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Committee approves report on bill requiring sellers to provide official FEMA flood map to buyers
Summary
The Economic Development, Housing & General Affairs Committee approved a 2.1 committee report on bill H106 that would require sellers to give buyers a physical or electronic copy—or a digital link—to the official flood insurance rate map; the draft includes a reliance defense and a Sept. 1 effective date change.
The Economic Development, Housing & General Affairs Committee approved a 2.1 committee report on bill H106 that, as drafted, would require a seller to provide a buyer a physical or electronic copy or a digital link to the official flood insurance rate map, committee members said.
Committee members and staff said the change is intended to put potential buyers on notice about flood risk tied to real property purchases and includes a defense if sellers rely on local government records or licensed professionals.
Cameron, a Lehi City Council member who presented the draft, summarized the bill's intent as “to ensure that a buyer of real property is on notice regarding the flood risk associated with the purchase of the real property.” Cameron told the committee the draft shortens the intent language and adds a requirement that “the seller has to provide the buyer with a physical or electronic copy or a digital link of the official flood insurance rate map.”
Cameron said the draft adds language clarifying when a seller must maintain flood insurance: whether the seller maintains it voluntarily or “is required by federal or state law to maintain flood insurance on your property.” The committee also changed an effective date in the draft to Sept. 1, the presenter noted.
Cam (the presenter) and another committee member discussed the meaning of “official” in the phrase “official flood insurance rate map.” Cam said the word was chosen to avoid allowing an outdated or nonstandard map to be used as compliant documentation. Cam also said, “If they're relying on the town or they're relying on a licensed professional to give them the information… then that is a defense for whether or not it's correct.”
Peter, a staff member who commented on mapping sources, said the Federal Emergency Management Agency map is the relevant source: “the map we get from FEMA is the official map. So I think the language is correct.” Committee members discussed timing issues when FEMA updates maps but noted that transactions typically do not span FEMA's update period.
A motion to adopt the committee report (2.1) on bill H106 was made and called for a roll. Clark called the roll; Senators Brock, Chindon, Romington, Ronald Mitchell, Weeks and Torch were recorded as voting yes. David offered to record and file the report; the chair thanked Cameron and others for their work on the draft.
Discussion on the record included the scope of the “official” map, the availability of FEMA maps, the limited timeframes of property transactions relative to map updates, the added seller insurance language, and the Sept. 1 date change. The committee did not on the record change the substance of the reliance defense beyond the language noted above.
