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Informational Memorandum
Subject:Mandatory Flood Insurance Requirements etc.
Date of Memorandum:07/29/1998
Expiration Date:
Office:OE
Signed By:Smith, Roland
FCA Contact Person:Miller, Charlotte
Contact Phone:703-883-4272
List of Attachments:OCC Bulletin98-24 & FEMA Publication
INFORMATIONAL MEMORANDUM
July 29, 1998 To: The Chief Executive Officer
All Farm Credit System Institutions

From: Roland E. Smith, Director /s/
Office of Examination

Subject: Mandatory Flood Insurance Requirements for Buildings and Mobile Homes Located Within Zone AR


Effective July 6, 1998, Federal flood insurance purchase requirements became mandatory for buildings and mobile homes located within Zone AR (flood control restoration zone) in the Los Angeles and Sacramento areas (as described in the attached OCC Bulletin 98-4). The Zone AR is a flood insurance rate zone that designates an area where a flood protection system is being restored to provide protection during a base flood event. This designation, which became effective on November 26, 1997, indicates that the increased flood hazard is considered temporary until the flood protection system can again provide base flood protection. Other areas could receive this designation in the future.

As in all Special Flood Hazard areas, the Federal flood insurance purchase requirement applies in Zone AR. This means that flood insurance coverage is required if a building or mobile home securing a loan is located in Zone AR of a community participating in the National Flood Insurance Program. Also attached is the Federal Emergency Management Agency publication "Questions and Answers—Background of Zone AR" and the final rule implementing Zone AR which was published in the Federal Register on October 27, 1997, (61 FR 55706).

The Farm Credit Administration is providing this information as a courtesy to keep you informed of developments that may impact your institution. However, these mailings should not be seen as a replacement for, but rather as a complement to, management's due diligence in monitoring issues that may affect your institution.

If you have any questions, please call Charlotte Miller, FCA Examiner, Special Examination and Supervision Division, Office of Examination, at (703) 883-4272, or on the Internet at e-mail address millerc@fca.gov.

Attachments