Senate Passes Four-Month Flood Insurance Program Extension; President to Sign

Just hours before the National Flood Insurance Program was set to expire–again–the Senate approved a four-month extension that will keep the program alive through Nov. 30.

President Trump said he would sign the extension–which previously passed the House last week–giving lawmakers, the real estate/mortgage industry and homeowners some breathing room to yet again work on a longer-term NFIP extension.

The 86-12 Senate vote came after Sen. Mike Lee, R-Utah, who in a floor speech last week called the NFIP a “dysfunctional program,” agreed to the extension following assurances from Senate Majority Leader Mitch McConnell, R-Ky., to work with Lee and other Senate conservatives on reforms to the program, which is underfunded by nearly $20 billion (the House vote (366-52) overcame similar objections from conservatives, including a series of proposed amendments from House Financial Services Committee Chairman Jeb Hensarling, R-Texas).

The Mortgage Bankers Association has long-advocated for NFIP legislation that provides a long-term reauthorization of the NFIP; an exemption for commercial and multifamily properties from the program’s mandatory purchase requirements; and development of a more robust private flood insurance market. MBA President and CEO David H. Stevens, CMB, issued a statement commending the Senate vote.

“This will protect residential and commercial real estate markets from potential harm, and provide stability for those that sell and administer the policies to millions of Americans,” Stevens said. “MBA now calls on Congress to negotiate a long-term reauthorization of the NFIP which provides certainty and protections for consumers, expands the private flood insurance market, and exempts commercial/multifamily properties from NFIP mandatory purchase requirements.”

The vote avoided another lapse of the NFIP, which could have been particularly problematic during the height of hurricane season, potentially leaving millions of Americans at risk and result in severe disruption in more than 20,000 communities nationwide.

Last week, MBA sent a letter of support ahead of the House vote; it also joined nearly two dozen industry trade groups urging action before the July 31 deadline. Additionally, last week the MBA grassroots advocacy arm, the Mortgage Action Alliance, issued a Call to Action, urging its members to call their elected officials to vote on a long-term reauthorization.