We have a branch in a community that FEMA has suspended effective 12/22/16. I think I've figured out most questions, but I would like to hear from anyone who has gone through this. What were your issues? I may have overlooked something, so I want to hear anything you might have as something to think about. What happens on loans that are in a flood zone made during the suspension when (if?) the community gets reinstated. Do we then have to notify those customers that insurance is now required? Do we do this only if the loan increased/renewed/extended?

Suspension

Flood insurance may not be sold or renewed in communities that are suspended from the NFIP. When a community is suspended, coverage remains in effect until expiration. These policies cannot be renewed.

Since they are no longer eligible for a NFIP policy, the flood regulations are also suspended until such time as the suspension is lifted, at which time the borrower would have to re-apply for a new policy. If the policy expired during the suspension, you would mail the 45 day letter at the time of reinstatement.

It is pretty rare that a community actually gets suspended - although many communities get themselves on the pre-suspension notice.

Are you sure they actually got suspended??

They are listed in the federal register. I caught wind of it from the BankersOnline Daily Compliance Briefing from December 5. I called our examiners (the OCC) and they hadn't heard anything about it. I know there were recent map revisions that added quite a bit of area in the zones requiring flood insurance. One of the bad things is that you can't make MPF loans on those properties if the community isn't participating.

Give me the community name

It's numerous communities in Sedgwick County in Kansas. The Federal Register citation reflecting it is 81 FR 87467. It's effective December 22, 2016. I have had a hard time even finding anything that says why they are being suspended.

The latest status of any community can be found here:

https://www.fema.gov/national-flood-insurance-program-community-status-book

Check right after the 22nd

OK, thanks Randy.

The notices that we provide in the Morning Compliance Briefing are meant to alert our readers that FEMA has published their intent to suspend the communities. The Federal Register notices indicate that, if the communities for some reason aren't suspended, another notice will be published in the FR. But I have never seen such a "never mind" notice there. As Randy noted, there is a status "book" that can be checked.

Most of the time, FEMA posts its notices of impending suspension with a few weeks' lead time. But sometimes, there's little advance notice.

As I indicated earlier, there were several map changes recently proposed. If the local governments disagreed with those proposed changes, would that be the reason they were suspended?

A community can be suspended from the NFIP for failure to adopt compliant floodplain management measures or if it repeals or amends previously compliant floodplain management measures. A community can also be suspended from the NFIP for failure to enforce its floodplain management regulations.

We have just seen the same thing in the FR for communities in our area due to non-compliance with floodplain management
requirements. The suspension is to take effect on Feb. 2, 2018. I suspect it also may be due to the recent flood map being the current effective map date of Feb. 2, 2018.

Just to be clear, if we determine a property is in a SFHA and the community is Suspended, we can not obtain flood insurance thru the NFIP, but can we make the loan? Is Private Flood Insurance an acceptable option?

For safety and soundness, you could require private insurance. But most communities fix their problems before an actual suspension.

I have a question on communities that do not participate in the National Flood Insurance Program. We have a couple communities that have been suspended for some time. When we pull a flood determination, a flood zone is indicated. We have a few communities who also are also non-participating and the flood zone is shown as NA on the flood determination. I have not been able to figure out what the difference is, and why sometimes a flood zone is shown and other times not. Any help on this would be greatly appreciated.

If it shows NA, it means that they have never participated and therefor the communities have never been mapped. For the suspended communities - the maps exist.

I just found out today that the City of Tulsa, Oklahoma has been suspended. If the current flood policy for a customer is good through November 6th, and the suspension is lifted in September, does that mean that the policy can be renewed and carry on as usual, or will the customer need to reapply?

They have actually been suspended or they announced they are to be suspended?

According to the Community Status Book dated 05/02/19 - they do not show suspended??

It was published today in the Federal Register: https://www.federalregister.gov/documents/2019/05/01/2019-08821/suspension-of-community-eligibility

Unless they appear as suspended in the Community Status Book they would not be suspended. Typically, some communities are last minute under the wire to get the NFIP the information they are pending. If they are suspended, then new flood insurance polices will not be issued (either new or renewed). But if flood insurance is not available, then none is required. Typically, a community is not suspended for long, especially if it is a large community. I would be keeping an eye on the Community Status Book.

https://www.fema.gov/national-flood-insurance-program-community-status-book