PEQUANNOCK, N.J. — Time after time, as the river has risen and the water has crept up Roosevelt Street, Leni-anne Shuchter has fled the white clapboard home she bought more than four decades ago.
In between, other storms have forced her to file claim after claim with the troubled National Flood Insurance Program so she could rebuild. Yet the small home remains as vulnerable as ever, a reality reflected by its falling value in recent years.
"If I had a choice, I would sell," said the 65-year-old Shuchter, who dreams of retiring to Arizona or Nevada. "I don't need to deal with this anymore. [But] the reality of selling is nil."
The couple’s house is what the federal government defines as a “severe repetitive loss property” — one of many that have been covered over and over again by taxpayers, the cumulative payouts often far exceeding what the structures are worth. Nationwide, 11,000 such properties dot coastal zones or other low-lying areas, and their numbers continue to grow, in part because of the effects of climate change and ongoing development.
One house outside Baton Rouge, valued at $55,921, has flooded 40 times over the years, amassing $428,379 in claims. A $90,000 property near the Mississippi River north of St. Louis has flooded 34 times, racking up claims of more than $608,000. And an oft-flooded Houston home has received more than $1 million in payouts — nearly 15 times its assessed value of $72,400. The data is collected by the Federal Emergency Management Agency, which oversees the insurance program.
The extreme cases are only a fraction of the NFIP's 5 million active policies, but they historically have accounted for about 30 percent of its claims. And while they're a financial albatross for taxpayers, the claims are hardly the program's only challenge.
The NFIP, which must be reauthorized by the end of September, is nearly $25 billion in the red — a debt that administrator Roy Wright says he sees no way to pay back.
“Only Congress can deal with that past loss,” Wright said last week . “What we’re focused on today is ensuring that going forward, we’re putting ourselves on a sound financial footing.”
On Capitol Hill, lawmakers are scrambling to overhaul the half-century-old program. Allowing it to lapse Sept. 30 would risk disrupting the buying and selling of homes in flood-prone areas across the country.
The NFIP has long enjoyed bipartisan support, if for one simple reason. "Where it rains, it can flood, so no one in the country is insulated," said Laura Lightbody, who directs an initiative at the Pew Charitable Trusts aimed at helping communities better prepare for flood risks. "It touches all 50 states."
But not equally. Data shows that some of the worst flooding, and often the most frequent, has occurred along the Gulf Coast of Louisiana and Texas. Houses along the Mississippi River have repeatedly been deluged. And the Atlantic coast from Miami to Boston faces perpetual — and escalating — threats. Although there are certainly beachfront mansions affected, many homes belong to working-class Americans.
Critics have long maintained that although the NFIP was intended to encourage smarter development, its current design too often bails out people in flood-prone areas. In short, it incentivizes staying put, whatever the cost, rather than moving to higher ground. Plus it has had only limited success in discouraging development in questionable areas.
Figuring out how to tackle the program’s problems remains complicated and politically fraught. Lawmakers must decide whether to raise rates — and by how much — on the roughly one in five homeowners who pay below-market premiums mandated by Congress. Making the homeowners pay rates that reflect their true flood risk could shore up the program’s finances; it also could mean sharp premium hikes and a public backlash over affordability.
The same dilemma is part of the reason Congress retreated from its last major effort to fix things five years ago, when a sudden rise in rates caused an outcry in some communities.
“No congressman ever got unelected by providing cheap flood insurance,” said Rob Moore, a senior policy analyst at the Natural Resources Defense Council and an expert on the program.
Some on Capitol Hill are pushing for more private firms to enter the flood insurance market — an idea Wright, the administrator, said he supports — although critics worry that companies could cherry-pick the least troubled properties, leaving the government on the hook for the other addresses.
No matter who the underwriter is, Congress must deal with the thorny question of how best to fund the continued updating of detailed U.S. flood maps. Many are woefully outdated and do not reflect changed flood risks — not to mention future risks from factors such as rising seas. The Trump administration has actually proposed cutting $190 million annually from the mapping work.
Flooding remains the most common and most costly form of natural disaster in the United States, and insurance to protect against it has become increasingly necessary in certain places. A report this month from the Union of Concerned Scientists suggests an ominous future. Within the next two decades, it forecasts that nearly 170 U.S. coastal communities will face chronic inundation, defined as flooding at least 26 times a year. That's almost twice as many at-risk locations as today.
Congress created the flood insurance program in 1968 because the costs of disaster assistance were escalating and private insurers had largely abandoned the market. The program not only requires people purchasing homes in floodplains to take out insurance as a condition of getting a mortgage, but it also provides grants to help mitigate vulnerable properties, either by elevating them or in some cases buying out homeowners and tearing their structures down.
But the latter isn’t happening often enough, according to the NRDC’s Moore.
“It’s helping people stay in places that we know are unwise to stay in,” he said. “The days of flood-rebuild-repeat need to come to an end. We need to do things differently to get out of that cycle.”
The financial woes began when Hurricane Katrina devastated the Gulf Coast in 2005, followed by hurricanes Rita and Wilma. The program paid eight times as many claims that year as in any previous year — and ended up borrowing $17.5 billion from the U.S. treasury.
Hurricane Sandy in 2012 resulted in 144,000 more claims and another $6.25 billion in debt, as well as allegations that thousands of homeowners were wrongfully denied payouts by companies administering flood insurance on FEMA's behalf.
Even in 2016, when there was no singularly catastrophic event, floods in Louisiana, Texas and other states resulted in the third-largest year of payouts in the program’s history.
In a report this spring, the Government Accountability Office detailed the NFIP's fundamental dilemma, saying it "has experienced significant challenges because FEMA is tasked with pursuing competing programmatic goals — keeping flood insurance affordable while keeping the program fiscally solvent."
For all its troubles, lawmakers know that the program affects the lives of millions of Americans and that failing to reauthorize it this fall could cause major upheaval for homeowners and the real estate market.
“Flood disasters today would be truly grim but for NFIP,” said Nicholas Pinter, a geology professor at the University of California at Davis and an expert in flood risks. He added, “It definitely has problems. . . . It needs improving. But it’s a hell of a lot better than it was when there was nothing.”
A House committee last month passed legislation to overhaul and reauthorize the program. If adopted, it would compel communities with persistent flooding problems to develop plans to reduce them and would require more transparency about a property's flood history.
“The American taxpayer [has] been called upon in the past to bail out a program that is currently drowning,” the committee’s chairman, Rep. Jeb Hensarling (R-Tex.), said this spring as lawmakers weighed varying proposals. And although homeowners need to be protected from “sticker shock . . . the program must be made sustainable.”
The Senate also is trying to strengthen the NFIP, with measures proposed to better fund flood mitigation projects, promote the use of high-resolution mapping technology and encourage private insurers to enter the market.
Back on Roosevelt Street in Pequannock, a stone’s throw from the Pompton River, Shuchter and her husband have all but relinquished their dream of retiring and moving, at least for now.
With help from local officials, the couple are in the process of securing a FEMA grant that would raise their 960-square-foot house eight to 10 feet off the ground. The project could begin late this year and cost an estimated $196,000 — $10,000 more than their property’s assessed value.
The work will mean up to six more months living in a hotel. They will return to a home hovering high above its previous site, and stairs Shuchter worries will grow only more daunting as they age.
In the meantime, Shuchter keeps important papers — birth certificates, wills, past flood records — in a waterproof box in the bedroom. She has made digital copies of family pictures. She also has a list of what to quickly grab when the next evacuation call comes, everything from medications to laptops.
She also has bookmarked a National Weather Service website that monitors the flood gauge on the river. On nights when rain is pounding or a storm is swirling, she often stays up late, checking the site to make sure the water hasn't risen to perilous levels. But experience tells her it's only a matter of time.
“I do believe it’s when,” she said. “Not if.”