Senate Moves Closer To Long-term NFIP Reauthorization

U.S. Senators Thad Cochran (R-Miss.), David Vitter (R-La.), Mary Landrieu (D-La.) and Kay Bailey Hutchison (R-Texas) today announced an agreement on the treatment of levees under the National Flood Insurance Program (NFIP), which they hope will move the Senate closer to passing long-term legislation reauthorizing the NFIP.

With their backs up against a wall, the U.S. Senate and U.S. House of Representatives passed a short-term extension of the NFIP during the last week of May, giving the Senate until the end of July to come to terms on long-term reforms included in the reauthorization that the House has already passed.

Senators believe the agreement struck on levees is a big step toward achieving that long-term solution.

The original bill was seen as failing to give proper credit to federal, state and local investments in levees and other flood control infrastructure. The proposal approved by the Banking Committee would have imposed land-use restrictions and mandated the purchase of insurance for all areas protected by a levee, including areas in the 500-year floodplain for a 500-year levee. Communities, homebuilders, realtors, floodplain managers and economic developers had raised serious concerns about the proposal's effect on local economies and job creation.

"This compromise helps us get over a significant hurdle in the way of a final agreement. It removes some concerning requirements that would have put a huge burden on communities whose property owners, developers and others have taken the initiative to mitigate their risk of flooding. I look forward to passage by the full Senate," Hutchison said.

The new provision attempts to address those concerns by:

• - Limiting the scope of risk to the natural 100-year floodplain
• - Doing away with land-use restrictions in areas protected by healthy levees
• - Delaying mandated flood insurance in areas protected by healthy levees until FEMA can develop tools to provide full credit for levee protection
• - Waiving mandated flood insurance in areas with minimal flood risk
• - Ensuring that prices in areas protected by healthy levees fully reflect investments made in local flood control infrastructure
• - Allowing FEMA's internal reforms to the treatment of unaccredited levees to continue

The underlying measure that the Senate is expected to consider this week will include the agreement on Areas of Residual Risk (Section 107) to more fairly recognize the protection offered by levees and other flood control structures, eliminating the one-size-fits-all approach taken by the original proposal.