Statements on Introduced Bills and Joint Resolutions

Floor Speech

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Mrs. FEINSTEIN. Mr. President, I rise today to introduce the Flood Protection Fairness Act of 2011.

This legislation will make three common sense changes to the National Flood Insurance Program, NFIP, to ensure that the program incentivizes local participation in the funding of flood protection infrastructure.

The bill allows levees paid for with local tax dollars to qualify for the same discounted flood insurance rates as communities that rely on Federal tax dollars to build their levees.

The bill allows Federal Emergency Management Agency, FEMA, to calculate the value of a levee system in current dollars instead of using the uninflated cost of levee improvements completed years ago. This encourages local governments to fix problems as they arise.

The bill allows areas protected by coastal levees to qualify for the same flood insurance rate zones as areas protected by riverine levees, provided they meet equivalent flood protection standards.

The effect of these provisions is simple: local governments will be incentivized to help pay for the flood protection systems in their back yards.

In this time of shrinking budgets we simply can't afford to ask the federal taxpayer to foot the entire bill for flood protection. Federal investments must be leveraged by local and private contributions. Current policy discourages this; so it's time to change the policy.

In some areas of the country, homeowners are told that because their local government built the levee protecting their home, not the Federal Government, that they owe an additional $700 dollars on their flood insurance bill.

These homeowners are not being charged more because they are at greater risk. They are being charged more because the wrong money paid to build their levee. That is not sound policy.

Yet, this is the case in Sacramento, California.

A flood insurance rate map change in Sacramento has classified the area as an AE. This means that many residents living in the area will be forced to pay a rate of $2,187 per year for $250,000 worth of insurance.

However, if the levees protecting these homes were owned by the Federal Government instead of the local reclamation districts and the State or if the Corps of Engineers' approved report was authorized by Congress, the area would be eligible for an A99 zone designation by the middle of 2012. This would mean that the same $250,000 of flood insurance coverage would pay a rate of $1,472 per year.

That is a $715 dollar difference. That is a lot of money regardless of your economic situation.

I want to make clear that this bill is not just some gimmick to undermine the National Flood Insurance Program.

I firmly believe in the strong and rigorous regulations that limit development in flood plains. Development in an unprotected flood plain is dangerous, and I do not support legislation that encourages new construction in hazardous areas.

But the regulations that prohibit local investments from being counted, and prevent coastal communities from having full access to the NFIP are antiquated.

To understand the scope of the problem, it is important to have a little bit of context. FEMA is currently undertaking an extensive Map Modernization effort and examining levees around the country for safety. As FEMA does this, the Agency is learning that many levees do not provide an acceptable level of flood protection. This means that the people living behind these levees are in real danger of flooding, and until recently, were unaware of it.

Fortunately, the Map Modernization effort is bringing all of this information to homeowners and consumers. With this information they are able to protect themselves with flood insurance from the National Flood Insurance Program.

But as I have said, there is actually a disincentive for local governments to pitch in and help build flood control systems; if the locals build the levee, the National Flood Insurance Program won't give homeowners the same discounts they would receive if the levee were built by the Federal Government.

The program does this by limiting which communities can qualify for reduced rate flood insurance zones.

FEMA created the reduced rate AR and A99 zones to reflect a reduced flood risk as the result of an existing or partially completed levee system. But this designation only applies to communities protected by federally funded levees.

Even in Sacramento where residents have approved two property assessment increases to help pay for levee repairs, the homeowners are still hit with higher insurance rates because the improvements are not being paid for by the Federal Government.

The original idea behind this requirement was that information on non-federal levees was unreliable, and we did not know how safe they really were.

That was 30 years ago. Now we have better information, and better science, and FEMA has sufficient data to make sound judgments on levee safety. The rule is antiquated, and it needs to be modernized.

Not surprisingly, other agencies also recognized the need for a change. In California, the Sacramento and West Sacramento Flood Control Agencies, as well as the California Department of Water Resources are seeking this change.

At the Federal level, FEMA has worked with my office and the office of Representative Doris Matsui to develop these common sense modifications.

I commend each of the agencies that worked on this project and I hope to see these changes enacted quickly.

There are already positive signs in the House of Representatives. Just a few weeks ago, Financial Services Chairman Spencer Bachus included text of this legislation in a version of the National Flood Insurance Reauthorization bill. I want to commend Mr. Bachus for agreeing to make this important change, and thank Ms. Matsui for her effective advocacy on this issue.

On the whole, the National Flood Insurance Program and the Map Modernization effort each have taken our nation in the right direction. As a result of their successes, Americans are safer, and have the means and ability to insure their homes even in risky areas. These are not trivial accomplishments.

But a little fine tuning is in order.

Communities looking to improve flood protection in their area should not be penalized for paying for it themselves.

Residents should be charged the same insurance rates if they face the same risk--regardless of who owns the levee that protects their home.

The Flood Protection Fairness Act will make these two important principles clear. I urge my colleagues to join me in supporting this bill and look forward to working with you to ensure its speedy passage.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

There being no objection, the text of the bill was ordered to be printed in the Record,

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