Senators Robert Bennett (R-UT) and Christopher Dodd (D-CT) have reintroduced legislation that extends the federal terrorism backstop for two more years. The current Terrorism Risk Insurance Act is set to expire on Dec. 31, 2005.
The Dodd-Bennett bill would also establish a commission to come up with suggestions for how to handle the long-term risk of terrorism. The same two senators introduced an extension measure in 2004.
NAIOP is in full support of the extension of TRIA, a program that helps insurance companies provide coverage for losses from terrorist attacks. TRIA ensures that all businesses can continue to obtain the terrorism coverage needed to effectively run their businesses. Of utmost urgency is the concern that new annual insurance policies are already being written that extend past Dec. 31, 2005. These policies do not include coverage against terrorism-related losses beyond TRIA's scheduled expiration at year-end.
Federal Reserve Chairman Alan Greenspan told members of Congress he has yet to be convinced the private market alone can adequately insure against the continuing threat of terrorism.
In an appearance before the House Financial Services Committee, Greenspan was asked about the looming expiration of the TRIA. Greenspan questioned whether the ability of the private market alone to insure against terrorism, saying, "There are regrettable instances in which markets do not work, cannot work."
Greenspan's remarks came just one day after CIA Director Porter Goss testified that the terrorist threat endures and that "it may be only a matter of time" before extremist groups attempt to use chemical, biological, radiological, or nuclear weapons in the U.S. According to Goss, al-Qaeda remains "intent on finding ways to circumvent U.S. security enhancements to strike Americans and the homeland."
The measure was unveiled with 14 bipartisan cosponsors, including Dodd, Bennett, Charles Schumer (D-NY), Chuck Hagel (R-NE), Jon Corzine (D-NJ), Jim Bunning (R-KY), Jack Reed (D-RI), Richard Lugar (R-IN), Hillary Clinton (D-NY), Ben Nelson (D-NE), Elizabeth Dole (R-NC), Thomas Carper (D-DE), Saxby Chambliss (R-GA), and Frank Lautenberg (D-NJ).
The National Association of Industrial and Office Properties (NAIOP) encourages Congress to act swiftly on TRIA legislation, ensuring that Americans do not face future gaps in terrorism coverage – which could potentially increase economic uncertainty and job loss.
This information was reprinted from the National Association of Industrial and Office Properties (NAIOP) Legislative News e-newsletter with permission. For more information about this issue, contact Reba Raffaelli, vice president for government affairs, NAIOP, at (703) 904-7100, ext. 115.
NAIOP is a national association with more than 12,000-plus members and an extensive network of 50 chapters that represent the interests of developers and owners of industrial, office, and related commercial real estate throughout North America. NAIOP provides communication, networking, and business opportunities for all real estate-related professionals; provides a forum for continuing education; and promotes effective public policy through its grassroots network, to create, protect, and enhance property values. To find out more, visit (www.naiop.org).