SEMINOLE — A capacity crowd filled a 500-seat auditorium Wednesday night seeking answers about a burgeoning flood insurance crisis that threatens to spike rates for some in Tampa Bay and dampen real estate values for many more.
Speaker after speaker assured frustrated property owners in the audience they are not alone.
"There's this common perception of this being a beach problem," Pinellas Property Appraiser Pam Dubov told the gathering at St. Petersburg College's Seminole campus. "This is our whole community's problem. It's our whole community's economy that's affected."
Robin Sollie, president of the Tampa Bay Beaches Chamber of Commerce and one of the event organizers, noted the impact could be equally devastating for small businesses.
And barring Congressional action, the situation will worsen in a year, said Jacob Holehouse of Holehouse Insurance. People who are placed into a different flood zone then could be forced to pay market rates. That means roughly a third of the county could be at risk of sharp rate hikes.
The focus of the crowd's ire could be summed up in two words: Biggert Waters.
Congress passed the Biggert-Waters Act in 2012 to try to keep the National Flood Insurance Program solvent after Hurricanes Katrina and Sandy left it $18 billion in the red. The path to solvency meant phasing out subsidies that have kept flood insurance rates artificially low for older properties in flood zones.
For most affected homeowners and businesses, increases will be phased in at roughly 20 to 25 percent a year. However, for policies that lapse or homes sold after July 2012, the subsidy goes away entirely come Tuesday.
That means, upon renewal, someone who bought a home with subsidized flood insurance in the past year could see premiums jump fivefold or more.
Rangel Dockery, a St. Petersburg elementary school teacher, is among those in that boat. She and her husband bought a home near the Treasure Island bridge in June. She didn't know her property's subsidized flood insurance rates would vanish after Oct. 1, driving her annual premiums from $1,900 to the $14,000 range.
"We live paycheck to paycheck like most people," she said. "This estimated $12,000 more a year — I don't know what we'll do."
Like others, she's looking for a solution, perhaps a delay or gradual, phased-in higher rates.
"It was always our dream to have a house on the water," said Dockery, 51. "We finally went out of our box and, boy, are we kicking ourselves."
On the commercial side, Eckerd College vice president Lisa Mets wondered how campus buildings will fare under the new structure. One idea being floated, she said, is raising property deductibles from $5,000 to $50,000. But Mets wants to learn more before acting. "We've been devouring everything we can read and attending all the forums we can," she said.
Wednesday's seminar had a two-fold purpose: to inform property owners about what they may face and to propel political action with the higher-rate deadline less than a week away. Pinellas County has more than 50,000 subsidized policies, more than any county in the nation.
Audience members were directed to submit questions on cards. Among more than a dozen read aloud, the crowd reacted most over the issue of why no one told them about the impact of Biggert-Waters a year ago. Shouldn't real estate agents have warned buyers that their flood insurance rates could zoom beyond $10,000 if they happened to buy a subsidized property?
Doug Swain, a Realtor on St. Pete Beach, said that's partly because agents didn't know specifics about the impact until the last couple of months. Describing himself as a "glass half-full guy," Swain said he also anticipated that the most jarring parts of the law would never take place.
"I thought, 'There will be something in the 11th hour,' " Swain said. "That didn't happen."
Beyond hitting property owners hard with higher premiums, the law threatens to cripple real estate sales in flood-prone neighborhoods. Some bay area Realtors say it's already happening.
"If you talk to any real estate agent right now with properties in flood zones, the action has literally come to a screeching halt," said Eileen Bedinghaus, a ReMax Realtor in St. Petersburg. "It's been devastating."
She blamed Washington politicians for not caring.
"We will bail out huge banks when they make big mistakes," she said. "Here, we haven't done anything wrong, haven't done anything criminal. And they're not going to help us out? It's absolutely sinful."
Sen. Bill Nelson and several U.S. House members from Florida are pushing for a delay, though they say it's an uphill battle. The loss of subsidies has an outsized impact on only a handful of states — most notably Florida and Louisiana — and many in Congress have little incentive to revisit Biggert-Waters.
Advocates of higher flood rates also have regrouped, saying Biggert-Waters is the best way to keep the flood program solvent.
The Union of Concerned Scientists, in a media conference call Tuesday, said the rate increases have been foreshadowed for more than a year and delaying them would be a mistake. It contended the impact of lost insurance subsidies is minimal compared to the imminent danger of increased flooding from global warming.
"The rising seas will not wait for us," said Rachel Cleetus, a UCS senior climate economist who authored the recent report "Overwhelming Risk: Rethinking Flood Insurance in a World of Rising Seas."
"The problem here is we've ignored this far too long," Cleetus said, saying subsidized rates only encourage coastal development and put other property owners at risk to pay for a catastrophe. "The true risk is coming from sea level rise and coastal storm surge."
Sollie, the local beaches chamber president, remained resolute that Congress could still change its mind as political pressure grows. "It's building momentum. Absolutely," she said.
Jeff Harrington can be reached at (727) 893-8242 or [email protected]