One of the stories missed by The Macomb Daily in recent days was about Rep. Candice Miller calling for an end to the National Flood Insurance Program, which she called a rip-off for Michigan residents.
The Harrison Township Republican wants swift action on legislation she introduced to eliminate the NFIP, and turn the flood insurance market over to the private sector, with oversight by the states. The NFIP is running a $19 billion deficit, putting all taxpayers at risk for future billions of dollars of debt.
“The National Flood Insurance Program is a typical Washington boondoggle with an endless bureaucracy overseeing out-of-control spending,” Miller said.  “The federal government is a bad insurance company, and the example of the flood insurance program proves that fact.  Michigan has been turned into an ATM machine – forced to pay for the flood risks that our state does not actually face.  The NFIP has a current deficit of over $19 billion and very soon Congress will be asked to raise the debt limit imposed on this program because it continues to hemorrhage taxpayer money.  The only real solution to this problem is to eliminate this program altogether.”
Started in 1968, the NFIP has consistently run a deficit. In addition, one of every four property owners in the program receives subsidized rates, according to Miller, and others in less flood-prone areas pay significantly higher rates than they should based upon risk.  
“This program is so actuarially unsound that if it were to be presented to any state insurance commissioner it would be put out of business,” said the congresswoman.  “For far too long, rates in this program have been set due to political considerations and not actual risk. 
From January through November 2010, Michigan residents paid over $20 million in premiums to the NFIP.  In contrast, Michigan property owners have received just $45 million in claims from the NFIP since 1978.  In other words, in less than one year Michigan residents paid back almost half of the entire sum they have received from the past 33 years, according to the Congressional Research Service.
Miller’s bill would dismantle the NFIP by December 31, 2013, allowing states enough time to form regional insurance compacts to set up coverage and spread risk. These compacts would rely upon the Federal Emergency Management Agency to assist their efforts by producing high quality flood maps to assist states and the private sector to insure against flood loss.
 “The American people spoke in November, and their message was that this is not only the time to cut spending, but to eliminate programs that have no place in the federal government,” Miller said.  “It is far better to leave this job to the states and the private sector, and I urge swift action in both the House and Senate to end this failed program.
“(The legislation) would form compacts to help spread risk equitably and away from federal interference.  The only way to reduce the massive federal budget deficit is to end programs that don’t work and waste taxpayer money.  The NFIP would be an ideal place to start.”