By Ramsey Cox
With the help of several Republicans, Senate Democrats defeated a budget point of order against a bill that delays flood insurance rate increases.
Sen. Tom Coburn (R-Okla.) raised the budget point of order, but Democrats moved to waive the motion on a 64-35 vote Wednesday.
That vote came as the Senate considered several amendments to S. 1926, the Homeowner Flood Insurance Affordability Act, introduced by Sen. Bob Menendez (D-N.J.). Earlier this week, the Senate voted 86-13 to consideration the legisaltion.
The bill delays a required increase in flood insurance premiums for some homes, and would allow homeowners to maintain existing flood insurance subsidies even after they are sold. Supporters of the bill say these changes are needed while the government studies whether homeowners can afford these higher costs.
“What’s insurance about? Insurance is about spreading risk over a wider pool,” Menendez said. “People who just can’t simply meet that skyrocketing premium and in essence have to say they can’t have insurance. … What happens then? The pool grows smaller … and the price of insurance goes up even higher.”
Some Republicans complained that the bill violated the budget agreement because it wasn’t paid for. The point of flood insurance reform was to ensure the program regained solvency. After Hurricane Katrina, the National Flood Insurance Program (NFIP) began operating at a $18 billion loss.
“The program is basically bankrupt and is only operating based on the grace of the American taxpayer,” Sen. Richard Shelby (R-Ala.) said. “The program was not designed to be actuarially sound. … Biggert-Waters made it sound.”
In 2012, Congress passed flood insurance reforms, called Biggert-Waters, to ensure the bankrupt program regained stability, but some lawmakers have complained that the law was ill conceived because the new rates are too high for some people to stay in their homes.
“The goal is to make the system whole and fiscally sustainable,” Sen. David Vitter (R-La.) said ahead of the vote. “Not people leaving [the program] and turning in their keys.”
S. 1926 would delay language that would immediately eliminate flood insurance subsidies for homes built before 1975 upon the sale of those homes. The bill would delay this trigger until the Federal Emergency Management Agency (FEMA) does an affordability study. FEMA would also have to certify that its flood maps are accurate — a process that FEMA has said could take three years.
The bill would also grandfather low rates for people who are put into a flood zone for the first time, or are put into a higher-risk flood zone. Biggert-Waters required these people to pay the higher rate, which would be phased in over five years.
The Senate then adopted three more amendments to the bill by voice-vote. Descriptions of those amendments follow:
- Sen. Jack Reed’s (D-R.I.) amendment to require the administrator of FEMA to conduct a study to assess voluntary community-based flood insurance options.
- Sen. Sheldon Whitehouse’s (D-R.I.) amendment to exempt natural resource agencies working to restore rivers and renovate dams from a nearly $5,000 fee for flood insurance rate map change requests.
- Sen. Kirsten Gillibrand’s amendment to require FEMA to issue guidelines for methods, other than building elevation, that owners of certain urban residential buildings may implement to mitigate flood risk.
More amendment votes are expected Thursday, followed by final passage around 2 p.m.