The National Flood Insurance Program (NFIP) will expire at the end of the month. For anyone that has read the newspaper lately, this is a lousy time for the program to expire with two hurricanes bearing down on the Eastern seaboard, and Texas’ largest city recovering from a 100-year storm. But politically, it is a wonderful time for the program to expire. First, there are suddenly many members of Congress motivated to ensure it doesn’t expire. Secondly, the risk of flood, and the shortfalls of the program, are fresh in our minds as we consider changes that might be made to the program as part of the reauthorization. While what will happen is still akin to a drinking game with people placing bets, here’s what we currently know.

A “Members Only” meeting was held on the House side on Thursday. No, this does not refer to the jackets and clothing line so popular in the 80s. Rather, it is a meeting hosted for Members of Congress and their staff to discuss an issue and (in this case) brainstorm on solutions. Today’s meeting was hosted by Maxine Waters, the ranking Democrat on the House Financial Services Committee, the House Committee with oversight over the NFIP. While the meeting was hosted by the minority party, it was a bipartisan meeting and was attended by some Republicans from flood-prone states. From that meeting, here are some of the things we understand are being discussed:

  1. It seems highly likely that Congress will pass a three-month extension. This is designed to punt the issues to a time of year when Congress has a bit more time (Christmas?) and give Congress time to develop a plan.
  2. Interesting ideas are being thrown around about the NFIP debt. Should Congress forgive the NFIP’s more than $20 billion in debt? (Not likely by the conservative Republican Members.) Should the debt be moved out of the NFIP and into FEMA’s general ledger or to some other agency as a reflection of catastrophic disaster relief as opposed to normal payments under the NFIP?
  3. Perhaps the NFIP should be expanded to include other national disasters such as earthquake and wildfire and mudslides and certain professional sports franchises.
  4. What can be done now for the folks suffering in Houston and (potentially) Florida and the mid-Atlantic states through some modifications to the program?

While none of that is very detailed, we think we will see a three-month extension before the end of the month, and then the hard work can begin. Of course, we don’t yet know if anyone will show up for work that day.

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