Transcripts For CSPAN3 FEMA 20240705

On cspan2. The reauthorization of the National Flood Insurance Program. Femas perspective. All members will have five days for extraneous materials to the chair for inclusion in the record. I recognize myself for five minutes for an opening statement. Thank you for appearing today for the second hearing for the housing subcommittee for the 118th congress. Fema plays a vital road through the Disaster Recovery efforts and today well explore the National Flood Insurance Program which existed over 50 years and until recently has operated in the same manner and relied on the same outdated tools since its creation and i just applaud the progress that youre making as flooding in the United States is a significant and costly problem for coastal and inland residents. Unfortunately, theres only one provider for nearly all Flood Insurance and the governmentbacked program which sells in a 93 to 95 of all rest tension Flood Insurance in the country. Thats not just a bad idea from the perspective of creating a workable insurance model, its also proved to be costly for taxpayers. Today the program finds itself 20. 5 billion in debt even after congress outrate for gauge, 16 billion just a few years ago. It seems clear to me that the program is in desperate need of reform and im glad that fema is bringing that reform. The process needs to start with this hearing and with the reauthoritization, which we hope this hearing will help us achieve the consensus to pass with legislation. Lately the committees not been too involved in the oversight of ongoing operations. Today is the first time weve heard from fema on nfip in over six years. Thats something we need to get more serious about if were going to modernize the program that was created before the moon landing in the 60s. This committee has an Important Role to play in its oversight of nfip and congress can identify whether the program is operating in an effective and transparent manner. Congress, however, has been missing in action from that job as the previous majority left the program on autopilot for shortterm extensions and Appropriations Bills and frankly the previous republican majority didnt finish the major reform. Thats only not only removed us from the process, its made the program vulnerable to uncertainty for the policy holders. We should do better. And while congress does this important work of reforming the program on a longer term basis, ive introduced hr1392, the extension act of 2023 which would authorize the program through at least december 2024. This bill would not only avoid a lapse in coverage, but would give the committee the time and deadline freedom it needs to do a deeper dive into Flood Insurance reform and conduct additional insurance on stake holders and a reauthorization. This work is crucial and will ensure that the program is moving in the right direction for taxpayers, policy holders and particularly, given femas recent internal work, to incorporate industry best practices and technology into its management of the program. That includes most notably. The work regarding adoption of the risk rating 2. 0 methodology which is a transformative to modernize how accurately measures flood risk. Its a good first step in moving towards longterm financial visibility for nfip and one that certainly deserves our attention to ensure this program can for those most at flood events and for years to come. I look forward to exploring it and femas other recent modernization acts with you today and so, we may have a set of policy recommendations for congress on our forms that will get this program on a sustainable path. With that, i thank our witness for this testimony today and ill look forward to the conversation and i yield and i now recognize the Ranking Member, Emanuel Cleaver from missouri for four minutes for an opening statement. Thank you very much, mr. Chairman. Let me preface my comments to saying i look forward to working with you. We have to give a great deal of our time and interest and creativity to resolve. Floods are the most frequent and Severe Weather threat and the costliest Natural Disaster facing the United States of america. Flooding events have occurred in all 50 states and 98 of u. S. Counties. Accord to go the department of Homeland Security being 90 of Natural Disasters in the United States involve flooding. Super charged by Climate Change, these Natural Disasters are increasing in both frequency and severity. Shortly after i was elected, katrina hit and at that time our Ranking Member ms. Waters, ms. Biggers led the delegation down the mississippi and we saw what devastation occurred in that area. And since katrina on in new jersey and new york, the east coast, we need to address this issue. Hurricane katrina was destructive and cost a great deal of money, the costliest flood if u. S. History which means the National Flood program was hit with major losses and industrial struggling 16. 2 billion for hurricane katrina. 1. 3 billion for hurricane irene. 8. 8 billion for hurricane sandy. And 1. 1 billion for hurricane irma. 1. 5 billion for Hurricane Ida and others and the nfip is endispensible to the resiliency of American Communities and five million policy holders. Many of these families are low or moderate income and due to the Affordable Housing crisis the hearing has not held yet on that congress. However, the growing strength of floods and storms that caused them are increasingly straining Financial Health of the nfip. The nfip is over 20 million in debt and the program pays well over 1 million a day in u. S. Treasury interest. This is the Third Largest by cost. In no uncertain terms, its fiscally unsustainable and it should should include the territories and in many ways dealt with almost as if they were stepchildren to the United States of america. In no unclear terms, the Current Program is fiscally unsustainable. Nfip reauthorization and what should be a longterm reauthorization is an opportunity to put the program on sound financial footing, increase risk analysis and communication, improve Community Resilience and make technical and operational enhancements to the program. This committee has an opportunity to make our families businesses and communities safer and more resilient and to build and rebuild in a way that meets the challenge of the reality of Climate Change. I am interested to see the republican plan on flood reform. As i just mentioned to the chair, and i intend to make myself available to work with him and thank you very much, i yield back. The Ranking Member yields back and the chair now recognizes the chairman of the full committee. Mr. Mchenry for one minute. I want to thank the chair and the Ranking Member and thank members of the committee for workening a bipartisan way to work on the work that then chairman waters and then i, worked on reform in a balanced way and we reported that without a dissenting vote and dealt with a lot of large challenging issues there and we seek to work in a bipartisan way and we thank the administrator for being here and his leadership and his teams leadership to take into account the changing climate and make sure that we take care of those in our society that are challenged to pay these bills. We make sure that we have a program thats current with the risks and balance to the American People and i want to thank the subcommittee for dealing with this. And for a point of privy want to recognize long Time Staffing member, ed scala, and for the first time, his mother is here. [laughter]. [applause] and so so beatrice, bonnie, eds sister and niece alexa, thank you for being here. Thank you for keeping tabs on ed. He has sharpened up this day because youre here and were grateful for that and im grateful for his advice as counsel, a long time key member of the Financial Service committee, works with democrats staff, and republicans staff and i count on his counsel every day. With that ill yield back. The chairman now recognizes Ranking Member of the full committee, ms. Waters for one minute. Thank you very much mr. Davison, i appreciate this hearing today. Congress designed the nfip to be selffunded through annual insurance premiums collected from policy holders. Currently drowning in 20. 5 billion in debt with a Million Dollars of interest accruing every single day. And i am just wondering what effect it would have if congress simply enacts a clean reauthorization of the nfip and maintains the status quo for the program and instead im not going to raise that request question now, but anxious to hear what is going to be said today. I want mr. Maurstad to explain to us how hes going to carry out the function of nfip. I want him to talk about money. I want him to talk about debt. And i want to get down to some real answers today. So with that, ill yield back the balance of my time. Ranking member yields back and today we welcome the testimony of david maurstad, fema administrator of the directorate and the Flood Insurance program. He was 25 years in Public Service and insurance. And received a master of Business Administration from the university of nebraska. We thank you for taking time to be here. You will be recognized for five minutes to give an oral presentation of your testimony. Without objection, your written statements will be made part of the regard. Mr. Mar maurstad, youre now recognized for five minutes. Good morning, ranking chem, chairman, ms. Waters, members of the subcommittee. Thank you for the opportunity to testify today regarding femas perspective of the National Flood Insurance Program. For more than 50 years nfip has been critical. And today Climate Change opposes a serious threat. The nfip requires meaningful structural change and since the last multiyear authorization in 2017, nfip has experienced 25 shortterm extensions and lapses. And potential policy holders to lose confidence in the nfip. We believe had a that 10year reauthorization with come hence is i have program reform is vital. We propose 17 recommendations to reform the nfip that are guided by four key principles, first, ensuring that more americans are covered by insurance making it more affordable. Flood insurance is unaffordable for some policy holders. Under current law fema does not have the authority to charge premiums based on a policy holders ability to pay. Although they offer mandatory discounts and subsidies, these do not take into consideration the policy holders financial need and in fact, make Risk Communication difficult because people may equate lower cost with lower risks. Reforms that address affordable, such as the use of a targeted aadvance program can offer low and moderate income, current and prospective a graduated risk premium discount while providing them with the knowledge of the full risk to communicate a propertys flood risk. And its realtime with tools to manage flood risk. Reforms that increase the scale and frequency of flood mapping and emerging priorities and technologies into flood hazards and flood Risk Identification process, will expand the ways in which nfip communicates risk. Raising an awareness of true flood risk enables people to make informed decisions about their family and property. Home buyers and renters may lack awareness about flood risk when they complete real estate transactions. Reforms that would require states to establish minimum flood risk reporting requirements for sellers and lessors before transactions close would address this challenge. Additionally we need to inform how we measure the flood risk. They require flood hazard information thats more robust than the special flood hazard area and 100 chance flood elevation. Third, reducing risk by addressing extreme repetitive lost properties. Previous losses are a significant indicator of risk. If a property flooded before, this is a high likelihood they could flood again. And two or more paid losses nearly 3,000 have suffered 10 or more losses. Nfip must have better tools to address insured structures that experienced multiple flood claims. Almost 3 of insured properties are considered unmitigated, repetitive loss properties. Reforming the nfip to institute an objective threshold to deny coverage to the most flood prone structures would discourage unmitigated rebuilding in areas with a history of flooding and reduce risk, financial risk to the nfip while ensure coverage is still widely available to individual families and businesses who might not be eligible for private market average. And fourth, instituting a sound and transparent financial frame work that allows the nfip balance affordability and fiscal soundness. Without in in place, longevity and sustainability of the program is at risk. Nfip currently carries 25 billion in the treasures and the interest in fy23. The program is burdened and unable to pay the debt in full. Canceling the nfips debt provides a Solid Foundation with supporting financials around borrowing, future enhanced liquidity and these reforms address fundamental structural challenges and are essential to building a viable, sustainable, the nation needs and deserves. Its critical that congress provides needed operation and currently reform the nfip. We look forward to working with congress and develop a longterm solution that addresses the needs of the nfip its policy holders and the nation. Id be pleased to answer any questions. Thank you, mr. Maurstad. We now turn to member questions. And i recognize myself for five minutes for questions. And thank you for addressing the need for reform for 15 years now the Government Accounting Office has consistently labored nfip as quote, high risk programs, calling it out for several things, including premium rates that do not reflect the full risk loss, transferring some financial burden from individual Property Owners to taxpayers and lack of transparency that leads to quote, mistakenly perceived leads to some, quote, mistakenly perceive theyre not at risk of flood loss. Unresolved affordability issues which you addressed for policy holders. All of that seems like a grim picture with the job that youve walked into. Can you paint for us, a picture of what the programs future looks like if we dont reform nfip and how critical that we bring this 50yearold program into the 21st century with modern tools and techniques . Yes, first of all, it starts with the financial structure of the program. It has already been mentioned a number of times. Being saddled with the interest cost that is provide no real benefit to the program is harmful. If we look at the proposed recommendations that weve provided, that include the development of a sound Financial Framework. If we do nothing, theres a 2 chance that at the end of 10 years, the National Fund will have dollars more than what they started. If we enact all of the proposals that weve put forward theres 81 chance. 81 chance not 2. 81 chance that the fund will have more resources at the end of that 10 years, so structurally as we look at the nfip as we look at flood risk grant and identification, and the insurance, having that sound Financial Framework is critical for the sustainability of the program. Thank you for that and i applaud you, frankly, for the progress you have made on the i. T. On that as well. And one of the things that comes up often is mapping. How can home owners appeal or challenge a zoning determination. I know under risk rating 2. 0, flood ratings are no longer an element for nfip rate, but theyre important for the application of mandatory purchase requirements for properties under the Flood Disaster act in 1973 as well as determining eligibility for policy holder discounts like the newly mapped status, so on, so forth. Can you describe what the current mapping appeals process is for home owners under risk rating 2. 0 and how that is distinct from the mandatory purchase requirement . So, the investment of probably over 5 billion in the 22,400 communities, flood maps across the country, is vital as we continue to look at how we can best identify flood risk. Theyre for two primary purposes. As you indicated, one outlined the special flood hazard area, the high risk area where communities then agree in participating with the program to regulate construction in that area. And the second is the mandatory purchase requirement. Dealing with the first, its a local ordinance, so to start with, you can look to the local government to make sure that your property is accurately reflected in the local communitys Flood Insurance map. Beyond that, we have two ways. You can go directly to fema for a flood map amendment and then theres also a second. So, we encourage policy holders to work with their agents, to work with their community leaders, and the regional staff that are there to help that would be helpful, also. If theres a question about their flood zoning to come to fema and we will help address that. Yeah, thank you. And when it relates to mandatory purchase, i think in particular, it would be good to have a path where the lender after property doesnt necessarily agree that this is is in a flood zone, if you can establish with the surveys and what not, that this is clearly not in a flood zone, that we let the underwriter take the risk and then you guys are astute folks, youve chosen and proven that its not in a flood zone and you can decide. I think just for the record, you might not know it off the top of your head, you look at repeat losses. Whats the record holder. The number of times weve rebuilt or paid for the same property. Ive heard reports as high as 30, 35. You know the record off the top of your head . I do not. I know that its way too high. Could you get that back to us . The record holder. Yeah, i will. Thank you. My time has expired and i now recognize the Ranking Member, mr. Cleaver from missouri for his questions. Thank you very much, mr. Chairman. You know, the katrina, i want to go back to that for just a minute because some of the things we saw. Senator trent lotts house was wiped away, nothing left. Congressman jean taylors house was wiped away, the front stoop was still there. Gone. Now, even though we have some initial problems, eventually they were taken care of, but the majority of the victims were poor in mississippi, in and around biloxi and in new orleans. So, while renters do qualify to purchase nfip coverage and often are affected by flood dass disasters, theyre less likely to have Flood Insurance. In new orleans we have Public Housing decimated in new orleans and at the time we only had one well, we still do, one replacement. So we can only replace the units that were just awful. But the poorest people in the country suffer the most when these disasters hit. Mr. Administrator, can you just discuss what we knew about the renters relationship with private Flood Insurance and what may be some answers to this issue . Yes, sir, thank you for that question. I recall the devastation associated with katrina very well as i was leading the National Flood Insurance Program at that time, also, and it really exposed a number of the faults associated with the program that we need to continue to work on and address. And certainly theres no question that with discriminatory land practices of the past that many less fortunate americans live in the high risk areas for flood in communities across the country. Which is really why the affordability proposal that weve included in our recommendation is important for the committee to consider. Being able to help those individuals have that financial the Financial Resources they need after a flooding event is critical because theyre the ones that have the most difficulty in recovery. Weve seen that time and time again. Thank you very much. The private market, we know that defining characteristics between nfip and the private market that federal government cannot deny assumers who apply for coverage and nfip. The private market can, unless its based in some kind of discrimination and weve heard from home owners in houston, texas where water comes out of the bayous, houston, texas, they were dropped by their private insurers following hurricane harvey. While some had the means and desire to purchase new Flood Coverage after being dropped, many share they were denied coverage by the private market. Can you expand on the Market Trends and what real fema might play here . Well, theres a couple of points id like to make, sir. One is, we need more Property Owners renters, Small Businesses to have Flood Insurance coverage, theres a huge Flood Insurance gap that needs to be filled. The nfi about. Is working to do that, but we also need the private sector to also increase their efforts to try to make sure that Property Owners have the coverage that they need. And as you pointed out, especially renters, because we know not, you know, very few renters recognize the flood risk they have so were working with our agents to make sure that we also have a focus on not just the dwelling, but also those that those that rent. So the very, very serious problem. One of the recommendations is to let a policy holder that leaves the National Flood Insurance Program and tests the private market, if they want to come back to the program that we bring them back into the program in the same position as they were in when they left the program. So if they were on a glide path to the full risk rate, they would enter the program back in the same place as the glide path when they left. Thank you, my time is running out and im interested in the whole issue of reinsurance and how it impacts of industry and you and i have had some conversation about this already. I yield back. Thank you. The gentleman from wisconsin mr. Fitzgerald is now recognized for five minutes. Thank you, mr. Chair. In late july, 2022, fema release add concerning draft proposal called direct to customer and in its release, fema noted its imperative fema noted the sale of Flood Insurance to look at the insurance of the people could covered and noted longterm stress theyre in early stages of looking at the concept. In this digital age theres always rush to cut that process can replace Human Interaction and expertise. Any proposal that undercuts the role of the Insurance Agent and the brokers in their role how this plays out could have a negative impact on increasing Flood Insurance participating rates and we talked about this already this morning. We saw similar dynamic play out in the loans offered directly by f. D. A. During the pandemic. A perfect example which had much higher incident of fraud than the ppp loans which were issues through financial institutions. Weve heard a lot of concerns about the direct customer approach to distributing Flood Insurance, that ultimately would not reach customers, that nfip or agents are not already reaching. And the agent which we heard from last month continued to play a role in the servicing plans. Its unlikely a call center would offer this same kind of perspective. To me, it sounds like a mess. So my question to you is, whats your take on the status of femas exploration of direct to customer, direct to consumer Flood Insurance plans . Thank you very much for that question. My First Response could be that were being very careful and very deliberate about our exploration of whether it makes sense for the National Flood Insurance Program to entertain the thought of developing a direct to customer program. As an agent for two decades, i fully understand the value associated with agents and at this point in time and as we continue our exploration, theres no intent to not have agents involved in our direct to customer program. So we vitally rely on the Insurance Agents to be able to accurately and helpfully provide the information that their customers need to analyze their flood risk and then have an Insurance Coverage that they need so much after a flood event. Bear with me, too, on this question, but just kind of following up on a proposed direct to customer online sales, i just wanted to prove that point, but i mean, the data thats required, you know, simple stuff, but the foundation type, the present to number of flood openings, depending on the foundation type, data construction, existence and identification of any substantial improvements, construction type, flood proving status, eligibility for machinery and equipment elevation discount. Square footage, number of floors, building replacement costs and these are the things that an agent hands on would take a look at, am i correct . And this is not just a simple formula in which you say plug in this number, plug in this number and here is how much youre going to get, right . Absolutely. Youre not going to get any argument from me on the importance of this agent in the process and again, i would emphasize that we are in the exploration phase of looking at this. But we do feel its our responsibility today to look at every way in way we can potentially close the insurance gap that the country faces. If were going to have a modern nfip that meets the needs of the customers where we are, we at least have to have the answer as to why or why we do not have direct to customers. Thank you very much. Id just say, chairman, i think this is one of the concerns is this can definitely be over simplified especially in some of the hearings that weve had here in congress. I yield back. The gentleman yields. The chair now recognizes the Ranking Member of the full committee, the gentle woman from california, ms. Waters. Thank you very much. Im from california and weve been suffering recently with both fires and flood and so for a couple of years we had drought and then because of Climate Change which is denied by some people, it rained, i think, for three weeks or more every day and so, we have some real problems and now weve really got to figure out what to do. Now only are we having these problems in california, i was recently in florida and i saw people who had gotten a little bit of money from fema that wont even begin to restore their homes, et cetera, et cetera. And so let me just ask you about congress designed nfip again to be selffunded through annual insurance premiums selected from policy holders and currently are drowning in 20. 5 billion in debt. Who do you owe debt to . We owe debt to the federal treasury now. Yes, to the government. Are you part of the government . We are, so the government wants you to repay the government this debt, is that right . Thats our obligation. That doesnt make good sense. The npip is drowning in 20. 5 billion in debt with a Million Dollars in interest accruing every single day. Again, what effect would it have if congress simply enacts a clean reauthorization of nfip and maintains the status quo for the program and its debt . Thank you. The cancellation of the debt is one of the recommendations that is a part one of the 17 recommendations that weve put forward and is basis for which we can start to begin a sound Financial Framework for the program that is understandable transparent and predictable. So, its vitally important that we have the debt canceled. That we dont have the burden of the interest costs that you mentioned, that are only going up in this high interest environment. So its a key part of the recommendations that weve put forward. So in addition to your basic responsibility, you cant even get to mitigation and helping locals with mitigation measures and other kinds of things that would help when these floods come. So have you made it known to everybody and both sides of the aisle understand that we need debt cancellation . Yes, i mean, weve been very clear how important that is, and we also do want to, however, thank congress and the administration for the unprecedented amount of dollars that have been provided to fema for our mitigation programs, whether that be our Building Infrastructure and community program. Whether that would be our flood mitigation Assistance Grant program. We have more mitigation dollars available than we had before. We still, a long ways from meeting the entire need, but its definitely progress and were looking at making sure that all parts of the community, mostly to the disadvantaged, vulnerable communities are a part of these grants, new grant proposals that are unfolding. So since ive worked on Flood Insurance for a long time, would you describe the competition in the United States from various areas putting pressure on you to say, you know, my area is more important than their area, i need more up here than they need. Would you describe to them the kind of competition that youre confronted with, where people are desperate for help that you cannot provide . Well, there isnt any certain any question that members are most concerned about their own constituents and thats who we hear from a lot, but i would say that all across the country, we work with, through our region, with the state to identify the risky areas in their communities that would be able to have access to our mitigation funding. So, we run a National Program, were sensitive to all parts of the country, and were, i think, doing a good job of making sure that we dont leave anybody behind. Youre doing the best job that you can possibly do, but i want you today to let these people know they can leave us fighting with each other about whats needed on the east coast opposed whats needed in the south on and on and on or we can cancel this debt and do something about Flood Insurance, thats all i want you to do. Theres no question that the competition for mitigation funds is deep. We certainly are three to four times oversubscribed when we have our grant process so theres a great need for mitigation across the country. The gentle woman yields back. Next we have the gentle woman from texas, ms. De la cruz for five minutes. Thank you, mr. Chairman for holding this important hearing today and thank you, assistant administrator maurstad, for taking the time to appear before congress. As the chairman mentioned, this is the first time that a fema official has appeared before this committee in over six years. It is time for congress to assert its role in reforming the National Flood Insurance Program know order to assure its longterm solvency after years of extension and minimal oversight from this body. As the vice chairwoman of this subcommittee i look forward to working with chairman davidson, along with nfib for the taxpayers and sustainable for the longterm. With that in mind, what steps has fema taken to improve its efficiency and effectiveness of the nfips administration and how can the program be reformed to better serve its policy holders and taxpayers . So i would say that the answer to that is in the 17 recommendations that weve provided. There were nearly 100 subject Matter Experts that worked on the recommendations and thousands of hours put into what the Program Experts believe need to happen to make sure that we have an nfip thats sustainable into the future. So were looking at what do we need to do from a pricing perspective to make sure that were fairly and accurately identifying the risk and charging the right premium for it, were in the process of developing new policy forms, our product, so to speak, so that we can better serve our policy holders and improving the distribution of the program through a simpler method that they can write nfip. I have insurance experience over 20 years and owned my own agencies for those 20 years and nfip is near and dear to my heart. I have one of the poorest in the nation, Hidalgo County and its dependent on nfip and the benefits that it provides to the customers. So when we talk about reform to better serve the policy holders, i think about how we can distribute this product and get more consumers involved. As an agent myself, i can tell you what is burdensome. What is burdensome is that we have to use, number one, our Agency Platform in order to sell home owners coverage and then we have to go to a completely different platform in order to actually sell the Flood Insurance product. And so, that takes time. It takes more education and learning the whole new platform. How can we solve the efficiency in the Agency Program to make it easier for an agent to tell the product . As i mentioned earlier, i was an agent for a couple of decades, also, as certainly understand the concerns that you raise, which was one of the Drivers Behind why we developed a new rating engine and have replaced the old manual that was twice the size of the binder that i have in front of me, that took many hours to be able to write a policy and so, with our new rating engine, you can answer roughly a dozen questions and have the premium, you know, 817 for this particular property. So weve really streamlined the whole application process and the ability for agencies to more effectively market and sell our products. With that, ill yield back. The gentle woman yields back and next to the gentle woman from new york, ms. Velazquez. Administrator maurstad, ive long called for a 10year reauthorization of nfip. And to provide enough time for congres and the types of reforms that are needed to make it more stable. Wouldnt you also agree that it is hard to consider reforms or have hearings like this when you are working under shortterm reauthorization windows and worry about the programs lapsing . So the short answer is yes, which is why one of our recommendations is, in fact, to reauthorityize the program for 10 years and provide that stability that the Program Needs and our communities and our policy holders deserve. I represent new york and in new york multifamily housing is central to the housing stock. To date, fema data on risk rating, 2. 0, have focused exexclusively on its impact on the Single Family residential markets, where one family and commercial properties are included, they are combined with Single Family and not yet full light on the risk the buildings may face. Is fema planning to separate data, multifamily and commercial properties from data and Single Family structures so that owners of these properties might fully understand the risks . So i think you raised a certainly an interesting, an interesting concern, that i will take back. We are looking, of course, at ways that we can best understand what the impact of our program have on whether its renters, Single Family home owners or multifamily. Were looking at ways that we can now capture the data with our improved Information Technology system and so, definitely take that back and have more conversation with you on what youre looking for. Please do so. This is an issue ive been raising every time weve held hearings on Flood Insurance. While there seems small when compared to the Single Family homes in the nfip risk pool and commercial and policies must face significant amount into the nfip. Can you give us a sense how much these properties are receiving on the climbs side in an average year as they are are they a financial drag or a benefit on the program . Certainly dont have that information right with me. We will we can get that information for you and provide it to you. Thank you. According to the puerto rico planning board, were talking now u. S. Territory, 200,000 residences on the island are located in flood prone areas, yet, according to femas data as of february of 2023, only 4,368 units have active nfip policies. What actions is fema taking to ensure that more home owners and renters in puerto rico are covered by nfip policies in light of what we witnessed after maria . Yeah, so very much a question, very much an issue, very much a concern to the program. Ive actually met with the insurance commissioner of puerto rico when i was down there, working with him on what we can do to increase the number of Property Owners that have Flood Insurance protection and were going to well keep working on that because as ive said, seeing home owners renters, that dont have coverage in neighborhoods that i visited after events, its tragic, their lives are completely disrupted and turned over so we need to do what we can to make sure they have their coverage. I believe the affordability proposal that weve included in our recommendations would be helpful. You need to be more proactive in that sense. Lack of awareness and information is an issue here, thank you. The gentle woman yields back. Next well turn to the gentleman from florida, mr. Posey. Thank you, mr. Chairman. Mr. Maurstad, how much has the Flood Insurance program spent on maps . Ill let you the exact figure, but its upwards of a 5 billion investment. 5 billion investment . Yes, sir. Does that include recent years. Ill get you the exact figure and the amount over by year, but thats cumulative. The last few years, roughly speaking in about 600 million what is the most time the Flood Insurance program has paid for a total loss or maximum policy limits on one single insured property . The number of times . Uhhuh. I dont have the exact number. The question game earlier, ill certainly get it. I know as i indicated in my opening remarks, there are hundreds of properties that have had more than 10 losses. Yeah, weve heard numbers as high as 16 times, and paid for a single total loss and we even heard one time, 100 one time and they paid 30 times for total loss of property which is absolute complete insanity in my opinion. Sir, right now we dont have the authority or the ability to not provide coverage to someone thats in a participating community so thats why weve put forward in our recommendations a multiloss provision that would address the problem. I would say once you pay for total loss, this is off the map and not going to insure this property again, much less 10 times. And one called the fema flood maps useless. Could you explain what is meant by that. My conversation with the administrator, that shes supportive of the Mapping Program that we have. Recognizing as as we put forward in our recommendations that we can do more than were doing now to identify risk outside the high risk area through nonregulatory products and so, i believe that the administrator, without doubt, sees the value with the flood maps and the communities across the country. When i was elected 14 years ago, they said to properly evaluate risk they needed new maps, it would cost 500 million and then take three to five years to evaluate the maps. You know, and i suggested i passed amendments here a couple of times saying how about you use dod, Homeland Security or noaa maps . They have a current topo on every inch of this country. Theres no need to go outside to pay for more maps to be developed. The assertion of the state flood plain manager estimated to consistently update 700 million to and that the current policy for mapping would have to be raised to a letter to threaten affordability and discourage insurance. Would you care to comment on that . Again, i think that the investment, of course, in our flood maps, whether its from the policy holder fee or from the appropriated maps from congress are important to make sure that our maps accurately reflect the one in 100 chance event in the communities across the country. Why does fema continue to resist making the data and methods and models they use and calculations and how they calculate it under risk rate 2. 0 completely and fully transparent . Sir, i believe weve provided all the information that has weve been requested to provide and been very transparent. Weve provided the entire methodology for the development of the actualial, and if theres information that would be helpful to you, we can provide that to you. How can policy holders appeal their premiums under 2. 0 . Well, they work with their agents, the same way they work their premiums on the other insurance with the agent. If they think that the information thats gone into developing their premium for their particular property is inaccurate, then they can work with their Insurance Agent to correct that and make sure that the premium that theyre being charged reflects the risk of their property. Gentlemans time is expired. Next well go to the gentle woman from michigan, ms. Tlaib. Thank you, wed like to submit a New York Times article, a broke, broken for the record. Thank you so much. As you know i come from an incredibly very strong community, the city of detroit, that we work movements on a number of things that i think kind of change trajectory for our whole country not just in the auto industry, music and everything, but even now, i talked to our chair of our committee about the fact that many of our families farther away from bodies of water are now impacted in a very significant way from flooding, were seeing that more and more. In my district i was shocked to see like my familys four times within one summer between june and july, the community of the city of dearborn, huge amounts of flooding. In inkster, i met a Senior Citizen whose didnt get any coverage or anything and still is dealing with mold, shes in her 70s. All of this. So i started looking and researching, whats the process of getting Flood Insurance. Of course, mapping continues to come up, but say, for instance, mrs. Smith from inkster or from aviation sub in detroit or dearborn picks up the phone and says i want to get Flood Insurance. By the way, the average Home Insurance in detroit specifically is 3700 dollars. The majority of homes in my community that i mentioned are less than 100,000. This is working class families. She picks up the phone and she wants insurance, go to the list or whatever. It comes back incredibly unaffordable, right . Weve talked about this. What is she supposed to do at this point because when she went to the fema site, sorry, first, they dont clean out basements, i dont understand that, unless theres a room or somebody sleeps down there, a whole process this they go through and she brought her pictures and showed the receipts of all things, there was no sense of how she didnt get covered. I dont know what were supposed to do when the National Program to me doesnt include all of americans that are impacted by flooding right now and even when i talked to chairman mchenry, we talked about this, i dont know, you tell me, administrator, out of those close to five million that can afford this, what is their income . What is the worth of their homes . Is this the Million Dollar homes that get access to the Flood Insurance . I want to know because the families in my community are not able to access this in an equitable way and i dont know how we change this because i know were just going to renew this and not make any changes, thats whats going to happen because i saw it happen over and over again. The affordability problem is one thats been around for a while and congress recognized in the 2012 reauthoritization that as discounts and subsidies move awayen the affordability is more of an issue, so you charged fema with developing an affordability framework which we provided to congress in 2018, which is the basis for the proposal that weve put forward to develop a means tested premium assistance affordability program. But the report tells us that about 25 of the individual policy holders in the high risk area are low income. It also tells us that 50 of the Property Owners in the high risk area. 50 are low income. So its abundantly clear, and i understand how difficult it is to have those kind of conversations with people that need the coverage so bad and have had losses, but it has the information that we need to provide assistance through our affordability proposal and so appreciate the committees attention to that recommendation. So, you know, i leave with this. What i do notice if even when my folks do have some sort of insurance, i have to call, and i personally call, and i would recommend my colleagues to use the power of your office to call these Insurance Companies that deny claims. I, it infuriates me when i have to to pick up the phone or use my letterhead to say, hey, heres all the things my residents submitted. Theres nothing you all can do many regards to whats happening there . My residents are paying into a system, and heir not getting there absolutely is something we can do and, in fact, Congress Also look steps to do something when we created the office of the Flood Insurance advocate for those who are having a difficult time working their way through the program. They have that means. So in addition to your having add another what you indicated you do with your letterhead, also you can send them, point them to the office of Flood Insurance advocate at fema to the help hem. But back to some of the earlier conversations well, gentlewomans time has expired. Maybe you could get that in writing. I will now turn to the gentleman new york. Thank you, mr. Chairman. Superstorm sandy was one of with biggest Natural Disasters in u. S. History. While it was ecically no longer a technically no longer a hurricane by the time it reached the cost of long island, tides risked 56 feet in my district. My constituents are keenly aware of affordable Flood Insurance, however, since the implementation just under 4 million americans have seen their premiums increase. Many individual household rates have more than doubled since launch of the new risk rating 2. 0. Youve gone on record saying itsing wit bling and adaptable itsing wit bl and adaptable. However, these comments seem to be many in direct contrast with recent comments by secretary pie your cat during his mayorkas during his most recent appearance. He said dhs is reviewing and needs to continue to review the risk rating 2. 0 given the concerns that have been expressed. To me, it sounds as if the methodology for setting Flood Insurance premiums needs more tweaking than initially expected. From the outside looking in, there seems to be a clear can keys connect between now and thu and the secretary. Is fema or khs currently dhs currently reviewing the determination of risk, is and if so, can you provide an explanation of what is exactly being reevaluated . Thank you. So i actually have been in conversation with the secretarys office, and there is no they continue to be as supportive of risk rating 2. 0 as when he issued the statement on april 1st of 2022 in support of the changes. The only report that im aware of underway, the gao is currently reviewing the risk rating 2. 0, ask is were and were cooperating fully with them. And i think that report will be coming out in the next couple of months. Okay. Well, i just, i think you should check with the secretary, because with last week in front of the committee he said dhs is reviewing and needs to continue to review risk rating 2. 0. What ive seen what happened with a lot of constituents and their policies under risk rating 2. 0, i think it needs reare viewed and reviewed and possibly changed. So i think i understand what he said last year or in support of but what he said last week is different. So one competent ill make before i comment ill make, this is a topic ive been watching closely, and identify been working closely with leader scalise on it. I appreciate his leadership on the issue and hope that we all can Work Together to insure that the u. S. Flood Insurance Market is stable ask affordable for all americans and particularly those on a fixed income. And i want to ask you, to my colleagues question, he asked about and you talked about how if managers wrong with the premiums or if a homeowner thinks their premiums too high, they can go to their agent and possibly get it fixed. I believe 93 of insurance policies, Flood Insurance policies are written under an nfip. And i also a heard from my constituents, one thing i keep hearing is on long island theyve taken steps to mitigate flood whether its raising their house or other structural changes, but hose changes are not are reflected in their monthly premium. I asked one of witnesses about whether there are clear financial benefits for policyholders who have mitigated these features, and the answer created more uncertainty. We were told the challenges is, quote, black box rating engine. Is the black box rating engine that is making it nearly impossible for agents and floodplain officials to provide specific guidance to consumers who want to know watt return, what their return on investment or monthly premium is going to be. Ill pose the same question to you, urn risk rating 2. 0, are there clear financial benefits for policyholders who have implemented these mitigation features as it uniquely pertains to the persons monthly premiums . If so, what do those benefits look like . Certainly, theres no question that if policyholders take measures to hit gate their risk either by mitigate their risk either by el elevation of their structure or by moving airconditioning equipment up off the floor, there is a credit for that. And its very clear, and we can provide you some examples of that. Weve had, again back to the rating engine that the i mentioned before, theres been over 100 million quotes are provided through that rating engine, and so people are clearly looking at what the options are within risk rating 2. 0. Gentlemans time has expired. Next we will go to the gentlewoman from colorado, ms. Pettersson. Thank you, mr. Chairman. Im grateful that this committee is focused on a pathway forward to reauthorize the National Flood Insurance Program because this is absolutely critical in colorado. My communities throughout my district experience heavy snow melt or serious storms which can lead potentially to damaging and courageous floods. Dangerous floods. In recent years the ongoing risk of catastrophic wildfires has only compounded challenges coloradohomeowners are facing. As we recover from fire, were seeing communities where the ability to purchase insurance is not even an option. Similar to Flood Insurance though, many homeowners dont realize their typical insurance policy does not cover these catastrophic events until disaster strikes. Improved transparency and clear disclosures of flood and fire danger are necessary to better educate people about tear potential risks when theyre purchasing homes. And and i do hope this Committee Also works on providing tangible support for homeowners who live many communities like mine who are susceptible to wildfires. The postpyre flooding can damage and harm communities for months and even years following a wildfire. How does femas floodafter Fire Campaign seek to the educate homeowners . And are Additional Resources mess to insure that more people actually follow through and purchase Flood Insurance after a wildfire . Yeah. So, i mean, there are many sources of flooding, and youve or articulated a couple that a lot of folks dont think about. Certainly, flood after fire is a huge issue. The circumstances can actually, the ground actually takes more than six years sometimes for the ground to be able to be like it was before, so that flood risk is not only just that next season, but for about five or suggestion seasons afterward. So, yes, we did a flood afterFire Campaign colorado to try to help people understand what their flood risk is, doing similar in other parts of the country, and were going to continue because its vital as one of the themes, of course, is we need to close the Flood Insurance gap. Only 4 of Property Owners in the country have Flood Insurance, and we need to do better than that. And so any help that we can provide you in that regard, we certainly want to provide. Great. And then do you actually target it specifically to communities for your Awareness Campaign around potential flooding and the options for Flood Insurance to those communities that have been affected specifically . And do you do it after every wildfire, or how does that work . We dont do it after every wildfire, but we cowork with state insurance commissionerses, different state insurance organizations in those situations where we have flood after fire. We do some targeted outreach as we did in colorado. Of we dont do it after every flood, after every wildfire. It seems like our offices could help support our constituents with information like that when, unfortunately, things like this are inevitable in communities like colorado. Another question that i have is currently the floodrelated Disclosure Requirements are set at the state level and neither renters nor homeowners may be aware of the flood risk to a particular property. The requirement to obtain and maintain Flood Insurance following Disaster Assistance or previous floods. Do you think federallyrequired flood disclosures would be a helpful tool for consumers especially for renters to understand their risk and the availability of fair and affordable Flood Insurance coverage through nfipsome the. Absolutely do. And one with of our 17 recommendations, in fact, would create such a uniform standard throughout the anticipates and territories. The states and territories. Great. Thank you so much. I yield back9. Gentlewoman yields back. Were jumping around here. Weve got members that are voting, but the gentleman from nevada is next. Thank you, mr. Chairman. While i appreciate that were continuing the important discussion around the National Flood Insurance Program and the importance of its reauthorization with a long term reauthorization, i do have to say that i wish we were better using the teem of in this sub the time the of this subcommittee to really focus on the pressing issues that our constituents really need us to address including the Housing Affordability crisis that is crippling our country. At a time when Sales Volumes remain yes, sirred, pending listings are down 23 from last year and the average household spends 31 of their income on mortgage or rent, Congress Needs to act. My constituents are struggling to find a way to put and maintain a roof over their head, and that should be the first concern for this subcommittee. I know under the leadership of the democratic majority that was the priority. So i want to know, where is the housing on our agenda . If when are we going to have a hearing on Housing Affordability . We entered this congress four months ago in the midst of a housing shortage, and it is onld since then. While i understand that we have to cover a hole host of issues and topics a whole host of issues and topics, todays housing crisis is simply too consequential for me to remain silent. We are nearly 14 million homes short of the aggregate demand, and this lack of supply is driving housing costs through the roof. Im told stories, painful stories from constituents in my district who are struggling to be able to afford rent or to buy a home. However, from what ive seen, theres only one approach coming from the other side. And thats to slash the federal housing budget. Putting millions more of our people, our constituents at risk of losing their homes and doing nothing to incentivize new construction. This is a nationwide crisis. And, again, i ask the majority on the other side of the aisle, where is the plan on housingsome when will we have a hearing . This is the subcommittee on housing, so i would ask the majority, when will we have a hearing. I also want to ask the majority when you will work with me on the bill that ive introduced on the housing oversight and mitigation explore ployation exploitation act, the home act, so protect the limited supply of housing that we have and to the protect everyday nevadans from being exploited by out of state corporate peck laters who are driving speculators who are driving up the price of housing. These massive corporations and investors have been outbudding my constituents outbidding my constituents everywhere we look. And far too often the homes, these nonout investors purchass purchase will never resurface on the market. Tease homes should be going to the individuals who live in our communities, and instead they are taken off the market to pad the pockets of wealthy wall street hedge funds. While reports continue to come in that these corporate speculators predominantly target neighborhoods of color and single moms, my bill, the home act, will give hud the tools ned to necessary to the investigate these allegations. Not only will hud be able to the collect the necessary data on who these speculators are targeting, but it also gives hud the tools necessary to the insure that we have a level Playing Field in the housing market. So id encourage my colleagues on this committee to look at this bill, h. R. 702, so that we can advance serious policy on a serious issue. Id also encourage everyone to come to e my district and to the hear from e my constituents about the pain associated with the lack of Affordable Housing options. Actually, since the issue excuse me. Since this issue is so pressing in my district, i am bringing together the tri caucus, the black, hispanic, Asian American Pacific Islander caucus on may 8th. Were working hard every day to crease the issues that matter to address the issues that a matter most to our communities, and if anyone wants to deliver real resultses for our communities, then i welcome you to join us this in this work. This is the priority that in this subcommittee and the full committee should be focused on. I would ask the majority to, please, make Housing Affordability the priority a that it deserves. That is what this committee should be charged with while we reauthorize Flood Insurance for the next ten years w. That, i yield back. Gentlemans time has expired. Were going to, were going to the make a change in the chair, and then were going to go vote. Okay. Were going to have the committee recess, and then we will have the committee reconvene once we have members in place. So brief recess. [inaudible conversations] [inaudible conversations]