Flood Safe Basements Act

Madam President, I have come to the floor today to moderate a colloquy between my colleagues for the next 20 minutes or so regarding a very important amendment that has been filed to the Defense authorization bill we are considering. The colloquy will be between myself, Senator Wicker, Senator Warren, Senator Cochran, Senator Hoeven, Senator Nelson, and Senator Merkley. I ask unanimous consent that we have the next 20 minutes to conduct the colloquy.

Madam President, I really appreciate the courtesies of the manager of the bill on the floor, Senator Reed. I really appreciate his courtesies because those of us who have come to the floor today to speak about this issue are extremely concerned about this problem that has presented itself based on a bill that was passed 2 years ago called Biggert-Waters. With all the best intentions, a bill was passed 2 years ago to try to fix and reform and reauthorize the Nation's Flood Insurance Program, which is a very important program that allows millions of people who live not just along the coast but along our rivers and bayous and streams--from coast to coast, inland and coastal communities--to live safely and to live affordably and to have flood insurance they can count on. That was the intention of the bill, but something went awry through the passage of the bill, and the consequences are devastating.

Now, as we look back 2 years, and we see how FEMA and some of these Federal agencies are implementing the law we passed, we have some very serious concerns not only about how they are implementing it, but about the law itself.

So a group of us have come together to change that law so we can provide opportunities for our families, for our individuals and our businesses, to be able to buy and keep the kind of flood insurance they need to stay in business and to keep their communities intact.

In the last couple of weeks all we have heard about is health care insurance, and that is important, and we have some things to fix and move forward on, providing the country with a health care system they can depend on, but we also have a real challenge in flood insurance and affordability to our communities.

In Louisiana alone we have 400,000 flood insurance policies. Florida--I see my good friend, Senator Nelson from Florida, on the floor. His State has the largest number of policies; followed by Texas, with the second largest number; and, of course, Mississippi has quite a few as well. Senator Wicker joins me on the floor.

I want to start by showing this map I have in the Chamber so everyone who is following this debate--and there are literally millions of people following this debate; not only homeowners, business owners, but bankers, realtors, developers, et cetera--because if we do not get this right, these communities where you see these dots on the map, which are shown in the Mardi Gras colors--purple, gold, and green--these dots represent communities that are being affected by this program that needs to be changed and reformed.

These are flood maps that are being issued. Look how many there are in Oregon, Washington, California, Texas. What really surprised me-- because I know the gulf coast well; that is the area, of course, that I represent, Louisiana; and I know Texas and Mississippi and Florida very well--but the area that surprised me was Pennsylvania and Illinois and, of course, New York, New Jersey, and the east coast because of Superstorm Sandy. But this is a national issue. It is not a Louisiana issue. It is not a gulf coast issue. It is a national issue.

You will notice that these flood maps are not just along the coast. Some people say to us who are working on this: Well, I am not concerned because I do not represent a coastal State. Well, heads up, everyone. Even if you do not represent a coastal State, you are having flood maps issued from North Dakota, South Dakota, interior States, Kansas, Arkansas, et cetera, because you have rivers and flood zones.

If we do not change this bill in a significant way--what we are asking for in the Menendez-Isakson bill, which we are here offering as an amendment to the defense authorization bill--many of these communities will be devastated. That is because the Biggert-Waters bill has mandated fairly steep and unsustainable and unaffordable--to the middle class--rate increases that will simply prevent people from being able to stay in their homes.

My friend Senator Wicker is following me in this colloquy. He wants to speak specifically about the hardships that some of our people are experiencing as they are getting these notices about the rate increases. I ask Senator Wicker, what is he hearing in Mississippi? Could the Senator elaborate a minute about the unintended consequences of Biggert-Waters and the increases that some of our people are seeing in their primary homes as well as their businesses.

I thank the Senator from Mississippi for his comments and engaging in this exchange on the floor this morning.

The Senator from Florida has been particularly concerned because Florida has a very robust population as one of our largest States. I think the Senator has over 2 million policies in Florida.

Through the Chair, I wish to ask what the Senator is hearing in Florida about this situation.

I thank the Senator from Florida.

The Senator is correct about urgency. As the Presiding Officer knows, in her own home State, we are hearing from people who are stuck literally between a rock and a hard place because they can't get their insurance renewed. They can't afford the premium increases.

If they were thinking about selling their home, their home basically has become literally worthless, losing what equity they have-- temporarily we hope because we intend to fix this--because no one can purchase a home if the flood insurance went from $300 a year to $13,000 or $15,000 a year. It is affecting home ownership.

This is why I am proud to say--I see the Senator from Mississippi on the floor.

I wish to say how grateful I am to the great coalition of Senators who have come together, 24 Senators and 128 House Members. In addition, we have the National Association of Realtors, the National Association of Home Builders, and the Independent Community Bankers of America.

I wish to ask the Senator from Mississippi, through the Chair, does the Senator think we have a better chance of getting attention for our bill with the national strong support of the realtors, the homebuilders, and the bankers?

What is the Senator hearing from them in his State of Mississippi?

I thank the distinguished Senator from Mississippi. I appreciate his hard work as well as the staff. It has been a real team effort and without him we wouldn't be where we are today.

The Senator from Massachusetts is scheduled next in this colloquy. She has brought a particularly spectacular view, a different view, and a much needed view from the east coast, not only in light of the devastation from Hurricane Sandy but the ongoing challenges to that region.

I wish to ask unanimous consent, as it is 12:30 p.m., when we were supposed to end, if each of us takes 4 minutes in the order of Senator Warren, Senator Hoeven, and Senator Merkley, we could then recess for lunch as was required earlier.

What is the Senator hearing at home from the people of Massachusetts about this, and how important does she think it is for us to have the support of the realtors and the homebuilders and other national organizations that understand the dire consequences if we are not able to get some of these fixes in place?

Madam President, I thank the Senator so much.

Senator Hoeven has joined us, and he has been particularly forceful on the issue of basements in a State that doesn't have an ocean anywhere around it but has some serious flooding challenges. I would hope the Senator would take a minute to explain to everyone what he has been telling us and how important this particular piece of this bill is for the basement situation in his State.

Madam President, we have all been extremely helpful, of course, as a team in bringing this issue forward and crafting a bill, but literally we would not be here if it were not for the leadership of the subcommittee chairman who has jurisdiction over this issue--if he had not said yes when we asked him for a hearing in his committee to allow us to present the facts in hopes that we could find a way, as all of us have said, to make this program self-sustainable for the taxpayers but helpful to the people who need it. These are twin goals, both of which must be met or there won't be any program because no one will be able to afford to be in it. I thank the Senator for getting to that so quickly.

He is the last in our colloquy. Again, what is he hearing from home and can he give us, as chair of the subcommittee, some insight into how he thinks this will affect real estate markets if we are not able to fix this.

Our time has come to an end. In conclusion, I thank the Senator from Oregon again, the subcommittee chair, for his leadership. I also particularly thank Senator Menendez and Senator Isakson, the two lead sponsors of this bill, who have come together to provide the leadership to move this bill forward. They will be looking for a vehicle. We filed it on this bill in the event we have an opportunity for an amendment on the Defense bill. If not, we will be looking for the next possible opportunity.

I thank the Presiding Officer for her cosponsorship and her leadership for North Dakota.

This is a map of all the counties which have levees. I was surprised when I saw this map. I am very familiar with the levees in Louisiana. I helped to build a lot of them. I am very familiar with the Mississippi River generally because we have so much commerce along the Mississippi. I am generally familiar with Missouri, Illinois, and Arkansas. But what really

stood out for me was the levee systems in Montana, Arizona, and California. A lot of these are levees, dikes, and dams that are different from the river levees that we see. But look at Pittsburgh, New York, North Dakota, Montana, Washington. There is not a place in this country--not on the coast, not on the interior--that doesn't have a threat of flooding. Either a levee can break, a dam can break, a river can overflow, or there can be flash flooding because of droughts. Even in Texas where there is a lot of flash flooding. So not only on the coast, but inland as well, in Kansas.

The conclusion is this is a real challenge for our whole Nation. We have a bill led by Senator Menendez and Senator Isakson that costs and scores zero. We have written this bill in a way that just postpones these draconian rate increases so we can take a little more time to study it, do some modeling, and get it right. This bill was passed with very good intentions, but prematurely, without the data we need to make smart decisions for our communities. This is giving us time to get it right. There is zero cost the way this bill is structured.

Again, I appreciate the courtesies of our leader managing this bill on the floor.

I yield back the remainder of my time.

Madam President, we need to be moving forward with the Defense bill. It is very important. I am a member of Armed Services Committee, and we had a good bipartisan vote out of committee to bring the bill to the floor. Chairman Levin has been fair to us in committee, so we got a good committee process. But there are some disagreements over a number of issues that the full Senate needs to discuss and vote on. They just should be able to do that.

We are drifting into a process that is absolutely contrary to the history of the Senate--the real concept of the U.S. Senate--where we bring matters up and vote on them. Just because it cleared our committee does not mean the full Senate does not get to vote on some of these differing opinions.

I voted in the committee on a number of amendments that did not pass. We had amendments up in committee that we decided not to vote on, and the phrase was: Well, we will carry that to the floor. In other words, it will be brought up and the whole Senate will vote on it, not just the committee. Maybe in the interim something could be worked out. But if not, it would go to the full Senate, and the full Senate would work its will, would have its debate and vote.

We are going days now with nothing happening, no amendments being voted on. They could have already been voted on. So Senator Reid has filled the tree, and that means he has complete control over the process. He has the ability to say we will not have a single amendment. In fact, except for, I think, two, all he has agreed to in this process is to have maybe two amendments up, and that is unacceptable. Senator Reid ought to know that. You cannot move the Defense bill of the United States of America, spending $500 billion, and not have amendments and Senators actually offering suggestions on how to spend that money better and do better for America. What are we here for?

So I am really worried about this. I am afraid that this whole thing could collapse over the failure of amendments to be offered. I look here at a chart. Back, basically, when Republicans were in charge, we had 27 amendments, 25 amendments, 13 amendments actually voted on. The average number was 11.5 amendments voted on.

We already have well over 100 amendments filed. Over half of them, two-thirds of them, will eventually be withdrawn or the managers of the bill will agree to some form of that suggestion with different language and we would move on. But we should have already started on amendments, and we should recognize that a good Defense bill is going to require an open process where we can actually discuss how to fix it and make it better.

In addition, we are facing, under the Budget Control Act and the sequester, some real financial challenges for the Department of Defense that are historic. It is significant. We need to be able to talk about that and work on that and try to figure out a way to strengthen the ability of the Defense Department to function in a rational way and not do unnecessary damage to them while they work to contain spending. That is a critical thing.

So I would say to Senator Reid, who has a tough job--there is no doubt about that--Senator Reid, you should not attempt this dramatic reduction in the ability of the Senate to actually have amendments to a bill as large and as important as the Defense bill. You are overreaching, Senator Reid.

We cannot agree to that. The loyal opposition, the Republican opposition--I say, the bill that came out of committee was bipartisan, overwhelmingly bipartisan, with a big vote in the committee. But there are things that need to be voted on here, and we are not going to agree to a handful of amendments. So if you try to move forward with this bill without allowing at least a legitimate amendment process, you are not going to go forward because we are not going to agree to go forward when you fill the tree and block amendments and have the power to deny amendments of any significant degree on the floor of the Senate.

I am worried about that. I hope my friend, Senator Levin, and Senator

Reed, who is here, and others, can talk with the majority leader and reason with him, and let's get on with the business of proceeding with these amendments and some actual debate about the future of America's defense posture because we do have challenges in the years to come--a lot different than we have had--and we need to reconfigure defense, and we need to be asking ourselves honestly and in a bipartisan way, what will we need to do in 15 years, what will we need to be doing in 2025.

I had the honor to be at the Reagan Library this weekend for a national security conference dealing with what our defense structure should be in 2025. Senator Levin, along with former Secretary of Defense Gates, was given the first award they give for patriotic service. So our Armed Services chairman, let me note, was honored--our Democratic chairman--was honored at the Ronald Reagan Library for his commitment to national defense.

But I am just saying, ladies and gentlemen, in a bipartisan way we need to be thinking about what our future defense policy should be. We need to be thinking about how to move this bill. But it will not move, and I will not support going to a bill that does not allow this Senate to have a reasonable opportunity to have amendments.

I thank the Presiding Officer and yield the floor.

I thank my colleague from Louisiana for her tireless efforts in this regard. We can tell from the commentaries that have just been put forward from the Senator from Massachusetts, the Senator from Mississippi, the Senator from North Dakota, of course our colleague from Louisiana, and now representing Oregon, that these are folks representing blue States and red States and all types of different terrains, and they have the common purpose of addressing the dysfunction of the Biggert-Waters bill that was passed.

Just to give a small feeling for this, the Hay family from Eagle Creek, OR, wanted to sell their home. They had a nice young couple with solid financials who wanted to buy it. It was all approved except for the insurance policy. When the couple found out the insurance policy would not be the $500 the current family has been paying but $5,000 a year, the deal fell apart because for every $1,000 you pay in flood insurance, the value of the home drops by $20,000. So not only is the couple who wanted this home unable to buy it because of the home's value dropping, but the family who owned the home, who had equity in the home, and who hoped to take these funds into retirement to be their nest egg, has lost that nest egg due to these outrageous additional costs, these dramatic increases.

So the point of sale is one particular problem that has a big impact on the real estate market, but we also have the situation of someone who has a policy lapse. Maybe an individual thinks their mortgage company is paying the policy, the mortgage company thinks the owner is paying it, and it defaults for a few days. When everyone finds out no one has paid the bill, suddenly that family might be going, in that situation, from $500 to $5,000. Or perhaps the mortgage company has never enforced the provision requiring flood insurance and now they have checked their records--and they are checking their records because they are now being charged a significant multithousand-dollar fine if they do not check their records--and they find you should have flood insurance under the law but you don't, so they contact you. Well, now you are facing this unsubsidized rate as a new policy.

So we have all of this, and then layered on top of that is the fact that across the Nation the flood zones are being remapped. So folks who were outside of the 100 years and have been outside and have had their homes for 15 years are suddenly getting notified that they are inside the flood zone and required by their mortgage company to get a policy.

They may say: But wait, I looked at the map, and only the corner of my property is in the flood zone and my house isn't.

Well, the mortgage company says: We are sorry. You have to get this, and you have to then prove you are not in the flood zone.

It may cost those homeowners thousands of dollars to get an elevation survey and be able to demonstrate they are outside the flood zone. The homeowner carries this burden of proof.

So this is a big challenge, and we should recognize how uncertain and what an art form it is to establish these 100-year zones because a company comes in and does a model, and they say: Well, a 100-year flood will look like this, and they will point out what tributary, what watershed that contributes to the confluence of creeks is going to end up flooding that particular town.

Based on their model, the flood zone might look as though it is in the eastern section of the town or the western section of the town, and so on and so forth, that uncertainty where just inches can change whether you are inside a 100-year or outside a 100-year. Some of these areas are very flat. A few inches water rise can cover many additional square miles, and this can have a huge impact on our business districts, because what business wants to reinvest in a business district when now they feel that any improvements they make are going to be in an area where no one else is going to want to buy their company because they are in a situation where they have unaffordable flood insurance.

This is why we have come together--Democrats and Republicans, States from the North, South, East, and West coming together--to say we must change this situation which is creating so much unfairness and economic damage. I am delighted, as the chair of the subcommittee, to be fully engaged in partnering this. A special thanks to my colleague, the Senator from Louisiana, who is doing such a fine job of championing this issue.

Madam President, I thank my colleague from Louisiana for asking that question.

What I am hearing from Mississippi, and what I think we are going to be hearing from all across the United States of America, is that this is about to be a disaster for property owners in the United States of America. So I join my colleagues today--and perhaps there will be others besides the three of us on the floor--in saying we need to address the very real problem of increases in flood insurance premiums, which will unfairly hurt homeowners and businesses in my home State of Mississippi and across the United States of America.

I appreciate my colleague presenting the map to show that this is indeed a national problem and not just a regional or coastal problem. The severe onset of unaffordable rates--unaffordable rates--could have a devastating impact on the livelihood of homeowners and communities throughout the Nation and on our economy. Moreover, they could jeopardize the long-term solvency of the National Flood Insurance Program, which covers some 5.6 million Americans.

There is no doubt that NFIP faces enormous challenges. The damages wrought by storms such as Katrina, Rita, and Sandy have left the NFIP in the red for nearly a decade, amounting to nearly $24 billion at the last count.

In the early years of the NFIP, when bad storm years were roughly offset by light storm years, taxpayers effectively carried policyholders through years because of the NFIP's authority to borrow from the Treasury. However, the catastrophic 2004-2005 hurricane seasons put the program more than $20 billion in debt and disproved the notion that the finances would balance out over time.

The principles for NFIP reform are worthy goals. Premiums need to reflect risks more accurately, flood risks must be projected and mapped more accurately, and the purchase of flood insurance needs to be encouraged and enforced in order to enlarge the risk pool.

We cannot expect the NFIP to continue as a viable program without addressing the huge imbalance between premium revenue and payments for losses. At the same time, Congress cannot sit by in the face of these dramatic unaffordable rate increases facing many Americans.

The manner in which these reforms are being implemented is alienating the very people the program is intended to help. The new rates penalize people who have followed the rules, while placing the heaviest burden on those who are only now recovering from recent disasters.

In communities still recovering from recent Mississippi River flooding and in communities along the gulf coast, where the aftermath of Katrina still lingers, a financial burden of this magnitude could force homeowners either to leave their property unprotected or to move away altogether.

Ensuring the long-term success of the NFIP means taking an honest look at how the reforms Congress enacted last year are being implemented and whether they are unfairly hurting citizens--and I contend they are. Allowing rates to go from a few hundred dollars to tens of thousands of dollars is hardly a reasonable approach to reform.

Reform should not be unnecessarily painful, unfair, or counterproductive to the goal of solvency. Premium increases that make the coverage literally unaffordable could lead to a net loss in program revenue. Nobody benefits from that. Nobody benefits, neither the homeowner nor the taxpayer, when NFIP premium increases result in foreclosure.

I am concerned that NFIP may well have overestimated net revenue increases. They may have underestimated the burden of the program going forward. That alone would be a good reason to delay the increases, if a longer phase-in would result in a net increase in revenue to the program, as I suspect it would.

A delay would also allow time to study the effects of premium increases and it would allow us, as policymakers, to look for less harmful approaches to reform. The Federal Emergency Management Agency should be able to complete an affordability study and ensure that its technologies and methodologies accurately assess risk.

I thank my colleague from Louisiana and I thank my colleague from Florida for joining us. I urge all of my colleagues to support action that provides immediate relief to Americans facing these steep rate hikes.

I thank the Senator from Louisiana for the question, but most of all I thank her for her energetic leadership on this issue; she will help us find the right way forward.

I am here today because of what I am hearing from families in Massachusetts. I also thank the Senator from Mississippi. This is something that is hitting us all around the country--this change in the flood maps. So I am here today to support my colleagues' bipartisan efforts to help homeowners across the country who are getting hit with newly revised flood maps and increased flood insurance premiums.

Families purchase flood insurance to prevent the loss of their homes during a natural disaster, but now many of these same families fear that the price of flood insurance could be just as devastating and could actually cost them their homes.

I understand why Congress changed the national flood program to more accurately reflect the true costs and risks of flood damage, and I agree that over time we need to move to a more market-based system for setting flood insurance rates, providing we adequately take into account the affordability concerns for working families. But that is not what is happening right now. These new maps and rate increases are having as big an impact as a big storm.

When FEMA released these flood maps earlier this year and last, they knew they were placing hundreds of thousands of homeowners into a flood zone for the very first time. Yet there was inadequate warning to homeowners. Many have started receiving letters from their mortgage companies and are learning for the first time that they must now purchase flood insurance. We have heard about the costs--$500, $1,000 a month, even more. Most hard-working families and most seniors don't have that kind of extra money on hand to spend on flood insurance premiums they never knew they needed.

One Massachusetts resident wrote to me and said:

I have owned my property for over 33 years. Twelve years

ago I built a house according to the codes at the time.

Recently, flood maps were redrawn, putting my home in a new

flood zone and out of compliance. The implementation of the

Biggert-Waters act is going to raise our flood insurance to

$10,000 or more per year. I follow the rules, and now the

rules are changing, leaving me few options to comply.

The Homeowner Flood Insurance Affordability Act that I have cosponsored along with Senator Landrieu and so many others will provide relief to this homeowner and to others who built to code and were later remapped into a higher risk area. This critical bill will delay rate increases until FEMA completes affordability studies mandated by the Biggert-Waters Flood Insurance Reform Act and until subsequent affordability guidelines are enacted.

There is a second problem with FEMA's actions. The reclassifications have taken place in some areas without a careful and complete analysis, but for those who believe they haven't been correctly classified, it is a tough challenge to get their flood zone status changed.

I received another letter from a Massachusetts constituent who lives in Brockton. She was informed that her only way out of this mess was to pay more than $1,000 for an engineer to come and conduct an elevation study of a nearby brook. Now, let's be clear. She had to spend this money even though the city of Brockton and the nearby Army Corps of Engineers have no record of the brook ever flooding. If her appeal is successful, she is still out $1,000 due to FEMA's mistake.

Then I will just say I am pleased to join my colleagues on both sides of the aisle in calling for this commonsense delay which will give FEMA time to get this right. I thank Senator Landrieu for her leadership, and I thank Senators Menendez, Isakson, Cochran, and all the cosponsors of this bill. Time is running out. We need to get this done.

I yield back.