House votes to expand borrowing authority for Sandy flood claims
Responding to the insurance claims of property owners hit by last October’s super-storm Sandy, the House voted Friday to approve $9.7 billion in additional borrowing authority for the National Flood Insurance Program (NFIP) which covers property owners in flood-prone areas.
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Elected officials in New York, New Jersey and Connecticut had assailed House Speaker John Boehner for not allowing a vote Tuesday night on additional funding for people affected by last October’s storm. Friday’s vote was a prelude to another vote on Jan. 15 to make additional outlays to cities, towns and property owners affected by the storm.
Rep. Peter King, R-N.Y., blasts Speaker John Boehner and Congress for delaying action on a bill that would provide aid toward Hurricane Sandy relief efforts
The Federal Emergency Management Agency notified Congress Wednesday that additional borrowing authority was needed -- otherwise NFIP funds available to pay claims would be exhausted next week.
FEMA said that to date nearly 140,000 NFIP claims have been made and $1.7 billion has been paid to people affected by Sandy.
The flood insurance program collects premiums from the insured, but borrows money from the Treasury when premiums are insufficient to pay claims. The funds must be repaid with interest.
Seth Wenig / AP
Homes and docks damaged by Superstorm Sandy remain uninhabitable in the Broad Channel section of Queens, New York, Thursday, Jan. 3, 2013.
“The victims of super-storm Sandy can wait no longer. It’s been 11 weeks. Haven’t they suffered and waited long enough?” asked Rep. Carolyn Maloney, D-N.Y. during Friday’s debate. She said people in New York “are screaming for assistance.” She said many people in her state are “shivering tonight in the cold of New York where temperatures are again below freezing. They are in homeless shelters and hotels, with friends, they are waiting. This body needs to act and needs to act today.”
But Rep. Scott Garrett, R-N.J., noted that “the people in the area have not been waiting; their (NFIP) claims have been paid from Day One. We are just here today to ensure that those payments continue.”
House Financial Services Committee chairman Rep. Jeb Hensarling, R-Texas, said during the debate Friday, “There’s no doubt that Hurricane Sandy rendered unspeakable damage to both lives and property on our East Coast. It represents truly one of the great natural disasters of recent history.”
He said, “For the victims who paid for flood insurance policies with the National Flood Insurance Program, their claims need to be paid – and paid now.”
But he added the NFIB “is beyond broke – it is taxpayer-bailout broke.”
He called for reforms to the program to ensure that “taxpayer bailouts are never needed again” and to get NFIP “on a path towards actuarial soundness.” But despite some reforms enacted last year, Hensarling said, “Sandy has hit before many of these provisions could take effect.”
He said his committee would take up a bill this year “to transition to a private innovative, competitive, sustainable flood insurance market.”