Chaney proposes re-interpretation of FEMA’s ‘50% rule’

For Pinellas residents attempting to rebuild after the twin destruction of Hurricanes Helene and Milton, permitting challenges have been a confusing, time-consuming headache. One of the greatest is the Federal Emergency Management Agency’s (FEMA) “50% rule,” stating that any home for which repairs or renovations exceed half of the home’s value must be fully brought up to current housing codes. 

State Rep. Linda Chaney (R–St. Pete Beach) wants to change the law to make it easier for homeowners to fall within that rule. “I had residents coming to me saying that there were situations where they were being limited from securing their homes from storms,” she said.

Those complaints drove Chaney to commission a study from Florida’s Office of Insurance Regulation on permitting for storm recovery and mitigation. Based on the results of that study, she’s proposing a change to state law creating a maximum “lookback” period for interpreting the 50% rule in communities across the state. Such a change could impact resiliency, construction, and flood insurance rates across Florida.

“Lookbacks” come into play for homeowners whose properties are covered by the National Flood Insurance Program (NFIP), the FEMA program that underwrites flood coverage for virtually every insured Floridian home. A lookback counts any work completed on the house within a specified period of time (which can be as long as 5+ years) when determining what counts towards the 50% rule.

For example, a homeowner living in a one-story house valued at $200,000 could conduct $100,000 in improvements – whether renovations or repairs – before triggering the “50% rule.” However, in a community with a 5-year lookback, someone spending $20,000 on installing impact windows two years before a flood event would leave them able to spend only $80,000 on repairs before triggering the rule.

For the approximately four in 10 Pinellas County homes located in the lowest-lying Coastal High Hazard Area, triggering the 50% rule would mean raising or rebuilding houses so their primary living space is at least 10 feet above sea level. Lifting existing homes in this way can cost hundreds of thousands of dollars and take a year or more to complete. For many families, that could mean being unable to return to their homes and a forced sale for lot value.

Chaney used the example of a house flipper who purchases a property, quickly renovates it and then resells it to a family as their primary home. In communities with a long lookback period, that family may be unable to receive a permit for improvements like hurricane impact windows or shutters if the previous owner’s renovations came close to the 50% mark.

The OIR study suggested that 14.5% of homeowners have been denied permits due to a lookback period. Many would have no way of knowing this could happen before they pull permits – the impact of previous renovations on a lookback are not disclosed as part of the homebuying process.

Changing the law is not without risk. The NFIP’s Community Rating System (CRS), offers discounts on flood insurance for communities who comply with more stringent standards for storm mitigation and reconstruction. One of these standards is the lookback period – a standard long thought to be a lynchpin of the calculation. Unincorporated Pinellas County, with a 1-year lookback, receives a 40% discount on NFIP flood insurance; in St. Petersburg, with no lookback, homeowners receive a 25% discount.

Chaney’s study with the OIR, however, suggests that the impact would be minimal. They found that only 12 Florida communities would see a discount reduction of 5% as a result of changing lookback policies, with an average annual cost of just $36 to homeowners. Chaney said those communities could potentially mitigate that by improving their building codes or resiliency measures in other ways.

“The CRS rating system has 19 different elements in it that earns a community discounts for flood insurance,” she said. “It could be as simple as educating your community, or maybe more complex [solutions] like let’s have more green space.”

Community advocates spoke favorably of the plan. “Lookback periods should be ZERO, but the limit should be one year after a calamity event,” realtor (and Shore Acres Civic Association President) Kevin Batdorf said. 90% of the homes in his neighborhood suffered major damage in 2024.

He noted that in St. Petersburg, which like unincorporated Pinellas uses a 49% standard, there is no lookback period. The threshold comes into play only amongst permits opened simultaneously. Once a permit is closed, a new one can be opened and the threshold resets.

Republican County Commission Chair Kathleen Peters expressed her agreement with Chaney’s proposal. “Many cities have no look back and others are removing [it],” she noted.

Chaney’s House colleague Rep. Lindsay Cross (D–St. Petersburg) said she would “likely” support such a bill. She questioned why those who improved their homes should be held to a higher standard than those who did not.

However, she cautioned, “What I don’t want to see is for us to continue to find ways to get just to the edge of the rules” without ensuring continuous improvements in community resiliency.

Chaney hopes to put her proposals in front of the Legislature in the 2025 session as a starting point to additional support for homeowners. She’s currently in the process of canvassing support amongst her colleagues for the change.

“We all want more resilient communities. But we also have to let property owners make their own decisions.

“That’s also their property. That’s the largest investment of their life.”