WASHINGTON – Congress agreed for the third time Wednesday to increase the borrowing power of the federal flood insurance agency, which is running out of money as it tries to meet unprecedented claims from Katrina and other hurricanes last year.
The House separately moved to replenish funds for the Small Business Administration's disaster loan program, which is also going broke as it responds to applications from Gulf Coast homeowners and businesses. A vote on that legislation, which redirects $712 million in FEMA money to the loan disaster program, was expected later in the day.
In a voice vote, the House approved a measure to increase from $18.5 billion to $21.2 billion the amount the National Flood Insurance Program can borrow from the Treasury. The Senate passed the bill last week.
In response to the worst flood disaster in the nation's history, Congress raised agency's borrowing authority from $1.5 billion to $3.5 billion last September, and then to $18.5 billion in November as the NFIP, a part of the Federal Emergency Management Agency, came up short of funds.
The previous record of payouts from a flood disaster was $1.4 billion in 2004 from Hurricane Ivan.
Several lawmakers said they would oppose putting more money into the agency without a legislative overhaul of the system to prevent people from rebuilding on property that suffers repeated flood damage.
"It does not comply with our duties to the taxpayers and the environment," said Rep. Barney Frank, D-Mass., "to simply put more money into the program without further reform."