Friday, November 29, 2013
Pawleys Island mayor Bill Otis is urging all coastal property owners to contact senators and congressmen immediately about pending legislation called the Biggert-Waters FEMA Reform Act to save money on federal flood insurance.
The Biggert-Waters Flood Insurance Reform Act of 2012 is a law passed by Congress and signed by the President in 2012 that extends the National Flood Insurance Program (NFIP) for five years, while requiring significant program reform.
It calls for changes to the National Flood Insurance Program to make it more sustainable. The changes include the elimination of long-standing subsidies
previously available to certain pre-FIRM policyholders.
Otis said the legislation has a potential for large negative impacts on many if not most Pawleys Island property owners by significantly raising their cost for federal flood insurance, Otis wrote in a post card message to property owners.
He said in an interview that all property owners who are required to have federal flood insurance will be affected by this bill.
“We now have copies of the pending legislation in both the U.S. House and the U.S. Senate to put off the provisions of the Act for up to four years,” Otis wrote in the message to island residents.
“And none of them defer any of the costly provisions of the Biggert-Waters FEMA Reform Act that relate to second (non-primary) homes.
Otis recently stated in the town’s newsletter that the rating which earns property owners the 20-percent discount has been retained as a result of a five-year audit of the Towns Community Ratings System (CRS) program.
“Our objective is to retain and improve this rating, and earn our property owners additional discounts,” Otis wrote.
He added that this discount will become more important as the federal government moves to eliminate subsidies on Federal Flood Insurance as a result of the Biggert-Waters Flood Insurance Reform Act.
“We have a number of ‘pre firm’ properties on Pawleys, houses built before March 16, 1989 and not “substantially improved” since that date (remodeled at a cost greater than 50 percent of the market value of the structure), Otis wrote.
“The Federal Flood insurance premiums on these houses will increase to the “non-subsidized” rates at 25 percent per year until the premium reflects the full “non-subsidized” rates, which will be substantially higher than the “pre firm” rates. The premiums will also increase to the “non-subsidized” rates if the house is sold, or if the house is ‘substantially improved’ or ‘substantially damaged.’”
He stated that this will affect every house on Pawleys island, and substantially affect those built before March 16, 1989.
For more information about this legislation, visit www.fema.gov.