(This excerpt was originally published at Inside Sources)

Since September 2017, lawmakers had passed nine short-term extensions to the National Flood Insurance Program (NFIP), which covers more than 5.1 million flood policies throughout the country and provides vital assistance to disaster-stricken communities. On December 21, 2018, they did it again, voting to keep the program afloat until May 31, 2019.
Kicking the can down the road may be politically expedient, but Congress can’t put off fundamental reform of the NFIP forever. The NFIP’s financial condition continues to deteriorate with no end in sight; it owes $20.5 billion to the U.S. Treasury and its operating expenses outstrip its revenues from premiums by about $1.4 billion annually — and that’s assuming that no major disasters like Hurricane Katrina or Superstorm Sandy strike.
The program’s design flaws are well-documented, but Congress has not shown the will to do anything about them.
For example, as currently structured, the NFIP fails to create strong incentives for communities to take preventative steps — through better land use management, improved building codes, and other measures — to mitigate the financial costs of floods.
Top emergency management officials from both Republican and Democratic administrations agree that the NFIP — which embodies, in their words, “a deluge of damaging policy” — needs to be reformed to not only provide the funds to rebuild after storms, but the incentive to rebuild “smarter” in a way that makes future damage less likely.
…The NFIP’s current approach undercharges wealthy, coastal customers and overcharges lower-income homeowners, making policyholders with the fewest means subsidize those with the most expensive homes. Charging homeowners accurate, risk-based premiums would end this unfairness and improve the NFIP’s financial position.
Another major problem is that many of the flood maps the NFIP uses to set premiums and allocate resources are decades out of date. Some communities rely on maps created in the 1970s, and a recent Inspector General report found that only 42 percent of the NFIP’s maps “adequately identified the level of flood risk.” Flood mapping is currently controlled in Washington with no official input from local communities.
Lawmakers have until the end of May to debate meaningful reforms to the NFIP.

Since September 2017, lawmakers had passed nine short-term extensions to the National Flood Insurance Program (NFIP), which covers more than 5.1 million flood policies throughout the country and provides vital assistance to disaster-stricken communities. On December 21, 2018, they did it again, voting to keep the program afloat until May 31, 2019.

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