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WASHINGTON, DC-The day after testifying before the US House of Representatives Committee on Financial Services regarding renewal of the Terrorism Risk Insurance Act of 2002, US Department of Treasury Secretary John W. Snow took his testimony to the US Senate Committee on Banking, Housing and Urban Affairs Thursday. He restated the department’s and the White House’s position against renewal of the legislation–as noted in the June 30 report, ” Assessment: the Terrorism Risk Insurance Act of 2002–unless major changes are instituted.

“It is our view that continuation of the program in its current form is likely to hinder the further development of the insurance market by crowding out innovation and capacity building,” Snow told the committee. “Consistent with TRIA’s original purpose as a temporary program scheduled to end on December 31, 2005, and the need to encourage further development of the private market, the administration cannot support a straight extension of TRIA.”

Many in the real estate and mortgage banking industries take issue with some findings outlined in the Treasury’s report, specifically the notion that private markets can mostly provide terrorism insurance on their own. “We’re disappointed in the way the conclusions of the Treasury’s report are being used,” Real Estate Roundtable president and CEO Jeffrey D. DeBoer tells GlobeSt.com. “The report doesn’t present a road map as to how private markets could provide the terrorism insurance.” He says the groups agrees with the study’s conclusion that there is $4 to $6 billion in reisnsurance out there and that the need is substantially more than that to make the economy go. “They believe private markets will fill that gap, but we are extremely skeptical; we see no evidence that private markets can do that. We’re in the business of business and we’d like to operate on something more than just a belief. “

But, DeBoer points out that both the administration and supporters of TRIA’s extension want the same thing–continued federal involvement, in some form, that will further the economy. “The administration has not said they want the year to end without a federal terrorism insurance program; they say they want reform,” he notes. “[RER] thinks TRIA worked well, but if there’s a better way to do it, we’re ready and willing to participate in that dialog. We want to go forward; the question is, what steps do we take?

And now that the assessment report has been issued and the hearings have taken place, De Boer says now “its time for the talking to stop and the writing to start so legislation can move.” The temporary TRIA extension bills pending in the House and the Senate, he adds, are vital to the process because “if no one can come up with a better mousetrap before TRIA’s expiration, the bills could be out there to bide time.” DeBoer believes the terrorism insurance is an important enough issue for Congress to deal with before they recess for the year because terrorism insurance goes to the heart of economic safety for the nation. “The House originally did TRIA in six weeks, and that was the first time they had to look at this issue,” he says.

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