New York's U.S. Senate delegation expressed disappointment with the Treasury Department's report on the Terrorism Risk Insurance Act, criticizing its findings as "careless" and based on ideological, rather than factual grounds.
As one of the targets of the attacks on Sept. 11, 2001, and considered among the top potential targets for future attacks, officials from New York have been strong proponents of TRIA, which provides a federal backstop for terrorism coverage. The program is currently scheduled to expire at the end of this year, but legislation extending it for an additional two years has been introduced in Congress.
Last week, the Department of the Treasury released it's report, mandated by the original TRIA legislation. In the report, Treasury said that if the program is to be extended, it should be changed to limit the amount of potential federal support.
Treasury Secretary John W. Snow recommended that the threshold at which the government becomes involved be increased from $5 million to $500 million.
The report is expected to play a major role in the debate on extending the program going forward.
Proponents of the program have argued that TRIA is still needed to ensure stability of economic markets. They argue that its expiration would create a great deal of instability in areas such as real estate development and construction. New York's two Democratic senators echoed these sentiments.
"The Treasury Department's call for removing terrorism risk insurance is careless at best and has the potential to put countless New York businesses in jeopardy," said Sen. Hillary Clinton in a statement. "The administration, GAO and the federal reserve chairman have all acknowledged that TRIA has been instrumental in helping to get so many of New York's businesses back on their feet. By ending the program the administration would be pulling the rug out from under hundreds of institutions that depend on this critical safety net."
In a statement, Sen. Charles Schumer said that the "administration's ideological slant has gotten in the way of a clear look at the facts on the ground." Although the report notes the economy is strong, Sen. Schumer said that large projects will not be able to get financing without coverage against terrorist attacks. "Treasury evaluated TRIA in the context of it being a temporary program, but what is happening on the ground is proof that there is a permanent need to extend this critical risk insurance program."
"The administration can't have their cake and eat it, too. They can't expect to warn of terrorist attacks and not provide the critical insurance programs necessary to rebuild in case of another successful terrorist attack," Sen. Schumer added.
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