The Club For Growth, a conservative group, urged lawmakers to oppose the flood insurance bill. "Congress should not allow the federal government to be involved in the flood insurance industry in the first place, let alone expand the national flood insurance program's authority," the group said in a statement.
Among those with a pending flood insurance claim is Philip Rock in New Jersey. Rock has gotten $8,000 in flood insurance payments so far on a house he rents out in Toms River that was destroyed. He expects to receive much more from his $220,000 insurance policy but can't level the house until he knows the final payout.
"We don't want to demolish the house and have them say, 'We have to go around and take more pictures,'" Rock said.
The Federal Emergency Management Agency had warned that the flood insurance program would run out of money next week if Congress didn't provide additional borrowing authority. Congress created the FEMA-run program in 1968 because few private insurers cover flood damage.
The $2 billion FEMA already has spent went to providing shelter, restoring power and meeting other immediate needs. Eleven states — New York, New Jersey, Connecticut, West Virginia, Virginia, Maryland, New Hampshire, Delaware, Rhode Island, Pennsylvania and Massachusetts — plus the District of Columbia have shared that money.
FEMA's disaster relief fund still has about $4.3 billion, enough to pay for emergency response efforts into early spring, according to officials.
Sandy is the most costly natural disaster since Hurricane Katrina in 2005. Northeast lawmakers have complained that while it took Congress just 10 days to approve about $50 billion in Katrina aid, additional money for Sandy victims hasn't been forthcoming in more than two months.
The storm damaged or destroyed more than 72,000 homes and businesses in New Jersey. In New York, 305,000 housing units were damaged or destroyed and more than 265,000 businesses were disrupted, officials have said.
Associated Press writers Andrew Taylor and Jim Abrams in Washington and Katie Zezima in Newark, N.J., contributed to this story.