November 28, 2023

WASHINGTON – One of the federal government’s major efforts to urge Americans to prepare for climate threats is in doubt after the Senate majority leader’s office objected to a plan to adjust flood insurance rates.

The Federal Emergency Management Agency prepared to announce new tariffs for federal flood insurance on April 1 so that the prices people pay more accurately reflect the risks they face. The change would very likely help reduce Americans’ vulnerability to floods and hurricanes by preventing construction in high-risk areas. But it would also increase insurance costs for some households, making it politically difficult to sell.

Last week, the office of New York City Senator Chuck Schumer, leader of the Democratic majority, pushed back the changes, according to several people familiar with the discussion. This pushback caused FEMA to halt the introduction of the new tariffs.

Senator Schumer opposed the flood insurance overhaul when it was first announced in 2019, citing the potential to increase costs for the people of Long Island. The new system would mean steeper rates for some high-end homes, and on Long Island’s south coast is the Hamptons, which owns some of the most expensive properties in the country.

Senator Schumer’s office told FEMA that the new tariffs could have “serious effects” on some New York communities, according to someone familiar with the conversation. The person said the senator’s office asked FEMA to reconsider further implementation of the plan and asked the agency for a follow-up meeting that was not scheduled until Wednesday.

“FEMA should not rush to overhaul its process and risk dramatically increasing premiums for middle-class and working-class families without first consulting Congress and the communities most at risk for the effects of climate change “Alex Nguyen, a spokesman for Senator Schumer, said in a statement. “Congress and the Biden administration must work together in a collaborative and transparent process.”

In a statement, a FEMA spokesman, asking not to be identified, said the agency would continue to work with Congress to implement the plan. The changes would result in insurance tariffs “better reflecting the unique flood risk of an individual property”.

The objections from Senator Schumer’s office create a political dilemma for the Biden government, which is committed to fighting climate change. In contrast to re-entering the Paris Agreement or banning drilling on public land, increasing the cost of flood insurance is unlikely to result in a positive voter response from voters.

However, flood insurance is one of the most powerful tools the federal government can use to limit the damage caused by climate change by influencing how and where Americans build homes. And even if the government manages to cut U.S. greenhouse gas emissions, floods and hurricanes will continue to worsen for the foreseeable future with the build-up of these gases already in the atmosphere.

That means the government must focus on warning homeowners of the risk of flooding, according to climate and disaster experts. This encourages people to take steps to reduce their exposure, such as: B. to raise or move their houses.

“Rewards should be risk based so people can get accurate signals about the nature of the hazards they are facing,” said Chad Berginnis, executive director of the Association of State Floodplain Managers. “I really hope that Congress can get involved constructively here.”

Under the new approach, according to FEMA, 23 percent of households with flood insurance would immediately see their rates drop by an average of $ 86 per month, as the updated formula shows they paid too much because of their risk. Another 73 percent would see either no change or an increase of no more than $ 20 per month.

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However, for some of the remaining households, the costs would increase significantly, according to others who were informed of the changes.

Congress prevents FEMA from increasing a household’s flood insurance premiums by more than 18 percent a year. Under the new system, some households would face this maximum annual increase for 10 years or more. As a result, their rates could quintuple at least over that time.

These sharp rate hikes would mainly apply to more expensive homes, which, according to the current formula, tend to pay too little for insurance. Many of the people who would see a decline live in lower cost homes.

Senator Schumer’s backlash is important because, as Senate Chairman, he can have a significant impact on FEMA. He controls the Senate floor and therefore controls the timing of critical confirmatory votes – including Deanne Criswell, the Biden administration’s nominee for FEMA administrator – and other senior roles.

Like any agency, FEMA depends on Congress approving its annual funding and must convince Senate leaders to support any requests for additional money or authority for new programs, such as to better respond to disasters or to address the effects of the Prepare for climate change. For these reasons, the relationship between the agency and the Senate leadership is particularly important.

The hassle is just the final delay for the overhaul.

When FEMA announced the change in 2019, the new rates should go into effect in October 2020. The Trump administration, however, postponed the new rates until this year, partly fearful that an increase in premiums shortly before the election would harm President Donald J. Trump politically, such a person familiar with the discussions.

The opposition also came from Congress, including Senator Schumer.

After FEMA first announced it would revise rates to reflect homeowners’ full flood risk, Senator Schumer held a press conference criticizing the plan.

“How can we work through a national flood insurance plan that could unjustifiably hit Long Island and New York homeowners without further advice?” Senator Schumer said at the time, citing the possible impact on property values. The Long Island coast is home to everything from humble bungalows and suburban communities to waterfront properties that cost several million dollars.

Senator Schumer’s message to FEMA at the time was simple: “Stop. Stop. Stop that plan. “