Lawmakers are pressuring FEMA to undo a surprise decision that could prevent thousands of home buyers from acquiring flood insurance during the government shutdown.

Capitol Hill was caught off guard by the agency's sudden announcement — made the day after Christmas — that the National Flood Insurance Program could no longer issue new flood insurance policies during the funding lapse.


The move was jarring because Congress on Friday passed legislation intended to reauthorize the program's operations through May. Millions of homeowners rely on the program to protect themselves from the financial risks of flooding, and coverage is sometimes required to receive a mortgage.

House Majority Whip Steve Scalise (R-La.) planned to speak with FEMA Administrator Brock Long on Thursday to seek a reversal of a decision "to blatantly ignore congressional intent," Scalise spokesperson Lauren Fine said.

Sen. John Kennedy (R-La.), who wrote the legislation Congress passed to reauthorize the program, said he was working with the Department of Homeland Security and the White House on a solution. He spoke with Long Thursday and urged him to walk back FEMA's controversial move.

"President Trump signed my bill to prevent unnecessary chaos like this,” Kennedy said. "FEMA’s decision will cause upheaval for home buyers and sellers across the country."

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The National Association of Realtors warned that FEMA's decision jeopardized tens of thousands of home sales across America.


"I urge FEMA to immediately reconsider this harmful and incorrect interpretation of its authority and resume its important work of providing flood insurance to families across the country," said Rep. Maxine Waters (D-Calif.), who will soon lead oversight efforts of the flood insurance program as chairwoman of the House Financial Services Committee.

In a statement Thursday evening, FEMA said it was reviewing all legal authorities with the administration that would allow the flood insurance program to continue operations without interruption.

According to FEMA, the issue arose because the program pays a fee to insurers to sell flood insurance policies on behalf of the government, and the fee may be considered "an impermissible funding obligation" during the shutdown.


The move may weigh on FEMA's relationship with Congress as lawmakers prepare to draft legislation to overhaul the flood insurance program next year.

Congressional aides said FEMA did not warn lawmakers beforehand that the partial government shutdown would curtail its ability to sell insurance contracts. FEMA did not reveal the decision until Wednesday, when it also confirmed the program can still pay claims for flood damage.

Lawmakers believe the agency has the power to circumvent the lapse in appropriations and continue selling flood insurance contracts.

Sen. Bill Cassidy (R-La.) and Reps. Bill Pascrell (D-N.J.) and Frank Pallone (D-N.J.) sent letters to Long Thursday urging FEMA to take advantage of an exception in the Antideficiency Act, which sets restrictions on government spending, to avoid economic disruption.

They also cited funding the program receives from premiums and fees outside of discretionary congressional appropriations.

"Awful," one congressional aide said of the agency's decision. "FEMA botched it."

