Jindal enters flood insurance fray

Gov. Bobby Jindal wrote a letter to congressional leaders asking them to support a legislative amendment that would delay increases in flood insurance rates for Louisiana property owners.

Jindal largely has stayed out of the flood insurance fray between the congressmen who demand that the flood insurance program pay for itself and lawmakers who counter that the 2012 changes to the National Flood Insurance Program would cause rates to rise dramatically for some property owners.

Jindal, in a letter released Wednesday, urged congressional Democratic and Republican leaders to support legislation that would delay implementing the parts of the Biggert-Waters Flood Insurance Reform Act of 2012 that would lead to higher rates and make efforts “to fundamentally restructure” the NFIP.

The U.S. Senate on Jan. 30 approved a delay of the new premium structure that Biggert-Waters created. But the Republican majority in the U.S. House has blocked three votes on the issue over the past six weeks, complaining that the Senate version undercut too much of the financial revamp sought in Biggert-Waters.

Earlier this week, House leaders indicated a vote could happen by next week that would delay the more dramatic rate increases long enough for federal officials to study how to handle the impact that recently updated flood maps had on premium prices.

Earlier this month, the Federal Emergency Management Agency announced that it would not implement the procedures for charging higher rates until October 2015, at least, and possibly for another six to eight months after that.

“The delay is not going to help me,” said Richard Charleville, whose flood insurance increased from $1,140 annually to $16,000 a year. “You can delay it for five years, but I’m sitting on a time bomb. I’ll never be able to sell this house.”

Charleville lives in a $160,000 house in the Country Roads subdivision off Frenchtown Road in Central. He’s near Beaver Bayou and about a mile from the Comite River. The house has no history of flooding and hasn’t flooded during the nine years he has lived there.

Charleville was refinancing his mortgage when his banker demanded a new flood insurance policy. Charleville learned then that he was paying rates that had been subsidized and that new rates had been calculated using new flood maps that would go into effect when his house is sold or refinanced.

“I been hearing rate hike, rate hike, but I thought it was going up like $2,000 or something,” Charleville said. “They have to re-evaluate this. This is their system. They created it. They required me to do it and now they’re giving me a 2,000 percent increase.”

Some congressmen say the flood insurance program needs to become financially sustainable. NFIP has been running a deficit of about $24 billion, largely started by paying claims from policyholders whose property was flooded during hurricanes Katrina and Rita.

Coastal lawmakers from around the country counter that the 2012 changes to make flood insurance more fiscally sound have led to rates so high that few property owners could afford to pay.

Louisiana has nearly 500,000 flood insurance policies, and there are more than 5.5 million policyholders nationwide.

Jindal in his letter criticized the Biggert-Waters Act, saying its goals were laudable but “the ‘reforms’ to the program perpetuate an inefficient bureaucracy, shift government liabilities to homeowners …” He suggested Congress adopt his administration’s proactive plan of building levees and floodwalls, plus adding more acres to Louisiana’s coast wetlands.

The letter was Jindal’s first public and direct intervention in the flood insurance debate on Washington’s Capitol Hill.

Parish government officials and business-oriented policy associations have argued before Congress that changes in the flood insurance program should also strive to keep property owners from being abruptly saddled with such high rate increases.

Louisiana’s congressional delegation has been pushing for delay as have representatives and senators from other coastal states. For instance, New Jersey Gov. Chris Christie spoke out against the revamp last year.