Orange County Register

With the fires passing, folks in the Yorba Linda burn area are keeping an eye on the clouds, worried about the prospect of flooding and mudslides.  On a national scale, federal auditors are doing a bit of worrying as well.

A new study shows that flood insurance rates set by FEMA may not be enough to cover potential damages in a major flood.

The study by the Government Accountability Office found that FEMA is relying on outdated maps and 28-year-old flood probabilities to set insurance rates.  The potential financial fallout is jeopardizing the National Flood Insurance Program, now $17.4 billion in debt.

So off are the insurance premiums, that rates in one area most likely do not reflect the actual risks in that area.

The bottom line: FEMA is not generating enough flood insurance money to cover operating costs, claims for losses and payments to the Department of the Treasury.

Auditors say this is exposing the federal government and ultimately taxpayers – that is me and you — to ever growing financial risk.  

The audit recommends that new data and maps be used to create rates that more accurately reflect the flood risks in individual areas. (Gee, you think?)

“Evidence suggests that flooding is likely to become more severe in the future, resulting in increased risk exposure, the potential for more catastrophic losses and ongoing financial instability for the (insurance) program,” the audit said.

This is especially important in Orange County, where there are efforts to put large areas in a mandatory flood insurance zone.  A bill that would have forced thousands of Southern California residents to buy flood insurance ended up dying in a conference committee when the legislative session ended.

That means it is back to square one for the bill last known as H.R. 3121, which mandated flood insurance for folks living in areas protected by dams and levees, such as the Santa Ana River project. The bill attempted to generate revenue to make up for the debt caused by massive flooding in Louisiana and other gulf coast states.

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