[Congressional Record Volume 160, Number 42 (Thursday, March 13, 2014)]
[Senate]
[Pages S1627-S1632]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
HOMEOWNER FLOOD INSURANCE AFFORDABILITY ACT OF 2013
The PRESIDING OFFICER. Under the previous order, the Senate will
proceed to the consideration of H.R. 3370.
The clerk will report the bill by title.
The legislative clerk read as follows:
A bill (H.R. 3370) to delay the implementation of certain
provisions of the Biggert-Waters Flood Insurance Reform Act
of 2012, and for other purposes.
The PRESIDING OFFICER. Under the previous order, there are now 45
minutes for debate.
The Senator from Utah.
Mr. LEE. Mr. President, this particular bill has not been examined in
committee--not in the Senate, not even in the House. It was rushed to
the floor of the House without amendment, and it is rushed to the floor
here without amendment. This is not how the legislative process is
supposed to work--especially not here in the Senate.
My opponents may say we already had our chance to impact this policy,
but what we have before us now is a different bill--a bill which we
have never seen before. This bill is not a conference report. It takes
zero cues from the Senate bill. Not a single representative of the
American people has been given the opportunity to offer even a single
amendment to this legislation.
All I have been asking for is a vote on an amendment which eliminates
certain insurance rebates for second homes. My amendment would not
change homeowners' flood insurance policies or even reduce the new
taxpayer subsidy we are going to give them. It simply removes a
retroactive reimbursement for second homes. Essentially we ask that
working families around the country, including taxpayers in my State,
not have to cut an additional check to the owners of coastal vacation
houses. I know of no one who objects to my provision on policy grounds.
Let me repeat that. I don't know of anyone, not one person who has
raised a policy objection to
[[Page S1628]]
the amendment I have offered. It is an objective improvement to the
underlying policy and this is what the Senate is supposed to do. Yet
the supporters of the bill have been blocking any amendments that may
garner bipartisan support to hold together a deal that has been
negotiated in a backroom, written in secret by only a few Members,
perhaps with the influence of a few people who may be interested in
that. These ``masters of the universe'' as my friend Senator Sessions
has sometimes referred to them, are shutting the American people out of
the process.
I asked for 10 minutes and a vote on a single unobjectionable germane
amendment to a bill the public has never before seen, but it seems this
may be a bridge too far for the ``masters of the universe,'' as my
friend from Alabama likes to call them.
So in an effort hopefully to change one of the more offensive
policies in the bill, one that provides a refund of premiums paid under
the law to homeowners of second vacation homes from a program that is
already $24 billion in the hole, I agree to a vote on my amendment as a
stand-alone bill. I have assurances from the House majority leader that
he will work to get the policy considered in the House and I take him
at his word.
I urge my colleagues to support my bill to protect the American
people from being asked to fund--to refund premiums paid under current
law to owners of second homes and vacation homes.
Mr. INHOFE. Mr. President, I am opposed to H.R. 3370 because it
abandons the much-needed reforms to the National Flood Insurance
Program, NFIP, that were instituted in the Biggert-Waters Reform Act of
2012. That bill set the NFIP on a course to quickly remove Federal
subsidies from the program and make it actuarially sound. If these
policies had been fully implemented, it would have allowed the
development of a private insurance marketplace for flood insurance,
which does not currently exist. H.R. 3370 prevents flood insurance
policies from being written at an actuarially sound rate when homes are
sold to a new buyer or when a flood insurance policy lapses. New
purchasers of homes in areas that require flood insurance should not be
subsidized for making that decision. H.R. 3370 puts in doubt the hope
that NFIP's subsidies are eliminated.
Thank you, I yield the floor.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. MENENDEZ. Mr. President, I rise to urge a ``yes'' vote for final
passage of the Homeowner Flood Insurance Affordability Act, the
legislation we are here to consider. I will say the Senate went through
a considerate, deliberate process where amendments were openly
considered. I believe at the end of the process there was a 67-to-32
vote. We don't normally get two-thirds of the Senate agreeing on major
issues, but we did at that time in a bipartisan effort.
My understanding is the legislation that ultimately we are
considering today, which is basically foundationally what we agreed to
here with some changes in the House, for which there was vigorous back-
and-forth negotiation, passed by over 300 votes of the House of
Representatives. So it seems to me it has a broad bipartisan support
and was vigorously debated in that Chamber.
We have an opportunity to once again, after the bill we just passed,
show this body can work. We had a respectable debate on good-faith
amendments that were germane to the bill, lived up to the ideals of the
Senate when it was before us. We were able to have bipartisan
negotiations to improve the House-passed version of our bill so it
would provide the levels of relief that are necessary. As a result, we
are now poised to pass some critical legislation with overwhelmingly
bipartisan support which provides real relief to millions of American
families.
Just very briefly, because I hope to basically not use all the time
so we can come to a vote and get our Members on their way, this new
legislation is first of all budget neutral. It does not add a dime to
the deficit, nor does it hurt the solvency of the National Flood
Insurance Program. It prevents skyrocketing rate increases by
implementing the following measures: One, it creates a firewall on
annual rate increases. It repeals the property sales trigger that was
depressing the values of homes. It repeals the new policy sales
trigger. It reinstates grandfathering. It refunds homeowners who
overpaid. It has something that I thought was critically important,
that I thought was so important when we passed Biggert-Waters that I
included it by amendment in the banking committee--an affordability
goal.
Let us have the ability to ensure the solvency of the National Flood
Insurance Program, but let us have an affordability mechanism which
FEMA was, under the law that exists today, required to report to the
Congress so we could ultimately come up with an affordability mechanism
that would ensure that we have a solvent program and that we have an
affordable program.
At the end of the day, insurance is about spreading risk over a wide
pool and in doing so keeping rates affordable. With rates that I heard
from homeowners in New Jersey that went from $1,000 to $10,000 or
$15,000, not only is that not affordable but you are going to
ultimately reduce the size of the risk pool in the National Flood
Insurance Program. That means that is going to continue to drive up the
cost, and we have a self-fulfilling cycle that ultimately does not
provide for solvency.
So we have kept some of the most important reforms under Biggert-
Waters, but we created a window of opportunity to make sure we get to
affordability, that we help the real estate market, at a time when it
desperately needs help, to be able to continue to prosper. The people's
most significant asset in their life was built over a lifetime to buy a
home, and that is where they ultimately have their greatest asset. It
is where they leverage for their kid's education or emergency in health
care and a whole host of plans for retirement.
So for millions of people in my State and across the country who
ultimately did the right thing, followed rules, paid their premiums,
met the higher standards, now to be told that in addition to--in New
Jersey's case the consequences of Hurricane Sandy, and throughout the
Northeast, flooding in Colorado or the Mississippi or a whole host of
other places--but despite the fact they did everything right, through
no fault of their own and having paid their fees, they are now in rate
shock, an inability to keep flood insurance, which sometimes triggers a
default on the mortgage, if they have a mortgage, or makes it
impossible to sell their home.
That is what we are rectifying. It is our collective purpose. I urge
a strong ``yes'' vote.
Finally, I wish to thank my colleagues who have worked with me on a
bipartisan basis: My lead cosponsor Senator Isakson. I don't believe
there is anybody in the Senate who has a greater depth of knowledge in
the real estate industry and how this legislation affects that but also
understands the consequences of individual families and is working in
an incredibly strong way so we can get to this bipartisan moment. I
appreciate all of his work.
Also, I have to say the tenaciousness and the ability to bring us to
this point is that of Senator Landrieu, who has become an expert out of
necessity from what happens in her State with Hurricane Katrina. The
people of Louisiana are extraordinarily fortunate to have her as one of
their Senators. She has been a guiding light throughout this process,
tremendously helpful in getting us to today.
Lastly, I appreciate the leadership on both sides to get us to this
moment so we could have this vote.
With that, I yield the floor.
The PRESIDING OFFICER. The Senator from Georgia.
Mr. ISAKSON. I am going to be very brief in the interest of time. I
wish to thank Senator Menendez for his leadership, Senator Landrieu for
her leadership. Without their work this would not happen.
Let me tell you what this does. This bill corrects the unintended
consequence of denying liquidity to coastal Americans in their housing
and causing the unintended consequence of people not buying insurance
and putting themselves and this country at greater risk in those areas
that are
[[Page S1629]]
prone to floods. It aggressively addresses the need we have to make
this system more solvent and make it work better.
The Senate today will be solving a greater problem for coastal
American residents and those in flood areas. They will be doing the
right thing at the right time to correct an unintended consequence of
an action of the Congress. I am honored to be a part of it.
I commend Senator Menendez and Senator Landrieu and thank them for
their effort.
I yield back my time.
The PRESIDING OFFICER. The Senator from New York.
Mr. SCHUMER. First, I thank my colleague from Louisiana for letting
me butt in a little bit.
I also praise the three people who are on the floor, one can say
without each of whom this would not have happened. I don't think we can
say that about anyone else here, myself included, but you can say that
about these three. Senator Menendez, our lead sponsor on the bill, who
is indomitable and smart about crafting legislation; Johnny Isakson,
who was able to make this a bipartisan bill and in his gentle,
friendly, and persuasive way brought many people on board, prevented
people from blocking it; and the dynamo--we would all agree--the dynamo
of this operation, Senator Mary Landrieu, who did not quit. I would say
Mary Landrieu and I have had probably 200 phone calls in the last month
about flood insurance--three or four a day. Whenever there was a
blockage, she was like a jackhammer getting through it. So I thank her.
I am going to be very brief as well--not quite as brief as my
colleague from Georgia, but brief for me and brief for the Senate.
This is a very important day for the people of New York. We have
thousands of homeowners who either have had their flood insurance rise
or are fearful of their flood insurance rising. Most of them are
middle-class people in places such as Staten Island, Brooklyn, Queens,
the Rockaways, out to the southern shore of Long Island and up the
Hudson River. To be a homeowner is to have your little piece of the
rock if you are a middle-class person. Basically, it is all you own. To
have that taken away from you by an irrational Washington force called
Biggert-Waters made no sense. Yet, when people's flood insurance bills
would go up from $500 to $4,000, when they were told if they sold their
house it might go up to $10,000, their piece of the rock--their home--
was in true jeopardy.
We all know there is an increase in flooding. We all know the huge
damage Katrina and Sandy caused. But to put it on the backs of
homeowners, as FEMA was doing by both increasing rates and expanding
flood maps beyond what flood zones should be made no sense.
We had so many people in New York who were damaged--I know this is
true of my colleague from New Jersey as well--who were damaged by
Sandy, who painstakingly rebuilt their home, getting some money from
insurance and some money from FEMA and some money from Sandy and going
to relatives and friends. After their home was finally rebuilt to be
told, now here is your $5,000 flood insurance bill, when these people
are in debt, it was awful, a double whammy.
This bill isn't perfect, but it will stop all of that. It
grandfathers homes in so people who sell their homes will not see the
price go way up, and because of the efforts we made in the Senate, the
bill the House is sending us has an individual limit on how much flood
insurance can go up. Eighteen percent is still not as low an amount as
we would like--and we may be able to revisit that down the road--but it
certainly is not a 700-, 2,000- or 5,000-percent increase, which is
what people were getting.
So this is a good day. It is a good day for the shorefront areas of
New York which contain close to 1 million people. It is a good day for
the coastal areas throughout America, the areas by rivers throughout
America. Do you know what it means? It means that the American dream of
working hard, buying a home, and having your little piece of the rock
will not be destroyed by some unknown, misunderstood, and irrational
force from Washington on flood insurance. Flood insurance will now be a
friend once again rather than a foe.
I yield the floor.
The PRESIDING OFFICER. The Senator from Louisiana.
Ms. LANDRIEU. I wish to speak on this for 2 minutes now, because I
know people are anxious to vote on final passage of this important
bill, and I will speak at length after the vote.
I just wish to say thank you to the two leaders who are on the floor,
Senator Menendez from New Jersey, Senator Johnny Isakson from Georgia.
They were the team who brought the coalition together when it was very
hard--and still is difficult--to build a coalition on any subject. This
subject is complicated. It is difficult. There are very strong feelings
on all sides. There are different parts of the country that look at
this in different ways, and there are debts that need to be paid
attached to this program. So this was not an easy negotiation, and the
leaders both did an extraordinary job keeping us on track.
No. 2, this compromise--and that is what it represents--the best of
the compromise was, in fact, debated at length on this Senate floor; it
was debated at length in the House of Representatives; and it was voted
on 67 to 32 in the Senate favorably and 306 to 91 in the House
favorably. The minority view--represented by the Senator from Utah,
which would throw this bill into a conference committee right now--is
not what the American people want, and it is not what the majority of
Republicans or the majority of Democrats want, as demonstrated by the
vote I just put into the Record.
We could all take this bill and rewrite sections of it that would
work better for our home State, but that is not what this place is
about. This place is not about perfection. It is about the art of the
possible, and it is about listening to our constituents and responding
to them when they have a great need.
In the State of Louisiana, I have 400,000 people who are afraid they
will lose their homes. For many of these families, that is the greatest
asset they have, and they are close to losing it. They don't want us to
go to the conference committee and perfect this bill. They want us to
pass it today, right now, and that is what I think we are going to do.
I know the Senator from Utah is disappointed. He may know the masters
of the universe, but I am still looking for them. I could use a lot
more wisdom and strength. If they are around here, I would like them to
present themselves. All we have right now is each other--human beings
trying to do the very best we can with a difficult circumstance. It may
not be a perfect bill, but the concept of this bill got 67 votes in the
Senate and 306 votes in the House. We have passed it in record time,
given the pace around here. I am very proud.
I see the Senator from Florida. I know he would like to say a word.
Mr. NELSON. Will the Senator yield?
Ms. LANDRIEU. Yes.
Mr. NELSON. I thank the Senator from Louisiana, who has been the
sparkplug behind this bill. As a result of her hard work, there are a
lot of people in Florida who will be saved unconscionable increases.
Again, my thanks to the Senator from Louisiana.
Ms. LANDRIEU. I yield and turn the floor over to the leader, Senator
Menendez. I believe the time will be yielded back.
The PRESIDING OFFICER. The Senator from New Jersey.
Mr. MENENDEZ. Mr. President, I understand we are going to be able to
act on the Lee bill with a voice vote. As a result, I ask consent that
the order with respect to a 60-affirmative-vote threshold with respect
to S. 2137 be vitiated with all of the provisions of the previous order
remaining in effect.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. MENENDEZ. Mr. President, in the interest of getting this bill to
the President's desk and giving relief to flood victims across the
country, and many other homeowners, we yield back the remainder of our
time and ask for the yeas and nays.
The PRESIDING OFFICER. Is there a sufficient second?
There appears to be a sufficient second.
Without objection, all time is yielded back.
[[Page S1630]]
The bill was ordered to a third reading and was read the third time.
The PRESIDING OFFICER. The bill having been read the third time, the
question is, Shall it pass?
The yeas and nays have been ordered.
The clerk will call the roll.
Mr. DURBIN. I announce that the Senator from California (Mrs. Boxer)
and the Senator from Missouri (Mrs. McCaskill) are necessarily absent.
Mr. CORNYN. The following Senators are necessarily absent: the
Senator from Nevada (Mr. Heller), the Senator from Oklahoma (Mr.
Inhofe), the Senator from Kansas (Mr. Moran), and the Senator from
Kentucky (Mr. Paul).
The PRESIDING OFFICER (Ms. Heitkamp). Are there any other Senators in
the Chamber desiring to vote?
The result was announced--yeas 72, nays 22, as follows:
[Rollcall Vote No. 78 Leg.]
YEAS--72
Ayotte
Baldwin
Begich
Bennet
Blumenthal
Blunt
Booker
Brown
Burr
Cantwell
Cardin
Casey
Chambliss
Coats
Cochran
Collins
Coons
Cruz
Donnelly
Durbin
Feinstein
Franken
Gillibrand
Graham
Grassley
Hagan
Harkin
Heinrich
Heitkamp
Hirono
Hoeven
Isakson
Kaine
King
Kirk
Klobuchar
Landrieu
Leahy
Levin
Manchin
Markey
Menendez
Merkley
Mikulski
Murkowski
Murphy
Murray
Nelson
Portman
Pryor
Reed
Reid
Rockefeller
Rubio
Sanders
Schatz
Schumer
Scott
Sessions
Shaheen
Stabenow
Tester
Toomey
Udall (CO)
Udall (NM)
Vitter
Walsh
Warner
Warren
Whitehouse
Wicker
Wyden
NAYS--22
Alexander
Barrasso
Boozman
Carper
Coburn
Corker
Cornyn
Crapo
Enzi
Fischer
Flake
Hatch
Johanns
Johnson (SD)
Johnson (WI)
Lee
McCain
McConnell
Risch
Roberts
Shelby
Thune
NOT VOTING--6
Boxer
Heller
Inhofe
McCaskill
Moran
Paul
The bill (H.R. 3370) was passed.
VOTE EXPLANATION
Mrs. BOXER. Madam President, I was unable to attend the roll
call vote on passage of H.R. 3370, the Homeowner Flood Insurance
Affordability Act of 2014. Had I been present for this vote, I would
have voted yea.
Ms. LANDRIEU. Madam President, when Hurricane Betsy roared ashore in
Grand Isle on September 9, 1965, it wrought havoc in Louisiana and
Mississippi and became the first natural disaster to cost American
taxpayers more than $1 billion. It fundamentally changed the way our
nation prepared for and responded to disasters. Private insurers fled
the market, making it necessary for the federal government to step in
and help communities rebuild and recover. The National Flood Insurance
Program established building standards for flood prone areas to limit
communities' exposure to flooding and rewarded responsible homeowners
with affordable flood insurance that was no longer available in the
private market.
In response, Congress, led by Hale Boggs, passed the National Flood
Insurance Act of 1968 with the explicit goal of making ``. . . flood
insurance available on reasonable terms and conditions . . .''
Affordability was one of the primary goals of the National Flood
Insurance Program when it was created, and it remains an essential
priority today. Unfortunately, affordability was virtually eliminated
by the 2012 NFIP reform legislation known as Biggert-Waters, and we had
to fight to get it reinstated in the compromise bill that cleared the
House last Wednesday, March 5 with a strong, bipartisan vote of 306-91.
On January 16, Speaker Boehner flatly refused to consider
comprehensive flood insurance reform legislation in the House, telling
an AP reporter bluntly: ``We're not going to do that.'' The decisive
67-32 Senate vote to pass the Homeowner Flood Insurance Affordability
Act on January 30 demonstrated the breadth and depth of our coalition
and provided the necessary momentum for House leadership to get engaged
and support this strategy.
Senior leaders of both parties worked closely with Rep. Maxine
Waters, Rep. Cedric Richmond, Majority Leader Eric Cantor and Rep.
Michael Grimm to reach a fair, bipartisan, bicamercal compromise that
can get to the President's desk, and we owe it to our constituents to
act as soon as possible with an up or down vote.
The National Flood Insurance Program is one of the earliest examples
of large scale community planning in America. It made community based
mitigation a requirement for rebuilding. In order to be eligible for
federally subsidized, low-cost flood insurance, communities had to pass
ordinances restricting future development in floodplains. Taxpayers for
Common Sense, the National Wildlife Federation and others would have
you believe that NFIP encourages development in flood plains, but the
reality is that it does the exact opposite.
By removing affordability from the core of the National Flood
Insurance Program, Biggert-Waters put every policyholder on the path to
Full Risk Rates whatever they may be. Speaking in support of the
compromise bill, Steve Scalise, my colleague from Louisiana and Chair
of the conservative Republican Study Committee, explained the problem
clearly and directly saying:
``Sending somebody a $10,000 or a $20,000-a-year bill on a $200,000
house that never flooded is not an actuarially sound rate. It's a death
sentence.''
Whether it takes 2 years or 20 years to get there, full risk rates of
$20,000 or more will continue to freeze the housing market, depress
property values, and prevent responsible homeowners from purchasing
flood insurance. Program participation is already anemic with just over
half--60 percent--of those required by law to have flood insurance in
compliance and even less market penetration in low-risk areas where we
want people to purchase voluntary flood insurance policies to grow and
diversify the risk pool. The Senate bill delayed the worst rate
increases until FEMA completed the affordability study and proposed an
affordability framework to protect people from impossibly high
premiums.
This indiscriminate march to Full Risk Rates is further complicated
by a fundamentally flawed mapping process that wipes local levees off
the maps and excludes impacted communities from the mapping process. At
my request last summer, David Miller, Association Administrator for the
Federal Insurance and Mitigation Administration--the man in charge of
the National Flood Insurance Program, stood on top of a $450 million
levee in Lafourche Parish that was completely wiped off the map when
FEMA released their new flood map in 2008. Their map remains under
appeal to this day.
The parish was one of 25 sites nationally included in the pilot
program for FEMA's new Levee Analysis and Mapping Procedures, LAMP,
that were designed to fix this problem, but that process only began
last summer and has a long way to go before it is ready for prime time.
The Senate bill delayed rate increases based on new flood maps until
FEMA certified that their maps were accurate and reliable.
Whereas the Senate sought to delay the worst parts of Biggert-Waters
until maps were accurate and the affordability study was complete, the
House took a different approach by repealing these provisions and
replacing them with other annual fees and rate increases. We had a
healthy discussion and debate about our two approaches and eventually
arrived at a compromise we could all live with that will protect people
from the most aggressive rate hikes included in Biggert-Waters.
I commend Rep. Waters and Rep. Richmond for the leadership in
reinstating affordability as an essential element of this program.
Since Representative Cantor unveiled his bill on February 21, we
successfully amended it to include an 18 percent annual cap on
individual premium increases and an overall affordability target of 1
percent of the value of the policy.
While I would have preferred lower annual premium increases and
stricter standards on overall affordability, this bill is a decent
compromise that will address the most pernicious pieces of Biggert-
Waters and attract the bipartisan support necessary to get it to the
President's desk. This is another important step in our ongoing efforts
to provide affordable, accessible and sustainable flood insurance to
middle class Americans, but this bill is not the
[[Page S1631]]
end of the battle. Nothing is perfect. Nothing is permanent.
After nearly 2 years of arduous work and steadfast determination by a
broad coalition of individuals, business groups and community leaders,
the most pernicious provisions and draconian rate increases of Biggert-
Waters have successfully been stopped and affordability has been
returned as the centerpiece of the National Flood Insurance Program.
The passionate debate we had during the last 2 years--one that will
continue--has shown that affordable flood insurance is about more than
just actuarial numbers on a page. It is about protecting our unique
culture, our treasured way of life, and preserving the historic coastal
communities that built this nation and continue to drive its economy
today.
As Chair of the Department of Homeland Security Appropriations
Committee, I will hold FEMA accountable for implementing this bill in a
timely and transparent manner that provides homeowners and housing
markets with the immediate relief they need to recover from these
draconian rate hikes. Over the course of the past week, we were able to
improve the original Cantor bill by removing onerous and unnecessary
bureaucratic provisions, but I am not confident that FEMA will execute
this either efficiently or effectively.
The great coalition of home builders, realtors, bankers, insurance
agents, mayors, local governments and individual homeowners that fought
to make flood insurance reform a national priority must remain vigilant
and engaged. The National Flood Insurance Program expires in 2017, and
we will need to include strict affordability language to protect
responsible homeowners from impossible premiums.
The compromise bill that passed the House last week with a vote of
306-91 has the support of the coalition that helped secure the strong
67-32 vote in the Senate earlier this year. Some of the key industry
groups behind the bill are:
Greater New Orleans Inc--GNO Inc,
National Association of Realtors,
National Home Builders Association,
National Association of Counties--NACo,
National League of Cities,
American Bankers Association,
Independent Community Bankers of America, and the
Independent Insurance Agents and Brokers of America--Big
``I''.
Biggert-Waters was built backwards and upside down. It authorized
immediate rate increases on responsible homeowners without any
understanding of how they would impact individual policyholders or the
program at large and before FEMA was able to certify that their maps
are accurate and reliable.
Lafourche Parish has been appealing their new map since 2008 because
FEMA cannot figure out how to give them credit for local levees,
including an 8-16 foot, 40 mile ring levee that was authorized by
Congress in 1965--the Larose to Golden Meadow Hurricane Protection
Project. To date, $450 million has been invested in this project,
including $200 million from the Federal government. This past summer,
FEMA began a pilot program that is supposed to solve the problem, but
it will be another 2-3 years before that process is complete. FEMA
needs to get their flood maps right the first time.
Currently, only 60 percent of the homeowners and businesses that are
REQUIRED to have flood insurance actually do, and the aggressive rate
increases authorized under Biggert-Waters threaten to make that problem
a whole lot worse. The Congressional Budget Office estimates that every
10 percent increase in premiums leads to a 3 percent drop in overall
program participation.
Katherine in Houma, LA cannot sell her home because a pernicious
provision in Biggert-Waters that immediately increases premiums
hundreds or thousands of dollars when you sell your house. When the
young couple that was trying to buy her house went to closing, they
learned that the flood insurance would go from $1,400 to $8,000 and
could no longer afford the house. Katherine is stuck with a house she
cannot sell and insurance she cannot afford.
Biggert-Waters threatens the very foundation of home ownership, the
cornerstone of the American Dream. Fixing this flawed legislation is
about protecting people's homes and equity and preserving the American
dream that if you work hard and play by the rules you can have a secure
future.
Our bill structures NFIP in an affordable, comprehensive and
sustainable way. For decades, the program was sustainable until the
2005 storm season resulted in an unprecedented $17 billion in claims.
Prior to that, it had an annual average deficit of just $19 million per
year.
This is not just a Louisiana or coastal issue. Fifty-five percent of
our nation's population lives within 50 miles of the coast--and that
doesn't include those living along inland waterways. Ten percent of the
homes in the United States have a one-in-four chance of flooding in the
lifetime of their mortgage.
In 2010, the 15 percent of U.S. counties that are located directly on
open ocean, the Great Lakes, major estuaries or coastal flood plains
contributed $8.3 trillion--55 percent--to the Nation's Gross Domestic
Product, and these communities proved more resilient during the 2007
recession, actually growing employment by 1.4 percent while the
national employment rate fell by 2.3 percent.
This is not about millionaires in mansions on the beach. This is
about middle class Americans who need affordable flood insurance so
they can live where they need to work to harvest fresh seafood, produce
domestic energy, and manufacture and transport the goods we need to
maintain America's competitive advantage in the 21st century.
In response to all the concern I have heard from my constituents, I
launched ``My Home, My Story'' to show you, literally, show some of the
people and properties facing these rate increases that we are aiming to
help. These aren't mansions, these aren't millionaires. These are
middle class, working people living in normal, middle class houses
doing their best to raise their kids, contribute to their communities
and make a living.
I received over a hundred pictures and stories from my constituents.
Cody put his home on the market for less than its value and still
couldn't sell it because of the high premium on his flood insurance.
Rachel lives in a 1,000 square foot elevated home with no central air
or heat, one small bathroom, a quaint front porch and a beautiful
sycamore tree. Three months after moving in, her flood insurance
increased by $750 per year, and she's is struggling to make payments.
Maggie is a 66-year-old woman who has lived in the same house since
1974 and plans to stay there for the remainder of her life. She lives
on a very strict budget and just received her first Social Security
payment. If the law is not changed, it will be impossible for her to
stay in her home or sell her home.
It provides basic consumer protections to responsible homeowners who
built to code and played by the rules are struggling to stay in the
NFIP.
It protects home equity. In St. Charles Parish, LA, the Assessor is
reducing home values up to 30 percent because of the dramatic rate
hikes that take effect overnight when a person goes to sell their home.
Based on the average mortgage, every $1,000 increase in annual flood
insurance premiums reduces an individual's purchasing power by $20,000.
This provision affects 20 percent of all NFIP policyholders--1.1
million properties nationwide.
It ensures FEMA Flood Maps are Accurate. In 2011, FEMA acknowledged
the failings of its ``without levees'' policy that resulted in local
levees being literally wiped off the map, but it took them over two
years to develop a new policy--the Levee Analysis and Mapping
Procedures, LAMP. A pilot program for 25 sites nationwide--including 5
in Louisiana--Lafourche, Terrebonne, St. Charles, Plaquemines and St.
Tammany--began in July, but it will be another 2-3 years before that
process will be complete.
It allows FEMA to Complete the Affordability Study. FEMA must
complete the affordability study mandated by Biggert-Waters and propose
solutions for Congressional review. Our bill creates an expedited
process for Congress to take action on these recommendations while
maintaining critical checks and balances on FEMA's authority.
[[Page S1632]]
Provides Fair Credit for Local Levees--Removes the penalty on
locally-financed flood protection projects and ensures that local and
state investments in mitigation are accurately factored into the flood
mapping process.
I thank the following Senate cosponsors for all their hard work
throughout this process:
Robert Menendez, Johnny Isakson, Mary L. Landrieu, Thad Cochran, Jeff
Merkley, David Vitter, John Hoeven, Tim Scott, Roger Wicker, Heidi
Heitkamp, Chuck Schumer, Kirsten Gillibrand, Ed Markey, Bill Nelson,
Mark Begich, Elizabeth Warren, Al Franken, Joe Manchin, Robert Casey,
Amy Klobuchar, Cory Booker, Kay Hagan, Lindsey Graham, Brian Schatz,
Richard Blumenthal, Jack Reed, Sheldon Whitehouse, Lisa Murkowski, Ron
Wyden, Susan Collins and Debbie Stabenow.
This bill does not incentivize unsustainable development--In order to
participate in the National Flood Insurance Program, communities have
to adopt national building codes governing new development in flood
prone areas. Our bill provides basic consumer protections to homeowners
that build to code and played by the rules. It does not alter or amend
any rules governing new construction. The National Flood Insurance
Program is one of the earliest examples of federal land use planning.
It does not put American Taxpayers on the hook for a small sub-set of
NFIP policyholders. Prior to Hurricanes Katrina and Sandy, NFIP was
basically self-sustaining with an average annual deficit under $20
million over that 26-year span. The $24 billion debt incurred as a
result of 2005 and 2008 storm seasons was the driving force behind the
rate reforms in Biggert-Waters which required NFIP policyholders, not
American taxpayers, to pay down that debt and establish a reserve fund
for future catastrophic events. Our bill does not change that, it
merely gives responsible policyholders a little more time to adjust to
the higher premiums they have to pay as a result of Biggert-Waters.
FEMA Administrator Craig Fugate estimates that the NFIP saves
taxpayers $1.6 billion every year in avoided flood losses and disaster
response costs due to the national building codes each participating
community and policyholder were required to adopt and adhere to.
I would also like to thank the following staff members for their hard
work throughout this process: Jason Tuber, Kirby Mayo, Karissa Willhite
and Tim Del Monico in Senator Menendez' office; Zack Rosenblum and
Meghan Tiara in Senator Schumer's office; Joan Kirchner in Senator
Isakson's office; Adam Telle in Senator Cochran's office; Travis
Johnson in Senator Vitter's office; Claire O'Rourke, Liz Craddock, Matt
Lehner and Wes Kungel in my office; Lisa Lederberger in Maxine Waters'
office; Zach Butterworth in Cedric Richmond's office; Dill Dauster and
Alex McDunah in Senator Reid's office and all of the exceptional floor
staff. On behalf of myself, the Senate cosponsors, and the entire flood
insurance reform coalition, thank you.
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