I

103D CONGRESS

1ST SESSION H. R. 62

To revise the national flood insurance program to provide for mitigation

insurance coverage and claims payments to reduce damages to structures

suffering severe or repetitive flooding or subject to shoreline erosion,

to promote compliance with requirements for mandatory purchase of

flood insurance, and for other purposes.

IN THE HOUSE OF REPRESENTATIVES

JANUARY 5, 1993

Mr. BEREUTER introduced the following bill; which was referred to the

Committee on Banking, Finance and Urban Affairs

SEPTEMBER 14, 1993

Additional sponsors: Ms. KAPTUR, Mr. DE LUGO, and Mr. CASTLE

A BILL

To revise the national flood insurance program to provide

for mitigation insurance coverage and claims payments

to reduce damages to structures suffering severe or repetitive flooding or subject to shoreline erosion, to promote compliance with requirements for mandatory purchase of flood insurance, and for other purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

2 (a) SHORT TITLE.—This Act may be cited as the

3 ‘‘National Flood Insurance Compliance, Mitigation, and

4 Erosion Management Act of 1993’’.

5 (b) TABLE OF CONTENTS.—

Sec. 1. Short title and table of contents.

Sec. 2. Congressional findings.

Sec. 3. Declaration of purpose under the National Flood Insurance Act of

1968.

TITLE I—DEFINITIONS

Sec. 101. Flood Disaster Protection Act of 1973.

Sec. 102. National flood insurance act of 1968.

TITLE II—COMPLIANCE AND INCREASED PARTICIPATION

Sec. 201. Existing flood insurance purchase requirements.

Sec. 202. Expanded flood insurance purchase requirements.

Sec. 203. Escrow of flood insurance payments.

Sec. 204. Fine for failure to require flood insurance or notify.

Sec. 205. Ongoing compliance with flood insurance purchase requirements.

Sec. 206. Notice requirements.

Sec. 207. Standard hazard determination forms.

Sec. 208. Financial Institutions Examination Council.

Sec. 209. Conforming amendment.

TITLE III—RATINGS AND INCENTIVES FOR COMMUNITY

FLOODPLAIN MANAGEMENT PROGRAMS

Sec. 301. Community rating system and incentives for community floodplain

management.

Sec. 302. Funding.

TITLE IV—MITIGATION OF FLOOD AND EROSION RISKS

Sec. 401. Repeal of flooded property purchase and loan program.

Sec. 402. Termination of erosion-threatened structures program.

Sec. 403. Flood and erosion damage mitigation insurance.

Sec. 404. Limitations on flood insurance coverage in areas of extreme erosion

risk.

Sec. 405. Modification of floodplain management provisions.

Sec. 406. Riverine erosion study.

TITLE V—FLOOD INSURANCE TASK FORCE

Sec. 501. Flood Insurance Interagency Task Force.

TITLE VI—MISCELLANEOUS PROVISIONS

Sec. 601. Maximum flood insurance coverage amounts.
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Sec. 602. Flood insurance program arrangements with private insurance entities.

Sec. 603. Updating of flood maps and assessment and mapping of erosion hazard zones.

Sec. 604. Funding for increased administrative and operational responsibilities.

Sec. 605. Regulations.

1 SEC. 2. CONGRESSIONAL FINDINGS.

2 The Congress finds that—

3 (1) with respect to flood damage, a structured

4 prefunded insurance program is preferable to a re5 sponse based on post-disaster relief;

6 (2) the Federal Government and State and local

7 governments must work together to successfully

8 carry out the national flood insurance program;

9 (3) a Federal flood insurance program that

10 combines predisaster mitigation efforts together with

11 an insurance and compliance program will reduce

12 the physical and economic effects of flood damage on

13 the Federal Government, State, and local govern14 ments, and individuals;

15 (4) the national flood insurance program and

16 the citizens of the United States have benefited from

17 a low incidence of major storms and hurricanes in

18 recent years;

19 (5) the present reserve in the national flood in20 surance program of nearly $400,000,000 remains

21 extremely vulnerable to another major storm causing

22 billions of dollars in damage claims, which could de-
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1 plete the national flood insurance fund, exacerbate

2 the Federal budget deficit, and threaten the safety

3 and soundness of financing institutions holding un4 insured mortgages on properties in flood-prone

5 areas;

6 (6) only 1,700,000 of an estimated 11,000,000

7 households in special flood hazard areas are pro8 tected by flood insurance;

9 (7) the number of properties insured against

10 floods remained roughly constant during the 1980’s

11 despite continuing growth in real estate activity in

12 coastal, lakeshore, and riverine areas;

13 (8) requiring flood insurance coverage for struc14 tures subject to private mortgages (in addition to

15 those subject to federally related mortgages) will re16 sult in a more comprehensive flood-risk insurance

17 program;

18 (9) the floodplain management and land use

19 and control measures adopted by communities par20 ticipating in the national flood insurance program

21 have resulted in lower claims for structures con22 structed in compliance with such measures;

23 (10) the national flood insurance program

24 should require and provide for notification regarding

25 flood insurance purchase requirements under the
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1 program to homeowners, mortgage lenders, and

2 mortgage servicers;

3 (11) lending to aid development of areas within

4 the Coastal Barrier Resources System is inherently

5 risky and can affect the financial condition of feder6 ally insured financial institutions;

7 (12) the Federal regulatory agencies for deposi8 tory and nondepository institutions should, in the

9 course of examinations of institutions, pay particular

10 attention to the quality of loans that would aid the

11 development of coastal barriers within the Coastal

12 Barrier Resources System;

13 (13) incentives in the form of reduced premium

14 rates for flood insurance under the national flood in15 surance program should be provided in communities

16 that have adopted and enforced exemplary or par17 ticularly effective measures for floodplain manage18 ment;

19 (14) a community-based approach to mitigation

20 and erosion management, to reduce losses in

21 floodplains, is the most comprehensive, effective, and

22 cost-efficient method of minimizing losses in

23 floodplains and reducing disaster assistance expendi24 tures;
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1 (15) such community-based mitigation and loss

2 prevention methods should be incorporated in the

3 national flood insurance program;

4 (16) unprecedented growth in population and

5 development has occurred along coasts and rivers of

6 the United States and it is estimated that a signifi7 cant portion of the United States population is ex8 posed to the hazard of floods, flooding disasters, and

9 erosion damage;

10 (17) repeat claims, which involve about 2 per11 cent of total insured properties, account for 32 per12 cent of the total losses from the flood insurance

13 fund, amounting to over $1,000,000,000 since Janu14 ary 1978;

15 (18) no comprehensive Federal program exists

16 to evaluate and provide technical assistance and

17 funds for the mitigation of damages to repetitively

18 and severely damaged structures or insured struc19 tures threatened by shoreline erosion, and such a

20 program would reduce the vulnerability of the Fed21 eral Government to flood losses;

22 (19) no comprehensive Federal program exists

23 to assist in the removal of structures out of high

24 risk areas, such as regulatory floodways and coastal

25 high hazard zones, before disaster strikes;
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1 (20) flood and erosion hazards can be signifi2 cantly reduced by deterring development in wetlands

3 and open-space and recreational areas;

4 (21) gradual, long-term retreat of portions of

5 the Nation’s coastline and the resulting inland ad6 vancement of flood hazards is increasing the expo7 sure of insured structures to flood damages;

8 (22) a comprehensive coastal erosion manage9 ment program can provide a variety of mitigation al10 ternatives to reduce erosion losses to existing struc11 tures and protect new structures from erosion losses,

12 thereby reducing Federal expenditures due to ero13 sion;

14 (23) since enactment in 1988, section 1306(c)

15 of the National Flood Insurance Act of 1968 has not

16 functioned as envisioned or intended and has re17 sulted in a preference for demolition of buildings

18 subject to erosion damages, which is more costly

19 than relocating structures;

20 (24) there has been a recognized need for the

21 Federal Emergency Management Agency to formally

22 assess, on an ongoing basis, the accuracy of flood

23 hazard maps for communities, thereby ensuring that

24 maps are updated and revised in a timely fashion as

25 needed;
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1 (25) the level of flood insurance coverage that

2 an individual can purchase has not been increased

3 since 1977;

4 (26) due to substantial increases in construc5 tion costs, many property owners are prevented from

6 purchasing flood insurance for the replacement value

7 of the building, potentially resulting in an owner not

8 receiving a payment to fully restore flood-damaged

9 property; and

10 (27) wise use of the floodplain minimizes ad11 verse impacts upon the natural and beneficial func12 tions of the floodplain, such as moderation of flood13 ing, retention of floodwaters, reduction of erosion

14 and sedimentation, preservation of water quality,

15 groundwater recharge, and provision of fisheries and

16 wildlife habitat.

17 SEC. 3. DECLARATION OF PURPOSE UNDER THE NATIONAL

18 FLOOD INSURANCE ACT OF 1968.

19 Section 1302(e) of the National Flood Insurance Act

20 of 1968 (42 U.S.C. 4001(e)) is amended—

21 (1) by redesignating clauses (3), (4), and (5),

22 as clauses (4), (5), and (6), respectively; and

23 (2) by inserting after the comma at the end of

24 clause (2) the following: ‘‘(3) encourage State and

25 local governments to protect natural and beneficial
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1 floodplain functions that reduce flood-related

2 losses,’’.

3 TITLE I—DEFINITIONS

4 SEC. 101. FLOOD DISASTER PROTECTION ACT OF 1973.

5 (a) IN GENERAL.—Section 3(a) of the Flood Disaster

6 Protection Act of 1973 (42 U.S.C. 4003(a)) is amended—

7 (1) by striking paragraph (5) and inserting the

8 following new paragraph:

9 ‘‘(5) ‘Federal entity for lending regulation’

10 means the Board of Governors of the Federal Re11 serve System, the Federal Deposit Insurance Cor12 poration, the Comptroller of the Currency, the Office

13 of Thrift Supervision, and the National Credit

14 Union Administration, and with respect to a particu15 lar regulated lending institution means the entity

16 primarily responsible for the supervision, approval,

17 or regulation of the institution;’’;

18 (2) in paragraph (6), by striking the period at

19 the end and inserting a semicolon; and

20 (3) by inserting after paragraph (6) the follow21 ing new paragraphs:

22 ‘‘(7) ‘lender’ includes any regulated lending in23 stitution, other lending institution, and Federal

24 agency (to the extent the agency makes direct loans

25 subject to the provisions of this Act), but does not
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1 include any agency engaged primarily in the pur2 chase of mortgage loans;

3 ‘‘(8) ‘other lending institution’ means any lend4 ing institution that is not subject to the supervision,

5 approval, regulation, or insuring of any Federal en6 tity for lending regulation and that is not a Federal

7 agency, but does not include institutions engaged

8 primarily in the purchase of mortgage loans; and

9 ‘‘(9) ‘regulated lending institution’ means any

10 bank, savings and loan association, credit union, or

11 similar institution subject to the supervision, ap12 proval, regulation, or insuring of a Federal entity for

13 lending regulation.’’.

14 (b) CONFORMING AMENDMENTS.—

15 (1) REQUIREMENTS TO PURCHASE FLOOD IN16 SURANCE.—Section 102(b) of the Flood Disaster

17 Protection Act of 1973 (42 U.S.C. 4012a(b)) is

18 amended by striking ‘‘Each Federal instrumentality

19 responsible for the supervision, approval, regulation,

20 or insuring of banks, savings and loan associations,

21 or similar institutions shall by regulation direct such

22 institutions’’ and inserting ‘‘Each Federal entity for

23 lending regulation shall by regulation direct regu24 lated lending institutions’’.
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1 (2) EFFECT OF NONPARTICIPATION IN FLOOD

2 INSURANCE PROGRAM.—Section 202(b) of the Flood

3 Disaster Protection Act of 1973 (42 U.S.C.

4 4106(b)) is amended by striking ‘‘Federal instru5 mentality described in such section shall by regula6 tion require the institutions’’ and inserting ‘‘Federal

7 entity for lending regulation (with respect to regu8 lated lending institutions), the Secretary of Housing

9 and Urban Development (with respect to other lend10 ing institutions), and the appropriate head of each

11 Federal agency acting as a lender, shall by regula12 tion require the lenders’’.

13 SEC. 102. NATIONAL FLOOD INSURANCE ACT OF 1968.

14 (a) IN GENERAL.—Section 1370(a) of the National

15 Flood Insurance Act of 1968 (42 U.S.C. 4121(a)) is

16 amended—

17 (1) in paragraph (5), by striking ‘‘and’’ at the

18 end;

19 (2) in paragraph (6), by striking the period at

20 the end and inserting a semicolon; and

21 (3) by inserting after paragraph (6) the follow22 ing new paragraphs:

23 ‘‘(7) the term ‘coastal’ means relating to the

24 coastlines and bays of the tidal waters of the United

25 States or the shorelines of the Great Lakes, but does
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1 not refer to bayous, riverine areas, and riverine por2 tions of estuaries;

3 ‘‘(8) the term ‘Federal entity for lending regu4 lation’ means the Board of Governors of the Federal

5 Reserve System, the Federal Deposit Insurance Cor6 poration, the Comptroller of the Currency, the Office

7 of Thrift Supervision, and the National Credit

8 Union Administration, and with respect to a particu9 lar regulated lending institution means the entity

10 primarily responsible for the supervision, approval,

11 or regulation of the institution;

12 ‘‘(9) the term ‘lender’ includes any regulated

13 lending institution, other lending institution, and

14 Federal agency (to the extent the agency makes di15 rect loans subject to the provisions of this Act), but

16 does not include any agency engaged primarily in

17 the purchase of mortgage loans;

18 ‘‘(10) the term ‘natural and beneficial flood19 plain functions’ means (A) the functions associated

20 with the natural or relatively undisturbed floodplain

21 that moderate flooding, retain flood waters, or re22 duce erosion and sedimentation, and (B) ancillary

23 beneficial functions, including maintenance of water

24 quality, recharge of ground water, and provision of

25 fisheries and wildlife habitat;
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1 ‘‘(11) the term ‘regulated lending institution’

2 means a bank, savings and loan association, credit

3 union, or similar institution subject to the super4 vision, approval, regulation, or insuring of a Federal

5 entity for lending regulation;

6 ‘‘(12) the term ‘other lending institution’ means

7 any lending institution that is not subject to the su8 pervision, approval, regulation, or insuring of any

9 Federal entity for lending regulation and that is not

10 a Federal agency, but does not include institutions

11 engaged primarily in the purchase of mortgage

12 loans; and’’.

13 (b) CONFORMING AMENDMENT.—Section 1322(d) of

14 the National Flood Insurance Act of 1968 (42 U.S.C.

15 4029(d)) is amended by striking ‘‘federally supervised, ap16 proved, regulated, or insured financial institution’’ and in17 serting ‘‘regulated lending institution’’.

18 TITLE II—COMPLIANCE AND

19 INCREASED PARTICIPATION

20 SEC. 201. EXISTING FLOOD INSURANCE PURCHASE RE21 QUIREMENTS.

22 Section 102(a) of the Flood Disaster Protection Act

23 of 1973 (42 U.S.C. 4012a(a)) is amended—

24 (1) by inserting ‘‘(1)’’ after ‘‘(a)’’; and
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1 (2) by adding at the end the following new

2 paragraph:

3 ‘‘(2) Paragraph (1) may not be construed to permit

4 the provision of any amount of financial assistance with

5 respect to any building or mobile home and related per6 sonal property for which flood insurance is required under

7 such paragraph, unless the requirements under such para8 graph are complied with in full. The prohibitions and re9 quirements under paragraph (1) relating to financial as10 sistance may not be waived for any purpose.’’.

11 SEC. 202. EXPANDED FLOOD INSURANCE PURCHASE RE12 QUIREMENTS.

13 (a) IN GENERAL.—Section 102(b) of the Flood Dis14 aster Protection Act of 1973 (42 U.S.C. 4012a(b)), as

15 amended by the preceding provisions of this Act, is further

16 amended—

17 (1) by inserting ‘‘(1)’’ after ‘‘(b)’’;

18 (2) by inserting ‘‘(after consultation and coordi19 nation with the Financial Institutions Examination

20 Council established under the Federal Financial In21 stitutions Examination Council Act of 1974)’’ before

22 ‘‘shall by regulation’’; and

23 (3) by adding at the end the following new

24 paragraphs:
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1 ‘‘(2) The Secretary of Housing and Urban Develop2 ment (after consultation and coordination with the Finan3 cial Institutions Examination Council) shall by regulation

4 direct that any other lending institution may not make,

5 increase, extend, or renew any loan secured by improved

6 real estate or a mobile home located or to be located in

7 an area that has been identified by the Director of the

8 Federal Emergency Management Agency as an area hav9 ing special flood hazards and in which flood insurance has

10 been made available under the National Flood Insurance

11 Act of 1968, unless the building or mobile home and any

12 personal property securing such loan is covered for the

13 term of the loan by flood insurance in the amount provided

14 in paragraph (1).

15 ‘‘(3) A Federal agency may not make, increase, ex16 tend, or renew any loan secured by improved real estate

17 or a mobile home located or to be located in an area that

18 has been identified by the Director of the Federal Emer19 gency Management Agency as an area having special flood

20 hazards and in which flood insurance has been made avail21 able under the National Flood Insurance Act of 1968, un22 less the building or mobile home and any personal prop23 erty securing such loan is covered for the term of the loan

24 by flood insurance in the amount provided in paragraph

25 (1). The relevant head of each Federal agency acting as
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1 a lender shall issue any regulations necessary to carry out

2 this paragraph. Such regulations shall be consistent with

3 and substantially identical to the regulations issued under

4 paragraphs (1) and (2).

5 ‘‘(4) Notwithstanding any other Federal or State law,

6 any lender may charge the borrower a reasonable fee (as

7 determined by the Director) for the costs of determining

8 whether the improved real estate or mobile home securing

9 the loan is located in an area of special flood hazards, but

10 only if such determination is made pursuant to the mak11 ing, increasing, extending, or renewing of a loan described

12 under paragraph (1), (2), or (3) that is initiated by the

13 borrower.

14 ‘‘(5) If a borrower under a loan disputes or challenges

15 the determination of the lender that the improved real es16 tate or mobile home securing the loan is located in an area

17 of special flood hazards, the lender shall review and con18 sider any relevant information submitted to the lender by

19 the borrower.’’.

20 (b) APPLICABILITY.—The amendment made by sub21 section (a)(3) shall apply only with respect to—

22 (1) any loan made, increased, extended, or re23 newed after the expiration of the 1-year period be24 ginning on the date of the enactment of this Act;

25 and
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1 (2) any loan outstanding after the expiration of

2 the 5-year period beginning on the date of the enact3 ment of this Act.

4 SEC. 203. ESCROW OF FLOOD INSURANCE PAYMENTS.

5 (a) IN GENERAL.—Section 102 of the Flood Disaster

6 Protection Act of 1973 (42 U.S.C. 4012a) is amended by

7 adding at the end the following new subsection:

8 ‘‘(d)(1) For loans secured by residential real estate,

9 each Federal entity for lending regulation (with respect

10 to any loans of regulated lending institutions) and the Sec11 retary of Housing and Urban Development (with respect

12 to any loans of other lending institutions), after consulta13 tion and coordination with the Financial Institutions Ex14 amination Council, shall by regulation direct that, if the

15 lender or other servicer of the loan requires the escrowing

16 of taxes, insurance premiums, or any other charges with

17 respect to property secured under residential real estate

18 loans, then any premiums and fees for flood insurance

19 under the National Flood Insurance Act of 1968 for the

20 residential real estate shall be paid to the lender or

21 servicer of the loan. Premiums and fees paid to the lender

22 or servicer shall be paid in a manner sufficient to make

23 payments as due for the duration of the loan. Upon receipt

24 of the premiums, the lender or servicer of the loan shall

25 deposit the premiums in an escrow account on behalf of
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1 the borrower. Upon receipt of a notice from the Director

2 or the provider of the insurance that insurance premiums

3 are due, the lender or servicer shall pay from the escrow

4 account to the provider of the insurance the amount of

5 insurance premiums owed.

6 ‘‘(2) The appropriate head of each Federal agency

7 acting as a lender shall by regulation require and provide

8 for escrow and payment of any flood insurance premiums

9 and fees relating to residential property securing loans

10 made by the agency under the circumstances and in the

11 manner provided under paragraph (1). Any regulations is12 sued under this paragraph shall be consistent with and

13 substantially identical to the regulations issued under

14 paragraph (1).

15 ‘‘(3) Escrow accounts established pursuant to this

16 subsection shall be subject to the provisions of section 10

17 of the Real Estate Settlement Procedures Act of 1974.

18 ‘‘(4)(A) Notwithstanding any State or local law, the

19 Federal entities for lending regulation, the Secretary of

20 Housing and Urban Development (after consultation and

21 coordination with the Financial Institutions Examination

22 Council), and the appropriate heads of Federal agencies

23 acting as lenders shall by regulation direct that any lender

24 who purchases flood insurance or renews a contract for

25 flood insurance on behalf of or as an agent of a borrower
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1 of a loan secured by residential real estate for which (i)

2 flood insurance is required, and (ii) an escrow account for

3 payment of taxes, insurance premiums, or other charges

4 has not been established, shall provide to the borrower

5 written notice of the purchase or renewal (as the Director

6 determines appropriate) on at least 2 separate occasions

7 before the purchase or renewal.

8 ‘‘(B) The notice under this paragraph shall contain

9 the following information:

10 ‘‘(i) A statement that the lender will purchase

11 or renew the flood insurance on behalf of or as an

12 agent of the borrower.

13 ‘‘(ii) The date on which such purchase or re14 newal will occur.

15 ‘‘(iii) The cost of the insurance coverage as pur16 chased or renewed by the lender.

17 ‘‘(iv) A statement that the borrower may avoid

18 the purchase or renewal by the lender by purchasing

19 flood insurance coverage under the national flood in20 surance program or from private insurers.

21 ‘‘(v) Any other information that the Director

22 considers appropriate.’’.

23 (b) APPLICABILITY.—The amendment made by sub24 section (a) shall apply with respect to—
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1 (1) any loan made, increased, extended, or re2 newed after the expiration of the 1-year period be3 ginning on the date of the enactment of this Act;

4 and

5 (2) any loan outstanding after the expiration of

6 the 5-year period beginning on the date of the enact7 ment of this Act.

8 SEC. 204. FINE FOR FAILURE TO REQUIRE FLOOD INSUR9 ANCE OR NOTIFY.

10 Section 102 of the Flood Disaster Protection Act of

11 1973 (42 U.S.C. 4012a), as amended by the preceding

12 provisions of this Act, is further amended by adding at

13 the end the following new subsection:

14 ‘‘(e)(1) Any regulated or other lending institution

15 that is found to have a pattern or practice of committing

16 violations under paragraph (2) shall be assessed a civil

17 penalty by the appropriate Federal entity for lending regu18 lation (with respect to regulated lending institutions) or

19 the Secretary of Housing and Urban Development (with

20 respect to any other lending institutions) of not more than

21 $350 for each such violation. A penalty under this sub22 section may be issued only after notice and an opportunity

23 for a hearing on the record.

24 ‘‘(2) The violations referred to in paragraph (1) shall

25 be—
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1 ‘‘(A) after the date of the enactment of the Na2 tional Flood Insurance Compliance, Mitigation, and

3 Erosion Management Act of 1993, making, increas4 ing, extending, or renewing a loan in violation of es5 crow requirements under subsection (d) of this sec6 tion; and

7 ‘‘(B) with respect to any loan made, increased,

8 extended or renewed after the expiration of the 1-

9 year period beginning on such date of enactment

10 and any loan outstanding after the expiration of the

11 5-year period beginning on such date of enactment,

12 making, increasing, extending, or renewing any such

13 loan in violation of the regulations issued pursuant

14 to subsection (b) of this section or the notice re15 quirements under section 1364 of the National

16 Flood Insurance Act of 1968.

17 ‘‘(3) The total amount of penalties assessed under

18 this subsection against any single lender for any calendar

19 year may not exceed $100,000.

20 ‘‘(4) Notwithstanding any State or local law, for pur21 poses of this subsection, any lender that purchases flood

22 insurance or renews a contract for flood insurance on be23 half of or as an agent of a borrower of a loan for which

24 flood insurance is required shall be considered to have

25 complied with the regulations issued under subsection (b).
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1 ‘‘(5) Any sale or other transfer of a loan by a lender

2 who has committed a violation under paragraph (1), that

3 occurs subsequent to the violation, shall not affect the li4 ability of the transferring lender with respect to any pen5 alty under this subsection. A lender shall not be liable for

6 any violations relating to a loan committed by another

7 lender who previously held the loan.

8 ‘‘(6) Any penalties collected under this subsection

9 shall be paid into the National Flood Insurance Fund es10 tablished under section 1310 of the National Flood Insur11 ance Act of 1968.

12 ‘‘(7) Any penalty under this subsection shall be in

13 addition to any civil remedy or criminal penalty otherwise

14 available.

15 ‘‘(8) No penalty may be imposed under this sub16 section for any violation under paragraph (1) after the ex17 piration of the 5-year period beginning on the date of the

18 occurrence of the violation.’’.

19 SEC. 205. ONGOING COMPLIANCE WITH FLOOD INSURANCE

20 PURCHASE REQUIREMENTS.

21 (a) IN GENERAL.—Section 102 of the Flood Disaster

22 Protection Act of 1973 (42 U.S.C. 4012a), as amended

23 by the preceding provisions of this Act, is further amended

24 by adding at the end the following new subsection:
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1 ‘‘(f)(1) Except as provided in paragraphs (2), (3),

2 and (4), before the sale or transfer of any loan secured

3 by improved real estate or a mobile home, the seller or

4 transferor of the loan shall determine whether the prop5 erty is in an area that has been designated by the Director

6 as an area having special flood hazards. The seller or

7 transferor shall, before sale or transfer, notify the pur8 chaser or transferee and any servicer of the loan in writing

9 regarding the results of the determination. A determina10 tion under this paragraph shall be evidenced using the

11 standard hazard determination form under section 1365

12 of the National Flood Insurance Act of 1968.

13 ‘‘(2) For any loan secured by improved real estate

14 or a mobile home, a determination and notice under para15 graph (1) shall not be required if, during the 5-year period

16 ending on the date of the sale or transfer of the loan—

17 ‘‘(A) a determination and notice under para18 graph (1) has been made for the property secured by

19 the loan; or

20 ‘‘(B)(i) the loan has been made, increased, ex21 tended, or renewed; and

22 ‘‘(ii) the lender making, increasing, extending,

23 or renewing the loan was subject, at the time of such

24 transaction, to regulations issued pursuant to para25 graph (1), (2), or (3) of subsection (b).
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1 ‘‘(3)(A) For any loan secured by improved real estate

2 or a mobile home that is sold or transferred by the Federal

3 Deposit Insurance Corporation acting in its corporate ca4 pacity or in its capacity as conservator or receiver, the

5 purchaser or transferee of the loan shall determine wheth6 er the property is in an area that has been designated

7 by the Director as an area having special flood hazards.

8 ‘‘(B) Such determination and notice shall not be re9 quired for any loan—

10 ‘‘(i) sold or transferred to an entity under the

11 control of the Federal Deposit Insurance Corpora12 tion; or

13 ‘‘(ii) for which the purchaser or transferee exer14 cises any available option to transfer or put the loan

15 back to the Federal Deposit Insurance Corporation.

16 ‘‘(C) A purchaser or transferee of a loan required to

17 make a determination and notification under subpara18 graph (A) shall notify the Director and any servicer of

19 the loan of the results of the determination (using the

20 standard hazard determination form under section 1365

21 of the National Flood Insurance Act of 1968) before the

22 expiration of the 90-day period beginning on the later of

23 (i) the purchase or transfer of the loan, or (ii) the expira24 tion of any option that the purchaser or transferee may
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1 have to transfer or put the loan back to the Federal De2 posit Insurance Corporation.

3 ‘‘(4)(A) For any loan secured by improved real estate

4 or a mobile home that is sold or transferred by the Resolu5 tion Trust Corporation acting in its corporate capacity or

6 in its capacity as a conservator or receiver, the purchaser

7 or transferee of the loan shall determine whether the prop8 erty is in an area that has been designated by the Director

9 as an area having special flood hazards if—

10 ‘‘(i) the Resolution Trust Corporation acquires

11 the loan after the date of the effectiveness of this

12 subsection and sells or transfers the loan before the

13 expiration of the 12-month period beginning on such

14 effective date; or

15 ‘‘(ii) the Corporation holds the loan on the date

16 of the effectiveness of this subsection and sells or

17 transfers the loan before the expiration of the 6-

18 month period beginning on such effective date.

19 ‘‘(B) A purchaser or transferee of a loan required to

20 make a determination and notification under subpara21 graph (A) shall notify the Director and any servicer of

22 the loan of the results of the determination (using the

23 standard hazard determination form under section 1365

24 of the National Flood Insurance Act of 1968) before the
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1 expiration of the 90-day period beginning upon the pur2 chase or transfer of the loan.’’.

3 (b) APPLICABILITY.—The amendment made by sub4 section (a) shall apply with respect to any loan outstand5 ing or entered into after the expiration of the 1-year pe6 riod beginning on the date of the enactment of this Act.

7 SEC. 206. NOTICE REQUIREMENTS.

8 Section 1364 of the National Flood Insurance Act of

9 1968 (42 U.S.C. 4104a) is amended to read as follows:

10 ‘‘NOTICE REQUIREMENTS

11 ‘‘SEC. 1364. (a) NOTIFICATION OF SPECIAL FLOOD

12 HAZARDS.—

13 ‘‘(1) LENDING INSTITUTIONS.—Each Federal

14 entity for lending regulation (with respect to regu15 lated lending institutions) and the Secretary of

16 Housing and Urban Development (with respect to

17 other lending institutions), after consultation and co18 ordination with the Financial Institutions Examina19 tion Council, shall by regulation require such institu20 tions, as a condition of making, increasing, extend21 ing, or renewing any loan secured by improved real

22 estate or a mobile home located or to be located in

23 an area that has been identified by the Director

24 under this title or the Flood Disaster Protection Act

25 of 1973 as an area having special flood hazards, to

26 notify the purchaser or lessee (or obtain satisfactory
27

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1 assurances that the seller or lessor has notified the

2 purchaser or lessee) and the servicer of the loan of

3 such special flood hazards, in writing, a reasonable

4 period in advance of the signing of the purchase

5 agreement, lease, or other documents involved in the

6 transaction. The regulations shall also require that

7 the lenders retain a record of the receipt of the no8 tices by the purchaser or lessee and the servicer.

9 ‘‘(2) FEDERAL AGENCIES AS LENDERS.—The

10 appropriate head of each Federal agency acting as

11 a lender shall by regulation require notification in

12 the manner provided under paragraph (1) with re13 spect to any loan that is made by the agency and

14 secured by improved real estate or a mobile home lo15 cated or to be located in an area that has been iden16 tified by the Director under this title or the Flood

17 Disaster Protection Act of 1973 as an area having

18 special flood hazards. Any regulations issued under

19 this paragraph shall be consistent with and substan20 tially identical to the regulations issued under para21 graph (1).

22 ‘‘(3) CONTENTS OF NOTICE.—Written notifica23 tion required under this subsection shall include—

24 ‘‘(A) a warning, in a form to be established

25 in consultation with and subject to the approval
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1 of the Director, stating that the real estate or

2 mobile home securing the loan is located or is

3 to be located in an area having special flood

4 hazards;

5 ‘‘(B) a description of the flood insurance

6 purchase requirements under section 102(b) of

7 the Flood Disaster Protection Act of 1973;

8 ‘‘(C) a statement that flood insurance cov9 erage may be purchased under the national

10 flood insurance program and is also available

11 from private insurers; and

12 ‘‘(D) any other information that the Direc13 tor considers necessary to carry out the pur14 poses of the national flood insurance program.

15 ‘‘(b) NOTIFICATION OF CHANGE OF LOAN HOLDER

16 AND SERVICER.—

17 ‘‘(1) LENDING INSTITUTIONS.—Each Federal

18 entity for lending regulation (with respect to regu19 lated lending institutions) and the Secretary of

20 Housing and Urban Development (with respect to

21 other lending institutions), after consultation and co22 ordination with the Financial Institutions Examina23 tion Council, shall by regulation require such institu24 tions, as a condition of making, increasing, extend25 ing, renewing, selling, or transferring any loan de-
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•HR 62 SC

1 scribed in subsection (a)(1), to notify the Director

2 (or the designee of the Director) in writing during

3 the term of the loan of the owner and servicer of the

4 loan. Such institutions shall also notify the Director

5 (or such designee) of any change in the owner or

6 servicer of the loan, not later than 60 days after the

7 effective date of such change. The regulations under

8 this subsection shall provide that upon any sale or

9 transfer of a loan, the duty to provide notification

10 under this subsection shall transfer to the transferee

11 of the loan.

12 ‘‘(2) FEDERAL AGENCIES AS LENDERS.—The

13 appropriate head of each Federal agency acting as

14 a lender shall by regulation provide for notification

15 in the manner provided under paragraph (1) with

16 respect to any loan described in subsection (a)(1)

17 that is made by the agency. Any regulations issued

18 under this paragraph shall be consistent with and

19 substantially identical to the regulations issued

20 under paragraph (1) of this subsection.

21 ‘‘(c) NOTIFICATION OF EXPIRATION OF INSUR22 ANCE.—The Director (or the designee of the Director)

23 shall, not less than 45 days before the expiration of any

24 contract for flood insurance under this title, issue notice

25 of such expiration by first class mail to the owner of the
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1 property, the servicer of any loan secured by the property

2 covered by the contract, and the owner of the loan.’’.

3 SEC. 207. STANDARD HAZARD DETERMINATION FORMS.

4 Chapter III of the National Flood Insurance Act of

5 1968 (42 U.S.C. 4101 et seq.) is amended by adding at

6 the end the following new section:

7 ‘‘STANDARD HAZARD DETERMINATION FORMS

8 ‘‘SEC. 1365. (a) DEVELOPMENT.—The Director, in

9 consultation with representatives of the mortgage and

10 lending industry, the Federal entities for lending regula11 tion, the Federal agencies acting as lenders, and any other

12 appropriate individuals, shall develop standard written

13 and electronic forms for applications relating to real estate

14 loans and mortgages for determining flood hazard expo15 sure of a property.

16 ‘‘(b) DESIGN AND CONTENTS.—

17 ‘‘(1) PURPOSE.—The form under subsection (a)

18 shall be designed to facilitate a determination of the

19 exposure to flood hazards of structures located on

20 the property to which the loan application relates.

21 The form shall be consistent with and appropriate to

22 facilitate compliance with the provisions of this title.

23 ‘‘(2) CONTENTS.—The form shall require iden24 tification of the type of flood-risk zone in which the

25 property is located, the complete map and panel

26 numbers for the property, and the date of the map
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1 used for the determination, with respect to flood

2 hazard information on file with the Director. If the

3 property is not located in an area of special flood

4 hazard the form shall require a statement to such

5 effect and shall indicate the complete map and panel

6 numbers of the property. If the complete map and

7 panel numbers for the property are not available be8 cause the property is not located in a community

9 that is participating in the national flood insurance

10 program or because no map exists for the relevant

11 area, the form shall require a statement to such ef12 fect. The form shall provide for inclusion or attach13 ment of any relevant documents indicating revisions

14 or amendments to maps.

15 ‘‘(c) REQUIRED USE.—The Federal entities for lend16 ing regulation shall by regulation require the use of the

17 form under this section by regulated lending institutions.

18 The appropriate head of each Federal agency acting as

19 a lender shall by regulation provide for the use of the form

20 with respect to any loan made by such agency. The Fed21 eral National Mortgage Association and the Federal Home

22 Loan Mortgage Corporation shall by regulation require

23 use of the form in connection with loans purchased by

24 such corporations. The Secretary of Housing and Urban
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•HR 62 SC

1 Development shall encourage the use of the form by other

2 lending institutions.

3 ‘‘(d) GUARANTEES REGARDING INFORMATION.—In

4 providing information regarding special flood hazards on

5 the form developed under this section (or otherwise re6 quired of a lender not required to use the form under this

7 section) any lender making, increasing, extending, or re8 newing a loan secured by improved real estate or a mobile

9 home may provide for the acquisition or determination of

10 such information to be made by a person other than such

11 institution, only to the extent such person guarantees the

12 accuracy of the information. The Director shall by regula13 tions establish requirements relating to the nature and

14 manner of such guarantees.

15 ‘‘(e) ELECTRONIC FORM.—The Federal entities for

16 lending regulation, the Secretary of Housing and Urban

17 Development, and the appropriate head of each Federal

18 agency acting as a lender shall by regulation require any

19 lender using the electronic form developed under this sec20 tion with respect to any loan to make available upon the

21 request of such Federal entity, Secretary, or agency head,

22 a written form under this section for such loan within 48

23 hours after such request.’’.
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1 SEC. 208. FINANCIAL INSTITUTIONS EXAMINATION COUN2 CIL.

3 Section 1006 of the Federal Financial Institutions

4 Examination Council Act of 1978 (12 U.S.C. 3305) is

5 amended by adding at the end the following new sub6 section:

7 ‘‘(g) The council shall consult and assist the Federal

8 entities for lending regulation and the Secretary of Hous9 ing and Urban Development in developing and coordinat10 ing uniform standards and requirements for use by lenders

11 as provided under the National Flood Insurance Act of

12 1968 and the Flood Disaster Protection Act of 1973.’’.

13 SEC. 209. CONFORMING AMENDMENT.

14 The section heading for section 102 of the Flood Dis15 aster Protection Act of 1973 (42 U.S.C. 4012a) is amend16 ed to read as follows:
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1 ‘‘FLOOD INSURANCE PURCHASE AND COMPLIANCE

2 REQUIREMENTS AND ESCROW ACCOUNTS’’.

3 TITLE III—RATINGS AND INCEN4 TIVES FOR COMMUNITY

5 FLOODPLAIN MANAGEMENT

6 PROGRAMS

7 SEC. 301. COMMUNITY RATING SYSTEM AND INCENTIVES

8 FOR COMMUNITY FLOODPLAIN MANAGE9 MENT.

10 Section 1315 of the National Flood Insurance Act of

11 1968 (42 U.S.C. 4022) is amended—

12 (1) by inserting after ‘‘SEC. 1315.’’ the follow13 ing: ‘‘(a) REQUIREMENT FOR PARTICIPATION IN

14 FLOOD INSURANCE PROGRAM.—’’; and

15 (2) by adding at the end the following new sub16 section:

17 ‘‘(b) COMMUNITY RATING SYSTEM AND INCENTIVES

18 FOR COMMUNITY FLOODPLAIN MANAGEMENT.—

19 ‘‘(1) AUTHORITY AND GOALS.—The Director

20 shall carry out a community rating system program

21 to evaluate the measures adopted by areas (and sub22 divisions thereof) in which the Director has made

23 flood insurance coverage available to provide for ade24 quate land use and control provisions consistent with

25 the comprehensive criteria for such land manage-
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•HR 62 SC

1 ment and use under section 1361, to facilitate accu2 rate risk-rating, to promote flood insurance aware3 ness, and to complement adoption of more effective

4 measures for floodplain and coastal erosion manage5 ment.

6 ‘‘(2) INCENTIVES.—The program under this

7 subsection shall provide incentives in the form of ad8 justments in the premium rates for flood insurance

9 coverage in areas that the Director determines have

10 adopted and enforced the goals of the community

11 rating system under this subsection. In providing in12 centives under this paragraph, the Director may pro13 vide for additional adjustments in premium rates for

14 flood insurance coverage in areas that the Director

15 determines have implemented measures relating to

16 the protection of natural and beneficial floodplain

17 functions.

18 ‘‘(3) FUNDS.—The Director shall carry out the

19 program under this subsection with amounts, as the

20 Director determines necessary, from the National

21 Flood Insurance Fund under section 1310 and any

22 other amounts that may be appropriated for such

23 purpose.

24 ‘‘(4) REPORTS.—The Director shall submit a

25 report to the Congress regarding the program under
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1 this subsection not later than the expiration of the

2 2-year period beginning on the date of the enact3 ment of the National Flood Insurance Compliance,

4 Mitigation, and Erosion Management Act of 1993.

5 The Director shall submit a report under this para6 graph not less than every 2 years thereafter. Each

7 report under this paragraph shall include an analysis

8 of the cost-effectiveness and other accomplishments

9 and shortcomings of the program and any rec10 ommendations of the Director for legislation regard11 ing the program.’’.

12 SEC. 302. FUNDING.

13 Section 1310(a) of the National Flood Insurance Act

14 of 1968 (42 U.S.C. 4017(a)) is amended—

15 (1) in paragraph (4), by striking ‘‘and’’ at the

16 end;

17 (2) in paragraph (5), by striking the period at

18 the end and inserting a semicolon; and

19 (3) by inserting after paragraph (5) the follow20 ing new paragraph:

21 ‘‘(6) for carrying out the program under section

22 1315(b);’’.
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1 TITLE IV—MITIGATION OF

2 FLOOD AND EROSION RISKS

3 SEC. 401. REPEAL OF FLOODED PROPERTY PURCHASE AND

4 LOAN PROGRAM.

5 (a) REPEAL.—Section 1362 of the National Flood In6 surance Act of 1968 (42 U.S.C. 4103) is repealed.

7 (b) TRANSITION PHASE.—Notwithstanding sub8 section (a), during the period beginning on the date of

9 the enactment of this Act and ending on the date that

10 flood and erosion mitigation insurance is first made gen11 erally available under section 1306a of the National Flood

12 Insurance Act of 1968, the Director of the Federal Emer13 gency Management Agency may enter into loan and pur14 chase commitments as provided under section 1362 of

15 such Act (as in effect immediately before the enactment

16 of this Act).

17 (c) SAVINGS PROVISION.—Notwithstanding sub18 section (a), the Director shall take any action necessary

19 to comply with any purchase or loan commitment entered

20 into before the expiration of the period referred to in sub21 section (b) pursuant to authority under section 1362 of

22 the National Flood Insurance Act of 1968 or subsection

23 (b).
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1 SEC. 402. TERMINATION OF EROSION-THREATENED STRUC2 TURES PROGRAM.

3 (a) IN GENERAL.—Section 1306 of the National

4 Flood Insurance Act of 1968 (42 U.S.C. 4013) is amended

5 by striking subsection (c).

6 (b) TRANSITION PHASE.—Notwithstanding sub7 section (a), during the period beginning on the date of

8 the enactment of this Act and ending on the date that

9 flood and erosion mitigation insurance is first made gen10 erally available under section 1306a of the National Flood

11 Insurance Act of 1968, the Director of the Federal Emer12 gency Management Agency may pay amounts under flood

13 insurance contracts for demolition or relocation of struc14 tures as provided in section 1306(c) of the National Flood

15 Insurance Act of 1968 (as in effect immediately before the

16 enactment of this Act).

17 (c) SAVINGS PROVISION.—Notwithstanding sub18 section (a), the Director shall take any action necessary

19 to make payments under flood insurance contracts pursu20 ant to any commitments made before the expiration of the

21 period referred to in subsection (b) pursuant to the au22 thority under section 1306(c) of the National Flood Insur23 ance Act of 1968 or subsection (b).
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1 SEC. 403. FLOOD AND EROSION DAMAGE MITIGATION IN2 SURANCE.

3 (a) IN GENERAL.—The National Flood Insurance

4 Act of 1968 (42 U.S.C. 4001 et seq.) is amended by in5 serting after section 1306 the following new section:

6 ‘‘FLOOD AND EROSION MITIGATION INSURANCE

7 COVERAGE

8 ‘‘SEC. 1306a. (a) IN GENERAL.—The Director shall

9 provide, under the flood insurance program under this

10 title, for mitigation insurance under this section to reduce

11 damage and losses from future floods to structures located

12 in special flood hazard areas and other areas and to pre13 vent damages to structures located along shorelines that

14 are subject to erosion.

15 ‘‘(b) SEPARATE CONTRACT AND PREMIUMS.—The

16 Director shall make flood and erosion mitigation insurance

17 available as provided under this section and as a supple18 ment to or under a separate contract for flood insurance

19 coverage under this title, and shall provide for the estab20 lishment and payment of separate premiums under sub21 section (i) and separate claims under this section for such

22 mitigation insurance.

23 ‘‘(c) COMMUNITY ELIGIBILITY REQUIREMENTS FOR

24 EROSION MITIGATION COVERAGE.—Mitigation insurance

25 claim payments for the purposes of relocating or demolish26 ing structures subject to imminent erosion damage under
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1 subsection (f)(2)(C) may not be provided under this sec2 tion unless an appropriate public body shall have adopted

3 erosion management measures that contain the following

4 requirements:

5 ‘‘(1) PROHIBITION OF CONSTRUCTION IN 30-

6 YEAR EROSION SETBACK AREAS.—New or substan7 tially improved construction (as defined by the Di8 rector) shall not be permitted within the 30-year

9 erosion setback determined by the Director under

10 section 1360(g).

11 ‘‘(2) LIMITED CONSTRUCTION IN 60-YEAR ERO12 SION SETBACK AREAS.—Only readily movable new

13 and substantially improved construction that con14 sists of 1 to 4 dwelling units, and structures relo15 cated pursuant to subsection (h)(1)(A)(i) shall be

16 permitted within the 60-year erosion setback deter17 mined by the Director under section 1360(g).

18 ‘‘(d) AVAILABLE AND REQUIRED COVERAGE.—

19 ‘‘(1) REQUIRED COVERAGE.—Each Federal in20 strumentality responsible for the supervision, ap21 proval, regulation, or insuring of banks, savings and

22 loan associations, or similar institutions shall by reg23 ulation direct such institutions not to make, in24 crease, extend, or renew, after the expiration of the

25 1-year period beginning on the date of the enact-
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1 ment of the National Flood Insurance Compliance,

2 Mitigation, and Erosion Management Act of 1993,

3 any loan secured by improved real estate or a mobile

4 home described in this paragraph, unless the build5 ing or mobile home and any personal property secur6 ing such loan is covered for the term of the loan by

7 mitigation insurance under this section at a rate de8 termined necessary by the Director. Mitigation in9 surance shall be required under this paragraph for

10 any property—

11 ‘‘(A) located in an area of special flood

12 hazards on which a structure was constructed

13 before the adoption of a flood insurance rate

14 map under section 1360(a)(2) by the relevant

15 community participating in the flood insurance

16 program under this title; or

17 ‘‘(B) located in an erosion hazard zone (as

18 determined by the Director under section

19 1360(g)) along the shoreline of the Great Lakes

20 or the tidal waters of the United States, in a

21 community that has adopted adequate erosion

22 management measures under subsection (c) of

23 this section.

24 ‘‘(2) AVAILABLE COVERAGE.—The Director

25 may make available mitigation insurance for any
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1 property not required to be covered under paragraph

2 (1) that is—

3 ‘‘(A) located in an area of special flood

4 hazards on which a structure was constructed

5 or substantially improved after the adoption of

6 a flood insurance rate map under section

7 1360(a)(2) by the relevant community partici8 pating in the flood insurance program under

9 this title; or

10 ‘‘(B) not located in an area of special flood

11 hazards.

12 ‘‘(3) EROSION HAZARD ZONE SURCHARGE.—

13 The Director shall assess surcharges under sub14 section (i)(2) on the flood insurance contracts for

15 any structure located along the shoreline of the

16 Great Lakes or the coastline of the tidal waters of

17 the United States in an erosion hazard zone (as de18 termined by the Director under section 1360(g)) if

19 the structure is located in a community that has not

20 adopted the erosion management measures under

21 subsection (c) of this section.

22 ‘‘(4) CERTIFICATION OF EROSION DANGER.—

23 The Director shall provide for determination and

24 certification under subsection (f)(2)(C)(i) of struc25 tures subject to imminent danger of collapse or sub-
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1 sidence located in communities that have not adopt2 ed the erosion management measures under sub3 section (c).

4 ‘‘(e) ELIGIBLE STRUCTURES.—A contract for mitiga5 tion insurance under this section shall provide for payment

6 of a claim only for structures that, at the time of the event

7 for which the claim is made, have been continuously cov8 ered by both flood and mitigation insurance as follows:

9 ‘‘(1) 5-YEAR FLOOD INSURANCE COVERAGE.—

10 The structure shall have been covered by a contract

11 for flood insurance under this title for the shorter

12 of—

13 ‘‘(A) the 5-year period ending on the date

14 of the event for which the claim is made; or

15 ‘‘(B) the period beginning on the date of

16 purchase of the structure by the owner making

17 the claim.

18 ‘‘(2) 5-YEAR MITIGATION INSURANCE COV19 ERAGE.—The structure shall have been covered by a

20 contract for mitigation insurance under this section

21 for the shorter of—

22 ‘‘(A) the 5-year period ending on the date

23 of the event for which the claim is made;
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1 ‘‘(B) the period beginning on the date of

2 the availability of mitigation insurance under

3 this section; or

4 ‘‘(C) the period beginning on the date of

5 purchase of the structure by the owner making

6 the claim.

7 ‘‘(f) ELIGIBLE DAMAGE AND MITIGATION CLAIMS.—

8 A contract for mitigation insurance under this section

9 shall provide for payment of a claim for mitigation activi10 ties under subsection (g) or (h) only for structures eligible

11 under subsection (e) that suffer any of the following dam12 age or imminent damage:

13 ‘‘(1) FLOOD DAMAGE.—The structure shall

14 have—

15 ‘‘(A) incurred flood damage on not less

16 than 2 previous occasions (including the event

17 for which the claim is made) during the 5-year

18 period ending on the date of the event for which

19 the claim is made, the damage for which on av20 erage is greater than 25 percent of the value of

21 the structure (as determined by the Director ac22 cording to the procedure under subsection

23 (h)(2)(A)); or
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1 ‘‘(B) incurred substantial flood damage (as

2 such term is defined by the Director) as a re3 sult of the event for which the claim is made.

4 ‘‘(2) IMMINENT EROSION DAMAGE.—The struc5 ture shall be—

6 ‘‘(A) located on land that is along the

7 shoreline of the Great Lakes or the tidal waters

8 of the United States, in an erosion hazard zone

9 determined by the Director under section

10 1360(g);

11 ‘‘(B) located in a community that has

12 adopted the erosion management measures

13 under subsection (c); and

14 ‘‘(C) subject to imminent danger of col15 lapse or subsidence as a result of erosion or un16 dermining caused by waves, currents of water,

17 or bluff recession, as—

18 ‘‘(i) certified by the Director or the

19 appropriate Federal, State, or local author20 ity (as the Director shall determine); or

21 ‘‘(ii) condemned by the appropriate

22 State or local authority.

23 ‘‘(g) CLAIMS FOR REPETITIVE OR SUBSTANTIAL

24 FLOOD DAMAGE.—Claims under a contract for mitigation
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1 insurance for flood damage described under subsection

2 (f)(1) shall be subject to the following requirements:

3 ‘‘(1) USE OF PAYMENT AMOUNTS.—Any

4 amounts received for payment of a claim under such

5 subsection may be used only as follows:

6 ‘‘(A) MITIGATION ACTIVITIES.—For activi7 ties to demolish, relocate, elevate, or floodproof

8 a structure, as the Director shall determine

9 after evaluating—

10 ‘‘(i) the extent of damage;

11 ‘‘(ii) the physical characteristics of the

12 structure;

13 ‘‘(iii) the severity of the 100-year fre14 quency flood at the site of the structure;

15 and

16 ‘‘(iv) any applicable State and local

17 regulations and codes.

18 ‘‘(B) COST EFFECTIVENESS.—For activi19 ties that are the most cost-effective and tech20 nically feasible, in the determination of the Di21 rector, with respect to affording the structure

22 protection from the 100-year frequency flood

23 and enabling the structure to comply with the

24 land use and control measures adopted by the

25 community under section 1315(a), except that
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1 if no cost-effective or technically feasible activi2 ties are available, the Director may, on a case3 by-case basis, consider and permit use of such

4 amounts for alternative activities that do not

5 fully enable a structure to comply with such

6 standards.

7 ‘‘(C) REQUIRED USE OF SUBSTANTIAL

8 FLOOD DAMAGE PAYMENT AMOUNTS.—If re9 ceived for payment of a claim for substantial

10 flood damage described under subparagraph

11 (B) of subsection (f)(1), the payment shall be

12 used as provided under this paragraph for ac13 tivities that afford the structure protection from

14 the 100-year frequency flood and enable the

15 structure to comply with the land use and con16 trol measures adopted by the community under

17 section 1315(a).

18 ‘‘(2) EFFECT OF PAYMENT OF CLAIM.—

19 ‘‘(A) COMPLIANCE WITH FLOODPLAIN

20 MANAGEMENT MEASURES.—For any structure

21 for which a payment is to be made on a claim

22 under a contract for mitigation insurance for

23 flood damage described under subparagraph (A)

24 or (B) of subsection (f)(1) for the purpose of

25 affording the structure protection from the 100-
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1 year frequency flood and enabling the structure

2 to comply with the land use and control meas3 ures adopted by the community under section

4 1315(a)—

5 ‘‘(i) upon the first renewal of the

6 flood insurance contract for such property

7 occurring after the payment of such claim,

8 the Director shall provide for premium

9 rates for flood insurance for such structure

10 based only on the risk involved and sound

11 actuarial principles; and

12 ‘‘(ii) notwithstanding subsection

13 (d)(1), upon the completion of mitigation

14 activities, the provisions of such subsection

15 requiring the purchase of mitigation insur16 ance shall not apply.

17 ‘‘(B) NONCOMPLIANCE WITH FLOODPLAIN

18 MANAGEMENT MEASURES.—For any structure

19 for which a payment is made on a claim under

20 a contract for mitigation insurance for repet21 itive flood damage described under subsection

22 (f)(1)(A) for the purpose of conducting

23 floodproofing and other activities that do not

24 afford the structure protection from the 100-

25 year frequency flood nor enable the structure to
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1 comply with the land use and control measures

2 adopted by the community under section

3 1315(a)—

4 ‘‘(i) the Director shall continue to

5 provide for premium rates for flood insur6 ance for such structure based on the proce7 dure otherwise generally used by the Direc8 tor for determining such rate;

9 ‘‘(ii) the Director shall continue to re10 quire the purchase of mitigation insurance

11 under subsection (d)(1), but shall provide

12 for discounted premium rates for such

13 mitigation insurance under subsection

14 (i)(3)(C)(ii) at a rate that reflects the risk

15 of future mitigation insurance payments

16 for flood claims for substantial damage

17 under subsection (f)(1)(B); and

18 ‘‘(iii) the Director shall provide for an

19 increase in the minimum deductible for

20 flood insurance for such structure based on

21 the level of protection against flood dam22 age afforded the structure by such activi23 ties.

24 ‘‘(3) EFFECT OF NONPAYMENT OF REPETITIVE

25 DAMAGE CLAIM.—With respect to any structure for
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1 which a payment is not made for a claim under a

2 contract for mitigation insurance for repetitive flood

3 damage described under subsection (f)(1)(A) because

4 of the unavailability of a cost-effective alternative

5 under paragraph (1)(B) of this subsection—

6 ‘‘(A) the Director shall continue to provide

7 for premium rates for flood insurance for such

8 structure based on the procedure generally used

9 by the Director for determining such rate;

10 ‘‘(B) the Director shall provide for an in11 crease in the minimum deductible for flood in12 surance and provide for further increases in the

13 deductible upon any further payments of claims

14 under the flood insurance contract for such

15 structure; and

16 ‘‘(C) the Director shall continue to require

17 the purchase of mitigation insurance under sub18 section (d)(1), and shall provide for premium

19 rates under subsection (i) that reflect the pay20 ment of possible future mitigation insurance

21 claims under subsection (f)(1)(B).

22 ‘‘(4) PROCEDURE FOR PAYMENT OF MITIGA23 TION CLAIMS.—The Director shall establish proce24 dures for—
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1 ‘‘(A) issuance of payment of claims for

2 mitigation activities under this subsection in in3 crements based on the percentage of the mitiga4 tion activity completed; and

5 ‘‘(B) on-site and other verification of the

6 percentage of the mitigation activity completed.

7 ‘‘(h) CLAIMS FOR IMMINENT EROSION DAMAGE.—

8 Claims under a contract for mitigation insurance for im9 minent erosion damage described under subsection (f)(2)

10 shall be subject to the following requirements:

11 ‘‘(1) USE OF PAYMENT AMOUNTS.—Any

12 amounts received for payment of a claim under such

13 subsection may be used only as follows:

14 ‘‘(A) RELOCATION ACTIVITIES.—For ac15 tivities to relocate the structure—

16 ‘‘(i) landward of the 30-year erosion

17 setback established under section

18 1360(g)(3), if the structure is a readily

19 movable structure consisting of 1 to 4

20 dwelling units; and

21 ‘‘(ii) landward of the 60-year erosion

22 setback established under section

23 1360(g)(2), if the structure is any other

24 type of movable structure.
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1 ‘‘(B) DEMOLITION ACTIVITIES.—For ac2 tivities to demolish the structure if—

3 ‘‘(i) the remaining portion of the lot

4 or parcel of property on which the struc5 ture is located is inadequate to accommo6 date the relocation of the structure in con7 formance with subparagraph (A) and no

8 alternative location exists for relocation of

9 the structure that (in the determination of

10 the Director) would be cost-effective;

11 ‘‘(ii) the cost of relocating the struc12 ture is greater than the value of the struc13 ture as determined under the procedure

14 under paragraph (2)(A); or

15 ‘‘(iii) the structure is not of such

16 structural soundness (in the determination

17 of the Director) to permit relocation in a

18 safe manner.

19 ‘‘(2) AMOUNT OF CLAIM PAYMENT.—The Direc20 tor shall pay claims for imminent erosion damage

21 described under subsection (f)(2) that the Director

22 determines are in compliance with regulations issued

23 pursuant to subsection (k) in the following amounts:

24 ‘‘(A) RELOCATION CLAIMS.—For reloca25 tion of a structure under paragraph (1)(A), an
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1 amount not to exceed 40 percent of the value

2 of the structure, as the Director shall determine

3 according to the lesser of—

4 ‘‘(i) the fair market value of a com5 parable structure not subject to imminent

6 collapse or subsidence;

7 ‘‘(ii) the price paid for the structure

8 and any improvement to the structure, as

9 adjusted for inflation in accordance with

10 an index determined by the Director to be

11 appropriate; or

12 ‘‘(iii) the value of the structure under

13 the flood insurance contract issued pursu14 ant to this title.

15 ‘‘(B) DEMOLITION CLAIMS.—For demoli16 tion of a structure under paragraph (1)(B)—

17 ‘‘(i) following final determination that

18 the requirements of paragraph (1)(B) have

19 been met, an amount equal to 40 percent

20 of the value of the structure as determined

21 under the procedure under subparagraph

22 (A); and

23 ‘‘(ii) following demolition of the struc24 ture (including any septic containment sys25 tem) prior to collapse, the remaining 60
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1 percent of the value of the structure and

2 10 percent of the value of the structure, or

3 the actual cost of demolition, whichever is

4 less.

5 ‘‘(3) CLAIM PAYMENT AND COVERAGE LIMITA6 TION REGARDING MITIGATION ACTIVITIES.—With re7 spect to any structure covered by mitigation insur8 ance that is eligible for a claim for imminent erosion

9 damage described under subsection (f)(2), after the

10 expiration of the 2-year period beginning on the date

11 of the certification or condemnation of the structure

12 under subparagraph (C) of such subsection, the Di13 rector—

14 ‘‘(A) may not pay any amounts for reloca15 tion or demolition activities;

16 ‘‘(B) shall provide for the cancellation of

17 the mitigation insurance coverage for such

18 structure;

19 ‘‘(C) shall provide for the flood insurance

20 coverage under this title to pay, in the event of

21 any single occasion of flood damage, not more

22 than 40 percent of the value of the structure

23 (as the Director shall determine under the pro24 cedure under paragraph (2)(A)) or the actual

25 damage incurred, whichever is less; and
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1 ‘‘(D) shall provide for the cancellation of

2 the flood insurance coverage for such structure

3 after the payment for any damages pursuant to

4 subparagraph (C).

5 ‘‘(4) CLAIM PAYMENT AND COVERAGE LIMITA6 TION REGARDING COMMUNITY PARTICIPATION.—

7 With respect to any structure covered under a con8 tract for flood insurance under this title that is lo9 cated in a community that has not adopted the ero10 sion management measures under subsection (c),

11 after the certification or condemnation of the struc12 ture pursuant to subsection (d)(4) the Director

13 shall—

14 ‘‘(A) provide for a claim under flood insur15 ance coverage under this title, in the event of

16 any single occasion of flood damage, in an

17 amount of not more than 40 percent of the

18 value of the structure (as the Director shall de19 termine under the procedure under paragraph

20 (2)(A)) or the actual damage incurred, which21 ever is less; and

22 ‘‘(B) provide for the cancellation of the

23 flood insurance coverage for such structure

24 after the payment for any damages pursuant to

25 subparagraph (A).
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1 ‘‘(i) MITIGATION INSURANCE PREMIUMS AND SUR2 CHARGES.—

3 ‘‘(1) IN GENERAL.—The Director shall on occa4 sion, after consultation with the advisory committee

5 under section 1318, appropriate representatives of

6 the pool formed or otherwise created under section

7 1331, and appropriate representatives of the insur8 ance authorities of the respective States, prescribe

9 by regulation under subsection (1)—

10 ‘‘(A) chargeable premium rates for any

11 types and classes of properties for which miti12 gation insurance coverage shall be available

13 under this section; and

14 ‘‘(B) the terms and conditions under

15 which, and the areas (including subdivisions

16 thereof) within which such rates shall apply.

17 ‘‘(2) SURCHARGES.—The Director shall provide

18 for surcharges under contracts for flood insurance

19 under this title for structures described in subsection

20 (d)(3) and establish rates for such surcharges, in21 cluding rates for surcharges for each of the areas

22 within the 10-year, 30-year, and 60-year erosion set23 backs established under section 1360(g).

24 ‘‘(3) GENERAL RATE CALCULATION.—Mitiga25 tion insurance rates and surcharge rates under this
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1 subsection for each structure shall, insofar as prac2 ticable—

3 ‘‘(A) be based on a consideration of the

4 number and amount of claims previously paid

5 under a contract for flood insurance under this

6 title for the structure;

7 ‘‘(B) be determined for each of the areas

8 within the 10-year, 30-year, and 60-year ero9 sion setbacks under section 1360(g); and

10 ‘‘(C) provide for discounted rates and sur11 charges for structures—

12 ‘‘(i) for which the date of the con13 struction precedes the date of the estab14 lishment of the relevant erosion hazard

15 zones under section 1360(g)(1) in which

16 the structure is located; and

17 ‘‘(ii) for which mitigation activities

18 under subsection (g)(2)(B)(ii) have been

19 completed, at a rate that reflects the level

20 of protection against flood damage af21 forded the structure by such activities.

22 ‘‘(4) ADMINISTRATIVE COSTS.—The rates and

23 surcharges established by the Director under this

24 subsection may include any amount for administra25 tive expenses of carrying out the mitigation insur-
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1 ance program under this section as the Director de2 termines necessary, pursuant to consultation as pro3 vided under paragraph (1).

4 ‘‘(j) APPEALS.—The Director shall provide for ap5 peals by owners of structures covered by a contract for

6 mitigation insurance under this section that are eligible

7 for a mitigation claim payment, for the purposes of chal8 lenging—

9 ‘‘(1) the eligibility status of the structure under

10 subsections (e) and (f); and

11 ‘‘(2) the mitigation action selected by the Direc12 tor under subsection (g)(1) or (h)(1).

13 ‘‘(k) REGULATIONS.—The Director shall promulgate

14 regulations and guidelines to implement the provisions of

15 this section.’’.

16 (b) DEFINITIONS.—Section 1370(a) of the National

17 Flood Insurance Act of 1968 (42 U.S.C. 4121), as amend18 ed by section 102(a) of this Act, is further amended by

19 adding at the end the following new paragraph:

20 ‘‘(13) the term ‘mitigation insurance’ means

21 coverage under the national flood insurance program

22 under this title for flood and erosion damage and

23 mitigation activities, as provided in section 1306a.’’.
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1 SEC. 404. LIMITATIONS ON FLOOD INSURANCE COVERAGE

2 IN AREAS OF EXTREME EROSION RISK.

3 The National Flood Insurance Act of 1968 (42

4 U.S.C. 4001 et seq.) is amended by inserting after section

5 1313 the following new section:

6 ‘‘PROPERTIES LOCATED WITHIN 10-YEAR EROSION

7 SETBACK

8 ‘‘SEC. 1314. After the initial establishment of erosion

9 setbacks under section 1360(g), the Director may not

10 make flood insurance available with respect to any new

11 or substantially improved construction located within the

12 10-year erosion setback established by the Director under

13 such section.’’.

14 SEC. 405. MODIFICATION OF FLOODPLAIN MANAGEMENT

15 PROVISIONS.

16 Section 1315 of the National Flood Insurance Act of

17 1968 (42 U.S.C. 4022), as amended by section 301 of this

18 Act, is further amended by adding at the end the following

19 new subsection:

20 ‘‘(c) MODIFICATION OF REQUIREMENT FOR PARTICI21 PATION FOR AREAS NOT ADOPTING EROSION MANAGE22 MENT MEASURES.—After the date of the adoption by a

23 community of the applicable flood insurance rate map for

24 the community under section 1360(a)(2), new flood insur25 ance coverage may not be provided under this title in any

26 area (or subdivision thereof) for which the appropriate
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1 public body has not adopted erosion management meas2 ures in accordance with the requirements of section

3 1306a(c), unless the appropriate public body shall have

4 adopted adequate land use and control measures under

5 subsection (a) that also contain the following require6 ments:

7 ‘‘(1) BUILDING STANDARDS.—Any new or sub8 stantially improved construction located in an ero9 sion hazard zone under section 1360(g)(1) shall

10 comply with building standards applicable for coastal

11 high hazard areas.

12 ‘‘(2) BASE FLOOD ELEVATION STANDARDS.—

13 Any new or substantially improved construction lo14 cated in an erosion hazard zone established by the

15 Director under section 1360(g)(1) shall comply with

16 whichever of the following elevation standards af17 fords the greater protection from flood damage:

18 ‘‘(A) The elevation standard (existing at

19 the time of the construction) affording protec20 tion for the 100-year frequency flood that is ap21 plicable to the area within the 10-year erosion

22 setback established by the Director under such

23 subsection.

24 ‘‘(B) The actual elevation standard for the

25 construction site (existing at the time of con-
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1 struction) affording protection for the 100-year

2 frequency flood.’’.

3 SEC. 406. RIVERINE EROSION STUDY.

4 (a) STUDY.—The Director of the Federal Emergency

5 Management Agency shall conduct a study to determine

6 the feasibility of identifying and establishing erosion rates

7 for communities subject to riverine erosion hazards and

8 the best manner of identifying and establishing such rates.

9 Under the study the Director shall—

10 (1) investigate and assess existing and state-of11 the-art technical methodologies for assessing riverine

12 erosion;

13 (2) examine natural riverine processes, environ14 mental conditions, and human-induced changes to

15 the banks of rivers and streams, examples of erosion

16 and likely causes, and examples of erosion control

17 and reasons for their performance; and

18 (3) analyze riverine erosion management strate19 gies, the technical standards, methods, and data nec20 essary to support such strategies, and methods of

21 administering such strategies through the national

22 flood insurance program.

23 (b) REPORT.—The Director shall submit a report to

24 the Congress regarding the findings and conclusions of the

25 study under this section not later than the expiration of
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1 the 2-year period beginning on the date of the enactment

2 of this Act. The report shall include any recommendations

3 of the Director regarding appropriate methods and ap4 proaches for identifying and determining riverine erosion

5 rates and management strategies relating to riverine ero6 sion.

7 TITLE V—FLOOD INSURANCE

8 TASK FORCE

9 SEC. 501. FLOOD INSURANCE INTERAGENCY TASK FORCE.

10 (a) ESTABLISHMENT.—There is hereby established

11 an interagency task force to be known as the Flood Insur12 ance Task Force (in this section referred to as the ‘‘Task

13 Force’’).

14 (b) MEMBERSHIP.—

15 (1) IN GENERAL.—The Task Force shall be

16 composed of 7 members, who shall be the designees

17 of—

18 (A) the Federal Insurance Administrator;

19 (B) the Federal Housing Commissioner;

20 (C) the Secretary of Veterans Affairs;

21 (D) the Administrator of the Farmers

22 Home Administration;

23 (E) the Administrator of the Small Busi24 ness Administration;
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1 (F) a designee of the Financial Institutions

2 Examination Council;

3 (G) the chairman of the Board of Direc4 tors of the Federal Home Loan Mortgage Cor5 poration;

6 (H) the chairman of the Board of Direc7 tors of the Federal National Mortgage Associa8 tion;

9 (I) the Under Secretary of Commerce for

10 Oceans and Atmosphere;

11 (J) the Director of the United States Fish

12 and Wildlife Service; and

13 (K) the Administrator of the Environ14 mental Protection Agency.

15 (2) QUALIFICATIONS.—Members of the Task

16 Force shall be designated for membership on the

17 Task Force by reason of demonstrated knowledge

18 and competence regarding the national flood insur19 ance program.

20 (c) DUTIES.—The Task Force shall carry out the fol21 lowing duties:

22 (1) Make recommendations to the head of each

23 Federal agency and corporation referred to under

24 subsection (b)(1) regarding establishment or adop25 tion of standardized enforcement procedures among
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1 such agencies and corporations responsible for en2 forcing compliance with the requirements under the

3 national flood insurance program to ensure fullest

4 possible compliance with such requirements.

5 (2) Conduct a study of the extent to which Fed6 eral agencies and the secondary mortgage market

7 can provide assistance in ensuring compliance with

8 the requirements under the national flood insurance

9 program and submit to the Congress a report de10 scribing the study and any conclusions.

11 (3) Conduct a study of the extent to which ex12 isting programs of Federal agencies and corpora13 tions for compliance with the requirements under

14 the national flood insurance program can serve as a

15 model for other Federal agencies responsible for en16 forcing compliance, and submit to the Congress a re17 port describing the study and any conclusions.

18 (4) Develop guidelines regarding enforcement

19 and compliance procedures, based on the studies and

20 findings of the Task Force and publishing the guide21 lines in a usable format.

22 (d) NONCOMPENSATION.—Members of the Task

23 Force shall receive no additional pay by reason of their

24 service on the Task Force.
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1 (e) CHAIRPERSON.—The members of the Task Force

2 shall elect one member as chairperson of the Task Force.

3 (f) MEETINGS AND ACTION.—The Task Force shall

4 meet at the call of the chairman or a majority of the mem5 bers of the Task Force and may take action by a vote

6 of the majority of the members. The Federal Insurance

7 Administrator shall coordinate and call the initial meeting

8 of the Task Force.

9 (g) OFFICERS.—The chairperson of the Task Force

10 may appoint any officers to carry out the duties of the

11 Task Force under subsection (c).

12 (h) STAFF OF FEDERAL AGENCIES.—Upon request

13 of the chairperson of the Task Force, the head of any of

14 the Federal agencies and corporations referred to under

15 subsection (b)(1) may detail, on a nonreimbursable basis,

16 any of the personnel of such agency to the Task Force

17 to assist the Task Force in carrying out its duties under

18 this Act.

19 (i) POWERS.—In carrying out this section, the Task

20 Force may hold hearings, sit and act at times and places,

21 take testimony, receive evidence and assistance, provide

22 information, and conduct research as the Task Force con23 siders appropriate.

24 (j) SUBCOMMITTEE ON NATURAL AND BENEFICIAL

25 FUNCTIONS OF THE FLOODPLAIN.—The members of the
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1 Task Force appointed under subsections (b)(1) (I), (J),

2 and (K) shall constitute a select subcommittee which, in

3 addition to their duties under subsection (c), shall make

4 recommendations regarding the implementation of the

5 provisions of the National Flood Insurance Compliance,

6 Mitigation, and Erosion Management Act of 1993 that

7 deal with protection of the natural and beneficial functions

8 of the floodplain.

9 (k) TERMINATION.—The Task Force shall terminate

10 upon the expiration of the 24-month period beginning

11 upon the designation of the last member to be designated

12 under subsection (b)(1).

13 TITLE VI—MISCELLANEOUS

14 PROVISIONS

15 SEC. 601. MAXIMUM FLOOD INSURANCE COVERAGE

16 AMOUNTS.

17 (a) IN GENERAL.—Section 1306(b) of the National

18 Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) is

19 amended—

20 (1) in paragraph (1)(A)—

21 (A) by inserting ‘‘and’’ after the comma at

22 the end of clause (i);

23 (B) by striking ‘‘, and’’ at the end of

24 clause (ii) and inserting ‘‘; and’’; and

25 (C) by striking clause (iii);
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1 (2) by striking subparagraph (B) of paragraph

2 (1) and inserting the following new subparagraph:

3 ‘‘(B) in the case of any nonresidential

4 property, including churches—

5 ‘‘(i) $100,000 aggregate liability for

6 each structure, and

7 ‘‘(ii) $100,000 aggregate liability for

8 any contents related to each structure;’’;

9 (3) by striking subparagraph (C) of paragraph

10 (1);

11 (4) in paragraph (2), by striking ‘‘so as to en12 able’’ and all that follows through the end of the

13 paragraph and inserting ‘‘up to an amount, includ14 ing the limits specified in clause (i) of subparagraph

15 (A) of paragraph (1), of $250,000 multiplied by the

16 number of dwelling units in the building;’’;

17 (5) in paragraph (3), by striking ‘‘so as to en18 able’’ and all that follows through the end of the

19 paragraph and inserting ‘‘up to an amount of

20 $90,000 for any single-family dwelling and $240,000

21 for any residential structure containing more than

22 one dwelling unit;’’; and

23 (6) by striking paragraph (4) and inserting the

24 following new paragraph:
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1 ‘‘(4) in the case of any nonresidential property,

2 including churches, additional flood insurance in ex3 cess of the limits specified in clauses (i) and (ii) of

4 subparagraph (B) of paragraph (1) shall be made

5 available to every insured upon renewal and every

6 applicant for insurance up to an amount of

7 $2,400,000 for each structure and $2,400,000 for

8 any contents related to each structure; and’’.

9 (b) REMOVAL OF CEILING ON COVERAGE RE10 QUIRED.—Section 1306(b) of the National Flood Insur11 ance Act of 1968 (42 U.S.C. 4013(b)) is amended—

12 (1) in paragraph (5), by striking ‘‘; and’’ at the

13 end and inserting a period; and

14 (2) by striking paragraph (6).

15 (c) CONFORMING AMENDMENTS.—Section

16 1306(b)(5) of the National Flood Insurance Act of 1968

17 (42 U.S.C. 4013(b)(5)) is amended—

18 (1) by striking ‘‘(A), (B), or (C)’’ and inserting

19 ‘‘(A) or (B)’’; and

20 (2) by striking ‘‘(1)(C)’’.

21 SEC. 602. FLOOD INSURANCE PROGRAM ARRANGEMENTS

22 WITH PRIVATE INSURANCE ENTITIES.

23 Section 1345(b) of the National Flood Insurance Act

24 of 1968 (42 U.S.C. 4081(b)) is amended by striking the

25 period at the end and inserting the following: ‘‘and without
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1 regard to the provisions of the Federal Advisory Commit2 tee Act (5 U.S.C. App.).’’.

3 SEC. 603. UPDATING OF FLOOD MAPS AND ASSESSMENT

4 AND MAPPING OF EROSION HAZARD ZONES.

5 Section 1360 of the National Flood Insurance Act of

6 1968 (42 U.S.C. 4101) is amended by adding at the end

7 the following new subsections:

8 ‘‘(e) Once during each 5-year period (the 1st such

9 period beginning on the date of the enactment of the Na10 tional Flood Insurance Compliance, Mitigation, and Ero11 sion Management Act of 1993) or more often as the Direc12 tor determines necessary because of storm-induced ero13 sion, increased watershed development, or other extraor14 dinary situations, the Director shall assess the need to re15 vise and update all floodplain areas and flood risk zones

16 identified, delineated, or established under this section.

17 ‘‘(f) The Director shall revise and update any flood18 plain areas and flood-risk zones—

19 ‘‘(1) upon the determination of the Director,

20 according to the assessment under subsection (e),

21 that revision and updating are necessary for the

22 areas and zones; or

23 ‘‘(2) upon the request from any State or local

24 government stating that specific floodplain areas or

25 flood-risk zones in the State or locality need revision
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1 or updating, if sufficient technical data justifying

2 the request is submitted and the unit of government

3 making the request agrees to provide funds in an

4 amount equal to the amount of funds provided by

5 the Director (or the equivalent value of data, tech6 nical analysis, or other in-kind services) for the re7 quested revision or update.

8 ‘‘(g)(1) Not later than the expiration of the 6-year

9 period beginning on the date of the enactment of the Na10 tional Flood Insurance Compliance, Mitigation, and Ero11 sion Management Act of 1993, the Director shall assess,

12 identify, and map, before all areas along the shorelines

13 of the Great Lakes and the tidal waters of the United

14 States that have special erosion hazards (in this section

15 referred to as ‘erosion hazard zones’), as provided in this

16 subsection.

17 ‘‘(2) On each flood insurance rate map established

18 under this section, the Director shall identify and provide

19 legible demarcation for areas that are subject to special

20 erosion hazards within a 60-year period based on past an21 nual average rates of shoreline retreat in such areas (in

22 this section referred to as the ‘60-year erosion setback’).

23 ‘‘(3) On each flood insurance rate map established

24 under this section, the Director shall provide information

25 by area regarding the existing annual average rate of ero-
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1 sion for each area, so that users of the maps can delineate

2 boundaries for areas subject to erosion within 10 years

3 (in this section referred to as the ‘10-year erosion set4 back’) and within 30 years (in this section referred to as

5 the ‘30-year erosion setback’).

6 ‘‘(4) The Director shall provide for revising and up7 dating erosion hazard zones as frequently as the Director

8 determines to be necessary for purposes of this title. In

9 revising the geographical boundaries of erosion hazard

10 zones, the Director shall place special emphasis on consid11 ering—

12 ‘‘(A) the 10-year erosion setback, based on the

13 past annual average rates of shoreline and coastline

14 retreat in such areas;

15 ‘‘(B) areas (or subdivisions thereof) that are ex16 periencing or have recently experienced erosion rates

17 in excess of the annual average erosion rate, due to

18 storms, high lake levels, or other factors; and

19 ‘‘(C) areas where erosion control measures have

20 been implemented or erosion rates have been other21 wise significantly altered by manmade or induced ac22 tivity.’’.
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1 SEC. 604. FUNDING FOR INCREASED ADMINISTRATIVE AND

2 OPERATIONAL RESPONSIBILITIES.

3 (a) AVAILABILITY OF FUND.—Section 1310(a) of the

4 National Flood Insurance Act of 1968 (42 U.S.C.

5 4017(a)), as amended by section 302 of this Act, is

6 amended—

7 (1) in the matter preceding paragraph (1), by

8 inserting ‘‘(except as otherwise provided)’’ after

9 ‘‘without fiscal year limitation’’; and

10 (2) by adding at the end the following new

11 paragraphs:

12 ‘‘(7) for administrative costs necessary to de13 velop and service the program for mitigation insur14 ance under section 1306a, including costs necessary

15 to provide technical assistance in determining and

16 monitoring the appropriate mitigation action for

17 structures under such section;

18 ‘‘(8) for assessment and mapping of erosion

19 hazard zones under section 1360(g), except that the

20 fund shall be available for the purpose under this

21 paragraph in an amount not to exceed an aggregate

22 of $25,000,000 over the 6-year period beginning on

23 the date of the enactment of the National Flood In24 surance Compliance, Mitigation, and Erosion Man25 agement Act of 1993; and
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1 ‘‘(9) for the revision and updating of erosion

2 hazard zones under section 1360(g)(4), except that

3 the fund shall be available for the purpose under

4 this paragraph in an amount not to exceed

5 $2,000,000 in each fiscal year beginning after the

6 expiration of the 6-year period beginning on the date

7 of the enactment of the National Flood Insurance

8 Compliance, Mitigation, and Erosion Management

9 Act of 1993.’’.

10 (b) CREDITS OF FUND.—Section 1310(b) of the Na11 tional Flood Insurance Act of 1968 (42 U.S.C. 4017(b))

12 is amended—

13 (1) in paragraph (5), by striking ‘‘and’’ at the

14 end;

15 (2) by redesignating paragraph (6) as para16 graph (7); and

17 (3) by inserting after paragraph (5) the follow18 ing new paragraph:

19 ‘‘(6) any penalties collected under section

20 102(e) of the Flood Disaster Protection Act of

21 1973.’’.

22 SEC. 605. REGULATIONS.

23 The Director of the Federal Emergency Management

24 Agency, the Secretary of Housing and Urban Develop25 ment, and any appropriate head of any Federal agency
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1 may each issue any regulations necessary to carry out the

2 applicable provisions of this Act and the applicable amend3 ments made by this Act.

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