- Associated Press - Monday, March 24, 2014

PORTLAND, Ore. (AP) - A Ford dealership in the high desert of southeast Oregon is an unlikely place to find dismay with FEMA flood insurance policies.

But that’s where owner Ted Marshall hosted U.S. Rep. Greg Walden last summer, showing him an imaginary line that runs through his service garage. A Federal Emergency Management Agency flood map considers one side of the floor to be in a flood plain. The other side is not.

It baffles him that any part of his business is considered at risk.

“This facility was built in 1910,” Marshall said from downtown Burns. “And since 1910 it has never flooded. Ever.”

The question of what’s in a flood plain and what’s out has become especially important as the government looks to rid the National Flood Insurance Program of $24 billion in debt by ditching artificially cheap policies that have been available for decades.

Congress passed a law two years ago requiring policyholders to start paying rates that reflect the true flood risk at their homes and businesses.

The new prices were so steep, however, that President Barack Obama signed a law Friday that phases in the increases for more than 1 million policyholders, including the owners of more than 9,300 plans in Oregon.

Delaying the sharpest pain has not erased concerns. Even with the congressional action, about 6,800 Oregon homeowners still face annual premium increases as high as 18 percent, compounding year after year, until the government is collecting what it needs to pay out claims. Nearly 2,600 subsidized policies on businesses and second homes with now will be hit with increases of 25 percent each year until they switch to a risk-based rate.

In Burns, more than 100 policyholders are confronting an increase, according to FEMA statistics collected by The Associated Press. That’s not an insignificant number in a city with fewer than 3,000 people.

“If those kinds of increases really happen, all those homes you’re talking about? Probably not sellable,” said Steven Grasty, a top official in Harney County. “You’re probably talking about premiums that are higher than a house payment would be. So who’s going to do that?”

FEMA and the county are working on a mapping update that Grasty hopes will take some homes - and part of the Ford service garage - out of the flood plain. As of now, everything east of the town’s main street, and a bit of the west side, is considered to be in a flood zone.

Southeast Oregon conjures up images of sagebrush rather than storms, but the Silvies River east of downtown has flooded because of rapid snowmelt.

“But the city doesn’t flood,” Grasty said. “The rest of the county does and it’s pretty sparsely populated. I think in any of those events we’ve seen two or three houses get flooded.”

Christine Shirley, who coordinates the national flood insurance program for Oregon, said the complaints aired in Burns are common across the state, including in areas most Oregonians would consider to be at risk of flood, such as the coast. Most of the outrage, she said, comes from those facing premium increases despite never having filed a claim. Of course, insurance only works when some potential claimants don’t use it.

“Most people who carry fire insurance can say their house never burned down,” she said.