Friday, April 30, 2010
Wharton Leadership Digest, December 2001
By Colonel James E. Moschgat, Commander of the 12th
Operations Group, 12th Flying Training Wing, Randolph
Air Force Base, Texas
William “Bill” Crawford certainly was an unimpressive figure,
one you could easily overlook during a hectic day at the
U.S. Air Force Academy. Mr. Crawford, as most of us
referred to him back in the late 1970s, was our squadron
While we cadets busied ourselves preparing for academic
exams, athletic events, Saturday morning parades and room inspections, or
never-ending leadership classes, Bill quietly moved about the squadron mopping
and buffing floors, emptying trash cans, cleaning toilets, or just tidying up the
mess 100 college-age kids can leave in a dormitory. Sadly, and for many years,
few of us gave him much notice, rendering little more than a passing nod or
throwing a curt, “G’morning!” in his direction as we hurried off to our daily duties.
Why? Perhaps it was because of the way he did his job-he always kept the
squadron area spotlessly clean, even the toilets and showers gleamed. Frankly,
he did his job so well, none of us had to notice or get involved. After all, cleaning
toilets was his job, not ours. Maybe it was is physical appearance that made him
disappear into the background. Bill didn’t move very quickly and, in fact, you
could say he even shuffled a bit, as if he suffered from some sort of injury. His
gray hair and wrinkled face made him appear ancient to a group of young cadets.
And his crooked smile, well, it looked a little funny. Face it, Bill was an old man
working in a young person’s world. What did he have to offer us on a personal
Finally, maybe it was Mr. Crawford’s personality that rendered him almost
invisible to the young people around him. Bill was shy, almost painfully so. He
seldom spoke to a cadet unless they addressed him first, and that didn’t happen
very often. Our janitor always buried himself in his work, moving about with
stooped shoulders, a quiet gait, and an averted gaze. If he noticed the hustle
and bustle of cadet life around him, it was hard to tell. So, for whatever reason,
Bill blended into the woodwork and became just another fixture around the
squadron. The Academy, one of our nation’s premier leadership laboratories,
kept us busy from dawn till dusk. And Mr. Crawford...well, he was just a janitor.
That changed one fall Saturday afternoon in 1976. I was reading a book about
World War II and the tough Allied ground campaign in Italy, when I stumbled
across an incredible story. On September 13, 1943, a Private William Crawford
from Colorado, assigned to the 36th Infantry Division, had been involved in some
bloody fighting on Hill 424 near Altavilla, Italy. The words on the page leapt out at
me: “in the face of intense and overwhelming hostile fire ... with no regard for
personal safety ... on his own initiative, Private Crawford single-handedly
attacked fortified enemy positions.” It continued, “for conspicuous gallantry and
intrepidity at risk of life above and beyond the call of duty, the President of the
United States ...”
“Holy cow,” I said to my roommate, “you’re not going to believe this, but I think
our janitor is a Medal of Honor winner.” We all knew Mr. Crawford was a WWII
Army vet, but that didn’t keep my friend from looking at me as if I was some sort
of alien being. Nonetheless, we couldn’t wait to ask Bill about the story on
Monday. We met Mr. Crawford bright and early Monday and showed him the
page in question from the book, anticipation and doubt in our faces. He starred
at it for a few silent moments and then quietly uttered something like, “Yep, that’s
Mouths agape, my roommate and I looked at one another,
then at the book, and quickly back at our janitor. Almost at
once we both stuttered, “Why didn’t you ever tell us about it?”
He slowly replied after some thought, “That was one day in
my life and it happened a long time ago.”
I guess we were all at a loss for words after that. We had to
hurry off to class and Bill, well, he had chores to attend to.
However, after that brief exchange, things were never again
the same around our squadron. Word spread like wildfire
among the cadets that we had a hero in our midst-Mr. Crawford, our janitor, had
won the Medal! Cadets who had once passed by Bill with hardly a glance, now
greeted him with a smile and a respectful, “Good morning, Mr. Crawford.”
Those who had before left a mess for the “janitor” to clean up started taking it
upon themselves to put things in order. Most cadets routinely stopped to talk to
Bill throughout the day and we even began inviting him to our formal squadron
functions. He’d show up dressed in a conservative dark suit and quietly talk to
those who approached him, the only sign of his heroics being a simple blue, starspangled
Almost overnight, Bill went from being a simple fixture in our squadron to one of
our teammates. Mr. Crawford changed too, but you had to look closely to notice
the difference. After that fall day in 1976, he seemed to move with more
purpose, his shoulders didn’t seem to be as stooped, he met our greetings with a
direct gaze and a stronger “good morning” in return, and he flashed his crooked
smile more often. The squadron gleamed as always, but everyone now seemed
to notice it more. Bill even got to know most of us by our first names, something
that didn’t happen often at the Academy. While no one ever formally
acknowledged the change, I think we became Bill’s cadets and his squadron.
As often happens in life, events sweep us away from those in
our past. The last time I saw Bill was on graduation day in
June 1977. As I walked out of the squadron for the last time,
he shook my hand and simply said, “Good luck, young man.”
With that, I embarked on a career that has been truly lucky
and blessed. Mr. Crawford continued to work at the
Academy and eventually retired in his native Colorado where
he resides today, one of four Medal of Honor winners living in
a small town.
A wise person once said, “It’s not life that’s important, but
those you meet along the way that make the difference.” Bill was one who made
a difference for me. While I haven’t seen Mr. Crawford in over twenty years,
he’d probably be surprised to know I think of him often. Bill Crawford, our janitor,
taught me many valuable, unforgettable leadership lessons. Here are ten I’d like
to share with you.
1. Be Cautious of Labels. Labels you place on people may define your
relationship to them and bound their potential. Sadly, and for a long time, we
labeled Bill as just a janitor, but he was so much more. Therefore, be cautious of
a leader who callously says, “Hey, he’s just an Airman.” Likewise, don’t tolerate
the O-1, who says, “I can’t do that, I’m just a lieutenant.”
2. Everyone Deserves Respect. Because we hung the “janitor” label on Mr.
Crawford, we often wrongly treated him with less respect than others around us.
He deserved much more, and not just because he was a Medal of Honor winner.
Bill deserved respect because he was a janitor, walked among us, and was a
part of our team.
3. Courtesy Makes a Difference. Be courteous to all around you, regardless of
rank or position. Military customs, as well as common courtesies, help bond a
team. When our daily words to Mr. Crawford turned from perfunctory “hellos” to
heartfelt greetings, his demeanor and personality outwardly changed. It made a
difference for all of us.
4. Take Time to Know Your People. Life in the military is hectic, but that’s no
excuse for not knowing the people you work for and with. For years a hero
walked among us at the Academy and we never knew it. Who are the heroes
that walk in your midst?
5. Anyone Can Be a Hero. Mr. Crawford certainly didn’t fit anyone’s standard
definition of a hero. Moreover, he was just a private on the day he won his
Medal. Don’t sell your people short, for any one of them may be the hero who
rises to the occasion when duty calls. On the other hand, it’s easy to turn to your
proven performers when the chips are down, but don’t ignore the rest of the
team. Today’s rookie could and should be tomorrow’s superstar.
6. Leaders Should Be Humble. Most modern day heroes and some leaders are
anything but humble, especially if you calibrate your “hero meter” on today’s
athletic fields. End zone celebrations and self-aggrandizement are what we’ve
come to expect from sports greats. Not Mr. Crawford-he was too busy working to
celebrate his past heroics. Leaders would be well-served to do the same.
7. Life Won’t Always Hand You What You Think You Deserve. We in the military
work hard and, dang it, we deserve recognition, right? However, sometimes you
just have to persevere, even when accolades don’t come your way. Perhaps you
weren’t nominated for junior officer or airman of the quarter as you thought you
should - don’t let that stop you.
8. Don’t pursue glory; pursue excellence. Private Bill Crawford didn’t pursue
glory; he did his duty and then swept floors for a living. No job is beneath a
Leader. If Bill Crawford, a Medal of Honor winner, could clean latrines and smile,
is there a job beneath your dignity? Think about it.
9. Pursue Excellence. No matter what task life hands you, do it well. Dr. Martin
Luther King said, “If life makes you a street sweeper, be the best street sweeper
you can be.” Mr. Crawford modeled that philosophy and helped make our
dormitory area a home.
10. Life is a Leadership Laboratory. All too often we look to some school or PME
class to teach us about leadership when, in fact, life is a leadership laboratory.
Those you meet everyday will teach you enduring lessons if you just take time to
stop, look and listen. I spent four years at the Air Force Academy, took dozens
of classes, read hundreds of books, and met thousands of great people. I
gleaned leadership skills from all of them, but one of the people I remember most
is Mr. Bill Crawford and the lessons he unknowingly taught. Don’t miss your
opportunity to learn.
Bill Crawford was a janitor. However, he was also a teacher, friend, role model
and one great American hero. Thanks, Mr. Crawford, for some valuable
Dale Pyeatt, Executive Director of the National Guard Association of Texas,
comments: And now, for the “rest of the story”: Pvt William John Crawford was
a platoon scout for 3rd Platoon of Company L 1 42nd Regiment 36th Division
(Texas National Guard) and won the Medal Of Honor for his actions on Hill 424,
just 4 days after the invasion at Salerno.
On Hill 424, Pvt Crawford took out 3 enemy machine guns before darkness fell,
halting the platoon’s advance. Pvt Crawford could not be found and was
assumed dead. The request for his MOH was quickly approved. Major General
Terry Allen presented the posthumous MOH to Bill Crawford’s father, George, on
11 May 1944 in Camp (now Fort) Carson, near Pueblo. Nearly two months after
that, it was learned that Pvt Crawford was alive in a POW camp in Germany.
During his captivity, a German guard clubbed him with his rifle. Bill overpowered
him, took the rifle away, and beat the guard unconscious. A German doctor’s
testimony saved him from severe punishment, perhaps death. To stay ahead of
the advancing Russian army, the prisoners were marched 500 miles in 52 days
in the middle of the German winter, subsisting on one potato a day. An allied
tank column liberated the camp in the spring of 1945, and Pvt Crawford took his
first hot shower in 18 months on VE Day. Pvt Crawford stayed in the army before
retiring as a MSG and becoming a janitor. In 1984, President Ronald Reagan
officially presented the MOH to Bill Crawford.
William Crawford passed away in 2000. He is the only U.S. Army veteran and
sole Medal of Honor winner to be buried in the cemetery of the U.S. Air Force
Note: Co. James Moschgat can be contacted at
email@example.com. A profile of William Crawford is available at
http://www.homeofheroes.com/profiles/profiles_crawford.html, and his Medal of
Honor citation can be found at www.army.mil/cmh-pg/mohiia1.htm.
Thursday, April 29, 2010
But there is little sign the belt-tightening extends to top executives at those firms, when measured by pay. Since Hurricane Ivan struck in 2004 many industry leaders have enjoyed handsome boosts in compensation, according to public records reviewed by The Press-Register of Mobile. The companies defend their pay practices, offering a variety of reasons for the increases, such as strong corporate performance and pay scales at similarly sized firms.
At State Farm, which announced in February it was dropping homeowner coverage for some 2,600 policyholders in Mobile and Baldwin counties, Chairman and Chief Executive Officer Edward Rust Jr. collected about $11.7 million in salary and bonus last year - more than double the $5.5 million he received in 2004. Other top executives shared in the wealth. Michael Tipsord, the company's chief financial officer, made almost $5 million last year, compared with $1.1 million in 2004.
At Alfa Insurance Corp., which is dropping wind coverage for 4,600 coastal policyholders in Alabama, President and CEO Jerry Newby's compensation package last year totaled about $1.7 million, up by more than one-quarter since 2004. For chief executives at California-based Fire Insurance Exchange and Texas-based USAA, two other leading writers of homeowner policies in the state, the percentage increases in compensation during the 2004-06 time frame were about 75 and 150 percent, respectively.
The Press-Register obtained the numbers from the Nebraska Department of Insurance, which requires all insurers licensed in the state to report the total compensation of their 10 highest-paid executives each year. Of the leading homeowner-insurance providers in Alabama, the Nebraska agency lacked complete records for only one, the Automobile Insurance Company of Hartford.
At State Farm, which was Alabama's leading property insurer last year with almost 30 percent of the market, compensation "has been very modest compared to companies of our size," spokesman Phil Supple said. While the Illinois-based insurance giant ranked 22nd last year on Fortune magazine's list of the top 500 companies in the United States, Rust's compensation placed 124th, Supple said.
He also saw no connection between State Farm's executive pay scale and its efforts to limit exposure to future hurricane losses.
"That, in a way, is what's called good business," he said on the latter subject. "You need to make sure that you don't overextend your company and harm its financial strength."
Echoing that argument was Dave Rickey, a spokesman for Alfa, whose headquarters are in Montgomery. "We're always looking at the risk ahead, not necessarily what's happened in past years," Rickey said. He did not know all the factors behind the jump in Newby's compensation. About one-third came from salary and bonus increases; the remainder resulted from a boost in "all other compensation," according to Alfa's latest filing with the Nebraska insurance department. That category may include everything from stock options to long-term disability reimbursement, Rickey said.
One industry critic saw the growing pay packages as evidence of an industry awash in cash.
"They're making so much money, they've got to spend it somewhere," said Robert Hunter, director of insurance for the Consumer Federation of America, an advocacy group. "Why not spend it on themselves?"
In a study released early this year, Hunter concluded the property and casualty insurers garnered record profits of about $60 billion last year. At the same time, in a continuation of a trend dating to the late 1980s, claims payouts by the top 10 insurers fell to 52 percent of total premium revenue, the report estimated.
One partial exception to the trend of skyrocketing executive pay was Illinois-based Allstate Insurance Co., which has taken steps to drop between 9,500 and 10,000 homeowner policies in Alabama, according to the state insurance department. Chief Executive Edward Liddy's total compensation fell by almost one-third between 2004 and 2006. Still, his pay package, including stock options, last year amounted to about $20.1 million.
That figure, which comes from the company's filing with the Nebraska insurance department, is almost $4 million lower than Allstate reported in a proxy statement to the U.S. Securities and Exchange Commission earlier this year. Company spokeswoman Laura Strykowski could not explain the discrepancy. Liddy stepped down as Allstate's CEO at the end of last year, while keeping the chairman's post.
Of the nine other Allstate executives listed in the latest Nebraska report, seven had seen their compensation rise since 2004, sometimes significantly. For Robert Pike, executive vice president and secretary, last year's total added up to $11.1 million, well more than twice what he had earned two years earlier.
Allstate ties executive compensation to performance, Strykowski said. "With a superior year of performance in '06, Allstate's executives were paid superior levels of compensation," she said.
While families, business owners, and community leaders were still digging their way through Katrina's rubble, insurance executives focused on pocketing policyholder premiums, padding corporate profits, and passing out big salaries and bonuses.
Pocketing Premiums, Padding Profits
Insurance company memos specifically directed employees to deny American policyholders wind damage claims for properties on which so much as a drop of water had been involved in the property damage. The insurance companies sent a $23 billion bill to the federal government's National Flood Insurance Program (NFIP). The amount of this $23 billion that stems from claims that the insurance companies willfully and fraudulently submitted to the federal government has yet to be determined.
What has been determined, however, is the billions of dollars in profit that the property insurance industry has publicly reported. In 2005--the year that Katrina hit the Gulf Coast, the Insurance Industry Institute reported te property insurance industry had a net gain of $19.5 billion--roughly the amount sent to the federal flood insurance program. That sectors total profit for the years was $44 billion. For 2006, the Institute reported $64 billion in profits for the industry. For 2005 and 2006 combined, property insurance companies cleared--after taxes and after submitting an untold number of fraudulent flood claims to the federal government --$108 billion in net profit.
Passing Out Big Bonuses and Salaries
Ed Rust, Jr., State Farm
CEO and Chairman
State Farm website
The Associated Press reported that State Farm's board of directors rewarded Ed Rust, Jr., chariman and CEO, with a $5.26 million raise in 2006, the year after Katrina devastaed the Gulf Coast. "He earned $11.66 million in 2006 with a base salary of $1.77 million and results-based bonus of $9.89 million."
Ed Liddy, Allstate CEO and
photo: Allstate website
Forbes Magazine reported the total compensation for Allstate's CEO Ed Liddy was $27 million in 2005 and $18 million for 2006.
Liddy, Allstate, and AIG
"On September 18, 2008, the Board of Directors of American International Group, Inc. elected Edward M. Liddy as Chief Executive Officer and a director of AIG and appointed him as Chairman of the Board. Mr. Liddy, age 62, joined the private equity investment firm of Clayton, Dubilier & Rice, Inc. earlier this year. He served as Chairman of the Board of The Allstate Corporation, the parent of Allstate Insurance Company, from January 1999 until his retirement in April 2008. He also served as Chief Executive Officer of Allstate from January 1999 to December 2006, President from January 1995 to May 2005, and Chief Operating Officer from August 1994 to January 1999." Forbes Magazine
In last week's newsletter, I mentioned that a subcommittee was going to hold a hearing on my Multiple Peril Insurance legislation H.R. 1264) Wednesday, April 21, the Subcommittee on Housing and Community Opportunity held a hearing on my legislation and other reforms of the National Flood Insurance Program.
This week, the House Financial Services Committee approved my bill to allow homeowners and business owners to buy flood and wind insurance in one policy from the National Flood Insurance Program (NFIP). On Tuesday, April 27, the full House Financial Services Committee voted in favor of the Multiple Peril Insurance Act by a vote of 40-25.
The Multiple Peril Insurance Act should soon come to a vote in the full House of Representatives. Below are a number of articles that provide much detail on the committees' activities.
In addition to the news articles, I am providing links to my written testimony and a video of my questioning FEMA Administrator Craig Fugate during the April 21 hearing. (The National Flood Insurance Program is part of FEMA.) I pointed out to Administrator Fugate that federal taxpayers paid more than $54 billion after Katrina on NFIP claims, housing assistance, FEMA trailers, homeowner grants, and subsidized disaster loans. The federal government stepped in to provide necessary relief for thousands of homeowners who thought that they had the hurricane insurance coverage they needed but instead were denied legitimate coverage by their insurance companies.
I asked Administrator Fugate if he was aware of any FEMA investigations of fraud committed by the insurance companies that contract with NFIP. Those private companies have a contract with the nation that requires them to conduct a fair adjustment of flood and wind claims. However, these private insurance companies have an inherent conflict of interest when FEMA allows them to decide whether to blame damage on flooding and bill it to the taxpayers or blame it on wind coverage in their own policies.
As many South Mississippi families are well aware, the Multiple Peril Insurance Act would eliminate the insurance companies' conflict of interest and close the gaps between wind and flood coverage by allowing homeowners to buy insurance that will cover hurricane damage without any delays or disputes over the cause of the damage. This program would save taxpayers billions of dollars by reducing the need for FEMA trailers, homeowner grants, and subsidized loans after future hurricanes.
March 12, 2010, 12:13PM
Republican gubernatorial candidate Bradley Byrne today introduced a plan to address Alabama’s coastal insurance crisis, saying the issue threatens one of the state’s most powerful economic engines. (Press-Register/Kate Mercer)Bradley Byrne
Byrne, a Mobile native and resident of Montrose in Baldwin County, said he would form a coalition of governors from coastal states to focus attention on the issue and introduce a package of legislation designed to encourage insurers to write affordable policies in coastal areas.
The coalition’s first task, he said, will be lobbying Congress for changes that would stabilize the reinsurance market and create more favorable conditions for private insurance companies.
“There is no one silver bullet,” Byrne said in an interview with the Press-Register. “This is a complex problem that will require reforms at both the state and federal levels. As governor, I won’t waste any time getting started on it.”
Byrne said private insurers have essentially pulled out of Mobile and Baldwin counties and are continuing to retreat northward. Byrne said his own wind coverage was canceled last year despite the fact that he never filed a wind damage claim or missed a premium payment.
“It’s more than just a coastal issue,” he said. “While I understand the perceptions of lawmakers who don’t live near the coast or represent constituencies that share the concerns of coastal Alabamians, I strongly disagree with any who contend that this insurance coverage crisis does not affect them.”
Byrne’s proposal includes legislation that would strengthen building codes for Mobile and Baldwin counties and establish tax-exempt “catastrophe savings accounts” that would help homeowners pay for storm damages.
Byrne, one of nine candidates seeking the Republican party’s nomination for governor, also said he would work to open Alabama’s insurance market to competition and eliminate the blanket practice of “red-lining” policies across wide areas.
Wednesday, April 28, 2010
No easy fixes for National Flood Insurance Program's $19 billion debt
By Sean Reilly
April 22, 2010, 8:01AMWASHINGTON -- Amid public fury over government bailouts, there's one rescue effort that Gulf Coast property owners would likely welcome: a write-off of the National Flood Insurance Program's almost $19 billion debt to the federal treasury.
Many observers view that step as inevitable at some point, given that the alternative could be a politically unpopular premium increase. But as a Wednesday congressional hearing again showed, fixing the beleaguered flood program will take more than mopping up its red ink.
"Our challenges are daunting," Federal Emergency Management Agency Administrator Craig Fugate told lawmakers at the meeting of the House Financial Services Subcommittee on Housing and Community Opportunity.
Four-and-a-half-years after losses from Hurricanes Katrina and Rita pushed the program into virtual bankruptcy, however, Congress has done little to confront them.
"This is almost like the never-ending story," said the subcommittee's top Republican, Rep. Shelley Moore Capito of West Virginia.
Besides the debt, which Fugate pegged at about $18.7 billion, he noted that many property owners pay underpriced premiums that don't fully reflect their actual flooding risk.
Another witness, Mississippi Rep. Gene Taylor, D-Bay St. Louis, again singled out the "inherent conflict of interest" when private insurers are responsible for adjusting claims that may involve both wind and water damage. And David Conrad of the National Wildlife Federation objected that the availability of government-backed flood insurance encourages risky development in environmentally sensitive areas.
Twice in the last two months, lawmakers have allowed the program to lapse. The latest gap lasted more than two weeks and left many homebuyers facing delayed or canceled closings because they couldn't get the flood insurance needed for a mortgage, according to a National Association of Home Builders representative who testified Wednesday.
Although Congress approved an extension last week, it will last only through next month, potentially leaving the program in limbo after that.
Created in 1968 because private insurers were reluctant to cover water damage, the flood program now has some 5.6 million policies nationwide, according to the most recent available statistics. Of those, some 56,300 are in Alabama, with almost 76,500 in Mississippi, In both states, the bulk of policyholders are concentrated in coastal counties.
Next Tuesday, the full financial services committee is scheduled to take up two separate flood insurance bills. One, introduced by Taylor -- and co-sponsored by Alabama Reps. Jo Bonner, R-Mobile, and Artur Davis, D-Birmingham -- would allow the government to offer optional windstorm coverage.
The other, introduced by the housing subcommittee's chairwoman, Rep. Maxine Waters, D-Calif., would extend the flood program through 2015, but would also allow property owners to put off buying flood policies for five years when updated flood maps show they are in the 100-year flood plain.
Both measures face uncertain odds. In the past, for example, Taylor's approach has been opposed by Sen. Richard Shelby, R-Tuscaloosa, on the grounds that it would add to taxpayers' possible liabilities.
And while supporters of Waters' bill said Wednesday that an economic downturn is not the time to push people to begin buying flood policies, Conrad saw her tack as dangerous because it would leave property owners in flood-prone areas at risk of major losses, with only limited government aid as a backup.
-TIG Congressman Taylor has been fantastic in Ms. However, while we can learn quite a bit from his bill proposal, the government should NEVER be in the business of business. Once our Federal government can show any successful program that it has maintained, then we should reconsider. However, I dont know of a single program (welfare) that has been profitable, or even broken even.
U.S. House committee passes wind coverage bill, but odds of final approval steep
By Sean Reilly
April 28, 2010, 6:31AMView full size(The Mississippi Press/Jon Hauge) WASHINGTON -- Legislation to add optional windstorm coverage to the federal flood insurance program again passed a House committee Tuesday, but appears to face the same steep odds that doomed it two years ago.
Under the measure approved by the House Financial Services Committee, flood insurance policyholders could also get government-backed wind coverage. The committee approved the measure 40-25 on a mostly party-line vote. A committee spokeswoman did not know when the full House might take it up.
As private insurers continue to pull back from the Gulf Coast, the measure's lead sponsor, Mississippi Rep. Gene Taylor, D-Bay St. Louis, has said that it would give property owners a better alternative to state wind pools.
In the event of future storms, Taylor contends, his measure would help avert the kind of "wind versus water" lawsuits that followed Hurricane Katrina in 2005.
His approach has attracted numerous opponents, ranging from environmentalists who say it would encourage risky development, to conservatives who object to more government involvement in the marketplace.
Although optional wind coverage has received House approval in the past, the Senate scuttled a similar proposal two years ago on a 74-19 vote. Among the critics is Sen. Richard Shelby, R-Tuscaloosa, who says it could lead to more taxpayer liability for the flood program, already almost $19 billion in debt to the federal treasury.
On a separate voice vote Tuesday, the financial services committee also approved a bill to keep the flood insurance program -- which has twice lapsed in the last two months -- in business for another five years. The bill, sponsored by Rep. Maxine Waters, D-Calif., also would delay implementation of new flood maps, allowing property owners in newly classified flood zones to wait five years before having to buy flood insurance policies.
The flood insurance program, created in 1968 because private insurers were reluctant to cover water damage, now has some 5.6 million policies nationwide, according to the most recent available statistics. Of those, some 56,300 are in Alabama and almost 76,500 are in Mississippi. In both states, the bulk of policyholders are concentrated in coastal counties.