Congressman Tom MacArthur in Middle of Effort to Reform NFIP

Jun 28, 2017

The U.S. House of Representatives is far ahead of the U.S. Senate when it comes to reforming and reauthorizing the National Flood Insurance Program. Last week The SandPaper reported that eight senators from coastal states, including New Jersey Democrats Bob Menendez and Cory Booker, had introduced “comprehensive, bipartisan legislation to extend the NFIP for six years while instituting modifications to address the system’s faults.” Note they had “introduced” legislation.

But in the past two weeks, the House Financial Services Committee advanced a package of seven NFIP-related bills, moving them through the committee so the entire House may consider them. That is significant in that Congress as a whole must reauthorize the NFIP before it expires on Sept. 30. Considering both chambers will be on recess for the first nine days of July and the entire month of August, the clock is clearly ticking.

Moving legislation through committee is time-consuming, especially in the Senate, which is currently tied up in knots dealing with healthcare. The bill cosponsored by Menendez, Booker and others must move through the Senate Banking Committee before the entire Senate can consider it.

N.J. Rep. Tom MacArthur, whose 3rd Congressional District includes the western half of Stafford Township and the entirety of Barnegat Township, is a member of the House Financial Services Committee. He’s been in the thick of many things of late. It was his amendment that was credited with getting GOP legislation to repeal and replace Obamacare passed by the House, and on Tuesday afternoon – too late for this edition of The SandPaper – the 85-member House Bipartisan Heroin Task Force, of which MacArthur is a co-chairman, was expected to announce its legislative agenda for the 115th Congress. So it isn’t surprising MacArthur is heavily involved with the NFIP legislation, especially since flood insurance is such an important issue in his district.

“Nearly five years ago,” he wrote, “Superstorm Sandy devastated the Jersey Shore and forever changed its landscape. Ocean County – my home – was the epicenter of the storm and half of all NJ Sandy flood claims happened here. An estimated 346,000 homes were damaged or destroyed, resulting in over $30 billion in losses.

“Worse, thousands of those families are still not back in their homes, and countless businesses were forced to shutter for good. Lack of leadership from politicians and mismanagement and malfeasance by bureaucrats at FEMA are largely to blame. The terrible response to this storm coupled with an opportunity to reauthorize and reform the National Flood Insurance Program (NFIP) are two big reasons why I sought a seat on the House Financial Services Committee during this Congress.”

MacArthur, along with his wife, Debbie, owns a home in Barnegat Light, so they personally witnessed the suffering of neighbors after Sandy. He wasn’t yet a member of Congress at that time, but the couple created the St. Peter’s Sandy Relief Fund through their church and opened their own home to local families who had lost theirs.

But many members of Congress have never experienced a hurricane, which, after all, was what Superstorm Sandy technically was until just a few minutes before slamming into the Jersey Shore. So they don’t think much of the NFIP.

“After joining the House Financial Services Committee, I was confronted with the harsh reality that many of my non-coastal colleagues wanted to gut the NFIP and put it on the path to extinction. They’ve called the program ‘unfair,’ ‘unneeded,’ and a ‘middle-income entitlement.’ With all due respect, they could not be more wrong.

“No, the NFIP is not perfect, but our goal should be reforming the program so it works better, not getting rid of it entirely and leaving people in coastal communities exposed. A lapse in the program would have devastating consequences for Ocean County homeowners and the local economy, effectively shutting down the local housing market and negatively impacting homebuilders, realtors, community banks, and tax paying consumers. My goal has been to achieve a long-term reauthorization and reform the program so it serves flood-exposed citizens and coastal communities better.”

MacArthur said he fought within the committee to ensure that “every coastal resident and business has access to the flood program at affordable rates, to increase investment in mitigation and to instill more accountability at the Federal Emergency Management Agency (FEMA).” He further said he had been able to win “numerous concessions that will help Jersey Shore residents.”

His victories include:

• fully reauthorizing the program for five years.

• amending the bill so that all flood-exposed properties in participating communities will be able to participate in the program. The original bill excluded new construction in special flood hazard areas.

• limiting premium increases for homes that were built before flood maps were produced by the federal government. He added he’ll continue to attempt to lower such rates even more before a floor vote.

• removing a provision that would have slapped homeowners who had suffered two losses with a minimum of $1,000 with a $5,000 deductible. Instead a deductible will apply only to severe and extremely repetitive loss properties.

• prohibiting FEMA from hiring disbarred attorneys, a practice MacArthur claims was rampant during the Sandy claims review process. “People who are not qualified to practice law should not be hired to settle claims.”

• doubling the Increased Cost of Compliance coverage from $30,000 to $60,000 to help residents elevate their homes and engage other strategies to protect against further flood risk. The bill also authorizes the NFIP to pay ICC coverage in advance of a loss.

• ensuring that FEMA “can’t wantonly punish communities who are acting in good faith with federal funding they receive to mitigate flood risk. Without this provision, FEMA could impose unfunded mandates on local mayors of flood-exposed communities.”

“As I have explained to my colleagues in Congress and on the Financial Services Committee, the people whose lives were turned upside down by Sandy aren’t millionaires and billionaires. To the contrary, my constituents living in towns like Toms River, Berkeley, Brick and Seaside Heights are working class people whose modest homes (most well under 1,000 square feet in size) were handed down by their parents or grandparents who built them in the 1960s. They pay their taxes and expect their government to be there when a natural disaster strikes.”

The NFIP is drowning in debt, in the red to the tune of almost $25 billion because of the double whacks of 2005’s Hurricane Katrina and 2012’s Sandy. The NFIP had been self-funding before 2005, the most active Atlantic hurricane season in recorded history.

— Rick Mellerup

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