Congress may act today on delay legislation for BW-12

The US Congress is acting on key legislation, possibly today, on the
National Flood Insurance Program that will affect you, your community, state or
program. We ask that you read this alert and contact your senator or
representative to inform them how their action on this matter will impact
effective flood loss reduction efforts.

S. 1846, introduced by Senators Menendez (D-NJ), Isakson (R-GA) and Landrieu
(D-LA), could come up for a vote on the Senate floor as soon as today. There
is considerable pressure from proponents to consider the measure this week, but
if that does not occur, it will be delayed until the week ofJan.
27because Congress is in recess the week ofJan. 20.

It is likely that an amendment or alternative legislation will be introduced to
provide for a much longer phase-in glide path for premium rate increases
resulting from many of the subsidy removals called for in the Biggert-Waters
flood insurance reform bill enacted July 6, 2012. Specifically, S. 1846 and any
alternative would apply to Section 207 (grandfathered rates and rate increases
due to map changes), and to the provision in Section 205 moving rates on
primary residences to actuarial rates at the point of sale.

S. 1846 provides for at least a four-year delay in implementation, pending
completion of the study of affordability issues, development of legislation to
address affordability concerns and certification by FEMA that all flood maps
are accurate. This latter requirement could result in indefinite delay.
Biggert-Waters provides a five-year authorization for the NFIP and one year has
already elapsed. In effect, S. 1846 would negate the removal of subsidies
(discounts) for the entire current authorization for the NFIP.

ASFPM has provided testimony to Congress urging consideration of a much longer
phase-in glide path rather than a delay. We note the critical need to respond
to the significant difficulties resulting from anticipated dramatic premium
rate increases and are working with Congressional offices to develop
alternatives as well as with agencies to identify other programs that can use
to help with affordability issues. But, we also recognize the benefits BW-12 is
having with increased interest in risk reduction through mitigation that is
occurring due to realistic risk messaging resulting from knowledge of
actuarially sound rates. ASFPM has heard from members across the country that
the reality of current or future rate increases is driving interest in hazard
mitigation like never before. In order to promote hazard mitigation – at the
property owner and community levels – it is important to retain the impetus
that Biggert-Waters provides, while offering an alternative means of addressing
the pain of rate increases. ASFPM also strongly supports completion of the
affordability study and subsequent development of other means of addressing
affordability issues. A link to ASFPM’s Nov. 19 testimony is here.

Contact your senator’s offices today to express preference for a phase-in glide
path alternative, if one is offered. For those who cannot initiate contact with
senate offices, it is hoped that you will express this view if asked for your
opinion.