Bill to delay flood insurance clears first committee hearing

WASHINGTON — Legislation to delay by one year dramatic increases in flood insurance premiums for many south Louisiana properties moved forward in the Senate on Tuesday.

The legislation cleared Sen. Mary Landrieu’s Senate Appropriations Homeland Security Subcommittee and was sent to the full Senate Appropriations Committee.

The issue began with the reauthorization last year of the National Flood Insurance Program, which includes rate hikes of up to 25 percent a year on non-primary residences, businesses and homes that have flooded multiple times.

Primary residences currently receiving subsidized “grandfathered” rates are not affected until the home is sold or the policy lapses.

“Grandfathered” properties were built before the NFIP started in 1968 and also applies to properties that have seen their flood risks increase over the years.

Parish presidents in south Louisiana, however, contend that the law makes thousands of “grandfathered” homes unsellable and that FEMA is underestimating the impact of the change.

The Federal Emergency Management Agency, which is part of the Department of Homeland Security and oversees the NFIP, counters that more than 400,000 of Louisiana’s nearly 500,000 flood insurance policies would not be affected because their flood insurance rates are already appropriately set. 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 one-year delay in the U.S. Senate bill resembles a measure approved last month in the House that was successfully tacked onto the Homeland Security funding bill on the House floor by U.S. Reps. Bill Cassidy, R-Baton Rouge; Cedric Richmond, D-New Orleans; and others.

Landrieu, D-La., had pushed a stronger three-year delay. But she said Tuesday that she did not want to “risk losing an opportunity for a one-year” delay. She said a lot of senators from non-coastal states still support the legislation passed last year to make the flood insurance program more financially self-sustainable.

“We have to have this Homeland Security (bill) passed by the full committee and then through conference onto the president’s desk for signature,” Landrieu said. “So there’s a long way to go, and we can’t go on that way without coming to an agreement on the budget.”

The legislation passed out of the subcommittee Tuesday also includes about $10 million more than the president’s proposed budget for modernizing flood maps to help ensure they fully reflect local investments in flood protection infrastructure.

FEMA also was repeatedly criticized for not counting flood-protection measures other than federally authorized 100-year flood protection levees and floodwalls in the past.

But FEMA is now implementing a pilot program with five parishes — St. Charles, St. Tammany, Terrebonne, Lafourche and Plaquemines — to determine new guidelines for factoring in non-accredited levee systems.

The Louisiana congressional delegation also has criticized FEMA for recently issuing preliminary flood maps for Orleans, Jefferson and St. Bernard parishes.

FEMA Associate Administrator David Miller, who oversees the NFIP, confirmed Tuesday that he will visit southern Louisiana to tour the affected areas with Landrieu and others.

Cassidy said in a prepared statement Tuesday that he is glad the Senate is moving forward with passing the “Cassidy amendment” on which he was the lead sponsor.

“This is a good first step but I encourage Senate leadership to move swiftly and pass these provisions before the full U.S. Senate,” Cassidy stated.

Cassidy is challenging Landrieu for re-election to her U.S. Senate seat.

After Landrieu’s office announced Tuesday that Miller would visit on Aug. 8, Cassidy’s office noted that the Baton Rouge congressman and other House members first wrote a letter on June 4 asking Miller to come to Louisiana.

It was on June 4 that Landrieu first announced Miller had agreed to visit during the summer.

GNO Inc. President and CEO Michael Hecht in a prepared statement praised the progress made Tuesday to fix mistakes made in last year’s NFIP reauthorization, called the Biggert-Waters Act.

“This is an important step forward in reversing the draconian flood insurance premium increases which are the result of the confluence of the Biggert-Waters Act of 2012 (which was meant to stabilize NFIP), incomplete and inaccurate FEMA maps, and questionable actuarial calculations,” Hecht stated.