THE REAL DEAL ON HR 2555:

Legislative Alert:Federal Bailout for Beach Houses Bill gets A Hearing

A bill that would allow a massive federal bailout for beach houses will receive a hearing in Congress this week. The House Financial Services Subcommittee on Housing and Community Opportunity and Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises is scheduled to hold a hearing regarding the Homeowners' Defense Act, H.R. 2555, sponsored by Representative Klein (D-FL) on Wednesday March 10, 2010.

Why SmarterSafer.org Opposes HR 2555:

In advance of the hearing, SmarterSafer.org released a letter to House Financial Services Chairman Barney Frank and Ranking Minority Member Spencer Bachus that opposes the Klein legislation, which would cost taxpayers billions of dollars, discourage the insurance and reinsurance private market, and result in incentives to build in unsafe and environmentally fragile areas. Instead, the letter encourages the passage of several mitigation bills that would better protect homeowners and save taxpayer money.

June 8 Letter to Representatives
Press Release
Read our letter

THE REAL DEAL ON HR 2555

Independent taxpayer and environmental groups have come out strongly against the Klein bill due to the disastrous consequences that would occur if this bill is enacted:

Environmental Groups Come Out Against HR 2555:

"We have no doubt that Representative Klein's efforts to ease Floridians' insurance rates are well intended, but we are extremely concerned that providing a federal insurance subsidy will create incentives for more development in environmentally sensitive coastal areas and increase exposure to hurricane-related risk. This could leave people more exposed to harm and at the same time increase, rather than decrease, adverse impacts to the environment."

Read more

Environmental Groups: Write in opposition to H.R. 2555, due to significant concerns with this legislation and respectfully request deferral of its consideration until other measures are proposed that would better protect people, property, the environment and the interests of taxpayers all across the country.

Taxpayer Groups Don’t Support HR 2555:

For every $1 of funds used to strengthen and protect homes, structures and communities, $4 is saved in post-storm costs. When communities and homes are stronger, there is less damage, disaster assistance, clean up, displacement and rebuilding after a storm.

Read more

THE REAL DEAL ON HR 2555

In addition, insurance groups have come out against the Klein bill.

REINSURANCE ASSOCIATION OF AMERICA

OPPOSES HR 2555:

"HR 2555 provides a reward for state sponsored insurance programs which have failed to adequately collect premiums for their insured property risk for natural catastrophes. It incentivizes other states to replicate this approach. By doing so it would expose the Federal government to financially support states which would "game" the system to transfer the cost of natural disaster insurance to Federal taxpayers instead of funding catastrophe risk by those living in risk prone areas."

Read more