Members of the House Banking Committee's housing subcommittee, alarmed at the Department of Housing and Urban Development's handling of the national flood insurance program, are attempting to salvage the present program in a last minute, unofficial intervention.
Rep. Thomas L. Ashley (D-Ohio) confirmed yesterday that he and Rep. Garry Brown (R-Mich.), the subcommittee's chairman and ranking Republican, respectively, have drafted a later to HUD officials aimed at persuading them to resume negotiations with the current consortium which operates the program, the National Flood Insurers' Association. The association is a consortium of 132 insurance companies which has operated the plan since 1969.
Ashley declined to disclose the contents of the letter, describing them only as "secret."
"I've always thought it's a good idea to let the people to whom a letter is written receive it before disclosing to anybody else what it says," he said.
Ashley said he intends to mail the letter early next week.
Subcommittee staff said the letter is directed to HUD's general counsel, Ruth Prokop, and assistant secretary for legislative affairs, Harry Schwartz. Prokop, who is on vacation, could not be reached yesterday.
A subcommittee source said yesterday that Schwartz, in telephone conversations with staff members, has attempted to set up a meeting early next week between himself. Prokop and Ashley and Brown.
Ashely said, however, he knew nothing of such a meeting nor of Schwartz' attempts at arranging one. He said that if HUD officials wished to meet informally, he would be willing to do so.
Schwartz, however, confirmed that a meeting has been set up among the four parties for Tuesday afternoon. "It's on his (Ashley's) calendar," Schwartz said. He stressed that the meeting is intended to be "purely informational, out of courtesy to the chairman" rather than a decision-making session.
At issue is a HUD plan to change drastically the administration of the insurance program, which presently covers about 16,000 persons nationally who reside in flood-plain areas.
HUD has requested bids on a radically different approach to the operation of the program in a search for a new private sector operator. Deadline on the bidding is Sept. 23.