Conservative groups urge Congress to resist gutting flood reforms
The letter coincides with today’s hearing of the Senate Banking Subcommittee on Economic Policy to look at implementation of the Biggert-Waters Flood Insurance Act of 2012. Enacted one year ago, the law makes crucial reforms to the National Flood Insurance Program, including a phase-out of subsidies to transition more participants to risk-based rates.
However, recently, some lawmakers have called for delaying these improvements, despite the troubled state of the program that is now some $28 billion in debt to taxpayers.
“Persistent subsidies for flood-prone areas will place more people and more property in the path of the next big storm, raising both the human and financial cost of any significant weather event,” the groups wrote. “At a time when our nation faces tough fiscal challenges, the market-based reforms in Biggert-Waters put the deeply indebted flood insurance program on sounder fiscal footing by scaling back huge taxpayer subsidies.”
The groups added that in areas where the NFIP operates, 29 percent of subsidized properties are in counties with the highest 10 percent of income, and 43 percent of subsidized properties are in counties in the top 10 percent of home values. Moreover, recently released flood maps from the Federal Emergency Management Agency cast doubt on some of the wilder claims of massive rate increases for those whose subsidies are phased out.
“The universe of homes facing large hikes is very small and consists mostly of areas with extraordinary risk resulting in a total loss roughly once every ten years, properties for which mitigation or buyouts might be appropriate,” the groups wrote.
In addition to the R Street Institute, other signatories to the letter include representatives of Americans for Prosperity, the American Consumer Institute, ConservAmerica, FreedomWorks, Less Government, National Taxpayers Union , Taxpayers for Common Sense and Taxpayers Protection Alliance.
Text of the full letter can be found at: http://www.rstreet.org/wp-content/uploads/2013/09/L13-09-18-NFIP-Delay.pdf