Consultants have privately told the NRA that it should build a channel through which water can be diverted during heavy rainfall. An estimate of the cost is expected to be given in early autumn.
The recommendation follows the flooding of the river Lavant, which runs through the city, this year. Statistics show that the flood was so serious that another on the same scale should not recur for more than a century.
The natural disaster resulted in more than 90 houses in the villages of Singleton, East Dean, Charlton, West Dean, Lavant, Oving and Merston being flooded, along with shops in the Hornet and St Pancras areas of Chichester.
The water cut off the new A27 Westhampnett bypass, the A259 and several minor roads, with businesses on the Westhampnett industrial estate forced to close and farmland waterlogged.
The NRA's present weak standard of defence allows for a flood once every 25 years in the city, despite the government standard that says it should be just once in 100 years, the report reveals.
It adds: 'The damages resulting from the recent event were about pounds 6m. However there is potential for more serious flooding in the event of a culvert blockage (when) at least pounds 16.3m could quickly be sustained.'
Investigations are continuing to determine whether culverts in the city were damaged by the flood, with final examinations due in the next fortnight. The report says preliminary checks suggest they are relatively unaffected.
The NRA report concludes that the flood, the 10th in the area in 158 years, was the result of unusually heavy rainfall causing daily winter flows in the river to swell to four to five times the average.
A second contributory factor was extensive extraction of gravel to the east and south of Chichester which has resulted in abandoned gravel pits filled with waste acting as dams and impeding the flow of the river, the study says.
It also warns that the decision not to commission the culverts recommended by a Department of Transport study to mitigate the effects of the Westhampnett bypass probably lengthened the duration of the flood in the Church Farm Pit area.
Yesterday Peter Midgley, Sussex area manager for the NRA, said the authority hoped to act on the recommendation to divert floodwater from Chichester. Evidence suggests the river may have been artificially diverted towards the city in Roman times.
He said: 'The idea is to build a bypass channel around the city, but not to divert the river permanently because it has high amenity value. But at times of flood it would give us the capability to divert all or part of the water.'