NFIP Substantial Damage

– Substantial Damage: Restoration cost equals or exceeds 50% of pre-damage market value of structure, even if not fully restored.

– Substantial Improvement: Improvement cost equals or exceeds 50% of market value of structure prior to the improvement.

– A Substantially Damaged or Substantially Improved building must meet new construction requirements of the National Flood Insurance Program, if the building is located in a FEMA-defined Special Flood Hazard Area

Substantial Damage

Mathematically Speaking

Cost to Repair + Cost of Improvements

Market Value > 50%

Local floodplain managers must be able to quickly inform building owners of:

• the need to bring substantially damaged buildings into compliance with current flood hazard regulations

•potential grant opportunities and need to sign letter of intent

Post-Event

Before issuing floodplain development permits to repair damage local floodplain manager must:

•Determine costs to repair•Determine pre-event market values •Make SI/SD determinations

SI/SD Determination

• In Oregon, the assessed real market value of improvements may be used as a starting point to establish the market value of a structure

• Building owners may appeal the valuation with a professional appraisal

Assessed RMV

• Educate floodplain managers about how RMV is estimated• Discuss limitations• Help develop substantial damage

assessment protocols in your jurisdiction

Pre-planning