Flood Insurance Changes a Disaster for Homeowners, Businesses

As the State Representative for the 3rd Plymouth District, I am confronted daily with difficult policy and constituent issues. However, one many residents of the Commonwealth may not even be aware of is the very real threat to the housing market and overall economy posed by the changes to flood insurance as a result of the federal Biggert-Waters Flood Insurance Reform Act of 2012.

I have received many calls and emails from concerned residents in my district who are worried about the cost of their flood insurance rising. Some are contemplating selling the homes they have lived in all their lives, while others are incurring significant expenses by hiring engineers and other consultants to appeal their properties’ placement in flood zones. 

Passed by Congress in 2012, the Act reauthorized the National Flood Insurance Program (NFIP). Lawmakers in Congress agreed that they had to make changes because the program was billions of dollars in debt. The legislation emphasized the move to risk-based rates and the elimination of long-term subsidies that had kept down rates for homes in flood zones.

Another provision of the bill required that these revisions to the NFIP undergo an economic study focusing on the affected communities. To date, however, this study has not been performed. As a result, homeowners, business owners and local cities and towns do not have vital information on how Biggert-Waters will affect their property values, their wallets and the local economy as a whole. 

I acknowledge that the NFIP program prior to the Biggert-Waters Act needed adjustments and it was necessary for Congress to 'fix' this program via meaningful legislation. However, the Biggert-Waters Act of 2012 as currently implemented by the Federal Emergency Management Agency (FEMA) fails to acknowledge or to address the socio-economic impacts of the mandated changes imposed by the new law. Does the program need to be made fiscally solvent? Yes, but not at the cost of economically destroying or significantly harming the communities the program seeks to benefit and protect. 

This is why I joined with many of my colleagues in the MA House and Senate in writing to the Massachusetts Congressional Delegation, requesting their support for legislation (HR2199) that would delay implementation of Biggert-Waters while the Congress looks to address the law’s shortcomings.

Highlights of the bill include:

• Outlines the process by which FEMA and the National Academy of Sciences can complete the affordability study mandated by Biggert- Waters.
  

• A 3 year implementation delay of Section 207 of the Act, which directs FEMA to increase flood insurance rates for a community that receives a new or revised flood map over a 5 year period.

• A 5 year implementation delay in charging the full actuarial flood insurance rates for newly purchased properties.
  

• Lifting the cap on the dollar amount of state and local funds that may be included when FEMA calculates an insurance premium. FEMA offers more affordable flood insurance premiums to communities that are in the process of improving their mitigation measures. Greater flood protection will result in the future if there is an increase in local investments for mitigation measures as a result of lifting the cap.

• FEMA will be required to include non-structural flood mitigation features on their new maps. These include forests and marshlands and FEMA would work with states and local municipalities to identify such natural features.

This legislation would give both homeowners and businesses assurances that their flood insurance rates will not increase arbitrarily. It is a vitally important step toward providing a long term solution to the National Flood Insurance Program by balancing the NFIP’s solvency while preserving affordability for consumers. I also want to applaud the efforts of our local representative in Congress, Congressman Stephen Lynch, for his leadership on this issue, for signing on to HR2199 and his willingness to advocate for his constituents.

Additionally, legislation temporarily delaying the implementation of Biggert-Waters was recently approved as an amendment to an appropriations bill in the US House. The US Senate held a hearing on the premium hikes just last week and requests for similar language have been made by both constituents and elected officials, myself included.

I would urge my constituents to make their voice heard and contact their Congressional Representatives and ask them to support legislation that would delay the implementation or amend the provisions of Biggert-Waters. Their contact information is:

Senator Ed Markey

1 Bowdoin Square, 10th Floor

Boston, MA 02114

(617)-565-8519

http://www.markey.senate.gov/contact.cfm

Senator Elizabeth Warren

2400 JFK Federal Building

Boston, MA 02203

(617)-565-3170

http://www.warren.senate.gov/?p=email_senator

Congressman Stephen Lynch

88 Black Falcon Avenue, Suite 340

Boston, MA 02210

(617)-428-2000

https://lynch.house.gov/contact-me/email-me

For more information on FEMA, flood insurance, the Biggert-Waters Act or the process of appealing the placement of your property in a flood zone, you may also visit FEMA's web site:

http://www.fema.gov/flood-insurance-reform-act-2012

99 High Street
Boston, MA 02110
1-877-336-2734

FEMA-R1-info@fema.dhs.gov