Editorial: Don't block national flood-insurance reforms

People gather in front of Babylon Town hall People gather in front of Babylon Town hall for a rally in support of National Stop FEMA Day. South Shore communities are rallying against the increase in flood insurance premiums and are making demands of the national flood insurance program. (Sept. 28, 2013) Photo Credit: Ed Betz

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The National Flood Insurance Program is crucial to the financial well-being of waterfront communities. The program, meant to be fully self-supporting, is also $17 billion in debt.

Legislation passed last year to bring flood insurance finances back into balance by gradually ending certain subsidies to some property owners would have begun to fix that, but in the wake of Sandy, lawmakers, including Sen. Charles Schumer, want to hijack that fix. That's not fair to taxpayers, and in the long run would undermine support for the very insurance program those property owners need.

The federal government provides almost all flood insurance. Many policies are subsidized, including 32 percent of the more than 80,000 policies on Long Island. Thanks to those subsidies, the average premium is around $650 per year, about half of what it would be otherwise.

For the most part, this benefit for current homeowners is not threatened by the 2012 law passed to stabilize the insurance program. But property values are, because under the rules the subsidies can't be passed along to new owners when a home is sold.

Vacation homes, businesses and properties with chronic flood problems also would lose their insurance subsidies, over time, as their rates increase 25 percent each year until they reach the level appropriate to their flood risks. The flood insurance program is intended to be self-supporting. There's no reason those who do not live on the water should have to subsidize the insurance of those who do.

The plan to leave the subsidies in place for current owners who live in their homes, make them nontransferable for those homes, and gradually eliminate them for other types of property, is eminently fair. Lawmakers in Washington won't do anyone any favors if they derail this sensible fix, and thus derail the stabilization of the National Flood Insurance Program.

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