Work on flood-damaged homes located in communities that participate in the National Flood Insurance Program (NFIP) is subject to specific requirements. If the flood-damaged home is in a floodplain and is substantially damaged (see definition below), the NFIP requires that reconstruction and repairs, termed substantial improvements (see definition below), be performed to bring the home into compliance with local floodplain management regulations. These regulations include elevating the home so that its lowest floor is at or above the base flood elevation (BFE). The local jurisdiction may require elevating the home higher than the BFE, to an elevation called the design flood elevation (DFE). Other requirements include using the proper type of foundation (depending on the flood zone in which the house is located), properly anchoring the home to the foundation, using flood-resistant materials, complying with limitations on the use of enclosed areas below the elevated home, and protecting utilities and equipment. Check with the local jurisdiction for additional requirements that must be met.
Reconstruction of a home that is destroyed or that has been so severely damaged that it must be rebuilt is considered construction of a new home, and new homes must comply with the local floodplain management regulations.
Definition: Substantial damage means damage of any origin for which the cost of restoring the structure to its before-damaged condition would equal or exceed 50 percent of the market value of the structure before the damage occurred (FEMA, 2010).
Definition: Substantial improvement means any reconstruction, rehabilitation, addition, or other improvement of a structure for which the cost of the work equals or exceeds 50 percent of the market value of the structure before the start of construction of the improvement. This term includes structures that have incurred substantial damage regardless of the actual repair work performed (FEMA, 2010).
References: FEMA. 2010. Substantial Improvement/Substantial Damage Desk Reference. FEMA P-758. Washington, DC. May 2010.