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FEMA Insurance Program $17.8B in Debt

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  • Description

    FBN’s Gerri Willis on the financial problems plaguing the FEMA Insurance Program.

  • Duration 2:52
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This transcript is automatically generated

I think may be only -- tropical storm now.

But the damage it leaves in its wake will still be at least a billion dollars.

Flooding will be a major cause of lots and that means only homeowners with flood insurance coverage are likely to get help.

Most of that coverage comes from Uncle Sam and the National Flood Insurance Program.

What -- report many advised its victims though renewing the FEMA insurance program was one of the rare non partisan issues that congress can actually agree on.

Before going on a month long summer recess legislators passed a five year extension of the program and extended it.

For another five years the program -- national flood insurance and stability but that doesn't mean its problems are over far from it.

First and foremost the program is deep in debt after hurricanes Katrina and Rita the fund found is.

Under water to the tune -- eighteen billion dollars according to a 2011 GAO report.

Premiums from homeowners just not enough to make up the difference all of the insurance program was originally set up to be self sustaining.

Is -- seventeen funding extensions in almost went out of business completely four times.

Worse the program has statutory authority to borrow from the US treasury not many people get back.

Today the GAO says the financial hole is so deep that it's unlikely the money will ever be repaid.

To top it off the GAO concludes the program is actually what our actuarial light and -- it makes no sense probably just with one -- though.

And the GAO report had other bad news the program systems their antiquated running on pen and paper.

Rather than computers.

Departments of the local state national level can't easily share new documentary view old ones.

Look I know this is hard to imagine but apparently it's true the folks -- FEMA didn't refute the fact we asked them about it today.

And the result of that step in the seventies management philosophy getting something done is nearly impossible.

According to the report.

Because many of FEMA -- processes were manual -- culture have become dependent.

On people with staff relying on personal relationships to accomplish tasks.

The GAO called for a full on assessment of the programs staff and a plan of action to make sure it had -- systems in the people would need to operate efficiently.

In other words the whole program needs a revamped if you're thinking port -- is having problems because it's woefully understaffed.

-- not the agency has grown like topsy in the wake of Katrina.

The funding extension passed by congress this summer -- very little of these problems in made an attempt to -- -- properties that are repeatedly flooded.

But addressing the bigger ones not a chance another can kick down the road until the next storm the next time which will happen soon enough.

That's what I think now let me know what you.

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