A perfect storm of economic factors is swirling around a dubious piece of legislation that threatens to inundate thousands of Manatee County homeowners with unaffordable flood insurance premium increases.
The ramifications of the Biggert-Waters Flood Insurance Reform Act of 2012 have grown so onerous even one of its name sponsors -- Rep. Maxine Waters, D-Calif. -- now rejects it as too damaging economically to homeowners and is working to have it repealed.
So, too, is Rep. Vern Buchanan, R-Sarasota, and Republican Gov. Rick Scott, who wrote a letter Sept. 17 calling for the rate increase to be delayed.
"I'm encouraged by the bipartisan spirit in which my colleagues on both sides of the aisle came together to address the devastating rate hikes and to find a long-term solution," said Buchanan, whose district has 30,000 affected properties. "This legislation will help bring affordable and accessible flood insurance back to Florida homeowners and businesses."
Scott released a statement Monday afternoon after key House and Senate members agreed to delay for at least four years National Flood Insurance Program changes that would cause serious flood insurance rate hikes for Floridians.
"The bipartisan deal announced in Washington today to combat flood insurance rate hikes on Floridians is a great step forward in our fight to undo these unfair increases," Scott said in the release. "This deal would delay the National Flood Insurance Program changes and require federal regulators to examine how these rate hikes will affect homeowners. I remain hopeful that President Obama will step in to support this or take any other action within the executive branch to undo these insurance rate hikes that hurt Florida families."
Biggert-Waters was passed in July 2012 to shore up the National Flood Insurance Program, which was forced to borrow nearly $18 billion from the U.S. Treasury to stay afloat after Hurricane Katrina and later found itself $25 billion in the red.
The idea behind Biggert-Waters was to create stability in the flood insurance market and bring subsidized homeowner rates closer to being actuarially sound, according to Buchanan's office. The maxium premium increase to result from Biggert-Waters was theoretically not to exceed $6,000 a year, according to Buchanan's office.
But the Federal Emergency Management Agency pushed for steep, rather than gradual, premium increases to make the system actuarially sound immediately. Projected premiums shot past the $6,000 cap to more than $25,000 in some cases and threatened to force thousands of Florida homeowners into foreclosure.
To make matters worse, FEMA was insistent premiums be paid in a lump sum rather than on a monthly basis, according to Buchanan's office.
Technology exacerbated the problem, too. New mapping can be done with greater precision, which placed some homes in flood zones where they had never been before. Homes once up to code no longer were in the newer flood maps, which meant another great expense, especially for homeowners who recently purchased property unaware it was in a flood zone.
Terry O'Connor, night metro editor, can be reached at 941-745-7040 or at firstname.lastname@example.org.