In D.C. meeting with Obama, Gov. Rick Scott calls for flood insurance solution

Article Courtesy of The Miami Herald

By Alex Leary

Published March 2, 2014


WASHINGTON -- Florida Gov. Rick Scott, who has been trying to raise his profile on the burning issue of flood insurance, got a prime opportunity Monday in a meeting with President Barack Obama.

Flood insurance rates have sharply increased for many Floridians because of a 2012 law that some members of Congress are now trying to reverse. But Scott, a Republican running for re-election, has for weeks tried to pin blame and responsibility on Obama.

“We’ve been asking the president to use his pen and stop these unreasonable, unfair increases,” Scott told reporters on a windy street corner a few blocks from the White House after a large group of governors met with the president. 

Obama, Scott said, replied that he expects a bill to pass Congress, which returns to the issue this week.

“There’s a lot of talk in Washington; there’s not enough action,” Scott told reporters. “They’ve been talking about this for months. They haven’t passed anything.”

Scott’s call for Obama to use executive action comes as Republicans have blistered the president for acting alone in other areas and injects fresh partisanship into an issue that has bipartisan support on Capitol Hill.

The 2012 legislation, known as Biggert-Waters, was intended to phase out subsidized rates to reflect true risk. Starting Oct. 1, it began phasing out over five years subsidies for owners of homes built before the flood map program began. Buyers of homes sold after July 2012 lose the subsidy immediately.

But with some homeowners seeing annual increases of $2,000 to $10,000, lawmakers are rushing to undo their actions and trying to blame FEMA for moving ahead too soon.

Scott’s spokeswoman noted that he has also talked with House Speaker John Boehner but insisted Obama can act more urgently to stop FEMA from implementing changes driving the higher rates, which have caused anger and panic in Florida, Louisiana, New York, New Jersey and other states. The White House in a statement said the president looked forward to continuing to work with Congress on legislation and that he does not have the authority to unilaterally change rates.

The Senate last month passed a bill delaying major changes for four years. It met resistance in the House, where Republican leaders said it failed to address the insolvency of the National Flood Insurance Program.

This week, Republicans plan to make the case for their own version, which calls for a $25 annual assessment on primary residence policies covered by the NFIP, and about $250 for businesses and secondary residences — money that would go into a reserve fund.

The bill eliminates a provision of that 2012 law that said subsidized rates disappear when a person sells a primary home, which has stymied the real estate market. But going forward, rates could still rise by an average of 15 percent a year.

It also reinstates grandfathered flood insurance rates that would go away under new FEMA flood maps, provides a refund for people who purchased a home since 2012 and had to pay higher rates and calls on FEMA to complete within two years a study on the affordability of phasing in more actuarially sound insurance premiums.

Some interest groups that wanted the House to take a more conservative approach said they were disappointed.

“Less than two years after passing landmark reforms to fix the NFIP, which remains $25 billion in debt to American taxpayers, lawmakers appear poised to gut just about all of those reforms, all to score cheap political points,” said R.J. Lehmann of R Street Institute, a free-market group. (Private insurers say they cannot compete with government-subsidized rates.)

Rep. Maxine Waters, a California Democrat who authored the 2012 law and was a chief sponsor of the previously introduced House bill, also said she was concerned that as written it may not guarantee the affordability of flood insurance for many policyholders.

Though House Republicans may seek a vote as early as this week, Waters in a news release on Monday said, “No deal yet.”

During the meeting with Obama, Scott also criticized newly announced cuts to Medicare Advantage and called for sanctions against Venezuela.

Obama praised governors who chose to expand Medicaid. A year ago, Scott expressed support for accepting billions in federal funding but never followed through with state lawmakers.

“You’ve got Republican governors here — I won’t name them in front of the press, because I don’t want to get you all in trouble — who have chosen to cover more people through new options under Medicaid,” Obama said. “And as a result, millions of people are going to get help.”