PROTECTING RENTERS FROM FLOOD LOSS.

Date01 February 2022
AuthorHeiman, Ellen R.

INTRODUCTION

In the summer of 2020, Amanda Daniels found herself, for the third time, in a flooded apartment that she rented in Chicago. (1) Over the past five years, Daniels had lost $10,000 worth of personal belongings and rented three separate apartments that she learned, too little too late, were prone to flooding during storms. (2) None of Daniels' landlords alerted her to the possibility that those rentals might flood, and she could not recoup her losses, as her general renters' insurance did not cover flood damage. (3)

Just over one-third of all people living in the United States are renters. (4) Renters bear a disproportionate risk of sustaining flood-related harms because they enjoy far fewer legal and economic protections than homeowners. First, renters' insurance, which is often required by landlords, does not cover flood damage. (5) Second, the National Flood Insurance Program ("NFIP"), which homeowners living in the Special Flood Hazard Area ("SFHA") must buy into, (6) is only optional for renters. (7) With limited protections and only limited recourse available--generally retroactive and expensive enforcement options (8)--concerted policy action will be necessary to protect renters as climate change increases storm frequency and magnitude. (9)

To close these information and coverage gaps, some states and municipalities have proposed or passed legislation that requires landlords to disclose to prospective renters if their properties have either flooded in the recent past, are at serious risk of flooding, or both; (10) these requirements, however, still fail to capture the full picture of flood risk, for all at-risk properties.

In this Comment, I will 1) survey the current body of research cataloguing increased flood risk, particularly in urban areas with high proportions of renters and low-income and historically Black communities, 2) analyze the current protective doctrine under landlord-tenant and tort law, along with state and municipal codes that require flood risk disclosure to renters, and 3) argue that these disclosure laws, while perhaps a necessary step in increasing transparency and communication with renters, fail to promote equity because disclosures rarely change consumer behavior and renters often do not have bargaining power or the flexibility to seek higher ground. Rather, the disclosure must be required along with NFIP reform that requires landlords to properly mitigate all rental properties to reduce flood risk, update flood maps every five years, and incorporate future flood risk and stormwater risk into flood maps.

  1. A CONFLUENCE OF RISK FACTORS: AN OVERVIEW OF THE PROBLEM

    Flooding is increasing across the globe. A warming atmosphere (11)--like ours--can hold, and subsequently release, more water. (12) The United States experiences this increase in frequency and magnitude; recent estimates that account for climate-driven weather find that about 15 million properties in the US are currently at significant risk of flooding. (13) Relatedly, the Federal Emergency Management Agency ("FEMA") has found that by 2100, the SFHA--the areas in our country that are within the 1% annual chance floodplain--will increase by 40% to 45%. (14) The world will see significant increases in storms, flooding, and flood damage over the rest of this century. (15) With global yearly economic losses from flooding regularly in the tens of billions of dollars, flooding is not only a climate and a housing crisis, but an economic one, too. (16)

    Beyond the challenge of flooding generally, the problem of urban flooding presents unique risks. (17) Urban flooding is "a growing source of significant economic loss, social disruption, and housing inequality." (18) The Center for Disaster Resilience and the Center for Texas Beaches and Shores have done extensive research to understand why urban flooding happens; significant factors include old and inadequate drainage systems, runoff increase due to large amounts of impermeable surface, sewage and stormwater backups, changes to infrastructure and physical conditions that impair drainage, and failures to maintain drainage systems adequately. (19) These factors, which are often unique to dense urban areas, exacerbate the problem of flooding in America's larger cities. In turn, urban flooding creates acute public health concerns, both direct health concerns including exposure to storm impact and post-storm hazards like power outages and secondary health concerns like contaminated drinking water and floodwaters, mold and moisture in affected housing, and trauma and stress experienced during and after a flood event. (20) With renters making up over half of the residents in many major American cities, urban flooding makes the risk of flood damage even more salient to renters. (21)

    Any thorough discussion about flood risk to renters must recognize the intersectionality of the problem--that is, that an interconnected and compounding system of disadvantage affects individuals who possess multiple historically disadvantaged social identities. (22) To start, people of color are more likely to rent than to own (23) for a host of reasons: discriminatory housing, (24) tax, (25) income, (26) and real estate and banking policies, (27) to name a few. These same policies are responsible for the disproportionate number of people of color who live in flood prone areas. (28) Further, research suggests that the risk of flooding and a lack of understanding about that risk hurts lowincome communities more than wealthier communities because of a lack of savings and safety nets. (29) More so, underground and basement level units are often the most affordable, again exposing more affordable units to higher risks of flooding. (30) Finally, low-income people are less likely to succeed in gaining access to disaster assistance following a flood. (31)

    Flood damage is a risk for all renters and homeowners. But it presents compounded concerns for people of color and low-income renters. As Professor Kimberle Crenshaw pointed out when she first wrote about intersectionality, if we keep the urgency of the problem for the most disadvantaged renters at the forefront, all renters will benefit. (32) This approach, recognizing the "diverse social, economic, and ecological concerns" that impact the safety of a community, is exactly what environmental justice advocates propose. (33) Protecting renters from flood damage is an issue of racial and economic justice.

    The problem of flood risk is further exacerbated because people generally misunderstand (that is, underestimate) their home's flood risk. (34) This is due to incomplete or poorly timed disclosure requirements, (35) outdated maps, (36) and an in-or-out dichotomy that communicates a false sense of safety. (37) We have robust data about flood history and risks, but people do not receive the information they need in a way that is useful in making decisions. (38) Even in localities where disclosure is required, (39) disclosure is incomplete: it requires disclosure of recent flood history, or sometimes disclosure of whether the property is in the SFHA. However, disclosure that a property is in the SFHA is still incomplete, as the United States' flood maps do not present a comprehensive picture of flood risk in our communities. (40)

    Discussion of the shortcomings of SFHA flood maps and their impact of renters' and homeowners' underestimation of flood risk requires some background on the purpose and creation of the SFHA maps. FEMA publishes flood maps that delineate the 1% annual chance floodplain (known as the "100-year flood") and the 0.2% annual chance floodplain (known as the "500-year flood") and is required to update flood maps every five years. (41) Technically, if the map is not reassessed within that five-year window, the level of flood risk is "unknown," as risk changes over time due to a myriad of factors, including development and changing land use. (42)

    But most flood maps are outdated. (43) New research estimates that the total number of those exposed to serious flooding in the United States is 260 to 310% higher than FEMA's maps suggest, due to a few fatal flaws in FEMA's methodology: FEMA relies only on past flood data, rather than future risk based on increased storm frequency and magnitude and sea-level rise, and it has failed to update over half of the nation's flood maps. (44)

    Beyond just the maps' outdatedness, their in-or-out standards of what is in a flood zone and what is not give a false impression of safety to those outside the SFFfA. (45) Use of the phrase "100-year floodplain" even minimizes the very salient risk to those homes and properties within the SFFLA--it makes a major flood event seem like a distant and rare occasion! (46)

    Our flood maps fail to account for key risk factors, leading to vast underestimation of which properties are at flood risk. FEMA's flood maps do not account for all sources of risk, and perhaps most notably, exclude rainfall flooding! (47)

    Finally, our flood maps do not take future risk into account. (48) In so excluding future risk, they fail to capture the existential truth that soon, taking into account the effects of climate change, these "100-year floods" will become annual occurrences in parts of the nation. (49)

    Given the flaws in how we perceive flood risk as binary, how often our flood maps are updated, and the incomplete metrics we use to assess flood risk, our flood maps vastly underestimate who is at risk of flood damage, which in part explains why so many of those individuals experiencing flood damage in recent history believed they were not at risk. (50)

    Despite the lack of transparency around flood risk, residents must seek flood insurance independently, as it is not included in either renter's or homeowner's insurance. (51) Coupled with the underestimation of risk plaguing both homeowners and renters, this creates a perfect storm for financial ruin for individuals who...

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