WASHINGTON — President Barack Obama on Friday signed into law the Homeowner Flood Insurance Affordability Act of 2014, officially undoing changes Congress made less than two years ago that drove up insurance rates in Florida and other states.
"A lot of hard work and passion from members of both parties contributed to this victory," said Rep. Vern Buchanan, R-Sarasota.
The measure eliminates a provision of a 2012 law that said government-subsidized rates disappear when a person sells a primary home; provides a refund for those who already got hit under that provision; and maintains protections due to sunset for "grandfathered" properties built to code after a community adopted its first Flood Insurance Rate Map.
The Federal Emergency Management Agency can still impose premium increases on homes built before those maps. But the increases will range between 5 percent and 15 percent on average, with a hard cap of 18 percent per year until reaching actuarial risk.
Owners of grandfathered second homes and commercial property also will be spared, but older properties of the same type built before the Flood Insurance Rate Maps are not covered by the law and could face big increases.
The 2012 legislation, known informally as Biggert-Waters, passed Congress with wide support. It forced higher insurance rates to reflect true risk and shore up the National Flood Insurance Program, which is more than $24 billion in the red. But outcry from property owners sent lawmakers scrambling to fix the problem.
Rep. Kathy Castor, D-Tampa, said, "We will continue to hold FEMA accountable for its process of updating of flood maps so property owners are not stuck with overnight, arbitrary insurance premium increases that could possibly force families out of their homes and harm our businesses."