A plan to roll back the controversial overhaul of the federal flood insurance program, which threatened to skyrocket premiums in communities all aver Florida, overwhelmingly passed the U.S. House Tuesday evening.
The bill, HR 3370 – known as the Homeowner Flood Insurance Affordability Act of 2013 – passed with bi-partisan support 306 to 91, with 33 abstentions. Of the 91 “no” votes, 86 were Republicans, and only 5 Democrats.
The measure came to the House floor under exceptional rules, reports Matthew Daly of the Associated Press, which limited debate and required a two-thirds vote.
There was Tea Party and conservative opposition, mostly by those who believe the bill would continue unfair federal subsidies for people choosing to live in flood-prone areas.
Also opposing the bill were a few environmental groups, Daly writes, that claim continued climate change will increase the risk of flooding in coastal areas. Rebuilding in flood-prone zones is foolish and wasteful, they say.
Bill co-sponsor Rep. Michael Grimm said the legislation would ensure families across the country, including those still recovering from Superstorm Sandy, can escape “a wave of devastating premium hikes and foreclosures.”
The bipartisan bill substantially toned down the 2012 Biggert-Waters Act, which attempted to get hundreds of thousands of homeowners off federally subsidized flood insurance rates. The National Flood Insurance Program is currently $24 billion in debt, partly due to claims paid to victims of both Sandy and Hurricane Katrina.
Biggert-Waters required extensive updates to the Federal Emergency Management Agency flood maps used to determine insurance premiums.
Last night’s House bill permanently repeals the provision imposing steep rate increases on homeowners in flood-prone areas. The bill also upholds below-market rates for homes that meet federal flood map standards.
Also addressed is the “information gap” created by Biggert-Waters, by providing a rebate for those who had limited access to information about sizeable rate increases on older homes.
Although the bill freezes rate hikes, some premiums will continue to rise, but at controlled rates. For example, people who own second homes located in flood zones, areas that flood regularly could still see premiums go up by 25 percent a year until reaching a level consistent with their true risk of flooding.
Reaction in Florida to the passage of HR 3370 was quick and generally positive, with Gov. Rick Scott one of the first state lawmakers to respond.
“Our state is grateful for the work of US House Speaker John Boehner and the bi-partisan coalition for the passage of this legislation, Scott said in a statement. “ This legislation will help to ensure the long-term viability of the NFIP by establishing a reasonable glide path to rate adequacy without causing undue harm to its real estate market and continuing economic recovery.”
Last week, Scott went to Washington D.C. to meet President Barack Obama and asked him to exercise executive authority to suspend flood insurance premium increases. Scott also called U.S. Sens. Bill Nelson and Marco Rubio in September in early steps to address the problem.
U.S. Rep. Gus Bilirakis, who represents much of North Pinellas County, an area facing some of the biggest financial affects of Biggert-Waters, pleaded with lawmakers to support the changes Tuesday night.
“Middle class retirees and those on fixed incomes are those that are suffering with rate increases of $10,000 or more, and they risk losing their homes,” the Palm Harbor Republican said during the final deliberations before the vote. He also warned Congress that not passing HR 3370 would destroy all the reforms made to the NFIP.
“We cannot let the perfect be the enemy of the good,” he said.
“After bipartisan and bicameral negotiations, the House passed legislation that will provide immediate relief to homeowners struggling to keep their homes, ensure that all participants in the program are treated fairly, and provide stability within our fragile housing market,” said Bilirakis in a statement afterwards.
Rep. Joe Garcia, a strong supporter of the “critical reforms” in HR 3370, also released a statement praising the passage, but remained guarded about future insurance rate hikes.
“I am pleased to see that provisions triggering the highest rate increases will be repealed, and that homeowners will be refunded” the Miami-Dade Democrat said. “However, I am disappointed that many home and small business owners will continue to face unfair and unrealistic premium rates. I remain as committed as ever to fighting for stronger, longer-term solutions that will protect every policyholder within my district and throughout the country.”
Rep. Tom Rooney, who represents a wide swath of central Florida from Tampa Bay to the western shores of Lake Okeechobee, also cautioned that the bill could only be a temporary fix.
“While this is a good first step, it does not solve the problem,” Rooney said. “What we need is a long term solution to make flood insurance more affordable for middle class families and small businesses in Florida and across the country.”
In his comment, Republican Rep. Dennis Ross, whose area is the northern parts of Hillsborough and Polk Counties, brought up a private marketplace as the solution, rather than a legislative “quick fix.” The Florida legislature is currently considering a framework for allowing insurers to write private flood insurance policies statewide, a proposal put forward by State Sen. Jeff Brandes.
“Right now, the NFIP is really the only game in town,” Ross said, “leaving homeowners with one choice and one price.”
“The private market can take on more risk without putting taxpayers on the hook,” he added. “Private insurance companies can offer homeowners more options and more affordable policies that the government cannot.”