NU Online News Service, June 20 1:25 p.m. EDT
The Senate appears set for action this week on its long-term National Flood Insurance Program extension bill after two compromises were reached on key issues.
One compromise involves the purchase of flood insurance for properties protected by levees. Sen. Mark Pryor, D-Ark., wanted to eliminate the section of the bill requiring that such properties be covered by flood insurance.
The Senate Banking Committee leadership instead reached a compromise with Sen. Thad Cochran, R-Miss., calling for the coverage requirement to remain, but acknowledging the reduced risk of flood through lower premiums.
According to Matt Gannon, assistant vice president of federal affairs for the National Association of Mutual Insurance Companies, the compromise “recognizes that flood control structures are not infallible and ensures that all areas at risk of flooding will be treated equally, while also ensuring investments in flood control structures are accurately reflected in flood insurance rates.”
The compromise also calls for a study of the impact of including residual risk in the flood-insurance program, and a study to determine the feasibility of offering group-flood-insurance policies, Gannon says.
At the same time, a spokesman for Sen. Roger Wicker, R-Miss., says the Senate leadership has agreed to include a compromise on his wind-v-water amendment, which is known as the COASTAL Act, or Consumer Option for an Alternative System to Allocate Losses Act.
The compromise involves using hurricane data collected by the National Oceanic and Atmospheric Administration in conjunction with engineering formulas to be developed by FEMA to double check flood-insurance claims for total-loss, “slab” properties.
“Use of the COASTAL formula will help prevent the inappropriate shifting of wind claims to the flood program and will empower consumers by providing a better estimation of water losses,” says Rick Curtsinger, a spokesman for Wicker.
Sens. Tim Johnson, D-S.D., and Richard Shelby, R-Ala., agreed to the compromise after adding a provision to the COASTAL formula calling for the National Academy of Sciences to evaluate the scientific validity, anticipated accuracy, and financial impact of the NFIP formula.
Senate Majority Leader Harry Reid, D-Nev., today filed for cloture on a motion to proceed on the compromise bill, which takes the House number, H.R, 1309.
Ray Lehmann, director of public affairs at the R Street Institute, says the Senate appears set to act on the bill on Friday.
Senate action this week would go a long way toward reaching Congress’ latest goal of finalizing legislation by July 31.