NU Online News Service, Feb. 21, 12:40 p.m. EST

Legislation that would provide subsidized premiums under the National Flood Insurance Program for farmers whose properties are at-risk due to aging and substandard levee structures is being criticized by experts at the Heartland Institute, a think tank.

The legislation was recently introduced by Rep. John Garamendi, D-Calif.

Under the bill, the Flood Insurance for Farmers Act, H.R. 4020, coverage of agricultural structures in floodplains where levee systems recently have been downgraded by the Federal Emergency Management Agency (FEMA) would be charged rates that reflect only "a low or moderate risk of flooding."

The bill also would prohibit FEMA from requiring flood-proofing or flood damage mitigation for new or existing agricultural structures in such zones.

According to Garamendi, a former insurance commissioner, the bill addresses a serious problem for farmers who produce crops and raise livestock in floodplains. He said that, "As the FEMA continues its studies of the levee systems that protect agricultural land, many of the levees have been downgraded."

He added that, until the levees are improved, farmers in many places are unable to build new or upgrade existing agricultural structures necessary to conduct or increase production and business.

But R.J. Lehmann, deputy director, of Heartland's Center on Finance, Insurance, and Real Estate in Washington, said the bill "does no favor for farmers by encouraging them to continue to live, work, and build on properties at risk of catastrophic flooding."

He also said it eliminates an incentive for local communities to repair and upgrade levee systems found to be substandard, and that it would likely add to the NFIP's more than $18 billion in debt because it would be forced to subsidize risks that are both foreseeable and avoidable.

"The U.S. House of Representatives already has recognized the problems that subsidized federal flood insurance pose by passing overwhelmingly legislation that would phase out existing subsidies for second homes, commercial properties, and properties subject to repetitive losses," Lehmann said.

The House bill is H.R. 1309, the "Flood Insurance Reform Act of 2011." It was passed by a large margin by the full House last July.

"It is particularly disappointing that Rep. Garamendi, a former insurance commissioner of the nation's largest state, would abandon the principles of sound risk management with a proposal to introduce new destructive subsidies to the NFIP, which has been targeted by the Government Accountability Office as a high-risk federal program," Lehmann said.

Companion legislation is also awaiting Senate action. Last week, 41 senators asked the Senate leadership to act promptly on the bill.

The NFIP has been functioning under temporary reauthorizations since Sept. 2008.

The current temporary reauthorization runs out May 31.

Special Reports /

Bill for Flood-Risky Farmers Could Add to NFIP Debt: Heartland

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