Federal flood insurance now covers shoreline erosion demolition and relocation

What it does

This bill expands the National Flood Insurance Program to cover demolition or relocation costs for homes on eroding shorelines that are condemned or deemed unsafe by state/local authorities. Homeowners can receive up to 40% of the structure's value upfront for demolition, or up to 40% for relocation costs; if demolition occurs within 6 months, they receive the remaining 60% (capped at actual demolition cost). Total payouts are capped at $250,000 per structure. After a payout, no further flood insurance or disaster relief is available for that property.

Why we flagged it

The bill's core mechanism is a straightforward expansion of federal flood insurance to cover demolition and relocation costs for structures threatened by shoreline erosion. It is a public-safety and property-protection measure, not a deregulation, tax carve-out, or commemorative provision.

What the text implies

• The $250,000 cap may be insufficient for relocation costs in high-value coastal markets, potentially leaving homeowners with significant out-of-pocket expenses despite federal assistance.
• The permanent termination of coverage and disaster relief for the property after payout may discourage claims, as homeowners lose all future protection; this could suppress uptake of the program.
• The requirement for 12 months of prior coverage (or 4 years continuous coverage) excludes newly purchased properties and those with recent lapsed policies, limiting access for vulnerable buyers.
• Relocation assistance is capped at actual relocation cost, not the structure's value, creating a potential gap if relocation exceeds 40% of property value.
• The bill does not address whether relocated structures retain flood insurance eligibility at new locations, creating uncertainty about long-term coverage.

Section numbers refer to the bill text the analysis read — linked under Primary records below.

Who it affects

Homeowners facing imminent shoreline collapse gain access to federal insurance payouts (up to $250,000) to demolish or relocate endangered structures, reducing personal financial catastrophe and enabling managed retreat from hazardous land. However, the one-time payout and permanent loss of future coverage creates a trade-off: citizens must choose between demolition/relocation or losing all insurance protection.

Who stands to gain

• homeowners with flood-insured properties on eroding shorelines
• demolition and relocation contractors
• National Flood Insurance Program (federal budget impact)

Named in the bill

National Flood Insurance Program, National Flood Insurance Act of 1968, Section 1306, Administrator (FEMA), State and local authorities, Disaster Relief Act of 1974

Where it stands

4 cosponsors: 2 Democrats, 2 Republicans.

• May 1, 2025 — Introduced · Congress.gov: “Introduced in House”
• May 1, 2025 — Referred to House Committee on Financial Services · Congress.gov: “Referred to the House Committee on Financial Services”

Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.

Money around this bill

2 lobbying clients named this bill on 4 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $3,740,000 in lobbying spend. A filing names 78 bills on average, so that figure is what each filing reported, not a share belonging to this bill.

More lobbying clients named this bill than 41% of bills with at least one filing.

Gregory Murphy, the sponsor, reported $1,068,698 in PAC receipts in the 2026 cycle.

• American Property Casualty Insurance Association — $3,540,000 on 2 filings
• Southern Environmental Law Center — $200,000 on 2 filings

Lobbying Disclosure Act filings through Jul 22, 2026. A filing shows who paid to lobby on a bill it names, not what changed.