House Amendment to S. 1182, National Flood Insurance Program Extension Act of 2018
On Tuesday, July 24, 2018, the House will consider the House Amendment to S. 1182, the National Flood Insurance Program Extension Act of 2018, under suspension of the rules. The original bill was introduced on May 18, 2017 by Sen. Todd Young (R-IN) as the American Legion 100th Anniversary Commemorative Coin Act and was referred to the Senate Committee on Banking, Housing, and Urban Affairs. The bill passed the Committee with an amendment by voice vote and the Senate by unanimous consent on August 8, 2017. The House passed the companion legislation, H.R. 2519, and the Senate passed the House version.
The House Amendment to S. 1182 extends the National Flood Insurance Program, which is set to expire July 31, 2018, through November 30, 2018. This amendment does not include any reforms to the program; it is only a short-term extension.
The National Flood Insurance Program (NFIP) aims to reduce the impact of flooding on private and public structures. The program provides affordable insurance to property owners, renters, and businesses and encourages communities to adopt and enforce floodplain management regulations. According to the Federal Emergency Management Agency (FEMA), the agency responsible for administering the NFIP, these efforts help mitigate the effects of flooding on new and improved structures.
The taxpayer-backed and government-run National Flood Insurance Program was created in 1968 and is virtually the only source of flood insurance for millions of households in the United States. Approximately 50 years later, the federal program not only has a monopoly, but has borrowed over $30 billion from taxpayers, operates a $1.4 billion annual deficit, and lacks the innovation expected of a company with $1.2 trillion of insurance coverage. The NFIP’s 5 million policies represent 4% of U.S. households at an annual average cost of $884. Over 94% of NFIP residential policyholders paid less than $2,000 in annual premiums for NFIP coverage.
The NFIP was originally set to expire on September 30, 2017. On September 8, 2017, Congress passed a short-term extension set to expire on December 8, 2017.
Recognizing the program is broken and in need of repair, Congressman Sean Duffy (R-WI) introduced the 21st Century Flood Reform Act (H.R. 2874), a collection of seven bills approved by the House Financial Services Committee that would reauthorize the NFIP for five years, introduce private market competition, and provide programmatic reforms to help policyholders.
In the wake of massive storms, including hurricanes Harvey, Irma, and Maria, on November 14, 2017, the House overcame its points of contention and passed the 21st Century Flood Reform Act. The Senate, however, did not act on this legislation.
As a result, on December 8, 2017, the NFIP received a second short-term extension through December 22, 2017 and a third short-term extension through January 19, 2018. The NFIP lapsed between January 20, 2018 and January 22, 2018, but received a fourth short-term reauthorization through February 8, 2018. The NFIP lapsed for approximately eight hours during a brief government shut-down in the early morning of February 9, 2018. However, the NFIP received an extension in the omnibus spending bill through July 31, 2018.
With the July deadline approaching, on June 28, 2018, the U.S. Senate approved its version of the farm bill, which includes an amendment that would extend the authorization of the NFIP for six months. The House opposes a six-month extension because it would leave the fate of the program up to the 116th Congress. The House Amendment to S. 1182 only extends the program until November 30, 2018, maximizing pressure on Congress to enact a permanent solution that makes necessary reforms and provides certainty for insurance providers and housing markets.
A Congressional Budget Office estimate is not currently available.
For questions or further information please contact Ashley Gutwein with the House Republican Policy Committee by email or at 2-1374.
 National Flood Insurance Program, Federal Emergency Management Agency, https://www.fema.gov/national-flood-insurance-program.