Effort to gut flood insurance reform fails in Senate
S. 1610, the Homeowners Flood Insurance Affordability Act of 2013, would put off indefinitely reforms to the National Flood Insurance program that Congress passed in the Biggert-Waters Flood Insurance Reform Act of 2012. A floor motion to adopt the measure by unanimous consent failed after Sen. Pat Roberts, R-Kansas, objected on the Senate floor.
Among other changes, Biggert-Waters requires the NFIP, which is currently more than $24 billion in debt to the federal treasury, to phase out longstanding premium subsidies for vacation homes, business properties and properties that have suffered severe repetitive losses. It also asks the Federal Emergency Management Agency to update its flood insurance rate maps and, over a four-year period expected to start in October 2014, to phase-in adjustments to policyholders’ premiums to reflect the true risk the properties face.
Sponsored by Sen. Bob Menendez, D-N.J., S. 1610 would halt any increase in rates due to remapping and any decrease in premium subsidies, while also reinstating subsidies that already have begun to be phased out.
“Sen. Menendez’s bill proposes an absurd and protracted process – four years, at minimum — of studies, recommendations, hypothetical and non-amendable future pieces of legislation, and then, for good measure, an extra six months of ramp-up, before a single property would see their rates adjusted to reflect their real risks,” R Street Senior Fellow R.J. Lehmann said. “The unstated, but quite clear, goal of this convoluted process is simply to gut any reform until the NFIP’s existing statutory authority would be scheduled to expire.”
As efforts to roll back Biggert-Waters reforms continue to be debated in both chambers of Congress — including a new House bill from Rep. Bill Cassidy, R-La., that would push back remapping changes for five months – Lehmann urged that any tweaks to the law be considered through a thoughtful and deliberative process.
“To the extent that there are legitimate concerns about affordability or how the Biggert-Waters reforms are implemented, those are best addressed through targeted, limited and means-tested programs considered through regular legislative order,” Lehmann said.
“Simply kicking the can down the road with delays, whether short-term or long-term, fails to grapple with the reality that the flood program is broke, that the benefits being phased out flow disproportionately to wealthy homeowners and that, against the backdrop of rising sea levels and increasingly costly catastrophes, we simply can no longer afford to encourage people to live in flood-prone areas,” he added.