Flood Insurance Reform Act of 2011

Floor Speech

Ms. WATERS. Mr. Chairman, I oppose the gentleman's amendment.

In drafting this bill, the chairwoman and I sought to strike the right balance between protecting homeowners and strengthening the flood insurance program. I believe that the bill before us today does just that.

Unfortunately, I do not believe that the gentleman's amendment strikes the same balance. Specifically, by creating a reserve fund, the gentleman's amendment would allow the NFIP to increase insurance premiums on homeowners.

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Ms. WATERS. Mr. Chairman, I oppose the gentlewoman's amendment.

The gentlewoman's amendment would prohibit FEMA from spending any funds on television or radio commercials to promote the purchase of flood insurance.

Floods are the most common natural disaster in the United States. Unfortunately, even areas that aren't in floodplains experience floods sometimes. When that happens, the Federal Government provides aid to those homeowners and communities, and it is the taxpayer who pays for that aid.

Under the National Flood Insurance Program, insurance premiums pay for the cost of flood damage. Therefore, if homeowners outside floodplains buy flood insurance, taxpayers won't be on the hook if their properties flood. However, in order to have these homeowners buy flood insurance, they have to learn about the program and its benefits to them. This is where radio and television advertising are helpful--essential, that is. The ads reach a wide audience and present clear facts about the availability and affordability of flood insurance.

To take away FEMA's ability to let the people know what's available to them would actually place the millions of Americans who choose and are not required to purchase flood insurance at risk. Given these times of record deficits, this is simply irresponsible. That is why I urge a "no'' vote on this amendment.

Mr. Chairman, I reserve the balance of my time.
So regardless of their flood risk, homeowners will have to pay more in order to fund a reserve fund that will never have enough money to pay out claims for catastrophic events. This isn't fair to our taxpayers, Mr. Chairman, and, in fact, would stall the already slow recovery of the housing market.

I understand the problem that the gentleman is attempting to solve. We all know that the flood insurance program is over $17 billion in debt due to claims resulting from Hurricane Katrina.

However, I think we have to be clear that Hurricane Katrina was a catastrophic, once in a lifetime event. Prior to Katrina, the flood insurance program operated completely in the black.

In addition, I believe that the bill contains many provisions that would allow the flood insurance program to reform its premium structure so that it can collect the premiums it needs to pay out claims. For example, the bill ends subsidies for 350,000 pre-FIRM properties, including second homes, commercial properties, homes with new owners, homes substantially damaged or improved, and homes with repetitive claims.

By making these properties pay actuarial rates that reflect their full risk, the bill would make these properties pay their fair share, thereby increasing the amount of funding to the flood insurance fund.

Mr. Chairman, while I believe that the gentleman's amendment is very well intended, I believe that it is unnecessary given the strong reforms in this bill and the potential problems it may cause for homeowners, particularly those that have been phased into actuarial rates.

For these reasons, Mr. Chairman, I must oppose the amendment and I would urge a ``no'' vote.

I yield back the balance of my time.

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Ms. WATERS. Mr. Chairman, as I mentioned earlier, when the gentlelady offered her views during the general discussion, she certainly does not join with her colleagues who have joined with us in a bipartisan way to produce a bill that is in the best interests of all of the citizens of this country. As a matter of fact, I have referred to her views on this issue as rather radical. I think that for us to have an insurance program that allows participation by the average citizen so that they can be in a position to make themselves whole after a disaster, to basically repair their homes, to replace their furnishings, and to basically have a way of continuing a decent quality of life is not too much to ask of your government.

So I would oppose this amendment and consider this amendment also just as radical. To say that you have a program but you can't tell anybody about it simply does not make good sense.

I yield back the balance of my time.

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Ms. WATERS. Mr. Chairman, I strongly oppose this amendment.

The gentlewoman's amendment would terminate entirely the flood insurance program, which provides much needed insurance for 5.5 million homeowners. The flood insurance program was created in 1968 after record flooding led the private insurance industry to stop writing flood policies. The private sector didn't want to write these policies because floods are very common and very expensive. However, the Federal Government didn't want to simply write a blank check for homeowners every time it flooded. This is why the flood insurance program was created.

Mr. Chairman, I yield the balance of my time to the gentlewoman from Illinois, Chairwoman Biggert, who has worked so hard on this legislation.

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