Senators optimistic on prospects for flood reform

by R.J. Lehmann on February 15, 2012

Sens. Jon Tester, D-Mont., and David Vitter, R-La. – authors of a bipartisan letter urging Senate leadership to schedule a vote on the Senate Banking Committee’s flood insurance reform legislation – both say they are confident that the bill would receive the 60 votes needed to avoid filibuster should the measure make it to the Senate floor.

Tester and Vitter appeared at a Feb. 14 Capitol Hill press conference with the CEOs of a number of organizations – including American Rivers, the National Wildlife Federation, the National Association of Mutual Insurance Companies, the Reinsurance Association of America, Taxpayers for Common Sense and the Heartland Institute – to press for immediate passage. Tester and Vitter’s letter now has signatures from 41 members of the Senate.

The National Flood Insurance Program currently is set to expire May 31, one day before the start of the 2012 hurricane season. Heartland Institute CEO Joseph Bast noted at the press conference that, while Heartland believes the bulk of flood insurance should ultimately be written by the private sector, the reform bill takes a number of important first steps toward that goal, including phasing out subsidies and opening the program to private reinsurance.

As reported by National Underwriter:

Tester acknowledges that support for the bill is not the holdup; the holdup is that Reid is concerned that McConnell will seek to use the must-do bill as an engine to push through controversial provisions opposed by Senate Democrats.

“Sen. Vitter and I are very well aware that that possibility exists on all bills, and we will have to work hard to ensure that the bill remains as narrow as possible,” Tester explains.

Vitter adds that, “for no good reason the NFIP has been shut down for 53 days in 2010” because an extension to the program ran out.

As a result, adds Vitter, 1,400 home closings were either cancelled (or) postponed.

The more than six-year-long odyssey to pass significant reforms to the flood program now arguably stands closer than it ever has to completion. There are few differences the House bill, which passed by a 406-22 margin in July 2011, and the bill referred out by the Senate Banking Committee in September.

Alas, even as one set of flood insurance subsidies appears finally, after more than 40 years, on their way out, already there are efforts underway to create new ones. Rep. John Garamendi, D-Calif., who many may remember was California’s insurance commissioner from 1991 to 1995 and from 2003 to 2007, has introduced legislation that would provide subsidies to farmers whose land is impacted by the downgrade of aging levee systems.

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