Congress works to reauthorize Flood Insurance Program by fall. (Industry and Institute News).

An April 1 House Financial Services subcommittee hearing on reauthorizing the National Flood Insurance Program focused on the fairest and most efficient ways to address so-called repetitive loss properties.

Defined as structures with two or more flood-related losses of more than $1,000 each within a 10-year period, about 48,000 properties fit this description and account for about $200 million in losses annually, according to the Federal Emergency Management Agency, which administers the NFIP. The program expired Dec. 31, 2002, and was reauthorized Jan. 13, 2003, through the remainder of calendar year 2003. The legislative proposal under consideration would reauthorize the program through 2007 and provide additional resources to help reduce flood losses.

Testifying before the Subcommittee on Housing and Community Opportunity, Rep. Richard Baker (R-La.), who introduced the Flood Loss Mitigation Act (H.R. 670) Feb. 11, said his bill would give FEMA broad authority to aggressively mitigate repetitive loss properties. FEMA should have the discretionary authority to get rid of the multiple offenders who are violating the principles on which this program was built," Baker said.

However, Baker's bill also contains a series of provisions that he said are designed to protect policyholders who under certain circumstances may have a defensible reason for refusing a mitigation offer. Those conditions, Baker said, include:

* cases in which a buyout offer would mean a policyholder could not remain a homeowner;

* instances where mitigation activities would significantly disrupt culturally or historically significant areas;

* instances in which flooding resulted from the actions of a third party, such as an upstream development that caused flooding on a policyholder's land; and

* cases where policyholders purchased a property that flooded after they relied on a FEMA floodplain map.

There is another similar legislation up for consideration, which would also authorize the program through 2007.