WASHINGTON — The National Flood Insurance Program received a temporary reprieve on Thursday, just one day before it was set to expire and after two previous attempts were thwarted.
The program, which has been strung together by a seemingly never-ending series of stopgap measures for nearly two years, has been extended for two weeks. When lawmakers return from recess on Monday, the U.S. House is expected to pass yet another temporary extension — the NFIP’s 12th in two years — to keep the program afloat through the end of September while a bipartisan group of lawmakers work on a long-term plan.
The most recent NFIP extension had been held in legislative limbo for the past week, caught up in a partisan fight over an unrelated issue as its midnight Friday expiration loomed.
NFIP covers 5 million policyholders in flood-prone areas, including half a million in Louisiana alone.
The September extension already has won broad bipartisan support in both the U.S. House and Senate, but the legislation had not made it past the finish line before lawmakers headed back to their districts for this week’s recess.
Under House procedures allowed during the recess period, the NFIP could be extended only if no member voiced an objection. House Republicans raised objections on Friday and again on Tuesday because of broader disagreements with Democratic leadership over the handling of a bipartisan $19 billion disaster recovery aid package.
On Thursday, freshman Republican U.S. Rep. John Rose of Tennessee allowed the two-week NFIP safety net proposal to pass through to President Donald Trump, but again blocked the $19 billion disaster aid package that also contains the September extension for NFIP.
The disaster aid bill is expected to pass the Democrat-controlled House when members return from the break on Monday.
“The NFIP is a safety net for millions of Americans, and we could not afford to let it lapse,” U.S. Sen. John Kennedy, R-Madisonville, said after the NFIP extension cleared the House on its third attempt. “This is another short-term fix, but it buys us two weeks to keep the program functioning until we can pass a longer extension."
"We need to pass the disaster supplemental package as soon as possible to ensure the NFIP’s viability as we enter hurricane season," he added.
U.S. House Minority Whip Steve Scalise, a Jefferson Republican, was in Louisiana visiting the State Capitol when the NFIP reauthorization passed and announced it from the Senate floor.
"We don’t want to see the flood insurance program lapse. It was about to," he said. "That’s why it was so important that we got the short-term extension."
Scalise, who is the longest-serving of the Louisiana delegation and No. 2 ranking House Republican, has suggested that a five-year extension could be worked out in the coming months to provide more stability to the program.
"Look, you see all around the country, Oklahoma and Arkansas are seeing massive floods right now," he said. "It seems to touch every part of the country. It’s a program that’s real important not just to Louisiana but families all across the nation."
If the extension had not gone through, the federal government would have been blocked from issuing new flood insurance contracts until it was reinstated, effectively preventing some real estate transactions.
According to an analysis from the independent Congressional Research Service, “in past NFIP lapses, borrowers were not able to obtain flood insurance to close, renew, or increase loans secured by property in a (Special Flood Hazard Area) until the NFIP was reauthorized.”
The NFIP's last long-term authorization expired on Sept. 30, 2017, as the effort for another long-term extension has faced resistance among lawmakers who question its costs and efficiency.
The Government Accountability Office has included the NFIP on its "high risk list" because it hasn’t struck a sustainable balance between keeping insurance affordable and maintaining the program's solvency, leading to premium rates that "in many cases do not reflect the full risk of loss and produce insufficient premiums to pay for claims."
The NFIP has had to borrow money from the Treasury to help cover major disasters. According to the CRS’ analysis, NFIP’s ability to borrow funds from the Treasury would be reduced from about $30.4 billion to $1 billion if the NFIP lapses.
Advocate State Capitol Bureau reporter Tyler Bridges contributed to this report.
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