FEMA Rollback Signed Into Law

President Barack Obama this week signed into law a bill to prevent an immediate spike in flood insurance premiums.

After consecutive devastating storm seasons, Congress passed the Biggert-Waters flood insurance legislation to stabilize the debt of the federal flood insurance program. As Federal Emergency Management Agency flood maps were being changed to limit homeowners who could be covered, this legislation imposed rate hikes on a variety of other homeowners in danger of flooding.

“Homeowners throughout Long Island can breathe a sigh of relief now that the specter of massive and immediate rate hikes are off the table,” said Senator Charles Schumer. “Families could be faced with the loss of their home, or the inability to sell their home, due to these crushing rate increases and this compromise bill addresses both of those serious concerns.”

According to Senator Schumer’s staff, Congress did not anticipate how quickly the rates would spike, and last week’s legislation caps the percentage increase that any homeowner will see at 18 percent.

Whereas previously certain East End homeowners could anticipate a yearly increase of about 25 percent, an entire flood district, based on the FEMA maps, will also be capped at a 15 percent increase.

According to Mr. Schumer’s office, this came about as a compromise, after the Senate wanted to see the rate hikes delayed entirely until an “affordability study” was completed, while the house wanted to cap the rates at a slightly higher rate.

The new law will also reinstitute the grandfathering in of houses that were built to code at the time, but have since been remapped.

In addition, it will eliminate the “sales trigger,” meaning that if one of the newly flood-mapped homes were sold, the new homeowner would have immediately been hit with the full rate instead of seeing it phased in.

Homeowners who have already been affected by the Biggert-Waters legislation as a result of a property sale are eligible for refunds through the new law.

U.S. Representative Tim Bishop lauded last week’s developments, saying in a statement: “The provisions of this law will help many residents of coastal Long Island. It will slow the increase in the cost of flood insurance premiums and provide refunds to residents who have already paid significantly inflated prices.”