Homeowner Flood Insurance Affordability Act of 2014—Motion to Proceed—Continuedby Senator Richard J. Durbin
Posted on 2014-01-28
DURBIN. Mr. President, I ask unanimous consent that the order for
the quorum call be rescinded.
The PRESIDING OFFICER. Without objection, it is so ordered.
Mr. DURBIN. Mr. President, I grew up in East Saint Louis, IL, on the banks of the Mississippi River. As a child, it was a dominant feature in my life--crossing that river, watching that river. It didn't take long as I grew up to realize that that river has a mind of its own.
Last year, because of drought conditions in the Midwest, the Mississippi River was so low in January and February of 2013 that the Army Corps of Engineers had to come out on an emergency basis and literally scour the bottom of the river of rock formation so that navigation could continue. We were worried that we would have to shut down this major economic artery in the Midwest because the river was so low. The Army did a great job. The navigation continued with only slight delays and no major interruptions. Within 60 to 90 days, that same river was at flood stage. That is what those of us who grew up in the Midwest come to expect and understand--the unpredictability of that river. As we grew up and started to look around, we realized there were bluffs behind us that at one point were the banks of this great river and that we were living in the flood plain, if you will--that area close to the river that once was totally under water, way back when.
So there were flooding episodes, as most communities went through, and efforts made to deal with that flooding, including the building of levees. Those levees, for the most part, on the Illinois side of the river have been reliable. Some have questioned whether they can meet 500-year standards or these epic floods, and I think the question is well worth asking. But the fact is that the efforts made on the Illinois side--I can't speak for others, but at least in that region-- have really been up to the task and we have not had serious flooding in a long time in that part of the world.
Because of concerns raised by the Army Corps of Engineers about whether these levees that protect the towns and businesses and families were up to the job, something remarkable occurred. Leaders who lived in the counties--and I will be more specific in a moment--closest to that area got together and said, We are not going to [[Page S513]] wait on the Federal Government. We are going to impose a tax on ourselves and raise tens of millions of dollars to start fortifying these levees to protect our towns and businesses. I don't know if that has ever happened anywhere else. We have to salute them. They weren't waiting for Uncle Sam to show up and ride to the rescue; they took it into their own hands. Well, I salute them because they did raise the money and they are prepared and they are fortifying those levees.
I love the Army Corps of Engineers. They came to our rescue last year. But the locals have asked the Army Corps of Engineers to come in and certify these levees, that they are stronger now than they ever were, and the Army Corps has been slow to do it. It is frustrating. The locals are doing everything we could ask of them and they aren't getting at least a timely response from the Army Corps of Engineers. So, as a consequence, we are living in this uncertain world.
All of these businesses, all of these towns, all of these families in this so-called flood plain believe they are protected by the levees, the levees have not been certified by the Corps, and now comes the new National Flood Insurance Program which says to the people living there that they are going to have to pay higher premiums for flood protection in the future. The people rightly said, Wait a minute. We are paying higher sales taxes; we voted to pay higher sales taxes to protect ourselves, and now we are being told we still have to pay higher premiums. That gets to the heart of why we are on the floor discussing the National Flood Insurance Program.
Now I wish to say a few words about my position on this issue because it is one I have struggled with, to try to find the right answer in light of what I think is an extraordinary, if not heroic, effort by local people to address their problem and not wait for the Federal Government, their frustration of not having at least a timely cooperation by the Army Corps of Engineers, and now the prospect that the premiums for their flood insurance are going to go up despite their best efforts to protect themselves. If they were doing nothing, standing back and saying, This isn't our worry; if something bad happens, Washington will ride to the rescue, that is one thing. But they are doing something specific that costs them money and they are trying to protect themselves.
Rapid increases in flood insurance premiums, which are on the horizon, are hard for many people in my State. For the people in Metro East, which is the area I just described which is on the eastern side of the Mississippi River across from St. Louis--the southwestern part of Illinois--for many of them this increase in these premiums would be impossible for them to pay. Forty percent of the Metro East I have just described is mapped as flood plain, and most of the National Flood Insurance Program policyholders there have their premiums subsidized. This meant that instead of paying $500 a year, they were paying about $150. It made it more affordable to them. However, the new increases that are anticipated could be as much as 400 percent.
In Granite City, IL, policyholders paid $585 last year for flood insurance, but with the new increases, the premiums are expected to rise to $1,500 or even $2,000 a year. For some people, $2,000 a year may not sound like a sacrifice. But for hard-working families in small homes they have worked hard to buy and build, another $2,000 a year can make some real impact on their lives.
Additionally, 30,000 new structures in Metro East could be newly mapped into a flood plain when FEMA finally finalizes its flood maps. These homeowners could end up paying $500 to $2,000 a year for flood insurance. Allowing their premiums to rise so high so quickly is unacceptable, especially given how the people in Metro East have worked together over the last 7 years at significant expense to themselves to improve the 74-mile levee system.
In 2007, the Army Corps notified Metro East locals that their levees needed improvement. The next year FEMA notified them that much of the area would be mapped into a flood plain, triggering mandatory flood insurance purchase requirements unless the levee was improved. In response, the three Metro East counties I mentioned earlier--Madison, Monroe, and St. Clair, where I grew up--taxed themselves to pay for the improvements to their levees. They raised $150 million. I believe this type of local commitment is unprecedented. I don't know if anyone else is doing this. They did it.
There have been a number of setbacks, but when they occurred, I have tried to work with the Army Corps and with my colleagues in Congress to get these projects back on track. I commend the people in Metro East for working together to honestly address the threat of flooding. No community wants to go through the pain and loss of damaging flooding. The Presiding Officer has been through it in West Virginia. I have been through it. Twenty years ago, in 1993, there was horrific flooding on the Mississippi River and there have been several instances since. I was out there piling up the sandbags with a lot of folks trying to protect homes and businesses.
These communities in Metro East are actively doing something to prevent the recurrence of that kind of a disaster. So while the locals continue to work with the Army Corps to achieve the highest level of levee protection as quickly as possible, I am going to continue to make their work a priority in my efforts. Because the residents of Metro East have taken on a significant financial commitment to protect homes and businesses, I will work to ensure that flood insurance premiums are affordable.
I wanted to draw attention to the way the residents of Metro East have taken the initiative to help protect themselves from the risk of flooding, because not every community is engaged as directly with this threat as they have been. My constituents in this part of the country, for the most part, cannot afford to buy flood insurance at the new levels and the new rates.
I agree with the effort underway by Senators Menendez, Isakson, Landrieu, and others to slow down these increases, and that is why I am supporting their effort. But we need to do this with our eyes wide open. The National Flood Insurance Program is not going to keep up with the costs of recovery from severe weather events that we see on the horizon.
The National Flood Insurance Program provides nearly 6 million business owners, homeowners, and renters $1.2 trillion in coverage. The problem is the program simply doesn't collect enough money to cover the costs of rebuilding communities from floods, hurricanes, and other disasters.
The flood insurance program will be more than $20 billion in debt after making payments for Superstorm Sandy. If we in Congress continue to ignore the structural weakness in the flood insurance program, that deficit, that debt, that shortfall is going to grow in the future. We can and should, sadly, expect more intense extreme weather events. According to computer models, the changing climate means the storms we are seeing will become stronger and more extreme in the future, causing even greater amounts of damage. Nationwide, the financial consequences of weather-related disasters and climate change hit an historic high in 2012, causing over $55 billion in damages.
I had a hearing on this issue, and I thought: If I bring in environmentalists, a lot of folks will discount it completely when they start talking about climate change. They may not attend. They may walk out of the room. So instead I brought in people from the property and casualty industry, the insurance industry. What do they do for a living? They watch the weather. They watch it more closely than any politician ever did, and they decide adequate premiums to cover the reserves needed to protect from these weather disasters.
The story they told us was: Get ready. The weather is going to get more extreme, and the costs and damages are going to grow dramatically. Some insurance companies--major insurance companies--have walked away from States, saying: There is just too much exposure there. We cannot charge premiums and collect enough to create a reserve in the instance of a natural disaster.
Now, that is the reality of the private sector analysis of this issue. This is not some--pejorative term--tree-hugging environmentalist musing about possibilities. These are hardhearted actuaries and accountants taking a hard look at what the future [[Page S514]] holds. The private insurance industry has looked at the scientific data, and they have made changes in the way they do business. They are adjusting their operations to prepare for worse weather and bigger losses. They have begun raising premiums for wind, earthquake, and flood insurance in areas where disasters are likely, ensuring the rates accurately reflect the risk of damage. The industry has also begun to refuse insuring properties in states where there is just too much risk. In contrast, the Federal Government has not adequately prepared to handle the growing number of severe weather events.
Well, Senator Durbin, where does this leave you? You do not think your people can afford to pay the higher premiums, and yet you do not think the reserves set aside for the flood insurance program are adequate.
I think that is the reality of what this political vote is likely to show.
Yesterday the vote on the floor was an overwhelming bipartisan vote to go forward on this measure. We know the Flood Insurance Program will not be able to keep up with the damage inflicted on our communities. The cost--asking homeowners and businesses to pay dramatically more in flood insurance premiums--is too high to make the National Flood Insurance Program viable in the near future.
We need to recognize that losses from future floods will likely cost more than the National Flood Insurance Program can cover. And then--and that is why I think we need a dose of reality in this Chamber and on Capitol Hill--Congress has to step up. That is a reality. We know these disasters are likely to occur, and we cannot--will not--collect the premiums necessary to create the reserves to cover them. It will be our responsibility to ensure that help is there. Whether that disaster is in Kansas, Illinois, West Virginia, or anywhere across the United States, Congress cannot deny that help.
It is time that we seriously address the effects of climate change and rethink how we protect and provide disaster assistance to communities on a regular basis. Those who choose to ignore the overwhelming scientific evidence of climate change cannot ignore the overwhelming accounting evidence that the National Flood Insurance Program will not be able to meet the increasing expense of natural flooding disasters.
Our votes--if we pass this measure before us--may spare families from an unacceptable financial burden if flood premiums skyrocket, but they do not spare us from the reality that the damages from future flooding disasters will be nationalized, as the damages of Katrina and Sandy were.
Those who vote for this Menendez-Isakson-Landrieu measure--as I will--are voting at the same time to nationalize the cost and damages of future disasters, to say that this is going to be something we will respond to as needed. I have done that throughout my congressional career in the House and Senate, stood up to help those regions of the country in trouble, from California all the way to the east coast, and I will do it again because I think it is an American family responsibility. There is a limitation to what this National Flood Insurance Program can achieve. There is certainly a limit to how much working families can pay for these premiums. And we have to accept the reality that when these flooding events occur, when these disasters occur, we have to accept that responsibility.
I yield the floor.
The PRESIDING OFFICER. The senior Senator from Kansas.