FEMA Administrator Outlines Next Steps for Flood Insurance Law

Press Release

Congressman Steven Palazzo, (MS-4), Vice Chairman of the Subcommittee on Emergency Preparedness, Response, and Communications, today at a hearing questioned FEMA Administrator Craig Fugate on the progress of implementation of the Homeowner Flood Insurance Affordability Act. The law, which passed with overwhelming bipartisan support in both the House and Senate earlier this month, was the product of more than a year of work by Palazzo and House leaders.

Palazzo addressed Administrator Fugate, stating:

"I know you were in front of a Senate panel, I believe last year, and you were discussing the affordability issues with Biggert- Watters 2012 and you called on Congress to help you with that. And we responded and we did: in a bipartisan and bicameral way. Just this past Friday, the president signed into law the Homeowner Flood Insurance Affordability Act. The key word is affordability, and we think that we have given that to you. We all know Biggert-Waters had a lot of unintended consequences and our number one priority - for many members of Congress from the coastal areas - remains available and affordable flood insurance for the homeowners that need it. The law that was just recently signed by the president, it was paid for… continues to keep NFIP on the path of solvency, but it does so with compassionate rate management, which is extremely important. ... Now I know this law was signed this past Friday, but has FEMA begun to plan for the implementation of this law?"

In his response, Fugate testified: "We were looking at the language prior to the Senate actually taking it up, and we're looking at the timeframes you gave us to do refunds. Also, how to now change rate increases - I believe there's certainly language in there that they shall not exceed eighteen percent - so we are going back on that. You also have put in a fee structure so that fee structure will now have to go back to Write Your Own so that we set a point at which they will begin collecting that."

Palazzo also questioned how members of Congress could expedite the process, stating: "I just want to continue to urge you to act swiftly on this."

Fugate responded:

"I think probably it is important to educate them that these new grandfather rates are transferable; because it's going to take time to get that out there to every agent and get that into the system. So I think that you can help people and advocate that the law has changed and that if they aren't getting what they need, to work back with us. Because we may need to handle some of the immediate ones -- literally, hand-walk it through the process until the system is fully up and running with the new changes."

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