Flood Insurance Increases Vex NJ Homeowners [AUDIO]
Some homeowners could be between a proverbial rock and a hard place as they face rising premiums once federal flood insurance subsidies come to a close.
During a public meeting in Brick Township Thursday, U.S. Sen. Robert Menendez (D-NJ) pushed for his bill which would delay the incremental premium increases of the Biggert-Waters Act, while FEMA conducts an affordability study and re-evaluates the flood zones.
"Some of these increases will be modest, some of them will be prohibitively expensive and act as a de facto eviction notice for homeowners," Menendez said.
The Biggert-Waters Act, which was passed before Superstorm Sandy hit, removed many subsidies from the Federal Flood Insurance Program as a way to make the program solvent. The increases were to be implemented incrementally each year; however, many homeowners found themselves paying annual premiums upwards of $10,000 under the bill.
"Twenty-five percent of $13,000, when you were paying $800, is still a very significant occurrence," said Menendez of the Biggert-Waters Act.
Point Pleasant Beach resident Peggy Malloy's home was spared Sandy's wrath, but the mother of two still finds herself facing significantly larger premiums. It would cost Malloy close to $100,000 to elevate her home to be within compliance of the base flood elevation maps. With no equity in her home, she said, that isn't feasible. Malloy also said selling isn't an option.
"The new owner would have to assume the maximum flood insurance premium if they bought my house before I mitigate this issue," Malloy said. "There is no equity. My house, I've been told, is worth the land that it sits on."
Without any options, Malloy said her only option at the moment is to stop paying the mortgage on her home.
"So at a time when we should be looking at 'what are we going to do, where are we going to retire, what's our future?' we're looking at 'how do we start over, and how do we start over with nothing?'" Malloy said.
Menendez's bill still needs Congressional approval. It awaits a Senate vote later this month.