Rep. Nugent Introduces Bipartisan Legislation Delaying Flawed Flood Insurance Rate Hike

(WASHINGTON, DC) – Following introduction of his legislation to delay the disastrous flood insurance rate hikes from taking effect, Rep. Rich Nugent (FL-11) issued the following statement:


“In July, 2011 Congress overwhelmingly passed a long-term reauthorization of the National Flood Insurance Program.   Having passed a long string of short term, stopgap reauthorizations, Congress finally reached an agreement to institute reforms to the program that would make it sustainable and that led to a long-term agreement on whether to continue having a National Flood Insurance Program at all.

“At the time, the bill passed in the House with over 400 votes.  The National Association of Realtors called its passage a ‘major victory’ for homeowners.  The Independent Community Bankers and others hailed the victory.  Congress and realtors all over the country breathed a sigh of relief.  Fast forward two-plus years and we now have homeowners across the country who are looking at flood insurance premiums that are going to skyrocket – some going from $900 to $15,000 or more.  The original author of the bill, Rep. Maxine Waters joined with many of us, including the realtors, in desperately seeking a delay in implementation of the new rates.   This, in short, is not what Congress intended.

“A crucial part of the reforms was an affordability study that was supposed to be completed prior to the new rates kicking in.  That study still hasn’t come back and the Administrator of FEMA has testified that it may not be ready until 2015.  That is unacceptable to the residents of our state and there is no reason these new rates should be going into effect.  Today, I am introducing bipartisan legislation that will delay the new rates until the study is complete.  The legislation will also require that if the study finds that the new rates are not affordable, then FEMA must make recommendations about what changes Congress should make.  Congress would then be required to vote up-or-down on those recommended changes within ten legislative days.  If either chamber rejects the changes, then the new rates will be delayed for 180 days after the report is released to provide Congress with time to come up with a workable solution.

“It is extremely difficult to craft policy that attracts unanimous support in the House and it’s even more difficult to get that policy through the Senate and signed into law.  The fact that the original author of the bill is now calling for a delay in her own legislation shows just how important this delay is.

“Last week, Rep. Bill Cassidy and I met with the congressional Flood Insurance Task Force which is comprised of a number of private sector experts including John Rollins who is formerly with Citizens in Florida, David Walker, the former Comptroller General of the United States, and Belinda Hoffman Miller from the Florida Office of Insurance Regulation.  We heard from representatives in the insurance and reinsurance community, the bond community, and banks who have been working on private sector solutions to the flood insurance issue.  The bottom line is that while private sector solutions may be an option, they are still a long way off.  For the time being, the NFIP is the only option available for homeowners and the rate increases are hitting our communities right now.  FEMA still isn’t done redrawing their maps.  There are huge concerns about the maps they do have.  Policyholders don’t have good recourse to fight the maps if they disagree.  Mitigation initiatives aren’t available for many.  It is absolutely critical that Congress pauses on this long enough to get it right.  Our communities will be hit hard.  And even though the vast majority of congressional districts may not have flood prone areas, I think everybody can understand why this country doesn’t need another major hit to the housing market.

“Finding a responsible way forward is critical and this legislation will provide us with an opportunity to find that way forward.

“I am grateful to Congresswoman Castor for agreeing to be the Democrat lead on this bill.  To all of our colleagues whose constituents are facing these rate increases, this is not a partisan issue.  This is Congress working together to try and right a basic wrong.  We’re going to continue meeting with experts, working with the realtors, and reaching out to our colleagues in other states.  All of us want to see this fixed and we’re going to keep pushing until it is.”

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