President Signs Flood Insurance Bill
June 30, 2004
President Bush has signed into law S. 2238, The Flood Insurance Reform Act of 2004. The measure will become effective immediately.
Sponsored by Rep. Doug Bereuter (NE) and Rep. Earl Blumenauer (OR), S. 2238 reauthorizes the National Flood Insurance Program (NFIP), administered by the Federal Emergency Management Agency (FEMA), through 2008. The Act passed the House on June 21, under suspension of the rules by voice vote.
Reforms in the law will address the problem of repetitive loss properties through flood mitigation. The law authorizes the launch of a pilot program that will require people to either accept mitigation assistance or face significantly higher premiums. Owners who refuse assistance will no longer be eligible for subsidized flood insurance far below the actuarial risk rate they should be paying. Over time, as mitigation offers change the nature of repetitive loss properties, the NFIP is expected to save a significant amount of money, since FEMA estimates that these properties alone cost the program $200 million annually.
House Financial Services Committee Chairman Michael G. Oxley (OH) said, “The reforms set out in this law fortify the original intent of the NFIP while preventing unacceptable expenses for the taxpayers." Oxley continued, “This law is the result of a lot of hard work and a great bipartisan effort. Congressmen Bereuter and Blumenauer are to be congratulated both for the years of work they put into this legislation and for saving the taxpayers’ money. From the beginning, it was clear on both sides of the aisle that crafting the best solution was a priority. I commend Ranking Member Barney Frank (MA) and my colleagues in the House for coming together to preserve this valuable program."
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