes changes to correct errors identified in
public comments, makes technical corrections, and finalizes the interim
regulations contained in 44 CFR parts 59, 61, 78, 79, 80, 201, and 206.
The following is a summary of these regulatory changes:
A. 44 CFR Part 79
FEMA revised ``Alaskan native village'' in paragraph 79.2(c)(1) to
``Alaska Native village'' so that the term is consistent with its use
under the definition of ``local government'' in the Robert T. Stafford
Disaster Relief and Emergency Assistance Act (Stafford Act), as amended
(42 U.S.C. 5122). FEMA also inserted a definition of ``Indian Tribal
Government'' at new paragraph 79.2(e) so that 44 CFR part 79 is
consistent with 44 CFR parts 201 and 206 where ``Indian Tribal
government'' is currently defined. Throughout paragraph 79.4(c), FEMA
removed the word ``State'' and revised the text to recognize that per
44 CFR 206.202(f)(1), Indian Tribal governments may also apply directly
to FEMA for grant assistance. These changes are intended to correct an
unintentional omission in the language of the IR. A technical
correction has also been made to paragraph 79.6(b)(1) to add a more
specific reference to Tribal mitigation planning requirements. Finally,
paragraph 79.6(c)(2)(ii) of the IR inadvertently listed demolition or
relocation of structures to areas outside of the floodplain as an
eligible activity, rather than as a component of paragraph
79.6(c)(2)(i). To correct this error, paragraph 79.6(c)(2)(ii) has been
removed and its substance has been incorporated into the language of
paragraph 79.6(c)(2)(i).
Finally, on April 3, 2009, FEMA published a technical amendment
that updated the agency's titles to reflect its current organization
(74 FR 15328). Among other things, the technical amendment changed the
terms ``Director'' to ``Administrator'' and ``Regional Director'' to
``Regional Administrator'' throughout Title 44 of the Code of Federal
Regulations, and
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removed the agency organization and delegations of authority from 44
CFR part 2. The IR had inserted definitions for ``Administrator'' and
``Regional Administrator'' at 44 CFR parts 79, 80, and 201 to reflect
the agency organization; however, it did so in a way that referenced
the old terms ``Director'' and ``Regional Director'' as defined in 44
CFR part 2. To ensure this final rule conforms to the changes made in
the technical amendment, the definitions for ``Administrator'' and
``Regional Administrator'' are revised in newly designated paragraphs
79.2(l) and (m), paragraphs 80.3(l) and (m), and also revised in Sec.
201.2.
B. 44 CFR Part 80
FEMA revised paragraph 80.11(d) to clarify that the subapplicant
must acquire or retain fee title (full property interest), except for
encumbrances FEMA determines are compatible with open space uses,
consistent with paragraph 80.17(b). In response to a comment, FEMA
reviewed the provisions for verifying that a property owner is a
National of the United States or qualified alien and therefore eligible
to be offered pre-event market value for the property in an acquisition
instead of current market value. To correct an inconsistency confirmed
in that review, FEMA revised paragraphs 80.13(a)(6) and 80.17(c)(4) to
require the subapplicant to certify that the property owner is a U.S.
National or qualified alien before the grant award.
C. 44 CFR Part 201
The final rule makes technical corrections throughout this part. In
the definition of the term ``Indian Tribal government'' in Sec. 201.2,
the word ``Indian'' was inadvertently omitted in the reference to the
Federally Recognized Indian Tribe List Act of 1994, but has been added
in this final rule. The final rule removes paragraph 201.3(c)(7) to
eliminate reference to a paragraph of the regulation that no longer
exists, as it was transitional in nature. In paragraphs 201.3(e)(1),
201.7(a)(2) and 201.7(c)(3)(vi), FEMA inadvertently failed to reference
that Indian Tribal governments, like States, must apply to FEMA as a
grantee to receive the reduced cost share for the FMA and SRL programs
when addressing severe repetitive loss properties in their plans. This
requirement appeared in paragraph 201.3(e) before 44 CFR part 201 was
changed by the IR; therefore, these changes are nonsubstantive.
FEMA has revised paragraph 201.7(a)(3) by replacing local with
Tribal to reflect the appropriate mitigation plan required for Tribal
governments. Additionally, FEMA added a sentence to the end of
paragraph 201.7(a)(3) to reference the extraordinary circumstances in
which a Regional Administrator may grant Tribal governments an
exception to the plan requirement. This exception appeared in FEMA's
regulations before the IR at paragraph 201.6(a)(3) and was
unintentionally omitted from the new language specifically addressing
Tribal governments in the IR.
Finally, in paragraph 201.6(c)(2)(ii)(B), an incorrect cross-
reference has been revised from (c)(2)(i)(A) to (c)(2)(ii)(A). In
paragraph 201.6(c)(3)(iii), an incorrect cross-reference has been
revised from (c)(2)(ii) to (c)(3)(ii). In paragraph 201.7(c)(2)(ii)(B),
an incorrect cross-reference has been revised from (c)(2)(i)(A) to
(c)(2)(ii)(A) and in paragraph 201.7(c)(3)(iii), an incorrect cross-
reference has been revised from (c)(2)(ii) to (c)(3)(ii).
D. 44 CFR Part 206
This final rule makes two technical corrections to Sec. 206.432.
The first technical correction is to paragraph 206.432(b) and removes
the reference to 42 U.S.C. 5178 since 42 U.S.C. 5178, section 411 of
the Stafford Act was repealed. The second technical correction is to
paragraph 206.432(b)(2) to clarify that for States with an Enhanced
State Mitigation Plan, the total amount of Federal contribution under
the HMGP for a major disaster may not exceed 20 percent of $35.333
billion. This technical correction is non-discretionary and makes the
paragraph consistent with the statute (sections 322 and 404 of the
Stafford Act, as amended, 42 U.S.C. 5165 and 5170c).
This final rule also corrects inadvertent errors and omissions to
reflect the Tribal Mitigation Plan established by the IR. The rule adds
the word ``Indian'' to the definition of ``Indian Tribal government''
in Sec. 206.431 and ``or Tribal'' to paragraphs 206.434(b)(1) and
206.434(c)(1), deletes the words ``or Indian Tribal'' from the
definition of Local Mitigation Plan in Sec. 206.431, and adds a
definition of the term ``Tribal Mitigation Plan'' to Sec. 206.431.
In paragraph 206.434(b)(1), the final rule expands the reference to
44 CFR 201.6 and revises it to include the entirety of 44 CFR part 201
so that it includes both Local and Tribal Mitigation Plans. In that
paragraph, the final rule also removes the reference to disasters
declared on or after November 1, 2004, and the requirements for plans
approved before that date. This change is a conforming amendment
because the provisions are no longer applicable. Additionally, the
final rule revises the cross-reference in Sec. 206.401 to correctly
direct readers to paragraph 206.226(d). Paragraph 206.226(b) is revised
to include the Tribal Mitigation Plan established by the IR. As FEMA
treats Tribal Mitigation Plans in the same manner that it treats State
Mitigation Plans, this section should have been amended in the IR to
reflect the new form of planning document. These changes are intended
to correct that omission and conform this section to the requirements
and authorities contained in other sections.
Finally, the introductory text to paragraph 206.434(e) has been
restated in this rule. As previously noted, on April 3, 2009, FEMA
published a technical amendment that updated the agency's titles and
organization (74 FR 15328). That rule changed ``Regional Director'' to
``Regional Administrator'' in this paragraph. To ensure this final rule
does not undo that change, the language of the IR is repeated to
incorporate the change from the technical amendment.
III. Discussion of Public Comments
FEMA received five public comments regarding the IR published on
October 31, 2007. The comments on the IR were submitted by three State
emergency management agencies, the Association of State Floodplain
Managers, and an individual citizen. The comments received, together
with FEMA's response, are set forth below. Many of the public comments
contained general supportive statements or positive responses to
specific regulatory changes. Although FEMA appreciates the public
support for this rulemaking, and took those statements into
consideration when drafting this final rule, FEMA has no specific
response to those comments and they are not represented in this
discussion. Additionally, the comments regarding river flow and
impervious surfaces in New Jersey were outside the scope of this
rulemaking. Therefore, FEMA has no specific response to those comments.
All previously published rulemaking documents, as well as all comments
received are available in the public docket for this rulemaking. The
public docket for this rulemaking is available online at the Federal e-
Rulemaking Portal at http://www.regulations.gov under Docket ID FEMA-
2006-0010.
44 CFR Part 78
44 CFR part 78 provides information on the actions, procedures, and
requirements for the administration of
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the FMA program. The FMA program is designed to assist States and local
governments in funding cost effective actions that result in the
greatest cost savings to the NFIF. One commenter noted that paragraph
78.12(f), which allows for other activities that bring an insured
structure into compliance with NFIP minimum standards, and paragraph
78.12(h), that allows for beach nourishment activities, are now
excluded in the new rule at 44 CFR part 79. The commenter had no
concerns with these changes. This change was incorporated into the IR
to implement a policy change, and has not been modified in this final
rule. Eligible projects that now can be funded under FMA are limited to
acquisition/demolition, relocation, elevation, floodproofing, and minor
localized flood reduction projects.
44 CFR Part 79
General
44 CFR part 79 implements certain amendments to the NFIA that
provide incentives for States and communities to mitigate the effects
of flood damage to severe repetitive loss properties by creating the
SRL program and by reducing the cost share requirements in the existing
FMA program for SRL properties. One commenter noted that Sec. Sec.
79.8 and 79.9 replace Sec. 78.13 and add language that is consistent
with how the FMA program is currently being implemented. Another
commenter indicated that this rulemaking illustrates how cumbersome the
SRL program is as a result of complexity in the statute, and as a
result the SRL program when implemented will be difficult.
FEMA acknowledges that the rule is consistent with the statutory
language as required by the amendments to the NFIA and that many
details of the SRL program reflect the statute. FEMA acknowledges that
implementation of the program poses some challenges. As a result of
carrying out the Fiscal Year 08 and 09 programs, FEMA is working to
identify and address critical implementation issues in order to
streamline, where possible, the delivery of assistance to mitigate SRL
properties.
Section 79.3 (Responsibilities/Reallocation)
Section 79.3 outlines FEMA's, States', Tribes', and communities'
roles and responsibilities in implementing the FMA and SRL programs.
These responsibilities include administering and providing oversight to
FEMA-related hazard mitigation programs and grants by issuing program
guidance and procedures, allocating funds to States for the FMA and SRL
programs, awarding all grants to the grantee, and providing technical
assistance and training to State, local, and Indian Tribal governments.
One commenter noted that changes to the Federal responsibilities
section of the IR eliminated FEMA regional office authority to award
grants, and transferred that authority to FEMA headquarters. The
commenter also acknowledged FEMA's recent procedural change that no
longer allows for a regional reallocation of FMA funds; rather, all
unallocated funds now must return to FEMA headquarters and be
reallocated through a national competition. The commenter prefers
FEMA's previous procedure that allows for a regional reallocation
followed by a national reallocation.
Although the Region is no longer specified in the new Sec. 79.3
(which replaces paragraph 78.3(a)) regarding responsibility for the
administration of funds awarded under the FMA program, FEMA disagrees
that this has the effect of transferring authority to award grants from
the Region to FEMA Headquarters. Rather, the provision allows FEMA
increased flexibility in determining how to implement allocation,
award, and reallocation to more efficiently make grant assistance
available to eligible applicants and to more equitably distribute the
FMA funds nationally in the event that eligible applications exceed
available dollars.
Section 79.4 (Availability of Funding)
Section 79.4 provides information regarding the availability of
funding and provides guidelines regarding the allocation process. Two
commenters noted that the allocation formula for the SRL program is
reasonable, but one indicated that the IR eliminates the base amount of
per State funding for FMA which had been $10,000 for planning and
$100,000 for projects. The rule does remove the base amounts of
funding. The FMA allocation formula as described at Sec. 79.4 is based
on the number of NFIP policies and repetitive loss structures in each
State, in addition to criteria described at Sec. 79.6, eligibility.
This provides FEMA with increased flexibility, which ensures that as
many eligible projects as possible are funded.
Management Costs
One commenter was opposed to the elimination of paragraph 78.8(c)
which specifies that a maximum of 10 percent of FMA funds will be
available for Technical Assistance grants because there is no
equivalent language in the IR to provide for costs incurred by the
State in administering this program. The commenter suggested that this
change indicates that FEMA intends to reduce management costs by policy
instead of a rule change.
FEMA does not intend for this rule to reduce the amount of
assistance provided to administer the FMA and SRL programs. In the IR,
paragraph 79.8(a)(1) contains language that allows for eligible
management costs. For the purposes of clarity, the term management
costs in the IR replaces the term Technical Assistance grants as used
in 44 CFR part 78. Management costs as described in the IR provide for
costs incurred by the State in administering the FMA and SRL programs
with the same 10 percent cap. Thus, there is equivalent language in the
IR to provide for such costs.
FMA Cap
One commenter noted that the community and State cap on FMA funding
will pose an obstacle in some areas. Although this cap may limit the
funding of potential FMA projects for some communities, it is a
requirement imposed by the statute that authorized the FMA program (42
U.S.C. 4104c). Although FEMA has no discretionary authority to remove
the cap, the statute gives FEMA the discretion to waive the caps for
any 5-year period when a major disaster or emergency for flooding is
declared under the Stafford Act in that community or State,
respectively. This provision is implemented at Sec. 79.4 of the rule.
In-Kind Match Limit
One comment notes that up to half of the local match to a FMA
project can be an in-kind match and that FMA is the only FEMA
mitigation program with the in-kind restriction. FEMA agrees that there
is a restriction on the use of in-kind matching of FMA projects to meet
the required non-Federal contribution. This is a requirement from the
legislation that authorized the FMA program (42 U.S.C. 4104c(g)(1))
which requires that in-kind contributions by any State or community
shall not exceed one-half of the amount of non-Federal funds
contributed by the State or community.
Requirement of an SRL Non-Federal Match
One commenter noted that the SRL program requires a non-Federal
match unlike the Repetitive Flood Claims (RFC) program. The commenter
adds that many communities find it difficult to promote mitigation
buyouts when the property will be deed restricted and there is a loss
of tax base. With respect
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to the SRL non-Federal match, the regulation mirrors the language of
the authorizing statute. (42 U.S.C. 4102a(d)) The authorizing language
for the RFC program does not contain a similar match requirement and
FEMA has not implemented one. FEMA has interpreted that the intent of
the RFC is to provide mitigation assistance for States and communities
that cannot meet the requirements of the FMA program, including the
ability to provide a non-Federal match.
Section 79.6 (Eligibility)
Section 79.6 provides information on eligible applicants,
subapplicants, State mitigation plan requirements, eligible activities,
and minimum project criteria. One commenter noted that elevation,
flood-proofing, demolition, and rebuilding will occur at least to the
Base Flood Elevation (BFE) level or higher, if required by FEMA or
State or local ordinance. Another commenter added that its particular
jurisdiction requires the lowest enclosed level to be the BFE plus 2
feet for both FMA and HMGP flood mitigation projects. The commenter
noted that this requirement is pursuant to its grant administrative
discretion and its responsibility to prepare and adopt its State
Standard Mitigation Plan, not because of local ordinance or State
statute. The commenter requested that FEMA change the IR by adding
statements which recognize that State administrative provisions and
mitigation plans may also require an elevation higher than the BFE.
FEMA has worked closely with its State and local partners to
robustly implement mitigation planning as part of their decision-
making. FEMA encourages, as part of an overall mitigation strategy,
that States and local communities identify the particular hazard or
hazards in their areas. Upon identification and prioritization of those
hazards, State and local decision-makers are encouraged to develop
prudent mitigation measures to address those risks and vulnerabilities.
FEMA encourages States to establish more stringent requirements as part
of their State administrative provisions or State mitigation plan.
FEMA's guidelines for floodplain management under the NFIP are a
minimum standard; however, States are afforded the flexibility to adopt
and implement more restrictive requirements, which may include
provisions specific to mitigation. The IR was not intended to limit
States from implementing their own administrative requirements that can
serve as a basis for State-level ordinance or local regulatory changes
to go above and beyond FEMA's minimum standards.
SRL Benefit Cost Analysis Requirements
Two commenters noted that a benefit cost analysis for SRL projects
is required, although mitigation of some structures may not be cost
effective because they are not located in special flood hazard areas.
One of those commenters requested that the SRL and repetitive loss
properties automatically be considered cost effective.
FEMA determined that the intent of the legislation that authorized
the SRL program is to fund projects that reduce flood damages to SRL
properties and that reduce losses to the NFIF. The statutory text does
not specify that the projects must be cost effective; however, FEMA
recognizes that determining cost-effectiveness ensures compliance with
these statutory program purposes, as well as provides a means of
implementing the SRL program's legislative requirement of providing
assistance that will result in the greatest amount of savings to the
NFIF. FEMA continues to evaluate the various approaches to determining
cost-effectiveness in terms of creating savings to the NFIF.
SRL Property Relocation
One commenter indicated that paragraph 79.6(c)(2)(ii) lists the
demolition or relocation of structures to areas outside of the
floodplain as an eligible project without placing limitations on the
future use of the flood prone property. The commenter indicates that
this change in the IR creates a potential for misuse as it would be
possible to use mitigation funding to purchase a property under the SRL
program, have it demolished or relocated, and then build a new
structure on the same flood prone site. FEMA notes that paragraph
79.6(c)(2)(ii) is a component of the eligible activity identified in
paragraph 79.6(c)(2)(i). To correct the error, paragraph 79.6(c)(2)(ii)
has been removed and its substance has been incorporated into the
language of paragraph 79.6(c)(2)(i), which contains a requirement that
the property be converted to open space.
Section 79.7 (Offers and Appeals Under the SRL Program)
Section 79.7 provides information on mitigation offers and appeals
under the SRL program. The section provides guidance on the
consultation process, the voluntary mitigation offer, likely insurance
increases due to refusal of a mitigation offer, and the appeals process
for insurance rate increases. One commenter noted that there is no
appeals process for the market value determination on an SRL property.
The commenter indicated that the lack of an appeals process will likely
cause problems in the implementation of the program.
Contrary to the commenter's claim, FEMA asserts that throughout the
SRL process there are several opportunities for property owners to
formally or informally consult with the State and local community
regarding the purchase offer for their property. Under the SRL program,
the purchase offer must be at least equal to the greatest amount
offered through one of the three alternatives, specified in Sec.
80.17. The local community is required, through a formal SRL
consultation process, to take all necessary steps to ensure that the
property owner is fully informed of the SRL program requirements, and
that proper consultation and offer procedures were followed. In the
event that the property owner does not accept a mitigation offer, the
property owner may submit an appeal of the likely insurance premium
rate increase (under certain circumstances). Specifically, with respect
to an issue of property value, paragraph 79.7(d)(1)(ii)(A) allows the
property owner to appeal an increase in insurance rate premium
resulting from declining the offer of assistance (mitigation offer) if
the purchase offer amount can be documented and verified as an
inaccurate estimate of the property's market value. Also, pursuant to
paragraph 79.7(d)(1)(i), the property owner may appeal if he or she
cannot find a replacement property of comparable value that is
functionally equivalent to the property being replaced. Finally,
paragraph 80.5(c)(5) describes the responsibility of the subapplicant/
subgrantee to include resolving property owner disputes regarding
mitigation offers for the purchase of property.
Request for Statutory Amendments for SRL
A commenter posed several comments that focus on the authorizing
statute with the intent to propose legislative changes to the SRL
program. The commenter raised the following six issues: (1) There is no
requirement for a State/community to participate in the SRL; (2) The
offer process is unique and will be difficult to administer; (3) The
entire appeals process is cumbersome and unnecessary; (4) SRL is the
only mitigation program with consequences for refusal to mitigate; (5)
SRL has a cost share that, compared to RFC for example, puts the
program at a competitive disadvantage; and (6)
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Benefit cost analysis is used to determine whether a project will be
funded or not. These comments pertain directly to the authorizing
statute and do not directly address FEMA's interpretation of that
statute in this regulation. Although FEMA notes the commenter's
concerns, FEMA must adhere to the statutory requirements.
44 CFR Part 80
44 CFR part 80 provides, in a single source, the requirements for
the administration of FEMA mitigation assistance to acquire property
for open space under all FEMA Hazard Mitigation Assistance (HMA)
programs. 44 CFR part 80 also provides information on the eligibility
and procedures for acquisition and relocation of vulnerable structures
away from hazardous areas. Subsequently, the cleared property is to be
maintained as open space in perpetuity.
Paragraph 80.5(b)(7)--Enforcement
Section 80.5 provides information on the roles and responsibilities
of FEMA, the State, the subapplicant, and the participating property
owners in the context of creating open space. Paragraph 80.5(b)(7)
outlines the State's roles and responsibilities to enforce the open
space deed restrictions to ensure that a property purchased with
mitigation funds remains as open space in perpetuity.
One commenter noted that the term ``enforcing'' implies an
assumption that States have a statutory and regulatory authority to
force jurisdictions to uphold open space deed restrictions. The
commenter added that various States may or may not have this authority
to enforce the open space deed restrictions, depending upon which
agency implements the various mitigation grant programs.
By virtue of receiving the HMA funds for open space projects,
States and local communities are accountable for compliance with the
terms of the grant agreement and its requirements for the use of those
funds. Upon receiving FEMA funds for an open space acquisition project,
the grantee and subgrantee assume stewardship, including ensuring that
the deed restrictions are recorded, that there is a clear title to the
property, that all incompatible easements or encumbrances are
extinguished, that the vacant land is clean of hazardous materials,
that the intended and future use of the property complies with the
legally imposed use restrictions, and that the State and the local
community jointly monitor and inspect the deed-restricted properties at
regular intervals to ensure that the property continues to be used for
open space purposes. All parties to the grant/subgrant award assume
these responsibilities by receiving HMA funds. The authority to enforce
these restrictions lies with the State in its role as grantee.
Therefore, just as the grant condition continues in perpetuity pursuant
to Federal law, the responsibility to ensure compliance with that
condition continues in perpetuity. FEMA notes that these
responsibilities have always applied to grantees and subgrantees for
open space acquisition and relocation projects under all of FEMA hazard
mitigation grant programs as necessary to ensure the long-term purpose
of the Federal funds for this particular project type is met.
Section 80.9 (Eligible and Ineligible Costs)
One commenter indicated that the language in paragraph 80.9(c)
allows for reducing a grant award for Duplication of Benefits (DOB)
which could mean that a full DOB analysis would have to be completed
before a project is approved by FEMA. The commenter indicated that the
DOB should not be deducted until the local project manager has met with
each owner during the offer presentation process and credited back
temporary living expenses and/or receipted repairs using insurance or
grant funds. Also, the commenter noted that the language appears to be
confusing the concept of DOB and Duplication of Programs (DOP).
HMA funding must be reduced by the amounts reasonably available to
a property owner (even if not sought or received) designated for the
same purpose or loss. In this case, the purchase offer will be reduced
by the duplicative amount. It is the subgrantee's responsibility to
coordinate with the property owner and to disclose all potential
deductions as a result of funds that were reasonably made available to
the property owner. It is also the subgrantee's responsibility to make
the appropriate deductions from the purchase offer before making a
final mitigation offer to the property owner. Consequently, it is the
property owner's responsibility to take all reasonable steps to recover
funding he or she is eligible to receive. In developing a project
budget, the subapplicant should take all reasonable steps to accurately
identify all project costs. The information needed to determine a DOB
is generally readily available and can impact the mitigation grant
offer at any time. Therefore, it is preferable to identify all DOBs as
early as possible in order to reduce the risk of having a cost overrun.
However, amounts made available for the same purpose at any time, even
after award or acquisition, constitute a DOB and will be treated as
such. It should be noted that funds received by the property owner that
were designated for the same purpose or loss will not be deducted from
the final mitigation offer if the owner can document with receipts that
those funds were expended on repairs or cleanup.
Finally, FEMA disagrees with the commenter's assertion that the
language confuses the concept of DOB and DOP. DOP would occur when an
activity is funded under one program, despite there being more specific
authority to fund it under a different program. DOB occurs when HMA
funds are used to fund a mitigation activity, but other funds for the
same purpose, such as from insurance, are received by or available to
the project participant.
Section 80.11 (Project Eligibility)
Section 80.11 provides information on project eligibility. This
section includes a discussion of voluntary participation, acquisition
of improved properties, subdivision restrictions, and open space
restrictions. Paragraph 80.11(a) notes that a property owner who agrees
to an acquisition must do so on a voluntary basis and that the grantee/
subgrantee can not use their powers of eminent domain to acquire the
property should negotiations fail.
One commenter notes that the term ``negotiations'' may be construed
to mean that negotiations of offers are possible. The commenter
suggests that the use of the term ``negotiations'' may be problematic
in implementing an acquisition/demolition project regardless of the
mitigation grant involved.
FEMA is required to implement the provisions of 49 CFR part 24,
Uniform Relocation Assistance and Real Property Acquisition for Federal
and Federally Assisted Programs (URA). The term ``initiation of
negotiations'' is defined as the delivery of the initial written offer
of just compensation by the Agency to the owner or the owner's
representative to purchase the real property for the project. (49 CFR
24.2(a)(15).) As such, the word ``negotiation'' is a term of art.
If the property owner can verify that the final mitigation offer is
significantly below market value, or presents other convincing facts
such that the offer should be adjusted, then there may be an increase
of the purchase offer. Regardless, in all cases, FEMA, the State, and
the local community will work to ensure that all property owners are
treated fairly and are offered an equitable mitigation offer based on
the
[[Page 47476]]
acceptable methods for determining purchase offers for acquisitions
under FEMA HMA programs.
FEMA revised paragraph 80.11(d) to clarify that the subapplicant
must acquire or retain fee title (full property interest), except for
encumbrances FEMA determines are compatible with open space uses,
consistent with paragraph 80.17(b). In response to a comment, FEMA
reviewed the provisions for obtaining verification that a property
owner is a National of the United States or qualified alien and
therefore eligible to be offered pre-event market value for the
property in an acquisition instead of current market value. To address
any perceived inconsistency, FEMA revised paragraph 80.17(c)(4) to
clarify that the subapplicant must certify that the property owner is a
National of the United States or qualified alien during the application
process.
Section 80.13 (Application Information)
Section 80.13 provides information on application requirements.
Some of this required information includes: property information, deed
restriction language consistent with FEMA's model deed restriction, a
signed notice of voluntary interest, an assurance that there is no
intention to use the acquired property for any public or private
facility for a future use that is inconsistent with 44 CFR part 80, and
certification that the property owner is a National of the United
States or a qualified alien (if the owner is being offered pre-event
market value).
One commenter indicated that the general requirements outlined in
this section will significantly increase the paperwork burden on the
subapplicants in the application process. In particular, the commenter
indicates that prior to appraisal it is difficult to obtain signatures
from property owners regarding the inclusion of their properties in the
project, and notes that, as an applicant, the Voluntary Transaction
Agreements signature is obtained after the grant is awarded to the
local jurisdiction.
FEMA analyzed the anticipated paperwork burden associated with
implementing these mitigation programs with respect to the Paperwork
Reduction Act of 1995 (PRA) (5 CFR part 1320). As part of its PRA
analysis in Section IV.E. of this rule, FEMA determined that the
collection of information needed to develop a mitigation application
package does not impose an additional undue burden on the States and
local communities. Applicants and subapplicants have been submitting
this information before FEMA published the IR. Regardless, FEMA
reviewed 44 CFR 80.13 to ensure that the HMA application information
requirements do not impose any additional undue burden in the
development of HMA applications. Generally, 44 CFR part 80 reflects the
information that has always been requested in program guidance as a
condition for applying for assistance to enable FEMA to determine the
project's eligibility and compliance with program requirements.
With respect to the comment about obtaining project participants'
signatures, FEMA wants to clarify that the timing for obtaining from
the property owner the Statement of Voluntary Participation (formerly
called Voluntary Transaction Agreement), which indicates the market
value of the property and the owner's acknowledgment that they are
voluntarily participating in the project, continues to occur post
award. This is distinct from the Notice of Voluntary Interest, which
simply documents during project development that potentially interested
owners have received general notice from the subapplicant of the
voluntary nature of the potential acquisition project, including that
the subapplicant will not use its eminent domain authority for the
purpose of open space. The Notice of Voluntary Interest may be as
simple as having a group sign-in sheet at a neighborhood meeting about
the possible project that includes a statement to this effect. For FEMA
to ensure compliance with basic program requirements, this less formal
documentation is provided to FEMA during the application process.
Another commenter noted that it is unclear how States will be
required to indicate that there is no intention to use the property for
any public or private facility in the future. Paragraph 80.13(a)(5)
requires that the State provide assurances that the subject property to
be acquired, deed restricted, and converted to open space has no
future, intended, or planned use that is inconsistent with the
requirements delineated in Sec. 80.19 (land use and oversight).
Compliance with this regulation is accomplished through a written
statement submitted as part of the application.
Two commenters indicated that it is unclear why offering the pre-
event value to a property owner requires that the subapplicant provide
certification that the property owner is a National of the United
States or a qualified alien. One commenter also notes that Sec. 80.13,
which indicates that this certification must be done as part of the
application process, conflicts with Sec. 80.17 which indicates that
this certification must be done before offering pre-event market value
for a property.
As established by the Personal Responsibility and Work Opportunity
Reconciliation Act of 1996 (PRWORA) (42 U.S.C. 1305 note), an alien who
is not a qualified alien (as defined in 8 U.S.C. 1641) is not eligible
for any Federal public benefit. In this instance, such a Federal public
benefit results from an offer of pre-event market value, which has the
effect of compensating for the disaster loss beyond the current market
value of the property. This benefit is reserved for property owners who
owned the property during the event and who are Nationals of the United
States or qualified aliens. The property value for other individuals
must be based on current market value. To ensure compliance with the
PRWORA, local communities offering pre-event market value must verify
that the property owners are either Nationals of the United States or
qualified aliens.
The term ``National of the United States'' is defined at 8 U.S.C.
1101 and means a citizen of the United States or a person who is not a
citizen but who owes permanent allegiance to the United States. The
term ``qualified alien'', as delineated in the Immigration and
Nationality Act (the Act) at 8 U.S.C. 1641, is an individual who meets
certain criteria contained in the Act at the time they apply for,
receive, or attempt to receive a Federal public benefit.
In response to the commenter's view that there is an inconsistency
between Sec. Sec. 80.13 and 80.17, FEMA notes that it intended the
language in paragraph 80.17(c)(4) to describe a pre-condition of
offering pre-event value, not to address the timing of obtaining the
information. Such information is relevant to the eligible costs of the
project and is provided to FEMA during the application process. FEMA
revised Sec. 80.17 to clarify that the pre-event value is only
available to a property owner that has certified during the application
process as to being a National of the United States or a qualified
alien.
Section 80.17 (Project Implementation)
Paragraph 80.17(c)(1) provides that the amount of a purchase offer
is either the current market value of the property or the market value
of the property immediately before the relevant event affecting the
property. One commenter requested clarification of the term ``relevant
event'' for Pre-Disaster Mitigation (PDM). The commenter indicated that
this clarification will
[[Page 47477]]
make implementation of the program easier. As it relates to PDM, the
regulation states that the relevant event is the most recent major
disaster that affected the subject property. In the case where multiple
disasters have affected the same property, this section indicates that
the ``grantee and subgrantee shall determine which is the relevant
event.'' Alternatively, if the project is not occurring in association
with or will be more than 12 months after a disaster event, for
example, the grantee and subgrantee may want to consider whether
current market value may be more appropriate, per paragraph
80.17(c)(3).
One commenter indicated that the flexibility built into the SRL
program affords market value determination of the greatest amount (i.e.
current market value, pre-event market value, original purchase price
paid, or outstanding amount of the loan on the property). The commenter
indicated that in some instances the offer of the greatest amount would
render the property not cost effective.
Paragraph 80.17(c)(2) notes that for acquisition of properties
under SRL, the purchase offer is to be not less than the greatest of
the following amounts: the current market value of the property or the
pre-event market value of the property; the original purchase amount
paid by the property owner holding the flood insurance policy as
demonstrated by property closing documents; or the outstanding amount
of any loan to the property owner, secured by a recorded interest in
the property at the time of the purchase offer. It is legislatively
mandated at 42 U.S.C. 4102a(g)(3) that FEMA use these values to
determine the greatest amount on which to base a purchase offer. The
statute also requires that the purchase price be the greatest of those
amounts. FEMA acknowledges that as a result of this method, there may
be instances where the project costs outweigh the project benefits;
however, FEMA must follow the legislatively mandated direction.
Section 80.19 (Land Use and Oversight)
Section 80.19 provides guidance on open space requirements and land
uses compatible with open space. One commenter noted the correlation
between the requirement in paragraph 80.17(b) that any incompatible
easements or other encumbrances to the property be extinguished before
acquisition, and the requirement in paragraph 80.19(a)(1)(i)
identifying ``below ground pumping and switching stations'' as not
being compatible with open space uses. The commenter added that this
requirement restricts the ability of the local jurisdiction to purchase
a property because a utility company may be unwilling to nullify an
easement.
Above or below ground pumping stations or other uses that obstruct
the natural and beneficial use of the floodplain are deemed as land
uses that are incompatible with FEMA's open space requirements because
they are detrimental to maintaining the beneficial functions of the
floodplain. If, at the time of acquisition, a property is used for an
incompatible open space use, then that property is no longer eligible
for acquisition if the use cannot be discontinued. Similarly, if
easements for the property allow for any incompatible use, such
provisions must be nullified in order for the property to be acquired
(provisions allowing for compatible uses may remain in effect). FEMA
acknowledges that where incompatible uses will continue to be permitted
on a property, the property is not eligible for FEMA HMA funds for an
acquisition for open space purposes.
One commenter expressed concern with the monitoring and reporting
requirements and the enforcement provisions of Sec. 80.19. The
commenter suggested a monitoring timeframe consistent with mitigation
plans.
In an effort to ease the workload for monitoring, 44 CFR part 80
reduces the frequency of HMGP grant monitoring from once every 2 years
to once every 3 years. This change makes all HMA programs consistent in
their property acquisition land-use monitoring requirement. FEMA
believes that further extending this timeframe would not provide
sufficient monitoring to ensure ongoing compliance with the land use
requirements. In addition, FEMA does not think it is appropriate to
synchronize the open space monitoring timeframe with the completely
unrelated timeframe for local mitigation plan updates, and notes that
to do so could place additional distractions on local jurisdictions at
a time when they need to focus instead on the mitigation planning
process.
The same commenter also raised concerns about State
responsibilities, including funds and authority to meet enforcement
responsibilities, including taking legal action. Finally, the commenter
identified concerns about improper consequences for State and
subgrantee failure to enforce open space requirements, noting that it
would be unfair for the State to lose HMA assistance if the subgrantee
were non-compliant.
In response, it should be noted that 44 CFR part 80 does not
substantially differ from previous open space project grant
requirements, where the State has always played a vital role in the
monitoring and enforcement of the open space restrictions. These
provisions have been a requirement of FEMA property acquisition and
relocation for open space projects almost since program inception. They
have been reflected in the HMGP Desk Reference and the annual program
guidance for the other HMA programs (e.g., the PDM program), which also
incorporated FEMA's model deed restriction language. The States, as
grantees, and subgrantees agree to this language as a condition of
receiving HMA funding, both by signing a statement of assurances
acknowledging these conditions, and by accepting grant funds subject to
the grant agreement. Unlike most NFIP-related programs and activities
where the primary entity is the community, for HMA grant purposes the
State is the grantee and is accountable for the use of funds and for
assuring compliance with the terms of the grant award and the program.
(See, e.g., 44 CFR 206.433 and 13.3.) It also should be noted that FEMA
is also accountable for ensuring that Federal awards are used for the
intended purpose. The IR restated and codified previous HMA program
requirements to ensure that States and FEMA carry out their fiscal
responsibilities by taking appropriate actions to maintain consistency
with Federal open space requirements. This action may or may not
involve court action. The option of seeking specific performance in a
court of law or equity is not ``a requirement,'' but is an available
option when deemed appropriate.
Further, the options available to FEMA for enforcing the open space
requirements are not new. FEMA has always retained the right to bring
legal action against a State or local jurisdiction that fails to comply
with the open space terms of the grant and deed restriction. In
addition, as explained in the rule, the option of withholding HMA
assistance is a reasonable response in the event that the State and
subgrantee fail to make a good faith effort to enforce the deed
restrictions they voluntarily agreed to enforce. These remedies for
non-compliance are consistent with government-wide Federal grants
management procedures. (See, e.g., 44 CFR 13.43(a).) In the case of a
State and/or local jurisdiction failing to comply with the grant terms
and deed restrictions, taking such an action may be the most effective
means of encouraging a continued commitment to the open space
responsibilities. FEMA may withhold funds from a subgrantee for failure
to demonstrate a
[[Page 47478]]
good faith effort to come into compliance with the terms of the grant.
Because the grant relationship is between FEMA and the State as
grantee, funds withheld from a subgrantee are also withheld from the
grantee. This does not necessarily mean that FEMA will withhold all HMA
funding from that State.
General Comment
One commenter expressed concern that FEMA's Flood Insurance Rate
Map (FIRM) is antiquated and therefore does not provide the public with
the most accurate and up-to-date risk mapping data. The commenter
suggested that FEMA be proactive in stopping development in flood-prone
areas.
While this comment is outside the scope of this rulemaking, FEMA
notes that efforts have been made to update and digitize flood maps.
Local communities and States work closely with FEMA to provide the most
up-to-date data on flood risk. Any interested party may ask community
officials to submit a map revision request to FEMA in accordance with
44 CFR part 65 of the NFIP regulations. Factors that influence when the
maps are updated are: (1) When climatological or physical changes in
watersheds occur, or (2) when mapping methodologies are improved.
IV. Regulatory Requirements
A. National Environmental Policy Act
FEMA has considered this rule in accordance with its implementing
regulations for complying with the National Environmental Policy Act of
1969 (NEPA) (42 U.S.C. 4321-4365), which are found at 44 CFR part 10.
The rulemaking addresses applicant planning requirements, as well as
eligibility, funding increases, and cost sharing/funding incentives
relating to certain disaster mitigation programs and does not change
the type or nature of mitigation actions that may be funded. This
rulemaking would neither individually nor cumulatively have a
significant effect on the human environment and, therefore, neither an
environmental assessment nor an environmental impact statement is
required. This rulemaking is among the category of actions included in
the Categorical Exclusions listed at paragraph 10.8(d)(2)(ii), which
excludes the preparation, revision and adoption of regulations from the
preparation of an environmental assessment or environmental impact
statement, where the rule relates to actions that qualify for
categorical exclusions. The related actions of the development of plans
and administrative activities that are included in this rule are also
categorically excluded under Sec. 10.8 paragraphs (d)(2)(i) and
(d)(2)(iii). FEMA received no public comments on the IR regarding its
NEPA determination.
B. Executive Order 11988, Floodplain Management
FEMA has prepared and reviewed this rule under the provisions of
Executive Order 11988, Floodplain Management. FEMA's policy,
procedures, and responsibilities in implementing this Executive Order
are set forth in 44 CFR part 9. FEMA's floodplain management
regulations are intended to avoid long and short term adverse impacts
associated with the occupancy and modification of floodplains; to avoid
direct and indirect support of floodplain development whenever there is
a practical alternative; to reduce the risk of flood loss; to promote
the use of nonstructural flood protection methods to reduce the risk of
flood loss; to minimize the impacts of floods on human health, safety
and welfare; to restore and preserve the natural and beneficial values
served by floodplains; and to adhere to the objectives of the Unified
National Program for Floodplain Management. As stated in the
rulemaking, the purpose of the SRL and FMA programs is to mitigate
insured property losses from floods, thereby minimizing impacts to the
NFIF, which is consistent with the intent of the Executive Order. In
addition, for project activities funded through the SRL and FMA
programs, each project will go through the environmental review
process, which will include compliance with Executive Order 11988. FEMA
received no public comments on the IR regarding its Executive Order
11988 determination.
C. Executive Order 12866, Regulatory Planning and Review
Under Executive Order 12866, a significant regulatory action is
subject to the Office of Management and Budget (OMB) review and the
requirements of the Executive Order. The Executive Order defines
``significant regulatory action'' as one that is likely to result in a
rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or Tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact or entitlements, grants,
user fees, or loan programs or the right and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
This final rule adopts the regulations established in the IR with a
few nonsignificant changes that are a logical outgrowth from the IR.
This final rule does not meet the criteria under paragraphs 2, 3, or 4
of the provision of the Executive Order. In addition, FEMA determined
that it is not likely to have a significant economic impact of $100
million or more per year (under paragraph 1 of this provision). This
rule has not been reviewed by OMB.
This final rule is intended to have a positive impact on State,
local, and Indian Tribal governments. The new SRL program and the
modified FMA program assist State, local, and Indian Tribal governments
in reducing the loss of life and property from flooding events by
providing additional grant resources and the ability to increase the
Federal cost share for projects mitigating SRL properties. The FMA is
an annual grant program created with the goal of reducing or
eliminating claims under the NFIP. The SRL pilot program provides
funding to assist States and communities in implementing measures to
reduce or eliminate the long-term risk of flood damage to severe
repetitive loss structures insured under the NFIP, therefore reducing
payments from the NFIF. The SRL program differs from FEMA's other
mitigation grant programs, as those property owners who decline offers
of mitigation assistance will be subject to increases to their flood
insurance premium rates. This final rule also implements changes to the
FMA program by allowing for up to a 90 percent Federal cost share for
the mitigation of severe repetitive loss properties (the standard
Federal cost share is 75 percent). While the SRL and FMA programs will
be implemented as separate programs with different funding accounts,
they are similar in their goals and purpose. Therefore, FEMA has
included both of these programs into one implementing regulation to
ensure consistency between the programs.
The primary economic impact of the final rule is defined as the
additional transfer of funding from FEMA to State, local, and Indian
Tribal governments to implement measures to reduce or eliminate the
long-term risk of flood
[[Page 47479]]
damage to severe repetitive loss structures. FEMA made conservative
assumptions in order not to under estimate the economic impact of the
final rule. Historically, the FMA program has provided $20 million in
grants on an annual basis. The NFIA, as amended, authorizes the
appropriations for the existing FMA program to be increased from $20
million to $40 million per year. Congressional appropriators have
gradually increased the funding for this program, and the FMA program
may eventually reach its total authorized $40 million cap per year.
In fiscal year 2008, FEMA awarded $38 million for the mitigation of
173 properties at an average of $220,000 per property under the SRL
pilot program. In fiscal year 2009, FEMA expects to award $50 million
for the mitigation of 227 properties also at an average of $220,000 per
property. To date, no one has refused the offer of mitigation or
appealed, therefore no premiums have increased.
The purpose of the SRL grant program is to reduce or eliminate
claims through flood mitigation projects that would result in the
greatest savings to the NFIF. The two most common types of flood
mitigation projects are elevation of a flood prone structure, and
acquisition and demolition or relocation of a flood prone structure. In
2006, the NFIP paid a total of $617.28 million for claims with an
average claim payment of $25,545. Severe Repetitive Loss properties
account for far less than 1 percent of the current NFIP policies, yet
these properties account for over 7 percent of the total amount paid in
claims. Approximately, 8,544 properties were identified as meeting the
definition of severe repetitive loss, among which 1,067 SRL properties
were damaged by flood and paid $46.21 million in 2006 (or $49.35
million in 2008, if adjusted to reflect inflation). Assuming that all
400 SRL properties (173 in FY08 + 227 in FY09) have accepted mitigation
offers, 4.7 percent of the 8,544 SRL properties will lower or eliminate
the risk of future flood damages by the end of fiscal year 2009.
Therefore, the reduction in claims paid for SRL properties is estimated
at up to $2.31 million per year (4.7 percent x $49.35 million).
Assuming that the FMA program reaches its $40 million cap per year,
the net economic impact of the final rule is estimated to be up to
$61.69 million per year. Table 1 details the annual impact of the final
rule. The NFIA, as amended, authorizes the SRL program through the end
of fiscal year 2009; therefore, the impact of this rule will be reduced
by $44 million in fiscal year 2010 and beyond.
Table 1--Net Annual Impact of the Final Rule
[in 2008 $]
------------------------------------------------------------------------
------------------------------------------------------------------------
FMA Program............................................. $20,000,000
SRL Program............................................. *44,000,000
National Flood Insurance Fund........................... (2,310,000)
---------------
Total............................................... 61,690,000
------------------------------------------------------------------------
* Average of $38 million in FY 2008 and $50 million in FY 2009.
D. Executive Order 12898, Environmental Justice
In accordance with Executive Order 12898, Federal Actions to
Address Environmental Justice in Minority Populations and Low-Income
Populations, 59 FR 7629, Feb. 16, 1994, FEMA incorporates environmental
justice into our policies and programs. The Executive Order requires
each Federal agency to conduct its programs, policies, and activities
that substantially affect human health or the environment, in a manner
that ensures that those programs, policies, and activities do not have
the effect of excluding persons from participation in our programs,
denying persons the benefits of our programs, or subjecting persons to
discrimination because of their race, color, or national origin.
This rule implements the SRL program, providing mitigation grants
to severe repetitive loss properties, and improves the FMA program and
the mitigation planning requirements. This rule also clarifies and
simplifies the planning requirements for Indian Tribal governments. No
action in this rule will have a disproportionately high or adverse
human health and environmental effect on any segment of the population.
FEMA received no comments during the IR comment period that disagreed
with this determination.
E. Paperwork Reduction Act of 1995
In accordance with the Paperwork Reduction Act of 1995, 44 U.S.C.
3501-3520, OMB has approved use of OMB Numbers 1660-0025, FEMA
Emergency Preparedness and Response Directorate Grants Administration
Forms under 44 CFR parts 78, 79, and 206 in this rule; 1660-0062,
State/Local/Tribal Hazard Mitigation Plans--Section 322 of the Disaster
Mitigation Act of 2000 under 44 CFR part 201; 1660-0103, Property
Acquisition and Relocation for Open Space under 44 CFR part 80; and
1660-0104, Severe Repetitive Loss (SRL) Appeals process under 44 CFR
part 79. The approved collections have gone through the OMB's normal
clearance procedures in accordance with the provisions of OMB
regulation at 5 CFR 1320.10. Use of these collections, under this final
rule, does not impose addition burden and are approved for use until
August 31, 2011.
The information collection activity under the approved OMB
information collection 1660-0072, Mitigation Grant Programs/e-Grants
(previously named Flood Mitigation Assistance (e-Grants) and Grant
Supplemental Information) have been combined with OMB No. 1660-0071,
Pre-Disaster Mitigation (PDM) Grant Program/eGrants to streamline and
simplify documentation of the same information collected for all
mitigation e-Grants program under section 203 (Predisaster Hazard
Mitigation) of the Stafford Act (42 U.S.C. 5133) and has been approved
for use until February 28, 2011.
F. Executive Order 13132, Federalism
Executive Order 13132, Federalism, signed August 4, 1999, sets
forth principles and criteria that agencies must adhere to in
formulating and implementing policies that have federalism
implications, that is, regulations that have substantial direct effects
on the States, or on the distribution of power and responsibilities
among the various levels of government. Federal agencies must closely
examine the statutory authority supporting any action that would limit
the policymaking discretion of the States, and to the extent
practicable, must consult with State and local officials before
implementing any such action.
FEMA reviewed the IR under Executive Order 13132 and concluded that
the IR, which implemented the statutory requirements for a new SRL
program as well as a potential increase in the Federal share for the
FMA program, simplified the planning requirements, and reflected a
statutorily-mandated change to the HMGP allocation, does not have
federalism implications as defined by the Executive Order. FEMA
received no comments during the IR comment period that disagreed with
this determination. FEMA also determined that this final rule does not
significantly affect the rights, roles, and responsibilities of States,
and involves no preemption of State law nor does it limit State
policymaking discretion.
[[Page 47480]]
G. Executive Order 13175, Consultation and Coordination With Indian
Tribal Governments
While this rule does have ``Tribal implications'' as defined in
Executive Order 13175, it does not have a substantial direct effect on
one or more Indian Tribes, on the relationship between the Federal
Government and Indian Tribes, or on the distribution of power and
responsibilities between the Federal Government and Indian Tribes. FEMA
coordinates with Indian Tribal governments while implementing its
programs, and has modified its procedures to accommodate some of the
issues relating to the Tribal governments. This rule clarifies those
procedures and streamlines the roles and responsibilities of Indian
Tribal governments in mitigation planning.
Indian Tribal governments may apply for assistance directly to FEMA
as a grantee, or through the State as a subgrantee. (See 44 CFR
201.3(e) and 206.202(f)(1).) Before the IR went into effect, Indian
Tribes were permitted to prepare either a State-level Mitigation Plan,
or a Local-level Mitigation Plan depending on whether they intend to
apply as a grantee, or as a subgrantee. Before publishing the IR, FEMA
discussed the existing planning requirements with many of the Indian
Tribal governments as they were developing their plans, or while
attending Tribal training courses, and were informed that neither of
these options sufficiently met the needs of the Indian Tribal
governments. To address this problem, the IR established a specific
planning requirement for Indian Tribal governments in 44 CFR 201.7 that
recognized some of the unique aspects of these governments and combined
the appropriate aspects of State and local planning requirements into
one section for Indian Tribal governments.
The substance of this rule is intended to have a positive impact on
Indian Tribal governments and their relationship with the Federal
Government. The rule does not impose substantial direct compliance
costs on Indian Tribal governments, nor does it preempt Tribal law,
impair treaty rights nor limit the self-governing powers of Indian
Tribal governments. FEMA received no comments during the IR comment
period that disagreed with this determination.
H. Congressional Review of Agency Rulemaking
FEMA has sent this final rule to the Congress and to the General
Accountability Office under the Congressional Review of Agency
Rulemaking Act, (Congressional Review Act), 5 U.S.C. 801-808. The final
rule will not result in a major increase in costs or prices for
consumers, individual industries, Federal, State, or local government
agencies, or geographic regions. It will not have significant adverse
effects on competition, employment, investment, productivity,
innovation, or on the ability of United States-based enterprises to
compete with foreign-based enterprises.
I. Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980 (RFA), 5 U.S.C. 601-612, as
amended by the Small Business Regulatory Enforcement Fairness Act of
1996 (Pub. L. 104-121), requires Federal agencies to consider the
potential impact of regulations on small businesses, small governmental
jurisdictions, and small organizations during the development of their
rules. When an agency invokes the good cause exception under the
Administrative Procedure Act to make changes effective through an
interim final or final rule, the RFA does not require an agency to
prepare a regulatory flexibility analysis. FEMA determined in the IR
that good cause exists under 5 U.S.C. 553(b)(B) to exempt this rule
from the notice and comment requirements of 5 U.S.C. 553(b) (72 FR
61720, Oct. 31, 2007). Therefore, a regulatory flexibility analysis is
not required for this rule.
J. Executive Order 12630, Taking of Private Property
This rule will not affect a taking of private property or otherwise
have taking implications under Executive Order 12630, Governmental
Actions and Interference with Constitutionally Protected Property
Rights. In 44 CFR 80.11(a), this final rule explicitly states that a
grantee/subgrantee cannot use its eminent domain authority to acquire
the property for open space purposes; only such projects where the
property owner participates voluntarily are eligible to receive a
grant.
K. Executive Order 12988, Civil Justice Reform
This rule meets applicable standards in sections 3(a) and 3(b)(2)
of Executive Order 12988, Civil Justice Reform, to minimize litigation,
eliminate ambiguity, and reduce burden.
L. Unfunded Mandates
Title II of the Unfunded Mandates Reform Act of 1995 (UMRA),
enacted as Public Law 104-4 on March 22, 1995 (2 U.S.C. 1531-1538),
requires each Federal agency, to the extent permitted by law, to
prepare a written assessment of the effects of any Federal mandate in a
proposed or final agency rule that may result in the expenditure by
State, local, and Tribal governments, in the aggregate, or by the
private sector, of $100 million or more (adjusted annually for
inflation) in any one year. UMRA exempts from its definition of
``Federal intergovernmental mandate'' regulations that establish
conditions of Federal assistance or provide for emergency assistance or
relief at the request of any State, local, or Tribal government.
Therefore, this rule is not an unfunded Federal mandate under that Act.
List of Subjects
44 CFR Part 59
Flood insurance, Reporting and recordkeeping requirements.
44 CFR Part 61
Flood insurance, Reporting and recordkeeping requirements.
44 CFR Parts 78 and 79
Flood insurance, Grant programs.
44 CFR Part 80
Acquisition and Relocation for open space.
44 CFR Part 201
Administrative practice and procedure, Disaster assistance, Grant
programs, Reporting and recordkeeping requirements.
44 CFR Part 206
Administrative practice and procedure, Coastal zone, Community
facilities, Disaster assistance, Fire prevention, Grant programs--
housing and community development, Housing, Insurance,
Intergovernmental relations, Loan programs--housing and community
development, Natural resources, Penalties, Reporting and recordkeeping
requirements.
0
Accordingly, the Interim Rule amending 44 CFR Parts 59, 61, 78, 79, 80,
201, and 206 published on October 31, 2007 (72 FR 61720), is adopted as
a final rule with the following changes:
PART 79--FLOOD MITIGATION GRANTS
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1. The authority citation for part 79 continues to read as follows:
Authority: 6 U.S.C. 101; 42 U.S.C. 4001 et seq.; 42 U.S.C.
4104c, 4104d; Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR,
1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 Comp., p.
376; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 412; E.O. 13286,
68 FR 10619, 3 CFR, 2003 Comp., p. 166.
[[Page 47481]]
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2. Amend Sec. 79.2 by redesignating paragraphs (e) through (l) as (f)
through (m); by adding a new paragraph (e); and by revising paragraphs
(c)(1), newly designated paragraph (l), and newly designated paragraph
(m) to read as follows:
Sec. 79.2 Definitions.
* * * * *
(c) * * *
(1) A political subdivision, including any Indian Tribe, authorized
Tribal organization, Alaska Native village or authorized native
organization, that has zoning and building code jurisdiction over a
particular area having special flood hazards, and is participating in
the NFIP; or
* * * * *
(e) Indian Tribal government means any Federally recognized
governing body of an Indian or Alaska Native Tribe, band, nation,
pueblo, village, or community that the Secretary of Interior
acknowledges to exist as an Indian Tribe under the Federally Recognized
Indian Tribe List Act of 1994, 25 U.S.C. 479a. This does not include
Alaska Native corporations, the ownership of which is vested in private
individuals.
* * * * *
(l) Administrator means the head of the Federal Emergency
Management Agency, or his/her designated representative.
(m) Regional Administrator means the head of a Federal Emergency
Management Agency regional office, or his/her designated
representative.
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3. In Sec. 79.4, revise paragraph (c) introductory text and paragraph
(c)(2) to read as follows:
Sec. 79.4 Availability of funding.
* * * * *
(c) Cost Share. All mitigation activities approved under the grant
will be subject to the following cost-share provisions:
* * * * *
(2) FEMA may contribute up to 90 percent of the cost of the
eligible activities for each severe repetitive loss property for which
grant amounts are provided if the applicant has an approved Mitigation
Plan meeting the repetitive loss requirements identified in Sec.
201.4(c)(3)(v) or Sec. 201.7(c)(3)(vi) of this chapter, as applicable,
at the time the project application is submitted;
* * * * *
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4. Amend Sec. 79.6 by removing paragraph (c)(2)(ii), redesignating
paragraphs (c)(2)(iii) through (c)(2)(vii) as (c)(2)(ii) through
(c)(2)(vi), and revising paragraphs (b)(1) and (c)(2)(i) to read as
follows:
Sec. 79.6 Eligibility.
* * * * *
(b) * * *
(1) States must have an approved State Mitigation Plan meeting the
requirements of Sec. Sec. 201.4 or 201.5 of this chapter in order to
apply for grants through the FMA or SRL programs. Indian Tribal
governments must have an approved plan meeting the requirements of
Sec. 201.7 of this chapter at the time of application.
* * * * *
(c) * * *
(2) * * *
(i) Acquisition of real property from property owners, and
demolition or relocation of buildings and/or structures to areas
outside of the floodplain to convert the property to open space use in
perpetuity, in accordance with part 80 of this subchapter;
* * * * *
PART 80--PROPERTY ACQUISITION AND RELOCATION FOR OPEN SPACE
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5. The authority citation for part 80 is revised to read as follows:
Authority: Robert T. Stafford Disaster Relief and Emergency
Assistance Act, 42 U.S.C. 5121 through 5207; the National Flood
Insurance Act of 1968, as amended, 42 U.S.C. 4001 et seq.;
Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 1978 Comp.,
p. 329; Homeland Security Act of 2002, 6 U.S.C. 101; E.O. 12127, 44
FR 19367, 3 CFR, 1979 Comp., p. 376; E.O. 12148, 44 FR 43239, 3 CFR,
1979 Comp., p. 412; E.O. 13286, 68 FR 10619, 3 CFR, 2003 Comp., p.
166.
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6. In Sec. 80.3, revise paragraphs (l) and (m) to read as follows:
Sec. 80.3 Definitions.
* * * * *
(l) Administrator means the head of the Federal Emergency
Management Agency, or his/her designated representative.
(m) Regional Administrator means the head of a Federal Emergency
Management Agency regional office, or his/her designated
representative.
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7. Revise Sec. 80.11(d) to read as follows:
Sec. 80.11 Project eligibility.
* * * * *
(d) Subapplicant property interest. To be eligible, the
subapplicant must acquire or retain fee title (full property interest),
except for encumbrances FEMA determines are compatible with open space
uses, as part of the project implementation. A pass through of funds
from an eligible entity to an ineligible entity must not occur.
* * * * *
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8. Revise Sec. 80.13(a)(6) to read as follows:
Sec. 80.13 Application information.
(a) * * *
(6) If the subapplicant is offering pre-event value: the property
owner's certification that the property owner is a National of the
United States or qualified alien; and
* * * * *
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9. Revise Sec. 80.17(c)(4) to read as follows:
Sec. 80.17 Project implementation.
* * * * *
(c) * * *
(4) A property owner who did not own the property at the time of
the relevant event, or who is not a National of the United States or
qualified alien, is not eligible for a purchase offer based on pre-
event market value of the property. Subgrantees who offer pre-event
market value to the property owner must have already obtained
certification during the application process that the property owner is
either a National of the United States or a qualified alien.
* * * * *
PART 201--MITIGATION PLANNING
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10. The authority citation for part 201 is revised to read as follows:
Authority: Robert T. Stafford Disaster Relief and Emergency
Assistance Act, 42 U.S.C. 5121 through 5207; Reorganization Plan No.
3 of 1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; Homeland Security
Act of 2002, 6 U.S.C. 101; E.O. 12127, 44 FR 19367, 3 CFR, 1979
Comp., p. 376; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 412;
E.O. 13286, 68 FR 10619, 3 CFR, 2003 Comp., p. 166.
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11. In Sec. 201.2, revise the definition of ``Administrator'', the
first sentence of the definition of ``Indian Tribal government'', and
the definition of ``Regional Administrator'' to read as follows:
Sec. 201.2 Definitions.
Administrator means the head of the Federal Emergency Management
Agency, or his/her designated representative.
* * * * *
Indian Tribal government means any Federally recognized governing
body of an Indian or Alaska Native Tribe, band, nation, pueblo,
village, or community that the Secretary of Interior acknowledges to
exist as an Indian Tribe under the Federally Recognized Indian Tribe
List Act of 1994, 25 U.S.C. 479a. * * *
* * * * *
Regional Administrator means the head of a Federal Emergency
[[Page 47482]]
Management Agency regional office, or his/her designated
representative.
* * * * *
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12. Amend Sec. 201.3 by removing paragraph (c)(7) and by revising the
last sentence of paragraph (e)(1) to read as follows:
Sec. 201.3 Responsibilities.
* * * * *
(e) * * *
(1) * * * In addition, an Indian Tribal government applying to FEMA
as a grantee may choose to address severe repetitive loss properties as
identified in Sec. 201.4(c)(3)(v) as a condition of receiving the
reduced cost share for the FMA and SRL programs, pursuant to Sec.
79.4(c)(2) of this chapter.
* * * * *
0
13. In Sec. 201.6 revise paragraphs (c)(2)(ii)(B) and (c)(3)(iii) to
read as follows:
Sec. 201.6 Local Mitigation Plans.
* * * * *
(c) * * *
(2) * * *
(ii) * * *
(B) An estimate of the potential dollar losses to vulnerable
structures identified in paragraph (c)(2)(ii)(A) of this section and a
description of the methodology used to prepare the estimate;
* * * * *
(3) * * *
(iii) An action plan describing how the actions identified in
paragraph (c)(3)(ii) of this section will be prioritized, implemented,
and administered by the local jurisdiction. Prioritization shall
include a special emphasis on the extent to which benefits are
maximized according to a cost benefit review of the proposed projects
and their associated costs.
* * * * *
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14. In Sec. 201.7 revise paragraphs (a)(2), (a)(3), (c)(2)(ii)(B),
(c)(3)(iii), and (c)(3)(vi) to read as follows:
Sec. 201.7 Tribal Mitigation Plans.
* * * * *
(a) * * *
(2) An Indian Tribal government applying to FEMA as a grantee may
choose to address severe repetitive loss properties in their plan, as
identified in Sec. 201.4(c)(3)(v), to receive the reduced cost share
for the FMA and SRL programs.
(3) Indian Tribal governments applying through the State as a
subgrantee must have an approved Tribal Mitigation Plan meeting the
requirements of this section in order to receive HMGP project grants
and, the Administrator, at his discretion may require a Tribal
Mitigation Plan for the Repetitive Flood Claims Program. A Tribe must
have an approved Tribal Mitigation Plan in order to apply for and
receive FEMA mitigation project grants, under all other mitigation
grant programs. The provisions in Sec. 201.6(a)(3) are available to
Tribes applying as subgrantees.
* * * * *
(c) * * *
(2) * * *
(ii) * * *
(B) An estimate of the potential dollar losses to vulnerable
structures identified in paragraph (c)(2)(ii)(A) of this section and a
description of the methodology used to prepare the estimate;
* * * * *
(3) * * *
(iii) An action plan describing how the actions identified in
paragraph (c)(3)(ii) of this section will be prioritized, implemented,
and administered by the Indian Tribal government.
* * * * *
(vi) An Indian Tribal government applying to FEMA as a grantee may
request the reduced cost share authorized under Sec. 79.4(c)(2) of
this chapter of the FMA and SRL programs if they have an approved
Tribal Mitigation Plan meeting the requirements of this section that
also identifies actions the Indian Tribal government has taken to
reduce the number of repetitive loss properties (which must include
severe repetitive loss properties), and specifies how the Indian Tribal
government intends to reduce the number of such repetitive loss
properties.
* * * * *
PART 206--FEDERAL DISASTER ASSISTANCE
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15. The authority citation for part 206 continues to read as follows:
Authority: Robert T. Stafford Disaster Relief and Emergency
Assistance Act, 42 U.S.C. 5121 through 5207; Reorganization Plan No.
3 of 1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; Homeland Security
Act of 2002, 6 U.S.C. 101; E.O. 12127, 44 FR 19367, 3 CFR, 1979
Comp., p. 376; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 412;
and E.O. 13286, 68 FR 10619, 3 CFR, 2003 Comp., p. 166.
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16. In Sec. 206.226 revise paragraph (b) to read as follows:
Sec. 206.226 Restoration of damaged facilities.
* * * * *
(b) Mitigation planning. In order to receive assistance under this
section, the State or Indian Tribal government applying to FEMA as a
grantee must have in place a FEMA approved State or Tribal Mitigation
Plan, as applicable, in accordance with 44 CFR part 201.
* * * * *
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17. Revise Sec. 206.401 to read as follows:
Sec. 206.401 Local standards.
The cost of repairing or constructing a facility in conformity with
minimum codes, specifications and standards may be eligible for
reimbursement under section 406 of the Stafford Act, as long as such
codes, specifications, and standards meet the criteria that are listed
at 44 CFR 206.226(d).
0
18. Amend Sec. 206.431 by revising the definitions of ``Indian Tribal
government'' and ``Local Mitigation Plan'' and by adding, in
alphabetical order, the definition of ``Tribal Mitigation Plan'' to
read as follows:
Sec. 206.431 Definitions.
* * * * *
Indian Tribal government means any Federally recognized governing
body of an Indian or Alaska Native Tribe, band, nation, pueblo,
village, or community that the Secretary of Interior acknowledges to
exist as an Indian Tribe under the Federally Recognized Indian Tribe
List Act of 1994, 25 U.S.C. 479a. This does not include Alaska Native
corporations, the ownership of which is vested in private individuals.
Local Mitigation Plan is the hazard mitigation plan required of a
local government acting as a subgrantee as a condition of receiving a
project subgrant under the HMGP as outlined in 44 CFR 201.6.
* * * * *
Tribal Mitigation Plan is the hazard mitigation plan required of an
Indian Tribal government acting as a grantee or subgrantee as a
condition of receiving a project grant or subgrant under the HMGP as
outlined in 44 CFR 201.7.
0
19. In Sec. 206.432 revise paragraphs (b) introductory text and (b)(2)
to read as follows:
Sec. 206.432 Federal grant assistance.
* * * * *
(b) Amounts of Assistance. The total Federal contribution of funds
is based on the estimated aggregate grant amount to be made under 42
U.S.C. 5170b, 5172, 5173, 5174, 5177, and 5183 of the Stafford Act for
the major disaster (less associated administrative costs), and shall be
as follows:
* * * * *
(2) Twenty (20) percent. A State with an approved Enhanced State
Mitigation Plan, in effect before the disaster
[[Page 47483]]
declaration, which meets the requirements outlined in Sec. 201.5 of
this subchapter shall be eligible for assistance under the HMGP not to
exceed 20 percent of such amounts, for amounts not more than $35.333
billion.
* * * * *
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20. In Sec. 206.434 revise paragraphs (b)(1), (c)(1), and (e)
introductory text to read as follows:
Sec. 206.434 Eligibility.
* * * * *
(b) * * *
(1) Local and Indian Tribal government applicants for project
subgrants must have an approved local or Tribal Mitigation Plan in
accordance with 44 CFR part 201 before receipt of HMGP subgrant funding
for projects.
* * * * *
(c) * * *
(1) Be in conformance with the State Mitigation Plan and Local or
Tribal Mitigation Plan approved under 44 CFR part 201; or for Indian
Tribal governments acting as grantees, be in conformance with the
Tribal Mitigation Plan approved under 44 CFR 201.7;
* * * * *
(e) Property acquisitions and relocation requirements. Property
acquisitions and relocation projects for open space proposed for
funding pursuant to a major disaster declared on or after December 3,
2007 must be implemented in accordance with part 80 of this chapter.
For major disasters declared before December 3, 2007, a project
involving property acquisition or the relocation of structures and
individuals is eligible for assistance only if the applicant enters
into an agreement with the FEMA Regional Administrator that provides
assurances that:
* * * * *
Dated: September 8, 2009.
David Garratt,
Acting Deputy Administrator, Federal Emergency Management Agency.
[FR Doc. E9-22278 Filed 9-15-09; 8:45 am]
BILLING CODE 9110-12-P