My background is finance and I am a bank regulator for the government, so I have much to offer. 

There are now many "private" flood insurance companies competing with the Government run NFIP.

However most contract have a default clause which governs how a breach or contract is typically handled.

Hope these ideas were helpful ---- CharlieI do have a replacement property in Baltimore - it is a cash cow with a government lease on part of the 3 acres with 250 parking spaces, a lounge and a banquet hall that is rented for weekly affairs.

They consistently go for approvals and changes all the time for clients and can likely give a real world knowledge of what will happen.I am in GA not CA but I can tell you pretty much anything the government says verbally is WORTHLESS.

They do taxes and bookkeeping, but are also very knowledgable about the laws governing LLCs, as they also help with the incorporation and taxation of all kinds of companies. 

Not to mention the headache of dealing with government paperwork and employees.You may also have trouble getting an offer accepted vs. a comparable offer with a standard commercial loan. 

I'm heart broken right now cause sellers just decided to cancel the house right before the closing, our closing supposed to be on September 8th and I'm really sad depressed right now, agreement were already signed by both buyers and sellers the inspection were already done even the bank said okay to buying the house. when we asked the sellers why they canceled the deal they said because they has to pay IRS 40k and Government blocked the deal and they can't sell itis there anything I can do cause we wasted 3 months of time and $200 for inspection and we'v also did the insurance for the house.

@Greg Bohn yes as @Angela Smith mentioned, That is how the local government will tax the property.For a very general example, If your tax value is $100,000 and the local tax rate is 1.2%, then you will be taxed $1,200 for that year.

Look for another investor in your area, show him/her the unit, and get their feedback...what do they see that needs repair.Talk to the local government.