Homeowners in flood-prone areas may soon be getting a reprieve from pending insurance premium increases.
The bipartisan spending bill expected to pass the House and Senate this week would suspend some of the increases mandated by Congress until at least October 2015.
The impending increases sparked an outcry from voters and lawmakers.
“For those of us who experienced Sandy, this is sort of the double whammy,” Sen. Charles Schumer, D- N.Y. said at an event last week hosted by opponents of the premium increases. “Middle-class homeowners scrounged together $80,000, $90,000, or $100,000 to fix their homes, they finally move back in, and a month later somebody knocks on their door and says, ‘You now have to pay $5,000 for flood insurance,’ when they were paying $300 or $400.”
A bill offered by Sen. Robert Menendez, D- N.J., and Sen. Johnny Isakson, R- Ga., would go further than the spending bill in stopping the premium increases and ordering the Federal Emergency Management Agency (FEMA) to re-think how it maps flood-prone areas.
The Senate seems likely to OK the Menendez-Isakson bill as early as this week but it faces conservative opposition in the House.
The 2012 Biggert-Waters Act was an attempt to put the National Flood Insurance Program (NFIP) on a fiscally sound footing. The NFIP is about $24 billion in debt to the Treasury, according to the Government Accountability Office. The premiums are too small to cover its costs, pay claims to flooded homeowners, and repay the Treasury, the GAO said.
Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies, which supports the Biggert-Waters law, said Tuesday, “If Congress is going to delay these important reforms, we hope they will at least use this time to address the actual problems that have arisen in implementing Biggert-Waters rather than trying to undo them altogether in the name of political gain.”