Key Takeaways
- •Rep. Mike Flood (R, NE-1) highlighted that unmitigated multiple loss properties constitute only 2.5 percent of NFIP policies but account for a staggering 48 percent of all program claims.
- •Alicia Puente Cackley (Director, Financial Markets and Community Investment, U.S. Government Accountability Office) testified that a $26.7 billion premium shortfall is projected by 2037 because rates remain below full risk.
- •Rep. Mike Flood (R, NE-1) pressed Steve Ellis (President, Taxpayers for Common Sense) on why homeowners remain in flood-prone areas, with Ellis citing slow, complex federal buyout processes.
- •Rep. Ayanna Pressley (D, MA-7) argued that systemic redlining forced low-income families into flood zones, while Rep. John Rose (R, TN-6) advocated for removing chronic loss properties from coverage.
- •This hearing informs the upcoming National Flood Insurance Program reauthorization as Congress weighs debt forgiveness, Risk Rating 2.0 implementation, and new mandates for property-level mitigation and voluntary buyouts.
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Hearing Analysis
Overview
This hearing examined the financial instability of the National Flood Insurance Program (NFIP) and the disproportionate impact of multiple loss properties on its growing debt. With the NFIP currently owing $22.5 billion to the Treasury, the discussion focused on the effectiveness of federal mitigation strategies—such as property acquisitions, elevations, and floodproofing—and the challenges of transitioning to actuarial risk-based pricing. Members and witnesses explored how to balance the need for fiscal solvency with the necessity of maintaining affordable coverage for low-income and frontline communities facing escalating climate risks.
Key Testimony & Policy
Witnesses highlighted a stark disparity in the NFIP: while unmitigated multiple loss properties make up only about 2.5 percent of policies, they account for nearly half of all claims. Dr. Alicia Puente Cackley of the U.S. Government Accountability Office (GAO) testified that the NFIP remains financially unsound because premium rates do not fully reflect actual flood risk, leading to a projected $26.7 billion shortfall by 2037. She recommended that Congress authorize means-based assistance for low-income policyholders rather than suppressing rates across the board. Dr. Diane Horn of the Congressional Research Service (CRS) noted that while mitigation funding has increased since 2018, it is being outpaced by rising property values and more intense storm patterns.
Several specific legislative proposals were discussed to address these structural failures. Rep. Andrew Garbarino (R, NY-2) highlighted his Community Flood Resilience Act, which would utilize parametric insurance to trigger faster payouts based on measurable thresholds like rainfall. Rep. Nikema Williams (D, GA-5) and Rep. Troy Downing (R, MT-2) discussed the Whole Home Repairs Act, a bipartisan bill aimed at providing flexible grants for pre-disaster repairs. Additionally, Rep. Janelle Bynum (D, OR-5) introduced the Floodplain Enhancement Recovery Act to exempt low-risk ecosystem restoration projects from costly and outdated FEMA mapping requirements.
Joel Scata of the Natural Resources Defense Council (NRDC) criticized the current pace of mitigation, noting that it can take over five years to complete a FEMA-funded buyout. He urged Congress to allow NFIP funds to be used directly for buyouts and to update building standards that have not been revised since the 1970s. Steve Ellis of Taxpayers for Common Sense advocated for the full implementation of Risk Rating 2.0 to communicate true risk through pricing, while Samantha Medlock of Climate Risk Advisors called for the total forgiveness of the NFIP’s $20 billion debt to allow the program to reset with a rational pricing structure.
Notable Exchanges & Partisan Dynamics
The hearing featured a sharp divide over the role of the executive branch and the causes of the insurance crisis. Ranking Member Ayanna Pressley (D, MA-7) and Ranking Member Maxine Waters (D, CA-43) accused the Trump administration of "dismantling" FEMA and ignoring climate change, which they argued exacerbates the vulnerability of redlined and low-income communities. Rep. Waters specifically called for the removal of the President, asserting that his administration’s policies favor private interests over public safety.
Conversely, Republican members focused on fiscal responsibility and state-level accountability. Chairman Mike Flood (R, NE-1) and Rep. John Rose (R, TN-6) expressed concern that the NFIP acts as an "open-ended ATM" for chronic loss properties, such as a Virginia Beach home that flooded 52 times. Rep. Rose supported a proposal to bar newly designated severe repetitive loss properties from the program entirely to protect taxpayers. Rep. J. Hill (R, AR-2) questioned why federal taxpayers should continue to subsidize local jurisdictions that approve high-risk developments for the sake of property tax revenue, suggesting that "Uncle Sam shouldn't be Uncle Sugar."
Regional concerns also surfaced, with Rep. Rashida Tlaib (D, MI-12) highlighting that FEMA’s current policies often exclude basement flooding, leaving Midwestern homeowners in "disrepair" and facing mold toxins after record rainfalls that do not fit traditional coastal flood models.
Organizations Mentioned
* **Federal Emergency Management Agency (FEMA):** The primary agency discussed regarding its management of the NFIP, its "outdated" flood maps, and the slow pace of its buyout and mitigation grant programs. * **U.S. Government Accountability Office (GAO):** Cited for its reports on NFIP insolvency and its recommendations for means-tested assistance and improved property acquisition processes. * **Taxpayers for Common Sense (TCS):** Represented by witness Steve Ellis, who advocated for risk-based pricing and protecting federal taxpayers from repetitive loss claims. * **Natural Resources Defense Council (NRDC):** Represented by witness Joel Scata, who pushed for stronger building standards and the inclusion of future climate conditions in flood mapping. * **National Oceanic and Atmospheric Administration (NOAA):** Mentioned regarding its "billion-dollar database" and its role in tracking the increasing costs and frequency of natural disasters. * **Department of Housing and Urban Development (HUD):** Discussed in the context of CDBG-DR funding, which provides critical recovery and mitigation resources to states and localities. * **Congressional Research Service (CRS):** Provided expert analysis on the gap between mitigation funding and the escalating risks driven by population growth and climate change. * **National Transportation Safety Board (NTSB):** Used as a model by Steve Ellis for a proposed "National Disaster Safety Board" to investigate and learn from major flood failures.
What's Next
The subcommittee will continue to evaluate the long-term reauthorization of the NFIP, with several members calling for a 10-year extension to provide market stability. The GAO is expected to release a comprehensive report later this year on the "flood insurance protection gap," which will examine why many at-risk homeowners remain uninsured. Future legislative action is expected on the Community Flood Resilience Act and the Whole Home Repairs Act as the committee seeks to integrate public-private partnerships and pre-disaster mitigation into the NFIP framework.
Transcript
The Subcommittee on Housing and Insurance will come to order. Without objection, the chair is authorized to declare a recess of the committee at any time. This hearing is titled Mitigation and Multiple Loss Properties: Factors Influencing the High Cost of Flooding. Without objection, all members will have five legislative days within which to submit extraneous materials to the chair for inclusion in the record. I now recognize myself for four minutes for an opening statement. I'd like to thank our witnesses for being with us today, and I very much look forward to an important discussion focused on the National Flood Insurance Program with special emphasis on mitigation efforts and multiple loss properties. The National Flood Insurance Program, or NFIP, was established in 1968 in response to repeated flood disasters that resulted in the need for federal disaster relief. At the time, Congress felt the NFIP could make flood insurance coverage more widely available at reasonable terms for those who needed it. NFIP is the primary source of flood insurance coverage for residential properties across the country. The NFIP is managed by FEMA. It's primarily funded through premiums from policyholders, but premiums charged by the program often do not fully reflect the real flood risk. When premiums from the National Flood Insurance Fund are insufficient to pay claims, the program has authority to borrow from the Treasury. For most of its history, the NFIP borrowed relatively little from the Treasury. However, after a very destructive hurricane season in 2005, Congress increased the borrowing limit for the program to roughly 20 billion to pay claims. Then after Hurricane Sandy in 2012, Congress increased that borrowing limit again to 30.425 billion. The NFIP has continued to accrue debt in the years that have followed. Most recently, the program borrowed 2 billion in additional funds in February 2025, bringing the program's current debt to 22.525 billion. That leaves just 7.9 billion more in borrowing authority before the program has reached its borrowing cap. In order to appreciate what is driving the increasing debt for this program, we need to better understand what is driving the risk within the flood insurance program. During this hearing, we have witnesses prepared to speak on two important factors that affect the program's financial health: multiple loss properties and mitigation. Multiple loss properties are properties that flood repeatedly, often costing NFIP and taxpayers significant money. According to the GAO, as of 2021, unmitigated multiple loss properties made up about 2.5 percent of all NFIP policies but 48 percent of NFIP claims. We can find some public reporting that tells the story of these properties that repeatedly flood. For example, the Washington Post reported in 2024 that one property in Virginia Beach has flooded an astounding 52 times, including four floods in 2020, two in 2021. The property received payments totaling around 784,000 from the program. I'd like to submit that into the record without objection. The mismatch between the number of these repetitive loss properties covered by the NFIP and the amount of claims paid out to those homes demonstrates a significant structural challenge for the program. While multiple loss properties constitute a significant driver of insurance claims, mitigation is a potential means of limiting flood damage across the country. Methods of mitigation can vary, but in general, there are four main strategies for mitigating risk: acquisition, elevation, relocation, floodproofing. All of these mitigation tactics can be used to limit flood losses in areas that are otherwise prone to flooding. Any conversation about the future of NFIP will naturally feature some differences of opinion based on regional divides, and that's okay. Whether you're from an area that floods frequently or one that floods rarely, we all have a unified set of goals, and those are we need to abate the flood risk. High flooding risk means more damages for homeowners and more claims and debt is added to the already severely indebted NFIP. And with that, I yield back. I now recognize the ranking member of the subcommittee, Miss Pressley, for four minutes for an opening statement.
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