NU Online News Service, July 29, 3:49 p.m. EDT
WASHINGTON–The House has passed legislation extending the National Flood Insurance Program, that was due to expire in two months, until March 31, 2010.
The measure was combined with legislation introduced recently by Rep. Doris Matsui, D-Calif., aimed at making it easier for states and local communities to restore or improve their flood protection systems.
The bill (H.R. 3139) now goes to the Senate for approval. In seeking an extension, Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, said more time is needed to work with the Senate on a comprehensive overhaul of the flood insurance program, which insures properties worth approximately $1 trillion in flood-prone areas.
The extension until March 31 is a compromise. Rep. Frank had sought a year's extension, to Sept. 30, 2010, but Republicans balked, agreeing only to the six-month extension, according to several insurance industry lobbyists.
The current extension expires Sept. 30, the end of the current federal fiscal year, and Rep. Frank said that is not enough time to work with the Senate on a reformed and modernized program because of the press of other business.
A spokesman for Rep. Frank said it is unlikely the Senate will act on the legislation before it leaves for a month-long recess Aug. 7, but he said he is certain the Senate will act before the current authorization expires.
The legislation by Rep. Matsui makes technical changes to the NFIP to take local, state and federal funding into account when determining flood zone designations.
"My legislation will ensure public safety remains our first and foremost goal, while assisting communities that are modernizing their existing flood protection systems by giving them definable milestones to meet," Ms. Matsui said in a statement introducing the bill.
She said the bill "will give communities clarity to help them restore or improve their flood protection systems."
Leigh Ann Pusey, president and chief executive officer of the American Insurance Association, said in response to House action, "We are pleased that Congress continues to recognize the need to keep this program from expiring and we look forward to the Senate taking action on the extension soon.
"It's critical that we make sure coverage remains available for citizens living in flood-prone areas," she added.
Kathy Mitchell, federal affairs director for the National Association of Mutual Insurance Companies, added, "Clearly, we cannot allow the NFIP to expire, which could be devastating to those policyholders who live in flood-prone areas and to the nation's already weakened real-estate markets."
David A. Sampson, president and CEO of the Property Casualty Insurers Association of America, said the PCI "will continue to work with Congress on needed reforms to the program, a long-term reauthorization, and restoration of the program to fiscal soundness, which is the necessary solution for this vital program."
Charles E. Symington, senior vice president for government affairs for the Independent Insurance Agents and Brokers of America, said the extension should provide Congress ample time to continue work on long-term improvements to the program.
He said that as passed through different bills in the House and Senate in 2007 and 2008, the legislation would have extended the program for 5 years and made significant and needed reforms to help put the program on sound financial footing.
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