What percentage determines whether a proposed addition is considered substantial improvement?

The determination of whether a proposed addition is considered a substantial improvement is set at the threshold of 50% of the market value of the structure. This means that if the cost of the proposed addition, when combined with previous improvements made in the past year, exceeds 50% of the structure's market value, it is classified as a substantial improvement.

This classification is significant because it triggers specific requirements under the National Flood Insurance Program (NFIP), including compliance with current floodplain management standards and building codes. These standards are intended to minimize the risk of flood damage and ensure that structures are resilient to flooding.

Values below 50% do not require such strict compliance and can be seen as maintaining the existing pre-improvement status quota. This threshold reflects the NFIP's commitment to reducing flood risk through higher construction standards and promotes safer, more resilient structures in flood-prone areas.