report

The Treasury's report, "Assessment: The Terrorism Risk Insurance Act of 2002," concluded that while TRIA served its purpose as a transitional tool for the insurance market in the post-Sept. 11 climate, the legislation will have outlived its usefulness by the time it expires on Dec. 31 of this year, and that renewal in its present form would restrict growth of the private insurance market "by crowding out innovation and capacity building," Snow noted in a letter attached to the report.

TRIA provides a federal backstop stipulating that the government cover payouts exceeding $100 billion of insurers' annual liability should there be other terrorist attacks. Advocates of the legislation--including members of the real estate and mortgage banking industries--concede that TRIA is only a temporary solution, but support an extension of the act in an effort to develop a more suitable, long-term alternative. For their part, Snow and the White House have indicated that any renewal of TRIA must institute major changes, including parameters to reduce taxpayer responsibility.

"As House and Senate lawmakers gather for hearings this week on TRIA," Real Estate Roundtable president and CEO Jeffrey DeBoer tells GlobeSt.com, "we remind them of the billions of dollars in real estate transactions that were stalled or cancelled between 9/11 and the law's enactment in 2002, and the fact that renewed uncertainty over TRIA's future is already beginning to slow the pace of US real estate market activity."