We have a borrower who has a boat storage facility that is a pre-engineeered metal structure that relies primarily on it's rigid frames for overall stability. However, there are walls of lightweight gauge metal attached to the frames and they go to about 30 inches from the ground. We force placed flood insurance as the borrower's let policy lapse arguing that this does not meet the definition of a "building" as the walls are not rigid. He even had his engineer send a letter stating that. They are metal. albeit thin, so we think its a building. Question: who makes the final determination on whether this is a building? Who can we call to get the final word? We want to get this straightened out as the borrower is making a huge deal out of this.

I believe the requirement on ground to beginning of wall minimimum is 1 foot.

Metal does not make them not rigid...the height, however, does.

What are you basing your statement on regarding the minimum of 1 foot/ height issue? Does FEMA address this somewhere in the definitions or elsewhere? Additionally, who makes the final call? FEMA?

Thanks

I think it's actually in the FEMA Insurance Manual. Yes, FEMA would rule on that like all things flood insurance.

I'd like to see it, because I can't find it.

I'll see if I can find it.


ETA: I came up empty in every resource so I have gone to the source. I will post the reply once I receive it from lending compliance at dhs.

I hope it hasn't been confused with the definition and requirements for interior load-bearing walls...

The definition of 'rigid' makes sense that the walls would have to come down and be attached across the bottom of the wall and if it doesn't reach all the way to the bottom, it would allow flood waters to enter, so there is some sense there, but I can't honestly remember where I got that info from, it's been too long.

Anyhoo...regardless of the outcome, I'll post whatever response I get.

http://www.fema.gov/national-flood-insurance-program/definitions

•Proper Openings - Enclosures (Applicable to Zones A, A1-A30, AE, AO, AH, AR, and AR Dual)--All enclosures below the lowest elevated floor must be designed to automatically equalize hydrostatic flood forces on exterior walls by allowing for the entry and exit of floodwaters. A minimum of two openings, with positioning on at least two walls, having a total net area of not less than 1 square inch for every square foot of enclosed area subject to flooding must be provided. The bottom of all openings must be no higher than 1 foot above grade.

Yeah, I've read those requirement before, but that covers requirements for hydrostatic or break-away walls as we call them down here. Those requirements have nothing to do with the determination of whether a wall is rigid or not.

What we see often times around here will be a shed with roofing tin for walls. If the walls only go partially down, they aren't rigid in the strict sense of 'stiff'...you can flop and bend the bottom of the sheets.

To be rigid, I would think the bottom of that metal would have to be secured in some way (and that's what I get the impression of from googling rigid and the fema hits that come up). That's been how I've looked at it through the years.

BTW, I haven't had a response back from the Lending Compliance person at FEMA yet...but I will post it when I get it. I truly need to know. As is likely the case with many of you...I deal with a lot of questionable 'out buildings'.

Is this what you were thinking of?

Flood Insurance Manual - GR5

3. Solid Perimeter Foundation Walls
Solid perimeter foundation walls are used as a
means of elevating the building in A Zones and must
contain proper openings to allow for the unimpeded
flow of floodwaters more than 1 foot deep.

Solid perimeter foundation walls are not an
acceptable means of elevating buildings in
V/VE Zones.

No, in fact I've dealt with those in a condo parking garage once...that's openings to let water out/run through...same thing as Dan posted above.

It is possible, however, that someone misinterpreted that at some point in time and it stuck in my head ever since. I know what I remember came from here, but I found nothing searching for it.

Hopefully, FEMA will give an answer...I think it would be helpful!

I called FEMA a couple of times and they never got back with me. Big surprise there. I advised the bank to have their borrower file for a LOMA and submit all the engineer's statements, photographs, etc. I assume they (FEMA) will have to answer that. They might say a LOMA is not the method to go about this. We'll see. At least it will get the borrower off the bank's back. I'm sticking by my original answer that it's a building for now.

I hope to follow up if there was an update after a LOMA request was submitted and who could make the final call to the referenced structure. I have a similar situation but the walls are all the way to the ground level (4 walls and a secured roof). Borrower said it is not a permanent structure. What evidence can we obtain to confirm it is permanently affixed to the ground? Thanks.

I guess you could have an engineer go in and inspect it, but you do not say why you want to know.

If this building is currently in a SFHA, it has to be anchored/attached. You cannot have a structure that is movable in a SFHA or they are violating the community flood plain management rules. In order for the community to participate in the NFIP, they have to adopt those rules. A movable building represents a serious hazard in a flood as it will float and become a battering ram.

So, the borrower cannot have his cake and eat it to. If the building in not anchored and insurable, then he is in violation of the flood ordinances. If he is not in violation of the flood ordinances, then it is an insurable structure.

I am still not sure the basis of your question.

Hey, appreciate your response! As a lender, we ran the SFHDF and it indicated the property is located in Zone AE. The borrower said they have not permanently structure so we are trying to figure out whether the structure met the FEMA's building definition and require flood insurance. Good to learn about your point of flood ordinances violation. Would you mind point me to the community flood plain management rules so I can check them out further? Thanks a bunch!

You really have not told us what sort of building this really is, but you would have to refer to your own community rules for the specific rules in your community, but here are the regulatory requirements:

https://www.ecfr.gov/current/title-44/chapter-I/subchapter-B/part-60/subpart-A/section-60.3

(a)(3)Review all permit applications to determine whether proposed building sites will be reasonably safe from flooding. If a proposed building site is in a flood-prone area, all new construction and substantial improvements shall

(i) be designed (or modified) and adequately anchored to prevent flotation, collapse, or lateral movement of the structure resulting from hydrodynamic and hydrostatic loads, including the effects of buoyancy,



My suggestion is do not go down this road with the borrower. Let them know they need insurance. They can contact an insurance agent who, if the building is not insurable, can give the borrower the specifics as to why not and the borrower can provide you that information. Then you can tell them that you do not make loan on property that does not comply with all local ordinances.

This is all not the responsibility of the bank. The borrower wants a loan from you. They follow your rules or they can go down the street. It is not worth wasting time on borrowers like this and it is definitely not the responsibility of the bank to get into this sort of argument with a borrower.

I have found that when borrowers like this make these sorts of claims, it is the tip of the iceberg as far as troubles with them.

My bad...it is a security guard building in a shipyard (2-story and mounted with security cameras and have a window A/C unit). It is hard not to say it is securely affixed to a concrete based floor.