Posted by Winslow (+382) 7 years ago
Based on the ad that was placed in the newspaper last night by the Eastern Montana Board of Realtors, it appears higher flood insurance rates are eminent for those in the flood zone (84% of Miles City).

In a conversation with a local realtor, rates aren't going to go up by the hundreds, but by the thousands of dollars making it impossible for homeowners or potential buyers to afford the high rates. So a homeowner gets transferred to another city and can't sell his house - will the homeowner just have to walk away? HELLO DETROIT!

The fear is that premiums can be based on the depth of a basement - potentially $1000.00 per foot from where the dirt meets the concrete.

Miles City should have acted months if not years ago to get this problem corrected. It's not a matter of improving the dikes since all the property along the dikes would need to be purchased through eminent domain, which would cost the city millions of dollars. Apparently, our only hope is to (after a feasibility study is conducted) build a flood wall, which in turn would take Miles City out of the flood zone and eliminate the need to carry the FEMA flood insurance (which by the way pays nothing unless your home is swept off it's foundation).

The new city budget includes the money for the feasibility study, but the mayor needs to sign the papers to get the ball rolling. Apparently, once the feasibility study is completed, the city will be eligible to apply for federal grants which should pay for about 50% of the project.

In a newspaper article, the mayor indicated it will cost each man, woman and child in Miles City over $300.00 each to fix the flood problem. That's still better than homeowners paying thousands of dollars a year indefinitely for a worthless insurance. We thought rent is high in Miles City now - can you imagine what rent will be if the homeowner is paying thousands of dollars just for flood insurance?

We need to call our mayor or city council and insist the documents get signed for the feasibility study. The future of Miles City is counting on it.
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Posted by Anns (+117) 7 years ago
Getting a home loan here is hard due to most everything being in flood zone. Sure would be nice to have something done!
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Posted by Amorette F. Allison (+1910) 7 years ago
Put your head between your knees and take deep breaths. Panic is not necessary.

The ad over-simplified a very, very complex matter. I am struggling through FEMA letters now trying to explain it more clearly.

Yes, the subsidized rates are being phased out to reflect 'true risk,' in order to keep the flood insurance program solvent. Yes, they will skyrocket in some areas, especially along the coast, but not here. They may increase slightly. They may increase considerably but they will be phased in over time.

Miles City IS doing something. Our discount rate will increase from 5% to 10% next year because of the efforts of our flood administrator.

The mayor kind of pulled a number of of the air for costs because we have NO idea at this time what the costs would be. A feasibility study hasn't even been started. No one knows what a new dike would cost. No one knows if the Federal government will pick up any or all of the costs. No one can estimate what the eventual costs would be. At best, it will be several years before even estimate costs of a new dike system are known.

Opting out of flood insurance is not that simple. Aside from there being people who actually WANT flood insurance, it will affect federal loan and grant programs. Glendive pulled out of the NFIP for a couple of years and had to get back in order to get federal grants and federally insured home loans.

Yes, we had a chance to fix this problem 30 years ago and chose to ignore it, just as we did with the jail, and are paying for it now, but Miles City is not going to become a ghost town.

Also, how much you have to pay depends somewhat on who holds your home loan. My bank only requires I insure for the amount remaining on my loan so my flood insurance is under $200 a year. Some banks require full replacement cost to be covered, even if the policy owner only owes a fraction of the loan.

And then there are LOMA and other issues. I don't quite know why the realtors panicked, because all of this has been coming our way for years, but the issue is not the end of the world by a long shot.

[This message has been edited by Amorette F. Allison (9/4/2013)]
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Posted by atomicg (+999) 7 years ago
I had a conversation with the NFIP director's office almost a year ago and she told me to expect rates to rise as much as 20% a year for up to 5 years. She told me Congress was trying to phase out all government subsidized rates to make the insurance program into a privatized scheme the government would have no relationship with. At that point it is up to the insurance companies to set the rates at whatever they deem most profitable. Brace yourselves.

After the conversation I sold some of my equipment for digging foundations under existing homes (after receiving many offers for work I can no longer get flood permits for). Miles City has dozens and dozens of good homes on poor foundations and homeowners are now extremely limited in their options. I can no longer dig out basement floors to lower depths at all or expand crawlspaces into basements anywhere in the flood plain.

It is frustrating, just as we were starting to really create a solid small business the federal regulations completely undermined our ability to work. The NFIP director was truly just as annoyed with the situation as I was, we spoke for nearly an hour. When I asked what an entire town was supposed to do when they couldn't afford flood insurance she sadly replied, "mitigate or demolish", "we don't want another Minot". It's a mess.

I do give credit to our flood plain administrator(s) though. They have difficult jobs and are doing a damn fine job with the hands they been dealt by Congress, FEMA, NFIP and DNRC.

[This message has been edited by atomicg (9/4/2013)]

[This message has been edited by atomicg (9/4/2013)]

[This message has been edited by atomicg (9/4/2013)]
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Posted by atomicg (+999) 7 years ago
Why hasn't a feasibility study been started? This came up months ago and the delay was justified by saying we could qualify for grant money. Has this come to fruition or are we still avoiding the problem? I heard KLJ at one time offered a study for the 200k range. is this true? That's what...twenty bucks per resident? Maybe a couple hundred per taxpaying citizen at the most?

Comments? Let's discuss this.
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Posted by Amorette F. Allison (+1910) 7 years ago
We have been diddling around for 40+ years on this issue and we can't solve it overnight. Sad, but our own short-sighted fault.
An organization that is qualified has to be hired for the study. It takes time to find the right firm. (They have to meet with Fed approval.) It takes time to determine the parameters of the study. (You can't just say, so, what would a dike cost?) It takes time to determine the cost of the study. It takes time to find funding for the study.
Then the study takes 18 months or more to be done and compiled.
Then the options are studied.
Then an option is chosen, after months of meetings and research and consideration.
Then we find out what it will cost and whether we can get funding to pay for it.
We decided not to fix the dike 30 years ago because the 25-year pay-off was too long. Pity, that.
The Feds took over from private insurance because private insurance couldn't make a profit off flood insurance. Now the Feds want to turn around and give it back to private insurers, who will have to make a profit.
Somewhere, the original intention got lost.

[This message has been edited by Amorette F. Allison (9/4/2013)]
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Posted by coffeedrunk (+51) 7 years ago
Speaking as a local citizen whom likes the mayor, I can not accept his pulling a number out of thin air when Miles City has plenty of construction companies that can put together a very good bid on the dike improvement, and a city planner can put together a price of any property that may need to be purchased.

Oftedal is a local company which does many multimillion dollar reconstruct jobs just like this. I am sure someone over there will work up a bid so that we are not pulling numbers out of thin air.

PS meeting government standards is very simple, in most cases private industry exceeds the corp of engineers or any government agency.
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Posted by Amorette Allison (+11447) 7 years ago
We are still dealing with millions of dollars and years of time. No way around that.
Oh, and we have no city planner.

[This message has been edited by Amorette Allison (9/4/2013)]
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Posted by B&M (+215) 7 years ago
Just a thought....
A customer of mine has " flood " insurance through nfip... on several rental properties,,,

No coverage unless there is a declared emergency... Just a bunch of rain that gets on the ground deep enough to go over the foundation and flood the place... not covered .
Sincerely
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Posted by Winslow (+382) 7 years ago
Based on the conversation I had with the Realtor, the city was supposed to sign papers for the feasibility study in March but decided first to apply for grants. To date the city has received a small grant and wants to apply for another small grant in October prior to signing papers. In the meantime, nothing is getting done to fix the problem and the homeowners and renters in Miles City are the ones who will suffer the consequences.
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Posted by Amorette F. Allison (+1910) 7 years ago
Whether they sign on for the study today or in a few months, it won't make any major difference. The process will still take YEARS and we will be still be paying higher rates, although not hysterically higher.

Flood insurance is not for groundwater. It has to be something like a river flooding to count. That has been the program since 1968 but a lot of people have never really understood that.

I'm not a huge fan of the program but we have to live with it. That is the choice we made.

[This message has been edited by Amorette F. Allison (9/5/2013)]
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Posted by atomicg (+999) 7 years ago
Amorette is right about the lengthy process. I think most of us realize there isn't a switch to flip or city official to press that will solve this or give us instant gratification. People just want to know if all these delays were worth it, if there will be more delays and what the next move is.

It is frustrating when this perpetual state of limbo the city has been in for decades doesn't seem to be getting more clearly defined. I think people just want a plan that will stick so they can make long term plans for their homes and businesses. A plan that can outlive a political term and be maintained over the course of ongoing leadership succession.
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Posted by Tomm (-1028) 7 years ago
It is interesting to read again about out flood insurance problem. This thread has a lot of correct statements, and a lot of incorrect statements. If you have not read and understand the flood policy, you should not be making statements about what is covered, and what is not covered. The flood insurance program is not a good program. There is a lot of improvement needed, and it is a good example of what happens when the fed. gov. gets involved in something they have no idea how to run. If you think this is screwed up wait until obammacare is in full force. As to our city leaders and the delays in starting the ball rolling, we can not expect much action when no one in city hall has the training or knowledge needed to get grants etc. needed for a project like this going. With no planner, no city engineer etc. expect nothing. We all need to contact your council person and tell them we need to get rolling yesterday on this. Mean while, I have a house for sale that is NOT in the flood zone.
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Posted by Amorette Allison (+11447) 7 years ago
It is possible to explain issues without falling into partisan bickering. The Affordable Care Act has no bearing on levee construction.
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Posted by Tomm (-1028) 7 years ago
just pointing out that the flood program doesn't work because it is run by our broken government.
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Posted by Mathew Schmitz (+289) 7 years ago
[This message has been edited by Mathew Schmitz (9/6/2013)]
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Posted by Bridgier (+8985) 7 years ago
just pointing out that the flood program doesn't work because it is run by our broken government.

Non-sequitur, -10 to slytherin.
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Posted by Amorette F. Allison (+1910) 7 years ago
This is one of those INCREDIBLY complex issues that has been developing for almost 50 years. Just tossing off 'broken government' implying the current administration and Congress is meaningless. I could do a two hour lecture on the evolution of the NFIP and both good and bad things about that have taken place over the generations.
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Posted by Ryan (+482) 7 years ago
It is not right. I bought my house with no flood insurance required and now I am forced to have it.. I will let the bank have it back if the rates get much higher...
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Posted by Amorette F. Allison (+1910) 7 years ago
Considering the housing market, I'd sell. Better for your credit rating and possibly profitable.
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Posted by Winslow (+382) 7 years ago
Key provisions of the 2012 legislation will require the NFIP to [b]raise rates to reflect true flood risk[/u].

Based on the Flood Program Summary of Changes October 1, 2013:
Renewals for properties listed below will experience a premium rate increase up to 25% annually.
Severe Repetitive Loss (SRL) properties consisting of 1-4 family residences.
Properties that have incurred flood-related damage in which the cumulative amounts of National Flood Insurance Program flood insurance claim payments equaled or exceeded the fair market value of the property.
Owners of some business properties (According to the FEMA website, business properties in a Special Flood Hazard Area will see a 25 percent rate increase annually until rates reflect true risk).

There will be no extension of subsidy* to new policies or lapsed policies for Pre Flood Insurance Rate Map (Pre-FIRM) properties in a special flood hazard area. Properties in these areas will require an elevation certificate (estimated between $300-800.00 at the home-owners expense) and photos to determine full risk rating using the current FIRM. The following Pre-FIRM properties/policies are impacted:
Subsidized policies that were written as new business effective on or after July 6, 2012.
Subsidized policies that lapsed and were reinstated with an effective date of October 4, 2012 or later.
Subsidized policies written as new business or as an assigned policy as a result of the property being purchased on or after July 6, 2012.

Policies under the preferred risk policy eligibility extension where a map revision dated newly mapping the property as being located in the special flood hazard area was effective on or after October 1, 2008 will see annual increases averaging 20% beginning with new business and renewals effective on or after October 1, 2013.

Since this is a federal program, Congress may occasionally pass legislation which changes how the program is handled. So if the USA experiences another Katrina - expect changes in the amount you pay for your flood insurance here in Miles City, MT.

*Note: Many of the current policies in Miles City, especially on the north side of town, are subsidized.
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Posted by Amorette Allison (+11447) 7 years ago
The Great American Public wanted the deficit reduced. Forcing home owners to pay for the entire risk of their insurance is one way of doing that.
Be careful what you ask for.
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Posted by Tomm (-1028) 7 years ago
It is possible to explain issues without falling into partisan bickering
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Posted by Amorette Allison (+11447) 7 years ago
Touche. I deserved that.
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Posted by Elizabeth Emilsson (+790) 7 years ago
How can you call it bickering, if there's not a na, na, a naa, na, at the end of the statement?
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Posted by atomicg (+999) 7 years ago
Aren't politics and bickering often synonymous?

Take any issue and polarize it to the extent that folks care enough one way or another to actually vote on it. Voila you have a political issue.

Bickering is just part of the polarizing/political process.


However I don't feel this is a partisan issue (many local matters aren't) so it isn't so much partisan politics as much as a lack of clarity and a populace that can't articulate any clear directive without something on the local ballot to actually vote on. I believe the city council and the mayor vote on this and all the power is in their hands until they give us a local ballot initiative or make the decision to spend the money on a study. Until then, they catch flak from their constituents.


Ultimately the next step is to GET THE DATA because we obviously don't have enough information to solve the problem.
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Posted by Amorette F. Allison (+1910) 7 years ago
They plan to do the feasibility study. They are just trying to get some grants to pay part of the $187,000 cost. The study takes six to nine months. THEN we find out the costs and they will be considerable.
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Posted by Tomm (-1028) 7 years ago
good article in the paper today.
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Posted by Winslow (+382) 7 years ago
Very comprehensive Editorial in the newspaper tonight from the Realtor Association that explains the consequences that we are facing right now. The dike situation needs to get fixed and the longer our city officials wait to get the feasibility study, the harder Miles City is going to get hit with ever increasing flood insurance rates.

I can't imagine paying an additional $351.00 per month (more than $4,000 p/yr) for flood insurance on a $78,000 home. If a homeowner had that kind of money for a house payment, they would be looking at a more expensive home. And rates will continue to increase each year until it reflects the true risk. Will people on fixed incomes be able to afford to own their own homes? Rents will have to increase since that cost will be passed on to the renter.
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Posted by Tomm (-1028) 7 years ago
[deleted - ad]
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Posted by Amorette F. Allison (+1910) 7 years ago
Panicking, however, is not necessary. The whole project will take YEARS to complete. Delaying the preliminary study a few months is not going to make a big difference in the long run. The study itself will take between six and nine months, maybe longer, to complete. Yes, I would like the city to be doing something and they are. They are trying to save us money by waiting until next month. The contract will likely be signed in November.

We have been heading this way for years. It's sad people only noticed it now but we are still YEARS away from a new dike system and lower flood rates. The city flood administrator has earned us some discounts and more will be coming early next year. But brace yourself, we dug ourselves into this hole. Screaming at the city to sign the contract for the study a few weeks early will not actually solve anything.
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Posted by Gunnar Emilsson (+16662) 7 years ago
Amorette is correct.

As most long time readers of mc.com know, I am way smarter than about 90 percent of you.

So here is my prediction:

The Tongue River Railroad will be permitted and built before a FEMA-approved dike system ever gets built in Miles City.

___________________________________________________________

Can we have a big collective, "THANK YOU TEA PARTY!!!"????
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Posted by Richard Bonine, Jr. (+14724) 7 years ago
As most long time readers of mc.com know, I am way smarter than about 90 percent of you.


Really, Gunnar??? I don't for a heartbeat think that there are 953 people (10% of registered users on mc.com) that are smarter than you. In fact, I don't think there are 9 people and Wendy is so smart she would account for 8 of them.

+++++++++++++++++

Buckle your seatbelt, kids. The road to a FEMA approved structure is going to be a long process. There are many issues and jurisdictions to sort out.

[This message has been edited by Richard Bonine, Jr. (9/18/2013)]
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Posted by Amorette F. Allison (+1910) 7 years ago
Plus land will have to be abandoned/condemned near the current dike to provide space for a larger dike which cannot have a road on it, if it is to meet FEMA standards. I suspect we will fight over the dike for years and never get around to building it.

Until the Tongue River Levitating Railroad hums into town.

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Posted by Winslow (+382) 7 years ago
A new dike is likely not feasible....sounds like the solution being discussed is a flood wall which would eliminate the need to condemn or purchase all of the homes/property along the current dike.
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Posted by Elizabeth Emilsson (+790) 7 years ago
Tear down all the houses in the flood plain and put a green zone around Jefferson school. Having just witnessed a 500 hundred year flood from pouring rain here in Denver and another in the New Mexico area I wonder how good a dike is going to be when Mother nature gets pissed.
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Posted by atomicg (+999) 7 years ago
I'd settle for a waiver program that let me opt out altogether.
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Posted by Tomm (-1028) 7 years ago
something that would make this program a little easier to swallow would be if the rates would be set based on autuary studies. Rates need to be set on the amount of risk. most other ins. plans need to use this, and so should the fed. gov. with the flood ins. program. letting the idiots in DC set the rates based on the lossed in the gulf coast losses, Colorado, and minot nd. is stupid. this would take an informed, educated and smart rep. and senator. there are none.....
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Posted by David Schott (+16502) 7 years ago
"Tomm", remind us again why the NFIP was created in the first place.
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Posted by Hannah Nash (+2500) 7 years ago
Link for PDF flyer Local Postal Customers received this week regarding Flooding in Miles City.

http://www.scribd.com/doc...ding-Flyer
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Posted by Jeri Dalbec (+3146) 7 years ago
Question: Would the advent of a new Dike alleviate Elevation Certificates and expensive flood insurance rates and whatever else is covered in the brochure???
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Posted by Winslow (+382) 7 years ago
It's my understanding that after a feasibility study, and if we can fix our flood problem with whatever remedy the study suggests, then Miles City will no longer be subject to flood insurance.

The feasibility study will likely take 9-12 months to complete, at which time Miles City can apply for federal grants to assist with the cost (probably another 6-24 months). Once we've gotten the grant and raised additional tax money for the project, then we need to put it out for bid - and complete construction on the project(probably another 2-3 years).

So as it is, without our city government taking pro-active steps to get the feasibility study completed, we are just sitting and waiting while our insurance rates begin to increase - not by a small amount as previously indicated - but by leaps and bounds.
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Posted by Amorette Allison (+11447) 7 years ago
The new flood control will cost millions of dollars (more than a detention center) and with current deadlock in D.C., don't hold your breath for grants. I suspect a minimum of five to ten years for any relief in that sector. We are sowing what we reaped, both locally and nationally.
Is the situation fair? No. Can we do much to hurry the process? No. Will we probably just have to slog through it? Probably.

It will not be good for the community but we chose to postpone any action on the dike until it was crisis time. Sadly, that time is now.
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Posted by Winslow (+382) 7 years ago
Well if our city representatives don't sign the papers for the feasibility study we will just be kicking the can down the road that much longer! There is no better time to take action than the present.
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Posted by Amorette Allison (+11447) 7 years ago
They are looking for some grant money to fund the study, which will cost $187,000. The delay will be a matter of a few months. When it comes to deciding which option to chose and how to pay for it, a few months won't matter. If they get the $30,000 they are applying for and the county gets the $30,000 THEY are applying for, it will save the city a mere $60,000.
They should know on the grants this month. The contract will probably be signed in November.
Yes, it has been delayed several months but on the scale of the construction, we are talking a very small delay. And they are trying to save taxpayers money. When you see the construction bill, you might be grateful.
No matter what the city does, it will be YEARS before flood insurance will go away. My educated guess is a minimum of five years. Even if they signed the contract for the study six months ago, it will still take years.
Some people seem to think the study will change the flood insurance. It won't. Only construction of a new levee system will do that. The feasibility study is the first step in a long and expensive process.
And as for how much your insurance will go up, ask your agent. Some people may see big increases. Some people will see small increases. Some banks will require more insurance than others. Some lenders require flood insurance even if you have LOMA. Every case will be different. Panicking and screaming at the city to sign the feasibility study contract won't change that either.
Again, the study will not change the flood insurance issue. Only a dike will change that and, again, that will take YEARS and cost MILLIONS.

[This message has been edited by Amorette Allison (9/29/2013)]
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Posted by Cory Cutting (+1277) 7 years ago
Here's the one thing I have learned... And Mrs. Emilsson will back me on this..... Many many of us Coloradoans don't live near a river, yet 'flooding' damaged houses all around. Even a drainage ditch will flood with enough water.

I live in "the middle" of the metro area. This afternoon there were FEMA investigators going to my neighbors' homes for damage. Lots of damage in houses all around me. I was lucky and had none.

I didn't see a need for flood insurance in the middle of the city. But my mind has changed. MC definitely needs it, no matter if its a dike or a complete flood wall.

Oh, and by the way, as a person who spent weeks in New Orleans, I don't think a flood wall is all that much better!!!
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Posted by Bridgier (+8985) 7 years ago
This afternoon there were FEMA investigators going to my neighbors' homes for damage.


I heard that essential government workers were designated so by the wearing of a tricorn hat - was this true?
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Posted by Cory Cutting (+1277) 7 years ago
No but they were flashing their Federal insurance cards as identification.
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Posted by Tomm (-1028) 7 years ago
Tomm", remind us again why the NFIP was created in the first place.

In the 1960s, the fed. gov. started the flood insurance program and the regulations along with the NFIP. Congress felt the need to have a program to collect money from the people in the known flood areas to help pay the costs of the government disaster payments. The original plan was for the program to be subsidized by the gov. and the premium would increase every October until the premium income would cover the government disaster payments for floods and coastal storms. Over the years FEMA has spent money for these disasters and made large payments to people that did not have any flood insurance.
Another part of the program was to regulate buildings in the flood zone, and eventually turn the flood prone areas into parks. Over the years, the building regulations have been ignored, and the gov. has allowed heavy construction in these flood prone areas.
The program was a good idea, and if the government would have followed it's own rules, it would work. Now the way the gov. spends HUGE amounts in the problem areas, it will never pay for itself. So, now a new catch-up bill was passed in 2012 that makes an attempt to make the NFIP pay it's way. It never will as long as they allow building in flood prone areas.
In my opinion, the only solution to completely eliminating the flood insurance problem in Miles City would be to get our congressmen in DC to get a bill passed that would pay the cost of a dike. FAT CHANCE.
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Posted by Amorette Allison (+11447) 7 years ago
The NFIP was created when private insurers refused to sell flood insurance because it wasn't profitable. So the Feds took over. Now the Feds want to privatize. What goes around comes around.
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Posted by Tomm (-1028) 7 years ago
A simple question was asked of the private companies. "Can you insure property against floods?"
The answer was no.
See, they were correct. Setting correct actuarial rates was not possible at that time because there was not enough history. Now with the records kept, and computer programs, I think actuaries could set a proper rate for any structure in the country.
The problem is that if the rates were proper, it would cause very high premiums for the propertied near rivers and lakes.
Who owns a lot of property in these areas??? The wealthy. When the wealthy don't want something it does not get passed.
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Posted by David Schott (+16502) 7 years ago
A lot of not-so-wealthy people own property in flood-prone areas and they need subsidized flood insurance as much as the wealthy. Moreso, really.
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Posted by Tomm (-1028) 7 years ago
I agree, but just pointed out the history and facts. I can see no way that proper actuary rates would be affordable. Fed. subsidies will always be needed.
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