Associated Press/The Wire

Hundreds of property owners have successfully lobbied to pay less in insurance premiums. But they'll receive the same payout if disaster strikes.

Wealthy condo developers and the owners of expensive beach houses are petitioning the Federal Emergency Management Agency to cut them a break on flood insurance costs. Meaning that the long-unbalanced insurance system is only getting more uneven, and taxpayers' subsidies to those property owners are getting more unfair.

Here's how flood insurance works, in the ideal. FEMA develops maps of areas near the coast or inland bodies of water and rivers. Those maps try and anticipate the likelihood of flooding, and if you build in zones that are likely to flood, you pay mandatory insurance premiums linked to the likelihood of it happening. If the property is flooded, FEMA pays out damages from the insurance program.

That's the ideal, anyway. As NBC News' Bill Dedman reports, hundreds of property owners have successfully lobbied to have the zones where their homes — or hotels — are located downgraded. Meaning that they pay less in insurance premiums, but still receive the same payout in the event of disaster.

NBC News also found that FEMA has redrawn maps even for properties that have repeatedly filed claims for flood losses from previous storms. At least some of the properties are on the secret "repetitive loss list" that FEMA sends to communities to alert them to problem properties. … And FEMA has given property owners a break even when the changes are opposed by the town hall official in charge of flood control.

NBC made a map of 500-plus examples of such rezoning. Dedman's article is peppered with photos of beautiful condo towers and hotels and beachside estates. It's pretty decent real estate porn, until you remember that if and when those properties get flooded out, you're going to have to chip in to pay for them.

One of the things we learned in the wake of Hurricane Sandy, you may remember, is that the current flood insurance program was not robust enough to actually pay for the damage caused by the storm. That was in large part because FEMA's flood maps were outdated for the region, meaning that people had been paying too-low premiums for years. Of course, the scale of the storm didn't help, but it threw FEMA into crisis. In January 2012, the agency announced that the program was about to go broke, even after Congress approved $9.7 billion in funding to help the shortfall.

FEMA recently updated its flood maps to better reflect the realities of flooding. But those new insurance rates haven't yet gone into effect, because Congress — hearing from those same sorts of constituents who have the financial wherewithal to hire engineers to petition FEMA to change their flood zone designation — has delayed implementing the new rates. (One of those wealthy constituents told NBC that flood insurance is "a massive scam on the American people.") This inaction an obvious example of putting short-term politics over long-term economics, but, then, this is politics.

The bigger problem is that flooding is only becoming more likely. The FEMA rezoning takes into account higher sea levels that have resulted from climate change — one of the main reasons that lower Manhattan flooded so extensively. The new zones, however, didn't factor in ongoing sea level rise, precisely the thing that will pose an increasing risk to those hotels and condos and estates.

From NBC:

In New York, FEMA granted the Mamaroneck Beach & Yacht Club's request to be remapped from the high-risk flood zone in August 2012 — just two months before the club was damaged and its outbuildings destroyed by Hurricane Sandy, which stacked up yachts at its docks like pick-up sticks. The club told NBC that its engineering study showed that FEMA's map was wrong.

"Sandy was a once in a millennium event, and therefore cannot be the sole determination for planning," said Eric L. Gordon, attorney for the yacht club.

Sandy was not a "once in a millennium" event, not anymore. And when Sandy or Katrina or flooding like the U.K. is seeing happens again, the Mamaroneck Beach & Yacht Club or the Tropic Isles Hotel or whatever will be reimbursed by a cash-strapped FEMA insurance program for that damage. And then, almost certainly, you will reimburse FEMA.

Without even getting a free hotel stay or yacht ride. Maybe after it's destroyed by the flood, you can get an affordable room. You've paid for it.

This post originally appeared on The Wire, an Atlantic partner site.

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