Congress Increases National Flood Insurance Program’s Borrowing Authority
Hurricane Recovery
Memo to Members: Vol 11, No. 7, February 17, 2006
The White House has received for signing a bill that would increase the borrowing authority of the National Flood Insurance Program to $20.8 billion dollars. This is the third increase to the program’s borrowing authority since Hurricane Katrina. Prior to September 2005, the NFIP’s borrowing authority stood at $1.5 billion.
Senate Banking, Housing and Urban Affairs Committee Chair Richard Shelby (R-AL) introduced S. 2275 on February 10. The bill passed the Senate floor, by unanimous consent, the same day. Senator Shelby’s bill would have increased the borrowing authority by $2.7 billion, to $21.2 billion. House conservative Republicans, however, insisted on increasing the authority by only $2.3 billion, and said they will vote for further increases to the borrowing authority only if the requested increase is tied to programmatic restructuring proposals.
Congress will likely have to vote in the spring to again increase the borrowing authority of the NFIP, due to the unprecedented number of claims made in the 2005 hurricane season. “I predict we will be back here in 60 to 90 days to raise the limit again,” said Representative Bob Ney (R-OH), chair of the House Financial Services Subcommittee on Housing and Community Opportunity.
Senator Shelby has held a series of hearings on reforming the National Flood Insurance Program (see Memo, 1/27 and 2/3), and has said that reform legislation is a 2006 priority for the Senate Banking Committee.
