Mine proposal could end federal flood insurance

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Sunday, February 19, 2012
— The proposed mine in northern Wisconsin would end federal flood insurance statewide, affecting more than 600 policyholders in Rock and Walworth counties, says a lawmaker who focuses on environmental issues.

Rep. Brett Hulsey, D-Madison, said the Assembly mining bill now being considered in the Senate contains provisions that would exempt mining from floodplain management regulations. That exemption would trigger action by the Federal Emergency Management Agency. The bill has cleared the Assembly.

“FEMA does not accept that exemption,” said Hulsey, a former senior regional representative for the Sierra Club and the 2000 recipient of the FEMA Outstanding Public Service Award. “At issue is flood insurance through the National Flood Insurance Program for 18,000 families in Wisconsin, including hundreds in Rock and Walworth counties.”

The risk to flood insurance came as a surprise to Dave Jackowski of Milton, who used the federal program to save his house on Lake Koshkonong after the 2008 flood.

“It was a $180,000 repair bill,” Jackowski said. “We had 11 inches of water on the floor for about two weeks. It wicked up the walls, requiring a rebuild from floor to ceiling.”

That was a bad year for Jackowski and his wife, Laurie. Both lost their jobs when the General Motors plant in Janesville shut down in 2008.

“I have no idea what we would have done without the insurance,” he said.

“It’s a stretch to understand why we would grant a mine that violated the flood insurance rules,” Jackowski said. “It’s sure not a fair tradeoff.”

When he suspected that the proposed exemption for the mine would jeopardize federal flood insurance, Hulsey said he contacted FEMA’s Federal Insurance and Mitigation Administration.

“I received a clear indication that the mine, as proposed in AB 426, will endanger flood insurance,” Hulsey said. “Keep in mind, this is not me simply speculating. The warning came straight from FEMA.”

The chief of floodplain management at FEMA, David Stearrett, said in a Jan. 26 e-mail to Hulsey that the exemption in the Assembly bill would violate federal flood insurance regulations.

“Although state legislation that limits or prevents local community adoption or enforcement of the minimum floodplain requirements is rare, FEMA has addressed similar issues, and if limitations are not remedied, FEMA is required to seek enforcement of the federal requirements that includes suspension from the program,” Stearrett said.

Hulsey, who has been looking into the flood insurance issue for months, said homeowners such as Jackowski have no alternative to national flood insurance.

“I know of no private insurance company that provide this type of flood insurance at any cost,” Hulsey said. “If a flood occurs, the homeowner pays for damages out of pocket.

“Also, when the mortgage lender finds out there is no flood insurance on the property, the mortgage is usually called in, and there’s no way to refinance,” Hulsey said. “That means the owner pays off the mortgage out of pocket or gives up the property.”

The NFIP reported that 486 policies covering nearly $75.4 million of property were in effect in Rock County as of 2008, the latest year for which figures are available. Since 1978, 261 Rock County claims have been filed totaling nearly $4 million. Figures during the same time period for Walworth County include 133 policies covering nearly $33 million in property with 22 claims totaling $19,500.

The national flood insurance implications of the Assembly mining bill were to be addressed by a special mining and jobs committee in the Senate chaired by Sen. Neal Kedzie, R-Elkhorn.

“I am aware of the possibility of the loss of insurance,” Kedzie said last week. “We have the Legislative Council looking at it, and if that’s the case, we will address it.

“We will not propose a bill that results in the loss of flood insurance.”

Since then, Senate Majority Leader Scott Fitzgerald, R-Juneau, disbanded Kedzie’s committee, leaving its work undone.

Fitzgerald’s action stunned one veteran lawmaker who was a member of the committee.

“I can’t think of anything in recent history to compare to this,” said Sen. Bob Jauch, D-Poplar, a committee member.

Republican Sen. Dale Schultz of Richland Center, another member of the special committee with Kedzie and Jauch, told The Associated Press last week he would not vote for the Assembly bill. Without his vote, a Democrat would have to sign on for it to pass the Senate. That’s not likely, Jauch said.

If the Assembly bill fails to pass, the threat to flood insurance would be abated.

“But that only lasts until the next bill from Republicans comes down the pike,” Hulsey said.

Last updated: 7:41 pm Thursday, December 13, 2012

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