Conservative House Republicans intend to hold legislation reauthorizing a federal backstop for terrorism risk insurance hostage unless they get the slimmed-down version of the bill they support, they indicated Thursday.
They said that means Congress would have to accept a slimmed-down version of the bill this year, no bill at all, or an eight-month extension of the program that would be taken up next year by what they foresee as a Congress where both the House and Senate are controlled by Republicans.
In reaction, a key House Democratic staffer saw no end to the impasse. He said one Republican, Rep. Peter King, R-N.Y., has the support of 30 urban and moderate Republicans for an extension closer to the Senate version, and there are some 20 Republicans “on the other side,” that are demanding a smaller bill.
Rep. Jeb Hensarling, chairman of the House FSC, and Rep. Randy Neugebauer, chairman of the Housing and Insurance Subcommittee of the FSC, both R-Texas, said they will stretch out the process while they educate members of the House on their version of the bill.
“Essentially it looks like TRIA’s not going to be considered in July,” said a Neugebauer aide who declined to authorize use of his name. He made his comment in the wake of passage of a Senate version of the reauthorization bill supported by the industry by an overwhelming vote of 93-4, a vote designed by the Senate to indicate support for TRIA.
Neugebauer and Hensarling believe they have the support of the House Republican leadership in their quest to have their version of the legislation as the House companion to the Senate version, which makes much smaller changes in the program. “We are all locking arms, committed to moving this bill,” the Neugebauer aide said.
“We want to negotiate only once with the Senate, not with our bill on the House floor,” then again during negotiations to reconcile the two bills, the aide said.
The aide meant that Neugebauer and Hensarling would vehemently oppose the House using Democratic votes to send to the Senate a bill much more similar to the Senate bill than the one they have crafted.
The Neugebauer aide said the CBO study “is not an issue” because the Senate bill violates House rules. In a statement, Hensarling also made that point. “Unfortunately, the Senate’s bill is essentially a status quo bill that uses a phony Washington budget gimmick as a pay-for, meaning it can’t even come to the House floor as written,” he said in a statement.
The Neugebauer aide said the headcount undertaken earlier this week by the House Republican leadership indicating the Hensarling/Neugebauer bill would not pass the House as reported out by the House Financial Services Committee is misleading.
The Senate bill is S. 2244, the Terrorism Risk Insurance Program Reauthorization Act of 2014. It would replace a terrorism risk insurance backstop that expires Dec. 31.
The House bill is H.R. 4871, the TRIA Reform Act of 2014.
The House bill calls for gradually increasing the program trigger for all non-nuclear, biological, radiological, and/or chemical (NBCR) events, from $100 million to $500 million by 2019, effectively phasing out the program for non-NBCR events.
“The narrative that’s being driven is everyone’s opposed to our bill and opposed to the process moving forward,” the Neugebauer spokesman said. “That couldn’t be further from the truth. We received a tremendous amount of support from stakeholders. … Perhaps they haven’t been as vocal.”
However, a number of the companies and trades cited by the Neugebauer aide said they supported passage of H.R. 4871 only to start the process of reconciling a House bill they hate with the more acceptable Senate bill.
A key issue for many insurers was cited by Sen. Tim Johnson, D-S.D., in his comments Thursday during floor debate of the Senate bill.
He said the Senate raised the insurer co-pay from 15 percent to 20 percent and the mandatory recoupment from $27.5 billion to $37.5 billion [over five years].
Johnson noted, however, that, “we were careful” in reaching this compromise that the Senate did not raise the trigger, which would drive smaller insurers out of the market and reduce affordability of coverage for business nationwide, and that “this bipartisan bill does not pick what modes of terrorism attacks would get preferential treatment over the other forms of attacks.”
The Neugebauer aide cited a number of insurance trade groups and underwriters and producers that said they support the House bill, but several of the trades and companies he cited said they supported passage of the House bill only to keep the process of ultimately getting a bill moving.
The House Democratic aide was scathing in reaction to the House impasse. He said that, “If so many insurers are supporting the House bill, why are they asking us to help them get a version of the bill more like the Senate version.”
He was also leery as to whether Hensarling has any interest in compromising.
“Hensarling has a different vision of government than most people,” the aide said. Moreover, he said, “Hensarling is not one to make deals.”