Senate Attaches Vacation Home Exclusion to Flood Insurance Extension
The Senate passed a 60-day extension of the National Flood Insurance Program today after agreeing to include a provision in the stopgap measure that would exclude vacation homes.
“It’s permanent law,” Sen. Tom Coburn (R-Okla.) said of the provision, which will live on after the 60-day extension.
The extension was passed by voice vote. Earlier Thursday, Coburn said he would block the agreement unless the language was included.
“We are not going to have a flood insurance bill unless we stop subsidizing people who are very wealthy,” Coburn said. “I don’t take hostages. I am [not] willing to shoot, and this one I am willing to shoot.”
Senate Majority Leader Harry Reid (D-Nev.) had announced that he had reached a tentative deal on extending the program, which is scheduled to expire May 31 unless both chambers of Congress act to reauthorize it.
Under Reid’s plan, the provision that would put an end to the NFIP’s premium subsidies for owners of high-value and vacation homes would have expired after 60 days.
Coburn argued that after a series of extensions, reforms to the programs should be included in the extensions themselves.
“It’s either going to be permanent or we are not going to have a flood extension,” Coburn said. “If we are going to do another [extension], some of the reforms are going to go into the law and are going to stay there as an insurance policy to get the five-year authorization done.”
If Congress does not act, many homebuyers looking for mortgages in areas at risk for floods could find it all but impossible to secure one. Many mortgage brokers require flood insurance as a condition of the home loan. Most private insurers refuse to offer policies that cover floods.
Drafting and passing a five-year flood insurance reauthorization bill is part of the list of items Reid said he hopes to complete after the Memorial Day recess.
The House is expected to take up the extension next week.