Flood Insurance Reform and Modernization Act of 2006
FLOOD INSURANCE REFORM AND MODERNIZATION ACT OF 2006 -
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Mr. NEY. Mr. Chairman, I thank Chairman Oxley of the committee, and I rise today to support H.R. 4973, the Flood Insurance Reform and Modernization Act of 2006, also known as the FIRM Act.
This important measure, approved by the House Financial Services Committee on March 16, will significantly reform the National Flood Insurance Program and ensure its continued viability by increasing accountability, eliminating unnecessary Federal subsidies, and updating the flood insurance program to meet the needs of the 21st century.
Last year, in the immediate aftermath of Hurricane Katrina, I introduced H.R. 3669, the National Flood Insurance Program Enhanced Borrowing Authority Act of 2005. That piece of legislation increased FEMA's borrowing authority for flood insurance by $2 billion, which went a long way in helping the Department's flood insurance response.
Since that time, FEMA estimates that it will need a total of $25 billion in borrowing authority to cover claims. These claims from homes and businesses that have been damaged or destroyed by Hurricanes Katrina, Rita, and Wilma are not a new obligation. They are the result of a legal promise that we made to those homeowners and business owners when the Congress passed the National Flood Insurance Act of 1968 and subsequent revisions.
Every single one of these claims represents someone who has taken the responsible course of action by purchasing flood insurance and paying premiums to the government. We not only have a legal obligation to honor our commitments, but we have a moral obligation, Mr. Chairman, to provide the coverage we promised to provide to those citizens.
Small business owners will be eligible to purchase business interruption coverage at actuarial rates to better prepare them to meet payroll and other obligations during the next big storm. And for the first time since 1944, the bill updates maximum insurance coverage limits for residential and nonresidential properties.
Our subcommittee in the Financial Services Committee, under the leadership of Chairman Mike Oxley, Mr. Baker, Mr. Frank, Congresswoman Maxine Waters and others, has spent considerable time on flood insurance reform in the past several years. In 2004, the Bunning, Bereuter, Blumenauer Flood Insurance Reform Act addressed and strengthened the operations.
I urge my colleagues to support this important piece of legislation.
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