Providing for Consideration of H.R. 1309, Flood Insurance Reform Act of 2011

Floor Speech

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Mr. SESSIONS. Mr. Speaker, for the purpose of debate only, I yield the customary 30 minutes to my colleague and friend, the gentleman from Massachusetts (Mr. McGovern), pending which I yield myself such time as I may consume. During consideration of this resolution, all time yielded is for the purpose of debate only.

GENERAL LEAVE

Mr. SESSIONS. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks.

The SPEAKER pro tempore. Is there objection to the request of the gentleman from Texas?

There was no objection.

Mr. SESSIONS. House Resolution 340 provides for a structured rule designated by the Rules Committee for consideration of H.R. 1309. This rule allows for 25 amendments submitted to the Rules Committee by Democrats and Republicans to be made in order.

I rise today in support of this rule, Mr. Speaker. This legislation was introduced by the chairwoman of the Subcommittee on Insurance, Housing and Community Opportunity, the gentlewoman from Illinois (Mrs. Biggert), and this bill has gone through regular order. There were hearings on this issue. H.R. 1309 was marked up in the Financial Services Committee and reported out by a unanimous vote of 54-0, and the chairman of the Rules Committee, the gentleman from California (Mr. Dreier), provided a structured amendment process with 25 additional amendments to be considered on the House floor.

Said another way, Mr. Speaker, the Rules Committee, under the leadership of David Dreier, is willing to have in our upstairs committee room Members of Congress come and testify with the understanding that, in their confidence in the process of this House of Representatives, that they can bring forth their amendments, be heard by a Rules Committee that can equally give the Republican and Democrat sides the ideas that those Members wish to bring before this body, and that is what is happening with 25 amendments being made in order by the gentleman from California with the Rules Committee.

Today, I will discuss the background of the current National Flood Insurance Program or NFIP, and why a long-term reauthorization is important, what the underlying legislation does to the NFIP, and why reforms are necessary.

The NFIP was created in 1968 to address the Nation's flood exposure and the need to alleviate taxpayers' responsibility for flood losses paid out in the form of post-disaster relief following annual flooding that occurs across this country. In 1973, the Flood Disaster Protection Act established a mandatory flood insurance purchase requirement for structures located in identified special flood hazard areas. By 1984, Congress required lenders to purchase coverage on behalf of--and to bill premiums to--mortgagees who failed to purchase coverage on their own.

The 2005 hurricane season resulted in significant claims which the NFIP annual contributions could not cover, so the NFIP's borrowing authority, which was at $1.5 billion a year, was increased three times from 2005, 2006 and 2007, allowing the NFIP to borrow up to $20.8 billion. Currently, the NFIP owes the national Treasury $17.75 billion. A recent Insurance Journal article from March 8, 2011, discusses this plan and it stated: "The proposal does attempt to put the program on sounder financial footing by insisting that current subsidized prices to most policies be raised so they eventually cover the actual cost of risk determined by the actuaries.'' The underlying bill allows for greater accountability so taxpayers, meaning the Federal Government, actually incur less risk than in the current NFIP. Limiting the exposures for the taxpayer is one piece of what this bill does.

The legislation we are discussing today reauthorizes the NFIP for 5 years through September 30, 2016. The current program is scheduled to expire on September 30 of this year. The last time Congress passed a long-term flood insurance program was in 2004. Since its expiration in 2008, the NFIP has been extended 11 times and lapsed three times during that period. These short-term extensions and lapses create needless uncertainty in the marketplace in an already struggling residential and commercial real estate market all across the United States. Charles Symington with the Independent Insurance Agents and Brokers of America was quoted in a recent industry Insurance Journal stating: "The 5-year extension of NFIP after several years of short-term lapses and last minute renewals is critical because it gives the marketplace certainty.''

Mr. Speaker, I believe Charles is correct. The Congress of the United States must do its job by looking at those programs, looking at their need to make sure that they work properly and to make sure that the exposure to the taxpayer is not overextended. Charles Symington has this correct.

In addition to providing a much needed long-term authorization, this bill amends the NFIP to ensure the immediate and near-term fiscal and administrative health of the program. The bill also ensures the NFIP's continued viability by encouraging broader participation in this program, increasing financial accountability, eliminating unnecessary rate subsidies, and updating the program to the needs that currently face this great Nation.

Since 2006, the NFIP has been cited by the Government Accountability Office, GAO, as a high-risk government program. This means that embedded within this program, it is not being run to the best benefit of not just its mission statement, but also the best interest of the taxpayer. The GAO has found that the NFIP does not charge sufficiently high rates to cover its claims obligations and projected future losses, resulting in significant Federal expenditures and potentially large future liabilities on top of the $17.75 billion that the program is already in debt.

To protect the American taxpayers from future risk of a Federal program already in debt, the NFIP must be reformed. That's why we are here today. The underlying bill provides for some of the necessary reforms, and certainly we don't have to debate this, but with a $14 trillion deficit and out-of-control wasteful Washington government spending, Congress must provide the necessary oversight and accountability to ensure less taxpayer risk. I encourage my colleagues to vote "yes'' on this rule.

I reserve the balance of my time.

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Mr. SESSIONS. I want to thank the gentleman from Massachusetts not only for his service to the Rules Committee but also for the ideas that he represents. And I'm delighted that he had an opportunity today to state with
great clarity that the 25 amendments that have been made in order by the Rules Committee are good for this institution, this body, and lives up to the promise not just that our Speaker, the gentleman, John Boehner, and our Majority Leader, Eric Cantor, subscribe to, but also the chairman of the Rules Committee, the gentleman, David Dreier.

Mr. Speaker, the bill we are discussing today provides a long-term certainty in the flood insurance market. It allows for greater transparency and accountability in the flood insurance program and removes or diminishes greatly the great risk that taxpayers incur from bailing out the current program.

This country is facing a $14 trillion debt with almost $18 billion of that coming from the NFIP. Congress sorely needed to retain its control over this program and to ensure that we relooked at it in its reauthorization. However, we still have a government that spends way too much, taxes too much, listens too little to the needs of the American people. And today, the Republican Party, through the leadership that we're being provided by Mrs. Biggert from Illinois, is doing exactly that one at a time, to take on the programs and needs of this great Nation.

Once again, this bill provides us much needed long-term reauthorization and amends the NFIP to ensure the immediate and near-term fiscal administrative health of this program. The bill also ensures the NFIP's continued viability by encouraging broader participation in the program, increasing financial accountability, eliminating unnecessary rate subsidies, and updating the program to meet the current needs of this great Nation.

I applaud my colleagues for introducing the bill, the gentlewoman, Mrs. Biggert, for her hard work, the hundreds of meetings that were involved taking feedback from Members of Congress, looking at their needs, and then addressing those.

I encourage a "yes'' vote on this rule.

I yield back the balance of my time, and I move the previous question on the resolution.

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