Flood Insurance Reform Priorities Act of 2010
Floor Speech
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Ms. WATERS. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, I am proud to bring my bill, H.R. 5114, the Flood Insurance Reform Priorities Act of 2010, to the floor today; and I stand in strong support of its passage. Moreover, I'm proud that this bill has the support of my colleagues on both sides of the aisle, having passed out of the Financial Services Committee in April on voice vote.
Mr. Chairman, this bill is essential. The Flood Insurance Program provides valuable protection for approximately 5.5 million homeowners; but, unfortunately, the lack of a long-term authorization has placed the program at risk. The program has lapsed three times now since the beginning of this year: for 2 days in March, for 18 days in April, and again from June 1 to July 2, when President Obama signed my bill to provide for a short-term extension of the program through the end of September of this year.
These lapses meant that FEMA was not able to write new policies, renew expiring policies, or increase coverage limits. These delays also meant that each day 1,200 home buyers who wanted to purchase homes located in flood plains were unable to close on their homes. Given the current crisis in the housing market, this instability in the Flood Insurance Program is hampering that market's recovery and must be addressed.
Mr. Chairman, in drafting this bill, I also wanted to address the challenges posed to communities by the imposition of new flood maps. I saw these challenges firsthand in my home city of Los Angeles. Earlier this year I was able to assist homeowners in the Park Mesa Heights area of Los Angeles who had been mistakenly placed in a flood plain. In this case, FEMA acted quickly to respond to new data and correct the mistake. However, there are thousands of homeowners nationwide who now find themselves in flood zones and subject to mandatory purchase requirements.
H.R. 5114, the Flood Insurance Reform Priorities Act of 2010, would restore stability to the Flood Insurance Program by reauthorizing the program for 5 years. It would also address the impact of new flood maps by delaying the mandatory purchase requirement for 5 years and then phasing in actuarial rates for another 5 years.
The bill also makes other improvements to the program by phasing in actuarial rates from pre-firm properties, raising maximum coverage limits, providing notice to renters about contents insurance, and establishing a flood insurance advocate similar to the taxpayer advocate at the Internal Revenue Service.
Mr. Chairman, we must reauthorize the National Flood Insurance Program and pass the reforms included in H.R. 5114. This country is reeling from major floods in Tennessee, Arkansas, and Oklahoma; and we are now officially in hurricane season, with south Texas still recovering from Hurricane Alex. I urge my colleagues to stand with me in support of this important extension.
In closing, I would like to recognize the many Members on both sides of the aisle who have approached me with their concerns about flood insurance programs. I'm further gratified that, through this bill, we're able to address many of those concerns. I remain committed to working with Members on ensuring that this program works for their communities and their constituents.
I reserve the balance of my time.
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Ms. WATERS. Mr. Chairman, I yield myself 30 seconds to make sure that the gen tle lady understands that we are moderating the subsidy in several ways on second homes, on nonresidential property, and when the homes are sold, and that's an important point that we will have some discussion on later.
At this time I yield 1 minute to the gentleman from Georgia (Mr. Scott), who's been responsible for making sure that we give homeowners an opportunity to pay installments instead of up front all of these premiums that they will be responsible for.
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Ms. WATERS. Mr. Chairman, I would like to thank the ranking member from West Virginia (Mrs. Capito) for her cooperation and the work that she has put into the formulation of this very, very important bill.
I would like to thank Members on both sides of the aisle for the cooperation that we have seen exhibited on this bill, and I think that the Members on both sides of the aisle have done a fabulous job representing their constituencies on this issue.
It is time for us to have a reauthorization for 5 years, given the lapses that we have had and the risks that we have placed homeowners at when we don't have flood insurance coverage. And so Members have come one by one on this issue explaining what is going on in their districts, and of course, we have had a lot of criticism about FEMA. We have had Members explain that neighbors are getting together to fight some of the mapping that is being done. All of that has been brought to our attention, and we've been able to deal with most of those complaints, not only in this bill but, of course, in the manager's amendment.
We have some people who are going to bring amendments to the floor from both sides of the aisle, and I'm confident that with the work that has gone into this bill, the amendments that we will have on the floor--many of them will be adopted--that we will see a good, solid piece of legislation move from this floor that will address the concerns of so many of our constituents across this country.
I'm proud of this legislation. I thank not only the Members on both sides of the aisle but the staffs from both sides of the aisle who have worked so hard to ensure that we address these concerns.
So, now, with this authorization for 5 years, with the delayed time so that people have the opportunity to prepare, with the installment, with the way that we have done all of this, including putting an advocate in, our constituents are going to get some justice, some real attention; and I think they will be proud of the work that we have done.
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Ms. WATERS. Mr. Chairman, I yield myself such time as I may consume.
Mr. Chairman, the manager's amendment I have submitted to the committee would make further improvements on the bill. The amendment would contribute to the stability of the flood insurance program by prospectively phasing in actuarial rates for severe repetitive loss properties and properties sustaining substantial damage.
The financial solvency of the program would also be protected by a provision that would make sure that homeowners receiving preferred rates who deliberately drop out of the program are charged actuarial rates if they rejoin the program.
The amendment also strengthens protections for homeowners by allowing all homeowners to pay flood insurance premiums in installments, providing grants to homeowners experiencing repeated flooding with funds to mitigate their flood risk, requiring FEMA to take a second look at areas that may be incorrectly mapped, and requiring FEMA to study the impacts of the flood insurance program on working waterfronts.
I am pleased that this amendment also incorporates amendments offered by many Members, including Mr. Hinchey, Mr. Clyburn, Ms. Herseth Sandlin, Mr. Hare, Ms. Markey, Mrs. McCarthy, Mr. Melancon, and Mr. Pascrell. I thank these Members and others who have made suggestions to me for their constructive additions to this amendment.
This amendment makes significant improvements to the underlying legislation, and I urge an ``aye'' vote on the amendment.
Mr. Chairman I reserve the balance of my tim
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Ms. WATERS. I think everything has been said that needs to be said.
I simply again want to thank all of the Members that have been involved. I am very pleased that we finally are responding to the concerns of all of our constituents, particularly about new mapping. There are a lot of concerns about that. But the way that we delay implementation will give our constituents an opportunity to prepare the installment plans, the way we deal with the actuarial rates. I think this is some of the best work that could have been done to honor the concerns of our constituents.
I yield back the balance of my time.
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Ms. WATERS. Mr. Chairman, I would like to thank the gentleman from Florida for offering this amendment.
The underlying bill authorizes grants to local communities to reach out to homeowners and communities about the flood insurance program and flood risk. As we know, the process by which homeowners receive notification of new flood maps is severely lacking.
Too often, homeowners learn that they are in a floodplain when they receive a letter from their mortgage company informing them that they have 45 days to buy flood insurance or it will be purchased on their behalf. Local communities are supposed to inform residents about new maps. However, communities often receive little notification from FEMA themselves. Also, some communities simply lack the resources to do the type of notification that is necessary to ensure that homeowners are aware of changes to the flood maps.
By providing a grant program to assist communities, the underlying bill would address this problem. The gentleman's amendment would require the director of the flood insurance program to submit annual reports to the Congress on the effectiveness of these grants. I think that is important. And I think that Congress should know how these grants are working and how these funds are being spent.
So I support the gentleman's amendment, and I would urge an ``aye'' vote.
I yield back the balance of my time.
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Ms. WATERS. Mr. Chairman, quite simply, I support the gentleman's amendment. While I believe that the bill is clear that the grants provided under the bill would be competitive and, therefore, not subject to earmarking, I can understand the gentleman's need for wanting to clarify that these funds cannot be used for earmarks. Therefore, I support the amendment, and I would urge an ``aye'' vote.
I yield back the balance of my time.
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Ms. WATERS. Mr. Chairman, I stand in support of this gentleman's amendment.
In April, my subcommittee held a hearing on flood and wind insurance legislative proposals. And at that hearing, the gentleman from Mississippi testified about the way the insurance industry abused the flood insurance program following Hurricane Katrina by claiming that if so much as a drop of water touched a home, that all the resulting damage was the result of flood and not wind, even if there was damage to the contrary. Insurers were able to maintain their bottom line at the expense of the financial solvency of the National Flood Insurance Program.
Nobody has worked harder on these issues than he has. He deserves support for this amendment, and we will continue to support his instructions about what we should be doing in the future.
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Ms. WATERS. Mr. Chairman, I support the gentlewoman's amendment. I understand that the gentlewoman has some concerns with the flood insurance program. I understand that she does believe that homeowners in her district are subsidizing the cost of flood insurance for homeowners along the coast.
While I disagree with her premise, I see no harm in having the GAO perform the study described in her amendment to look into the role of the private insurance market in providing flood insurance, the impact on the program if communities drop out, and the feasibility of regionalizing the program.
However, I would like to note that flood insurance is just that, insurance. It insures against an event that may or may not happen in the future. We have taken several steps in this bill to address the ``sticker shock'' that homeowners are encountering as a result of the mandatory purchase requirement resulting from the new maps.
However, if the maps are accurate, and if there is a flood risk, public policy should dictate that homeowners have coverage for that risk because if they don't, the Federal Government will have to pick up the tab.
Therefore, I disagree with the problem the gentlewoman has with the program. But I see no harm in her amendment, and so I would support that amendment.
I yield back the balance of my time.
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Ms. WATERS. Mr. Speaker and Members, we patiently waited over here to hear what this motion to recommit was going to be all about. We thought about all of the Members who have been calling us, writing us, working with us from both sides of the aisle to please help them address the concerns of their constituents about flood insurance. We have worked very hard with Members from both sides of the aisle to include their concerns in this bill.
You saw Members come to the floor with those amendments. You saw in the manager's amendment that we had worked with so many Members not only to include their concerns, but to answer questions and prepare them for going back to their communities explaining how this whole thing works.
Many of those questions that have been raised by our constituents have been raised over a long period of time. Our offices are bombarded with questions about the mapping. How does it work? How are they going to get timely notification? What are the premiums all about? These questions go on and on and on, to the point where our offices are oftentimes overwhelmed, not able to give sufficient information, or to assist those communities where they have banded together, despite the fact oftentimes they have few resources to deal with these issues.
And now, in this comprehensive authorization that we are doing we address those constituents' concerns with this outreach. I am very surprised that the Members on the opposite side of the aisle would try and deny to their constituents the basic kind of information and services that we should all be responsible for. We should be able to say to our constituents not only do you have a right to this information, but we are going to give you some help. You don't have to try and band together with resources that you don't have to find out how it all works to oppose FEMA, to find out from your mortgage servicers why you didn't get a timely notice, to find out from your city, who was notified perhaps by FEMA, why they didn't notify the community.
Mr. Speaker and Members, these are simply outreach activities that must be dealt with. These are outreach activities that our constituents deserve. To oppose assisting our constituents when they may be forced into new mapping that's going to cost them money that they had not anticipated, on and on and on, is just unbelievable.
So I would simply say it speaks for itself. Assistance to our constituents asking those basic questions. I would ask for a ``no'' vote on this motion to recommit. It works against the best interests of all of our constituents. They deserve better than this.
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