Norcross Joins Booker, Menendez, Pallone and Pascrell on Comprehensive Flood Insurance Program
WASHINGTON, DC – Today, U.S. Congressman Donald Norcross (NJ-01) joined Senators Bob Menendez and Senator Cory Booker (both D-NJ) and Congressmen Frank Pallone (NJ-06) and Bill Pascrell (NJ-09) on their comprehensive bipartisan legislation to extend the National Flood Insurance Program for five years while instituting a series of sweeping reforms to address the waste, abuse and mismanagement plaguing the system that led to delayed recovery for Superstorm Sandy survivors. The bill has the support of the entire New Jersey congressional delegation.
The National Flood Insurance Program Reauthorization and Reform (NFIP Re) Act of 2019 tackles systemic problems with flood insurance, puts it back on solid fiscal ground, and reframes the nation's entire disaster paradigm to one that focuses more on prevention and mitigation to spare the high cost of rebuilding after flood disasters.
More than five million American families, including more than 220,000 New Jerseyans, depend upon the NFIP, which Congress must reauthorize before it expires on Sept. 30, 2019.
"Under a month ago, South Jersey was hit with severe rain and flooding, and many families are still struggling to put their lives back together. These families and tens of thousands of others in New Jersey who rely upon the National Flood Insurance Program (NFIP) need us to take action and tackle systematic problems with the NFIP," said Congressman Norcross. "After Superstorm Sandy's devastation, there was unfortunately confusion and mismanagement – and it was painfully clear that commonsense, bipartisan solutions were needed. This bill will extend coverage and keep it affordable while strengthening resiliency and mitigation efforts that will help South Jerseyans, New Jerseyans and all Americans."
"We've witnessed the NFIP fail our constituents in their greatest hour of need and, after countless reauthorizations that simply kick a broken can down the road, we want real reform," Senator Menendez said. "With the National Flood Insurance Reauthorization and Reform Act of 2019, we can make the program more sustainable, more affordable, hold FEMA and private contractors accountable, and invest in the kind of forward-looking mitigation that reduces risk and prevents costly flooding in the first place."
"This legislation is an important and common sense approach to make flood insurance more affordable and extend coverage to communities who need it the most. Investing in the National Flood Insurance Program will ensure that New Jersey families are protected should disaster strike," Senator Booker said. "It's important that residents know there is a safety net that can not only help rebuild communities, but prevent and eliminate waste and mismanagement."
"My constituents know all too well that a fair flood insurance program is critical for rebuilding in the wake of destructive storms. After Superstorm Sandy, insurance companies outright refused to make good on their promises to policyholders and instead pointed to the fine print while denying families who had lost everything. New Jerysans deserve a long-term flood insurance program reauthorization that improves the program based on the realities of major weather events like Sandy," said Congressman Pallone. "This legislation will go a long way to strengthen our flood insurance program so that homeowners in my district are protected from the devastating effects of future flooding."
"I remember touring the devastation of Sandy like it was yesterday. Homes damaged. Businesses destroyed. The mold. The sand. The debris. I spoke with my constituents who saw their entire lives swept away in an instant. I vowed that day never to stop fighting for them," Congressman Pascrell said. "Our bipartisan, bicameral legislation will do a lot. Thanks to the hard work of Senator Menendez and Congressman Pallone, our bill helps people prepare prior to a storm with accurate maps and flood prevention investments. It strengthens the claims process so survivors get what they need to rebuild. It gives affordability safeguards to stop premiums from being jacked up. And it brings much-needed accountability to the Write Your Own program. We will be fighting hard to make sure we pass these changes into law. We owe it to Sandy victims."
The NFIP Re Act is being introduced in the Senate with broad, bipartisan support and original cosponsors: Bill Cassidy (R-LA), Senator Booker, Senator Menendez, John Kennedy (R-LA), Chris Van Hollen (D-MD), Marco Rubio (R-FL), Elizabeth Warren (D-MA), Kirsten Gillibrand (D-NY), and Jack Reed (D-RI).
Congressmen Pallone and Pascrell's companion legislation in the House is being cosponsored by 14 other Democrats and Republicans, including Congressman Norcross, Jeff Van Drew (NJ-02), Andy Kim (NJ-03), Chris Smith (NJ-04), Josh Gottheimer (NJ-05), Tom Malinowski (NJ-07), Albio Sires (NJ-08), Donald Payne, Jr. (NJ-10), Mikie Sherrill (NJ-11) and Bonnie Watson Coleman (NJ-12). Reps. Clay Higgins (LA-03), Debbie Mucarsel-Powell (FL-26), Charlie Crist (FL-13) and Stephanie Murphy (FL-07) are also cosponsoring the legislation.
"Flood insurance isn't a policy decision in our communities, it's one that's deeply personal to those still recovering from Superstorm Sandy in Ocean County and the recent floods in Burlington County," said Congressman Kim. "I'm proud to support this bipartisan effort that will strengthen the National Flood Insurance Program and put it on a path to better serve people in our community when the next storm hits."
"I've been able to see first-hand how essential the National Flood Insurance Program is to the hardworking people of New Jersey's Fifth District, not to mention our state's economy. Our flood-prone communities cannot continue to live in uncertainty when it comes to getting or affording flood insurance," said Congressman Gottheimer. "That's why I'm proud to stand with the entire New Jersey delegation to support this bipartisan legislation. Our homeowners deserve long-term certainty that expands coverage, improves mapping, and most importantly, lowers costs."
"New Jersians are all too familiar with extreme weather, damaging floods, and the problems associated with the National Flood Insurance Program," said Congressman Malinowski. "This bipartisan bill closes loopholes used to deny policyholders' claims and protects our state's residents from dramatic premium increases. We need more transparency, accountability, and fairness in the this program—our bill helps us get there."
"Our community knows the devastating impact of flooding to our homes and to our businesses. Wayne, New Jersey, has experienced some of the worst flooding in our state, and residents rely on the National Flood Insurance Program for financial protection," said Congresswoman Sherrill. "I am a proud co-sponsor of this crucial bipartisan legislation, which will provide New Jerseyans with a sense of certainty and security. As storms become more intense and more frequent, it is more important than ever to ensure that communities in New Jersey and across the country have access to flood insurance."
The NFIP Re Act of 2019 builds upon bipartisan, comprehensive reform legislation originally introduced in 2017 by Sen. Menendez, cosponsored by Sen. Booker and introduced in the House by Reps. Pallone and Pascrell. It addresses critical problems with the program, administered by the Federal Emergency Management Agency (FEMA), following Superstorm Sandy and other disasters: unsustainability, low participation rates, inaccurate flood maps, indifference to the benefits of flood control infrastructure, agency mismanagement, unsustainable debt service costs and contractor profiteering.
The National Flood Insurance Program Reauthorization and Reform (NFIP Re) Act of 2019
Long-Term Certainty. Reauthorizes the NFIP for five years, providing certainty for communities.
No Steep Rate Hikes under Risk Rating 2.0. Protects policyholders from exorbitant premium hikes by capping annual increases at 9%. Currently, premiums can more than double every 4 years or less and FEMA's new methodology called Risk Rating 2.0 will fundamentally alter premiums on every policy in the country. This untested and unknown methodology could cause a rate shock and lead to unaffordability premiums, forcing homeowners to drop coverage or lose their homes. We saw all too clearly the negative consequences of hiking premiums after the Biggert-Waters Act of 2012 caused costs to skyrocket, hurting policyholders and disrupting the real estate market. This will put guardrails on FEMA's new rating methodology, known as Risk Rating 2.0, and safeguard policyholders from sudden rate shocks.
Affordability for Low- and Middle-Income Policyholders. Provides a comprehensive means-tested voucher for millions of low- and middle-income homeowners and renters if their flood insurance premium causes their housing costs to exceed 30% of their Adjusted Gross Income, significantly increasing the affordability of the NFIP program.
Path to NFIP Solvency. Freezes interest payments on the NFIP debt and reinvests savings towards mitigation efforts to restore the program to solvency and reduce future borrowing
Limits on Private Insurance Company Profits. Caps Write Your Own (WYO) compensation at the rate FEMA pays to service its own policies and redirects the savings to pay for the means-tested affordability program.
Increased Cost of Compliance (ICC) Coverage. Increases the maximum limit for ICC coverage to better reflect the costs of rebuilding and implementing mitigation projects. In addition, ICC coverage eligibility is expanded in order to encourage more proactive mitigation before natural disasters strike.
Strong Investments in Mitigation. Provides robust funding levels for cost-effective investments in mitigation, which have a large return on investment and are the most effective way to reduce flood risk.
More Accurate Mapping. Authorizes funding for Light Detection and Ranging (LiDAR) technology for more accurate mapping of flood risk across the country, reducing confusion and generating better data.
Oversight of Write Your Own (WYO) Companies. Creates new oversight measures for insurance companies and vendors, and provides FEMA with greater authority to terminate contractors that have a track record of abuse.
Claims and Appeals Process Reforms Based on Lessons from Sandy. Fundamentally reforms the claims process based on lessons learned in Superstorm Sandy and other disasters, to level the playing field for policyholders during appeal or litigation, bans aggressive legal tactics preventing homeowners from filing legitimate claims, holds FEMA to strict deadlines so that homeowners get quick and fair payments, and ends FEMA's reliance on outside legal counsel from expensive for-profit entities.
Better Training. Provides for increased training and certification of agents and adjusters to reduce mistakes and improve the customer experience.
NFIP Re of 2019 has the support of leading flood experts and victims advocates, including:
"Senator Menendez has been in the flood recovery and insurance trenches with home and business owners for many years," said Amy Bach, Esq., Executive Director of United Policyholders. "His proposed legislation distills lessons learned into reforms that will restore confidence and integrity to this essential program."
"This is a bold bill that represents the policyholders interests not the special interest groups. The Jersey Shore is still trying to recover after Sandy," said George Kasimos, Founder of StopFEMANow. "Senator Menendez has always been in Sandy Survivors' corner. This bill shows Senator Menendez keeps fighting for all, not just Sandy Survivors, but all flood policyholders. From affordable premiums, to paying flood claims fairly, to re-mapping correctly, to raising ICC to $60,000, to mitigation funding to help prevent future flooding – this bill has it all."
"The NFIP-RE Act is vital to making the program work for policy holders and taxpayers. By making the program affordable for working families and funding mitigation, policy holders and tax payers will have a stronger program where no one is priced out of protection," said Krista Sperber, Co-founder of New Jersey Organizing Project. "And, every dollar invested in mitigation saves $4 - $6 dollars in disaster relief money - so it's a win for all of us. NFIP-RE takes critical measures to ensure flood insurance is fair to policy holders. Eliminating the bad actors responsible for fraudulent engineering reports and underpayment, granting policyholders the right to collect attorney and expert fees, and shifting lawsuits to the DOJ to defend are a giant leap forward in leveling the playing field so unscrupulous insurance companies and their contractors can not take advantage of disaster survivors on our dime."
"The NFIP reform and reauthorization bill being introduced by Senator Menendez has several strong proposals and is a good starting point for NFIP reform in the Senate," said Chad Berginnis, Executive Director of The Association of State Floodplain Managers. "The Association of State Floodplain Managers are especially pleased to see several very strong and innovative proposals relating to flood hazard mitigation including positive changes to Increased Cost of Compliance, a robust proposal to address repetitive loss properties, and an innovative low-interest mitigation loan program. Additionally, ASPFM is supportive of strengthening disclosure requirements regarding flood risks. ASFPM looks forward to working with Senator Menendez and other co-sponsors to address several pressing needs related to the NFIP going forward."
"This legislation would protect homeowners from the kind of abuses New Jerseyans saw after Superstorm Sandy," said Kevin Walsh, Executive Director of the Fair Share Housing Center. "The bill would help speed payments to homeowners trying to rebuild after a natural disaster, while also ensuring that they are fairly compensated and giving them avenues to appeal insurance company decisions. This proposal would also keep the Jersey Shore affordable to working families by limiting increases in homeowner insurance premiums."
"The NFIP reauthorization bill introduced by Senator Menendez speaks directly to the shortfalls of the NFIP post Sandy," said Melissa H. Luckman, Esq., Director of the Disaster Relief Clinic at Touro Law Center. "This bill will ensure that the fraud, deceit, and mismanagement of the NFIP faced after Sandy never happen again. Senator Menendez has been relentlessly advocating on behalf of all Sandy survivors since immediately post-Sandy through the Sandy Task Force, which forced FEMA to re-open all 144,000 NFIP insurance claims and to date has paid out over $208 million. This bill is the culmination of four-and-a-half years of spending countless hours listening to boots-on-the-ground constituent circumstances, and providing real and thorough reforms to ensure that policyholders have a voice and are protected in future flooding events. I completely support all of the protections afforded to homeowners in this bill."
"The American Policyholder Association strongly endorses the national flood insurance reauthorization act of 2019," said Doug Quinn, Executive Director of American Policyholder Association. "The bill has vital protections for consumers and taxpayers alike. We are particularly enthusiastic about the provisions allowing FEMA to ban individuals and companies involved in unethical conduct, as well as eliminating the fraudulent manipulation of engineering reports. This bill provides for a more stable and reliable NFIP while ensuring affordable premiums for American families. The APA urges passage of the National flood insurance reauthorization act of 2019."
"Very excited to see Sen. Menendez's legislation because it takes into account all of the hard-learned lessons from Sandy and implements changes that will directly benefit policyholders in the aftermath of a disaster and expedite recovery for both the individual as well as the community at large," said Susan Marticek, Executive Director, Ocean County Long-Term Recovery Group. "The pre-disaster aspects of this bill will go a long way to make our communities more resilient and save a tremendous amount of tax dollars in disaster recovery aid. The post-disaster reforms show the admirable degree to which Senator Menendez truly listened to the advocates and Sandy victims on the ground, carrying those lessons into his bill to ensure that disaster victims are at the center of FEMA's response and that the failures of the NFIP claims process following Sandy are not replicated in the future. We fully endorse this bill and need it now more than ever."
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Contact: Ally Kehoe, Communications Director
ally.kehoe@mail.house.gov