From Assemblyman Phil Goldfeder
As our families continue to recover from the devastation caused by Sandy and we continue to put the pieces of our lives and community back together, there seems to be a dark cloud hanging over us. Although much slower than any of us want or expected, we are making progress on rebuilding our homes, implementing beach and bay protections, designing our new boardwalk and improving street and sewer infrastructure. And yet, with recovery seemingly moving in the right direction, every resident still fears that this is an exercise in futility as skyrocketing insurance rates will lead to our ultimate demise.
If you have read the Wave during the last 14 months you should be quite familiar with the Biggert-Waters Flood Insurance Reform Act of 2012. This destructive federal legislation calls on the Federal Emergency Management Agency (FEMA) to make a number of changes to the way the National Flood Insurance Program (NFIP) is run, including, eliminating subsidies and raising rates to reflect true flood risks. The purpose of the new law was to make the NFIP more financially stable, however the unintended consequence will require premium rate increases for many of our families to levels we simply cannot afford.
A good temporary solution was proposed by our New York State Congressional leaders, led by Senator Chuck Schumer and Congressman Gregory Meeks, who drafted new legislation to delay changes to the NFIP. The proposed bill, the Homeowner Flood Insurance Affordability Act, will require FEMA to complete an affordability study and propose real solutions to address flood insurance costs before flood insurance premiums can be raised. This would postpone our fears if it is enacted, however, devastatingly high insurance rates can still be at the end of the tunnel.
Instead of waiting for the federal government, FEMA or the NFIP to take action - I have a solution.
If FEMA and the NFIP do not understand the ramifications of their decisions or truly comprehend what Biggert-Waters will do to our community, I propose we relinquish ourselves from their control. Let’s work within the state or even regionally together with surrounding states, such as New Jersey and Connecticut to create a system that is affordable for working class homeowners in Rockaway. A system that is sustainable to provide the coverage and protection when we need it.
In fact, such a system already exists: The precedent for a New York State Insurance Company was set in the 1960s to deal with fire and now New York State can act to establish an association to deal with flood.
The New York Property Insurance Underwriters Association was created in the 1960s because of the ballooning crime rates and particularly the riots that caused widespread arson and property damage. Due to the high risk, insurance companies shirked their responsibility and stopped offering homeowner coverage in many areas.
Similarly in Florida, after the devastating effects of Hurricane Andrew in 1992, the Citizens Property Insurance Corporation was created to provide both windstorm coverage and general property insurance for homeowners who could not obtain insurance elsewhere.
As a matter of fact, the NFIP, created in 1968, was essentially created when private insurance companies jumped ship on coastal communities and the federal government had to step in to provide relief. The problem however, is that the NFIP has become a bureaucratic nightmare riddled with waste and mismanagement.
What it boils down to is that private insurers do not want to provide flood insurance because the risk is too great. The solution is simple; we can spread the risk and create a system where the cost could be shared. The association would consist of state and city agencies, the numerous private insurance companies and could be subsidized by FEMA with money that they would have spent on NFIP.
A state run program could be the answer that would address all the flaws in the current system and finally provide protection for our families. I have spent the last few months exploring this new state approach to the insurance problem and already started numerous conversations with New York and Florida officials to discuss their currently state run insurance plans.
I must give credit to Kevin Boyle, editor of The Wave, for his outstanding coverage on this issue and his ingenuity when it comes to discovering real potential solutions!
In the coming months, please read about our progress in The Wave. I will continue to be a champion for this solution. Our fate does not have to rest with the federal government. There is too much at stake to sit back and wait and I will do whatever it takes to remove the cloud that is keeping our families in the dark.
Assemblyman Phillip Goldfeder represents Assembly District 23.