As California contemplates departure from the National FloodInsurance Program (NFIP) and new cabinet picks begin making theirmark on the federal landscape, Congress has begun to turn a portionof its efforts to reforming and reauthorizing the program.
NFIP started out as a bridge to a fully private flood insurancemarket, but was re-engineered by bureaucratic edict in 1978 tobecome a federal flood insurance monopoly. It now owes taxpayersmore than $23 billion, despite the efforts of a new generation offocused and committed NFIP officers and staff.
Introducing reform
Hoping to beat the clock on Congressional reauthorization ofNFIP scheduled for September, Washington lawmakers have introducedreform legislation. Representatives Dennis Ross (R-Fla.) and KathyCastor (D-Fla.) reintroduced the Flood Insurance Market Parity andModernization Act, which states that qualified private floodinsurers must be recognized and accepted by lenders on the samebasis as NFIP. The bill is designed to correct certain confusinglanguage found in prior legislation. Senators Dean Heller (R-Nev.)and Jon Tester (D-Mont.) introduced a companion measure in theSenate.
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