Hurricane Katrina, Superstorm Sandy and the 2016 floods in Louisiana blew up the total amount of debt the National Flood Insurance Program carries, leaving the federal program $24.6 billion in the hole as of Jan. 17.
Now Congress is gearing up for a heated fight over the government-backed flood insurance program that owes billions of dollars to taxpayers and is set to expire this year, The Wall Street Journal reports.
What to do about extending the NFIP is dividing Congress along regional rather than party lines. Lawmakers in flood-prone states are at odds with those in other regions weary of subsidizing residents of riskier areas along coasts and waterways. Another issue is convincing homeowners who have been paying artificially low rates for insurance that they must pay more.
The program, created in 1968, was meant to offer more affordable flood insurance to property owners. It quickly priced out private insurers from the market and has grown to more than 5 million policies worth about $1.2 trillion.
While lawmakers agree the program’s ills need to be addressed, they are at odds over how to stabilize it. Protracted fights in the past have led to temporary lapses in the program, causing thousands of home sales to stall.
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