NU Online News Service, Feb. 8, 3:10 p.m. EST
WASHINGTON—Legislation has been introduced in Congress that would phase out the National Flood Insurance Program by the end of 2013.
The legislation, H.R. 435, was introduced by Rep. Candice Miller, R-Mich.
The bill would also immediately end all remapping of the program mandated by prior reauthorizations of the program, thereby ending the agency’s authority to charge more to current customers based on new maps mandated by the 2003 law that remains in effect.
Earlier this month, Rep. Miller had asked colleagues to support the measure.
That Congress may take a long look at the program was also acknowledged earlier this week by Rep. Scott Garrett, R-N.J., chairman of the Capital Markets Subcommittee of the House Financial Services Committee, which has prime jurisdiction over the program.
During an appearance at a housing conference Monday, Rep. Garrett said, “The government's history in pricing risk is extremely poor,” citing the Federal Deposit Insurance Corporation, the National Flood Insurance Program, and the Pension Benefit Guaranty Corp. as three entities with “terrible records of properly pricing for risk.”
The current program expires Sept. 30, the end of the current fiscal year. The program has been extended five times, with several lapses, since the original reauthorization of the current program ended Sept. 30, 2008.
Charles Symington, senior vice president of government affairs for the Independent Insurance Agents and Brokers of America (IIABA), said that extension of the NFIP will be a top priority of the association this year.
“Much like the past two years, we don’t expect getting the program reauthorized will be easy,” Mr. Symington said. “However, the program is absolutely essential to ensure that consumers obtain the coverage for flood loss that they need,” he added.
He acknowledged that “it has been tough the last two years to get extensions, and you can put on top of that the focus on reducing the federal government, on budget-cutting; it just makes the job more difficult.”
But, he said, “We think we can get it done. We think we have a persuasive case to make. But, it won’t be an easy lift.”
He said that while the IIABA would like to see additional reforms to the program, the top priority is getting the program extended. “But, it will take an effort on behalf of agents, Realtors, mortgage bankers, banks, etc.” Mr. Symington added.