How Flood Insurance and Endangered Species Are Connected

By Andrea P. Clark and Scott L. Shapiro on July 26, 2019

Most people would not associate flood insurance with the protection of endangered species. But over the past decade, the Federal Emergency Management Agency (FEMA) has been the target of multiple lawsuits alleging that the agency has violated the Endangered Species Act by not considering the impacts of its flood insurance program on endangered species and their habitat.

In the latest round of litigation, a federal court in California has struck down as arbitrary and capricious an analysis by FEMA that its administration of the National Flood Insurance Program (NFIP) was not likely to adversely affect endangered or threatened species or habitat.


FEMA is the federal agency tasked with disaster mitigation, preparedness, response and recovery planning. As part of that mission, FEMA administers the NFIP, which offers flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding.

As part of its administration of the NFIP, FEMA publishes flood hazard maps called Flood Insurance Rate Maps, or FIRMs. The purpose of a FIRM is to show the areas in a community that are subject to flood risks. FEMA uses the information provided in FIRMs to determine insurance requirements and rates within each mapped community. Information in FIRMS can also dictate whether a community can allow for development.

The purpose of the Endangered Species Act (ESA) is to ensure that federal agencies and departments use their authorities to protect and conserve endangered and threatened species. Section 7 of the Act requires that federal agencies prevent or modify any projects authorized, funded, or carried out by the agencies that are “likely to jeopardize the continued existence of any endangered species or threatened species, or result in the destruction or adverse modification of critical habitat of such species.”

Prior Legal Challenges to the NFIP

Over the past decade, FEMA has been sued multiple times over the relationship between its administration of the NFIP program and the protection of endangered species under the ESA. Because the NFIP program can dictate whether and where development can occur within a community, conservation groups have argued that FEMA’s NFIP program allows building to occur in areas where it otherwise would not. Since most private insurers will not insure homes in such flood-prone areas, absent the NFIP program building in those areas would otherwise not occur. In one case, for example, a court found evidence demonstrating that NFIP insurance was associated with adverse impacts on endangered Key Deer in Monroe County, Florida. See Florida Key Deer v. Michael D. Brown (S.D. Fla., Case No. 90-10037, September 12, 2005 Order). That court issued an injunction prohibiting FEMA from issuing subsidized flood insurance policies for new construction on many parcels in the Florida Keys.

In 2008, in Puget Sound, Washington, a District Court required that FEMA consult with the National Marine Fisheries Service, whose Biological Opinion concluded that the NFIP was actually pushing salmon and orcas toward extinction. See National Wildlife Federation v. FEMA, 345 F.Supp.2d 1151 (W.D. Wash. 2004). As required by the ESA, the Biological Opinion set forth an alternative approach for FEMA that would not result in jeopardy to those species. In other words, FEMA had to re-write its NFIP program for this community to address ESA concerns. FEMA’s new ordinance includes new requirements that development within the floodplain and riparian buffer area be either prohibited or that its impacts to the stream be completely mitigated. Any development in these sensitive areas should be required to use “low impact development.”

In 2009, environmental plaintiffs sued FEMA in Oregon alleging that FEMA violated Section 7 by not consulting with NMFS regarding potential effects of the NFIP on Oregon salmon and steelhead listed as threatened and endangered under the ESA in Oregon.  See Audubon Society of Portland et. al. v. FEMA (D. Ore., Case. No. 3:09-cv-729-HA). In 2010 the parties settled the case, with FEMA agreeing to consult with NMFS on effects of implementation of the NFIP, mapping of floodplains, and the Community Rating System (CRS) for salmon and steelhead. In 2016 NMFS issued a biological opinion concluding that parts of the NFIP could jeopardize endangered salmon species, and proposing reasonable and prudent alternatives. Since that time FEMA has been working to implement the reasonable and prudent alternatives to ensure that local permits do not authorize activities that contribute to the loss of salmon habitat. Recently FEMA decided to delay implementation until 2021 in light of the difficulty in modifying floodplain permit review standards.

A California Court Recently Rejected FEMA’s Nationwide Approach

After years of consulting with the resources agencies and publishing biological opinions (concluding likely jeopardy) for individual regions/states, FEMA decided on a different approach in 2016 when it published a biological evaluation of the potential effects of NFIP nationwide, triggered by proposed revisions to the NFIP. In that biological evaluation, FEMA concluded that the NFIP would not have any effect on species listed as threatened or endangered under the ESA. Importantly, FEMA excluded from its evaluation any effects of floodplain development on listed species, arguing that FEMA is not involved in state and local government land use decisions regarding development (thus there is no federal agency action).

An environmental advocacy group challenged FEMA’s biological evaluation (Ecological Rights Foundation v. FEMA (N. D. Cal., Case No. 17-cv-02788-JD)), arguing that FEMA arbitrarily and capriciously carved out floodplain development from its evaluation of the effects of NFIP on listed species, with no reasonable basis. The District Court agreed, criticizing FEMA’s contention that it has “no role” in issuing or denying local permits for floodplain development. To the contrary, “[the] Evaluation expressly acknowledged FEMA’s broad and deep role in establishing detailed floodplain management criteria and practices, policing participation in NFIP and access to federal insurance based on community adoption and enforcement of the criteria, adjusting insurance premiums under the CRS in light of compliance, and several other measures that directly affect how floodplains are managed.”

The Court concluded that the biological evaluation’s “no effect” determination was arbitrary and capricious, and set it aside.

Going forward, it looks like FEMA will be forced to address ESA compliance on a state-by-state basis, unless it can develop a nationwide approach that adequately describes its role in floodplain management and tailors NFIP implementation accordingly (a daunting task).

Republished with permission from:
The Levee was Dry
Legal updates & commentary on flood risk and floodplain management.

Source Article: How Flood Insurance and Endangered Species Are Connected . (2019, July 26). Retrieved January 7, 2020, from

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