WASHINGTON — Senate Majority Leader Harry Reid, D-Nev., is arranging for the Senate to vote on delaying flood insurance premium increases for many policyholders in Louisiana and nationwide as soon as the first week Congress comes back from the Christmas recess on Jan. 6.
Sens. Mary Landrieu, D-La.; Bill Nelson, D-Fla.; and Chuck Schumer, D-N.Y., all took turns Thursday thanking Reid and touting the need to quickly pass the Homeowner Flood Insurance Affordability Act in order to avoid further harm to people’s lives and the real estate market.
“We better wake up and realize the economic impact this is going to have on the entire country if this is not fixed,” Landrieu said. “This is not about millionaires on a beach.
“This is about the middle class and working hard where you need to live to work,” Landrieu said, citing the seafood, energy and shipping industries.
All 50 states are impacted by the flood insurance rates hikes, she said, because every state has existing or proposed flood maps.
Nelson cited the example of one Tampa, Fla. resident who is facing annual flood insurance premiums jumping from $4,000 a year to $44,000. “It is not only ridiculous, it is stunning,” he said.
Reid is planning to fast track the legislation for a January vote that would require 60 votes and Landrieu said there will be enough support to pass it.
The National Flood Insurance Program has been in financial distress with a loss of nearly $25 billion, largely due to payments made after hurricanes Katrina and Rita in 2005. Louisiana has nearly 500,000 NFIP policies, and there are more than 5.5 million policyholders nationwide.
Congress last year passed legislation to make the program more self-sustainable in a large omnibus bill, but the flood insurance rate hikes are much more expensive and onerous than many lawmakers anticipated.
The Homeowner Flood Insurance Affordability Act would delay by about four years the insurance hikes on primary residences — excluding properties that suffered repeated flooding — that have received “grandfathered” lower premiums. The legislation also would delay the property sale “trigger” so that homes and businesses sold after July 6, 2012, do not see dramatic automatic insurance increases.
The legislation does not address rate hikes though for businesses, secondary vacation homes and homes that repeatedly flooded that were all grandfathered into artificially lower premiums for flood insurance before flood maps were created. Such affected policyholders will see 25 percent annual premium increases over a few years.
The lead sponsors of the legislation are Sens. Robert Menendez, D-N.J., and Johnny Isakson, R-Ga. But Landrieu and Sen. David Vitter, R-La., are counted among nearly 30 co-sponsors.
The same bill in the House has nearly 170 cosponsors, but the legislation has not yet moved. One of the key roadblocks is the opposition of Rep. Jeb Hensarling, R-Texas, who chairs the House Financial Services Committee through which the bill would likely travel.
In a funding bill, the House has passed a one-year delay of the flood insurance hikes — an amendment by Rep. Bill Cassidy, R-Baton Rouge — but the lack of a budget deal until this week had stalled the progression of all such appropriations bills.