The substantial improvement and substantial damage rules, commonly referred to as the 50% rule, is affected to the extent that a home will now need to be elevated an additional 4 feet higher than it was prior to the REAL rules coming into effect. The 50% rule requires that if a structure undergoes a substantial improvement or damage that exceeds 50% of the improved value of the property, the structure must be made compliant with the most recent floodplain regulations, including those adopted under the REAL rules.

“Substantial improvement” means any reconstruction, rehabilitation, addition, or other improvement of a structure, the cost of which, including the cumulative cost of all improvements made to the structure for the prior ten (10) years, equals or exceeds 50% of the market value of the structure as determined before the start of construction of the improvement. This term includes structures that have sustained substantial damage regardless of the actual repair work performed. Substantial improvement does not include:

  1. Any project for improvement of a structure to correct existing violations of State or local health, sanitary or safety code specifications which have been identified by the local code enforcement officer and which are the minimum necessary to assure safe living conditions; or
  2. Any alteration of a building designated by the State as an historic structure, provided that the alteration will not preclude the structure’s continued designation as an historic structure.