06:46 PM PST on Wednesday, January 25, 2006

By SARAH NAKASONE / KING 5 News

WASHINGTON, D.C. - Over the past few years, the government has paid out more than $100 million in flood insurance in Washington state. 

But after a year of record setting hurricanes and near record rain in the Northwest, the flood insurance program has now run dry.

The Congressional Budget Office says the bankrupt program is costing Americans more than $1 billion a year. Now congress wants to fix it.

In the past year, water swallowed up parts of the Gulf Coast and flooded out roads in Washington state and Oregon.

But the national insurance program designed to help in such a disaster is bankrupt.

“The flood insurance program is not working even if you left Katrina out,” said Sen. Paul Sarbanes, D-Maryland.

The problem lies with people in high-risk flood plains who build, rebuild and collect for repeated losses, as well as the government itself, which has not correctly assessed the risk of many houses ... but provided subsidies.

The Federal Emergency Management Agency, which is in charge of the program, admits many of the nation’s flood-plain maps are outdated by as many as thirty years.

Plus, only 25 percent of 500-year floodplains have been mapped, according to Sen. Elizabeth Dole, R-North Carolina.

Which means neither homeowners nor the government may not be aware of the actual risk to property.

“There needs to be substantive and comprehensive reform, going forward with the program, not just allow them to borrow more money,” said David Walker, U.S. Comptroller General.

So congress will consider raising premiums for homeowners, eliminating some subsidies and denying coverage for repetitive losses.

Senators also hammered FEMA for long delays in handling claims appeals.

About one percent of the $4.4 million properties insured by the national program are considered repetitive losses.

These are people who have made two or more $1,000 claims.