Motion to Discharge

Floor Speech

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Mr. CASSIDY. Mr. President, today is Thursday, October 7, 2021, and Risk Rating 2.0 has officially been in effect for 6 full days.

What is Risk Rating 2.0?

It is a new rating system for the National Flood Insurance Program that will increase premiums higher than sustainable for homeowners and, therefore, higher than is sustainable for the program.

In Louisiana, 80 percent of policyholders will see increases in the first year, and at times, for some, premiums will become unaffordable and can collapse the value of their home. The Presiding Officer is also from a coastal State. This will absolutely affect everyone who lives in a coastal State.

Now, particularly, in my State, in light of recent storms, it is important that we understand the sustainability of the National Flood Insurance Program is key.

Congress never passed a bill requiring that FEMA implement Risk Rating 2.0. President Biden can stop it. He has chosen not to. We have asked that FEMA delay implementing this program or reconsider it altogether.

Now, by the way, FEMA has been slow to share information with policyholders and, frankly, misleading Congress by hiding the true consequences of 2.0 and not being up front with the cost in the out- years. They said they would tell policyholders by August 1 of the increase in premiums, but they missed the deadline. It didn't come down to homeowners and insurers until the middle of September. Some are still trying to figure out what this rating system will mean for their life.

In 2019, my office reached out to the administration, and we were able to successfully delay the implementation saying that there needed to be further consideration. This time, however, the Biden administration has chosen not to delay it.

Now, let's just take a quote from a working family in Lake Charles, LA, who does not--I repeat--does not live in a flood zone. They currently pay $572 for flood insurance on a single-family home that is worth approximately $250,000. The quote he received--this is real life. This isn't theoretical. The quote that he received under Risk Rating 2.0 raises his premium to over $5,000--$572 to $5,000.

Now, rate increases are capped at 18 percent annually, so it doesn't happen next year. But this is 18 percent compounded. It is kind of like a balloon on one of those little helium things. It starts off and it doesn't seem that it is inflating, and then, all of a sudden, it inflates rapidly, like a balloon note on a mortgage.

So with progressive increases, when it gets to $5,000--actually, $5,624--he will have to choose: Do I continue my policy?

Now, he is not in a flood zone. If you think about actuarially, you want people who are not at high risk to spread the cost for everybody else.

Under this, the Congressional Budget Office estimates that 20 percent of policyholders will drop their insurance. That has a risk of putting the National Flood Insurance Program into an actuarial death spiral where those at lower risk drop the insurance, the remaining risk is forced upon a relatively small number of people raising their risk even more, and you gradually have a continual falloff of the number of people in the program.

Now, some policyholders are required to pay for the insurance by law, but this puts them in an even worse situation. They will either have to put thousands of dollars up for their insurance or risk losing their home.

I would ask President Biden, who unquestionably is an empathetic man and empathetic to the working families of our country, to consider delaying Risk Rating 2.0.

Now, there are a couple of criticisms of the flood insurance program, in general, which are unfounded.

First: These are millionaires' vacation homes; why do we even have a program?

This is factually not true. When CBO looked at samples of home values in the program, it ranged from $220- to $400,000. And I imagine the President from New Jersey--President of the Senate from New Jersey--can think of a middle-income family, a police officer and a teacher; who now live in a home worth $400,000. These are not millionaires or billionaires.

In my home State of Louisiana, these are middle-income and working families, folks trying to make ends meet. They are not folks in a vacation home. And here is an example of homes, after recent Hurricane Ida, that would need flood insurance: middle-income homes.

By the way, you can see these homes are built a little bit on a berm. They have actually taken the effort to protect their homes from flooding. So the home itself is not flooded, just everything else around it. On the other hand, I can promise you that there are older neighborhoods in which the water is above the doorstep.

Now, looking specifically at Risk Rating 2.0, data shows who will see the rate hikes. It is bad news for Louisiana, where rates will increase for almost everybody.

The second criticism of the program is that it subsidizes people who suffer repetitive flood damage. Now, this argument is mitigated, if you will, by offering mitigation. Data shows that mitigation is good for the taxpayer. According to the National Institute of Building Sciences, for every $1 spent in Federal mitigation grants, it saves the program an average of $6.

In the Infrastructure Investment and Jobs Act, there is $3.5 billion in flood mitigation assistance grants--grants going towards buying up properties that have experienced repetitive loss. Shoring up the program by removing high-risk properties protects other properties. It is true in your State, and it is true in my State. It is a wise investment to protect the National Flood Insurance Program.

So we can have a conversation, by the way, about a criticism that if mitigation opportunities are offered to homeowners and they decline them, what to do about that. On the other hand, when folks are offered mitigation, they almost always accept the opportunity for that.

Finally, some argue that private insurers will replace the National Flood Insurance Program. But let's be honest, that will not occur. I support the expansion of private insurance covering flood properties. Consumers should have options. If nothing else, this highlights the need for a long-term fix to the program.

In the past, I proposed reforms to ensure that NFIP is affordable and accessible to homeowners, accountable to taxpayers, and sustainable. I worked on flood insurance programs with Senators Menendez and Gillibrand, both of them coming from States affected by flooding, just as mine did as well. This makes it bipartisan, two different regions. It is not only about the Gulf Coast; it is about the Atlantic Coast, the Pacific Coast; and it is about our island properties.

By the way, I have been speaking about Louisiana, but Risk Rating 2.0 applies nationwide. It impacts all those living on our coasts. Once more, we should all--all of us representing States with coastlines--ask the Biden administration to halt Risk Rating 2.0.

This Congress, I will continue to work to reform NFIP. In addition to affordability, accessibility, accountability, and sustainability, there needs to be an emphasis on supporting prevention and mitigation efforts to prevent future floods.

At the end of the day, flood insurance must be affordable for the homeowner, accessible, accountable to the taxpayer, and sustainable for the future. Tribute to Pastor A.R. Harris, Sr.

Mr. President, I would like to take a moment to honor a man in my State of Louisiana, who has dedicated nearly 80 percent of his life to preaching the gospel and serving others through his faith.

Pastor A.R. Harris, Sr., was born December 16, 1932, in Jonesboro, LA. He has preached the Gospel of Jesus Christ since he was 7 years old and led God's people for over six decades.

Pastor Harris is a veteran who served our country in the United States Army during the Korean war. He and his wife Eva of 63 years have six wonderful children, four of whom followed their father's footsteps to preach the Good Word to spread the Gospel. He and Eva are being honored for their 46 years of service at their church, Zion Hill Missionary Baptist Church #2.

He is a man of God, family, and country; and it is my privilege to stand here on the floor of the U.S. Senate and recognize the faithful service of Pastor A.R. Harris, Sr.

God bless him, his family, and God bless the United States of America.

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