"Dengue Fever in US" Headlines: Not Breaking News
When the "Dengue Fever1 in Key West" story broke last week, we were all set to regale you on the IPCC's prediction of tropical diseases expanding their range, Disney cruise lines re-routing their vessels and tourists canceling their vacations.  It was a good thing other activities got in the way of blogging.  As it turns out, the story gets much more interesting.   
 
 One of the concerns raised by climate change is that tropical diseases such as malaria and dengue fever will infect more people.  The theory is that the altitudinal and latitudinal ranges of the vector - the mosquito - will increase as temperature rises.  This in turn will bring infected mosquitoes in contact with more people and raise the incidence of disease.  In 2007, it was reported "Climate change is accelerating the spread of dengue fever throughout the Americas and in tropical regions worldwide."  http://news.nationalgeographic.com/news/2007/09/070921-dengue-warming.html.  The science, however, since then concludes that climate change is a minor factor in the incidence of dengue and attributes more significance to population growth, urbanization, lack of sanitation, increased long-distance travel, ineffective mosquito control, and increased reporting capacity.  http://www.cdc.gov/dengue/entomologyEcology/climate.html
 
The "Dengue Fever in Key West" story may have hit the national press last week, but it was the subject of a Department of Homeland Security "National Terror Alert" in May, http://www.nationalterroralert.com/updates/2010/05/23/dengue-fever-hits-key-west-florida/, after the CDC reported in its Morbidity and Mortality Weekly Report of an increased incidence in Key West based on cases emerging in the previous 10 months.  http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5919a1.htm    The CDC made no connection to climate change:  "Why dengue has reemerged in Florida at this time is unknown. Dengue might have been present in the community earlier and is only now being detected. The environmental and social conditions for dengue transmission have long been present in south Florida: the potential for introduction of virus from returning travelers and visitors, the abundant presence of a competent mosquito vector, a largely nonimmune population, and sufficient opportunity for mosquitoes to bite humans."
 
If not new news, what precipitated the national furor?  It turns out that the CDC resurrected the story with a press release in anticipation of the International Conference on Emerging Infectious Diseases held last week in Atlanta.  The CDC announced:  "Report Suggests Nearly 5 Percent Exposed to Dengue Virus in Key West."  http://www.cdc.gov/media/pressrel/2010/r100713.htm  This headline was based on the cases reported in the May report, which were then extrapolated to the Key West population, but using an inaccurate value.  http://www.keysnet.com/2010/07/17/239503/cdc-errs-in-level-of-dengue-cases.html Key West authorities were upset and extracted this statement from the CDC (which was reported yesterday):  "In no way, shape or form do we want to discourage people from going to Key West."
 
So what can we take from all this?  First, while climate change may be involved in many of the changes we see around us, it may not be the significant factor in the new event.  Second, the headline may not accurately state the substance of the story.  As the CDC acknowledges, the conditions "have long been present" for dengue in Key West and the current detections may be reflective of ongoing but undetected dengue infections.   Third, someone's ox is always gored.  The CDC's paramount concern is protecting the public health.  But that is tempered with its knowledge of the economic harm an epidemiological indictment of an area can cause.   Public officials will not let the CDC forget that part of the equation.   
 
And now we come back to Disney cruises and vacations.  The CDC reports that the most effective way to protect against dengue fever is to avoid being bitten, which might suggest canceling a cruise or a vacation.  A cautious traveler will have procured travel insurance; however, a word of caution is in order:  read your cancellation coverage; not all policies cover cancellation for an epidemic or fear of an epidemic.
 
1Dengue or dengue fever is a tropical disease infecting globally nearly 100,000,000 people annually; 25,000 of those infections turn out to be fatal.  Symptoms of dengue fever are high fever, headaches, eye pain and joint pain.  Dengue is not uncommonly reported along the Texas-Mexico border.  Before detection in 2009, it had not been seen in Florida since 1934.
NFIP Renewal. Finally. For a Moment.

Well, they finally got around to it. Since May 31 the National Flood Insurance Program has had no authority to issue flood insurance contracts. The House approved extending the NFIP's authority on June 23, the Senate on June 30, and the President signed the bill July 2, retroactive to June 1 (fittingly, the first day of the official Atlantic hurricane season). This is not a new circumstance. The NFIP's authority first lapsed on March 1, again on March 28 and will do so again on September 30, absent a long-term extension.

So what does it mean when the NFIP can't make loans? Dante described a place of sadness and hopelessness in Limbo, the first circle of hell. The metaphor seems apt: a would-be home or small business buyer that cannot get required flood insurance, cannot purchase; she is stuck in a bureaucratic Limbo from which there is no escape but the grace of Congress. Ditto for the home or small business seller.

Is there reason to think otherwise? The various National Flood Insurance Acts forbid lenders from making loans on property located in a Special Flood Hazard Area where federal flood insurance is available. 42 U.S.C. § 4012(a). Since the lapse in NFIP authority means that federal flood insurance is not available, lenders are authorized to make loans on property in the flood plain, without requiring flood insurance first. The FDIC confirms this in its May 7, 2010 Financial Insitution Letter FIL-23-2010 (click here.) 

However, lenders are not released from the obligations under the Acts to make flood determinations, provide notices to borrowers and otherwise comply with the flood insurance regulations. The FDIC confirms that lenders "should evaluate safety-and-soundness and legal risk and prudently manage those risks during the lapse period." Lenders are also required to establish a program to ensure that borrowers obtain flood insurance when (as has happened) the program is reauthorized.

So, what is a prudent lender to do during the lapse period. The FDIC recommends: 1) postpone closing the loan (see Limbo above), 2) close the loan and require the borrower to obtain private flood insurance (which, if such existed at favorable rates, would demonstrate the NFIP is unnecessary), and 3) make the loan without requiring the borrower to apply for flood insurance. But that is a Catch-22 as well. As the FDIC points out, "Each lender remains responsible for protecting its collateral from risk in a manner appropriate to the circumstances ...." If the property is in a SFHA, a loan is given and the property is destroyed by flood, what regulator will recognize that as a prudent lending practice "appropriate to the circumstances"?

So, even if lenders may lend when the NFIP lapses, it seems evident that they will not. As we have written before, the NFIP has numerous issues (premiums that do not match risk, billion dollar deficits, lack of penetration into the populations at risk). Serial lapses of authority and serial reauthorization simply compound these problems.