The Senate approved legislation on Thursday to delay flood insurance rate hikes for thousands of homes and businesses around the country.
The upper chamber voted 72-22 to scale back reforms to the federal flood insurance program that were made just two years ago.
The bill, which was passed by the House earlier this month, now heads to President Obama's desk for his signature before becoming law.
Earlier this year, the Senate passed legislation that would have delayed the reforms until a study on affordability was conducted, but senators said the House fix was even better.
“The legislation is budget neutral,” Sen. Robert Menendez (D-N.J.) said Thursday. “And it prevents skyrocketing rate increases.”
The 2012 reforms were originally made to pull the National Flood Insurance Program out of billions of dollars in debt stemming from Hurricane Katrina and Hurricane Sandy. But lawmakers from coastal states quickly realized the rate increases would harm their constituents.
To avoid having taxpayers fill this hole, the 2012 legislation called for insurance rate hikes aimed at more closely aligning the premiums collected to payments going out. Changes included matching premiums to flood risks, ending lower rates for homes with “grandfathered” status and eliminating insurance subsidies for homes once they were sold to a new owner.
But last year, new flood insurance rates were announced that were much higher than anticipated. Those changes led to complaints that owning a home or business in a flood zone was about to become unaffordable.
The new bill repeals many of the 2012 law's changes and replaces them with a more moderate program for increasing insurance premiums.
It requires rates to rise an average of 5 percent per year for all flood-risk categories, but caps that at 15 percent.
Sen. Mike Lee (R-Utah) opposed the legislation because he wasn’t able to offer amendments.
“This particular bill has not been examined in committee,” Lee said. “It’s been rushed to the floor here without amendments. This is not how the legislative process is suppose to work.”
He agreed to let the legislation advance if he got a vote on his amendment as a stand-alone measure. His bill, S. 2137, passed by a voice-vote and heads to the House for further action. Lee said that his bill would prevent taxpayer for subsidizing families’ vacation homes.