Governor's disaster aid bill would provide nearly $16M for building rehab, razing
Gov. Kim Reynolds and members of her cabinet oversaw parts of northwest Iowa impacted by flooding in a helicopter tour June 21, 2024. (Photo courtesy of Gov. Kim Reynolds' office)
Gov. Kim Reynolds' bill making changes to Iowa's disaster relief assistance programs is on its way to the Iowa Senate floor after approval Thursday by the chamber's Ways and Means Committee.
Senate File 619 has already received approval from the Senate Local Government and Appropriations committees. The bill follows up on some of the measures put in place for disaster recovery by Reynolds following the 2024 floods and tornadoes that impacted more than 5,000 homes across the state.
The measure includes an appropriation of $13.6 million from the Iowa Economic Emergency Fund retroactively for fiscal year 2025 with the majority of funding going toward home rehabilitation programs and $2 million to the Nuisance Property and Abandoned Building Fund, used to tear down buildings that cannot be repaired.
This funding was discussed with lawmakers during the summer of 2024 as Reynolds rolled out the state's disaster response and recovery plans. The bill's appropriation for housing rehabilitation will go toward to the State Disaster Recovery New Housing Grant and Disaster Recovery Housing Assistance programs, launched in July. The governor's bill also includes a proposal to extend tax exclusions for developers who build new housing in disaster-impacted areas.
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The measure also establishes new programs and funds that the governor said will help the state more quickly respond to natural disasters in the future. It would establish a new loan program, the Natural Hazard Mitigation Financing program, led by the Iowa Department of Homeland Security and Emergency Management and the Iowa Finance Authority, with funding available to eligible entities for 'ongoing risk mitigation' projects to better prepare Iowa communities for future severe weather.
Molly Severn, legislative liaison for the governor's office, said the measure will help 'make it easier for Iowans to get the help they need as soon as possible' during natural disasters.
Lawmakers on both sides of the aisle and some advocates have expressed support for the bill's steps to streamline the disaster assistance process and provide funding in previous meetings. However, there was some pushback at the Senate subcommittee meeting Thursday from lobbyists with insurance organizations and public insurance adjusters on one portion of the bill — a requirement for appraisers, independent adjusters and umpires to be licensed to assess property damages.
During the process of receiving insurance coverage following a natural disaster, multiple assessments are made. A public insurance adjuster, representing the policy holder, and a private insurance adjuster representing the insurance company, typically both review a damaged property's value and assessing the claim made. Umpires are the neutral party in this process, meant to serve as an unbiased source while assessing damages and value. But Reynolds said licensure and regulations were needed to 'better protect consumers and homeowners from unfair practices' during the process.
Dennis Tibben with the National Association of Public Insurance Adjusters said most other states regulate umpires and independent adjusters through contracts instead of through the licensing processes set up in the bill.
'If enacted, Iowa would have the most restrictive, expansive licensure type in the nation,' Tibben said. 'And we expect that that will have a chilling effect on the number of individuals who are independent, who will serve as the arbitrators when a public insurance adjuster, who serves as an advocate on behalf of the insured individual, and their insurance company can't come to an initial resolution on the insurance plan.'
Tibben said this provision could lead to fewer umpires and independent adjusters practicing in Iowa, which could leave Iowans with longer wait times for their insurance claims to be processed.
Sen. Bill Dotzler, D-Waterloo, said in the subcommittee meeting he wanted to learn more about the impacts of licensure on insurance costs and processing people's claims after disasters, but he supported the bill moving forward as he said it made improvements to Iowa's disaster relief and recovery programs.
He also supported the bill later Thursday as it was unanimously approved by the Ways and Means committee, praising the governor and her staff for their work on the bill.
'It's my understanding that this isn't something that just was thrown together,' Dotzler said. 'It's been worked on for considerable amount of time, and really is a proactive approach that would help people in real time.'
Sen. David Rowley, R-Spirit Lake, said the bill will improve Iowa's disaster response efforts.
'All of us have been affected by floods, tornadoes, derechos, all of these disasters — hail storms, anything that comes through — it creates a disastrous effect on these communities,' Rowley said. 'We need to address it. We need to be faster than we have been in the past. This allows those dollars to flow forward.'
The bill is now available for debate in the full Iowa Senate, and its companion, House File 982, is available for consideration in the House.
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