Senate Joins House in Passing $36.5B Disaster Aid with Flood Insurance Funds

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The Senate sent President Donald Trump a $36.5 billion hurricane relief bill Tuesday that gives Puerto Rico access to $4.9 billion in low-interest Treasury loans, amid concerns that recovery efforts from the recent disasters will require significantly more funding.

The measure, passed 82-17, also would replenish the troubled National Flood Insurance Program, which runs out of money as early as this week.

The vote followed a failed push by Majority Whip John Cornyn of Texas to insert more disaster recovery aid into the bill for his state, hit hard by flooding from Hurricane Harvey in late August. Democrat Bill Nelson of Florida also pushed unsuccessfully for up to $3 billion more for his state’s citrus industry. Cornyn told reporters Trump assured him that the White House would request the funds for Texas in November.

“We are all committed to meeting the need that has arisen because of these devastating hurricanes,” Senate Majority Leader Mitch McConnell of Kentucky said during floor debate Monday.

The House passed the bill on a 353-69 vote Oct. 12, and Trump is expected to sign it.

Puerto Rico’s governor, Ricardo Rossello, met with Trump at the White House on Oct. 19 to discuss recovery efforts. Rossello pressed Trump for $4.6 billion in recovery assistance on top of the amount provided in the Senate bill. Trump said he deserved a perfect score for his handling of Hurricane Maria, for which he has been criticized.

Low-Interest Loans

The measure, H.R. 2266, calls for $18.7 billion for the Federal Emergency Management Agency, including $4.9 billion for low-interest loans to Puerto Rico and the U.S. Virgin Islands. Puerto Rico is seeking the loans to avert an Oct. 31 government shutdown due to a dwindling cash balance.

The U.S. territory of 3.4 million people has been operating in bankruptcy since May, which makes it difficult — if not impossible — for the government to borrow on its own. The devastation wrought by Hurricane Maria is threatening to exaggerate the financial crisis that had already pushed the island into a series of record-setting defaults on its $74 billion of debt.

The bill provides $16 billion in debt relief to the National Flood Insurance Program, which FEMA has said will run out of money as early as this week without action by Congress.

If that happened, the program would be unable to make claims payments to people whose homes have been damaged by Hurricanes Harvey, Irma, Maria or Nate, or other disasters.The federal government can’t borrow more money from the U.S. Treasury to pay those claims because Congress has limited the flood program’s borrowing authority to $30.4 billion, which it has now reached.

The bill also would provide $576.5 million for fighting wildfires in the West. The House passed the measure after new wildfires broke out that devastated northern California’s wine country.

Texas, Florida

Texas Republican Senators Ted Cruz and Cornyn sought an additional $18.7 billion in rebuilding funds and threatened to hold up passage of the bill until they got assurances from the White House the money would be requested in November.

Nelson said he was “disappointed” that Florida didn’t receive additional funding in this measure.

“I’m disappointed that the president has nixed the disaster money for Florida’s citrus growers,” Nelson said in a statement. “He said it will be included in a November supplemental instead.”

The next round of disaster aid in the House could face some resistance from conservatives.

The conservative groups Heritage Action, Freedomworks and Club for Growth urged members to vote against the bill when it came up in the House.

“Natural disasters are predictable — we know with 100 percent certainty that they will occur in the future. So fiscally responsible stewards of American tax dollars should plan accordingly,” the Club for Growth said in a statement Thursday.