Key U.S. Senators have announced a bi-partisan agreement on a long term TRIA extension. Senators Charles Schumer (D-NY), Dean Heller (R-NV), Jack Reed (D-RI), Mark Kirk (R-IL), Chris Murphy (D-CT) and Mike Johanns (R-NE) are the cosponsors of the legislation that is expected to be introduced in the next day or two.
“In a post-9-11 New York, terrorism risk insurance has proven to be an absolutely essential partnership between the government and the private sector that has turned rebuilding downtown Manhattan from a question to a certainty,” said Senator Schumer. “But there is still more to be done and this crucial bipartisan plan will reauthorize and extend the Terrorism Risk Insurance Act before it expires at year’s end. Redevelopment and economic growth should be encouraged in New York and other high-risk areas across the country, even in the face of unfathomable terrorist events, and I will work with my colleagues to get TRIA passed this year to preserve this essential tool.”
“Chicagoans believe it is our birthright to stand in the shadows of the tallest buildings in the world,” Senator Kirk said. “With its private-public partnership, TRIA will better protect the economy from terrorist harm while protecting taxpayers from financial risk.”
The Senate legislation would extend the program for seven years while raising the recoupment amount from $27.5 billion to $37.5 billion and increasing the industry’s copay amount to 20% from 15%.
These changes would be phased in over the next five years.
While reaching a deal in the Senate is a key step in getting TRIA passed, and welcome news to advocates of a long-term extension, including RIMS, there is still a long way to go before an extension is passed. The Senate version must still go through the full Senate process, while, on the House side, there continues to be significant resistance from House Financial Services leadership, including Representatives Jeb Hensarling (R-TX) and Randy Neugebauer (R-TX), who remain skeptical of the program. Any bill from the House Financial Services Committee is expected to include more far reaching adjustments to the program.