A picture of Representative Steven M. Palazzo
Steven P.
Republican MS 4

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  • Homeowner Flood Insurance Affordability Act

    by Representative Steven M. Palazzo

    Posted on 2014-01-08

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    PALAZZO. Thank you, Congressman, and thank you so much for putting this Special Order together this evening for us to talk about the devastating effects the Biggert-Waters Act is going to have on flood insurance premiums just not along coastal areas, but all across America.

    For more than 40 years, residents who have lived in flood-prone areas have paid into the National Flood Insurance Program because virtually no private flood insurance market existed. The issues I and my colleagues have spent so much time addressing over the last year affect these 5 million NFIP policyholders.

    What many Americans do not realize is that they could be the next flood victim, and they could be the next victim of these drastic flood insurance hikes and flawed FEMA policies.

    According to FEMA Director Craig Fugate, 40 percent of the U.S. population lives in counties that border the ocean or the Great Lakes and are directly or indirectly affected by flood risk, and most U.S. counties contain rivers and streams that present flood hazards. Forty percent of the U.S. population--that's more than 126 million Americans--could be affected by these issues in the coming years.

    This map shows exactly where you can find NFIP policyholders. We are not just talking about a few people living in coastal areas. This isn't just Mississippi, Louisiana, New York, New Jersey, or Florida's problem. This map hasn't even been updated to include those affected by the recent flooding in Colorado. We are talking about millions of people across America in every single State and just about every single congressional district who will be impacted by these drastic rate increases.

    The Biggert-Waters Act of 2012 was passed with the intention of insuring that the program remained solvent for these policyholders to ensure that it is there for the people who have paid into the system when a disaster strikes. It was never intended to make rates so unaffordable that flood insurance is no longer attainable for these policyholders. Yet when you look at what is happening now and the way FEMA is implementing the law, that's exactly what we are seeing.

    There are those who have said these people are just a bunch of wealthy waterfront homeowners. That is simply not true. I can tell you that's not the case in my district. I am hearing from teachers, veterans, fishermen, people who work at the shipyards in support of our Navy. These are everyday Americans, some of whom live 50 or 100 miles or more inland. These are folks who have been responsible in maintaining flood insurance policies for years and sunken untold thousands of dollars of their own funds into their community's recovery from Hurricane Katrina.

    They built back to higher FEMA standards, many of them invested in mitigation against future risk. They used every tool at their disposal and went to great lengths and great costs to comply with the law and do their part. Now they are being punished for doing that. They are being hit with astronomical rate increases overnight, or worse, they are unable to get straight answers from FEMA or from their flood insurance agents who are looking to FEMA for answers.

    Many are retirement age. One bank in my district has estimated that at least 400 elderly homeowners are facing rate increases that are so drastic that it could force them into foreclose.

    Take Cheryl, a retired special education teacher married to Gerald, a retired aluminum plant worker and a Navy veteran. She says: Please don't think that we live in a waterfront home. We live in an older neighborhood, miles inland.

    She tells me that for 11 months they lived in a camper while working to rebuild, taking ``extra precautions'' and meeting the demands of inspectors and permits throughout the process.

    ``We felt proud to be part of the rebuilding of the Mississippi Gulf Coast'' she says. But she also tells me, ``A large increase could bury us.'' Another military retiree couple on fixed incomes writes that their flood insurance rates have been estimated to rise from $400 a year to at least $4,000 a year. He says: ``Despite doing our `homework' prior to purchase, putting a considerable down payment on the home, doing due diligence following the storm by repairing our home'' that flood map changes and increasing flood insurance rates have put them in the position to possibly lose their home with no fallback.

    Linda, a 65-year old single woman, tells me she hopes to retire after 40 years working as a teacher. She says: Like so many others, I rebuilt my home after Katrina following the guidelines of then current flood maps. If the flood rates go to the proposed levels there's no way I can afford to keep my home. I have worked all of my life, contributed to the community I live in, followed the rules, paid my debts. Now I am faced with losing my home, my retirement, and my sense of security.

    {time} 1745 These are just a few examples of how these rate increases are affecting everyday Mississippians. Millions more like them are all across the Nation, and some don't even realize the storm that is coming.

    We are not just talking about a few folks along the coast. We are not talking about wealthy, waterfront homeowners looking for a taxpayer handout. Anyone who says otherwise is incredibly misinformed or blatantly misleading the American people.

    These people, they are the reason we are here today. They are the reason that Republicans and Democrats from every corner of the country are supporting our efforts. We all share the same goal of ensuring flood insurance remains affordable and available to those who need it.

    [[Page H59]] In this body, we have acted to make compassionate reforms, while keeping this program fiscally sound. We have worked to halt rate increases, address unintended consequences, and hold FEMA accountable for questionable methods and flawed implementation.

    We will continue this fight for those who have been caught in the cracks through no fault of their own, for hardworking, everyday Americans who have followed all the rules and tried to do everything right. Now, we have a responsibility to make this right, and we will not stop until the job is finished.

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