Homeowner Flood Insurance Affordability Actby Representative Steve Scalise
Posted on 2014-01-08
SCALISE. I thank the gentleman from Pennsylvania for his
leadership and for yielding time.
Clearly, when you look at the problems with the National Flood Insurance Program, what brought us to this point were a number of things. One was that the program continued to lapse over and over again. Multiple times, Congress had passed many patches and Band-Aids. And ultimately, we would like to see a private marketplace where people could go buy flood insurance. In fact, the Federal Government requires that people in many areas purchase flood insurance, and yet the only place you can go right now is NFIP. You can only go there to buy this, which is a requirement for people purchasing a home in many places.
So if you look at how the implementation by FEMA is adversely affecting millions of people across the country--specifically, some examples we have seen in southeast Louisiana, in my district, point out these glaring inequalities that have to be fixed by this Congress for this program to work properly. In fact, many of the things that we all want to see to get to an actuarially sound program will be undermined if the FEMA implementation goes forward without the reforms that we have been building a bipartisan coalition to implement.
And if you look at this--I will give you a couple of examples, Mr. Speaker, in south Louisiana. In Terrebonne and Lafourche Parishes, right on the front lines of the Gulf of Mexico, we are not talking about people who have multimillion dollar vacation homes or anything like that. These are hardworking taxpayers, people that work in the oil field, helping produce American energy, people that are middle class families that are being faced now with this rate shock. In many cases, these are people who never flooded.
We have got a levee district that we went and brought some of the FEMA officials out to just a few months ago, the Larose to Golden Meadow Hurricane Protection System in Lafourche Parish. We went out there. This is a levee protection system that was built by local people with local money, not Federal money. This wasn't a levee protection system that was built by the Corps of Engineers which, by the way, the Corps' levees failed during Katrina. These folks down in Lafourche Parish, they built their own levees, and they never flooded in Hurricane Katrina. They never flooded in Hurricanes Rita or Isaac. In fact, this levee protection system was so successful that many of these people never even filed a flood insurance claim. And yet FEMA completely ignores that that levee protection system exists. And some of these people are going to be faced with $25,000-a-year flood insurance premiums.
Now, some people might say that is an actuarially sound rate, but that is going to be a death sentence to those families. Everybody recognizes if you own a $200,000 house and then FEMA comes and says, Okay, your annual premium for flood insurance is going to be $25,000 a year, you are literally forcing that person to walk away from their home. So you are going to lose the money they are already paying into the system; and, again, in many cases, we are talking about people who never even flooded, people who paid their own tax dollars--not Federal money but local money to build a flood protection system that works.
It has worked for all of these storms, and yet FEMA is ignoring the fact that that flood protection system even exists. And ironically, FEMA certified the Corps flood protection systems that failed.
So these are the things that we are trying to address and fix, again, working in a bipartisan way because ultimately we want to see a competitive system. We want to see a system that is actuarially sound. But anybody who thinks that these massive rate increases you would be sending to people who played by the rules and never filed a claim in many cases can pay a $15,000, $20,000 a year premium just for flood insurance when it is much more than they are even paying for their own home note, it is just fantasy. So we are going to continue working to get this fixed, to put in place a system that is actuarially sound in a way where people can continue to play by the rules and continue to keep their homes and continue to be good, productive taxpayers and contribute to our society like they are today. So that is what we are going to continue working on.
Again, I thank the gentleman from Pennsylvania for his leadership.