Congress has passed and sent to President Obama legislation thatincreases the borrowing authority for the National Flood InsuranceProgram by one-third.

The House passed the legislation Thursday through expeditedprocedures that required a two-thirds vote; theSenate acted several hours later by unanimous consent.

The House vote was 354-67. All “nay” votes came fromRepublicans, another sign of unrest from conservatives upset thatthe “fiscal cliff” deal approved earlier this week did not call forenough cuts in the federal budget. All 192 House Democrats whovoted supported the bill.

“No” votes included Rep. Paul Ryan (R-Wis.), chairman of theHouse Budget Committee. He told The Hill after the votethat Washington should not be creating new debt.

And, during the debate, other Republicans noted that the NFIPonly takes in about 70 cents of the money it pays out inclaims.

“This legislation proposes to increase the program's borrowingauthority by $9.7 billion,” Ryan said. “It would be irresponsibleto raise an insolvent program's debt ceiling without making thenecessary reforms.”

Rep. Jeb Hensarling (R-Texas), incoming chairman of the HouseFinancial Services Committee, made the same point during thedebate. “For the victims who paid for flood insurance policies withthe National Flood Insurance Program, their claims need to be paid– and paid now.”

But, he said, the NFIP “is beyond broke – it is taxpayer-bailoutbroke.”

He said his committee will mark up a bill this year “totransition to a private, innovative, competitive, sustainable floodinsurance market.”

He said that is needed to ensure that “taxpayer bailouts arenever needed again” and to get NFIP “on a path towards actuarialsoundness.” He acknowledged that some reforms were imposed throughthe NFIP reauthorization legislation enacted in July, but said thatdespite those reforms “Sandy has hit before many of theseprovisions could take effect.”

To defend themselves from the withering attack from Northeastmembers of the Republican caucus, the Republican leadership sentRep. Scott Garrett (R-N.J.), a House Financial Servicessubcommittee chairman, to manage the debate and sponsor thelegislation.

Caught in the middle between seething Republicans who for themost part voted against the legislation averting the fiscal cliff,Garrett urged “volunteers” from across the country to come to NewJersey, New York and other Northeast states hit by Sandy to aidvictims.

But, he acknowledged that, “As someone who has been on theground, viewed the devastation, and helped clean up some of thedamage, I certainly believe that those who have bought floodinsurance should expect to receive the coverage they paid for,”Garrett said.

The bill is H.R. 41. It increases the borrowing authority of theNFIP to $30.425 billion from $20.775 billion.

The legislation is a bare-bones concession from the HouseRepublican leadership to demands from Northeast congressmen, andeven the White House, for prompt action on aid to victims ofHurricane Sandy.

The next step is House floor consideration of two billsproviding additional aid to states hit by Sandy. Debate will takeplace Jan. 15.

One is a bill crafted by Rep. Hal Rogers, R-Ken., chairman ofthe House Appropriations Committee, which would have provided $27billion of supplemental aid to Sandy victims, including theincrease in NFIP borrowing authority.

The other was a bill passed 89-8 by the Senate last Friday thatwould have provided a total of $60.4 billion in aid, less the $9.7billion in borrowing authority provided by H.R. 41.

. The strong “no” vote from Republicans on even the loan pieceindicates that the size of further congressional aid for victims ofSuperstorm Sandy cannot be predicted.

One of the reasons the House acted was that it received amessage from the Federal Emergency Management Agency late Wednesdayindicating that the funds need to pay claims from Superstorm Sandyand other NFIP obligations would run out sometime early nextweek.

As noted by Andrew C. Harris, president of the NationalAssociation of Professional Insurance Agents, “Not paying validclaims is simply not an option.”

Harris said, in comments echoed by other insuranceindustry officials repeatedly to members of Congress, “The federalgovernment has both a legal obligation and a moral imperative topay to indemnify policyholders for their covered flood losses inpolicies backed by the NFIP.”

This article was originally posted at PropertyCasualty360.com,a sister site of Credit Union Times.