FOR IMMEDIATE RELEASE
ICBA Commends U.S. House for Passing Flood Insurance Reform
Washington, D.C. (June 28, 2006)—The Independent Community Bankers of America (ICBA) commends the U.S. House of Representatives for passage of an ICBA-supported measure to rebuild the nation's flood insurance program, the Flood Insurance Reform and Modernization Act (H.R. 4973).
"The House has taken a major step in putting the National Flood Insurance Program back on sound financial footing," said Camden R. Fine, ICBA president and CEO. "ICBA looks forward to working with lawmakers to ensure passage of a measure whereby community banks can identify which properties require flood insurance so that consumers, small businesses and community banks can rebuild in the event of a flood."
The House bill requires the Federal Emergency Management Agency (FEMA) to develop more sophisticated and updated flood maps which will make it easier for lenders to identify which properties require flood insurance. New mapping requirements direct FEMA to include properties located behind levees. The bill would also increase the maximum coverage limit for homes and nonresidential properties.
As the bill moves forward, ICBA asks Congress to reconsider provisions not supported by ICBA that would increase the fines lenders face for failing to enforce the mandatory flood insurance purchase requirement from $350 to $2,000 and raise the annual cap on fines for any single lender from $100,000 to $1,000,000. The House bill also contains an ICBA-supported "good faith" exemption from the fines if a lender made a reasonable attempt to comply with the program's mandatory purchase requirement.
The Senate is expected to consider a separate flood insurance bill in the near future.