U.S. Senate to take up flood insurance rate increase

The fight to delay flood insurance rate hikes for thousands of Louisianians is moving to the U.S. Senate this month.

But members of the state’s congressional delegation on Tuesday urged the government to make administrative fixes to the National Flood Insurance Program.

Five of the Louisiana members of the House joined more than 20 other Republican and Democratic representatives in sending a letter to FEMA Administrator Craig Fugate to make as many administrative fixes as possible to avoid skyrocketing rate hikes.

The Federal Emergency Management Agency oversees the flood insurance program.

Reps. Bill Cassidy, R-Baton Rouge; Cedric Richmond, D-New Orleans; Steve Scalise, R-Jefferson; Charles Boustany, R-Lafayette; and Rodney Alexander, R-Quitman, were the Louisiana members who signed the letter.

“A small percentage of homeowners are learning that they may be subjected to flood insurance rates that are ten, a hundred, and in some cases, more than a thousand times higher than their current subsidized rates,” the letter states.

“These rates, which are upwards of $28,000 per year, are unaffordable and could have devastating impacts on these homeowners and their communities if they are implemented.”

FEMA is still in the process of finalizing its flood mapping, so details are still up in the air as the new law moves toward taking effect starting in October.

Nearly 500,000 people in Louisiana participate in the NFIP. The program has been in financial distress with a loss of more than $20 billion, largely due to payments made after hurricanes Katrina and Rita in 2005.

The fear is that proposed flood maps will cost Louisiana residents and business owners a lot more in the congressional effort to make the flood insurance program more self-sustainable.

The proposed flood maps are still under federal review but more parts of the state’s coast are becoming high-risk velocity zones, or V-zones, where insurance rates increase more.

The program also starts phasing out “grandfathered” rates, which are the subsidized rates on properties built before the NFIP started in 1968.

Last month, the U.S. House passed an amendment to delay the impact on grandfathered properties for one year. The change was sponsored by Cassidy and Richmond.

“As a result of FEMA’s flawed mapping methodology, many Louisianans are facing substantial flood insurance rate spikes,” Cassidy said Tuesday in a prepared statement.

A similar effort — a longer, three-year delay — sponsored in the Senate by Louisiana’s Sens. Mary Landrieu, a Democrat, and David Vitter, a Republican, failed last month when it was blocked by Sen. Pat Toomey, R-Pa.

But Landrieu chairs the Senate Appropriations Homeland Security Subcommittee, and she plans to insert the House amendment and its one-year delay into the Homeland Security appropriations bill that will begin being marked up in committee as soon as later this month.

“Hopefully, we can garner enough bipartisan support to ensure its passage in Committee, through the Senate, and to the President’s desk for his signature,” Landrieu wrote to 13 south Louisiana parish presidents.

“In addition, I will continue to work with you to secure a long-term, more comprehensive solution to this problem.”

The 2012 NFIP legislation “makes the program self-sustainable, but on the backs of homeowners living and working along the coast,” Landrieu said.

Landrieu announced last month that FEMA Associate Administrator David Miller, who oversees the NFIP, would participate this summer in a tour of Louisiana communities impacted by the flood insurance rate increases.

But she said FEMA can only do so much and that a legislative fix is required.

While a legislative fix is needed, critics have argued that FEMA is not properly accounting for flood-protection structures.

As a result, even home and business owners who have never experienced serious flooding are facing major rate hikes.

Landrieu previously filed the SMART NFIP Act — Strengthen, Modernize and Reform The National Flood Insurance Program Act — that would indefinitely delay the hikes until six months after Congress receives an affordability study by FEMA.

The bill also protects properties that are currently “grandfathered.”

Vitter has filed a bill with Sen. Thad Cochran, R-Miss., called the Responsible Implementation of Flood Insurance Reform Act that would delay the period of phasing in rates, give flexibility for state and local governments to assist with subsidizing flood insurance and “reform” FEMA’s flood-mapping procedures.

In the House, Richmond, Cassidy, Scalise, Boustany, Alexander and a few out-of-state members have sponsored the Flood Insurance Implementation Reform Act, which would delay for five years rate hikes from going into effect after properties are sold and stall for three years rates hikes going into effect as properties have their “grandfathered” statuses phased out.

The bill also would require FEMA to identify non-structural flood mitigation on its flood maps, such as forests and marshlands.