May 17, 2012 WASHINGTON -- The federal flood insurance program got another 30-day extension from the House on Thursday, while some lawmakers continue to work for the long-term extension they say is needed to ensure its stability. "I support the House version as a temporary extension to avoid a lapse, but getting to the five-year bill is the absolute top priority," Sen. David Vitter, R-La., said.
Vitter said he will try to get the extension, previously approved by the Senate Banking Committee, attached to a Federal Drug Administration user-fee bill pending on the Senate floor. It's unclear whether Vitter's legislative maneuver will be successful, or allow enough time to get the measure to President Barack Obama's desk by May 31, when the program's current authorization expires.
The House voted 402-18 to keep the program operating through the end of June. It includes a controversial provision to encourage private insurers to enter the market.
If the program lapses, as it did four times in 2010, no new policies can be issued and, as a result, house sale closings in communities where flood insurance is mandatory would be postponed.
Several members said it would send a terrible message to allow the program to lapse the day before hurricane season begins.
There was little support for Michigan Republican Congresswoman Candice Miller's suggestion to repeal the federal flood insurance program, which provided many Gulf state homeowners with money to rebuild after Hurricanes Katrina and Rita.
"So many of us very strongly opposed to ObamaCare, the government takeover of health care because we didn't believe the federal government should be running the health care for our entire nation," Miller said. "But apparently we have no problem with the federal government running a National Flood Insurance Program."
The program, started in 1968, has nearly 500,000 policyholders in Louisiana.
Unlike previous short-term extensions, the bill approved by the House includes what sponsors say are "reform measures," including studies on ways to get private insurance firms to provide coverage. That measure likely would face opposition in Louisiana and Mississippi where homeowners complained private property insurance carriers often attributed damage from Katrina and Rita to water damage, not wind, thereby avoiding paying out on policies.
But Rep. Judy Biggert, R-Ill., the sponsor of the short-term extension, said it's important that Congress take steps to see if private companies can enter the market, thereby reducing the cost to taxpayers.
"This program is more than $17 billion in debt to the taxpayers," Biggert said. "We owe it to the homeowners, to the housing market and to taxpayers to begin the process of fixing this program, even if we must do it 30 days at a time."
Vitter said the privatization study could be added by amendment to the five-year flood insurance reauthorization bill.
Louisiana lawmakers said the top priority is not to allow the flood insurance program to lapse.
"This 30-day extension is short-sighted and kicks the can down the road," said Rep. Cedric Richmond, D-New Orleans. "But at the end of the day, it's our responsibility to make sure that the people of Louisiana are covered."
Rep. Steve Scalise, R-Jefferson, noted that "Since September of 2008, funding for the NFIP has been extended 17 different times. I am much more focused on working to pass a long-term renewal of NFIP rather than these short-term patches that leave homeowners in limbo and don't strengthen the solvency of the program."