Flood Insurance Program Stall in Congress

Despite promising changes, Congress has shown little enthusiasm for taking the unpopular steps that experts say are necessary to fix the nation's main flood insurance program. Recent flooding in the Midwest has brought the issue back to the forefront. Hurricanes Katrina and Rita, back-to-back storms in 2005, dispelled any notion that the insurance program was self-sustaining. They threw it roughly $20 billion into debt and called attention to major structural flaws.

Nearly everyone acknowledges it cannot pay off the debt, much less pay for losses in future storms. But so far, Congress has done little more than raise the program's borrowing limit, essentially handing taxpayers a series of shaky IOUs. A failure to act could leave the public vulnerable to large bailouts of the program and help perpetuate a false confidence among some property owners that they do not need coverage.