EDITORIAL Open Season for Hurricanes

In reading over the 150-page property bill one is struck by two propositions: Namely, every designated program enacted by lawmakers will do nothing to protect homeowners and shield the market from the financial havoc that will follow if a major hurricane makes landfall in the state. Secondly, lawmakers and regulators realized they have reached the outer limit of what they can do to insulate the state and consumers from this reality.

Take for example the rapid cash build up program aimed at shoring up the Florida Hurricane Catastrophe Fund. The plan is designed to raise more money by allowing the fund to increase its assessment by 25 percent. On paper the plan sounds innovative and promising, but the fact is it will only produce $200 million more. Compared to the damage from even the most minor of storms, the program reminds me of the definition of yachting as being the equivalent of standing in a cold shower while tearing up 100 dollar bills as fast as you can. That is not to look down at $200 million. It is just recognizing a reality that there are not billions of dollars out there to reload the Cat Fund, which consumers may learn is now propped up by assessments.

That is one reason why lawmakers felt that they had to find a tangible way to immediately relieve homeowners' financial burden. Searching through the state budget, they found $715 million in sales tax dollars to offset Citizens' current $1.73 million deficit. In effect, this will reduce Citizens' assessment from around 11 percent to 2.5 percent, which will save homeowners hundreds of dollars. Still, it leaves $800 million that will have to be paid off over eight years. Today's relief, however, raises tomorrow's questions. How many times can the state afford to be so generous and what happens when the dollars are simply not there?

Recognizing that issue, lawmakers and state officials are placing more emphasis on sending a message to homeowners that they need to take responsibility for reducing their hurricane risk. For many lawmakers, a major step in this process was creating the Florida Comprehensive Hurricane Damage Mitigation Program (another example of the proposition that if you give a government program a long enough name it will somehow magically produce great results). While serving up $250 million in tax dollars for grants to help homeowners reduce hurricane damage, the program is a classic attempt by lawmakers to lead by example. For the true message to consumers is board-up your homes, open your checkbook to the reality of higher rates, follow evacuation orders, and otherwise hold on. Bluntly put, it is no longer good enough to just lock the door and drive inland to the nearest Motel 6.

Like any legislation, the property bill has parts good, some bad, and others ugly. But reading between the lines, the fact is that lawmakers understand there are no grand solutions and that each major storm will have to be addressed on its own merits. The only hope is that somehow the state is spared this year, which will give the Cat Fund, Citizens, and the private market time to accumulate more capital. Absent that reprieve, the truth is nobody knows — including lawmakers — how much strain the state can bear.