Page 14 - The Long Road Home

FUNDING THE RECOVERY Funding the recovery has proved an
of Hurricane Betsy, which caused billions in damage along the Gulf Coast, federal mortgage programs and banks soon required that all properties in designated flood zones carry NFIP insurance in order to qualify for a mortgage. The NFIP is similar to other insurance programs: homeowners pay premiums and the insurer – in this case the federal government – pays out claims after a flood. Under the Reagan administration, the NFIP began the “Write Your Own” (WYO) program, which shifted a portion of the supervision of policies to private insurers. Under WYO, private insurers draft
policies and handle payouts using federal funds, not their own, while taking a 30 percent premium fee for administering the policies.
Many Sandy-impacted families quickly found their NFIP flood insurance settlements lower than they expected or believed they were covered for. In an October 2014 federal lawsuit in New York, a Sandy-impacted family demonstrated that an engineering report had been altered to suggest that Sandy wasn’t responsible for the bulk of the damage. Problems like this and years of other complaints, errors, and lawsuits
Photo: Ray Fisk, Down the Shore Publishing
ongoing challenge, both for individual families and for the state of New Jersey. The Federal Emergency Management Agency (FEMA) was first on the ground immediately after Sandy, providing emergency aid, loans, and, through the NFIP, flood insurance claims payments. For individuals and households, FEMA’s role is to provide financial assistance regarding housing and disaster-related expenses. One of FEMA’s sources of relief funding comes through the Small Business Administration (SBA) loan program. These low interest loans, often at rates of less than three percent, can be a major help and lifeline to families. However, SBA loans can affect eligibility for grants and other forms of assistance that become available later in the recovery.9
Another primary source of funds for rebuilding after a storm is the NFIP, housed within FEMA. Passed into law in 1968 in the aftermath
I don’t even know where to begin. It’s a horribly run program and I’m still trying to navigate
it. It’s caused me a lot of stress and anxiety. Sometimes I wonder if it’s all worth it.
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