Reed, Colleagues Introduce Legislation to Enhance Proactive Flood Mitigation Efforts
New bill would establish state-revolving loan program to address and prevent dangers of floods
WASHINGTON, DC – In an effort to reduce the high cost of flood damage, U.S. Senator Jack Reed was joined by Senators John Kennedy (R-LA) and Bob Menendez (D-NJ) this week in introducing new legislation that would establish a state-revolving loan program to fund mitigation projects for homeowners, businesses, and communities to strengthen anti-flood measures and preparations. By helping states to fund activities such as home elevations, flood proofing, acquisitions, and environmental restorations, the State Flood Mitigation Revolving Fund Act of 2017 would also provide an avenue to help middle-income and low-income property owners reduce their flood insurance premiums.
Flooding is the most common and costly hazard facing American property owners, and each year the nation endures new catastrophic flood disasters and severely damaged communities. Nationally, over the past five years, flooding disasters have caused the Federal Emergency Management Agency (FEMA) to pay out an average of nearly $3 billion a year in flood insurance claims in addition to billions in disaster payments for uninsured damage. Flood mitigation experts note that the most effective flood mitigation techniques are done in a proactive – and not reactive – manner. Accordingly, the State Flood Mitigation Revolving Fund Act calls for developing and implementing a straightforward and easily accessible program through which states can offer low-interest loans to homeowners, businesses, and communities for anti-flood measures.
“This legislation will take a major step in the effort to protect our communities from the dangers of flood disasters. It will save lives, protect our vulnerable populations, and ensure that new efforts are taken to mitigate the serious risks to life and property we face from floods in Rhode Island and across the nation,” said Senator Reed, a senior member of the Appropriations Committee who helped include $983 million in disaster assistance for catastrophic flood events that occurred in 2015 and 2016, and disasters declared in 2017 and beyond. “Revolving loan programs are a time-tested way to mitigate risks associated with flooding, and this bill would especially help low- and middle-income property owners counter disastrous consequences of floods by lowering flood insurance premiums. I’m proud to introduce this bill and to help bolster proactive efforts to reduce the threats of flood disasters.”
“Our current system is backwards. Rebuilding communities after a disaster is far more expensive than working proactively to reduce or prevent their devastation,” said Senator Kennedy. “I am proud to be a co-sponsor of this common sense reform that will help save taxpayers billions of dollars.”
“Living in one of the most flood prone states in the nation, New Jerseyans understand the value of investing in mitigation and resiliency to reduce damage caused by flooding,” said Senator Menendez. “This legislation will invest critical federal resources to help homeowners, businesses, and communities better prepare for and reduce the damage caused by future natural disasters. This is in line with my comprehensive SAFE NFIP Reauthorization Act, which seeks to flip the paradigm and focus on proactively reducing damages rather than just waiting for disaster to strike. I will continue to work to ensure Americans can have affordable, accessible, and robust flood insurance that is critical to the prosperity and economic future of New Jersey and the nation as a whole. The stakes are simply too high to get it wrong.”
Modeled after the successful Drinking Water and Clean Water State Revolving Funds, which are a federal-state partnership providing communities with a permanent, independent source of low-cost financing for a wide range of water quality infrastructure projects, this new legislation would use a revolving fund that would allow states to design and more efficiently implement their own flood mitigation strategies while helping to achieve federal flood mitigation objectives.
Within this construct, the bill also gives states the flexibility to undertake flood mitigation projects without the red tape associated with other federal disaster mitigation programs. States would be required to provide 20% of the amount of the federal funds, and would be able to leverage further funding in the same way that many already do under current State Revolving Funds (SRFs) relating to water and sanitation infrastructure.
The State Flood Mitigation Revolving Fund Act would ensure that mitigation assistance is focused on areas where flood risk is greatest and where populations are most vulnerable. The bill would require states to prioritize mitigation assistance for low-income homeowners and geographic areas, pre-Flood Insurance Rate Map (FIRM) buildings, and Severe Repetitive Loss (SRL) properties. It would also give states the option of providing additional subsidization for low-income property-owners and communities to help prevent them from facing additional debt.
Since 2010, Rhode Island has experienced two Presidentially-declared flooding disasters, which have cost the federal government over $86 million in payments from the National Flood Insurance Program (NFIP). In March 2017, Senator Reed urged the reauthorization of the NFIP to reduce the risks of flood damage to properties and ensure the stability of real estate markets and the economy in Rhode Island and nationwide.