Rep. Gregory Meeks on Biggert-Waters

January 31, 2014

Amending the Biggert-Waters Act to Eliminate Unintended Consequences

By Congressman Gregory W. Meeks

Congressman Gregory W. MeeksSuperstorm Sandy hit parts of New York Cityparticularly hard. And the people living in the neighborhoods and communities that endured the greatest damage and destruction have had a particularly hard time rebuilding and fully recovering from what turned out to be the worst natural disaster in City history. Yet, a lot of people who live in areas that escaped Sandy’s full fury find it hard to believe that the superstorm’s effects continue to disrupt the lives of thousands, if not tens of thousands, of my Fifth Congressional District constituents in the Rockaways, Broad Channel, and the mainland communities bordering Jamaica Bay.

Maybe it’s the footage last summer of rebuilt boardwalks, reopened concession stands, and relaxing beachgoers that inadvertently gave them the impression all had been repaired or rebuilt. Or maybe it’s the failure of the mainstream media to keep the public informed about the scale, scope, time, and resources that rebuilding and resiliency requires.

What I do know is that many of my constituents have encountered all manner of obstacles (some of them understandable, some incomprehensible), including bureaucratic blind alleys, false starts, second guessing, and deliberate delays — as was the case when House Republicans took three months to allow a vote on an assistance package. So, it is not surprising that the recovery process seems like “The Never Ending Story,” “Groundhog’s Day,” and moving the goal posts, rolled up into one ongoing ordeal. Sometimes even programs that are supposed to help ended up hurting them.

A case in point is the Biggert-Waters Flood Insurance Reform Act that Congress passed to shore up the National Flood Insurance Program (NFIP). Instead, the Biggert-Waters Act has created a crisis for many families and businesses that are trying with all their might to rebuild their homes and factories or reopen their stores and restaurants.

The NFIP was created in 1968 to help homeowners, renters, and businesses in flood zones protect themselves from financial ruin by subsidizing flood insurance coverage.

Unfortunately, Hurricanes Katrina, Rita, Irene, Sandy, and a series of unprecedented tornadoes saddled the program with an unsustainable $24 billion debt. Insolvency was imminent. Bear in mind that over the past decade private insurers have steadily pulled out of the home insurance market in flood-prone regions, including cancelling policies or refusing to issue new ones. Without the backstop of a federally-subsidized flood insurance program, millions of Americans whose homes or businesses are damaged or destroyed by future severe weather events would face financial disaster.

Congress had to act. And it did.

In July 2012, it passed the Flood Insurance Reform Act, introduced by Rep. Judith Biggert, a Republican, and Rep. Maxine Waters, a Democrat. This bipartisan legislation’s goal was to save the NFIP from insolvency by extending the program by another five years and adopting a 10 year repayment plan to gradually eliminate subsidized policies.

Biggert-Waters mandated that subsidies were to be gradually eliminated contingent on the Federal Emergency Management Agency (FEMA) adopting new flood maps drawn to reflect the most up-to-date scientific determination of flood zones. Flood insurance rates would be based on the new maps. But last summer FEMA declared that rate increases would go into effect on October 1, 2013. It did this without meeting the remapping requirement. Many policyholders in the Rockaways who were barely holding on as it is saw their rates soar. With no way to afford this additional burden, the new rates could be the straw that broke the camel’s back.

Many of my colleagues and I feel that it is unfair to force Sandy victims to shoulder the burden that FEMA’s action imposes. I have joined with 200 colleagues in cosponsoring the Flood Insurance Affordability Act, which calls for a four year delay in implementing Biggert-Waters as well as requiring FEMA to complete an affordability study in addition to new flood maps before new rates can be imposed.

I am also proposing to further amending Biggert-Waters to:

Direct FEMA to credit policyholders with excessive rate increases.

Place a maximum cap of a 25 percent yearly increase on all new policies after Biggert-Waters was enacted.

Cover primary residences, second homes, and small business properties valued at $1 million or less.

My proposal would remain in effect for two years after the completion of the FEMA affordability study. This way, it would provide relief to new policyholders and help stabilize the local real estate market.