Legislation in the U.S. Senate may delay higher flood insurance premiums for coastal communities by up to four years.
Senate Bill 1926 would delay Biggert-Waters, a 2012 law to reform the National Flood Insurance Program, for much longer than the eight-month delay passed earlier this week in a $1.1 trillion government funding bill.
Biggert-Waters sought to reform the NFIP - currently in $25 million worth of debt after Hurricanes Katrina and Sandy - by forcing homeowners to pay the "full risk" amount, but many of those homeowners won't be able to handle the skyrocketing premiums.
One provision that is especially troubling for Southwest Florida homeowners is the elimination of "grandfathering," where homeowners could have kept their old rates if they had built their property to code.
The local housing market will also take a hit because prospective buyers will be forced to pay the "full risk" amount upfront.
Sen. Bill Nelson, D-Florida, said last week's funding bill only helps a small percentage of homeowners and more needs to be done. He is confident that S.B. 1926 will pass.
"I'm an optimist. I believe it will pass. It's the right thing to do," said Nelson.
On Monday, Jan. 27 the Senate will vote to break a filibuster and the next step will be full consideration of the bill. Nelson said it could theoretically pass within a week-and-a-half, adding that there is support on both sides of the aisle.
If passed, the bill would delay rate hikes by four years while an affordability study could be completed. Biggert-Waters originally asked for an affordability study before implementation, but it was never done.
Nelson said both parties originally passed Biggert-Waters to ensure the NFIP was financially sound, yet he said it isn't fair for homeowners to be immediately responsible for the "full risk" amount.
"Even if it is actuarially sound, we don't want people to swallow it whole all at one time," he said.
There are a number of flood insurance bills circulating both chambers at the moment. The House of Representatives would have to pass their own bill to be reconciled with S.B. 1926 before any changes could be made.
House Speaker John Boehner, R-Ohio, told the Associated Press that he supported more modest changes than the ones being considered in the Senate.
In an earlier interview with Chris Heidrick, principal owner of Heidrick & Co. Insurance on Sanibel Island, he said that the eight-month delay wouldn't help Southwest Florida because changes weren't going to be implemented until late 2014.
"It does nothing to provide relief for that person whose premiums have gone from $2,000 to $20,000, nothing to provide relief for those people who are currently benefitting from grandfathering, it does nothing for FEMA (Federal Emergency Management Agency) to get additional information to come up with a better, more appropriate plan to fix the National Flood Insurance Program," said Heidrick.