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[House Report 110-340]
[From the U.S. Government Publishing Office]

110th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 1st Session                                                    110-340

======================================================================

 
          FLOOD INSURANCE REFORM AND MODERNIZATION ACT OF 2007

                                _______
                                

 September 24, 2007.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Frank of Massachusetts, from the Committee on Financial Services, 
                        submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 3121]

      [Including cost estimate of the Congressional Budget Office]

  The Committee on Financial Services, to whom was referred the 
bill (H.R. 3121) to restore the financial solvency of the 
national flood insurance program and to provide for such 
program to make available multiperil coverage for damage 
resulting from windstorms and floods, and for other purposes, 
having considered the same, report favorably thereon with an 
amendment and recommend that the bill as amended do pass.

                                CONTENTS

                                                                   Page
Amendment........................................................     2
Purpose and Summary..............................................    17
Background and Need for Legislation..............................    17
Hearings.........................................................    19
Committee Consideration..........................................    21
Committee Votes..................................................    21
Committee Oversight Findings.....................................    25
Performance Goals and Objectives.................................    25
New Budget Authority, Entitlement Authority, and Tax Expenditures    26
Committee Cost Estimate..........................................    26
Congressional Budget Office Estimate.............................    26
Federal Mandates Statement.......................................    32
Advisory Committee Statement.....................................    32
Constitutional Authority Statement...............................    32
Applicability to Legislative Branch..............................    32
Earmark Identification...........................................    33
Exchange of Committee Correspondence.............................    33
Section-by-Section Analysis of the Legislation...................    34
Changes in Existing Law Made by the Bill, as Reported............    38
Additional Views.................................................    60

                               Amendment

  The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``Flood Insurance 
Reform and Modernization Act of 2007''.
  (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Findings and purposes.
Sec. 3. Study regarding status of pre-firm properties and mandatory 
purchase requirement for natural 100-year floodplain and non-federally 
related loans.
Sec. 4. Phase-in of actuarial rates for nonresidential properties and 
non-primary residences.
Sec. 5. Exception to waiting period for effective date of policies.
Sec. 6. Enforcement.
Sec. 7. Multiperil coverage for flood and windstorm.
Sec. 8. Maximum coverage limits.
Sec. 9. Coverage for additional living expenses, basement improvements, 
business interruption, and replacement cost of contents.
Sec. 10. Notification to tenants of availability of contents insurance.
Sec. 11. Increase in annual limitation on premium increases.
Sec. 12. Increase in borrowing authority.
Sec. 13. FEMA participation in State disaster claims mediation 
programs.
Sec. 14. FEMA annual report on insurance program.
Sec. 15. Flood insurance outreach.
Sec. 16. Grants for direct funding of mitigation activities for 
individual repetitive claims properties.
Sec. 17. Extension of pilot program for mitigation of severe repetitive 
loss properties.
Sec. 18. Flood mitigation assistance program.
Sec. 19. GAO study of methods to increase flood insurance program 
participation by low-income families.
Sec. 20. Notice of availability of flood insurance and escrow in RESPA 
good faith estimate.
Sec. 21. Reiteration of FEMA responsibilities under 2004 Reform Act.
Sec. 22. Ongoing modernization of flood maps and elevation standards.
Sec. 23. Notification and appeal of map changes; notification of 
establishment of flood elevations.
Sec. 24. Clarification of replacement cost provisions, forms, and 
policy language.
Sec. 25. Authorization of additional FEMA staff.
Sec. 26. Extension of deadline for filing proof of loss.
Sec. 27. 5-year extension of program.
Sec. 28. Report on inclusion of building codes in floodplain management 
criteria.
Sec. 29. Study of economic effects of charging actuarially-based 
premium rates for pre-firm structures.

SEC. 2. FINDINGS AND PURPOSES.

  (a) Findings.--The Congress finds that--
          (1) flooding has been shown to occur in all 50 States, the 
        District of Columbia, and in all territories and possessions of 
        the United States;
          (2) the national flood insurance program (NFIP) is the only 
        affordable and reliable source of insurance to protect against 
        flood losses;
          (3) the aggregate amount of the flood insurance claims 
        resulting from Hurricane Katrina, Hurricane Rita, and other 
        events has exceeded the aggregate amount of all claims 
        previously paid in the history of the national flood insurance 
        program, requiring a significant increase in the program's 
        borrowing authority;
          (4) flood insurance policyholders have a legitimate 
        expectation that they will receive fair and timely compensation 
        for losses covered under their policies;
          (5) substantial flooding has occurred, and will likely occur 
        again, outside the areas designated by the Federal Emergency 
        Management Agency (FEMA) as high-risk flood hazard areas;
          (6) properties located in low- to moderate-risk areas are 
        eligible to purchase flood insurance policies with premiums as 
        low as $112 a year;
          (7) about 450,000 vacation homes, second homes, and 
        commercial properties are subsidized and are not paying 
        actuarially sound rates for flood insurance;
          (8) phasing out subsidies currently extended to vacation 
        homes, second homes, and commercial properties would result in 
        estimated average annual savings to the taxpayers of the United 
        States and the national flood insurance program of 
        $335,000,000;
          (9) the maximum coverage limits for flood insurance policies 
        should be increased to reflect inflation and the increased cost 
        of housing;
          (10) significant reforms to the national flood insurance 
        program required in the Bunning-Bereuter-Blumenauer Flood 
        Insurance Reform Act of 2004 have yet to be implemented; and
          (11) in addition to reforms required in the Bunning-Bereuter-
        Blumenauer Flood Insurance Reform Act of 2004, the national 
        flood insurance program requires a modernized and updated 
        administrative model to ensure that the program is solvent and 
        the people of the United States have continued access to flood 
        insurance.
  (b) Purposes.--The purposes of this Act are--
          (1) to protect the integrity of the national flood insurance 
        program by fully funding existing legal obligations expected by 
        existing policyholders who have paid policy premiums in return 
        for flood insurance coverage and to pay debt service on funds 
        borrowed by the NFIP;
          (2) to increase incentives for homeowners and communities to 
        participate in the national flood insurance program and to 
        improve oversight to ensure better accountability of the NFIP 
        and FEMA;
          (3) to increase awareness of homeowners of flood risks and 
        improve the quality of information regarding such risks 
        provided to homeowners; and
          (4) to provide for the national flood insurance program to 
        make available optional multiperil insurance coverage against 
        loss resulting from physical damage to or loss of real or 
        personal property arising from any flood or windstorm.

SEC. 3. STUDY REGARDING STATUS OF PRE-FIRM PROPERTIES AND MANDATORY 
                    PURCHASE REQUIREMENT FOR NATURAL 100-YEAR 
                    FLOODPLAIN AND NON-FEDERALLY RELATED LOANS.

  (a) In General.--The Comptroller General shall conduct a study as 
follows:
          (1) Pre-firm properties.--The study shall determine the 
        status of the national flood insurance program, as of the date 
        of the enactment of this Act, with respect to the provision of 
        flood insurance coverage for pre-FIRM properties (as such term 
        is defined in section 578(b) of the National Flood Insurance 
        Reform Act of 1994 (42 U.S.C. 4014 note)), which shall include 
        determinations of--
                  (A) the number of pre-FIRM properties for which 
                coverage is provided and the extent of such coverage;
                  (B) the cost of providing coverage for such pre-FIRM 
                properties to the national flood insurance program;
                  (C) the anticipated rate at which such pre-FIRM 
                properties will cease to be covered under the program; 
                and
                  (D) the effects that implementation of the Bunning-
                Bereuter-Blumenauer Flood Insurance Reform Act of 2004 
                will have on the national flood insurance program 
                generally and on coverage of pre-FIRM properties under 
                the program.
          (2) Mandatory purchase requirement for natural 100-year 
        floodplain.--The study shall assess the impact, effectiveness, 
        and feasibility of amending the provisions of the Flood 
        Disaster Protection Act of 1973 regarding the properties that 
        are subject to the mandatory flood insurance coverage purchase 
        requirements under such Act to extend such requirements to 
        properties located in any area that would be designated as an 
        area having special flood hazards but for the existence of a 
        structural flood protection system, and shall determine--
                  (A) the regulatory, financial and economic impacts of 
                extending such mandatory purchase requirements on the 
                costs of homeownership, the actuarial soundness of the 
                national flood insurance program, the Federal Emergency 
                Management Agency, local communities, insurance 
                companies, and local land use;
                  (B) the effectiveness of extending such mandatory 
                purchase requirements in protecting homeowners from 
                financial loss and in protecting the financial 
                soundness of the national flood insurance program; and
                  (C) any impact on lenders of complying with or 
                enforcing such extended mandatory requirements.
          (3) Mandatory purchase requirement for non-federally related 
        loans.--The study shall assess the impact, effectiveness, and 
        feasibility of, and basis under the Constitution of the United 
        States for, amending the provisions of the Flood Disaster 
        Protection Act of 1973 regarding the properties that are 
        subject to the mandatory flood insurance coverage purchase 
        requirements under such Act to extend such requirements to any 
        property that is located in any area having special flood 
        hazards and which secures the repayment of a loan that is not 
        described in paragraph (1), (2), or (3) of section 102(b) of 
        such Act, and shall determine how best to administer and 
        enforce such a requirement, taking into consideration other 
        insurance purchase requirements under Federal and State law.
  (b) Report.--The Comptroller General shall submit a report to the 
Congress regarding the results and conclusions of the study under this 
subsection not later than the expiration of the 6-month period 
beginning on the date of the enactment of this Act.

SEC. 4. PHASE-IN OF ACTUARIAL RATES FOR NONRESIDENTIAL PROPERTIES AND 
                    NON-PRIMARY RESIDENCES.

  (a) In General.--Section 1308(c) of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4015(c)) is amended--
          (1) by redesignating paragraph (2) as paragraph (4); and
          (2) by inserting after paragraph (1) the following new 
        paragraphs:
          ``(2) Nonresidential properties.--Any nonresidential 
        property, which term shall not include any multifamily rental 
        property that consists of four or more dwelling units.
          ``(3) Non-primary residences.--Any residential property that 
        is not the primary residence of any individual, including the 
        owner of the property or any other individual who resides in 
        the property as a tenant.''.
  (b) Technical Amendments.--Section 1308 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4015) is amended--
          (1) in subsection (c)--
                  (A) in the matter preceding paragraph (1), by 
                striking ``the limitations provided under paragraphs 
                (1) and (2)'' and inserting ``subsection (e)''; and
                  (B) in paragraph (1), by striking ``, except'' and 
                all that follows through ``subsection (e)''; and
          (2) in subsection (e), by striking ``paragraph (2) or (3)'' 
        and inserting ``paragraph (4)''.
  (c) Effective Date and Transition.--
          (1) Effective date.--The amendments made by subsections (a) 
        and (b) shall apply beginning on January 1, 2011, except as 
        provided in paragraph (2) of this subsection.
          (2) Transition for properties covered by flood insurance upon 
        effective date.--
                  (A) Increase of rates over time.--In the case of any 
                property described in paragraph (2) or (3) of section 
                1308(c) of the National Flood Insurance Act of 1968, as 
                amended by subsection (a) of this section, that, as of 
                the effective date under paragraph (1) of this 
                subsection, is covered under a policy for flood 
                insurance made available under the national flood 
                insurance program for which the chargeable premium 
                rates are less than the applicable estimated risk 
                premium rate under section 1307(a)(1) for the area in 
                which the property is located, the Director of the 
                Federal Emergency Management Agency shall increase the 
                chargeable premium rates for such property over time to 
                such applicable estimated risk premium rate under 
                section 1307(a)(1).
                  (B) Annual increase.--Such increase shall be made by 
                increasing the chargeable premium rates for the 
                property (after application of any increase in the 
                premium rates otherwise applicable to such property), 
                once during the 12-month period that begins upon the 
                effective date under paragraph (1) of this subsection 
                and once every 12 months thereafter until such increase 
                is accomplished, by 15 percent (or such lesser amount 
                as may be necessary so that the chargeable rate does 
                not exceed such applicable estimated risk premium rate 
                or to comply with subparagraph (C)). Any increase in 
                chargeable premium rates for a property pursuant to 
                this paragraph shall not be considered for purposes of 
                the limitation under section 1308(e) of such Act.
                  (C) Properties subject to phase-in and annual 
                increases.--In the case of any pre-FIRM property (as 
                such term is defined in section 578(b) of the National 
                Flood Insurance Reform Act of 1974), the aggregate 
                increase, during any 12-month period, in the chargeable 
                premium rate for the property that is attributable to 
                this paragraph or to an increase described in section 
                1308(e) of the National Flood Insurance Act of 1968 may 
                not exceed the following percentage:
                          (i) Nonresidential properties.--In the case 
                        of any property described in such section 
                        1308(c)(2), 20 percent.
                          (ii) Non-primary residences.--In the case of 
                        any property described in such section 
                        1308(c)(3), 25 percent.
                  (D) Full actuarial rates.--The provisions of 
                paragraphs (2) and (3) of such section 1308(c) shall 
                apply to such a property upon the accomplishment of the 
                increase under this paragraph and thereafter.

SEC. 5. EXCEPTION TO WAITING PERIOD FOR EFFECTIVE DATE OF POLICIES.

  Section 1306(c)(2)(A) of the National Flood Insurance Act of 1968 (42 
U.S.C. 4013(c)(2)(A)) is amended by inserting before the semicolon the 
following: ``or is in connection with the purchase or other transfer of 
the property for which the coverage is provided (regardless of whether 
a loan is involved in the purchase or transfer transaction), but only 
when such initial purchase of coverage is made not later 30 days after 
such making, increasing, extension, or renewal of the loan or not later 
than 30 days after such purchase or other transfer of the property, as 
applicable''.

SEC. 6. ENFORCEMENT.

  Section 102(f) of the Flood Disaster Protection Act of 1973 (42 
U.S.C. 4012a(f)) is amended--
          (1) in paragraph (5)--
                  (A) in the first sentence, by striking ``$350'' and 
                inserting ``$2,000''; and
                  (B) in the last sentence, by striking ``$100,000'' 
                and inserting ``$1,000,000; except that such limitation 
                shall not apply to a regulated lending institution or 
                enterprise for a calendar year if, in any three (or 
                more) of the five calendar years immediately preceding 
                such calendar year, the total amount of penalties 
                assessed under this subsection against such lending 
                institution or enterprise was $1,000,000''; and
          (2) in paragraph (6), by adding after the period at the end 
        the following: ``No penalty may be imposed under this 
        subsection on a regulated lending institution or enterprise 
        that has made a good faith effort to comply with the 
        requirements of the provisions referred to in paragraph (2) or 
        for any non-material violation of such requirements.''.

SEC. 7. MULTIPERIL COVERAGE FOR FLOOD AND WINDSTORM.

  (a) In General.--Section 1304 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4011) is amended--
          (1) by redesignating subsection (c) as subsection (d); and
          (2) by inserting after subsection (b) the following new 
        subsection:
  ``(c) Multiperil Coverage for Damage From Flood or Windstorm.--
          ``(1) In general.--Subject to paragraph (8), the national 
        flood insurance program established pursuant to subsection (a) 
        shall enable the purchase of optional insurance against loss 
        resulting from physical damage to or loss of real property or 
        personal property related thereto located in the United States 
        arising from any flood or windstorm, subject to the limitations 
        in this subsection and section 1306(b).
          ``(2) Community participation requirement.--Multiperil 
        coverage pursuant to this subsection may not be provided in any 
        area (or subdivision thereof) unless an appropriate public body 
        shall have adopted adequate land use and control measures (with 
        effective enforcement provisions) which the Director finds are 
        consistent with the comprehensive criteria for land management 
        and use relating to windstorms establish pursuant to section 
        1361(d)(2).
          ``(3) Prohibition against duplicative coverage.--Multiperil 
        coverage pursuant to this subsection may not be provided with 
        respect to any structure (or the personal property related 
        thereto) for any period during which such structure is covered, 
        at any time, by flood insurance coverage made available under 
        this title.
          ``(4) Nature of coverage.--Multiperil coverage pursuant to 
        this subsection shall--
                  ``(A) cover losses only from physical damage 
                resulting from flooding or windstorm; and
                  ``(B) provide for approval and payment of claims 
                under such coverage upon proof that such loss must have 
                resulted from either windstorm or flooding, but shall 
                not require for approval and payment of a claim that 
                the specific cause of the loss, whether windstorm or 
                flooding, be distinguished or identified.
          ``(5) Actuarial rates.--Multiperil coverage pursuant to this 
        subsection shall be made available for purchase for a property 
        only at chargeable risk premium rates that, based on 
        consideration of the risks involved and accepted actuarial 
        principles, and including operating costs and allowance and 
        administrative expenses, are required in order to make such 
        coverage available on an actuarial basis for the type and class 
        of properties covered.
          ``(6) Terms of coverage.--The Director shall, after 
        consultation with persons and entities referred to in section 
        1306(a), provide by regulation for the general terms and 
        conditions of insurability which shall be applicable to 
        properties eligible for multiperil coverage under this 
        subsection, subject to the provisions of this subsection, 
        including--
                  ``(A) the types, classes, and locations of any such 
                properties which shall be eligible for such coverage, 
                which shall include residential and nonresidential 
                properties;
                  ``(B) subject to paragraph (7), the nature and limits 
                of loss or damage in any areas (or subdivisions 
                thereof) which may be covered by such coverage;
                  ``(C) the classification, limitation, and rejection 
                of any risks which may be advisable;
                  ``(D) appropriate minimum premiums;
                  ``(E) appropriate loss deductibles; and
                  ``(F) any other terms and conditions relating to 
                insurance coverage or exclusion that may be necessary 
                to carry out this subsection.
          ``(7) Limitations on amount of coverage.--The regulations 
        issued pursuant to paragraph (6) shall provide that the 
        aggregate liability under multiperil coverage made available 
        under this subsection shall not exceed the lesser of the 
        replacement cost for covered losses or the following amounts, 
        as applicable:
                  ``(A) Residential structures.--In the case of 
                residential properties--
                          ``(i) for any single-family dwelling, 
                        $500,000; and
                          ``(ii) for any structure containing more than 
                        one dwelling unit, $500,000 for each separate 
                        dwelling unit in the structure; and
                          ``(iii) $150,000 per dwelling unit for--
                                  ``(I) any contents related to such 
                                unit; and
                                  ``(II) any necessary increases in 
                                living expenses incurred by the insured 
                                when losses from flooding or windstorm 
                                make the residence unfit to live in.
                  ``(B) Nonresidential properties.--In the case of 
                nonresidential properties (including church 
                properties)--
                          ``(i) $1,000,000 for any single structure; 
                        and
                          ``(ii) $750,000 for--
                                  ``(I) any contents related to such 
                                structure;
                                  ``(II) in the case of any 
                                nonresidential property that is a 
                                business property, any losses resulting 
                                from any partial or total interruption 
                                of the insured's business caused by 
                                damage to, or loss of, such property 
                                from flooding or windstorm, except that 
                                for purposes of such coverage, losses 
                                shall be determined based on the 
                                profits the covered business would have 
                                earned, based on previous financial 
                                records, had the flood or windstorm not 
                                occurred.
          ``(8) Requirement to cease offering coverage if borrowing to 
        pay claims.--If at any time the Director utilizes the borrowing 
        authority under section 1309(a) for the purpose of obtaining 
        amounts to pay claims under multiperil coverage made available 
        under this subsection, the Director may not, during the period 
        beginning upon the initial such use of such borrowing authority 
        and ending upon repayment to the Secretary of the Treasury of 
        the full amount of all outstanding notes and obligations issued 
        by the Director for such purpose, together with all interest 
        owed on such notes and obligations, enter into any new policy, 
        or renew any existing policy, for coverage made available under 
        this subsection.
          ``(9) Effective date.--This subsection shall take effect on, 
        and shall apply beginning on, June 30, 2008.''.
  (b) Prohibition Against Duplicative Coverage.--The National Flood 
Insurance Act of 1968 is amended by inserting after section 1313 (42 
U.S.C. 4020) the following new section:
               ``prohibition against duplicative coverage
  ``Sec. 1314.  Flood insurance under this title may not be provided 
with respect to any structure (or the personal property related 
thereto) for any period during which such structure is covered, at any 
time, by multiperil insurance coverage made available pursuant to 
section 1304(c).''.
  (c) Compliance With State and Local Law.--Section 1316 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4023) is amended--
          (1) by inserting ``(a) Flood Protection Measures.--'' before 
        ``No new''; and
          (2) by adding at the end the following new subsection:
  ``(b) Windstorm Protection Measures.--No new multiperil coverage 
shall be provided under section 1304(c) for any property that the 
Director finds has been declared by a duly constituted State or local 
zoning authority, or other authorized public body to be in violation of 
State or local laws, regulations, or ordinances, which are intended to 
reduce damage caused by windstorms.''.
  (d) Criteria for Land Management and Use.--Section 1361 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4102) is amended by 
adding at the end the following new subsection:
  ``(d) Windstorms.--
          ``(1) Studies and investigations.--The Director shall carry 
        out studies and investigations under this section to determine 
        appropriate measures in windstorm-prone areas as to land 
        management and use, windstorm zoning, and windstorm damage 
        prevention, and may enter into contracts, agreements, and other 
        appropriate arrangements to carry out such activities. Such 
        studies and investigations shall include laws, regulations, and 
        ordinance relating to the orderly development and use of areas 
        subject to damage from windstorm risks, and zoning building 
        codes, building permits, and subdivision and other building 
        restrictions for such areas.
          ``(2) Criteria.--On the basis of the studies and 
        investigations pursuant to paragraph (1) and such other 
        information as may be appropriate, the Direct shall establish 
        comprehensive criteria designed to encourage, where necessary, 
        the adoption of adequate State and local measures which, to the 
        maximum extent feasible, will assist in reducing damage caused 
        by windstorms.
          ``(3) Coordination with state and local governments.--The 
        Director shall work closely with and provide any necessary 
        technical assistance to State, interstate, and local 
        governmental agencies, to encourage the application of criteria 
        established under paragraph (2) and the adoption and 
        enforcement of measures referred to in such paragraph.''.
  (e) Definitions.--Section 1370 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4121) is amended--
          (1) in paragraph (14), by striking ``and'' at the end;
          (2) in paragraph (15) by striking the period at the end and 
        inserting ``; and''; and
          (3) by adding at the end the following new paragraph:
          ``(16) the term `windstorm' means any hurricane, tornado, 
        cyclone, typhoon, or other wind event.''.

SEC. 8. MAXIMUM COVERAGE LIMITS.

  Subsection (b) of section 1306 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4013(b)) is amended--
          (1) in paragraph (2), by striking ``$250,000'' and inserting 
        ``$335,000'';
          (2) in paragraph (3), by striking ``$100,000'' and inserting 
        ``$135,000''; and
          (3) in paragraph (4), by striking ``$500,000'' each place 
        such term appears and inserting ``$670,000''.

SEC. 9. COVERAGE FOR ADDITIONAL LIVING EXPENSES, BASEMENT IMPROVEMENTS, 
                    BUSINESS INTERRUPTION, AND REPLACEMENT COST OF 
                    CONTENTS.

  Subsection (b) of section 1306 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4013) is amended--
          (1) in paragraph (4), by striking ``and'' at the end;
          (2) in paragraph (5)--
                  (A) by inserting ``pursuant to paragraph (2), (3), or 
                (4)'' after ``any flood insurance coverage''; and
                  (B) by striking the period at the end and inserting a 
                semicolon; and
          (3) by adding at the end the following new paragraphs:
          ``(6) in the case of any residential property, each renewal 
        or new contract for flood insurance coverage shall provide not 
        less than $1,000 aggregate liability per dwelling unit for any 
        necessary increases in living expenses incurred by the insured 
        when losses from a flood make the residence unfit to live in, 
        which coverage shall be available only at chargeable rates that 
        are not less than the estimated premium rates for such coverage 
        determined in accordance with section 1307(a)(1);
          ``(7) in the case of any residential property, optional 
        coverage for additional living expenses described in paragraph 
        (6) shall be made available to every insured upon renewal and 
        every applicant in excess of the limits provided in paragraph 
        (6) in such amounts and at such rates as the Director shall 
        establish, except that such chargeable rates shall not be less 
        than the estimated premium rates for such coverage determined 
        in accordance with section 1307(a)(1);
          ``(8) in the case of any residential property, optional 
        coverage for losses, resulting from floods, to improvements and 
        personal property located in basements, crawl spaces, and other 
        enclosed areas under buildings that are not covered by primary 
        flood insurance coverage under this title, shall be made 
        available to every insured upon renewal and every applicant, 
        except that such coverage shall be made available only at 
        chargeable rates that are not less than the estimated premium 
        rates for such coverage determined in accordance with section 
        1307(a)(1);
          ``(9) in the case of any commercial property or other 
        residential property, including multifamily rental property, 
        optional coverage for losses resulting from any partial or 
        total interruption of the insured's business caused by damage 
        to, or loss of, such property from a flood shall be made 
        available to every insured upon renewal and every applicant, 
        except that--
                  ``(A) for purposes of such coverage, losses shall be 
                determined based on the profits the covered business 
                would have earned, based on previous financial records, 
                had the flood not occurred; and
                  ``(B) such coverage shall be made available only at 
                chargeable rates that are not less than the estimated 
                premium rates for such coverage determined in 
                accordance with section 1307(a)(1); and
          ``(10) in the case of any residential property and any 
        commercial property, optional coverage for the full replacement 
        costs of any contents related to the structure that exceed the 
        limits of coverage otherwise provided in this subsection shall 
        be made available to every insured upon renewal and every 
        applicant, except that such coverage shall be made available 
        only at chargeable rates that are not less than the estimated 
        premium rates for such coverage determined in accordance with 
        section 1307(a)(1).''.

SEC. 10. NOTIFICATION TO TENANTS OF AVAILABILITY OF CONTENTS INSURANCE.

  The National Flood Insurance Act of 1968 is amended by inserting 
after section 1308 (42 U.S.C. 4015) the following new section:

``SEC. 1308A. NOTIFICATION TO TENANTS OF AVAILABILITY OF CONTENTS 
                    INSURANCE.

  ``(a) In General.--The Director shall, upon entering into a contract 
for flood insurance coverage under this title for any property located 
in an area having special flood hazards--
          ``(1) provide to the insured sufficient copies of the notice 
        developed pursuant to subsection (b); and
          ``(2) strongly encourage the insured to provide a copy of the 
        notice, or otherwise provide notification of the information 
        under subsection (b) in the manner that the manager or landlord 
        deems most appropriate, to each such tenant and to each new 
        tenant upon commencement of such a tenancy.
  ``(b) Notice.--Notice to a tenant of a property in accordance with 
this subsection is written notice that clearly informs a tenant--
          ``(1) that the property is located in an area having special 
        flood hazards;
          ``(2) that flood insurance coverage is available under the 
        national flood insurance program under this title for contents 
        of the unit or structure leased by the tenant;
          ``(3) of the maximum amount of such coverage for contents 
        available under this title at that time; and
          ``(4) of where to obtain information regarding how to obtain 
        such coverage, including a telephone number, mailing address, 
        and location on the World Wide Web of the Director where such 
        information is available.''.

SEC. 11. INCREASE IN ANNUAL LIMITATION ON PREMIUM INCREASES.

  Section 1308(e) of the National Flood Insurance Act of 1968 (42 
U.S.C. 4015(e)) is amended by striking ``10 percent'' and inserting 
``15 percent''.

SEC. 12. INCREASE IN BORROWING AUTHORITY.

  (a) Borrowing Authority.--The first sentence of subsection (a) of 
section 1309 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4016(a)), as amended by the National Flood Insurance Program Further 
Enhanced Borrowing Authority Act of 2005 (Public Law 109-106; 119 Stat. 
2288), is amended by striking ``$20,775,000,000'' and inserting 
``$21,500,000,000''.
  (b) FEMA Report.--Not later than the expiration of the 6-month period 
beginning on the date of the enactment of this Act, the Director of the 
Federal Emergency Management Agency shall submit a report to the 
Congress setting forth a plan for repaying within 10 years all amounts, 
including any amounts previously borrowed but not yet repaid, pursuant 
to increase in borrowing authority authorized under the amendments made 
by subsection (a).

SEC. 13. FEMA PARTICIPATION IN STATE DISASTER CLAIMS MEDIATION 
                    PROGRAMS.

  Chapter I of the National Flood Insurance Act of 1968 (42 U.S.C. 4011 
et seq.) is amended by adding at the end the following new section:

``SEC. 1325. FEMA PARTICIPATION IN STATE DISASTER CLAIMS MEDIATION 
                    PROGRAMS.

  ``(a) Requirement to Participate.--In the case of the occurrence of a 
natural catastrophe that may have resulted in flood damage covered by 
insurance made available under the national flood insurance program and 
a loss covered by personal lines residential property insurance policy, 
upon request made by the insurance commissioner of a State (or such 
other official responsible for regulating the business of insurance in 
the State) for the participation of representatives of the Director in 
a program sponsored by such State for nonbinding mediation of insurance 
claims resulting from a natural catastrophe, the Director shall cause 
such representatives to participate in such State program, when claims 
under the national flood insurance program are involved, to expedite 
settlement of flood damage claims resulting from such catastrophe.
  ``(b) Extent of Participation.--Participation by representatives of 
the Director required under subsection (a) with respect to flood damage 
claims resulting from a natural catastrophe shall include--
          ``(1) providing adjusters certified for purposes of the 
        national flood insurance program who are authorized to settle 
        claims against such program resulting from such catastrophe in 
        amounts up to the limits of policies under such program;
          ``(2) requiring such adjusters to attend State-sponsored 
        mediation meetings regarding flood insurance claims resulting 
        from such catastrophe at times and places as may be arranged by 
        the State;
          ``(3) participating in good-faith negotiations toward the 
        settlement of such claims with policyholders of coverage made 
        available under the national flood insurance program; and
          ``(4) finalizing the settlement of such claims on behalf of 
        the national flood insurance program with such policyholders.
  ``(c) Coordination.--Representatives of the Director who participate 
pursuant to this section in a State-sponsored mediation program with 
respect to a natural catastrophe shall at all times coordinate their 
activities with insurance officials of the State and representatives of 
insurers for the purpose of consolidating and expediting the settlement 
of claims under the national flood insurance program resulting from 
such catastrophe at the earliest possible time.
  ``(d) Mediation Proceedings and Privileged Documents.--As a condition 
of the participation of Representatives of the Director pursuant to 
this section in State-sponsored mediation, all statements made and 
documents produced pursuant to such mediation involving representatives 
of the Director shall be deemed privileged and confidential settlement 
negotiations made in anticipation of litigation.
  ``(e) Effect of Participation on Liability, Right, and Obligations.--
Participation of Representatives of the Director pursuant to this 
section in State-sponsored mediation shall not affect or expand the 
liability of any party in contract or in tort, nor shall it affect the 
rights or obligations of the parties as provided in the Standard Flood 
Insurance Policy under the national flood insurance program, 
regulations of the Federal Emergency Management Agency, this Act, or 
Federal common law.
  ``(f) Exclusive Federal Jurisdiction.--Participation of 
Representatives of the Director pursuant to this section in State-
sponsored mediation shall not alter, change or modify the original 
exclusive jurisdiction of United States courts as provided in this Act.
  ``(g) Cost Limitation.--Nothing in this section shall be construed to 
require the Director or representatives of the Director to pay 
additional mediation fees relating to flood claims associated with a 
State-sponsored mediation program in which representatives of the 
Director participate.
  ``(h) Exception.--In the case of the occurrence of a natural 
catastrophe that results in flood damage claims under the national 
flood insurance program and does not result in any loss covered by a 
personal lines residential property insurance policy--
          ``(1) this section shall not apply; and
          ``(2) the provisions of the Standard Flood Insurance Policy 
        under the national flood insurance program and the appeals 
        process established pursuant to section 205 of the Bunning-
        Bereueter-Blumenauer Flood Insurance Reform Act of 2004 (Public 
        Law 108-264; 118 Stat. 726) and regulations issued pursuant to 
        such section shall apply exclusively.
  ``(i) Representatives of Director.--For purposes of this section, the 
term `representatives of the Director' means representatives of the 
national flood insurance program who participate in the appeals process 
established pursuant to section 205 of the Bunning-Bereueter-Blumenauer 
Flood Insurance Reform Act of 2004 (Public Law 108-264; 118 Stat. 726) 
and regulations issued pursuant to such section.''.

SEC. 14. FEMA ANNUAL REPORT ON INSURANCE PROGRAM.

  Section 1320 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4027) is amended--
          (1) in the section heading, by striking ``report to the 
        president'' and inserting ``annual report to congress'';
          (2) in subsection (a)--
                  (A) by striking ``biennially'';
                  (B) by striking ``the President for submission to''; 
                and
                  (C) by inserting ``not later than June 30 of each 
                year'' before the period at the end;
          (3) in subsection (b), by striking ``biennial'' and inserting 
        ``annual''; and
          (4) by adding at the end the following new subsection:
  ``(c) Financial Status of Program.--The report under this section for 
each year shall include information regarding the financial status of 
the national flood insurance program under this title, including a 
description of the financial status of the National Flood Insurance 
Fund and current and projected levels of claims, premium receipts, 
expenses, and borrowing under the program.''.

SEC. 15. FLOOD INSURANCE OUTREACH.

  (a) Grants.--Chapter I of the National Flood Insurance Act of 1968 
(42 U.S.C. 4011 et seq.), as amended by the preceding provisions of 
this Act, is further amended by adding at the end the following new 
section:

``SEC. 1326. GRANTS FOR OUTREACH TO PROPERTY OWNERS AND RENTERS.

  ``(a) In General.--The Director may, to the extent amounts are made 
available pursuant to subsection (h), make grants to local governmental 
agencies responsible for floodplain management activities (including 
such agencies of Indians tribes, as such term is defined in section 4 
of the Native American Housing Assistance and Self-Determination Act of 
1996 (25 U.S.C. 4103)) in communities that participate in the national 
flood insurance program under this title, for use by such agencies to 
carry out outreach activities to encourage and facilitate the purchase 
of flood insurance protection under this Act by owners and renters of 
properties in such communities and to promote educational activities 
that increase awareness of flood risk reduction.
  ``(b) Outreach Activities.--Amounts from a grant under this section 
shall be used only for activities designed to--
          ``(1) identify owners and renters of properties in 
        communities that participate in the national flood insurance 
        program, including owners of residential and commercial 
        properties;
          ``(2) notify such owners and renters when their properties 
        become included in, or when they are excluded from, an area 
        having special flood hazards and the effect of such inclusion 
        or exclusion on the applicability of the mandatory flood 
        insurance purchase requirement under section 102 of the Flood 
        Disaster Protection Act of 1973 (42 U.S.C. 4012a) to such 
        properties;
          ``(3) educate such owners and renters regarding the flood 
        risk and reduction of this risk in their community, including 
        the continued flood risks to areas that are no longer subject 
        to the flood insurance mandatory purchase requirement;
          ``(4) educate such owners and renters regarding the benefits 
        and costs of maintaining or acquiring flood insurance, 
        including, where applicable, lower-cost preferred risk policies 
        under this title for such properties and the contents of such 
        properties; and
          ``(5) encouraging such owners and renters to maintain or 
        acquire such coverage.
  ``(c) Cost Sharing Requirement.--
          ``(1) In general.--In any fiscal year, the Director may not 
        provide a grant under this section to a local governmental 
        agency in an amount exceeding 3 times the amount that the 
        agency certifies, as the Director shall require, that the 
        agency will contribute from non-Federal funds to be used with 
        grant amounts only for carrying out activities described in 
        subsection (b).
          ``(2) Non-federal funds.--For purposes of this subsection, 
        the term `non-Federal funds' includes State or local government 
        agency amounts, in-kind contributions, any salary paid to staff 
        to carry out the eligible activities of the grant recipient, 
        the value of the time and services contributed by volunteers to 
        carry out such services (at a rate determined by the Director), 
        and the value of any donated material or building and the value 
        of any lease on a building.
  ``(d) Administrative Cost Limitation.--Notwithstanding subsection 
(b), the Director may use not more than 5 percent of amounts made 
available under subsection (g) to cover salaries, expenses, and other 
administrative costs incurred by the Director in making grants and 
provide assistance under this section.
  ``(e) Application and Selection.--
          ``(1) In general.--The Director shall provide for local 
        governmental agencies described in subsection (a) to submit 
        applications for grants under this section and for competitive 
        selection, based on criteria established by the Director, of 
        agencies submitting such applications to receive such grants.
          ``(2) Selection considerations.--In selecting applications of 
        local government agencies to receive grants under paragraph 
        (1), the Director shall consider--
                  ``(A) the existence of a cooperative technical 
                partner agreement between the local governmental agency 
                and the Federal Emergency Management Agency;
                  ``(B) the history of flood losses in the relevant 
                area that have occurred to properties, both inside and 
                outside the special flood hazards zones, which are not 
                covered by flood insurance coverage;
                  ``(C) the estimated percentage of high-risk 
                properties located in the relevant area that are not 
                covered by flood insurance;
                  ``(D) demonstrated success of the local governmental 
                agency in generating voluntary purchase of flood 
                insurance; and
                  ``(E) demonstrated technical capacity of the local 
                governmental agency for outreach to individual property 
                owners.
  ``(f) Direct Outreach by FEMA.--In each fiscal year that amounts for 
grants are made available pursuant to subsection (h), the Director may 
use not more than 50 percent of such amounts to carry out, and to enter 
into contracts with other entities to carry out, activities described 
in subsection (b) in areas that the Director determines have the most 
immediate need for such activities.
  ``(g) Reporting.--Each local government agency that receives a grant 
under this section, and each entity that receives amounts pursuant to 
subsection (f), shall submit a report to the Director, not later than 
12 months after such amounts are first received, which shall include 
such information as the Director considers appropriate to describe the 
activities conducted using such amounts and the effect of such 
activities on the retention or acquisition of flood insurance coverage.
  ``(h) Authorization of Appropriations.--There is authorized to be 
appropriated for grants under this section $50,000,000 for each of 
fiscal years 2008 through 2012.''.
  (b) Report on Current Efforts.--Not later than the expiration of the 
60-day period beginning on the date of the enactment of this Act, the 
Director of the Federal Emergency Management Agency shall submit a 
report to the Congress identifying and describing the marketing and 
outreach efforts then currently being undertaken to educate consumers 
regarding the benefits of obtaining coverage under the national flood 
insurance program.

SEC. 16. GRANTS FOR DIRECT FUNDING OF MITIGATION ACTIVITIES FOR 
                    INDIVIDUAL REPETITIVE CLAIMS PROPERTIES.

  (a) Direct Grants to Owners.--Section 1323 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4030) is amended--
          (1) in the section heading, by inserting 
        ``direct'' before ``grants''; and
          (2) in the matter in subsection (a) that precedes paragraph 
        (1)--
                  (A) by inserting ``, to owners of such properties,'' 
                before ``for mitigation actions''; and
                  (B) by striking ``1'' and inserting ``two''.
  (b) Availability of Funds.--Paragraph (9) of section 1310(a) of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4017(a)) is amended by 
inserting ``which shall remain available until expended,'' after ``any 
fiscal year,''.

SEC. 17. EXTENSION OF PILOT PROGRAM FOR MITIGATION OF SEVERE REPETITIVE 
                    LOSS PROPERTIES.

  Section 1361A of the National Flood Insurance Act of 1968 (42 U.S.C. 
4102a) is amended--
          (1) in subsection (k)(1), by striking ``2005, 2006, 2007, 
        2008, and 2009'' and inserting ``2008, 2009, 2010, 2011, and 
        2012''; and
          (2) by striking subsection (l).

SEC. 18. FLOOD MITIGATION ASSISTANCE PROGRAM.

  (a) Eligibility of Property Demolition and Rebuilding.--Section 
1366(e)(5)(B) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4104c(e)(5)(B)) is amended by striking ``or floodproofing'' and 
inserting ``floodproofing, or demolition and rebuilding''.
  (b) Elimination of Limitations on Aggregate Amount of Assistance.--
Section 1366 of the National Flood Insurance Act of 1968 is amended by 
striking subsection (f).
  (c) Source of Funds.--Subsection (a) of section 1367 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4104d(a)) is amended by adding 
at the end the following new sentence: ``Notwithstanding any other 
provision of this title, amounts made available pursuant to this 
subsection shall not be subject to offsetting collections through 
premium rates for flood insurance coverage under this title.''.
  (d) Technical Amendments.--Section 1366 of the National Flood 
Insurance Act of 1968 is amended--
          (1) by striking ``subsection (g)'' each place such term 
        appears in subsections (h) and (i)(2) and inserting 
        ``subsection (f)'';
          (2) by redesignating subsections (g) through (k) as 
        subsections (f) through (j), respectively; and
          (3) by redesignating subsection (m) as subsection (k).

SEC. 19. GAO STUDY OF METHODS TO INCREASE FLOOD INSURANCE PROGRAM 
                    PARTICIPATION BY LOW-INCOME FAMILIES.

  (a) In General.--The Comptroller General of the United States shall 
conduct a study to identify and analyze potential methods, practices, 
and incentives that would increase the extent to which low-income 
families (as such term is defined in section 3(b) of the United States 
Housing Act of 1937 (42 U.S.C. 1437a(b))) that own residential 
properties located within areas having special flood hazards purchase 
flood insurance coverage for such properties under the national flood 
insurance program. In conducting the study, the Comptroller General 
shall analyze the effectiveness and costs of the various methods, 
practices, and incentives identified, including their effects on the 
national flood insurance program.
  (b) Report.--The Comptroller General shall submit to the Congress a 
report setting forth the conclusions of the study under this section 
not later than 12 months after the date of the enactment of this Act.

SEC. 20. NOTICE OF AVAILABILITY OF FLOOD INSURANCE AND ESCROW IN RESPA 
                    GOOD FAITH ESTIMATE.

  Subsection (c) of section 5 of the Real Estate Settlement Procedures 
Act of 1974 (12 U.S.C. 2604(c)) is amended by adding at the end the 
following new sentence: ``Each such good faith estimate shall include 
the following conspicuous statements and information: (1) that flood 
insurance coverage for residential real estate is generally available 
under the national flood insurance program whether or not the real 
estate is located in an area having special flood hazards and that, to 
obtain such coverage, a home owner or purchaser should contact the 
national flood insurance program; (2) a telephone number and a location 
on the World Wide Web by which a home owner or purchaser can contact 
the national flood insurance program; and (3) that the escrowing of 
flood insurance payments is required for many loans under section 
102(d) of the Flood Disaster Protection Act of 1973, and may be a 
convenient and available option with respect to other loans.''.

SEC. 21. REITERATION OF FEMA RESPONSIBILITIES UNDER 2004 REFORM ACT.

  (a) Appeals Process.--As directed in section 205 of the Bunning-
Bereuter-Blumenauer Flood Insurance Reform Act of 2004 (42 U.S.C. 4011 
note), the Director of the Federal Emergency Management Agency is again 
directed to, not later than 90 days after the date of the enactment of 
this Act, establish an appeals process through which holders of a flood 
insurance policy may appeal the decisions, with respect to claims, 
proofs of loss, and loss estimates relating to such flood insurance 
policy as required by such section.
  (b) Minimum Training and Education Requirements.--The Director of the 
Federal Emergency Management Agency is directed to continue to work 
with the insurance industry, State insurance regulators, and other 
interested parties to implement the minimum training and education 
standards for all insurance agents who sell flood insurance policies 
that were established by the Director under the notice published 
September 1, 2005 (70 Fed. Reg. 52117) pursuant to section 207 of the 
Bunning-Bereuter-Blumenauer Flood Insurance Reform Act of 2004 (42 
U.S.C. 4011 note).
  (c) Report.--Not later than the expiration of the 6-month period 
beginning on the date of the enactment of this Act, the Director of the 
Federal Emergency Management Agency shall submit a report to the 
Congress describing the implementation of each provision of the 
Bunning-Bereuter-Blumenauer Flood Insurance Reform Act of 2004 (Public 
Law 108-264) and identifying each regulation, order, notice, and other 
material issued by the Director in implementing each such provision.

SEC. 22. ONGOING MODERNIZATION OF FLOOD MAPS AND ELEVATION STANDARDS.

  (a) Ongoing Flood Mapping Program.--Section 1360 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4101) is amended by adding at 
the end the following new subsection:
  ``(k) Ongoing Program To Review, Update, and Maintain Flood Insurance 
Program Maps.--
          ``(1) In general.--The Director, in coordination with the 
        Technical Mapping Advisory Council established pursuant to 
        section 576 of the National Flood Insurance Reform Act of 1994 
        (42 U.S.C. 4101 note) and section 22(b) of the Flood Insurance 
        Reform and Modernization Act of 2007, shall establish an 
        ongoing program under which the Director shall review, update, 
        and maintain national flood insurance program rate maps in 
        accordance with this subsection.
          ``(2) Inclusions.--
                  ``(A) Covered areas.--Each map updated under this 
                subsection shall include a depiction of--
                          ``(i) the 500-year floodplain;
                          ``(ii) areas that could be inundated as a 
                        result of the failure of a levee, as determined 
                        by the Director; and
                          ``(iii) areas that could be inundated as a 
                        result of the failure of a dam, as identified 
                        under the National Dam Safety Program Act (33 
                        U.S.C. 467 et seq.).
                  ``(B) Other inclusions.--In updating maps under this 
                subsection, the Director may include--
                          ``(i) any relevant information on coastal 
                        inundation from--
                                  ``(I) an applicable inundation map of 
                                the Corps of Engineers; and
                                  ``(II) data of the National Oceanic 
                                and Atmospheric Administration relating 
                                to storm surge modeling;
                          ``(ii) any relevant information of the 
                        Geographical Service on stream flows, watershed 
                        characteristics, and topography that is useful 
                        in the identification of flood hazard areas, as 
                        determined by the Director; and
                          ``(iii) a description of any hazard that 
                        might impact flooding, including, as determined 
                        by the Director--
                                  ``(I) land subsidence and coastal 
                                erosion areas;
                                  ``(II) sediment flow areas;
                                  ``(III) mud flow areas;
                                  ``(IV) ice jam areas; and
                                  ``(V) areas on coasts and inland that 
                                are subject to the failure of 
                                structural protective works, such as 
                                levees, dams, and floodwalls.
          ``(3) Standards.--In updating and maintaining maps under this 
        subsection, the Director shall establish standards to--
                  ``(A) ensure that maps are adequate for--
                          ``(i) flood risk determinations; and
                          ``(ii) use by State and local governments in 
                        managing development to reduce the risk of 
                        flooding;
                  ``(B) facilitate the Director, in conjunction with 
                State and local governments, to identify and use 
                consistent methods of data collection and analysis in 
                developing maps for communities with similar flood 
                risks, as determined by the Director; and
                  ``(C) ensure that emerging weather forecasting 
                technology is used, where practicable, in flood map 
                evaluations and the identification of potential risk 
                areas.
          ``(4) Hurricanes katrina and rita mapping priority.--In 
        updating and maintaining maps under this subsection, the 
        Director shall--
                  ``(A) give priority to the updating and maintenance 
                of maps of coastal areas affected by Hurricane Katrina 
                or Hurricane Rita to provide guidance with respect to 
                hurricane recovery efforts; and
                  ``(B) use the process of updating and maintaining 
                maps under subparagraph (A) as a model for updating and 
                maintaining other maps.
          ``(5) Preventing delay of 100-year maps.--In carrying out 
        this section and this subsection, the Director shall take such 
        actions as may be necessary to ensure that updating and 
        publication of national flood insurance program rate maps to 
        include a depiction of the 500-year floodplain does not in any 
        manner delay the completion or publication of the program rate 
        maps for the 100-year floodplain.
          ``(6) Education program.--The Director shall, after each 
        update to a flood insurance program rate map, in consultation 
        with the chief executive officer of each community affected by 
        the update, conduct a program to educate each such community 
        about the update to the flood insurance program rate map and 
        the effects of the update.
          ``(7) Annual report.--Not later than June 30 of each year, 
        the Director shall submit a report to the Congress describing, 
        for the preceding 12-month period, the activities of the 
        Director under the program under this section and the reviews 
        and updates of flood insurance program rate maps conducted 
        under the program. Each such annual report shall contain the 
        most recent report of the Technical Mapping Advisory Council 
        pursuant to section 576(c)(3) of the National Flood Insurance 
        Reform Act of 1994 (42 U.S.C. 4101 note).
          ``(8) Authorization of appropriations.--There is authorized 
        to be appropriated to the Director to carry out this subsection 
        $400,000,000 for each of fiscal years 2008 through 2013.''.
  (b) Reestablishment of Technical Mapping Advisory Council for Ongoing 
Mapping Program.--
          (1) Reestablishment.--There is reestablished the Technical 
        Mapping Advisory Council, in accordance with this subsection 
        and section 576 of the National Flood Insurance Reform Act of 
        1994 (42 U.S.C. 4101 note).
          (2) Membership.--Paragraph (1) of section 576(b) of the 
        National Flood Insurance Reform Act of 1994 (42 U.S.C. 4101 
        note) is amended--
                  (A) in the matter preceding subparagraph (A), by 
                striking ``10'' and inserting ``14'';
                  (B) by redesignating subparagraphs (E), (F), (G), 
                (H), (I), and (J) as subparagraphs (F), (G), (H), (K), 
                (N), and (O), respectively;
                  (C) by inserting after subparagraph (D) the following 
                new subparagraph:
                  ``(E) a representative of the Corps of Engineers of 
                the United States Army;'';
                  (D) by inserting after subparagraph (H) (as so 
                redesignated by subparagraph (B) of this paragraph) the 
                following new subparagraphs:
                  ``(I) a representative of local or regional flood and 
                stormwater agencies;
                  ``(J) a representative of State geographic 
                information coordinators;''; and
                  (E) by inserting after subparagraph (K) (as so 
                redesignated by subparagraph (B) of this paragraph) the 
                following new subparagraphs:
                  ``(L) a representative of flood insurance servicing 
                companies;
                  ``(M) a real estate professional;''.
          (3) Terms of members and appointment.--Section 576(b) of the 
        National Flood Insurance Reform Act of 1994 (42 U.S.C. 4101 
        note) is amended by adding at the end the following new 
        paragraph:
          ``(3) Terms of members.--
                  ``(A) In general.--Each member of the Council 
                pursuant to any of subparagraphs (B) through (N) of 
                paragraph (1) shall be appointed for a term of 5 years, 
                except as provided in subparagraphs (B) and (C).
                  ``(B) Terms of initial appointees.--As designated by 
                the Director (or the designee of the Director) at the 
                time of appointment, of the members of the Council 
                first appointed pursuant to subparagraph (D)--
                          ``(i) 4 shall be appointed for a term of 1 
                        year;
                          ``(ii) 4 shall be appointed for a term of 3 
                        years; and
                          ``(iii) 5 shall be appointed for a term of 5 
                        years.
                  ``(C) Vacancies.--Any member of the Council appointed 
                to fill a vacancy occurring before the expiration of 
                the term for which the member's predecessor was 
                appointed shall be appointed only for the remainder of 
                that term. A member may serve after the expiration of 
                that member's term until a successor has taken office. 
                A vacancy in the Council shall be filled in the manner 
                in which the original appointment was made.
                  ``(D) Initial appointment.--The Director, or the 
                Director's designee, shall take action as soon as 
                possible after the date of the enactment of the Flood 
                Insurance Reform and Modernization Act of 2007 to 
                appoint the members of the Council pursuant to this 
                subsection.''.
          (4) Duties.--Subsection (c) of section 576 of the National 
        Flood Insurance Reform Act of 1994 (42 U.S.C. 4101 note) is 
        amended to read as follows:
  ``(c) Duties.--The Council shall--
          ``(1) make recommendations to the Director for improvements 
        to the flood map modernization program under section 1360(k) of 
        the National Flood Insurance Act of 1968 (42 U.S.C. 41010(k));
          ``(2) make recommendations to the Director for maintaining a 
        modernized inventory of flood hazard maps and information; and
          ``(3) submit an annual report to the Director that contains a 
        description of the activities and recommendations of the 
        Council.''.
          (5) Elimination of termination.--Section 576 of the National 
        Flood Insurance Reform Act of 1994 (42 U.S.C. 4101 note) is 
        amended by striking subsection (k) and inserting the following 
        new subsection:
  ``(k) Continued Existence.--Section 14(a)(2)(B) of the Federal 
Advisory Committee Act (5 U.S.C. App.; relating to termination of 
advisory committees) shall not apply to the Council.''.
  (c) Post-Disaster Flood Elevation Determinations.--Section 1360 of 
the National Flood Insurance Act of 1968 (42 U.S.C. 4101), as amended 
by the preceding provisions of this Act, is further amended by adding 
at the end the following new subsection:
  ``(l) Interim Post-Disaster Flood Elevations.--
          ``(1) Authority.--Notwithstanding any other provision of this 
        section or section 1363, the Director may, after any flood-
        related disaster, establish by order interim flood elevation 
        requirements for purposes of the national flood insurance 
        program for any areas affected by such flood-related disaster.
          ``(2) Effectiveness.--Such interim elevation requirements for 
        such an area shall take effect immediately upon issuance and 
        may remain in effect until the Director establishes new flood 
        elevations for such area in accordance with section 1363 or the 
        Director provides otherwise.''.
  (d) Updating Upon Request of Community.--Paragraph (2) of section 
1360(f) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4101(f)(2)) is amended by inserting before the period at the end the 
following: ``, except that such a revision or update shall be made at 
no cost to the unit of government making the request if the request is 
being made to reflect repairs and upgrades to dams, levees, or other 
flood control projects under the jurisdiction and responsibility of the 
Federal Government''.

SEC. 23. NOTIFICATION AND APPEAL OF MAP CHANGES; NOTIFICATION OF 
                    ESTABLISHMENT OF FLOOD ELEVATIONS.

  Section 1363 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4104) is amended by striking the section designation and all that 
follows through the end of subsection (a) and inserting the following:
  ``Sec. 1363. (a) In establishing projected flood elevations for land 
use purposes with respect to any community pursuant to section 1361, 
the Director shall first propose such determinations--
          ``(1) by providing the chief executive officer of each 
        community affected by the proposed elevations, by certified 
        mail, with a return receipt requested, notice of the 
        elevations, including a copy of the maps for the elevations for 
        such community and a statement explaining the process under 
        this section to appeal for changes in such elevations;
          ``(2) by causing notice of such elevations to be published in 
        the Federal Register, which notice shall include information 
        sufficient to identify the elevation determinations and the 
        communities affected, information explaining how to obtain 
        copies of the elevations, and a statement explaining the 
        process under this section to appeal for changes in the 
        elevations; and
          ``(3) by publishing in a prominent local newspaper the 
        elevations, a description of the appeals process for flood 
        determinations, and the mailing address and telephone number of 
        a person the owner may contact for more information or to 
        initiate an appeal.''.

SEC. 24. CLARIFICATION OF REPLACEMENT COST PROVISIONS, FORMS, AND 
                    POLICY LANGUAGE.

  Not later than the expiration of the 3-month period beginning on the 
date of the enactment of this Act, the Director of the Federal 
Emergency Management Agency shall--
          (1) in plain language using easy to understand terms and 
        concepts, issue regulations, and revise any materials made 
        available by such Agency, to clarify the applicability of 
        replacement cost coverage under the national flood insurance 
        program;
          (2) in plain language using easy to understand terms and 
        concepts, revise any regulations, forms, notices, guidance, and 
        publications relating to the full cost of repair or replacement 
        under the replacement cost coverage to more clearly describe 
        such coverage to flood insurance policyholders and information 
        to be provided by such policyholders relating to such coverage, 
        and to avoid providing misleading information to such 
        policyholders;
          (3) revise the language in standard flood insurance policies 
        under such program regarding rating and coverage descriptions 
        in a manner that is consistent with language used widely in 
        other homeowners and property and casualty insurance policies, 
        including such language regarding classification of buildings, 
        basements, crawl spaces, detached garages, enclosures below 
        elevated buildings, and replacement costs; and
          (4) require the use, in connection with flood insurance 
        policies, of the supplemental forms developed pursuant to 
        section 202 of the Bunning-Bereuter-Blumenauer Flood Insurance 
        Reform Act of 2004 (Public Law 108-264; 118 Stat. 725).

SEC. 25. AUTHORIZATION OF ADDITIONAL FEMA STAFF.

  Notwithstanding any other provision of law, the Director of the 
Federal Emergency Management Agency may employ such additional staff as 
may be necessary to carry out all of the responsibilities of the 
Director pursuant to this Act and the amendments made by this Act. 
There are authorized to be appropriated to Director such sums as may be 
necessary for costs of employing such additional staff.

SEC. 26. EXTENSION OF DEADLINE FOR FILING PROOF OF LOSS.

  (a) In General.--Section 1312 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4019) is amended--
          (1) by inserting ``(a) Payment.--'' before ``The Director''; 
        and
          (2) by adding at the end the following new subsection:
  ``(b) Filing Deadline for Proof of Loss.--
          ``(1) In general.--In establishing any requirements regarding 
        notification, proof, or approval of claims for damage to or 
        loss of property which is covered by flood insurance made 
        available under this title, the Director may not require an 
        insured to notify the Director of such damage or loss, submit a 
        claim for such damage or loss, or certify to or submit proof of 
        such damage or loss, before the expiration of the 180-day 
        period that begins on the date that such damage or loss 
        occurred.
          ``(2) Exceptions.--Notwithstanding any deadline established 
        in accordance with paragraph (1), the Director may not deny a 
        claim for damage or loss described in such paragraph solely for 
        failure to meet such deadline if the insured demonstrates any 
        good cause for such failure.''.
  (b) Applicability.--Subsection (b) of section 1312 of the National 
Flood Insurance Act of 1968, as added by subsection (a)(2) of this 
section, shall apply with respect to any claim under which the damage 
to or loss of property occurred on or after the date of the enactment 
of this Act.

SEC. 27. 5-YEAR EXTENSION OF PROGRAM.

  Section 1319 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4026) is amended by striking ``September 30, 2008'' and inserting 
``September 30, 2013''.

SEC. 28. REPORT ON INCLUSION OF BUILDING CODES IN FLOODPLAIN MANAGEMENT 
                    CRITERIA.

  Not later than the expiration of the 6-month period beginning on the 
date of the enactment of this Act, the Director of the Federal 
Emergency Management Agency shall conduct a study and submit a report 
to the Committee on Financial Services of the House of Representatives 
and the Committee on Banking, Housing and Urban Affairs of the Senate 
regarding the impact, effectiveness, and feasibility of amending 
section 1361 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4102) to include widely used and nationally recognized building codes 
as part of the floodplain management criteria developed under such 
section, and shall determine--
          (1) the regulatory, financial, and economic impacts of such a 
        building code requirement on homeowners, States and local 
        communities, local land use policies, and the Federal Emergency 
        Management Agency;
          (2) the resources required of State and local communities to 
        administer and enforce such a building code requirement;
          (3) the effectiveness of such a building code requirement in 
        reducing flood-related damage to buildings and contents;
          (4) the impact of such a building code requirement on the 
        actuarial soundness of the National Flood Insurance Program;
          (5) the effectiveness of nationally recognized codes in 
        allowing innovative materials and systems for flood-resistant 
        construction; and
          (6) the feasibility and effectiveness of providing an 
        incentive in lower premium rates for flood insurance coverage 
        under such Act for structures meeting whichever of such widely 
        used and nationally recognized building code or any applicable 
        local building code provides greater protection from flood 
        damage.

SEC. 29. STUDY OF ECONOMIC EFFECTS OF CHARGING ACTUARIALLY-BASED 
                    PREMIUM RATES FOR PRE-FIRM STRUCTURES.

  (a) Study.--The Director of the Federal Emergency Management Agency 
(in this section referred to as the ``Director'') shall conduct a study 
of the economic effects that would result from increasing premium rates 
for flood insurance coverage made available under the national flood 
insurance program for non-primary residences and non-residential pre-
FIRM structures (as such term is defined in section 578(b) of the 
National Flood Insurance Reform Act of 1994 (42 U.S.C. 4014 note) to 
the full actuarial risk based premium rate determined under section 
1307(a)(1) of the National Flood Insurance Act of 1968 for the area in 
which the property is located. In conducting the study, the Director 
shall--
          (1) determine each area that would be subject to such 
        increased premium rates; and
          (2) for each such area, determine--
                  (A) the amount by which premium rates would be 
                increased;
                  (B) the number and types of properties affected and 
                the number and types of properties covered by flood 
                insurance under this title likely to cancel such 
                insurance if the rate increases were made;
                  (C) the effects that the increased premium rates 
                would have on land values and property taxes; and
                  (D) any other effects that the increased premium 
                rates would have on the economy, homeowners, and 
                renters of non-primary residences.
  (b) Report.--The Director shall submit a report to the Congress 
describing and explaining the findings of the study conducted under 
this section. The report shall be submitted not later than 12 months 
after the date of the enactment of this Act.

                          Purpose and Summary

    H.R. 3121, the Flood Insurance Reform and Modernization Act 
of 2007, reauthorizes the National Flood Insurance Program 
(``NFIP''), provides for reforms to the NFIP, improves flood 
mapping, and expands the NFIP to provide for multiple peril 
coverage. The bill reauthorizes the NFIP for five years through 
2013 (the current authorization for the NFIP expires September 
30, 2008) and ensures its continued viability by encouraging 
broader participation, increasing financial accountability, 
eliminating unnecessary rate subsidies, and updating the flood 
insurance program to meet the needs of the 21st century.
    In an effort to make the NFIP more actuarially sound, the 
bill phases out subsidized rates on commercial properties, 
vacation homes, and second homes built before 1974. Multifamily 
rental properties are excluded from the phase-out of the 
subsidy.
    Additional optional policy coverage is added, allowing 
business owners to purchase business interruption coverage at 
actuarial rates to better prepare them to meet payroll and 
other obligations during the next big storm. Additionally, 
optional coverage at actuarial rates for basement improvements 
and replacement cost of contents is added. For the first time 
since 1994, the bill updates maximum insurance coverage limits 
for residential and nonresidential properties.
    The bill requires FEMA to conduct a thorough review of the 
nation's flood maps. The bill makes the updating and 
modernization of flood maps an ongoing process, and increases 
funding for mapping.
    Provisions protecting policy holders include clarification 
of disclosures about flood insurance availability and plain 
language information on flood insurance policies. Landlords 
must notify tenants of contents coverage availability. Further, 
the bill makes flood insurance effective immediately upon 
purchase of a home.
    To encourage participation in the NFIP, the bill provides 
for a new community outreach program, and provides for a study 
of how to increase participation by low-income families. In 
order to help ensure that those homeowners who should have 
flood insurance do have flood insurance, the bill increases the 
fines on lenders who do not enforce the mandatory flood 
insurance policy purchase requirement for those who live in a 
floodplain and hold a Federally-backed mortgage.
    Additionally, the bill requires FEMA to report to Congress 
annually on the financial status of the NFIP, increases the 
amount FEMA can raise policy rates in any given year from 10 
percent to 15 percent, and authorizes funding for additional 
staff at FEMA to carry out the requirements of this bill.

                  Background and Need for Legislation

    Congress created the NFIP in 1968, because flood insurance 
was generally not available to most homeowners through the 
private market. The NFIP is periodically reauthorized and was 
significantly revised in 1973, 1977, 1994, and 2004. The NFIP 
is administered through FEMA's Mitigation Directorate and is 
currently authorized through September 30, 2008.
    The NFIP generates premium revenue of approximately $2.4 
billion annually, which in an average flood event year covers 
all policy holder claims and operating expenses. The 2005 
hurricane seasonresulted in significant claims, which premium 
income could not cover. To cover the claims, the NFIP borrowed from the 
U.S. Treasury. Before 2005 the NFIP's borrowing authority was limited 
by statue to $1.5 billion. Congress amended the statutory limitation 
three times since September 2005, increasing the NFIP's borrowing 
authority from $1.5 billion to its current limit of $20.775 billion.
    The NFIP was designed to provide homeowners with affordable 
insurance protection against floods while alleviating 
taxpayers' responsibility for flood losses paid out in the form 
of post-disaster relief. The NFIP reduces future flood losses 
through: (i) flood hazard identification; (ii) floodplain 
management (i.e., land use controls and building requirements); 
and, (iii) insurance protection. The NFIP is estimated to 
reduce flood loss expenses to the Federal government by over $1 
billion annually.
    Ancillary to providing flood insurance under the NFIP, FEMA 
also: (i) identifies and maps flood prone areas eligible to 
participate in the program; and (ii) sets land use controls and 
building requirements that flood-prone communities are required 
to adopt and enforce in order to participate in the program and 
make flood insurance available to their residents.
    FEMA issues Flood Insurance Rate Maps (``FIRMs'') that 
delineate areas, called Special Flood Hazard Areas (``SFHAs''), 
determined to have a 1 percent chance of flooding in any given 
year (the ``100-year floodplain''). Because FIRMs determine 
where and at what rate insurance under the program is available 
or required, outdated or inaccurate FIRMs result in flood prone 
properties either being left out of the SFHAs, incorrectly 
being included in the SFHAs, or being charged incorrect rates. 
According to a June 2007 report issued by the Congressional 
Budget Office (CBO), the actuarial soundness of the NFIP 
depends on the accuracy of the flood maps. FEMA is currently 
engaged in a multi-year flood map modernization program to 
update, revise, and digitize over 100,000 paper maps.
    Under the NFIP, FEMA also sets land use controls and 
building requirements that communities located in SFHAs must 
adopt and enforce within SFHAs in order for property owners to 
be eligible for insurance under the program. Related to this 
land use control function, the NFIP includes a mitigation 
program through which grants are made to eligible entities to 
implement planning and projects that reduce future flood 
damage. Mitigation projects include such activities as 
purchasing flood-prone homes and returning the land to natural 
floodplain function, raising homes above the 100-year flood 
level, relocating homes out of SFHAs, demolishing and 
rebuilding compliant buildings, flood proofing nonresidential 
buildings and other activities that reduce flood damage.
    Insurance under the NFIP was initially optional and 
available for all properties located in SFHAs. Homeowners, 
renters, and business owners in participating communities 
purchase coverage under the program either directly from the 
NFIP or, most often, from private insurers that participate in 
the Write Your Own (``WYO'') program. WYO insurers take 
responsibility for policy administration and claims processing, 
but assume no financial risk in settling claims.
    In response to initially low participation in the NFIP, in 
1973 Congress made the purchase of flood insurance mandatory 
for all properties located in SFHAs with mortgages issued or 
guaranteed by the federal government. By 1994, lax enforcement 
of the mandatory purchase requirements led Congress to require 
lenders to purchase coverage on behalf of and bill premiums to 
mortgagees who failed to purchase coverage on their own (called 
``forced placed insurance''). Since 1994, lenders who fail to 
enforce the mandatory purchase requirement are subject to civil 
penalties.
    The NFIP has a two-tiered rate structure: (1) a subsidized 
pre-FIRM rate for structures built before the 1974 mandatory 
purchase requirement went into effect for all FIRM properties; 
and, (2) an ``actuarial'' rate for structures built or 
substantially improved after 1974. Pre-FIRM rates are 
determined through a federal rule-making process with criteria 
designed to encourage participation in the program and not, by 
definition, to generate premium income sufficient to pay 
anticipated claims on pre-FIRM properties.
    Congress expected that, over time, the percentage of pre-
FIRM structures would decline and that most or all of the 
structures insured under the program would be subject to 
``actuarial'' rates. However, pre-FIRM structures continue to 
represent approximately 24 percent of structures insured under 
the NFIP. The NFIP uses its borrowing authority and its 
``actuarial'' rate premiums to cover any shortfalls that result 
from the program's two tier rate structure.
    The program's ``actuarial'' rates are also designed, in 
part, to encourage participation in the program. As a result, 
these ``actuarial'' rates do not follow traditional rate-making 
methods designed to generate premium income sufficient to pay 
reasonably anticipated claims. Instead, rates under the program 
are only designed to generate annual premium income equal to 
the average annual claims paid by under the program since 1978. 
In ``bad'' years, when actual annual claims exceed the 
program's average annual claims, the NFIP has used its 
borrowing authority to make-up the shortfall. In ``good'' 
years, when average annual claims exceeded actual annual 
claims, the NFIP has either used surplus premiums to repay 
(with interest) funds borrowed in ``bad'' years or has saved 
surplus premiums to cover claims in future ``bad'' years.
    With its borrowing authority capped at $1.5 billion, the 
program had enough surplus premium income from ``good'' years 
to repay the Treasury within a reasonable period of time and 
avoiding significant interest expenses. The massive borrowing 
necessary to pay claims from the 2005 hurricane season upset 
the program's balance leaving the program with a current debt 
of approximately $17.5 billion. The NFIP pays interest on the 
outstanding debt of between $600 million to $800 million 
annually.

                                Hearings

    The Subcommittee on Housing and Community Opportunity held 
a hearing entitled ``The Flood Insurance Reform and 
Modernization Act of 2007, H.R. 1682'' on June 12, 2007. The 
following witnesses testified:

                               PANEL ONE

           Mr. Edward L. Connor, Deputy Assistant 
        Administrator for Insurance, Federal Emergency 
        Management Agency

                               PANEL TWO

           Mr. Paul A. Osman, CFM, Illinois Department 
        of Natural Resources, on behalf of Association of State 
        Floodplains Managers, Inc.
           Mr. David Maune, Ph.D., CP, CFM, on behalf 
        of Management Association for Private Photogrammetric 
        Surveyors
           Mr. Curt Sumner, Executive Director, 
        American Congress on Surveying and Mapping
           Mr. Mark Davey, President & CEO, Fidelity 
        National Insurance Company, on behalf of Property 
        Casualty Insurers Association of America
           Mr. Thomas Minkler, President of the Clark-
        Mortenson Agency, Inc., on behalf of Independent 
        Insurance Agents & Brokers of America, Inc.
           Mr. Vince Malta, President, Malta & Co., 
        Inc., on behalf of the National Association of Realtors
    The Subcommittee on Housing and Community Opportunity held 
a hearing entitled ``H.R. 920, the Multiple Peril Insurance Act 
of 2007'' on July 17, 2007. The following witnesses testified:

                               PANEL ONE

           The Honorable Richard H. Baker
           The Honorable Gene Taylor
           The Honorable Charlie Melancon
           The Honorable Bobby Jindal

                               PANEL TWO

           Mr. David I. Maurstad, Assistant 
        Administrator for Mitigation, Federal Emergency 
        Management Agency
           The Honorable Phillip Swagel, Assistant 
        Secretary for Economic Policy, U.S. Department of the 
        Treasury

                              PANEL THREE

           Ms. Pam Pogue, Vice Chair, Association of 
        State Floodplain Managers
           Ms. Sandy Praeger, Commissioner, Kansas 
        Insurance Department, on behalf of the National 
        Association of Insurance Commissioners
           Mr. Ted A. Majewski, Senior Vice President, 
        Harleysville Insurance, on behalf of the Property 
        Casualty Insurers, American Insurance Association, and 
        National Association of Mutual Insurance Companies
           Ms. Cheryl Small, Policy Advisor, National 
        Flood Determination Association
           Mr. W. Anderson Baker, III, CPCU, ARM, 
        Gillis, Ellis & Baker Inc.
           Dr. Robert P. Hartwig, Ph.D., CPCU, 
        President and Chief Economist, Insurance Information 
        Institute
           Mr. David Conrad, Senior Water Resources 
        Specialist, National Wildlife Federation

                        Committee Consideration

    The Committee on Financial Services met in open session on 
July 26, 2007, and ordered reported H.R. 3121, the Flood 
Insurance Reform and Modernization Act of 2007, as amended, to 
the House with a favorable recommendation by a record vote of 
38 yeas and 29 nays.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. A 
motion by Mr. Frank to report the bill, as amended, to the 
House with a favorable recommendation was agreed to by a record 
vote of 38 yeas and 29 nays (Record vote no. FC-56). The names 
of Members voting for and against follow:

                                              RECORD VOTE NO. FC-56
----------------------------------------------------------------------------------------------------------------
         Representative             Aye       Nay     Present     Representative      Aye       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Frank......................        X   ........  .........  Mr. Bachus.......  ........        X   .........
Mr. Kanjorski..................        X   ........  .........  Mr. Baker........  ........  ........  .........
Ms. Waters.....................        X   ........  .........  Ms. Pryce (OH)...  ........        X   .........
Mrs. Maloney...................        X   ........  .........  Mr. Castle.......  ........        X   .........
Mr. Gutierrez..................        X   ........  .........  Mr. King (NY)....  ........        X   .........
Ms. Velazquez..................        X   ........  .........  Mr. Royce........  ........        X   .........
Mr. Watt.......................        X   ........  .........  Mr. Lucas........  ........        X   .........
Mr. Ackerman...................        X   ........  .........  Mr. Paul.........  ........        X   .........
Ms. Carson.....................        X   ........  .........  Mr. Gillmor......  ........        X   .........
Mr. Sherman....................        X   ........  .........  Mr. LaTourette...        X   ........  .........
Mr. Meeks......................        X   ........  .........  Mr. Manzullo.....  ........  ........  .........
Mr. Moore (KS).................        X   ........  .........  Mr. Jones........        X   ........  .........
Mr. Capuano....................        X   ........  .........  Mrs. Biggert.....  ........        X   .........
Mr. Hinojosa...................  ........  ........  .........  Mr. Shays........  ........        X   .........
Mr. Clay.......................        X   ........  .........  Mr. Miller (CA)..  ........        X   .........
Mrs. McCarthy..................        X   ........  .........  Mrs. Capito......  ........        X   .........
Mr. Baca.......................        X   ........  .........  Mr. Feeney.......  ........        X   .........
Mr. Lynch......................        X   ........  .........  Mr. Hensarling...  ........        X   .........
Mr. Miller (NC)................        X   ........  .........  Mr. Garrett (NJ).  ........        X   .........
Mr. Scott......................        X   ........  .........  Ms. Brown-Waite..  ........        X   .........
Mr. Green......................        X   ........  .........  Mr. Barrett (SC).  ........        X   .........
Mr. Cleaver....................        X   ........  .........  Mr. Gerlach......  ........        X   .........
Ms. Bean.......................        X   ........  .........  Mr. Pearce.......  ........        X   .........
Ms. Moore (WI).................        X   ........  .........  Mr. Neugebauer...  ........        X   .........
Mr. Davis (TN).................        X   ........  .........  Mr. Price (GA)...  ........        X   .........
Mr. Sires......................        X   ........  .........  Mr. Davis (KY)...  ........        X   .........
Mr. Hodes......................        X   ........  .........  Mr. McHenry......  ........        X   .........
Mr. Ellison....................        X   ........  .........  Mr. Campbell.....  ........        X   .........
Mr. Klein......................        X   ........  .........  Mr. Putnam.......  ........        X   .........
Mr. Mahoney (FL)...............        X   ........  .........  Mrs. Bachmann....  ........        X   .........
Mr. Wilson.....................        X   ........  .........  Mr. Roskam.......  ........        X   .........
Mr. Perlmutter.................        X   ........  .........  Mr. Marchant.....  ........        X   .........
Mr. Murphy.....................        X   ........  .........  Mr. McCotter.....  ........        X   .........
Mr. Donnelly...................        X   ........  .........
Mr. Wexler.....................        X   ........  .........
Mr. Marshall...................        X   ........  .........
Mr. Boren......................        X   ........  .........
----------------------------------------------------------------------------------------------------------------

    The following amendments were disposed of by record votes. 
The names of Members voting for and against follow:
    An amendment by Mrs. Biggert, No. 1, an amendment in the 
nature of a substitute striking all after the enacting clause 
and inserting H.R. 1682, was not agreed to by a record vote of 
30 yeas and 37 nays (Record vote no. FC-52):

                                                                  RECORD VOTE NO. FC-52
--------------------------------------------------------------------------------------------------------------------------------------------------------
                 Representative                      Aye       Nay        Present                Representative               Aye       Nay     Present
--------------------------------------------------------------------------------------------------------------------------------------------------------
Mr. Frank.......................................  ........        X   ...............  Mr. Bachus........................        X   ........  .........
Mr. Kanjorski...................................  ........        X   ...............  Mr. Baker.........................        X   ........  .........
Ms. Waters......................................  ........        X   ...............  Ms. Pryce (OH)....................        X   ........  .........
Mrs. Maloney....................................  ........        X   ...............  Mr. Castle........................        X   ........  .........
Mr. Gutierrez...................................  ........        X   ...............  Mr. King (NY).....................        X   ........  .........
Ms. Velazquez...................................  ........        X   ...............  Mr. Royce.........................        X   ........  .........
Mr. Watt........................................  ........        X   ...............  Mr. Lucas.........................        X   ........  .........
Mr. Ackerman....................................  ........        X   ...............  Mr. Paul..........................        X   ........  .........
Ms. Carson......................................  ........        X   ...............  Mr. Gillmor.......................        X   ........  .........
Mr. Sherman.....................................  ........        X   ...............  Mr. LaTourette....................        X   ........  .........
Mr. Meeks.......................................  ........        X   ...............  Mr. Manzullo......................  ........  ........  .........
Mr. Moore (KS)..................................  ........        X   ...............  Mr. Jones.........................  ........        X   .........
Mr. Capuano.....................................  ........        X   ...............  Mrs. Biggert......................        X   ........  .........
Mr. Hinojosa....................................  ........  ........  ...............  Mr. Shays.........................        X   ........  .........
Mr. Clay........................................  ........        X   ...............  Mr. Miller (CA)...................        X   ........  .........
Mrs. McCarthy...................................  ........        X   ...............  Mrs. Capito.......................        X   ........  .........
Mr. Baca........................................  ........        X   ...............  Mr. Feeney........................        X   ........  .........
Mr. Lynch.......................................  ........        X   ...............  Mr. Hensarling....................        X   ........  .........
Mr. Miller (NC).................................  ........        X   ...............  Mr. Garrett (NJ)..................        X   ........  .........
Mr. Scott.......................................  ........        X   ...............  Ms. Brown-Waite...................        X   ........  .........
Mr. Green.......................................  ........        X   ...............  Mr. Barrett (SC)..................        X   ........  .........
Mr. Cleaver.....................................  ........        X   ...............  Mr. Gerlach.......................        X   ........  .........
Ms. Bean........................................  ........        X   ...............  Mr. Pearce........................        X   ........  .........
Ms. Moore (WI)..................................  ........        X   ...............  Mr. Neugebauer....................        X   ........  .........
Mr. Davis (TN)..................................  ........        X   ...............  Mr. Price (GA)....................        X   ........  .........
Mr. Sires.......................................  ........        X   ...............  Mr. Davis (KY)....................        X   ........  .........
Mr. Hodes.......................................  ........        X   ...............  Mr. McHenry.......................        X   ........  .........
Mr. Ellison.....................................  ........        X   ...............  Mr. Campbell......................        X   ........  .........
Mr. Klein.......................................  ........        X   ...............  Mr. Putnam........................        X   ........  .........
Mr. Mahoney (FL)................................  ........        X   ...............  Mrs. Bachmann.....................        X   ........  .........
Mr. Wilson......................................  ........        X   ...............  Mr. Roskam........................        X   ........  .........
Mr. Perlmutter..................................  ........        X   ...............  Mr. Marchant......................  ........  ........  .........
Mr. Murphy......................................  ........        X   ...............  Mr. McCotter......................        X   ........  .........
Mr. Donnelly....................................  ........        X   ...............
Mr. Wexler......................................  ........        X   ...............
Mr. Marshall....................................  ........        X   ...............
Mr. Boren.......................................  ........        X   ...............
--------------------------------------------------------------------------------------------------------------------------------------------------------

    An amendment by Ms. Brown-Waite, No. 12, striking Section 7 
(multi-peril coverage) and inserting a study regarding 
expansion of the national flood insurance program, was not 
agreed to by a record vote of 31 yeas and 37 nays (Record vote 
no. FC-53):

                                              RECORD VOTE NO. FC-53
----------------------------------------------------------------------------------------------------------------
         Representative             Aye       Nay     Present     Representative      Aye       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Frank......................  ........        X   .........  Mr. Bachus.......        X   ........  .........
Mr. Kanjorski..................  ........        X   .........  Mr. Baker........        X   ........  .........
Ms. Waters.....................  ........        X   .........  Ms. Pryce (OH)...        X   ........  .........
Mrs. Maloney...................  ........        X   .........  Mr. Castle.......        X   ........  .........
Mr. Gutierrez..................  ........        X   .........  Mr. King (NY)....        X   ........  .........
Ms. Velazquez..................  ........        X   .........  Mr. Royce........        X   ........  .........
Mr. Watt.......................  ........        X   .........  Mr. Lucas........        X   ........  .........
Mr. Ackerman...................  ........        X   .........  Mr. Paul.........        X   ........  .........
Ms. Carson.....................  ........        X   .........  Mr. Gillmor......        X   ........  .........
Mr. Sherman....................  ........        X   .........  Mr. LaTourette...        X   ........  .........
Mr. Meeks......................  ........        X   .........  Mr. Manzullo.....  ........  ........  .........
Mr. Moore (KS).................  ........        X   .........  Mr. Jones........  ........        X   .........
Mr. Capuano....................  ........        X   .........  Mrs. Biggert.....        X   ........  .........
Mr. Hinojosa...................  ........  ........  .........  Mr. Shays........        X   ........  .........
Mr. Clay.......................  ........        X   .........  Mr. Miller (CA)..        X   ........  .........
Mrs. McCarthy..................  ........        X   .........  Mrs. Capito......        X   ........  .........
Mr. Baca.......................  ........        X   .........  Mr. Feeney.......        X   ........  .........
Mr. Lynch......................  ........        X   .........  Mr. Hensarling...        X   ........  .........
Mr. Miller (NC)................  ........        X   .........  Mr. Garrett (NJ).        X   ........  .........
Mr. Scott......................  ........        X   .........  Ms. Brown-Waite..        X   ........  .........
Mr. Green......................  ........        X   .........  Mr. Barrett (SC).        X   ........  .........
Mr. Cleaver....................  ........        X   .........  Mr. Gerlach......        X   ........  .........
Ms. Bean.......................  ........        X   .........  Mr. Pearce.......        X   ........  .........
Ms. Moore (WI).................  ........        X   .........  Mr. Neugebauer...        X   ........  .........
Mr. Davis (TN).................  ........        X   .........  Mr. Price (GA)...        X   ........  .........
Mr. Sires......................  ........        X   .........  Mr. Davis (KY)...        X   ........  .........
Mr. Hodes......................  ........        X   .........  Mr. McHenry......        X   ........  .........
Mr. Ellison....................  ........        X   .........  Mr. Campbell.....        X   ........  .........
Mr. Klein......................  ........        X   .........  Mr. Putnam.......        X   ........  .........
Mr. Mahoney (FL)...............  ........        X   .........  Mrs. Bachmann....        X   ........  .........
Mr. Wilson.....................  ........        X   .........  Mr. Roskam.......        X   ........  .........
Mr. Perlmutter.................  ........        X   .........  Mr. Marchant.....        X   ........  .........
Mr. Murphy.....................  ........        X   .........  Mr. McCotter.....        X   ........  .........
Mr. Donnelly...................  ........        X   .........
Mr. Wexler.....................  ........        X   .........
Mr. Marshall...................  ........        X   .........
Mr. Boren......................  ........        X   .........
----------------------------------------------------------------------------------------------------------------

    An amendment by Mr. Davis of Kentucky, No. 14, regarding 
conditions for making coverage available, was not agreed to by 
a record vote of 30 yeas and 37 nays (Record vote no. FC-54):

                                              RECORD VOTE NO. FC-54
----------------------------------------------------------------------------------------------------------------
         Representative             Aye       Nay     Present     Representative      Aye       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Frank......................  ........        X   .........  Mr. Bachus.......        X   ........  .........
Mr. Kanjorski..................  ........        X   .........  Mr. Baker........  ........  ........  .........
Ms. Waters.....................  ........        X   .........  Ms. Pryce (OH)...        X   ........  .........
Mrs. Maloney...................  ........        X   .........  Mr. Castle.......        X   ........  .........
Mr. Gutierrez..................  ........        X   .........  Mr. King (NY)....        X   ........  .........
Ms. Velazquez..................  ........        X   .........  Mr. Royce........        X   ........  .........
Mr. Watt.......................  ........        X   .........  Mr. Lucas........        X   ........  .........
Mr. Ackerman...................  ........        X   .........  Mr. Paul.........        X   ........  .........
Ms. Carson.....................  ........        X   .........  Mr. Gillmor......        X   ........  .........
Mr. Sherman....................  ........        X   .........  Mr. LaTourette...        X   ........  .........
Mr. Meeks......................  ........        X   .........  Mr. Manzullo.....  ........  ........  .........
Mr. Moore (KS).................  ........        X   .........  Mr. Jones........  ........        X   .........
Mr. Capuano....................  ........        X   .........  Mrs. Biggert.....        X   ........  .........
Mr. Hinojosa...................  ........  ........  .........  Mr. Shays........        X   ........  .........
Mr. Clay.......................  ........        X   .........  Mr. Miller (CA)..        X   ........  .........
Mrs. McCarthy..................  ........        X   .........  Mrs. Capito......        X   ........  .........
Mr. Baca.......................  ........        X   .........  Mr. Feeney.......        X   ........  .........
Mr. Lynch......................  ........        X   .........  Mr. Hensarling...        X   ........  .........
Mr. Miller (NC)................  ........        X   .........  Mr. Garrett (NJ).        X   ........  .........
Mr. Scott......................  ........        X   .........  Ms. Brown-Waite..        X   ........  .........
Mr. Green......................  ........        X   .........  Mr. Barrett (SC).        X   ........  .........
Mr. Cleaver....................  ........        X   .........  Mr. Gerlach......        X   ........  .........
Ms. Bean.......................  ........        X   .........  Mr. Pearce.......        X   ........  .........
Ms. Moore (WI).................  ........        X   .........  Mr. Neugebauer...        X   ........  .........
Mr. Davis (TN).................  ........        X   .........  Mr. Price (GA)...        X   ........  .........
Mr. Sires......................  ........        X   .........  Mr. Davis (KY)...        X   ........  .........
Mr. Hodes......................  ........        X   .........  Mr. McHenry......        X   ........  .........
Mr. Ellison....................  ........        X   .........  Mr. Campbell.....        X   ........  .........
Mr. Klein......................  ........        X   .........  Mr. Putnam.......        X   ........  .........
Mr. Mahoney (FL)...............  ........        X   .........  Mrs. Bachmann....        X   ........  .........
Mr. Wilson.....................  ........        X   .........  Mr. Roskam.......        X   ........  .........
Mr. Perlmutter.................  ........        X   .........  Mr. Marchant.....        X   ........  .........
Mr. Murphy.....................  ........        X   .........  Mr. McCotter.....        X
Mr. Donnelly...................  ........        X   .........
Mr. Wexler.....................  ........        X   .........
Mr. Marshall...................  ........        X   .........
Mr. Boren......................  ........        X   .........
----------------------------------------------------------------------------------------------------------------

    An amendment by Mr. Price of Georgia, No. 17, striking 
Section 26 (extension of deadline for filing proof of loss), 
was not agreed to by a record vote of 24 yeas and 43 nays 
(Record vote no. FC-55):

                                              RECORD VOTE NO. FC-55
----------------------------------------------------------------------------------------------------------------
         Representative             Aye       Nay     Present     Representative      Aye       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Frank......................  ........        X   .........  Mr. Bachus.......        X   ........  .........
Mr. Kanjorski..................  ........        X   .........  Mr. Baker........  ........  ........  .........
Ms. Waters.....................  ........        X   .........  Ms. Pryce (OH)...  ........        X   .........
Mrs. Maloney...................  ........        X   .........  Mr. Castle.......  ........        X   .........
Mr. Gutierrez..................  ........        X   .........  Mr. King (NY)....  ........        X   .........
Ms. Velazquez..................  ........        X   .........  Mr. Royce........        X   ........  .........
Mr. Watt.......................  ........        X   .........  Mr. Lucas........        X   ........  .........
Mr. Ackerman...................  ........        X   .........  Mr. Paul.........        X   ........  .........
Ms. Carson.....................  ........        X   .........  Mr. Gillmor......        X   ........  .........
Mr. Sherman....................  ........        X   .........  Mr. LaTourette...  ........        X   .........
Mr. Meeks......................  ........        X   .........  Mr. Manzullo.....  ........  ........  .........
Mr. Moore (KS).................  ........        X   .........  Mr. Jones........  ........        X   .........
Mr. Capuano....................  ........        X   .........  Mrs. Biggert.....        X   ........  .........
Mr. Hinojosa...................  ........  ........  .........  Mr. Shays........        X   ........  .........
Mr. Clay.......................  ........        X   .........  Mr. Miller (CA)..        X   ........  .........
Mrs. McCarthy..................  ........        X   .........  Mrs. Capito......        X   ........  .........
Mr. Baca.......................  ........        X   .........  Mr. Feeney.......        X   ........  .........
Mr. Lynch......................  ........        X   .........  Mr. Hensarling...        X   ........  .........
Mr. Miller (NC)................  ........        X   .........  Mr. Garrett (NJ).        X   ........  .........
Mr. Scott......................  ........        X   .........  Ms. Brown-Waite).        X   ........  .........
Mr. Green......................  ........        X   .........  Mr. Barrett (SC).        X   ........  .........
Mr. Cleaver....................  ........        X   .........  Mr. Gerlach......  ........        X   .........
Ms. Bean.......................  ........        X   .........  Mr. Pearce.......        X   ........  .........
Ms. Moore (WI).................  ........        X   .........  Mr. Neugebauer...        X   ........  .........
Mr. Davis (TN).................  ........        X   .........  Mr. Price (GA)...        X   ........  .........
Mr. Sires......................  ........        X   .........  Mr. Davis (KY)...        X   ........  .........
Mr. Hodes......................  ........        X   .........  Mr. McHenry......        X   ........  .........
Mr. Ellison....................  ........        X   .........  Mr. Campbell.....        X   ........  .........
Mr. Klein......................  ........        X   .........  Mr. Putnam.......        X   ........  .........
Mr. Mahoney (FL)...............  ........        X   .........  Mrs. Bachmann....        X   ........  .........
Mr. Wilson.....................  ........        X   .........  Mr. Roskam.......        X   ........  .........
Mr. Perlmutter.................  ........        X   .........  Mr. Marchant.....  ........        X   .........
Mr. Murphy.....................  ........        X   .........  Mr. McCotter.....        X   ........  .........
Mr. Donnelly...................  ........        X   .........
Mr. Wexler.....................  ........        X   .........
Mr. Marshall...................  ........        X   .........
Mr. Boren......................  ........        X   .........
----------------------------------------------------------------------------------------------------------------

    The following other amendments were also considered by the 
Committee:
    An amendment by Mr. Neugebauer, No. 2, directing FEMA to 
conduct a study and report to Congress on inclusion of building 
codes in floodplain management criteria, was agreed to by a 
voice vote.
    An amendment by Mr. Hinojosa, No. 3, regarding effective 
date of ongoing flood mapping program, was agreed to by a voice 
vote.
    An amendment by Mr. Klein, No. 4, striking Section 4 
(phase-in of actuarial rates for nonresidential properties and 
non-primary residences) and inserting study on increasing 
premiums for nonresidential properties and non-primary 
residences, was withdrawn.
    An en bloc amendment by Mr. Hinojosa, No. 5, requiring a 
study of economic effects of charging actuarially-based premium 
rates for pre-firm structures; effecting a change in membership 
of technical mapping advisory council for ongoing mapping 
program; and include residential property, including 
multifamily rental property, for losses, was agreed to by a 
voice vote.
    An amendment by Mr. Hinojosa (and Mr. Green), No. 6, 
ensuring that rental property used as primary residence is 
covered, was agreed to by a voice vote.
    An amendment by Mr. Hinojosa, No. 7, updating information 
of mapping upon request of community, was agreed to by a voice 
vote.
    An amendment by Mr. Green (and Mr. Cleaver), No. 8, 
providing for tenant notice of availability of contest 
insurance, was agreed to by a voice vote.
    An amendment by Mr. Cleaver, No. 9, preventing delay of 
100-year maps, was agreed to by a voice vote.
    An amendment by Mr. Garrett, No. 10, on pre-firm phase-in 
properties, was agreed to by a voice vote.
    An amendment by Mr. Boren, No. 11, regarding a report on 
current efforts by FEMA to market and educate consumers 
regarding benefits of obtaining coverage under the national 
flood insurance program, was agreed to by a voice vote.
    An amendment by Mr. Baker, No. 13, establishing an 
effective date for Section 7 (multi-peril coverage), was agreed 
to by a voice vote.
    An amendment by Mr. Hensarling, No. 15, modifying the FEMA 
report on borrowing authority, was agreed to by a voice vote.
    An amendment by Mr. Price of Georgia, No. 16, requiring use 
of supplemental forms in connection with flood insurance 
policies, was agreed to by a voice vote.
    An amendment by Mr. McHenry, No. 18, concerning a 
requirement to cease offering coverage if borrowing to pay 
claims, was agreed to by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee has held hearings and 
made findings that are reflected in this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee establishes the 
following performance related goals and objectives for this 
legislation:
    H.R. 3121, the Flood Insurance Reform and Modernization Act 
of 2007, reauthorizes the National Flood Insurance Program and 
provides for reforms and changes to the program with the goal 
of strengthening the program and ensuring its long-term 
viability.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                  Congressional Budget Office Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                                September 20, 2007.
Hon. Barney Frank,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3121, the Flood 
Insurance Reform and Modernization Act of 2007.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Daniel 
Hoople.
            Sincerely,
                                                   Peter R. Orszag.
    Enclosure.

H.R. 3121--Flood Insurance Reform and Modernization Act of 2007

    Summary: H.R. 3121 would authorize the National Flood 
Insurance Program (NFIP) of the Federal Emergency Management 
Agency (FEMA) to enter into and renew flood insurance policies 
through 2013. Under current law, that authority would expire at 
the end of 2008. The legislation also would increase the amount 
that FEMA can borrow from the U.S. Treasury to cover expenses 
of the NFIP from $20.8 billion to $21.5 billion. As a result, 
CBO estimates that enacting H.R. 3121 would increase direct 
spending by $725 million in 2009.
    By raising certain civil penalties on lending institutions, 
CBO estimates that the bill would increase revenues by $1 
million per year. Finally, H.R. 3121 would authorize the 
appropriation of nearly $2.8 billion over the 2008-2012 period 
for mapping regions of the country at risk of flooding and for 
other activities. CBO estimates that implementing those 
provisions would increase discretionary spending by about $1.8 
billion over the 2008-2012 period, assuming the appropriation 
of the specified amounts.
    H.R. 3121 would require FEMA to phase in actuarially sound 
flood insurance premiums for owners of certain commercial 
properties and some residential properties that are not the 
owners' primary residences--if they do not currently pay 
actuarial rates for flood insurance. The legislation also would 
authorize FEMA to offer new types of insurance coverage 
(including multiperil insurance for floods and windstorms) as 
well as increase the maximum insurance coverage available for 
structures and their contents. Moreover, H.R. 3121 would raise 
the cap on the average annual premium increase allowed under 
current law from 10 percent to 15 percent. CBO estimates that 
enacting those provisions would have no significant net effect 
on direct spending over the 2008-2017 period. (The increases in 
premiums would yield an additional $3.1 billion in receipts 
over that period, but they would have to be spent to cover the 
NFIP's ongoing costs.)
    H.R. 3121 contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on state, local, or tribal governments. H.R. 3121 would 
impose a private-sector mandate, as defined in UMRA, on certain 
mortgagelenders. Based on information from FEMA and industry 
sources, CBO expects the direct costs to comply with the mandate would 
be small and fall below the annual threshold for private-sector 
mandates established in UMRA ($131 million in 2007, adjusted annually 
for inflation).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 3121 is shown in the following table. 
The costs of this legislation fall within budget function 450 
(community and regional development).

------------------------------------------------------------------------
                                      By fiscal year, in millions of
                                                 dollars--
                                 ---------------------------------------
                                   2008    2009    2010    2011    2012
------------------------------------------------------------------------
               CHANGES IN DIRECT SPENDING AND REVENUES\1\

Additional Borrowing for Flood
 Insurance:
    Estimated Budget Authority..       0     725       0       0       0
    Estimated Outlays...........       0     725       0       0       0
Estimated Revenues..............       1       1       1       1       1

              CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Flood Mapping Program:
    Authorization Level.........     400     400     400     400     400
    Estimated Outlays...........     100     260     340     400     400
Outreach Grants:
    Authorization Level.........      50      50      50      50      50
    Estimated Outlays...........      28      40      50      50      50
Mitigation of Severe Repetitive
 Loss Properties:
    Authorization Level.........       0       0      40      40      40
    Estimated Outlays...........       0       0      12      36      40
Additional Studies:
    Authorization Level.........       1       0       0       0       0
    Estimated Outlays...........       1       0       0       0       0
Total Changes:
    Authorization Level.........     451     450     490     490     490
    Estimated Outlays...........     129     300     402     486     490
------------------------------------------------------------------------
\1\CBO estimates that there would be no changes in direct spending after
  2012 under H.R. 3121, and that revenue collections of $1 million a
  year would continue after 2012.

    Basis of estimate: For this estimate, CBO assumes that H.R. 
3121 will be enacted near the start of fiscal year 2008 and 
that amounts specified by the bill will be appropriated for 
each year. We estimate that enacting H.R. 3121 would increase 
direct spending by $725 million in 2009. In addition, CBO 
estimates that implementing the bill would increase 
discretionary spending by about $1.8 billion over the 2008-2012 
period.

Direct spending and revenues

    CBO estimates that the bill's increase in FEMA's borrowing 
authority would result in new direct spending. Other changes to 
the flood insurance program would affect operations of the 
program, but we estimate that those changes would not result in 
any significant net impact on direct spending over the next 10 
years.
    Increase in borrowing authority. Through the NFIP, FEMA 
offers flood insurance in communities that conform to the 
program's standards for flood plain management. Under current 
law, if premiums from policy sales and interest income are 
insufficient to cover the program's costs, FEMA can borrow up 
to $20.8 billion from the U.S. Treasury. As of August 2007, the 
NFIP had borrowed a total of $17.5 billion (the bulk of which 
has been used to settle claims related to Hurricanes Katrina 
and Rita). Based on information from FEMA about outstanding 
claims and continuing interest payments on its past borrowing, 
CBO expects that the agency will exhaust its remaining 
borrowing authority within the next few years. Section 12 would 
increase FEMA's borrowing authority for the flood insurance 
program by $725 million. CBO estimates that the agency would 
exercise this authority in 2009, resulting in an increase in 
direct spending of $725 million in that year, relative to 
current baseline projections.
    Current law requires FEMA to repay any borrowed funds (with 
interest) as it collects premiums, provided that the program's 
other costs are fully covered. However, CBO expects that the 
agency would be unlikely to repay funds borrowed under H.R. 
3121 within the next 10 years. Based on historical data, the 
agency is likely to face claims of between $1 billion and $2 
billion per year for flooding events around the country (this 
does not include additional claims that would be filed if 
another catastrophic event were to occur). Based on the amount 
of current and projected borrowing by the flood insurance 
program, CBO estimates that FEMA also will be required to make 
annual debt-service payments to the Treasury of between $800 
million and $900 million. CBO expects that the program will 
collect insufficient premiums to cover claims expenses and 
debt-service costs over the next 10 years. In other words, CBO 
expects that the NFIP will probably not have sufficient funds 
to make timely payments for all valid claims submitted to it. 
By increasing the program's borrowing authority, H.R. 3121 
would provide resources--$725 million--to liquidate such claims 
that otherwise could not be promptly paid under current law.
    Civil penalties. Section 6 would increase the civil penalty 
from $350 to $2,000 for lenders that do not enforce the 
purchase and notification requirements for certain mortgagors. 
Penalty collections are recorded in the budget as revenues. CBO 
estimates that the increased collections of civil penalties 
under this bill would total about $1 million a year. The 
amounts collected would be credited to the National Flood 
Mitigation Fund and could be spent, subject to future 
appropriation actions.
    Rate increases for certain properties. Section 4 would 
direct FEMA to increase flood insurance premiums for certain 
policyholders who currently receive discounted or subsidized 
rates. Under current law, some property owners are charged a 
premium that is less than the full actuarial cost of the 
insurance because they were built before the community's flood 
insurance rate map (FIRM) was completed (or before 1975, 
whichever is later). Those properties are collectively known as 
pre-FIRM properties. (Some post-FIRM policies also receive a 
discounted premium, but they are few in number relative to pre-
FIRM properties.) FEMA estimates the average discount for pre-
FIRM properties is about 60 percent.
    H.R. 3121 would increase premiums for nonresidential pre-
FIRM properties and pre-FIRM properties that are not the 
primary residence of either the owner or a tenant (for example, 
vacation homes) to actuarial levels by 2011. The bill would 
direct the NFIP to assess an additional 15 percent on top of 
routine annual rate increases for those properties until the 
actuarial rate is achieved (or until 2011, when such policies 
would be charged an actuarial rate). Based on information from 
FEMA, CBO estimates that approximately 375,000 properties would 
be subject to such rate increases under the bill. CBO expects 
that owners of some of those properties would either drop flood 
insurance or reduce their level of coverage in response to an 
increase in premium charges. However, we expect that any 
decrease in premium income resulting from a reduction in 
coverage would be more than offset by increased collections 
from properties that remain in the program. Additionally, by 
reducing the number of pre-FIRM properties in the program, the 
NFIP would save the cost of paying claims on those subsidized 
policies in the future.
    CBO estimates that implementing this provision would 
increase receipts from flood insurance premiums by about $900 
million over the 2008-2012 period and by about$3.1 billion over 
the next 10 years. Subsidized policyholders that drop flood insurance 
coverage in response to the rate increases would reduce program costs 
by an average of $45 million a year over the next 10 years, CBO 
estimates.
    CBO anticipates that any additional receipts generated by 
increasing premiums on those properties would be spent on 
future flood insurance claims that the program would otherwise 
not have the resources to pay--resulting in no significant net 
budgetary impact. That is, the program changes required under 
section 4 would improve the long-term actuarial position of the 
NFIP; but the program's large debt and the requirement to pay 
interest costs on that debt means that savings from the 
reduction in subsidized policies would have to be used to cover 
ongoing costs of the NFIP and would not lead to net budgetary 
savings over the 2008-2017 period.
    Multiperil insurance. Section 7 would authorize FEMA to 
offer insurance coverage for flood and wind damage to property 
owners in communities that conform to the program's standards 
for wind damage and flood plain management. (Additional 
standards related to windstorms would be established under the 
bill based on studies undertaken by FEMA.) Under H.R. 3121, 
FEMA would be authorized to insure damages attributable to 
floods or windstorms up to a maximum of $650,000 per residence 
for structure, contents, and additional living expenses and a 
total of $1,750,000 for structure, contents, and business 
interruption losses for commercial properties.
    H.R. 3121 would direct FEMA to offer such multiperil 
coverage at actuarial (i.e., unsubsidized) rates. Because of 
the uncertain nature of actuarial pricing, FEMA might collect 
more receipts than necessary to pay future claims (resulting in 
a net reduction in direct spending). It is also possible that 
FEMA might collect less premium income than would be necessary 
to cover future liabilities from multiperil policies, which 
would likely result in the need for additional borrowing 
authority from the Treasury. In the latter case, the 
legislation would prohibit FEMA from entering into or renewing 
any multiperil policy until such borrowing is repaid. CBO 
expects that the new coverage offered under H.R. 3121 would 
increase premium receipts and additional claims payments by 
about the same amount--resulting in no significant net 
budgetary impact.
    Increased coverage limits and new lines of coverage. 
Sections 8 and 9 would increase the total amount of flood 
insurance coverage available to a residential customer from 
$350,000 to $470,000, and to a commercial business from $1.0 
million to $1.3 million. The legislation would direct FEMA to 
include coverage of up to $1,000 for living expenses in all 
future polices. Additional optional coverage also would be 
available for living expenses, repairs to residential basements 
and crawl spaces, business interruption, and the full 
replacement of contents.
    As of June 2007, the NFIP had approximately 5.5 million 
policies in force, with a total exposure of over $1 trillion. 
Those policyholders pay about $2.7 billion in premiums to the 
federal government annually. Under the bill, the increased 
coverage limits and new lines of insurance would be offered to 
policyholders when they initiate or renew their policies and 
that coverage would be offered at actuarial rates. Thus, CBO 
expects that any additional insurance coverage obtained under 
this provision would increase premium receipts to the federal 
government, which would--on average--be roughly offset by 
additional claims payments.
    Increase in annual limit on rate increases. Section 11 
would authorize the NFIP to increase rates on policies within a 
specified risk category by an average of up to 15 percent per 
year. Under current law, the limit is 10 percent. CBO estimates 
that raising this limit would have no significant impact on the 
federal budget because to date FEMA has not been constrained in 
its rate-setting process by the current cap on premiums for 
actuarially priced policies. (Rate increases for subsidized 
policies would be affected by other provisions of the bill.)

Spending subject to appropriation

    Implementing H.R. 3121 would increase discretionary 
spending by $1.8 billion over the 2008-2012 period, assuming 
appropriation of the authorized amounts.
    Flood Mapping Program. Section 22 would authorize the 
appropriation of $400 million per year over the 2008-2013 
period for updating flood maps to include the 500-year flood 
plain, as well as areas that would be flooded if a dam or levee 
failed. In addition, the bill would reestablish a 14-member 
Technical Mapping Advisory Council to assist with managing 
flood mapping activities. Based on historical spending patterns 
for this program, CBO estimates that implementing this section 
would cost $1.5 billion over the 2008-2012 period and an 
additional $900 million after 2012.
    Grants for outreach to property owners and renters. Section 
15 would authorize the appropriation of $250 million over the 
2008-2012 period for grants to communities participating in the 
NFIP to conduct educational and outreach activities to 
encourage the purchase of flood insurance and raise the 
awareness of flood risk and measures that can be taken to 
mitigate flood damages. Based on the historical spending 
patterns of similar programs, CBO estimates that implementing 
this provision would cost $218 million over the 2008-2012 
period, assuming appropriation of the specified amounts.
    Mitigation of severe repetitive loss properties. Section 17 
would extend for three years the authorization of 
appropriations for the mitigation pilot program that funds 
preventive measures for certain properties that have been 
frequently flooded (known as severe repetitive loss 
properties). Severe repetitive loss properties are those that 
have sustained four or more losses totaling more than $20,000, 
or two or more losses that cumulatively exceed the value of the 
property. Under current law, up to $40 million a year from the 
National Flood Insurance Fund can be used for this program 
through 2009. Based on historical spending rates for mitigation 
projects, CBO estimates that implementing this section would 
cost $88 million over the 2008-2012 period.
    Additional studies. H.R. 3121 would authorize the 
Government Accountability Office to conduct studies of pre-FIRM 
properties, the feasibility of expanding the requirement to 
purchase flood insurance, and potential methods for increasing 
the participation of low-income families in the NFIP. The bill 
also would direct FEMA to conduct studies on the impact of 
using nationally recognized building codes as a part of flood-
plain management and the economic effects of eliminating the 
discounted premiums paid by owners of certain pre-FIRM 
properties. CBO estimates that preparing those studies would 
cost $1 million in fiscal year 2008.
    Staff increases. Section 25 would authorize FEMA to hire 
additional staff to implement the provisions of this bill. The 
amount of increased administrative costs that would result from 
the bill is uncertain because FEMA does not yet know how it 
would implement various provisions. Subject to appropriation of 
administrative expenses, FEMA is authorized to set an 
administrative cost recovery fee on flood insurance policies to 
offset spending on salaries and expenses. Thus, CBO expects 
additional administrative costs under the bill would not have a 
significant net cost.
    Estimated impact on state, local, and tribal governments: 
H.R. 3121 contains no intergovernmental mandates as defined in 
UMRA. Assuming appropriation of authorized amounts, CBO 
estimates state, local, and tribal governments would receive up 
to $300 million over the 2008-2012 period for outreach and 
flood mitigation activities. Any costs to those governments 
would be incurred voluntarily as a condition of receiving 
federal assistance.
    Estimated impact on the private sector: H.R. 3121 would 
impose a private-sector mandate, as defined in UMRA, on certain 
mortgage lenders. Based on information from FEMA and industry 
sources, CBO expects that the direct costs to comply with the 
mandate would be small and fall below the annual threshold for 
private-sector mandates established in UMRA ($131 million in 
2007, adjusted annually for inflation).
    Under current law, mortgage lenders who make federally 
related mortgages, as defined in title 12 U.S.C. 2602, are 
required to provide a good-faith estimate of the amount or 
range of charges the borrower is likely to incur for specific 
settlement services. The bill would require such mortgage 
lenders to include in each good-faith estimate a conspicuous 
statement that flood insurance coverage for residential real 
estate is generally available under the National Flood 
Insurance Program whether or not the real estate is located in 
an area having special flood hazards and that to obtain such 
coverage, a home owner or purchaser should contact the NFIP. 
The good-faith estimate also would be required to contain a 
telephone number and Web site address by which a home owner or 
purchaser can contact the NFIP. Finally, the estimate would be 
required to contain the statement that the escrowing of flood 
insurance premiums is required for many loans under section 
102(d) of the Flood Disaster Protection Act of 1973, and may be 
a convenient and available option with respect to other loans. 
According to industry representatives, the cost for mortgage 
lenders to include the required additional statements in such 
an estimate would be minimal.
    Estimate prepared by: Federal Costs: Daniel Hoople; Impact 
on State, Local, and Tribal Governments: Melissa Merrell; 
Impact on the Private Sector: Paige Piper/Bach.
    Estimate approved by: Peter H. Fontaine, Assistant Director 
for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that the 
Constitutional Authority of Congress to enact this legislation 
is provided by Article 1, section 8, clause 1 (relating to the 
general welfare of the United States) and clause 3 (relating to 
the power to regulate interstate commerce).

                  Applicability to Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act.

                         Earmark Identification

    H.R. 3121 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                  Exchange of Committee Correspondence

                          House of Representatives,
            Committee on Transportation and Infrastructure,
                                Washington, DC, September 21, 2007.
Hon. Barney Frank,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Chairman Frank: I write to you regarding H.R. 3121, 
the ``Flood Insurance Reform and Modernization Act of 2007''.
    H.R. 3121 contains provisions that fall within the 
jurisdiction of the Committee on Transportation and 
Infrastructure. I recognize and appreciate your desire to bring 
this legislation before the House in an expeditious manner and, 
accordingly, I will not seek a sequential referral of the bill. 
However, I agree to waive consideration of this bill with the 
mutual understanding that my decision to forego a sequential 
referral of the bill does not waive, reduce, or otherwise 
affect the jurisdiction of the Committee on Transportation and 
Infrastructure over H.R. 3121.
    Further, the Committee on Transportation and Infrastructure 
reserves the right to seek the appointment of conferees during 
any House-Senate conference convened on this legislation on 
provisions of the bill that are within the Committee's 
jurisdiction. I ask for your commitment to support any request 
by the Committee on Transportation and Infrastructure for the 
appointment of conferees on H.R. 3121 or similar legislation.
    Please place a copy of this letter and your response 
acknowledging the Committee on Transportation and 
Infrastructure's jurisdictional interest in the Committee 
Report on H.R. 3121 and in the Congressional Record during 
consideration of the measure on the House Floor.
    I look forward to working with you as we prepare to pass 
this important legislation.
            Sincerely,
                                   James L. Oberstar, M.C.,
                                                          Chairman.
                                ------                                

                          House of Representatives,
                           Committee on Financial Services,
                                Washington, DC, September 20, 2007.
Hon. James L. Oberstar,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: Thank you for your letter concerning 
H.R. 3121, the ``Flood Insurance Reform and Modernization Act 
of 2007''. This bill was introduced on July 19, 2007, and has 
been ordered reported by the Committee on Financial Services. 
It is my expectation that this legislation will be scheduled 
for floor consideration shortly.
    I recognize that certain provisions in the bill fall within 
the jurisdiction of the Committee on Transportation and 
Infrastructure under Rule X of the Rules of the House of 
Representatives. However, I appreciate your willingness to 
forego action on this legislation in order to allow the bill to 
come to the floor expeditiously. I agree that your decision 
will not prejudice the Committee on Transportation and 
Infrastructure with respect to its jurisdictional prerogatives 
on this or similar legislation. I will support appropriate 
representation from the Transportation Committee in the event 
of a House-Senate conference on this bill or similar 
legislation.
    I will include this exchange of correspondence in the 
Committee report and in the Congressional Record during 
consideration of this measure on the floor. Thank you again for 
your cooperation in this important matter.
                                              Barney Frank,
                                                          Chairman.

             Section-by-Section Analysis of the Legislation

Section 1--Short title and table of contents

    This Act may be cited as the ``Flood Insurance Reform and 
Modernization Act of 2007.''

Section 2--Findings and Purposes

    This section sets forth findings regarding the need for 
reform of the NFIP and establishes the purposes of the Act.

Section 3--Study regarding status of pre-FIRM properties and mandatory 
        purchase requirement for natural 100-year floodplain and non-
        federally related loans

    This section requires the Government Accountability Office 
(``GAO'') to conduct a study on the effects of extending the 
mandatory flood insurance purchase requirement to all 
properties located in a flood hazard area, whether or not the 
mortgage on the property is federally-backed. This section also 
requires the GAO to study coverage for pre-FIRM properties, as 
well as the effects of extending the mandatory purchase 
requirement to properties protected by dams and levees. This 
report is to be submitted to the Congress no later than 6 
months from enactment.

Section 4--Phase-in of actuarial rates for non-residential properties 
        and non-primary residences

    This section requires the phase-in of actuarial rates (or 
the phase-out of subsidized rates), for pre-FIRM nonresidential 
properties and non-primary residences beginning on January 1, 
2011. The phase-in does not apply to multifamily rental 
properties or rentals that are the primary residence of a 
tenant.

Section 5--Exception to waiting period for effective date of policies

    This section makes flood insurance coverage effective 
immediately when a policy is purchased within 30 days of 
purchase or transfer of the property.

Section 6--Enforcement (increasing penalties for lender non-compliance)

    This section increases to $2,000 the fine levied against 
federally-regulated lending institutions for each failure to 
enforce mandatory flood insurance purchase requirements and 
increases the annual cap on fines for institutions to $1 
million. This cap will not apply to institutions that were 
assessed a penalty of $1 million in any three of the last five 
years. This section also contains a ``safe harbor'' provision 
for lending institutions that make a good faith effort to 
comply with mandatory flood insurance purchase requirements, or 
if such a violation is not material in nature.

Section 7--Multiperil coverage for flood and windstorm

    This section expands the NFIP to make optional wind 
coverage available to NFIP participants. This section requires 
premiums for the new, optional coverage to be charged at 
actuarial rates and be based on risk, so that the program would 
be required to collect enough premiums to pay reasonably 
anticipated claims.
    Under this section, optional wind coverage would be 
available where local governments agree to adopt land use and 
control measures designed to minimize wind damage, in addition 
to the existing flood program requirements for flood plain 
management. The multiple peril residential policy limits are 
$500,000 for the structures and $150,000 for contents and loss 
of use. Limits for nonresidential properties are up to 
$1,000,000 for structure and $750,000 for contents and business 
interruption.
    The NFIP may not offer new multiple-peril policies or renew 
existing multiple-peril policies during any time the NFIP 
borrows money to pay multiple-peril policy claims.
    The effective date for coverage under this section is June 
30, 2008.

Section 8--Maximum coverage limits

    This section increases the maximum coverage limits for 
flood insurance policies. New coverage limits are $335,000 for 
residences; $135,000 for residential contents; and $670,000 for 
nonresidential properties.

Section 9--Coverage for additional living expenses, basement 
        improvements, business interruption, and replacement cost of 
        contents

    This section requires FEMA to include in each renewal or 
new contract for flood insurance at least $1,000 for living 
expenses following a flood event. This section also requires 
FEMA to provide actuarially-priced, optional residential 
basement coverage for flood losses. Optional, actuarially-
priced business interruption coverage for flood losses is also 
to be provided by FEMA for commercial properties (including 
multifamily rental properties). This section also requires FEMA 
to provide optional, full replacement cost contents coverage 
for both residential and commercial properties.

Section 10--Notification to tenants of availability of contents 
        coverage

    This section requires FEMA to provide copies of the notice 
document to insured landlords, in order to strongly encourage 
landlords to provide tenants with this notice, so that tenants 
may be informed about the property's location in a flood zone, 
the availability of flood insurance coverage, and how to 
purchase the coverage. This provision does not include 
penalties in the event that FEMA does not comply with this 
section or a landlord fails to distribute the notice.

Section 11--Increase in annual limitation on premium increases

    This section increases the annual limitation on premium 
increases from 10 percent to 15 percent.

Section 12--Increase in borrowing authority

    This section increases the NFIP's borrowing authority to 
$21.5 billion from the current $20.775 billion. This section 
also requires that FEMA submit a report to Congress, not later 
than 6 months after enactment of this legislation, on how it 
intends to repay, within 10 years, all funds borrowed, 
including amounts previously borrowed but not repaid.

Section 13--FEMA participation in State disaster claims mediation 
        programs

    This section requires FEMA, upon request of a state 
insurance commissioner, to participate in a state disaster 
claims mediation program for the non-binding mediation of flood 
insurance claims. However, this section stipulates that 
participation in the mediation program will not affect contract 
or tort liability, or the exclusive jurisdiction of the Federal 
courts to hear disputes involving the NFIP. Further, this 
section does not require the NFIP to pay additional mediation 
fees upon participation.

Section 14--FEMA annual report on insurance program

    This section requires FEMA to report annually to Congress 
on the financial status of the NFIP.

Section 15--Flood insurance outreach

    This section creates a competitive grant program for 
communities that encourage homeowners to purchase flood 
insurance, where those homeowners are not legally required to 
do so, and in general, educate all residents about the benefits 
of flood insurance. This section also requires FEMA to report 
to Congress within 60 days of enactment a description of its 
marketing and outreach efforts to educate consumers on the 
benefits of obtaining flood insurance.

Section 16--Grants for direct funding of mitigation activities for 
        individual repetitive claims properties

    This section provides a technical fix from 2004 flood 
insurance legislation to clarify that the FEMA Director may 
work directly with property owners to make mitigation grants 
for certain repetitive loss properties where States or 
communities are either unable or unwilling to address 
repetitive loss issues with a property owner.

Section 17--Extension of pilot program for mitigation of severe 
        repetitive loss properties

    This section extends the pilot program, which was created 
in the 2004 flood insurance legislation, through September 30, 
2012.

Section 18--Flood Mitigation Assistance Program

    This section provides for technical fixes to the 2004 flood 
insurance legislation by: (1) adding demolition and rebuilding 
as an allowable mitigation activity under the Flood Mitigation 
Assistance (``FMA'') program (in some cases, demolition and 
rebuilding is a more feasible and cost effective mitigation 
option); (2) removing the per state and per community caps on 
FMA to allow FEMA to better use FMA funds where needed; and (3) 
prevents FEMA from increasing policy premiums to cover FMA.

Section 19--GAO study of methods to increase flood insurance program 
        participation by low-income families

    This section requires the GAO to study and report on 
methods to increase participation of low-income families in the 
flood insurance program. This report is to be submitted to 
Congress no later than 12 months from enactment.

Section 20--Notice of availability of flood insurance and escrow in 
        RESPA Good Faith Estimate

    This section requires disclosure in the Real Estate 
Settlement Procedures Act Good Faith Estimate about the 
availability of flood insurance and clarifies that the 
disclosure state that flood insurance is available whether or 
not a property is in a flood zone.

Section 21--Reiteration of FEMA responsibilities under 2004 reform act

    This section requires FEMA, within 90 days of enactment, to 
establish an appeals process for claims. FEMA must continue to 
work with state regulators and the industry to implement 
minimum agent training requirements. FEMA must report to 
Congress after six months on the status of implementing all 
2004 reforms.

Section 22--Ongoing modernization of flood maps and elevation standards

    This section makes the map modernization program ongoing; 
requires the mapping of the 500-year floodplain (but such 500-
year mapping may not delay the mapping of a community's 100-
year floodplain map); gives priority in updating maps to areas 
affected by hurricanes Katrina and Rita; creates a 
responsibility for FEMA to educate communities about map 
updates; and establishes the trigger for pre-FIRM subsidy phase 
out of second and vacation homes as of January 1, 2011. This 
provision also authorizes appropriations for mapping of $400 
million annually, an increase from the current appropriated 
level of $200 million. This section also makes the Technical 
Mapping Advisory Council ongoing (and adds a real estate 
professional to the Council). The section also provides that if 
a map must be updated to reflect changes to protective 
structures under the jurisdiction of the Federal Government, 
the cost of such update will not be at the expense of the 
community. Also, this section provides that FEMA may issue 
interim flood elevations after a flood-related disaster.

Section 23--Notification and appeal of map changes; notification of 
        establishment of flood elevations

    This section requires FEMA to provide map change 
information to affected communities, and requires a notice in 
local newspapers of map changes, a description of the appeals 
process, and contact information for an appeal.

Section 24--Clarification of replacement cost provisions, forms, and 
        policy language

    This section requires FEMA, within 3 months of enactment, 
to issue regulations and revise materials to provide a plain 
language clarification of replacement cost coverage; revise 
flood insurance policies to be consistent with language in 
homeowners policies; and require the use of plain language 
forms developed pursuant to the Bunning-Bereuter-Blumenauer 
Flood Insurance Reform Act of 2004.

Section 25--Authorization of additional FEMA staff

    This section authorizes necessary funds be appropriated for 
the Director of FEMA to employ additional staff necessary to 
carry out all of the responsibilities required by this bill.

Section 26--Extension of deadline for filing proof of loss

    This section extends the deadline for filing the proof of 
loss associated with a flood insurance claim from 60 days to 
180 days.

Section 27--5-year extension of program

    This section reauthorizes the NFIP for five years through 
2013. The current authorization of the NFIP expires in 2008.

Section 28--Report on inclusion of building codes in floodplain 
        management criteria

    This section requires FEMA to conduct a study and report to 
Congress not later than six months after enactment regarding 
the use of nationally recognized building codes as part of 
floodplain management.

Section 29--Study of economic effects of charging actuarially-based 
        premium rates for pre-FIRM structures

    This section requires FEMA to conduct a study and report to 
Congress within 12 months of enactment regarding the economic 
effects of removing the subsidy for pre-FIRM properties.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

                  NATIONAL FLOOD INSURANCE ACT OF 1968

           *       *       *       *       *       *       *
TITLE XIII--NATIONAL FLOOD INSURANCE

           *       *       *       *       *       *       *

            CHAPTER I--THE NATIONAL FLOOD INSURANCE PROGRAM

                            BASIC AUTHORITY

  Sec. 1304. (a) * * *

           *       *       *       *       *       *       *

  (c) Multiperil Coverage for Damage From Flood or Windstorm.--
          (1) In general.--Subject to paragraph (8), the 
        national flood insurance program established pursuant 
        to subsection (a) shall enable the purchase of optional 
        insurance against loss resulting from physical damage 
        to or loss of real property or personal property 
        related thereto located in the United States arising 
        from any flood or windstorm, subject to the limitations 
        in this subsection and section 1306(b).
          (2) Community participation requirement.--Multiperil 
        coverage pursuant to this subsection may not be 
        provided in any area (or subdivision thereof) unless an 
        appropriate public body shall have adopted adequate 
        land use and control measures (with effective 
        enforcement provisions) which the Director finds are 
        consistent with the comprehensive criteria for land 
        management and use relating to windstorms establish 
        pursuant to section 1361(d)(2).
          (3) Prohibition against duplicative coverage.--
        Multiperil coverage pursuant to this subsection may not 
        be provided with respect to any structure (or the 
        personal property related thereto) for any period 
        during which such structure is covered, at any time, by 
        flood insurance coverage made available under this 
        title.
          (4) Nature of coverage.--Multiperil coverage pursuant 
        to this subsection shall--
                  (A) cover losses only from physical damage 
                resulting from flooding or windstorm; and
                  (B) provide for approval and payment of 
                claims under such coverage upon proof that such 
                loss must have resulted from either windstorm 
                or flooding, but shall not require for approval 
                and payment of a claim that the specific cause 
                of the loss, whether windstorm or flooding, be 
                distinguished or identified.
          (5) Actuarial rates.--Multiperil coverage pursuant to 
        this subsection shall be made available for purchase 
        for a property only at chargeable risk premium rates 
        that, based on consideration of the risks involved and 
        accepted actuarial principles, and including operating 
        costs and allowance and administrative expenses, are 
        required in order to make such coverage available on an 
        actuarial basis for the type and class of properties 
        covered.
          (6) Terms of coverage.--The Director shall, after 
        consultation with persons and entities referred to in 
        section 1306(a), provide by regulation for the general 
        terms and conditions of insurability which shall be 
        applicable to properties eligible for multiperil 
        coverage under this subsection, subject to the 
        provisions of this subsection, including--
                  (A) the types, classes, and locations of any 
                such properties which shall be eligible for 
                such coverage, which shall include residential 
                and nonresidential properties;
                  (B) subject to paragraph (7), the nature and 
                limits of loss or damage in any areas (or 
                subdivisions thereof) which may be covered by 
                such coverage;
                  (C) the classification, limitation, and 
                rejection of any risks which may be advisable;
                  (D) appropriate minimum premiums;
                  (E) appropriate loss deductibles; and
                  (F) any other terms and conditions relating 
                to insurance coverage or exclusion that may be 
                necessary to carry out this subsection.
          (7) Limitations on amount of coverage.--The 
        regulations issued pursuant to paragraph (6) shall 
        provide that the aggregate liability under multiperil 
        coverage made available under this subsection shall not 
        exceed the lesser of the replacement cost for covered 
        losses or the following amounts, as applicable:
                  (A) Residential structures.--In the case of 
                residential properties--
                          (i) for any single-family dwelling, 
                        $500,000; and
                          (ii) for any structure containing 
                        more than one dwelling unit, $500,000 
                        for each separate dwelling unit in the 
                        structure; and
                          (iii) $150,000 per dwelling unit 
                        for--
                                  (I) any contents related to 
                                such unit; and
                                  (II) any necessary increases 
                                in living expenses incurred by 
                                the insured when losses from 
                                flooding or windstorm make the 
                                residence unfit to live in.
                  (B) Nonresidential properties.--In the case 
                of nonresidential properties (including church 
                properties)--
                          (i) $1,000,000 for any single 
                        structure; and
                          (ii) $750,000 for--
                                  (I) any contents related to 
                                such structure;
                                  (II) in the case of any 
                                nonresidential property that is 
                                a business property, any losses 
                                resulting from any partial or 
                                total interruption of the 
                                insured's business caused by 
                                damage to, or loss of, such 
                                property from flooding or 
                                windstorm, except that for 
                                purposes of such coverage, 
                                losses shall be determined 
                                based on the profits the 
                                covered business would have 
                                earned, based on previous 
                                financial records, had the 
                                flood or windstorm not 
                                occurred.
          (8) Requirement to cease offering coverage if 
        borrowing to pay claims.--If at any time the Director 
        utilizes the borrowing authority under section 1309(a) 
        for the purpose of obtaining amounts to pay claims 
        under multiperil coverage made available under this 
        subsection, the Director may not, during the period 
        beginning upon the initial such use of such borrowing 
        authority and ending upon repayment to the Secretary of 
        the Treasury of the full amount of all outstanding 
        notes and obligations issued by the Director for such 
        purpose, together with all interest owed on such notes 
        and obligations, enter into any new policy, or renew 
        any existing policy, for coverage made available under 
        this subsection.
          (9) Effective date.--This subsection shall take 
        effect on, and shall apply beginning on, June 30, 2008.
  [(c)] (d) In carrying out the flood insurance program the 
Director shall, to the maxmium extent practicable, encourage 
and arrange for--
          (1) * * *

           *       *       *       *       *       *       *

              NATURE AND LIMITATION OF INSURANCE COVERAGE

  Sec. 1306. (a) * * *
  (b) In addition to any other terms and conditions under 
subsection (a), such regulations shall provide that--
          (1) * * *
          (2) in the case of any residential property for which 
        the risk premium rate is determined in accordance with 
        the provisions of section 1307(a)(1), additional flood 
        insurance in excess of the limits specified in clause 
        (i) of subparagraph (A) of paragraph (1) shall be made 
        available to every insured upon renewal and every 
        applicant of insurance so as to enable such insured or 
        applicant to receive coverage up to a total amount 
        (including such limits specified in paragraph 
        (1)(A)(i)) of [$250,000] $335,000;
          (3) in the case of any residential property for which 
        the risk premium rate is determined in accordance with 
        the provisions of section 1307(a)(1), additional flood 
        insurance in excess of the limits specified in clause 
        (ii) of subparagraph (A) of paragraph (1) shall be made 
        available to every insured upon renewal and every 
        applicant for insurance so as to enable any such 
        insured or applicant to receive coverage up to a total 
        amount (including such limits specified in paragraph 
        (1)(A)(ii)) of [$100,000] $135,000;
          (4) in the case of any nonresidential property, 
        including churches, for which the risk premium rate is 
        determined in accordance with the provisions of section 
        1307(a)(1), additional flood insurance in excess of the 
        limits specified in subparagraphs (B) and (C) of 
        paragraph (1) shall be made available to every insured 
        upon renewal and every applicant for insurance, in 
        respect to any single structure, up to a total amount 
        (including such limit specified in subparagraph (B) or 
        (C) of paragraph (1), as applicable) of [$500,000] 
        $670,000 for each structure and [$500,000] $670,000 for 
        any contents related to each structure; [and]
          (5) any flood insurance coverage pursuant to 
        paragraph (2), (3), or (4) which may be made available 
        in excess of the limits specified in subparagraph (A), 
        (B), or (C) of paragraph (1), shall be based only on 
        chargeable premium rates under section 1308 which are 
        not less than the estimated premium rates under section 
        1307(a)(1), and the amount of such excess coverage 
        shall not in any case exceed an amount equal to the 
        applicable limit so specified (or allocated) under 
        paragraph (1)(C), (2), (3), or (4), as applicable[.];
          (6) in the case of any residential property, each 
        renewal or new contract for flood insurance coverage 
        shall provide not less than $1,000 aggregate liability 
        per dwelling unit for any necessary increases in living 
        expenses incurred by the insured when losses from a 
        flood make the residence unfit to live in, which 
        coverage shall be available only at chargeable rates 
        that are not less than the estimated premium rates for 
        such coverage determined in accordance with section 
        1307(a)(1);
          (7) in the case of any residential property, optional 
        coverage for additional living expenses described in 
        paragraph (6) shall be made available to every insured 
        upon renewal and every applicant in excess of the 
        limits provided in paragraph (6) in such amounts and at 
        such rates as the Director shall establish, except that 
        such chargeable rates shall not be less than the 
        estimated premium rates for such coverage determined in 
        accordance with section 1307(a)(1);
          (8) in the case of any residential property, optional 
        coverage for losses, resulting from floods, to 
        improvements and personal property located in 
        basements, crawl spaces, and other enclosed areas under 
        buildings that are not covered by primary flood 
        insurance coverage under this title, shall be made 
        available to every insured upon renewal and every 
        applicant, except that such coverage shall be made 
        available only at chargeable rates that are not less 
        than the estimated premium rates for such coverage 
        determined in accordance with section 1307(a)(1);
          (9) in the case of any commercial property or other 
        residential property, including multifamily rental 
        property, optional coverage for losses resulting from 
        any partial or total interruption of the insured's 
        business caused by damage to, or loss of, such property 
        from a flood shall be made available to every insured 
        upon renewal and every applicant, except that--
                  (A) for purposes of such coverage, losses 
                shall be determined based on the profits the 
                covered business would have earned, based on 
                previous financial records, had the flood not 
                occurred; and
                  (B) such coverage shall be made available 
                only at chargeable rates that are not less than 
                the estimated premium rates for such coverage 
                determined in accordance with section 
                1307(a)(1); and
          (10) in the case of any residential property and any 
        commercial property, optional coverage for the full 
        replacement costs of any contents related to the 
        structure that exceed the limits of coverage otherwise 
        provided in this subsection shall be made available to 
        every insured upon renewal and every applicant, except 
        that such coverage shall be made available only at 
        chargeable rates that are not less than the estimated 
        premium rates for such coverage determined in 
        accordance with section 1307(a)(1).
  (c) Effective Date of Policies.--
          (1) * * *
          (2) Exception.--The provisions of paragraph (1) shall 
        not apply to--
                  (A) the initial purchase of flood insurance 
                coverage under this title when the purchase of 
                insurance is in connection with the making, 
                increasing, extension, or renewal of a loan or 
                is in connection with the purchase or other 
                transfer of the property for which the coverage 
                is provided (regardless of whether a loan is 
                involved in the purchase or transfer 
                transaction), but only when such initial 
                purchase of coverage is made not later 30 days 
                after such making, increasing, extension, or 
                renewal of the loan or not later than 30 days 
                after such purchase or other transfer of the 
                property, as applicable; or

           *       *       *       *       *       *       *

               ESTABLISHMENT OF CHARGEABLE PREMIUM RATES

  Sec. 1308. (a) * * *

           *       *       *       *       *       *       *

  (c) Actuarial Rate Properties.--Subject only to [the 
limitations provided under paragraphs (1) and (2)] subsection 
(e), the chargeable rate shall not be less than the applicable 
estimated risk premium rate for such area (or subdivision 
thereof) under section 1307(a)(1) with respect to the following 
properties:
          (1) Post-firm properties.--Any property the 
        construction or substantial improvement of which the 
        Director determines has been started after December 31, 
        1974, or started after the effective date of the 
        initial rate map published by the Director under 
        paragraph (2) of section 1360 for the area in which 
        such property is located, whichever is later[, except 
        that the chargeable rate for properties under this 
        paragraph shall be subject to the limitation under 
        subsection (e)].
          (2) Nonresidential properties.--Any nonresidential 
        property, which term shall not include any multifamily 
        rental property that consists of four or more dwelling 
        units.
          (3) Non-primary residences.--Any residential property 
        that is not the primary residence of any individual, 
        including the owner of the property or any other 
        individual who resides in the property as a tenant.
          [(2)] (4) Certain leased coastal and river 
        properties.--Any property leased from the Federal 
        Government (including residential and nonresidential 
        properties) that the Director determines is located on 
        the river-facing side of any dike, levee, or other 
        riverine flood control structure, or seaward of any 
        seawall or other coastal flood control structure.

           *       *       *       *       *       *       *

  (e) Annual Limitation on Premium Increases.--Except with 
respect to properties described under [paragraph (2) or (3)] 
paragraph (4) of subsection (c), and notwithstanding any other 
provision of this title, the chargeable risk premium rates for 
flood insurance under this title for any properties within any 
single risk classification may not be increased by an amount 
that would result in the average of such rate increases for 
properties within the risk classification during any 12-month 
period exceeding [10 percent] 15 percent of the average of the 
risk premium rates for properties within the risk 
classification upon the commencement of such 12-month period.

           *       *       *       *       *       *       *

SEC. 1308A. NOTIFICATION TO TENANTS OF AVAILABILITY OF CONTENTS 
                    INSURANCE.

  (a) In General.--The Director shall, upon entering into a 
contract for flood insurance coverage under this title for any 
property located in an area having special flood hazards--
          (1) provide to the insured sufficient copies of the 
        notice developed pursuant to subsection (b); and
          (2) strongly encourage the insured to provide a copy 
        of the notice, or otherwise provide notification of the 
        information under subsection (b) in the manner that the 
        manager or landlord deems most appropriate, to each 
        such tenant and to each new tenant upon commencement of 
        such a tenancy.
  (b) Notice.--Notice to a tenant of a property in accordance 
with this subsection is written notice that clearly informs a 
tenant--
          (1) that the property is located in an area having 
        special flood hazards;
          (2) that flood insurance coverage is available under 
        the national flood insurance program under this title 
        for contents of the unit or structure leased by the 
        tenant;
          (3) of the maximum amount of such coverage for 
        contents available under this title at that time; and
          (4) of where to obtain information regarding how to 
        obtain such coverage, including a telephone number, 
        mailing address, and location on the World Wide Web of 
        the Director where such information is available.

                               FINANCING

  Sec. 1309. (a) All authority which was vested in the Housing 
and Home Finance Administrator by virtue of section 15(e) of 
the Federal Flood Insurance Act of 1956 (70 Stat. 1084) 
(pertaining to the issue of notes or other obligations or the 
Secretary of the Treasury), as amended by subsections (a) and 
(b) of section 1303 of this Act, shall be available to the 
Director for the purpose of carrying out the flood insurance 
program under this title; except that the total amount of notes 
and obligations which may be issued by the Director pursuant to 
such authority (1) without the approval of the President, may 
not exceed $500,000,000, and (2) with the approval of the 
President, may not exceed $1,500,000,000 through the date 
specified in section 1319, and $1,000,000,000 thereafter; 
except that, through September 30, 2008, clause (2) of this 
sentence shall be applied by substituting ``[$20,775,000,000] 
$21,500,000,000'' for ``$1,500,000,000''. The Director shall 
report to the Committee on Banking, Finance and Urban Affairs 
of the House of Representatives and the Committee on Banking, 
Housing, and Urban Affairs of the Senate at any time when he 
requests the approval of the President in accordance with the 
preceding sentence.

           *       *       *       *       *       *       *

                     NATIONAL FLOOD INSURANCE FUND

  Sec. 1310. (a) To carry out the flood insurance program 
authorized by this title, the Director shall establish in the 
Treasury of the United States a National Flood Insurance Fund 
(hereinafter referred to as the ``fund'') which shall be an 
account separate from any other accounts or funds available to 
the Director and shall be available as described in subsection 
(f), without fiscal year limitation (except as otherwise 
provided in this section)--
  (1) * * *

           *       *       *       *       *       *       *

  (9) for funding, not to exceed $10,000,000 in any fiscal 
year, which shall remain available until expended, for 
mitigation actions under section 1323, except that, 
notwithstanding any other provision of this title, amounts made 
available pursuant to this paragraph shall not be subject to 
offsetting collections through premium rates for flood 
insurance coverage under this title.

           *       *       *       *       *       *       *

                           PAYMENT OF CLAIMS

  Sec. 1312. (a) Payment.--The Director is authorized to 
prescribe regulations establishing the general method or 
methods by which proved and approved claims for losses may be 
adjusted and paid for any damage to or loss of property which 
is covered by flood insurance made available under the 
provisions of this title.
  (b) Filing Deadline for Proof of Loss.--
          (1) In general.--In establishing any requirements 
        regarding notification, proof, or approval of claims 
        for damage to or loss of property which is covered by 
        flood insurance made available under this title, the 
        Director may not require an insured to notify the 
        Director of such damage or loss, submit a claim for 
        such damage or loss, or certify to or submit proof of 
        such damage or loss, before the expiration of the 180-
        day period that begins on the date that such damage or 
        loss occurred.
          (2) Exceptions.--Notwithstanding any deadline 
        established in accordance with paragraph (1), the 
        Director may not deny a claim for damage or loss 
        described in such paragraph solely for failure to meet 
        such deadline if the insured demonstrates any good 
        cause for such failure.

           *       *       *       *       *       *       *

                PROHIBITION AGAINST DUPLICATIVE COVERAGE

  Sec. 1314. Flood insurance under this title may not be 
provided with respect to any structure (or the personal 
property related thereto) for any period during which such 
structure is covered, at any time, by multiperil insurance 
coverage made available pursuant to section 1304(c).

           *       *       *       *       *       *       *

             PROPERTIES IN VIOLATION OF STATE AND LOCAL LAW

  Sec. 1316. (a) Flood Protection Measures.--No new flood 
insurance coverage shall be provided under this title for any 
property which the Director finds has been declared by a duly 
constituted State or local zoning authority, or other 
authorized public body, to be in violation of State or local 
laws, regulations or ordinances which are intended to 
discourage or otherwise restrict land development or occupancy 
in flood-prone areas.
  (b) Windstorm Protection Measures.--No new multiperil 
coverage shall be provided under section 1304(c) for any 
property that the Director finds has been declared by a duly 
constituted State or local zoning authority, or other 
authorized public body to be in violation of State or local 
laws, regulations, or ordinances, which are intended to reduce 
damage caused by windstorms.

           *       *       *       *       *       *       *

                           PROGRAM EXPIRATION

  Sec. 1319. No new contract for flood insurance under this 
title shall be entered into after [September 30, 2008] 
September 30, 2013.

          [REPORT TO THE PRESIDENT] ANNUAL REPORT TO CONGRESS

  Sec. 1320. (a) In General.--The Director shall [biennially] 
submit a report of operations under this title to [the 
President for submission to] the Congress not later than June 
30 of each year.
  (b) Effects of Flood Insurance Program.--The Director shall 
include, as part of the [biennial] annual report submitted 
under subsection (a), a chapter reporting on the effects on the 
flood insurance program observed through implementation of 
requirements under the Riegle Community Development and 
Regulatory Improvement Act of 1994.
  (c) Financial Status of Program.--The report under this 
section for each year shall include information regarding the 
financial status of the national flood insurance program under 
this title, including a description of the financial status of 
the National Flood Insurance Fund and current and projected 
levels of claims, premium receipts, expenses, and borrowing 
under the program.

           *       *       *       *       *       *       *

SEC. 1323. DIRECT GRANTS FOR REPETITIVE INSURANCE CLAIMS PROPERTIES.

  (a) In General.--The Director may provide funding, to owners 
of such properties, for mitigation actions that reduce flood 
damages to individual properties for which [1] two or more 
claim payments for losses have been made under flood insurance 
coverage under this title, but only if the Director determines 
that--
          (1) * * *

           *       *       *       *       *       *       *

SEC. 1325. FEMA PARTICIPATION IN STATE DISASTER CLAIMS MEDIATION 
                    PROGRAMS.

  (a) Requirement To Participate.--In the case of the 
occurrence of a natural catastrophe that may have resulted in 
flood damage covered by insurance made available under the 
national flood insurance program and a loss covered by personal 
lines residential property insurance policy, upon request made 
by the insurance commissioner of a State (or such other 
official responsible for regulating the business of insurance 
in the State) for the participation of representatives of the 
Director in a program sponsored by such State for nonbinding 
mediation of insurance claims resulting from a natural 
catastrophe, the Director shall cause such representatives to 
participate in such State program, when claims under the 
national flood insurance program are involved, to expedite 
settlement of flood damage claims resulting from such 
catastrophe.
  (b) Extent of Participation.--Participation by 
representatives of the Director required under subsection (a) 
with respect to flood damage claims resulting from a natural 
catastrophe shall include--
          (1) providing adjusters certified for purposes of the 
        national flood insurance program who are authorized to 
        settle claims against such program resulting from such 
        catastrophe in amounts up to the limits of policies 
        under such program;
          (2) requiring such adjusters to attend State-
        sponsored mediation meetings regarding flood insurance 
        claims resulting from such catastrophe at times and 
        places as may be arranged by the State;
          (3) participating in good-faith negotiations toward 
        the settlement of such claims with policyholders of 
        coverage made available under the national flood 
        insurance program; and
          (4) finalizing the settlement of such claims on 
        behalf of the national flood insurance program with 
        such policyholders.
  (c) Coordination.--Representatives of the Director who 
participate pursuant to this section in a State-sponsored 
mediation program with respect to a natural catastrophe shall 
at all times coordinate their activities with insurance 
officials of the State and representatives of insurers for the 
purpose of consolidating and expediting the settlement of 
claims under the national flood insurance program resulting 
from such catastrophe at the earliest possible time.
  (d) Mediation Proceedings and Privileged Documents.--As a 
condition of the participation of Representatives of the 
Director pursuant to this section in State-sponsored mediation, 
all statements made and documents produced pursuant to such 
mediation involving representatives of the Director shall be 
deemed privileged and confidential settlement negotiations made 
in anticipation of litigation.
  (e) Effect of Participation on Liability, Right, and 
Obligations.--Participation of Representatives of the Director 
pursuant to this section in State-sponsored mediation shall not 
affect or expand the liability of any party in contract or in 
tort, nor shall it affect the rights or obligations of the 
parties as provided in the Standard Flood Insurance Policy 
under the national flood insurance program, regulations of the 
Federal Emergency Management Agency, this Act, or Federal 
common law.
  (f) Exclusive Federal Jurisdiction.--Participation of 
Representatives of the Director pursuant to this section in 
State-sponsored mediation shall not alter, change or modify the 
original exclusive jurisdiction of United States courts as 
provided in this Act.
  (g) Cost Limitation.--Nothing in this section shall be 
construed to require the Director or representatives of the 
Director to pay additional mediation fees relating to flood 
claims associated with a State-sponsored mediation program in 
which representatives of the Director participate.
  (h) Exception.--In the case of the occurrence of a natural 
catastrophe that results in flood damage claims under the 
national flood insurance program and does not result in any 
loss covered by a personal lines residential property insurance 
policy--
          (1) this section shall not apply; and
          (2) the provisions of the Standard Flood Insurance 
        Policy under the national flood insurance program and 
        the appeals process established pursuant to section 205 
        of the Bunning-Bereueter-Blumenauer Flood Insurance 
        Reform Act of 2004 (Public Law 108-264; 118 Stat. 726) 
        and regulations issued pursuant to such section shall 
        apply exclusively.
  (i) Representatives of Director.--For purposes of this 
section, the term ``representatives of the Director'' means 
representatives of the national flood insurance program who 
participate in the appeals process established pursuant to 
section 205 of the Bunning-Bereueter-Blumenauer Flood Insurance 
Reform Act of 2004 (Public Law 108-264; 118 Stat. 726) and 
regulations issued pursuant to such section.

SEC. 1326. GRANTS FOR OUTREACH TO PROPERTY OWNERS AND RENTERS.

  (a) In General.--The Director may, to the extent amounts are 
made available pursuant to subsection (h), make grants to local 
governmental agencies responsible for floodplain management 
activities (including such agencies of Indians tribes, as such 
term is defined in section 4 of the Native American Housing 
Assistance and Self-Determination Act of 1996 (25 U.S.C. 4103)) 
in communities that participate in the national flood insurance 
program under this title, for use by such agencies to carry out 
outreach activities to encourage and facilitate the purchase of 
flood insurance protection under this Act by owners and renters 
of properties in such communities and to promote educational 
activities that increase awareness of flood risk reduction.
  (b) Outreach Activities.--Amounts from a grant under this 
section shall be used only for activities designed to--
          (1) identify owners and renters of properties in 
        communities that participate in the national flood 
        insurance program, including owners of residential and 
        commercial properties;
          (2) notify such owners and renters when their 
        properties become included in, or when they are 
        excluded from, an area having special flood hazards and 
        the effect of such inclusion or exclusion on the 
        applicability of the mandatory flood insurance purchase 
        requirement under section 102 of the Flood Disaster 
        Protection Act of 1973 (42 U.S.C. 4012a) to such 
        properties;
          (3) educate such owners and renters regarding the 
        flood risk and reduction of this risk in their 
        community, including the continued flood risks to areas 
        that are no longer subject to the flood insurance 
        mandatory purchase requirement;
          (4) educate such owners and renters regarding the 
        benefits and costs of maintaining or acquiring flood 
        insurance, including, where applicable, lower-cost 
        preferred risk policies under this title for such 
        properties and the contents of such properties; and
          (5) encourage such owners and renters to maintain or 
        acquire such coverage.
  (c) Cost Sharing Requirement.--
          (1) In general.--In any fiscal year, the Director may 
        not provide a grant under this section to a local 
        governmental agency in an amount exceeding 3 times the 
        amount that the agency certifies, as the Director shall 
        require, that the agency will contribute from non-
        Federal funds to be used with grant amounts only for 
        carrying out activities described in subsection (b).
          (2) Non-federal funds.--For purposes of this 
        subsection, the term ``non-Federal funds'' includes 
        State or local government agency amounts, in-kind 
        contributions, any salary paid to staff to carry out 
        the eligible activities of the grant recipient, the 
        value of the time and services contributed by 
        volunteers to carry out such services (at a rate 
        determined by the Director), and the value of any 
        donated material or building and the value of any lease 
        on a building.
  (d) Administrative Cost Limitation.--Notwithstanding 
subsection (b), the Director may use not more than 5 percent of 
amounts made available under subsection (g) to cover salaries, 
expenses, and other administrative costs incurred by the 
Director in making grants and provide assistance under this 
section.
  (e) Application and Selection.--
          (1) In general.--The Director shall provide for local 
        governmental agencies described in subsection (a) to 
        submit applications for grants under this section and 
        for competitive selection, based on criteria 
        established by the Director, of agencies submitting 
        such applications to receive such grants.
          (2) Selection considerations.--In selecting 
        applications of local government agencies to receive 
        grants under paragraph (1), the Director shall 
        consider--
                  (A) the existence of a cooperative technical 
                partner agreement between the local 
                governmental agency and the Federal Emergency 
                Management Agency;
                  (B) the history of flood losses in the 
                relevant area that have occurred to properties, 
                both inside and outside the special flood 
                hazards zones, which are not covered by flood 
                insurance coverage;
                  (C) the estimated percentage of high-risk 
                properties located in the relevant area that 
                are not covered by flood insurance;
                  (D) demonstrated success of the local 
                governmental agency in generating voluntary 
                purchase of flood insurance; and
                  (E) demonstrated technical capacity of the 
                local governmental agency for outreach to 
                individual property owners.
  (f) Direct Outreach by FEMA.--In each fiscal year that 
amounts for grants are made available pursuant to subsection 
(h), the Director may use not more than 50 percent of such 
amounts to carry out, and to enter into contracts with other 
entities to carry out, activities described in subsection (b) 
in areas that the Director determines have the most immediate 
need for such activities.
  (g) Reporting.--Each local government agency that receives a 
grant under this section, and each entity that receives amounts 
pursuant to subsection (f), shall submit a report to the 
Director, not later than 12 months after such amounts are first 
received, which shall include such information as the Director 
considers appropriate to describe the activities conducted 
using such amounts and the effect of such activities on the 
retention or acquisition of flood insurance coverage.
  (h) Authorization of Appropriations.--There is authorized to 
be appropriated for grants under this section $50,000,000 for 
each of fiscal years 2008 through 2012.

           *       *       *       *       *       *       *

   CHAPTER III--COORDINATION OF FLOOD INSURANCE WITH LAND-MANAGEMENT 
                     PROGRAMS IN FLOOD-PRONE AREAS

                  IDENTIFICATION OF FLOOD-PRONE AREAS

  Sec. 1360. (a) * * *

           *       *       *       *       *       *       *

  (f) Updating Flood Maps.--The Director shall revise and 
update any floodplain areas and flood-risk zones--
          (1) * * *
          (2) upon the request from any State or local 
        government stating that specific floodplain areas or 
        flood-risk zones in the State or locality need revision 
        or updating, if sufficient technical data justifying 
        the request is submitted and the unit of government 
        making the request agrees to provide funds in an amount 
        determined by the Director, but which may not exceed 50 
        percent of the cost of carrying out the requested 
        revision or update, except that such a revision or 
        update shall be made at no cost to the unit of 
        government making the request if the request is being 
        made to reflect repairs and upgrades to dams, levees, 
        or other flood control projects under the jurisdiction 
        and responsibility of the Federal Government.

           *       *       *       *       *       *       *

  (k) Ongoing Program To Review, Update, and Maintain Flood 
Insurance Program Maps.--
          (1) In general.--The Director, in coordination with 
        the Technical Mapping Advisory Council established 
        pursuant to section 576 of the National Flood Insurance 
        Reform Act of 1994 (42 U.S.C. 4101 note) and section 
        22(b) of the Flood Insurance Reform and Modernization 
        Act of 2007, shall establish an ongoing program under 
        which the Director shall review, update, and maintain 
        national flood insurance program rate maps in 
        accordance with this subsection.
          (2) Inclusions.--
                  (A) Covered areas.--Each map updated under 
                this subsection shall include a depiction of--
                          (i) the 500-year floodplain;
                          (ii) areas that could be inundated as 
                        a result of the failure of a levee, as 
                        determined by the Director; and
                          (iii) areas that could be inundated 
                        as a result of the failure of a dam, as 
                        identified under the National Dam 
                        Safety Program Act (33 U.S.C. 467 et 
                        seq.).
                  (B) Other inclusions.--In updating maps under 
                this subsection, the Director may include--
                          (i) any relevant information on 
                        coastal inundation from--
                                  (I) an applicable inundation 
                                map of the Corps of Engineers; 
                                and
                                  (II) data of the National 
                                Oceanic and Atmospheric 
                                Administration relating to 
                                storm surge modeling;
                          (ii) any relevant information of the 
                        Geographical Service on stream flows, 
                        watershed characteristics, and 
                        topography that is useful in the 
                        identification of flood hazard areas, 
                        as determined by the Director; and
                          (iii) a description of any hazard 
                        that might impact flooding, including, 
                        as determined by the Director--
                                  (I) land subsidence and 
                                coastal erosion areas;
                                  (II) sediment flow areas;
                                  (III) mud flow areas;
                                  (IV) ice jam areas; and
                                  (V) areas on coasts and 
                                inland that are subject to the 
                                failure of structural 
                                protective works, such as 
                                levees, dams, and floodwalls.
          (3) Standards.--In updating and maintaining maps 
        under this subsection, the Director shall establish 
        standards to--
                  (A) ensure that maps are adequate for--
                          (i) flood risk determinations; and
                          (ii) use by State and local 
                        governments in managing development to 
                        reduce the risk of flooding;
                  (B) facilitate the Director, in conjunction 
                with State and local governments, to identify 
                and use consistent methods of data collection 
                and analysis in developing maps for communities 
                with similar flood risks, as determined by the 
                Director; and
                  (C) ensure that emerging weather forecasting 
                technology is used, where practicable, in flood 
                map evaluations and the identification of 
                potential risk areas.
          (4) Hurricanes katrina and rita mapping priority.--In 
        updating and maintaining maps under this subsection, 
        the Director shall--
                  (A) give priority to the updating and 
                maintenance of maps of coastal areas affected 
                by Hurricane Katrina or Hurricane Rita to 
                provide guidance with respect to hurricane 
                recovery efforts; and
                  (B) use the process of updating and 
                maintaining maps under subparagraph (A) as a 
                model for updating and maintaining other maps.
          (5) Preventing delay of 100-year maps.--In carrying 
        out this section and this subsection, the Director 
        shall take such actions as may be necessary to ensure 
        that updating and publication of national flood 
        insurance program rate maps to include a depiction of 
        the 500-year floodplain does not in any manner delay 
        the completion or publication of the program rate maps 
        for the 100-year floodplain.
          (6) Education program.--The Director shall, after 
        each update to a flood insurance program rate map, in 
        consultation with the chief executive officer of each 
        community affected by the update, conduct a program to 
        educate each such community about the update to the 
        flood insurance program rate map and the effects of the 
        update.
          (7) Annual report.--Not later than June 30 of each 
        year, the Director shall submit a report to the 
        Congress describing, for the preceding 12-month period, 
        the activities of the Director under the program under 
        this section and the reviews and updates of flood 
        insurance program rate maps conducted under the 
        program. Each such annual report shall contain the most 
        recent report of the Technical Mapping Advisory Council 
        pursuant to section 576(c)(3) of the National Flood 
        Insurance Reform Act of 1994 (42 U.S.C. 4101 note).
          (8) Authorization of appropriations.--There is 
        authorized to be appropriated to the Director to carry 
        out this subsection $400,000,000 for each of fiscal 
        years 2008 through 2013.
  (l) Interim Post-Disaster Flood Elevations.--
          (1) Authority.--Notwithstanding any other provision 
        of this section or section 1363, the Director may, 
        after any flood-related disaster, establish by order 
        interim flood elevation requirements for purposes of 
        the national flood insurance program for any areas 
        affected by such flood-related disaster.
          (2) Effectiveness.--Such interim elevation 
        requirements for such an area shall take effect 
        immediately upon issuance and may remain in effect 
        until the Director establishes new flood elevations for 
        such area in accordance with section 1363 or the 
        Director provides otherwise.

                  CRITERIA FOR LAND MANAGEMENT AND USE

  Sec. 1361. (a) * * *

           *       *       *       *       *       *       *

  (d) Windstorms.--
          (1) Studies and investigations.--The Director shall 
        carry out studies and investigations under this section 
        to determine appropriate measures in windstorm-prone 
        areas as to land management and use, windstorm zoning, 
        and windstorm damage prevention, and may enter into 
        contracts, agreements, and other appropriate 
        arrangements to carry out such activities. Such studies 
        and investigations shall include laws, regulations, and 
        ordinance relating to the orderly development and use 
        of areas subject to damage from windstorm risks, and 
        zoning building codes, building permits, and 
        subdivision and other building restrictions for such 
        areas.
          (2) Criteria.--On the basis of the studies and 
        investigations pursuant to paragraph (1) and such other 
        information as may be appropriate, the Direct shall 
        establish comprehensive criteria designed to encourage, 
        where necessary, the adoption of adequate State and 
        local measures which, to the maximum extent feasible, 
        will assist in reducing damage caused by windstorms.
          (3) Coordination with state and local governments.--
        The Director shall work closely with and provide any 
        necessary technical assistance to State, interstate, 
        and local governmental agencies, to encourage the 
        application of criteria established under paragraph (2) 
        and the adoption and enforcement of measures referred 
        to in such paragraph.

SEC. 1361A. PILOT PROGRAM FOR MITIGATION OF SEVERE REPETITIVE LOSS 
                    PROPERTIES.

  (a) * * *

           *       *       *       *       *       *       *

  (k) Funding.--
          (1) In general.--Pursuant to section 1310(a)(8), the 
        Director may use amounts from the National Flood 
        Insurance Fund to provide assistance under this section 
        in each of fiscal years [2005, 2006, 2007, 2008, and 
        2009] 2008, 2009, 2010, 2011, and 2012, except that the 
        amount so used in each such fiscal year may not exceed 
        $40,000,000 and shall remain available until expended. 
        Notwithstanding any other provision of this title, 
        amounts made available pursuant to this subsection 
        shall not be subject to offsetting collections through 
        premium rates for flood insurance coverage under this 
        title.

           *       *       *       *       *       *       *

  [(l) Termination.--The Director may not provide assistance 
under this section to any State or community after September 
30, 2009.]

           *       *       *       *       *       *       *

                                APPEALS

  [Sec. 1363. (a) In establishing projected flood elevations 
for land use purposes with respect to any community pursuant to 
section 1361, the Director shall first propose such 
determinations by publication for comment in the Federal 
Register, by direct notification to the chief executive officer 
of the community, and by publication in a prominent local 
newspaper.]
  Sec. 1363. (a) In establishing projected flood elevations for 
land use purposes with respect to any community pursuant to 
section 1361, the Director shall first propose such 
determinations--
          (1) by providing the chief executive officer of each 
        community affected by the proposed elevations, by 
        certified mail, with a return receipt requested, notice 
        of the elevations, including a copy of the maps for the 
        elevations for such community and a statement 
        explaining the process under this section to appeal for 
        changes in such elevations;
          (2) by causing notice of such elevations to be 
        published in the Federal Register, which notice shall 
        include information sufficient to identify the 
        elevation determinations and the communities affected, 
        information explaining how to obtain copies of the 
        elevations, and a statement explaining the process 
        under this section to appeal for changes in the 
        elevations; and
          (3) by publishing in a prominent local newspaper the 
        elevations, a description of the appeals process for 
        flood determinations, and the mailing address and 
        telephone number of a person the owner may contact for 
        more information or to initiate an appeal.

           *       *       *       *       *       *       *

                         MITIGATION ASSISTANCE

  Sec. 1366. (a)  * * *

           *       *       *       *       *       *       *

  (e) Eligible Mitigation Activities.--
          (1) * * *

           *       *       *       *       *       *       *

          (5) Eligible activities.--The Director shall 
        determine whether mitigation activities described in a 
        mitigation plan submitted under subsection (d) comply 
        with the requirements under paragraph (1). Such 
        activities may include--
                  (A) * * *
                  (B) elevation, relocation, demolition, [or 
                floodproofing] floodproofing, or demolition and 
                rebuilding of structures (including public 
                structures) located in areas having special 
                flood hazards or other areas of flood risk;

           *       *       *       *       *       *       *

  [(f) Limitations on Amount of Assistance.--
          [(1) Amount.--The sum of the amounts of mitigation 
        assistance provided under this section during any 5-
        year period may not exceed--
                  [(A) $10,000,000, to any State; or
                  [(B) $3,300,000, to any community.
          [(2) Geographic.--The sum of the amounts of 
        mitigation assistance provided under this section 
        during any 5-year period to any one State and all 
        communities located in such State may not exceed 
        $20,000,000.
          [(3) Waiver.--The Director may waive the dollar 
        amount limitations under paragraphs (1) and (2) for any 
        State or community for any 5-year period during which a 
        major disaster or emergency declared by the President 
        (pursuant to the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act) as a result of flood 
        conditions is in effect with respect to areas in the 
        State or community.]
  [(g)] (f) Matching Requirement.--
          (1) * * *

           *       *       *       *       *       *       *

  [(h)] (g) Oversight of Mitigation Plans.--The Director shall 
conduct oversight of recipients of mitigation assistance under 
this section to ensure that the assistance is used in 
compliance with the approved mitigation plans of the recipients 
and that matching funds certified under [subsection (g)] 
subsection (f) are used in accordance with such certification.
  [(i)] (h) Recapture.--
          (1) * * *
          (2) Failure to provide matching funds.--If the 
        Director determines that a State or community that has 
        received mitigation assistance under this section has 
        not provided matching funds in the amount certified 
        under [subsection (g)] subsection (f), the Director 
        shall recapture any unexpended amounts of mitigation 
        assistance exceeding 3 times the amount of such 
        matching funds actually provided and deposit the 
        amounts in the National Flood Mitigation Fund under 
        section 1367.
  [(j)] (i) Reports.--Not later than 1 year after the date of 
enactment of the Riegle Community Development and Regulatory 
Improvement Act of 1994 and biennially thereafter, the Director 
shall submit a report to the Congress describing the status of 
mitigation activities carried out with assistance provided 
under this section.
  [(k)] (j) Definition of Community.--For purposes of this 
section, the term ``community'' means--
          (1) * * *

           *       *       *       *       *       *       *

  [(m)] (k) Coordination With States and Communities.--The 
Director shall, in consultation and coordination with States 
and communities take such actions as are appropriate to 
encourage and improve participation in the national flood 
insurance program of owners of properties, including owners of 
properties that are not located in areas having special flood 
hazards (the 100-year floodplain), but are located within flood 
prone areas.

                     NATIONAL FLOOD MITIGATION FUND

  Sec. 1367. (a) Establishment and Availability.--The Director 
shall establish in the Treasury of the United States a fund to 
be known as the National Flood Mitigation Fund, which shall be 
credited with amounts described in subsection (b) and shall be 
available, to the extent provided in appropriation Acts, for 
providing assistance under section 1366. Notwithstanding any 
other provision of this title, amounts made available pursuant 
to this subsection shall not be subject to offsetting 
collections through premium rates for flood insurance coverage 
under this title.

           *       *       *       *       *       *       *

        CHAPTER IV--APPROPRIATIONS AND MISCELLANEOUS PROVISIONS

                              DEFINITIONS

  Sec. 1370. (a) As used in this title--
  (1) * * *

           *       *       *       *       *       *       *

  (14) the term ``servicer'' means the person responsible for 
receiving any scheduled periodic payments from a borrower 
pursuant to the terms of a loan, including amounts for taxes, 
insurance premiums, and other charges with respect to the 
property securing the loan, and making the payments of 
principal and interest and such other payments with respect to 
the amounts received from the borrower as may be required 
pursuant to the terms of the loan; [and]
  (15) the term ``substantially damaged structure'' means a 
structure covered by a contract for flood insurance that has 
incurred damage for which the cost of repair exceeds an amount 
specified in any regulation promulgated by the Director, or by 
a community ordinance, whichever is lower[.]; and
  (16) the term ``windstorm'' means any hurricane, tornado, 
cyclone, typhoon, or other wind event.

           *       *       *       *       *       *       *

                              ----------                              

                 FLOOD DISASTER PROTECTION ACT OF 1973

           *       *       *       *       *       *       *
TITLE I--EXPANSION OF NATIONAL FLOOD INSURANCE PROGRAM

           *       *       *       *       *       *       *

    FLOOD INSURANCE PURCHASE AND COMPLIANCE REQUIREMENTS AND ESCROW 
                                ACCOUNTS

  Sec. 102. (a) * * *

           *       *       *       *       *       *       *

  (f) Civil Monetary Penalties for Failure To Require Flood 
Insurance or Notify.--
          (1) * * *

           *       *       *       *       *       *       *

          (5) Amount.--A civil monetary penalty under this 
        subsection may not exceed [$350] $2,000 for each 
        violation under paragraph (2) or paragraph (3). The 
        total amount of penalties assessed under this 
        subsection against any single regulated lending 
        institution or enterprise during any calendar year may 
        not exceed [$100,000] $1,000,000; except that such 
        limitation shall not apply to a regulated lending 
        institution or enterprise for a calendar year if, in 
        any three (or more) of the five calendar years 
        immediately preceding such calendar year, the total 
        amount of penalties assessed under this subsection 
        against such lending institution or enterprise was 
        $1,000,000.
          (6) Lender compliance.--Notwithstanding any State or 
        local law, for purposes of this subsection, any 
        regulated lending institution that purchases flood 
        insurance or renews a contract for flood insurance on 
        behalf of or as an agent of a borrower of a loan for 
        which flood insurance is required shall be considered 
        to have complied with the regulations issued under 
        subsection (b). No penalty may be imposed under this 
        subsection on a regulated lending institution or 
        enterprise that has made a good faith effort to comply 
        with the requirements of the provisions referred to in 
        paragraph (2) or for any non-material violation of such 
        requirements.

           *       *       *       *       *       *       *

                              ----------                              

             REAL ESTATE SETTLEMENT PROCEDURES ACT OF 1974

           *       *       *       *       *       *       *
                      SPECIAL INFORMATION BOOKLETS

  Sec. 5. (a) * * *

           *       *       *       *       *       *       *

  (c) Each lender shall include with the booklet a good faith 
estimate of the amount or range of charges for specific 
settlement services the borrower is likely to incur in 
connection with the settlement as prescribed by the Secretary. 
Each such good faith estimate shall include the following 
conspicuous statements and information: (1) that flood 
insurance coverage for residential real estate is generally 
available under the national flood insurance program whether or 
not the real estate is located in an area having special flood 
hazards and that, to obtain such coverage, a home owner or 
purchaser should contact the national flood insurance program; 
(2) a telephone number and a location on the World Wide Web by 
which a home owner or purchaser can contact the national flood 
insurance program; and (3) that the escrowing of flood 
insurance payments is required for many loans under section 
102(d) of the Flood Disaster Protection Act of 1973, and may be 
a convenient and available option with respect to other loans.

           *       *       *       *       *       *       *

                              ----------                              

              NATIONAL FLOOD INSURANCE REFORM ACT OF 1994

           *       *       *       *       *       *       *
TITLE V--NATIONAL FLOOD INSURANCE REFORM

           *       *       *       *       *       *       *

Subtitle F--Miscellaneous Provisions

           *       *       *       *       *       *       *

SEC. 576. TECHNICAL MAPPING ADVISORY COUNCIL.

  (a) * * *
  (b) Membership.--
          (1) In general.--The Council shall consist of the 
        Director of the Federal Emergency Management Agency (in 
        this section referred to as the ``Director''), or the 
        Director's designee, and [10] 14 additional members to 
        be appointed by the Director or the designee of the 
        Director, who shall be--
                  (A) * * *

           *       *       *       *       *       *       *

                  (E) a representative of the Corps of 
                Engineers of the United States Army;
                  [(E)] (F) a representative of the United 
                States Geologic Survey;
                  [(F)] (G) a representative of State geologic 
                survey programs;
                  [(G)] (H) a representative of State national 
                flood insurance coordination offices;
                  (I) a representative of local or regional 
                flood and stormwater agencies;
                  (J) a representative of State geographic 
                information coordinators;
                  [(H)] (K) a representative of a regulated 
                lending institution;
                  (L) a representative of flood insurance 
                servicing companies;
                  (M) a real estate professional;
                  [(I)] (N) a representative of the Federal 
                Home Loan Mortgage Corporation; and
                  [(J)] (O) a representative of the Federal 
                National Mortgage Association.

           *       *       *       *       *       *       *

          (3) Terms of members.--
                  (A) In general.--Each member of the Council 
                pursuant to any of subparagraphs (B) through 
                (N) of paragraph (1) shall be appointed for a 
                term of 5 years, except as provided in 
                subparagraphs (B) and (C).
                  (B) Terms of initial appointees.--As 
                designated by the Director (or the designee of 
                the Director) at the time of appointment, of 
                the members of the Council first appointed 
                pursuant to subparagraph (D)--
                          (i) 4 shall be appointed for a term 
                        of 1 year;
                          (ii) 4 shall be appointed for a term 
                        of 3 years; and
                          (iii) 5 shall be appointed for a term 
                        of 5 years.
                  (C) Vacancies.--Any member of the Council 
                appointed to fill a vacancy occurring before 
                the expiration of the term for which the 
                member's predecessor was appointed shall be 
                appointed only for the remainder of that term. 
                A member may serve after the expiration of that 
                member's term until a successor has taken 
                office. A vacancy in the Council shall be 
                filled in the manner in which the original 
                appointment was made.
                  (D) Initial appointment.--The Director, or 
                the Director's designee, shall take action as 
                soon as possible after the date of the 
                enactment of the Flood Insurance Reform and 
                Modernization Act of 2007 to appoint the 
                members of the Council pursuant to this 
                subsection.
  [(c) Duties.--The Council shall--
          [(1) make recommendations to the Director on how to 
        improve in a cost-effective manner the accuracy, 
        general quality, ease of use, and distribution and 
        dissemination of flood insurance rate maps;
          [(2) recommend to the Director mapping standards and 
        guidelines for flood insurance rate maps; and
          [(3) submit an annual report to the Director that 
        contains--
                  [(A) a description of the activities of the 
                Council;
                  [(B) an evaluation of the status and 
                performance of flood insurance rate maps and 
                mapping activities to revise and update flood 
                insurance rate maps, as established pursuant to 
                the amendment made by section 675 ; and
                  [(C) a summary of recommendations made by the 
                Council to the Director.]
  (c) Duties.--The Council shall--
          (1) make recommendations to the Director for 
        improvements to the flood map modernization program 
        under section 1360(k) of the National Flood Insurance 
        Act of 1968 (42 U.S.C. 41010(k));
          (2) make recommendations to the Director for 
        maintaining a modernized inventory of flood hazard maps 
        and information; and
          (3) submit an annual report to the Director that 
        contains a description of the activities and 
        recommendations of the Council.

           *       *       *       *       *       *       *

  [(k) Termination.--The Council shall terminate 5 years after 
the date on which all members of the Council have been 
appointed under subsection (b)(1).]
  (k) Continued Existence.--Section 14(a)(2)(B) of the Federal 
Advisory Committee Act (5 U.S.C. App.; relating to termination 
of advisory committees) shall not apply to the Council.

           *       *       *       *       *       *       *

            ADDITIONAL VIEWS OF REPRESENTATIVE BARNEY FRANK

    As noted earlier in this report, this bill does not contain 
any congressional earmarks, limited tax benefits, or limited 
tariff benefits as defined in House rules. However, there are 
many other items that this bill does not contain as well. I am 
submitting a partial list for the edification of my colleagues:
    This bill does not ratify any treaties.
    This bill does not confirm any Supreme Court justices.
    This bill does not amend the Constitution.
                                                      Barney Frank.

                      ADDITIONAL REPUBLICAN VIEWS

    It is the view of the Republican Minority that the National 
Flood Insurance Program (NFIP) should be reformed and be made 
more actuarially sound before embarking on a massive expansion 
into the wind insurance business. While H.R. 3121, the ``Flood 
Insurance Reform and Modernization Act of 2007'' calls for 
several crucial reforms-including a phase-in of actuarially 
determined rates for some subsidized property owners-it also 
requires the NFIP to make wind coverage available to anyone 
purchasing flood insurance from the Federal government, in the 
form of a ``multiple-peril'' policy. The NFIP currently owes 
the Department of the Treasury around $18 billion, an amount it 
was forced to borrow to pay claims from the 2005 hurricane 
season. By its own account, it will likely never be able to 
repay this sum. The Minority believes that although Congress 
should continue to examine ways to encourage better access to 
homeowners' wind insurance, it would be ill-advised to force 
the NFIP to take on this new risk, as it could expose taxpayers 
to further loss and could unnecessarily interfere with the 
functioning of the private wind insurance market.
    H.R. 3121 and other catastrophe insurance proposals before 
the Committee seek to address, through Federal participation, a 
phenomenon of rising insurance costs in coastal areas at high 
risk of suffering hurricanes and other storms. Higher insurance 
prices can often be traced to a few causes, including increased 
risk (based on more frequent hurricanes, higher home values, 
and increased construction in coastal areas), hostile 
regulatory and legal climates, and temporary rate spikes 
following major catastrophes, when insurers remodel risk, 
rebuild surplus, and diversify exposure. H.R. 3121 would likely 
not address any of these factors, and while it may provide 
slightly more availability in the short-term, it could 
ultimately displace the private market in some regions, leading 
to fewer choices for consumers. Although it is questionable 
whether FEMA would be able to carry out this mandate, the NFIP 
multiple-peril product would be offered at ``actuarial'' rates, 
placing the coverage out of reach for the very constituents 
this bill is designed to help.
    At the July 17, 2007 legislative hearing on H.R. 3121, 
flood management groups, industry experts, the NAIC, 
environmental organizations, Treasury, and FEMA expressed 
concern over expanding the NFIP to include wind risks. These 
witnesses raised several questions about how the multiple-peril 
program would be implemented and administered, including how 
the new NFIP multiple-peril coverage would be priced, and how 
the NFIP would maintain actuarial soundness. The panel also 
expressed concern over the possibility that this bill could 
displace the private market, which generally offers wind 
coverage in most homeowners' insurance policies. Instead, the 
panel called for a comprehensive study addressing several 
issues, including determining what effects this massive 
expansion could have on the current program, how it would 
impact the availability and affordability of wind insurance, 
and how the NFIP would implement this mandate.
    In a June 2007 report, the Congressional Budget Office 
(CBO) reported that 47 percent of subsidized non-primary 
coastal homes and 37 percent of subsidized primary residences 
are worth at least $500,000. Further, close to 90 percent of 
the NFIP's Severe Repetitive Loss Properties (SRLPs) currently 
enjoy subsidized rates.The Republican Minority believes that 
the chief objective of the Committee and the Congress should be reform 
of the existing NFIP, including the removal of subsidies over time to 
improve the long-term solvency of the program. In contrast, H.R. 3121 
would dramatically increase the scope of the NFIP, at a time when the 
Government Accountability Office (GAO) includes the program on its 
``High Risk'' Series list, recommending increased oversight by 
Congress. While the Minority supports the vast majority of the 
provisions in H.R. 3121--which are similar to the bipartisan flood 
insurance reform bill introduced earlier this year (H.R. 1682), and the 
bipartisan bill that overwhelmingly passed the House last Congress 
(H.R. 4973)--the inclusion of wind coverage would likely exacerbate the 
NFIP's administrative problems.
    At the Committee's markup of H.R. 3121 Rep. Ginny Brown-
Waite (FL), along with Reps. Adam Putnam (FL) and Tom Feeney 
(FL), offered an amendment that would strike the mandate in 
H.R. 3121 requiring the NFIP to offer wind insurance and would 
replace it with a comprehensive GAO study. Unfortunately, the 
Majority rejected this common-sense amendment, which would 
require the GAO to examine a number of factors relating to the 
multiple-peril program proposed in H.R. 3121, including, among 
other things:
           The ability of the NFIP to timely implement 
        an actuarially-sound wind insurance program;
           The effects the expansion into wind 
        insurance could have on flood insurance reform, 
        including map modernization, and the phase-in of 
        actuarial rates;
           Whether an expansion of the NFIP to include 
        wind coverage could affect the availability and 
        affordability of such coverage, influence the private-
        sector development of multiple-peril products, or 
        result in adverse selection;
           Any potential taxpayer exposure the new 
        program could pose, similar to the deficit resulting 
        from the 2005 hurricane season;
           Available alternative methods that could 
        offer policyholders more options for wind coverage; and
           Coverage gaps that would remain under most 
        homeowners policies.
    Although this amendment was not accepted, a bipartisan 
study request letter has been transmitted to the GAO, requiring 
it to conduct a study on the issues outlined above. The 
Minority strongly urges the Committee to closely examine any 
GAO findings and recommendations resulting from this study and 
to seriously consider implementing them.
    Several other Republican amendments were adopted at 
Committee markup. Rep. Randy Neugebauer (TX) offered an 
amendment to require FEMA to study and report on the impact, 
effectiveness, and feasibility of including widely used 
building codes as part of the NFIP's floodplain management 
criteria. The Committee also accepted an amendment by Rep. 
Richard Baker (LA) that would delay the implementation of 
Section 7, which creates the NFIP multiple-peril product, until 
June 30, 2008, so that the GAO can study the impact of this 
provision, in accordance with the bipartisan request. An 
amendment by Rep. Jeb Hensarling (TX) was approved that would 
require FEMA to report to Congress regarding how it plans to 
repay, within 10 years, its debt to Treasury. Rep. Tom Price 
(GA) offered an amendment to eliminate the requirement that an 
additional, one-page description of the NFIP coverage be 
distributed to policyholders, instead requiring the more 
comprehensive supplemental forms already mandated by the 
Bunning-Bereuter Blumenauer Flood Insurance Reform Act of 2004. 
Finally, Rep. Patrick McHenry (NC) offered an amendment that 
would suspend FEMA's ability to offer new multiple-peril 
policies if the NFIP is forced to borrow from the Treasury to 
pay multiple-peril claims.
    Despite these improvements and the continuing need for 
flood insurance reform, nearly all Committee Republicans were 
unable to support this legislation, because of the significant 
new taxpayer liabilities it creates. The Eastern Seaboard and 
Gulf Coast contain more than $19 trillion of insured value. 
Shifting even a portion of this risk to the troubled NFIP could 
expose taxpayers to massive losses. H.R. 3121 could also result 
in significant adverse selection for the multiple-peril 
program. Because wind is a standard component of homeowners 
insurance, the risk from a government-backed wind product would 
likely be concentrated in regions where wind coverage is the 
most difficult to obtain in the private market. Another large 
hurricane or storm in the Gulf region that causes both flood 
and wind losses could bankrupt the NFIP by several times its 
current insolvency. The Minority believes that, at the very 
least, this proposal, as well as others, should be thoroughly 
studied before being authorized by Congress. In addition to a 
GAO study, Committee Republicans support efforts by the Senate 
Banking Committee to create an independent natural catastrophe 
insurance commission to study and report on legislative and 
regulatory changes to improve the availability and 
competitiveness of disaster insurance.

                                   Spencer Bachus.
                                   Frank D. Lucas.
                                   Donald A. Manzullo.
                                   Geoff Davis.
                                   Scott Garrett.
                                   Adam H. Putnam.
                                   Kenny Marchant.
                                   Jeb Hensarling.
                                   Tom Feeney.
                                   Randy Neugebauer.
                                   Peter J. Roskam.
                                   Tom Price.
                                   Gary G. Miller.
                                   Ed Royce.
                                   Ron Paul.
                                   Christopher Shays.
                                   Judy Biggert.

                                  
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