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ONCE AGAIN, Congress went to the brink before approving legislation to extend the National Flood Insurance Program.
The NFIP was slated to expire on May 31. On May 30, the House of Representatives approved a Senate measure that called for extending the program for 60 days. President Barack Obama signed it into law only hours before the program was to expire.
We've been down this road before. Last-minute, short-term extensions of the program have become the rule rather than the exception. In some cases, the program has actually been allowed to expire, only to be retroactively reinstated. The result has been disruption of local economies as real estate deals were delayed because of the lack of required flood insurance.
We don't want to go down this road again—and this time around, there's some reason to hope that we won't have to.
One key reason for optimism is that, unlike in the past, there are no substantial philosophical differences between the House and Senate approaches. A previous sticking point was House support of requiring the NFIP to offer windstorm as well as flood coverage. The Senate wisely rejected that approach, which would have added to the financial stresses confronting the already troubled program.
This time around, the problems have been more of timing than of philosophy. While the House moved swiftly on reauthorization, the issue did not appear to be a priority for the Senate's leadership. Fortunately, an extension bill did make it through the chamber in time to allow House concurrence and a presidential signature.
So what now? Lawmakers have two months of breathing room. With hurricane season already upon us, they can use that time best by crafting a longer-term extension of the program. We'd prefer a five-year extension of the program. Also, if the program is to remain viable, it must be revamped and permitted to charge adequate rates. We'd like to see a greater role for the private sector in the provision of flood insurance, too, but that may be some time off.
We're back from the brink. If Congress uses the next two months wisely as it considers the NFIP, we may not find ourselves back on the brink again anytime soon.