Legislation to delay or stop premium rate hikes under the federal flood insurance program is back in the U.S. Senate's hands, but language within HR 3370 is unclear and not sufficient for all policy holders -both residential and commercial- on Fort Myers Beach.
Last week, the U.S. House of Representatives approved a modified version of a bill regarding the Homeowner Flood Insurance Affordability Act, one that would prohibit FEMA, the country's disaster agency, from "increasing flood insurance risk premium rates to reflect the current risk of flood for certain property located in specified areas subject to a certain mandatory premium adjustment." It would also disallow FEMA from "reducing such subsidies for any property not insured by the flood insurance program as of July 6, 2012, or any policy that has lapsed in coverage as a result of the policyholder's deliberate choice (Pre-Flood Insurance Rate Map or pre-FIRM properties)."
Beach Councilman Dan Andre, who purchased his Mango Street Inn property prior to July 6, 2012, has been in touch with the offices of Sen. Bill Nelson and Sen. Marco Rubio and says he will continue to write letters. He stated officials at both offices are unsure what type of policy holders are included in the House version of a flood insurance bill.
"The problem is nobody knows if commercial properties and secondary residences are included in it. It doesn't seem like they are at this point," Andre said.
Mango Street Inn is one of several small businesses that has witnessed an eye-popping, premium increase in its commercial flood insurance policy. The proposed bill should at least delay Biggert-Waters Flood Insurance Reform Act of 2012, a law to reform the National Flood Insurance Program.
Andre and fellow Council members have encouraged Beach residents and business owners to contact their senators to urge them to consider all involved property owners -all home owners and commercial property owners that hold policies since purchase, not just primary residences and homes purchased after the above date. Council sent a letter to House legislators prior to their action.
While proposed legislation is unclear regarding particular policy holders, Andre is encouraged about a one-percent rule within the language of the House version of the bill.
"One thing I really like about the House bill is that they are pushing for this one-percent feature," he said. "That would mean there are no unknowns. It would be no more than one percent of your flood insurance policy. That can be budgeted."
On Jan. 30, the Senate voted for rate-hike relief for millions of homeowners across the country covered by the National Flood Insurance Program. That bill contained language to delay large premium increases for up to four years for those coastal property owners affected due to updated government flood maps. During that proposed delay, FEMA would be required to study the affordability of policies and re-evaluate the accuracy of new flood maps.
The House then reviewed the bill and made its modifications to it. That bill was passed 306 to 91 (with 33 no votes) on March 4.
The Senate is now reviewing the modifications and is expected to vote on the bill in the near future. If it passes, it goes to President Barack Obama.
"Although it doesn't go as far as the bill we passed in the Senate, it's good the House has approved some curbs on flood insurance," said U.S. Sen. Bill Nelson. "For the sake of policyholders facing massive rate hikes, I hope we can get a final version sent to the president quickly."
The Biggert-Waters act was intended to make the flood insurance program more financially sound. The program -which is currently suffering a debt of roughly $24 billion- was in a downward spiral exacerbated by damage caused by Hurricane Katrina in 2005.
Originally, Biggert-Waters was supposed to undergo an affordability study before it was signed into law, but Congress never authorized the funds for that study. Instead, some lawmakers are using that oversight as the basis for passing the Affordability Act.