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Hundreds in Wyoming face hikes in flood insurance
Question of the Day
CHEYENNE, Wyo. (AP) - Hundreds of property owners in Wyoming receiving subsidized government flood insurance will see their premiums rise at a brisk rate despite a rate relief law President Barack Obama signed Friday.
The law offers instant relief for homeowners hit by premiums that soared by thousands of dollars overnight, but allows price hikes of up to 18 percent for primary homeowners. Businesses and second homes getting subsidies will see premiums spike a mandatory 25 percent per year until they switch to a rate based on the actual risk of flooding.
More than 900 flood insurance policies in Wyoming were receiving federal discounts as of the end of 2012, according to an analysis by The Associated Press of the most recent federal data available.
Nationwide, records from the Federal Emergency Management Agency show that up to 1.1 million people hold subsidized policies that now face cost increases.
The cities of Cheyenne and Rock Springs have the greatest number of subsidized policies in Wyoming with more than 100 each. Officials in both cities say they’ve been successful at reducing the number of properties that require flood insurance in recent years through flood control projects.
In Cheyenne, federal figures show 146 policies receiving federal discounts at the end of 2012. Of those, 44 face annual increases of 25 percent, and 102 face annual increases of 18 percent.
Since the mid-1970s, property owners in Cheyenne have collected on 155 flood insurance claims totaling $685,193.
As of Dec. 31, 2013, there were 318 total flood insurance policies in Cheyenne offering a total of $63 million in coverage. The collective annual premium for the Cheyenne policies was $260,485.
Mike Vinson, storm water engineer for the city of Cheyenne, said the city has completed two major projects in the last 10 years that took a couple of hundred properties out of the designated 100-year flood plain, allowing property owners to drop flood insurance coverage.
Cheyenne prepared master drainage plans in the late 1980s that spelled out a number of drainage improvement projects, Vinson said. He said the city generally asks voters to approve a bond issue every five years or so and then seeks matching money from the state and other sources to address the next project on the list.
In Rock Springs, federal figures show 174 discounted policies as of the end of 2012. Of those, 40 face annual increases of 25 percent, and 134 face increases of 18 percent. Since the mid-1970s, property owners in Rock Springs have submitted 17 claims totaling $37,667, the records show.
Jennifer Shields, Rock Springs city planner, said this week city residents have received notice that their flood insurance rates are rising.
Bitter Creek runs through the old part of Rock Springs, Shields said. “Because that’s the area of the highest density in the city, that’s why we have a high number of policies. Fortunately, it rarely floods,” she said.
As of Dec. 31, 2013, there were 161 flood insurance policies in Rock Springs offering a total of $23.6 million in coverage. The collective annual premium for the policies was $200,369.
“I know Realtors are having a problem too, because houses that are in older parts of town that are in flood zones,” Shields said. “At least in our city, they can’t sell these properties because people can’t afford the flood insurance that goes with them.”
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