Cedar Rapids to Pay $1 Million Annually on Flood Insurance Premiums
By Rick Smith, Reporter
CEDAR RAPIDS, Iowa In 2009, insurers told City Hall that it might cost $960,000 a year for flood insurance just for the flood-damaged Veterans Memorial Building on May's Island.
In August, Casey Drew, the city's finance director, said the flood-insurance costs for some 50 city building would be much less than first feared, but even so, would cost the city more than $500,000 a year.
Now the dollar figure is more certain.
At its meeting Tuesday afternoon, the City Council is expected to approve the purchase of $25 million in excess flood insurance for a cost of $1,110, 148 for the period from Dec. 1, 2012, through Nov. 30, 2013.
The excess flood insurance is in addition to the city's purchase of basic flood insurance for 49 properties through the National Flood Insurance Program, which provides building-by-building coverage totaling $19.524 million at an annual cost of $85,498.
Factoring into the cost of flood insurance for the city's buildings at risk of flooding is how much risk the city itself is willing to take on in the event of future flooding, Drew said in August.
After the city's flood disaster in June 2008, the city obtained a partial flood-insurance waiver from the federal government. However, the waiver requires the city to buy basic coverage through the National Flood Insurance Program and to spend at least one-third of 1 percent of its total annual operating budget or about $500,000 on premiums for extra flood insurance, Drew has said.