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"YES" on Senator Toomey's (R-PA) amendment to S. 1926, the Homeowner Flood Insurance Affordability Act
January 29, 2014
NTU urges all Senators to vote “YES” on Senator Toomey’s (R-PA) amendment to S. 1926, the Homeowner Flood Insurance Affordability Act. This amendment would help to preserve the progress made under the Biggert-Waters reforms of 2012 while avoiding painful rate-shock that could have occurred for some homeowners.
The Toomey amendment provides for the gradual phase-out of taxpayer-backed premium subsidies in the case of both home sales and homes re-mapped into higher-risk flood zones. This matches the phase-out implemented under Biggert-Waters for commercial properties, second homes, and severe repetitive loss properties. A means-tested surcharge for National Flood Insurance Program (NFIP) policy holders will keep the additional costs of the extended phase-out period within the program without further burdening taxpayers or increasing NFIP’s borrowing authority.
Given the dire financial straits of the NFIP, indefinitely postponing real reform that brings premiums in line with risk is not a fiscally responsible option. The Office of Management and Budget acknowledged this yesterday with a statement asserting that delaying rate increases under the NFIP would “further erode the financial position of the NFIP, which is already $24 billion in debt. This delay would also reduce FEMA’s ability to pay future claims made by all policyholders.” Further, the Administration signaled support for “a phased transition to actuarially sound flood insurance rates as provided for by that Act [Biggert-Waters]… .” Bringing premiums in line with true flood risk is an important step toward protecting homeowners and taxpayers alike.
NTU strongly supports the Toomey Amendment and others that will help make the NFIP financially stable and encourage the growth of a private flood insurance marketplace. In addition, we urge all Senators to support an open amendment process and a full and vigorous debate.
Roll call votes on the Toomey Amendment to S. 1926 will be significantly weighted in our annual Rating of Congress and a “YES” vote will be considered the pro-taxpayer position.
If you have any questions, please contact NTU Federal Affairs Manager Nan Swift at (703) 683-5700