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Washington Beat: Bill to Stop Flood Insurance Rate Hikes Faces Numerous Obstacles

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TWC News: Washington Beat: Bill to Stop Flood Insurance Rate Hikes Faces Numerous Obstacles
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Lawmakers in both chambers of Congress are vowing to move forward on legislation that will stop new flood insurance rates from kicking in, but the bill faces numerous obstacles. Washington bureau reporter Michael Scotto filed the following report for NY1.

WASHINGTON, D.C. The debate over unemployment benefits is sucking up much of the political oxygen on Capitol Hill, but lawmakers say once that fight is resolved, they will turn their attention to another issue that has the potential to make or break a family's finances.

Earlier in the week, senators gathered to push for legislation that would temporarily stop flood insurance rates from going up on primary homes.

The higher premiums are the result of a law that phases out subsidies and puts premiums in line with risk.

Lawmakers from across the country say the new rates are unaffordable, but that has not been enough to make legislation a slam dunk in Congress. Even if it makes it out of the Senate, it faces an uncertain future in the House.

Opponents say that flood insurance rates must increase in order to save the financially shaky flood insurance program. In fact, the Congressional Budget Office estimates that delaying the rate hike would cost $900 million over five years.

"Taxpayers have been bearing the burden of this program for too long, and it's time for people who are the beneficiaries to pick up their fair share," said Steve Ellis of Taxpayers for Common Sense.

That's also the view of a number of Republican lawmakers. In a statement, a spokesman for the chairman of the House committee that oversees the flood insurance program said, "Any reform to the program must ensure we don't make a bankrupt program even more bankrupt and saddle future generations with more unsustainable debt."

Rep. Michael Grimm, who is behind efforts to halt the rate hikes, said that he has proposed paying for the delay by imposing a $33 fee on people in the flood insurance program. The idea hasn't sold his Republican leadership.

"I'm hoping that the chairman is just going to re-evaluate it and that Eric Cantor is going to look at this and realize, with the Senate hopefully having an overwhelming vote in favor of it, that we'll have to move this," he said.

For now, it's unclear if that will happen.

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