Cardoza plan removes category for flood insurance - Local ...

WASHINGTON -- Some Central Valley residents could catch a couple of breaks under flood insurance amendments agreed to Tuesday by the House.

By a 261-163 vote, the House accepted a plan by Rep. Dennis Cardoza, D-Merced, that removes a new category of "residual risk" regions that otherwise might have been subjected to flood insurance requirements.

The residual risk regions would have extended to areas that are covered by levees or dams but that are not part of a designated 100-year flood plain. Stockton and San Joaquin County officials, in particular, had raised alarms about the proposed new requirement.

"Large parts of the Central Valley, Los Angeles, and Orange Counties are protected by existing levees and have no history of flooding but would find themselves in newly designated residual risk flood plains under (the law)," Cardoza warned.

But lawmakers who wanted to retain the new residual risk designations as part of the National Flood Insurance Program warned that homeowners might end up the losers.

"This would weaken the new standards that would give homeowners an (assessment) of flood risk," said Rep. Judy Biggert, R-Ill.

The House nonetheless accepted Cardoza's amendment as part of a larger National Flood Insurance Program rewrite. The underlying legislation attempts to reform the national flood insurance program, which is nearly $18 billion in the red.

Citing the money losses, some conservative Republicans tried and failed Tuesday to eliminate the flood insurance program altogether.

The bill is the first major rewrite of the flood insurance program since 2004. Last year, the program paid out $709 million to homeowners, business owners and renters; unlike in some past years, California did not rank among the top 10 states for payouts.

As part of the House bill, lawmakers also accepted by voice vote an amendment by Rep. Doris Matsui, D-Sacramento, that aids homeowners in newly designated flood plains.

Matsui's provision phases in the higher insurance premiums facing homeowners in the flood plains designated since 2008. Although the provision applies throughout California and nationwide, one of its biggest impacts will be to cover an estimated 25,000 homeowners in Sacramento's Natomas region.

Currently, the residents pay a $350 annual premium, which is scheduled to rise to $1,350 in 2013. Under Matsui's amendment, this increase will be stretched out over five years starting in 2013.

"I believe this to be a fair and equitable way forward, particularly in these trying economic times," Matsui said.

Other legislative language championed by Rep. Devin Nunes, R-Visalia, and included in the bill is supposed to make it easier for private insurance companies to offer flood insurance.

The House and Senate must still reconcile their versions of the flood insurance bill.

Source: http://www.mercedsunstar.com/2011/07/13/1967442/cardoza-plan-removes-category.html

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