The House of Representatives passed a bill to extend the National Flood Insurance Program for another month. But with less than one week until the current program is set to expire, it’s up to the Senate to pass the bill before the program runs out of funding on July 31.
HousingWire reported the House passed the legislation on Wednesday that will extend the program until November 30, 2018.
“The bill passed by the House today ensures the program remains available to those Americans who rely upon it, while enabling Congress to continue working toward a long-term reauthorization and reform measure,” said National Association of Realtors president, Elizabeth Mendenhall.
The NFIP began about 50 years ago under the Federal Emergency Management Agency and currently provides flood insurance for nearly 22,000 communities around the nation, according to Mendenhall. Without this bill, thousands of commercial and residential properties located in known flood areas would be left without affordable flood insurance options.
Many are worried about what a lack of insurance during hurricane season would mean. Without NFIP coverage, home sales and post-hurricane recovery efforts in places like Texas and Puerto Rico could suffer, according to a letter sent to Congress by several industry groups.
Some aren’t just arguing for an extension of NFIP funding; they want a reform of the program. SmartSafer, a coalition of environmental groups that advocate for taxpayers, mitigation, housing organizations and insurance stakeholders, is one group pushing for long-term reform.
“We urge Congress to use the next four months to create a comprehensive legislative package that addresses ensures that the program better protects people in harm’s way, the environment and taxpayers,” the company said in a letter to representatives.
Other supporters, like the Union of Concerned Scientists, believe Congress can reform the NFIP by updating the flood risk map, provide communities with more resources to reduce risks before a flood strikes and offer affordable plans for low-income households in flood risk areas. According to the Miami Herald, FEMA was reportedly working on a new initiative that could raise the costs for NFIP users. FEMA could switch to rick-based pricing by 2020 to help with the programs $20 billion debt.
Unfortunately for many homeowners, “The Risk Rating and Policy Forms Design,” as FEMA called it, could double or triple flood insurance premiums and raise the overall cost of living in flood-prone areas.
While FEMA was expected to announce risk-based pricing plan in 2019, the current state of the NFIP leaves FEMA’s plans uncertain. The Senate has until July 31 to pass the extension, which most hope will bring an opportunity to reform the program.