In the coastal areas of Greenwich, Conn., the latest housing craze requires hydraulic jacks, pylons and stilts. One home towers over its neighbors like a cruise ship. Others look like expensive treehouses.
“People are stopping in to ask us about it,” said Patrick Grasso, 59, a resident of the hedge-fund enclave who jacked up his 1920s waterfront house about 3 feet. “People want to know how long did it take and how much did it cost.”
Ten months after Hurricane Sandy, Greenwich is among the first U.S. municipalities to adopt revised flood maps from the Federal Emergency Management Agency that predict fiercer waves and higher storm surges. In doing so, the town has fallen in line with a federal initiative meant to thin the density of low-lying coastal populations, prepare for more damaging weather and reduce rebuilding costs borne by taxpayers.
The maps add as much as 5 feet to previous predictions of how high the waters of Long Island Sound would rise during a 100-year storm like Sandy. Starting next year, homes in surge areas across the country won’t qualify for flood-insurance rates based on the old maps. That means some homeowners will face a choice between paying as much as $150,000 to raise their houses or accepting premium increases as high as $20,000 a year.
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Greenwich will soon have company. Over the next four years, coastal communities in about 350 counties are set to receive new maps. Adoption is voluntary, though there’s an incentive: Towns wishing to remain in the National Flood Insurance Program, which insures 5.6 million homes, must accept the maps. Banks typically require homeowners in coastal areas to have flood insurance to secure a mortgage.
The federal government is focusing first on remapping the East Coast and Gulf Coast. Draft plans have added 180,000 residents in New York City and 32,000 homes in New Jersey to flood plains. Preliminary maps on the West Coast are set for the next two years, and the Great Lakes and Florida will get them in 2015 and 2016.
In Greenwich, home to several hedge funds, the median value of a house is almost $1 million and many are at risk. Tougher standards were adopted for 20 percent of the residences in the Old Greenwich section. The neighborhood, which hugs the sound, is the nation’s 11th wealthiest Zip code, according to data compiled by Bloomberg.
Many of the first Greenwich residents to lift their homes suffered so much damage during Sandy they had no choice: Repairs exceeded 50 percent of the value of the home, which triggered a federal rule requiring the structure to be rebuilt higher.
The Ekvalls in Old Greenwich are a typical example. Sandy’s tidal surge sent water up to the kitchen countertops of their 1930s cottage, which was 6.5 feet above sea level. They decided to raise the first level to 15.5 feet, higher than the 14 feet required by the town under the federal maps. Now the roof is 43 feet high.
“You are really in the trees,” said Patricia Ekvall, 54, showing off a third-floor view of the tops of weeping willows. From there, she can see several other homes that have been elevated or are in the process.
The Ekvalls, whose property was assessed at $816,690 before the renovation, spent more than $300,000 on the project. They drilled steel pins through the muck below and then lifted the house onto stilts. In the next major flood, water will be able to flow under the house like a river below a bridge.
The elevation, while expensive, sent their flood insurance down to $458 year. Had they not raised the house, it would have been 6 feet below the new required height and their annual flood-insurance cost would have soared next year to $5,500, she said.
Neighbors — even those with far less damage — are considering the same move, said Denise Savageau, the town’s conservation director, who is coordinating federal Sandy relief grants to help owners raise houses.
“They realize the water was lapping so very close,” Savageau said.
Waters are rising elsewhere as well. Extreme weather caused by global warming is an increasing problem, according to President Obama and state and local government officials. New York Mayor Michael Bloomberg has called for a $60 billion system of flood barriers to protect the city from tidal surges. (The mayor is the founder and majority owner of Bloomberg News parent Bloomberg LP.)
New York state now lists climate change as a risk to bondholders after Sandy caused more than $40 billion in damage last year, and New Jersey is building dunes to protect its 127-mile coastline.
Under the new FEMA maps, homes more than 4 feet below flood levels may see premiums jump to $10,700 a year from $3,600, according to data provided by the agency. In some cases, annual insurance will rise to $23,150 a year, according to Resources for the Future, a Washington-based group studying the effects of the changes.
The looming increases stem from a law passed by Congress last year to shore up finances at the National Flood Insurance Program. The system owes $24 billion to the U.S. Treasury, according to FEMA.
“By subsidizing risk, we are encouraging people to build in areas they shouldn’t build and putting that on the taxpayers,” said R.J. Lehmann, a senior fellow at R Street Institute, a Washington-based research organization.
“It is a wrenching process, but as we see sea levels rise and as we see global warming, we are going to see more of this,” said Lehmann, who helped write the law sponsored by Representatives Maxine Waters, a California Democrat, and Judy Biggert, an Illinois Republican.
Lehmann said the legislation was backed by fiscal conservatives who want to shift the financial burden of waterfront living to homeowners from all taxpayers, and environmentalists who say cheap flood insurance leads to development in sensitive areas.
Outcry in poorer areas
In other, poorer parts of the nation, there’s more outcry over the proposed maps.
Bill Bubrig, 47, an insurance agent in Belle Chasse, La., says his insurance costs will rise to $15,000 a year from $600 if his community adopts maps that would put his home 6 feet below required levels.
“This is devastating,” he said. “This is going to be worse than Hurricane Katrina. This will cripple the area.”
Rather than lifting his home, he’s lobbying for change. This summer he traveled to Washington on a mission to halt the insurance increases with a new group based in New Orleans called the Coalition for Sustainable Flood Insurance.
Another organization, Stop FEMA Now, based in Toms River, N.J., is planning rallies against the insurance increases in late September.
“We have to get communities together to make this a national issue,” said George Kasimos, who founded the group.
Opponents say they are making progress. In March, FEMA said it wouldn’t apply the new rates until next year. Sen. Mary Landrieu, D-La., is pushing legislation that would halt implementation until an affordability study is complete.
Federal lawmakers didn’t realize that the new maps would cause such spikes in insurance rates, said Caitlin Berni, a spokeswoman for the coalition.
“This was the biggest case of unintended consequences,” Berni said.