Now think back to the Times story about Schumer protesting on behalf of beachfront-owning Long Islanders. To this point, the dominant narrative around the NFIP should be that it is being exploited by the wealthy, be they mansion-owners, real estate developers, or private insurance companies. But in a statement to the Times, a spokesperson from Schumer’s office claimed that “FEMA shouldn’t be rushing to overhaul their process and risk dramatically increasing premiums on middle-class and working-class families without first consulting with Congress.”
In reality, FEMA’s proposed rate hikes, known as Risk Rating 2.0, would have a relatively minimal effect early on, particularly for low-income households. That is by design. In FEMA’s report on the proposed changes, it found that it would “not be able to increase rates faster than the existing limit for primary residences of 5%–18%,” due to the way Congress has drawn up the program. But to ensure that the new insurance rates are drawn up in an equitable fashion, it will no longer consider the flood zones in its calculations—which are currently based on the same models FEMA crafted in the 1970s. Instead, it will calculate the rates “based on the specific features of an individual property.” That means if you own an $8 million, seven-bedroom castle in Montauk, your rates are going to be significantly higher than those of the family living in a $200,000, two-bedroom home in Miami’s Little Haiti neighborhood.
What can, and should, be fixed is the national buyout program, as highlighted by John Oliver on Last Week Tonight in 2017. Not only should developers be blocked by local governments from continuing construction in areas we know will be underwater by the end of the century, but families who want to move out of their homes due to constant flooding should have federal funds made available to them. FEMA has a program for that in place. The problem is, it moves incredibly slowly and, critics say, inefficiently.
All of this, theoretically, could be addressed by changes like FEMA’s Risk Rating 2.0 and a renewed push by federal legislators to expedite the buyout program—actions that are currently being blocked by Congress. Legislators have known for some time that the NFIP has been abused. They’ve even tried to address some of these shortcomings, with predictable results. In 2012, Congress passed the Biggert-Waters Act, a bill initially designed to reauthorize and update the NFIP, the plan being to remove second homes, vacation homes, and businesses from the federal subsidy system. But after lawmakers representing coastal areas were lambasted by the affected home and business owners, the updates and the accompanying rate hikes were delayed for four years.