WASHINGTON A bipartisan coalition of lawmakers in the House and Senate has forged a deal to delay flood insurance premium increases that went into effect earlier this month.
The Homeowner Flood Insurance Affordability Act includes an agreement to delay premium increases for about four years, by pushing back the implementation date until after the Federal Emergency Management Agency conducts a mandated affordability study and proposes an affordability framework to be vetted by Congress.
Bankers and other observers in coastal and flood-prone areas had raised dire warnings about the effect of the cost increases on borrowers' ability to pay their mortgages and the potential impact on the broader housing market. Concerns arose after the passage of the Biggert-Waters Flood Insurance Reform Act last year, which was designed to shore up the finances of the national flood insurance program by phasing out certain subsidies to homeowners, but which ultimately sparked outcry.
"This legislation would ensure FEMA undertakes program changes in a way that will not cause harm, by delaying implementation until it provides Congress the facts on how rate increases will affect homeowner," said Rep. Maxine Waters, D-Calif., one of the bill's sponsors. "It will also give us the information we need to go through the program piece-by-piece and fix any outstanding affordability issues."
The legislation was introduced Tuesday by Waters, along with Reps. Michael Grimm, R-N.Y., and Cedric Richmond, D-La., in the House, and Sens. Robert Menendez, D-N.J., and Johnny Isakson, R-Ga., in the Senate. It's co-sponsored by another 53 congressmen and 13 senators.