2014 -- H 7284

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LC003968

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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H O U S E   R E S O L U T I O N

RESPECTFULLY REQUESTING THE UNITED STATES CONGRESS TO PASS THE

HOMEOWNERS FLOOD INSURANCE AFFORDABILITY ACT

     

     Introduced By: Representatives Kennedy, Walsh, Azzinaro, Lally, Tanzi, and Ruggiero

     Date Introduced: January 30, 2014

     Referred To: House Corporations

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     WHEREAS, The National Flood Insurance Act of 1968 was enacted to provide

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previously unavailable flood insurance protection to property owners; and

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     WHEREAS, The National Flood Insurance Program continues to provide important and

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necessary property coverage for home and business owners throughout parishes, counties, and

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communities nationwide; and

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     WHEREAS, The Biggert-Waters Flood Insurance Reform Act of 2012 was signed into

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law on July 6, 2012, and calls for a revision of the flood insurance rate maps; and

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     WHEREAS, The intent of the Biggert-Waters Flood Insurance Reform Act of 2012 was

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to relieve taxpayers from the recurring need to fund the National Flood Insurance Program

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through both pre-event premiums and post-event debt; and

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     WHEREAS, The Biggert-Waters Flood Insurance Reform Act of 2012 calls for an

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evaluation of the use of private reinsurance to protect against catastrophic losses and to stabilize

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the National Flood Insurance Program's results and financial position; and

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     WHEREAS, Such revised flood insurance rate maps do not include the discounts granted

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by the current rate maps to property owners who have taken action to mitigate property damage

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by installing and maintaining flood control features, in conformity with the most current federal

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law available to them, and in conformity with current flood insurance rate maps; and

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     WHEREAS, Countless property owners have built and purchased homes and businesses

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in accordance with the current flood rate insurance maps which, under the provisions of the

 

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Biggert-Waters Flood Insurance Reform Act of 2012, will soon enter obsolescence; and

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     WHEREAS, The act also includes provisions, located in Section 207 of such act, that

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eliminate the "grandfathering" of homes that were built after the existing flood insurance rate

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maps in accordance with then existing laws; and

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     WHEREAS, By purchasing homes and businesses in accordance with the provisions of

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the former flood rate insurance maps and by investing in previously owned property to install

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flood mitigation features, property owners relied on their strict compliance with federal and state

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law to protect their purchases and investments; and

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     WHEREAS, In light of the provisions of the Biggert-Waters Flood Insurance Reform Act

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of 2012, the reliance on existing flood insurance rate maps that those property owners

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demonstrated is now to their personal and financial detriment; and

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     WHEREAS, The passage of the Biggert-Waters Flood Insurance Reform Act of 2012

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substantially and immediately devalued the investments made in all properties endowed with

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flood damage mitigation measures and to properties receiving subsidized insurance premium

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rates; and

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     WHEREAS, The Biggert-Waters Flood Insurance Reform Act of 2012 also includes

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provisions that permit the National Flood Insurance Program to increase premium rates for many

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policyholders; and

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     WHEREAS, The elimination of these discounts combined with the certainty of general

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premium rate increases will result in a premium increase of up to twenty-five percent per year for

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certain property owners over the next four years; and

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     WHEREAS, Under the changes to the National Flood Insurance Program caused by the

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Biggert-Waters Flood Insurance Reform Act of 2012, certain property owners will struggle to pay

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exorbitant amounts of money or will lose their flood insurance; and

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     WHEREAS, A change in the ability of property owners to insure their homes from flood

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damage without bearing the burden of such a violent rise in cost may lead to financial distress for

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residents and property owners around this nation; and

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     WHEREAS, The premium increases to the National Flood Insurance Program, as

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mandated by the Biggert-Waters Flood Insurance Reform Act of 2012, will affect the entire

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nation's real estate market and the nation's banking and mortgage industry; and

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     WHEREAS, The premium increases to communities and property owners who made

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their best efforts to comply with federal law by building property in accordance with soon to be

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outdated flood insurance rate maps will affect consumer confidence and the entire nation's

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economy; and

 

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     WHEREAS, On October 29, 2013, H.R. 3370 and SB 1610, the Homeowner Flood

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Insurance Affordability Act of 2013, were introduced in the respective houses of Congress to

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delay the implementation of certain provisions of the Biggert-Waters Flood Insurance Reform

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Act of 2012; and

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     WHEREAS, The Biggert-Waters Flood Insurance Reform Act of 2012 provides that an

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affordability study be conducted by the Federal Emergency Management Agency on the impact

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of rate increases, which study has not been conducted; and

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     WHEREAS, The Federal Emergency Management Agency is currently undertaking a

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flood risk insurance study that will entail, among other things, the development of a flood

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catastrophe model to enable financial analysis of the National Flood Insurance Program and a

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study of the availability and benefits of risk transfer through the use of private reinsurance; and

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     WHEREAS, The United States Congress should consider passage of the Homeowner

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Flood Insurance Affordability Act of 2013 that would delay the provisions of the Biggert-Waters

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Flood Insurance Reform Act of 2012 that provide for the increase of premium fees for

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policyholders of the National Flood Insurance Program, in order to prevent the unduly hazardous

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effects it will have on home and business owners who invested in property prior to the adoption

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of the new federal legislation and flood insurance rate maps; now, therefore be it

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     RESOLVED, That this House of Representatives hereby respectfully supports and urges

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the United States Congress to pass the Homeowners Flood Insurance Affordability Act currently

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pending before Congress as H.R. 3370 and SB 1610, which will delay the implementation of the

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National Flood Insurance Program changes until two years after the Federal Emergency

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Management Agency completes the affordability study on the impact of the rate increases; and be

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it further

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     RESOLVED, That this House hereby supports and urges the United States Congress and

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the Federal Emergency Management Agency to actively and expeditiously explore the use of

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private reinsurance to protect against catastrophic losses and to stabilize the National Flood

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Insurance Program's results and financial position; and be it further

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     RESOLVED, That the Secretary of State be and hereby is authorized and directed to

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transmit duly certified copies of this resolution to Rhode Island's Congressional Delegation, and

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to the Administrator of the Federal Emergency Management Agency.

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