[Congressional Record Volume 170, Number 94 (Monday, June 3, 2024)]
[Senate]
[Pages S3924-S3925]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]



                    National Flood Insurance Program

  Mr. CASSIDY. Madam President, hurricane season started on June 1; and 
although we, of course, feel that particularly in Louisiana, I will 
note that last year, a hurricane hit Southern California. So this is 
something which can happen all over our Nation, and people in Louisiana 
know what people in California have learned: When there is a hurricane, 
there can be flooding. Now, we--I say ``we'' as we in Louisiana but, 
hopefully, people all over--know how to prepare; but this year, 
unfortunately, fewer people in Louisiana and fewer people nationwide 
will be able to count on the National Flood Insurance Program to help 
them in case they do flood.
  The National Flood Insurance Program, or the NFIP, was created as a 
safety net for the most vulnerable Americans. The stereotype is that 
this is only for rich people who build properties on coastal islands 
which are bound to flood. The reality is these are working families. 
These are folks who have no place else to move. These are folks who 
have spent decades in communities that have never flooded; yet, 
nonetheless, they are left without the protection of the National Flood 
Insurance Program. The NFIP covers 4.7 million American homes, but 
because of the new FEMA risk assessment system, called Risk Rating 2.0, 
there has been an unprecedented spike in insurance premiums, making 
them unaffordable and causing people to drop their coverage.
  I speak to constituents constantly about flood insurance. I just want 
to, if I can, channel my constituents onto the floor of the U.S. Senate 
and, perhaps, through C-SPAN and, perhaps, through the Congressional 
Record speak to the Nation through folks who feel as if they are not 
being heard.
  I recently heard from a constituent in Larose, LA, who switched from 
the NFIP to a private insurance carrier because he could not afford his 
national flood insurance plan. Now, the private insurance plan isn't 
cheap--it is $2,200 a year--but he would have paid NFIP somewhere 
between $4,500 and $5,000 a

[[Page S3925]]

year, and that was 2 years ago. I note that the private plan is 
cheaper, although it is not cheap, which suggests that maybe the 
National Flood Insurance Program has things built into it that aren't 
required to be there.
  By the way, his house is 6 feet above sea level, but the NFIP ignores 
that. The way the National Flood Insurance Program rates a home is not 
by how much you have elevated it above sea level but by the zone in 
which you live. So if you are surrounded by homes on slabs but you are 
elevated, you get rated just the same as they. According to his 
neighbors, the last time this area flooded was with Hurricane Juan in 
1985, but his property did not flood.
  Now, this story isn't unique or uncommon. Families across Louisiana 
and across the country are experiencing the same situation. You will 
love the names in Louisiana, but here is another one.
  One retired couple living on Bayou Lafourche--meaning ``the fork''--
near Raceland, LA, dropped their National Flood Insurance policy 
because premiums rose from $500 to $2,500 annually. Some people might 
say: Oh, my gosh; $2,500 is just not a lot of money. For a family 
living in Bayou Lafourche, $2,500 is more than they can afford. Now, 
the premium increases are capped at 18 percent a year, but 18 percent 
compounded upon 18 percent compounded upon 18 percent quickly adds up.
  Their son lives just down the road from them, and his flood insurance 
is going from $500 to $6,300. Obviously, this is not sustainable for 
your typical homeowner.
  By the way, if you buy a new policy, then you are subject to the new 
rates right away--meaning, for example, you would be charged $6,300 off 
the bat, and you wouldn't start off with the lower amount and work your 
way up.
  This brings us to a family in Lockport, LA. They just bought a new 
home and chose not to have flood insurance because the premium would 
have been too unaffordable. Now, they had the option that other 
homeowners don't have. Most mortgages in Louisiana require home buyers 
to get flood insurance. So if you take a mortgage, you have got to buy 
it.
  This leads us to a business owner. He invested $1.2 million in a 
brandnew office building and warehouse in the town of Cut Off, LA. They 
are behind a levee system that has never failed, and they elevated the 
office 7 feet off the ground. He tells me that if he had taken a 
mortgage, he would have had to pay tens of thousands of dollars of 
combined insurance between the flood insurance and the property 
insurance, and it would have been more than his actual mortgage. He 
says: My gosh. Why would any business locate here if they could build 
somewhere else cheaper and with less red tape?
  This tells us that not only is Risk Rating 2.0 charging pretty 
exorbitant rates for people who have never flooded, but it is stifling 
communities; it is eliminating economic growth; it is making people who 
live there move and keeping people who would like to live there from 
moving to there.
  There is a man in Boutte, LA, who told my office his premium will 
increase to over $8,000 a year over the next 13 years. His flood 
insurance before Risk Rating 2.0 was $570. At the current rate, he will 
be paying more for flood insurance than his mortgage in 2 years.
  I have said this before on the Senate floor and will say it again: 
Someone who has never flooded should never be paying more for their 
flood insurance than they are for their mortgage.
  There is a constituent in Montegut, LA, who might lose his home 
altogether because he can't afford to keep it. He is a Korean war 
veteran. He and his wife are both in their eighties, and they took out 
a reverse mortgage on their house several years ago to help pay medical 
bills. They live behind a 12-foot levee, but their reverse mortgage 
requires them to carry flood insurance. That now costs them $6,500 a 
year; and that is on top of what he is paying for his homeowners 
insurance. If their flood insurance continues to rise, they will give 
up their home. And that is not right.
  Now I speak to my fellow legislators.
  We are elected to serve. If we are failing to address the issue of 
the National Flood Insurance Program and folks like this Korean war 
veteran and his wife, who are in their eighties, are driven out of 
their home because FEMA has decided they are going to develop a new 
system to assess, but that system has flaws and we don't address it, we 
are not doing our job. By this, by channeling these voices, I am asking 
that we in this body work to address these very human needs of fellow 
Americans.
  Now, some of these stories are more dramatic than others, but they 
all have a common theme: They didn't flood, but they can't afford their 
insurance. Well, if you can't afford insurance and you don't flood 
anyway, then you are quite likely to drop your insurance. That is too 
bad because what that is going to do to the National Flood Insurance 
Program is create what is called an actuarial death spiral. If the low-
risk people who don't flood are paying such high premiums that they 
drop their coverage, then all the remaining risk is put upon the 
remaining policyholders, which means they pay more, and there are going 
to be some of those who will drop out because they can't afford it. It 
will continue to concentrate the cost of the risk upon a smaller and 
smaller group of people until, ultimately, no one can afford this.
  We are setting the program up--or at least FEMA is setting up the 
program--for collapse. FEMA itself forecasted that over 20 percent of 
policyholders will leave the program within 10 years.
  Now is the time for Congress to act. But I want to be clear: This is 
not just a Louisiana or a gulf coast issue. I opened up by speaking 
about a hurricane hitting Southern California. This is an issue that 
affects the entire country. We are seeing, just by cost, the areas that 
are dark are those that have had over $1 billion in claims--so the mid-
Atlantic States, the Northeast, including New York, Pennsylvania, and 
New Jersey, and if you go across the gulf coast, including Texas, 
Missouri, and all the way out to California. Now, if you went over $50 
million, then those are also these other tan States. This is a 
nationwide issue.
  I am pleased to say we have a bipartisan solution. I urge my 
colleagues to come talk to me about the National Flood Insurance 
Program reauthorization and reform. These bipartisan Northeast-gulf 
coast, Democratic-Republican, liberal-conservative kind of perspectives 
that have been included in this have come up with a solution. This 
would make Risk Rating 2.0 transparent; it would make it affordable; 
and it would make it accountable.
  We need a way forward, because if these stories just make one thing 
clear, it is that doing nothing is not an option. It is that doing 
nothing is a disservice to fellow Americans.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Alabama.
  Mrs. BRITT. Madam President, I ask unanimous consent to speak for up 
to 5 minutes prior to the scheduled rollcall vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.