Thousands face flood insurance hikes in Arkansas

LITTLE ROCK, Ark. (AP) -- More than 5,300 homeowners in Arkansas are facing flood insurance premium increases as the federal government reduces subsidies to the program.

The number comes from an Associated Press analysis of the National Flood Insurance Program. More than 2,300 business and vacation homeowners in Arkansas will have to pay more.

President Barack Obama has signed a bill into law that limits the increases to up to 18 percent for owners of primary homes. Business owners and owners of vacation homes will see a mandatory 25 percent annual increase.

Jim Reeves is the mayor of the tiny northern Arkansas city of Norfork. He says he is worried about property values if prospective home buyers are socked with the full price of flood insurance that's been subsidized for current owners.