NU Online News Service, Jan. 26, 3:05 p.m. EST
Efforts are under way to jump-start Senate action on a long-term National Flood Insurance Program extension.
National Flood Services, a Montana firm that serves as a third-party administrator for insurance companies participating in the Write-Your-Own program, is leading the initiative.
Stephen Harty, NFS president and CEO, was in Washington Wednesday as part of his effort to ensure that Congress passes legislation extending the NFIP until Sept. 30, 2016, before the current extension of the existing NFIP runs out May 31.
In a letter sent to the Senate leadership, Harty, says, “In our view, and that of much of the insurance and housing industries, this is a case where a ‘good’ bill enacted now is more beneficial to all parties, including the taxpayer, than a ‘great’ bill that never sees the light of day.”
Harty met with one senator and the staff of three others, seeking to win support of the Senate leadership for prompt action on the Senate bill: the Flood Insurance Reform and Modernization Act of 2011. He also sent a letter to Sen. Harry Reid, D-Nev., Senate majority leader, and Sen. Mitch McConnell, R-Ken.
Harty met Wednesday with the staffs of Reid and McConnell, as well as with the staffs of Sen. Tim Johnson, D-S.D., and Sen. Richard Shelby, R-Ala., chairman and ranking minority member of the Senate Banking Committee, as well as with the staff of Sen. David Vitter, R-La., who is working to ensure that the long-term reauthorization gets through Congress this year.
He also met with Sen. John Tester, D-Mont.
“Failure to enact legislation providing a five-year reauthorization of the program is inimical to the interests of Congress, the Treasury and the more than five million homeowners and businesses across the country who depend on this program,” Harty says in the letter to the Reid and McConnell.
He adds, “What we are hearing from the industry perspective is that uncertainty over the federal government’s commitment to NFIP—as evidenced by Congress’s inability to reauthorize the program—is a major negative factor in terms of private sector participation.”
Harty cites “compelling arguments for decisive action,” citing an Oct. 13, 2011 report by the Congressional Budget Office on the Senate bill, which says, “The changes made by the bill would improve the financial condition of the program and reduce its need to borrow from the Treasury—a source of direct spending—by a total of $380 million between 2012 and 2014….”
Industry lobbyists said last month that there is overwhelming support from members of the Senate for the bill. They say the holdup is that while both Reid and McConnell want to use NFIP reauthorization as a vehicle for pushing through Congress unrelated provisions both want, each opposes the provisions the other wants to include.
The NFIP was last extended until May 31 on Dec. 23, when President Obama signed legislation sent to him by Congress Dec. 16.
According to data collected by State Farm, the latest extension means that, since 2002, there have been 15 last-minute reauthorizations of the NFIP, and on four occasions the program was allowed to lapse for extended periods of time.
According to officials at the Property Casualty Insurers Association of America, in 2010, the NFIP lapsed four times and flood coverage could not be purchased or renewed for a total of 53 days.