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Mrs. BIGGERT. Madam Chairman, I yield myself such time as I may consume.
Madam Chairman, I rise in support of H.R. 1309, the Flood Insurance Reform Act of 2011. I'd like to thank Ms. Waters and all the Members from both sides of the aisle who helped to craft this bill.
On May 13, the Financial Services Committee favorably reported the Flood Insurance Reform Act by a unanimous vote of 54-0. This bill is important and reflects the hard work and bipartisan support of the Financial Services Committee.
It would reauthorize for 5 years the National Flood Insurance Program, NFIP. The bill would enact a series of reforms designed to, number one, improve NFIP's financial stability; two, to reduce the burden on taxpayers; three, restore integrity to the FEMA mapping system; four, to explore ways to increase private market participation; and, five, to help bring certainty to the housing market.
For over 40 years, taxpayers have subsidized flood insurance premiums for policyholders. To improve NFIP's financial stability, H.R. 1309 phases in actuarially sound rates for policyholders and phases out taxpayer-subsidized rates. As a result, the Congressional Budget Office stated that the bill generates $4.2 billion; and absent a Katrina-like catastrophe, the bill will actually accelerate NFIP's payments on its $17.75 billion debt to the taxpayer. As it stands, NFIP has already paid back taxpayers about $1.8 billion.
But perhaps most importantly, H.R. 1309 eliminates a barrier to the development of a private flood insurance market and puts us on a path towards a responsible, long-term plan that eliminates taxpayer risk.
For the first time, policyholders can choose private flood insurance over government flood insurance without the risk of lender rejection; and the bill eliminates taxpayer-subsidized rates so that the private sector can offer consumers increasingly competitive rates as compared to the NFIP. Second, FEMA is required to solicit bids to determine the cost to the private sector, not to the taxpayer, bearing the risk of flood insurance.
Third, it requires that GAO and FEMA evaluate the feasibility of voluntary, community-based flood insurance. And, fourth, the bill reiterates FEMA's existing authority to purchase reinsurance from the private sector as an alternative to the U.S. Treasury and taxpayers serving as a backstop to NFIP.
Finally, the bill addresses many of the concerns that Members have raised with us about new maps, especially as they relate to the dam and levee decertifications. It allows communities to suspend the requirement to purchase flood insurance while they work to construct or fix their flood protection systems.
Madam Chairman, when Congress created NFIP, there was no viable private-sector flood insurance market. Taxpayers were providing increasing amounts of direct assistance through disaster relief to flood victims. Without reforms contained in this bill, taxpayers will never be paid back the debt they are owed; homeowners and businesses will have limited or no access to flood insurance; and Congress will inevitably have to bail out flood disaster victims, as it did prior to 1968. We cannot allow this to happen.
This bill is the first significant reform to the program in nearly a decade. The NFIP is too important to let lapse and too in debt to continue without reform. I look forward to today's amendment debate and urge my colleagues to support the underlying bill.
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