Taxpayers already subsidize the flood insurance people pay for 1.2 million properties in flood plains across the U.S., including Sacramento. Insurance averages $710 a year, but the real rate should be $1,800, given the risk, says the Congressional Budget Office.
FEMA collects about $ 2 billion annually in flood insurance premiums … but expects to pay $23 billion in claims for last year’s hurricanes, including Katrina. Taxpayers will be on the hook for the shortfall. Congress is reviewing the program. Changes may include less or subsidy, higher premiums on vacation homes, and financially penalizing properties with repeated flood losses.