Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 511 

[Riegle Community Development and Regulatory Improvement Act of 1994] 

P.L. 103-325 

TITLE V--NATIONAL FLOOD INSURANCE

REFORM

SEC. 501. SHORT TITLE. 

This title may be cited as the “National Flood Insurance Reform Act of 1994”. 

Subtitle A--Definitions 

SEC. 511. FLOOD DISASTER PROTECTION ACT OF 1973. 

(a) IN GENERAL.-- Section 3(a) of the Flood Disaster Protection Act of 

1973 (42 U.S.C. 4003(a)) is amended-­

(1) by striking paragraph (5) and inserting the following new 

paragraph: 

“(5) ‘Federal entity for lending regulation’ means the Board of 

Governors of the Federal Reserve System, the Federal Deposit Insurance 

Corporation, the Comptroller of the Currency, the Office of Thrift 

Supervision, the National Credit Union Administration, and the Farm Credit 

Administration, and with respect to a particular regulated lending institution 

means the entity primarily responsible for the supervision of the institution;”; 

(2) in paragraph (6), by striking the period at the end and inserting a 

semicolon; and 

(3) by inserting after paragraph (6) the following new paragraphs: 

“(7) ‘Federal agency lender’ means a Federal agency that makes direct 

loans secured by improved real estate or a mobile home, to the extent such 

agency acts in such capacity; 

“(8) the term ‘improved real estate’ means real estate upon which a 

building is located; 

“(9) ‘lender’ means a regulated lending institution or Federal agency 

lender; 

“(10) ‘regulated lending institution’ means any bank, savings and loan 

association, credit union, farm credit bank, Federal land bank association, 

production credit association, or similar institution subject to the supervision 

of a Federal entity for lending regulation; and 

“(11) ‘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.”. 

National Flood 

Insurance 

Reform Act of 

1994. 

42 U.S.C. 

4001 note. 

108 STAT. 2255
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 511 

Sept. 23 

Regulations. (b) CONFORMING AMENDMENT.-- Section 202(b) of the Flood Disaster 

Protection Act of 1973 (42 U.S.C. 4106(b)) is amended by striking “Federal 

instrumentality described in such section shall by regulation require the 

institutions” and inserting “Federal entity for lending regulation shall by 

regulation require the regulated lending institutions described in such section, 

and each Federal agency lender shall issue regulations requiring the Federal 

agency lender,”. 

SEC. 512. NATIONAL FLOOD INSURANCE ACT OF 1968. 

(a) IN GENERAL.-- Section 1370(a) of the National Flood Insurance Act of 

1968 (42 U.S.C. 4121(a)) is amended-­

(1) in paragraph (5), by striking “and” at the end; 

(2) in paragraph (6), by striking the period at the end and inserting a 

semicolon; and 

(3) by inserting after paragraph (6) the following new paragraphs: 

“(7) the term ‘repetitive loss structure’ means a structure covered by 

a contract for flood insurance under this title that has incurred floodrelated damage on 2 occasions during a 10-year period ending on the date 

of the event for which a second claim is made, in which the cost of repair, 

on the average, equaled or exceeded 25 percent of the value of the 

structure at the time of each such flood event; 

“(8) the term ‘Federal agency lender’ means a Federal agency that 

makes direct loans secured by improved real estate or a mobile home, to 

the extent such agency acts in such capacity; 

“(9) the term ‘Federal entity for lending regulation’ means the Board 

of Governors of the Federal Reserve System, the Federal Deposit 

Insurance Corporation, the Comptroller of the Currency, the Office of 

Thrift Supervision, the National Credit Union Administration, and the 

Farm Credit Administration, and with respect to a particular regulated 

lending institution means the entity primarily responsible for the 

supervision of the institution; 

“(10) the term ‘improved real estate’ means real estate upon which a 

building is located; 

“(11) the term ‘lender’ means a regulated lending institution or 

Federal agency lender; 

“(12) the term ‘natural and beneficial floodplain functions’ means-­

“(A) the functions associated with the natural or relatively 

undisturbed floodplain that (i) moderate flooding, retain flood waters, 

reduce erosion and sedimentation, and mitigate the effect of waves 

and storm surge from storms, and (ii) reduce flood related damage; 

and 

“(B) ancillary beneficial functions, including maintenance of 

water quality and recharge of ground water, that reduce flood related 

damage; 

“(13) the term ‘regulated lending institution’ means any bank, savings 

and loan association, credit union, farm credit bank, Federal land bank 

association, production credit association, or similar institution subject to 

the supervision of a Federal entity for lending regulation; and 

“(14) the term ‘servicer’ means the person responsible for receiving 

any scheduled periodic payments from a borrower pursuant to the [2257] 

108 STAT. 2256
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 522 

P.L. 103-325 

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.”.

(b) CONFORMING AMENDMENT.-- Section 1322(d) of the National Flood

Insurance Act of 1968 (42 U.S.C. 4029(d)) is amended by striking “federally 

supervised, approved, regulated or insured financial institution” and inserting 

“regulated lending institution or Federal agency lender”. 

Subtitle B--Compliance and Increased Participation Loans. 

Real 

Property. 

SEC. 521. NONWAIVER OF FLOOD PURCHASE REQUIREMENT FOR 

RECIPIENTS OF FEDERAL DISASTER ASSISTANCE. 

Section 311(b) of the Robert T. Stafford Disaster Relief and Emergency 

Assistance Act (42 U.S.C. 5154(b)) is amended by adding at the end the following 

new sentence: “The requirements of this subsection may not be waived under section 

301.”. 

SEC. 522. EXPANDED FLOOD INSURANCE PURCHASE REQUIREMENTS. 

(a) IN GENERAL.-- Section 102(b) of the Flood Disaster Protection Act of 1973 

(42 U.S.C. 4012a(b)) is amended to read as follows: 

“(b) REQUIREMENT FOR MORTGAGE LOANS.-­

“(1) REGULATED LENDING INSTITUTIONS.-- Each Federal entity for 

lending regulation (after consultation and coordination with the Financial 

Institutions Examination Council established under the Federal Financial 

Institutions Examination Council Act of 1974) shall by regulation direct 

regulated lending institutions not to make, increase, extend, or renew any loan 

secured by improved real estate or a mobile home located or to be located in an 

area that has been identified by the Director as an area having special flood 

hazards and in which flood insurance has been made available under the 

National Flood Insurance Act of 1968, unless the building or mobile home and 

any personal property securing such loan is covered for the term of the loan by 

flood insurance in an amount at least equal to the outstanding principal balance 

of the loan or the maximum limit of coverage made available under the Act with 

respect to the particular type of property, whichever is less. 

“(2) FEDERAL AGENCY LENDERS.-- A Federal agency lender may not 

make, increase, extend, or renew any loan secured by improved real estate or a 

mobile home located or to be located in an area that has been identified by the 

Director as an area having special flood hazards and in which flood insurance 

has been made available under the National Flood Insurance Act of 1968, 

unless the building or mobile home and any personal property securing such 

loan is covered for the term of the loan by flood insurance in the amount provided in paragraph (1). Each Federal agency lender shall issue any regula-tions Regulations. 

necessary to carry out this paragraph. Such regulations shall be consistent with 

and substantially identical to the regulations issued under paragraph (1). 

108 STAT. 2257
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 522 

Sept. 23 

“(3) GOVERNMENT-SPONSORED ENTERPRISES FOR HOUSING.-- The 

Federal National Mortgage Association and the Federal Home Loan 

Mortgage Corporation shall implement procedures reasonably designed to 

ensure that, for any loan that is-­

“(A) secured by improved real estate or a mobile home located 

in an area that has been identified, at the time of the origination of the 

loan or at any time during the term of the loan, by the Director as an 

area having special flood hazards and in which flood insurance is 

available under the National Flood Insurance Act of 1968, and 

“(B) purchased by such entity, 

the building or mobile home and any personal property securing 

the loan is covered for the term of the loan by flood insurance in the 

amount provided in paragraph (1). 

“(4) APPLICABILITY.-­

“(A) EXISTING COVERAGE.-- Except as provided in 

subparagraph (B), paragraph (1) shall apply on the date of enactment 

of the Riegle Community Development and Regulatory Improvement 

Act of 1994. 

“(B) NEW COVERAGE.-- Paragraphs (2) and (3) shall apply only 

with respect to any loan made, increased, extended, or renewed after 

the expiration of the 1-year period beginning on the date of 

enactment of the Riegle Community Development and Regulatory 

Improvement Act of 1994. Paragraph (1) shall apply with respect to 

any loan made, increased, extended, or renewed by any lender 

supervised by the Farm Credit Administration only after the 

expiration of the period under this subparagraph. 

“(C) CONTINUED EFFECT OF REGULATIONS.-- Notwithstanding 

any other provision of this subsection, the regulations to carry out 

paragraph (1), as in effect immediately before the date of enactment 

of the Riegle Community Development and Regulatory Improvement 

Act of 1994, shall continue to apply until the regulations issued to 

carry out paragraph (1) as amended by section 522(a) of such Act 

take effect.”. 

(b) EXEMPTION FOR SMALL LOANS.-- Section 102(c) of the Flood Disaster 

Protection Act of 1973 (42 U.S.C. 4012a(c)) is amended-­

(1) by striking “(c) Notwithstanding” and inserting the following: 

“(c) EXCEPTIONS TO PURCHASE REQUIREMENTS.-­

“(1) STATE-OWNED PROPERTY.-- Notwithstanding”; and 

(2) by adding at the end the following new paragraph: 

“(2) SMALL LOANS.-- Notwithstanding any other provision of this 

section, subsections (a) and (b) shall not apply to any loan having-­

“(A) an original outstanding principal balance of $5,000 or 

less; and 

“(B) a repayment term of 1 year or less.”. 

SEC. 523. ESCROW OF FLOOD INSURANCE PAYMENTS. 

Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 

4012a) is amended by adding at the end the following new subsection: 

“(d) ESCROW OF FLOOD INSURANCE PAYMENTS.-­

“(1) REGULATED LENDING INSTITUTIONS.-- Each Federal entity for 

lending regulation (after consultation and coordination [2259] with the 

108 STAT. 2258
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 524 

P.L. 103-325 

Financial Institutions Examination Council) shall by regulation require that, if 

a regulated lending institution requires the escrowin8g of taxes, insurance 

premiums, fees, or any other charges for a loan secured by residential 

improved real estate or a mobile home, then all premiums and fees for flood 

insurance under the National Flood Insurance Act of 1968 for the real estate 

or mobile home shall be paid to the regulated lending institution or other 

servicer for the loan in a manner sufficient to make payments as due for the 

duration of the loan. Upon receipt of the premiums, the regulated lending 

institution or servicer of the loan shall deposit the premiums in an escrow 

account on behalf of the borrower. Upon receipt of a notice from the Director 

or the provider of the insurance that insurance premiums are due, the 

regulated lending institution or servicer shall pay from the escrow account to 

the provider of the insurance the amount of insurance premiums owed. 

“(2) FEDERAL AGENCY LENDERS.-- Each Federal agency lender shall by 

regulation require and provide for escrow and payment of any flood insurance 

premiums and fees relating to residential improved real estate and mobile 

homes securing loans made by the Federal agency lender under the 

circumstances and in the manner provided under paragraph (1). Any regulations issued under this paragraph shall be consistent with and substantially 

identical to the regulations issued under paragraph (1). 

“(3) APPLICABILITY OF RESPA.-- Escrow accounts established pursuant 

to this subsection shall be subject to the provisions of section 10 of the Real 

Estate Settlement Procedures Act of 1974. 

“(4) DEFINITION.-- For purposes of this subsection, the term ‘residential 

improved real estate’ means improved real estate for which the improvement 

is a residential building. 

“(5) APPLICABILITY.-- This subsection shall apply only with respect to 

any loan made, increased, extended, or renewed after the expiration of the 1-

year period beginning on the date of enactment of the Riegle Community 

Development and Regulatory Improvement Act of 1994.”. 

SEC. 524. PLACEMENT OF FLOOD INSURANCE BY LENDERS. 

Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a), 

as amended by the preceding provisions of this title, is further amended by adding 

at the end the following new subsection: 

“(e) PLACEMENT OF FLOOD INSURANCE BY LENDER.-­

“(1) NOTIFICATION TO BORROWER OF LACK OF COVERAGE.-- If, at the 

time of origination or at any time during the term of a loan secured by 

improved real estate or by a mobile home located in an area that has been 

identified by the Director (at the time of the origination of the loan or at any 

time during the term of the loan) as an area having special flood hazards and 

in which flood insurance is available under the National Flood Insurance Act 

of 1968, the lender or servicer for the loan determines that the building or 

mobile home and any personal property securing the loan is not covered by 

flood insurance or is covered by such insurance in an amount less than the 

amount required for the property pursuant to [2260] paragraph (1), (2), or (3) 

Regulations. 

108 STAT. 2259
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. Sept. 23 

Sec. 524 

of subsection (b), the lender or servicer shall notify the borrower under the 

loan that the borrower should obtain, at the borrower’s expense, an 

amount of flood insurance for the building or mobile home and such 

personal property that is not less than the amount under subsection (b)(1), 

for the term of the loan. 

“(2) PURCHASE OF COVERAGE ON BEHALF OF BORROWER.-- If the 

borrower fails to purchase such flood insurance within 45 days after 

notification under paragraph (1), the lender or servicer for the loan shall 

purchase the insurance on behalf of the borrower and may charge the 

borrower for the cost of premiums and fees incurred by the lender or 

servicer for the loan in purchasing the insurance. 

“(3) REVIEW OF DETERMINATION REGARDING REQUIRED PURCHASE.-­

“(A) IN GENERAL.-- The borrower and lender for a loan secured 

by improved real estate or a mobile home may jointly request the 

Director to review a determination of whether the building or mobile 

home is located in an area having special flood hazards. Such request 

shall be supported by technical information relating to the improved 

real estate or mobile home. Not later than 45 days after the Director 

receives the request, the Director shall review the determination and 

provide to the borrower and the lender with a letter stating whether 

or not the building or mobile home is in an area having special flood 

hazards. The determination of the Director shall be final. 

“(B) EFFECT OF DETERMINATION.-- Any person to whom a 

borrower provides a letter issued by the Director pursuant to 

subparagraph (A), stating that the building or mobile home securing 

the loan of the borrower is not in an area having special flood 

hazards, shall have no obligation under this title to require the 

purchase of flood insurance for such building or mobile home during 

the period determined by the Director, which shall be specified in the 

letter and shall begin on the date on which such letter is provided. 

“(C) EFFECT OF FAILURE TO RESPOND.-- If a request under 

subparagraph (A) is made in connection with the origination of a loan 

and the Director fails to provide a letter under subparagraph (A) 

before the later of (i) the expiration of the 45-day period under such 

subparagraph, or (ii) the closing of the loan, no person shall have an 

obligation under this title to require the purchase of flood insurance 

for the building or mobile home securing the loan until such letter is 

provided. 

“(4) APPLICABILITY.-- This subsection shall apply to all loans 

outstanding on or after the date of enactment of the Riegle Community 

Development and Regulatory Improvement Act of 1994.”. 

SEC. 525. PENALTIES FOR FAILURE TO REQUIRE FLOOD 

INSURANCE OR NOTIFY. 

Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 

4012a), as amended by the preceding provisions of this title, is further amended 

by adding at the end the following new subsections: 

108 STAT. 2260
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 525 

P.L. 103-325 

“(f) CIVIL MONETARY PENALTIES FOR FAILURE TO REQUIRE FLOOD 

INSURANCE OR NOTIFY.-­

“(1) CIVIL MONETARY PENALTIES AGAINST REGULATED LENDERS.-­

Any regulated lending institution that is found to have a pattern or practice of 

committing violations under paragraph (2) shall be assessed a civil penalty by 

the appropriate Federal entity for lending regulation in the amount provided 

under paragraph (5). 

“(2) LENDER VIOLATIONS.-- The violations referred to in paragraph (1) 

shall include-­

“(A) making, increasing, extending, or renewing loans in 

violation of-­

“(i) the regulations issued pursuant to subsection (b) of 

this section; 

“(ii) the escrow requirements under subsection (d) of this 

section; or 

“(iii) the notice requirements under section 1364 of the 

National Flood Insurance Act of 1968; or 

“(B) failure to provide notice or purchase flood insurance 

coverage in violation of subsection (e) of this section. 

“(3) CIVIL MONETARY PENALTIES AGAINST GSE’S.-­

“(A) IN GENERAL.-- If the Federal National Mortgage 

Association or the Federal Home Loan Mortgage Corporation is found 

by the Director of the Office of Federal Housing Enterprise Oversight of 

the Department of Housing and Urban Development to have a pattern or 

practice of purchasing loans in violation of the procedures established 

pursuant to subsection (b)(3), the Director of such Office shall assess a 

civil penalty against such enterprise in the amount provided under 

paragraph (5) of this subsection. 

“(B) DEFINITION.-- For purposes of this subsection, the term 

‘enterprise’ means the Federal National Mortgage Association or the 

Federal Home Loan Mortgage Corporation. 

“(4) NOTICE AND HEARING.-- A penalty under this subsection may be 

issued only after notice and an opportunity for a hearing on the record. 

“(5) AMOUNT.-- A civil monetary penalty under this subsection may not 

exceed $350 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. 

“(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). 

“(7) EFFECT OF TRANSFER ON LIABILITY.-- Any sale or other transfer of 

a loan by a regulated lending institution that has committed a violation under 

paragraph (1), that occurs subsequent to the violation, shall not affect the 

liability of the transferring lender with respect to any penalty under this 

subsection. A lender shall not be liable for any violations relating [2262] to a 

108 STAT. 2261
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. Sept. 23 

Sec. 525 

loan committed by another regulated lending institution that previously 

held the loan 

“(8) DEPOSIT OF PENALTIES.-- Any penalties collected under this 

subsection shall be paid into the National Flood Mitigation Fund under 

section 1367 of the National Flood Insurance Act of 1968. 

“(9) ADDITIONAL PENALTIES.-- Any penalty under this subsection 

shall be in addition to any civil remedy or criminal penalty otherwise 

available. 

“(10) STATUTE OF LIMITATIONS.-- No penalty may be imposed under 

this subsection after the expiration of the 4-year period beginning on the 

date of the occurrence of the violation for which the penalty is authorized 

under this subsection. 

“(g) OTHER ACTIONS TO REMEDY PATTERN OF NONCOMPLIANCE.-­

“(1) AUTHORITY OF FEDERAL ENTITIES FOR LENDING REGULATION.-­

A Federal entity for lending regulation may require a regulated lending 

institution to take such remedial actions as are necessary to ensure that the 

regulated lending institution complies with the requirements of the national 

flood insurance program if the Federal agency for lending regulation makes 

a determination under paragraph (2) regarding the regulated lending 

institution. 

“(2) DETERMINATION OF VIOLATIONS.-- A determination under this 

paragraph shall be a finding that-­

“(A) the regulated lending institution has engaged in a pattern 

and practice of noncompliance in violation of the regulations issued 

pursuant to subsection (b), (d), or (e) or the notice requirements 

under section 1364 of the National Flood Insurance Act of 1968; and 

“(B) the regulated lending institution has not demonstrated 

measurable improvement in compliance despite the assessment of 

civil monetary penalties under subsection (f).”. 

SEC. 526. FEES FOR DETERMINING APPLICABILITY OF FLOOD 

INSURANCE PURCHASE REQUIREMENTS. 

Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 

4012a) as amended by the preceding provisions of this title, is further amended 

by adding at the end the following new subsection: 

“(h) FEE FOR DETERMINING LOCATION.-- Notwithstanding any other 

Federal or State law, any person who makes a loan secured by improved 

real estate or a mobile home or any servicer for such a loan may charge a 

reasonable fee for the costs of determining whether the building or mobile 

home securing the loan is located in an area having special flood hazards, 

but only in accordance with the following requirements: 

“(1) BORROWER FEE.-- The borrower under such a loan may 

be charged the fee, but only if the determination-­

“(A) is made pursuant to the making, increasing, 

extending, or renewing of the loan that is initiated by the 

borrower; 

“(B) is made pursuant to a revision or updating under 

section 1360(f) of the floodplain areas and flood-risk zones or 

108 STAT. 2262
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 527 

P.L. 103-325 

publication of a notice or compendia under subsection [2263] 

(h) or (i) of section 1360 that affects the area in which the 

improved real estate or mobile home securing the loan is 

located or that, in the determination of the Director, may 

reasonably be considered to require a determination under this 

subsection; or 

“(C) results in the purchase of flood insurance 

coverage pursuant to the requirement under subsection (e)(2). 

“(2) PURCHASER OR TRANSFEREE FEE.-- The purchaser or 

transferee of such a loan may be charged the fee in the case of sale or 

transfer of the loan.”. 

SEC. 527. NOTICE REQUIREMENTS. 

Section 1364 of the National Flood Insurance Act of 1968 (42 U.S.C. 4104a) 

is amended to read as follows: 

“NOTICE REQUIREMENTS 

“SEC. 1364. (a) NOTIFICATION OF SPECIAL FLOOD HAZARDS.-­

“(1) REGULATED LENDING INSTITUTIONS.-- Each Federal entity for 

lending regulation (after consultation and coordination with the Financial 

Institutions Examination Council) shall by regulation require regulated lending 

institutions, as a condition of making, increasing, extending, or renewing any 

loan secured by improved real estate or a mobile home that the regulated 

lending institution determines is located or is to be located in an area that has 

been identified by the Director under this title or the Flood Disaster 

Protection Act of 1973 as an area having special flood hazards, to notify the 

purchaser or lessee (or obtain satisfactory assurances that the seller or lessor 

has notified the purchaser or lessee) and the servicer of the loan of such 

special flood hazards, in writing, a reasonable period in advance of the signing 

of the purchase agreement, lease, or other documents involved in the 

transaction. The regulations shall also require that the regulated lending 

institution retain a record of the receipt of the notices by the purchaser or 

lessee and the servicer. 

“(2) FEDERAL AGENCY LENDERS.-- Each Federal agency lender shall 

by regulation require notification in the manner provided under paragraph (1) 

with respect to any loan that is made by the Federal agency lender and 

secured by improved real estate or a mobile home located or to be located in 

an area that has been identified by the Director under this title or the Flood 

Disaster Protection Act of 1973 as an area having special flood hazards. Any 

regulations issued under this paragraph shall be consistent with and 

substantially identical to the regulations issued under paragraph (1). 

“(3) CONTENTS OF NOTICE.-- Written notification required under this 

subsection shall include-­

“(A) a warning, in a form to be established by the Director, 

stating that the building on the improved real estate securing the loan 

is located, or the mobile home securing the loan is or is to be located, 

in an area having special flood hazards; 

“(B) a description of the flood insurance purchase 

requirements under section 102(b) of the Flood Disaster Protection 

Act of 1973; 

Records. 

Regulations. 

108 STAT. 2263
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 527 

Sept. 23 

“(C) a statement that flood insurance coverage may be 

purchased under the national flood insurance program and is also 

available from private insurers; and 

“(D) any other information that the Director considers 

necessary to carry out the purposes of the national flood insurance 

program. 

“(b) NOTIFICATION OF CHANGE OF SERVICER.-- Regulations. “(1) LENDING INSTITUTIONS.-- Each Federal entity for lending 

regulation (after consultation and coordination with the Financial 

Institutions Examination Council) shall by regulation require regulated 

lending institutions, in connection with the making, increasing, extending, 

renewing, selling, or transferring any loan described in subsection (a)(1), to 

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

term of the loan of the servicer of the loan. Such institutions shall also 

notify the Director (or such designee) of any change in the servicer of the 

loan, not later than 60 days after the effective date of such change. The 

regulations under this subsection shall provide that upon any change in the 

servicing of a loan, the duty to provide notification under this subsection 

shall transfer to the transferee servicer of the loan. 

Regulations. “(2) FEDERAL AGENCY LENDERS.-- Each Federal agency lender shall 

by regulation provide for notification in the manner provided under 

paragraph (1) with respect to any loan described in subsection (a)(1) that is 

made by the Federal agency lender. Any regulations issued under this 

paragraph shall be consistent with and substantially identical to the 

regulations issued under paragraph (1) of this subsection. 

“(c) NOTIFICATION OF EXPIRATION OF INSURANCE.-- The Director (or the 

designee of the Director) shall, not less than 45 days before the expiration of any 

contract for flood insurance under this title, issue notice of such expiration by 

first class mail to the owner of the property covered by the contract, the servicer 

of any loan secured by the property covered by the contract, and (if known to the 

Director) the owner of the loan.”. 

SEC. 528. STANDARD HAZARD DETERMINATION FORMS. 

Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 

et seq.) is amended by adding at the end the following new section: 

“STANDARD HAZARD DETERMINATION FORMS 

42 USC 4104b. “SEC. 1365. (a) DEVELOPMENT.-- The Director, in consultation with 

representatives of the mortgage and lending industry, the Federal entities for 

lending regulation, the Federal agency lenders, and any other appropriate 

individuals, shall develop a standard form for determining, in the case of a loan 

secured by improved real estate or a mobile home, whether the building or 

mobile home is located in an area identified by the Director as an area having 

special flood hazards and in which flood insurance under this title is available. 

Regulations. The form shall be established by regulations issued not later than 270 days after 

the date of enactment of the Riegle Community Development and Regulatory 

Improvement Act of 1994. 

“(b) DESIGN AND CONTENTS.-­

“(1) PURPOSE.-- The form under subsection (a) shall be designed to 

facilitate compliance with the flood insurance purchase requirements of this 

title. 

108 STAT. 2264
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 528 

P.L. 103-325 

“(2) CONTENTS.-- The form shall require identification of the type of 

flood-risk zone in which the building or mobile home is located, the 

complete map and panel numbers for the improved real estate or property 

on which the mobile home is located, the community identification number 

and community participation status (for purposes of the national flood 

insurance program) of the community in which the improved real estate or 

such property is located, and the date of the map used for the determination, 

with respect to flood hazard information on file with the Director. If the 

building or mobile home is not located in an area having special flood 

hazards the form shall require a statement to such effect and shall indicate 

the complete map and panel numbers of the improved real estate or 

property on which the mobile home is located. If the complete map and 

panel numbers are not available because the building or mobile home is not 

located in a community that is participating in the national flood insurance 

program or because no map exists for the relevant area, the form shall 

require a statement to such effect. The form shall provide for inclusion or 

attachment of any relevant documents indicating revisions or amendments 

to maps. 

“(c) REQUIRED USE.-- The Federal entities for lending regulation shall by 

regulation require the use of the form under this section by regulated lending 

institutions. Each Federal agency lender shall by regulation provide for the use of 

the form with respect to any loan made by such Federal agency lender. The Federal 

National Mortgage Association and the Federal Home Loan Mortgage Corporation 

and the Government National Mortgage Association shall require the use of the 

form with respect to any loan purchased by such entities. A lender or other person 

may comply with the requirement under this subsection by using the form in a 

printed, computerized, or electronic manner. 

“(d) GUARANTEES REGARDING INFORMATION.-- In providing information 

regarding special flood hazards on the form developed under this section, any 

lender (or other person required to use the form) who makes, increases, extends, or 

renews a loan secured by improved real estate or a mobile home may provide for 

the acquisition or determination of such information to be made by a person other 

than such lender (or other person), only to the extent such person guarantees the 

accuracy of the information. 

“(e) RELIANCE ON PREVIOUS DETERMINATION.-- Any person increasing, 

extending, renewing, or purchasing a loan secured by improved real estate or a 

mobile home may rely on a previous determination of whether the building or 

mobile home is located in an area having special flood hazards (and shall not be 

liable for any error in such previous determination), if the previous determination 

was made not more than 7 years before the date of the transaction and the basis for 

the previous determination has been set forth on a form under this section, unless-­

“(1) map revisions or updates pursuant to section 1360(f) after such 

previous determination have resulted in the building or mobile home being 

located in an area having special flood hazards; or 

“(2) the person contacts the Director to determine when the most 

recent map revisions or updates affecting such property occurred and such 

revisions and updates have occurred after such previous determination. 

Regulations. 

108 STAT. 2265
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 528 

Sept. 23 

Regulations. “(f) EFFECTIVE DATE.-- The regulations under this section requiring use of 

the form established pursuant to this section shall be issued together with the 

regulations required under subsection (a) and shall take effect upon the 

expiration of the 180-day period beginning on such issuance.”. 

SEC. 529. EXAMINATIONS REGARDING COMPLIANCE. 

(a) AMENDMENT TO FEDERAL DEPOSIT INSURANCE ACT.-- Section 10 of 

the Federal Deposit Insurance Act (12 U.S.C. 1820) is amended by adding at 

the end the following new subsection: 

“(i) FLOOD INSURANCE COMPLIANCE BY INSURED DEPOSITORY 

INSTITUTIONS-­

“(1) EXAMINATIONS.-- The appropriate Federal banking agency shall, 

during each scheduled on-site examination required by this section, 

determine whether the insured depository institution is complying with the 

requirements of the national flood insurance program. 

“(2) REPORT.-­

“(A) REQUIREMENT.-- Not later than 1 year after the date of 

enactment of the Riegle Community Development and Regulatory 

Improvement Act of 1994 and biennially thereafter for the next 4 

years, each appropriate Federal banking agency shall submit a report 

to the Congress on compliance by insured depository institutions with 

the requirements of the national flood insurance program. 

“(B) CONTENTS.-- Each report submitted under this paragraph 

shall include a description of the methods used to determine 

compliance, the number of institutions examined during the reporting 

year, a listing and total number of institutions found not to be in 

compliance, actions taken to correct incidents of noncompliance, and 

an analysis of compliance, including a discussion of any trends, 

patterns, and problems, and recommendations regarding reasonable 

actions to improve the efficiency of the examinations processes.”. 

(b) AMENDMENT TO FEDERAL CREDIT UNION ACT.-- Section 204 of the 

Federal Credit Union Act (12 U.S.C. 1784) is amended by adding at the end the 

following new subsection: 

“(e) FLOOD INSURANCE COMPLIANCE BY INSURED CREDIT UNIONS.-­

“(1) EXAMINATION.-- The Board shall, during each examination 

conducted under this section, determine whether the insured credit union is 

complying with the requirements of the national flood insurance program. 

“(2) REPORT.-­

“(A) REQUIREMENT.-- Not later than 1 year after the date of 

enactment of the Riegle Community Development and Regulatory 

Improvement Act of 1994 and biennially thereafter for the next 4 

years, the Board shall submit a report to the Congress on compliance 

by insured credit unions with the requirements of the national flood 

insurance program. 

“(B) CONTENTS.-- The report shall include a description of the 

methods used to determine compliance, the number of insured credit 

unions examined during the reporting year, a listing and total number 

of insured credit unions found not to be in compliance, 

108 STAT. 2266
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 531 

P.L. 103-325 

actions taken to correct [2267] incidents of noncompliance, and an 

analysis of compliance, including a discussion of any trends, patterns, 

and problems, and recommendations regarding reasonable actions to 

improve the efficiency of the examinations processes.”. 

(c) AMENDMENT TO FEDERAL HOUSING ENTERPRISES FINANCIAL SAFETY 

AND SOUNDNESS ACT OF 1992.-- Section 1319B(a) of the Federal Housing 

Enterprises Financial Safety and Soundness Act of 1992 (12 U.S.C. 4521(a)) is 

amended-­

(1) in paragraph (2), by striking “and” at the end; 

(2) in paragraph (3), by striking the period at the end and inserting “; 

and”; and 

(3) by adding at the end the following new paragraph: 

“(4) a description of-­

“(A) whether the procedures established by each enterprise 

pursuant to section 102(b)(3) of the Flood Disaster Protection Act of 

1973 are adequate and being complied with, and 

“(B) the results and conclusions of any examination, as 

determined necessary by the Director, to determine the compliance of 

the enterprises with the requirements of section 102(b)(3) of such Act, 

which shall include a description of the methods used to determine 

compliance and the types and sources of deficiencies (if any), and 

identify any corrective measures that have been taken to remedy any 

such deficiencies, 

except that the information described in this paragraph shall be included 

only in each of the first, third, and fifth annual reports under this subsection 

required to be submitted after the expiration of the 1-year period beginning 

on the date of enactment of the Riegle Community Development and 

Regulatory Improvement Act of 1994.”. 

SEC. 530. FINANCIAL INSTITUTIONS EXAMINATION COUNCIL. 

Section 1006 of the Federal Financial Institutions Examination Council Act 

of 1978 (12 U.S.C. 3305) is amended by adding at the end the following new 

subsection: 

“(g) FLOOD INSURANCE.-- The Council shall consult with and assist the 

Federal entities for lending regulation, as such term is defined in section 1370(a) of 

the National Flood Insurance Act of 1968, in developing and coordinating uniform 

standards and requirements for use by regulated lending institutions under the 

national flood insurance program.”. 

SEC. 531. CLERICAL AMENDMENT. 

Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 

4012a) is amended by striking the section heading and inserting the following new 

section heading: 

108 STAT. 2267
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 531 

Sept. 23 

“FLOOD INSURANCE PURCHASE AND COMPLIANCE REQUIREMENTS 

AND ESCROW ACCOUNTS”. 

Subtitle C--Ratings and Incentives for Community 

Floodplain Management Programs 

SEC. 541. COMMUNITY RATING SYSTEM AND INCENTIVES FOR 

COMMUNITY FLOODPLAIN MANAGEMENT. 

Section 1315 of the National Flood Insurance Act of 1968 (42 U.S.C. 

4022) is amended-­

(1) by striking “After December” and inserting the following: 

“(a) REQUIREMENT FOR PARTICIPATION IN FLOOD INSURANCE PROGRAM.-­

“(1) IN GENERAL.-- After December”; and 

(2) by adding at the end the following new subsection: 

“(b) COMMUNITY RATING SYSTEM AND INCENTIVES FOR COMMUNITY 

FLOODPLAIN MANAGEMENT.-­

“(1) AUTHORITY AND GOALS.-- The Director shall carry out a 

community rating system program, under which communities participate 

voluntarily-­

“(A) to provide incentives for measures that reduce the risk of 

flood or erosion damage that exceed the criteria set forth in section 

1361 and evaluate such measures; 

“(B) to encourage adoption of more effective measures that 

protect natural and beneficial floodplain functions; 

“(C) to encourage floodplain and erosion management; and 

“(D) to promote the reduction of Federal flood insurance losses. 

“(2) INCENTIVES.-- The program shall provide incentives in the form 

of credits on premium rates for flood insurance coverage in communities 

that the Director determines have adopted and enforced measures that 

reduce the risk of flood and erosion damage that exceed the criteria set 

forth in section 1361. In providing incentives under this paragraph, the 

Director may provide for credits to flood insurance premium rates in 

communities that the Director determines have implemented measures that 

protect natural and beneficial floodplain functions. 

“(3) CREDITS.-- The credits on premium rates for flood insurance 

coverage shall be based on the estimated reduction in flood and erosion 

damage risks resulting from the measures adopted by the community under 

this program. If a community has received mitigation assistance under 

section 1366, the credits shall be phased in a manner, determined by the 

Director, to recover the amount of such assistance provided for the 

community. 

“(4) REPORTS.-- Not later than 2 years after the date of enactment of 

the Riegle Community Development and Regulatory Improvement Act of 

1994 and not less than every 2 years thereafter, the Director shall submit a 

report to the Congress regarding the program under this subsection. Each 

report shall include an analysis of the cost-effectiveness of the [2269] pro108 STAT. 2268
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 552 

P.L. 103-325 

gram, any other accomplishments or shortcomings of the program, and any 

recommendations of the Director for legislation regarding the program.”. 

SEC. 542. FUNDING. 

Section 1310(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 

4017(a)) is amended-­

(1) in paragraph (4), by striking “and” at the end; 

(2) in paragraph (5), by striking the period at the end and inserting a 

semicolon; and 

(3) by adding after paragraph (5) the following new paragraph: 

“(6) for carrying out the program under section 1315(b);”. 

Subtitle D--Mitigation of Flood Risks 

SEC. 551. REPEAL OF FLOODED PROPERTY PURCHASE AND LOAN 

PROGRAM. 

(a) REPEAL.-- Section 1362 of the National Flood Insurance Act of 1968 (42 

U.S.C. 4103) is hereby repealed. 

(b) TRANSITION PHASE.-- Notwithstanding subsection (a), during the 1-year 

period beginning on the date of enactment of this Act, the Director of the Federal 

Emergency Management Agency may enter into loan and purchase commitments as 

provided under section 1362 of the National Flood Insurance Act of 1968 (as in 

effect immediately before the enactment of this Act). 

(c) SAVINGS PROVISION.-- Notwithstanding subsection (a), the Director shall 

take any action necessary to comply with any purchase or loan commitment entered 

into before the expiration of the period referred to in subsection (b) pursuant to 

authority under section 1362 of the National Flood Insurance Act of 1968 or 

subsection (b). 

SEC. 552. TERMINATION OF EROSION-THREATENED STRUCTURES 

PROGRAM. 

(a) IN GENERAL.-- Section 1306 of the National Flood Insurance Act of 1968 

(42 U.S.C. 4013) is amended by striking subsection (c). 

(b) TRANSITION PHASE.-- Notwithstanding subsection (a), during the 1-year 

period beginning on the date of enactment of this Act, the Director of the Federal 

Emergency Management Agency may pay amounts under flood insurance contracts 

for demolition or relocation of structures as provided in section 1306(c) of the 

National Flood Insurance Act of 1968 (as in effect immediately before the 

enactment of this Act). 

(c) SAVINGS PROVISION.-- Notwithstanding subsection (a), the Director shall 

take any action necessary to make payments under flood insurance contracts 

pursuant to any commitments made before the expiration of the period referred to 

in subsection (b) pursuant to the authority under section 1306(c) of the National 

Flood Insurance Act of 1968 or subsection (b). 

(d) REPEAL OF FINDINGS PROVISION.-- Section 1302 of the National Flood 

Insurance Act of 1968 (42 U.S.C. 4001) is amended by striking subsection (g). 

42 USC 4103 

note. 

42 USC 4103 

note. 

42 USC 4103 

note. 

108 STAT. 2269
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 553 

Sept. 23 

SEC. 553. MITIGATION ASSISTANCE PROGRAM. 

(a) IN GENERAL.-- Chapter III of the National Flood Insurance Act of 1968 

(42 U.S.C. 4101 et seq.), as amended by the preceding provisions of this title, is 

further amended by adding at the end the following new section: 

“MITIGATION ASSISTANCE 

42 USC 4104c. “SEC. 1366. (a) AUTHORITY.-- The Director shall carry out a program to 

provide financial assistance to States and communities, using amounts made 

available from the National Flood Mitigation Fund under section 1367, for 

planning and carrying out activities designed to reduce the risk of flood damage 

to structures covered under contracts for flood insurance under this title. Such 

financial assistance shall be made available to States and communities in the form 

of grants under subsection (b) for planning assistance and in the form of grants 

under this section for carrying out mitigation activities. 

“(b) PLANNING ASSISTANCE GRANTS.-­

“(1) IN GENERAL.-- The Director may make grants under this 

subsection to States and communities to assist in developing mitigation 

plans under subsection (c). 

“(2) FUNDING.-- Of any amounts made available from the National 

Flood Mitigation Fund for use under this section in any fiscal year, the 

Director may use not more than $1,500,000 to provide planning assistance 

grants under this subsection. 

“(3) LIMITATIONS.-­

“(A) TIMING.-- A grant under this subsection may be 

awarded to a State or community not more than once every 5 

years and each grant may cover a period of 1 to 3 years. 

“(B) SINGLE GRANTEE AMOUNT.-- A grant for planning 

assistance may not exceed-­

“(i) $150,000, to any State; or 

“(ii) $50,000, to any community. 

“(C) CUMULATIVE STATE GRANT AMOUNT.-- The sum of 

the amounts of grants made under this subsection in any fiscal 

year to any one State and all communities located in such State 

may not exceed $300,000. 

“(c) ELIGIBILITY FOR MITIGATION ASSISTANCE.-- To be eligible to receive 

financial assistance under this section for mitigation activities, a State or 

community shall develop, and have approved by the Director, a flood risk 

mitigation plan (in this section referred to as a ‘mitigation plan’), that describes 

the mitigation activities to be carried out with assistance provided under this 

section, is consistent with the criteria established by the Director under section 

1361, and provides protection against flood losses to structures for which 

contracts for flood insurance are available under this title. The mitigation plan 

shall be consistent with a comprehensive strategy for mitigation activities for the 

area affected by the mitigation plan, that has been adopted by the State or 

community following a public hearing. 

“(d) NOTIFICATION OF APPROVAL AND GRANT AWARD.-­

“(1) IN GENERAL.-- The Director shall notify a State or community 

submitting a mitigation plan of the approval or [2271] disapproval of the 

108 STAT. 2270
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 553 

P.L. 103-325 

plan not later than 120 days after submission of the plan. 

“(2) NOTIFICATION OF DISAPPROVAL.-- If the Director does not approve a 

mitigation plan submitted under this subsection, the Director shall notify, in writing, 

the State or community submitting the plan of the reasons for such disapproval. 

“(e) ELIGIBLE MITIGATION ACTIVITIES.-­

“(1) USE OF AMOUNTS.-- Amounts provided under this section (other than 

under subsection (b)) may be used only for mitigation activities specified in a 

mitigation plan approved by the Director under subsection (d). The Director shall 

provide assistance under this section to the extent amounts are available in the 

National Flood Mitigation Fund pursuant to appropriation Acts, subject only to the 

absence of approvable mitigation plans. 

“(2) DETERMINATION OF ELIGIBLE PLANS.-- The Director may approve only 

mitigation plans that specify mitigation activities that the Director determines are 

technically feasible and cost-effective and only such plans that propose activities 

that are cost-beneficial to the National Flood Mitigation Fund. 

“(3) STANDARD FOR APPROVAL.-- The Director shall approve mitigation 

plans meeting the requirements for approval under paragraph (1) that will be most 

cost-beneficial to the National Flood Mitigation Fund. 

“(4) PRIORITY.-- The Director shall make every effort to provide mitigation 

assistance under this section for mitigation plans proposing activities for repetitive 

loss structures and structures that have incurred substantial damage. 

“(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) demolition or relocation of any structure located on land that is 

along the shore of a lake or other body of water and is certified by an 

appropriate State or local land use authority to be subject to imminent 

collapse or subsidence as a result of erosion or flooding; 

“(B) elevation, relocation, demolition, or floodproofing of structures 

(including public structures) located in areas having special flood hazards or 

other areas of flood risk; 

“(C) acquisition by States and communities of properties (including 

public properties) located in areas having special flood hazards or other areas 

of flood risk and properties substantially damaged by flood, for public use, as 

the Director determines is consistent with sound land management and use in 

such area; 

“(D) minor physical mitigation efforts that do not duplicate the flood 

prevention activities of other Federal agencies and that lessen the frequency 

or severity of flooding and decrease predicted flood damages, which shall not 

include major flood control projects such as dikes, levees, seawalls, groins, 

and jetties unless the Director specifically determines in approving a 

mitigation plan that such activities are the most cost-effective mitigation 

activities for the National Flood Mitigation Fund; 

“(E) beach nourishment activities; 

108 STAT. 2271
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 553 

Sept. 23 

“(F) the provision of technical assistance by States to 

communities and individuals to conduct eligible mitigation activities; 

“(G) other activities that the Director considers appropriate and 

specifies in regulation; and 

“(H) other mitigation activities not described in subparagraphs 

(A) through (F) or the regulations issued under subparagraph (G), 

that are described in the mitigation plan of a State or community. 

“(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) MATCHING REQUIREMENT.-­

“(1) IN GENERAL.-- The Director may not provide mitigation 

assistance under this section to a State or community in an amount 

exceeding 3 times the amount that the State or community certifies, as the 

Director shall require, that the State or community will contribute from 

non-Federal funds to develop a mitigation plan under subsection (c) and to 

carry out mitigation activities under the approved mitigation plan. In no 

case shall any in-kind contribution by any State or community exceed onehalf of the amount of non-Federal funds contributed by the State or 

community. 

“(2) NON-FEDERAL FUNDS.-- For purposes of this subsection, the 

term ‘non-Federal funds’ includes State or local agency funds, in-kind 

contributions, any salary paid to staff to carry out the mitigation activities 

of the recipient, the value of the time and services contributed by 

volunteers to carry out such activities (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. 

“(h) 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) are used in accordance with such certification. 

“(i) RECAPTURE.-­

“(1) NONCOMPLIANCE WITH PLAN.-- If the Director determines that a 

State or community that has received mitigation assistance under this 

section has not carried out the mitigation activities as set forth in the 

mitigation plan, the Director shall recapture [2273] any unexpended 

108 STAT. 2272
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 554 

P.L. 103-325 

amounts and deposit the amounts in the National Flood Mitigation Fund 

under section 1367 

“(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), 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) 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) DEFINITION OF COMMUNITY.-- For purposes of this section, the term 

‘community’ means-­

“(1) a political subdivision that (A) has zoning and building code 

jurisdiction over a particular area having special flood hazards, and (B) is 

participating in the national flood insurance program; or 

“(2) a political subdivision of a State, or other authority, that is 

designated to develop and administer a mitigation plan by political 

subdivisions, all of which meet the requirements of paragraph (1).”. 

(b) REGULATIONS.-- Not later than 6 months after the date of enactment of 

this Act, the Director of the Federal Emergency Management Agency shall issue 

regulations to carry out section 1366 of the National Flood Insurance Act of 1968, 

as added by subsection (a). 

SEC. 554. ESTABLISHMENT OF NATIONAL FLOOD MITIGATION 

FUND. 

(a) IN GENERAL.-- Chapter III of the National Flood Insurance Act of 1968 

(42 U.S.C. 4101 et seq.), as amended by the preceding provisions of this title, is 

further amended by adding at the end the following new section: 

“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. 

“(b) CREDITS.-- The National Flood Mitigation Fund shall be credited with­

“(1) amounts from the National Flood Insurance Fund, in amounts not 

exceeding-­

“(A) $10,000,000 in the fiscal year ending September 30, 1994; 

“(B) $15,000,000 in the fiscal year ending September 30, 1995; 

“(C) $20,000,000 in the fiscal year ending September 30, 1996; 

and 

“(D) $20,000,000 in each fiscal year thereafter; 

“(2) any penalties collected under section 102(f) of the Flood Disaster 

Protection Act of 1973; and 

42 USC 4104c 

note. 

42 USC 4104d 

note. 

108 STAT. 2273
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 554 

Sept. 23 

“(3) any amounts recaptured under section 1366(i). 

“(c) INVESTMENT.-- If the Director determines that the amounts in the 

National Flood Mitigation Fund are in excess of amounts needed under subsection 

(a), the Director may invest any excess amounts the Director determines advisable 

in interest-bearing obligations issued or guaranteed by the United States. 

“(d) REPORT.-- The Director shall submit a report to the Congress not later 

than the expiration of the 1-year period beginning on the date of enactment of this 

Act and not less than once during each successive 2-year period thereafter. The 

report shall describe the status of the Fund and any activities carried out with 

amounts from the Fund.”. 

(b) NATIONAL FLOOD INSURANCE FUND AS SEPARATE ACCOUNT.-- Section 

1310(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 4017(a)) is 

amended-­

(1) in the matter preceding paragraph (1)--

(A) by striking “is authorized to” and inserting “shall”; and 

(B) by inserting after “which shall be” the following: “an account 

separate from any other accounts or funds available to the Director and 

shall be”; and 

(2) by adding after paragraph (6) (as added by the preceding provisions 

of this title) the following new paragraph: 

“(7) for transfers to the National Flood Mitigation Fund, but only to the 

extent provided in section 1367(b)(1); and”. 

SEC. 555. ADDITIONAL COVERAGE FOR COMPLIANCE WITH LAND 

USE AND CONTROL MEASURES. 

(a) IN GENERAL.-- Section 1304 of the National Flood Insurance Act of 1968 

(42 U.S.C. 4011) is amended-­

(1) by redesignating subsection (b) as subsection (c); and 

(2) by inserting after subsection (a) the following new subsection: 

“(b) ADDITIONAL COVERAGE FOR COMPLIANCE WITH LAND USE AND 

CONTROL MEASURES.-- The national flood insurance program established pursuant 

to subsection (a) shall enable the purchase of insurance to cover the cost of 

compliance with land use and control measures established under section 1361 for­

-

“(1) properties that are repetitive loss structures; 

“(2) properties that have flood damage in which the cost of repairs 

equals or exceeds 50 percent of the value of the structure at the time of the 

flood event; and 

“(3) properties that have sustained flood damage on multiple occasions, 

if the Director determines that it is cost-effective and in the best interests of 

the National Flood Insurance Fund to require compliance with the land use 

and control measures. 

The Director shall impose a surcharge on each insured of not more than $75 per 

policy to provide cost of compliance coverage in accordance with the provisions 

of this subsection.”. 

42 USC 4011 (b) APPLICABILITY.-- The provisions of subsection (a) shall apply only to 

note. properties that sustain flood-related damage after the date of enactment of this 

Act. 

108 STAT. 2274
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 561 

P.L. 103-325 

Subtitle E--Task Forces 

SEC. 561. FLOOD INSURANCE INTERAGENCY TASK FORCE. 

(a) ESTABLISHMENT.-- There is hereby established an interagency task force 

to be known as the Flood Insurance Task Force (in this section referred to as the 

“Task Force”). 

(b) MEMBERSHIP.-­

(1) IN GENERAL.-- The Task Force shall be composed of 10 members, 

who shall be the designees of-­

(A) the Federal Insurance Administrator; 

(B) the Federal Housing Commissioner; 

(C) the Secretary of Veterans Affairs; 

(D) the Administrator of the Farmers Home Administration; 

(E) the Administrator of the Small Business Administration; 

(F) the Chairman of the Board of Directors of the Farm Credit 

Administration; 

(G) a designee of the Financial Institutions Examination Council; 

(H) the Director of the Office of Federal Housing Enterprise 

Oversight; 

(I) the chairman of the Board of Directors of the Federal Home 

Loan Mortgage Corporation; and 

(J) the chairman of the Board of Directors of the Federal National 

Mortgage Association. 

(2) QUALIFICATIONS.-- Members of the Task Force shall be designated 

for membership on the Task Force by reason of demonstrated knowledge and 

competence regarding the national flood insurance program. 

(c) DUTIES.-- The Task Force shall carry out the following duties: 

(1) RECOMMENDATIONS OF STANDARDIZED ENFORCEMENT PROCEDURES.-- Make recommendations to the head of each Federal agency and 

enterprise referred to under subsection (b)(1) regarding establishment or 

adoption of standardized enforcement procedures among such agencies and 

corporations responsible for enforcing compliance with the requirements 

under the national flood insurance program to ensure fullest possible 

compliance with such requirements. 

(2) STUDY OF COMPLIANCE ASSISTANCE.-- Conduct a study of the 

extent to which Federal agencies and the secondary mortgage market can 

provide assistance in ensuring compliance with the requirements under the 

national flood insurance program and submit to the Congress a report 

describing the study and any conclusions. 

(3) STUDY OF COMPLIANCE MODEL.-- Conduct a study of the extent to 

which existing programs of Federal agencies and corporations for compliance 

with the requirements under the national flood insurance program can serve as 

a model for other Federal agencies responsible for enforcing compliance, and 

submit to the Congress a report describing the study and any conclusions. 

(4) RECOMMENDATIONS FOR ENFORCEMENT AND COMPLIANCE 

PROCEDURES.-- Develop recommendations regarding enforcement [2276] and 

42 USC 4011 

note. 

108 STAT. 2275
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 561 

Sept. 23 

compliance procedures, based on the studies and findings of the Task 

Force, and publish such recommendations 

(5) STUDY OF DETERMINATION FEES.-- Conduct a study of-­

(A) the reasonableness of fees charged pursuant to 102(h) of 

the Flood Disaster Protection Act of 1973 for costs of determining 

whether the property securing a loan is located in an area having 

special flood hazards; and 

(B) whether the fees charged pursuant to such section by 

lenders and servicers are greater than the amounts paid by such 

lenders and servicers to persons actually conducting such 

determinations and the extent to which the fees exceed such amounts. 

(d) NONCOMPENSATION.-- Members of the Task Force shall receive no 

additional pay by reason of their service on the Task Force. 

(e) CHAIRPERSON.-- The members of the Task Force shall elect one 

member as chairperson of the Task Force. 

(f) MEETINGS AND ACTION.-- The Task Force shall meet at the call of the 

chairman or a majority of the members of the Task Force and may take action by 

a vote of the majority of the members. The Federal Insurance Administrator shall 

coordinate and call the initial meeting of the Task Force. 

(g) OFFICERS.-- The chairperson of the Task Force may appoint any 

officers to carry out the duties of the Task Force under subsection (c). 

(h) STAFF OF FEDERAL AGENCIES.-- Upon request of the chairperson of the 

Task Force, the head of any of the Federal agencies and entities referred to 

under subsection (b)(1) may detail, on a nonreimbursable basis, any of the 

personnel of such agency to the Task Force to assist the Task Force in carrying 

out its duties under this section. 

(i) POWERS.-- In carrying out this section, the Task Force may hold 

hearings, sit and act at times and places, take testimony, receive evidence and 

assistance, provide information, and conduct research as the Task Force 

considers appropriate. 

(j) TERMINATION.-- The Task Force shall terminate upon the expiration of 

the 24-month period beginning upon the designation of the last member to be 

designated under subsection (b)(1). 

42 USC 4102 SEC. 562. TASK FORCE ON NATURAL AND BENEFICIAL 

note. FUNCTIONS OF THE FLOODPLAIN. 

(a) ESTABLISHMENT.-- There is hereby established an interagency task 

force to be known as the Task Force on Natural and Beneficial Functions of the 

Floodplain (in this section referred to as the “Task Force”). 

(b) MEMBERSHIP.-- The Task Force shall be composed of 5 members, who 

shall be the designees of-­

(1) the Under Secretary of Commerce for Oceans and Atmosphere; 

(2) the Director of the United States Fish and Wildlife Service; 

(3) the Administrator of the Environmental Protection Agency; 

(4) the Secretary of the Army, acting through the Chief of Engineers; 

and 

(5) the Director of the Federal Emergency Management Agency. 

108 STAT. 2276
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 572 

P.L. 103-325 

(c) DUTIES.-- The Task Force shall-­

(1) conduct a study to-­

(A) identify the natural and beneficial functions of the floodplain 

that reduce flood-related losses; and 

(B) develop recommendations on how to reduce flood losses by 

protecting the natural and beneficial functions of the floodplain; and 

(2) make the information and recommendations under subparagraphs 

(A) and (B) publicly available. 

(d) NONCOMPENSATION.-- Members of the Task Force shall receive no 

additional pay by reason of their service on the Task Force. 

(e) CHAIRPERSON.-- The members of the Task Force shall elect one member 

as chairperson of the Task Force. 

(f) MEETINGS AND ACTION.-- The Task Force shall meet at the call of the 

chairperson or a majority of the members of the Task Force and may take action by 

a vote of the majority of the members. The Federal Insurance Administrator shall 

coordinate and call the initial meeting of the Task Force. 

(g) OFFICERS.-- The chairperson of the Task Force may appoint any officers 

to carry out the duties of the Task Force under subsection (c). 

(h) STAFF OF FEDERAL AGENCIES.-- Upon request of the chairperson of the 

Task Force, the head of any of the Federal agencies and entities referred to under 

subsection (b) may detail, on a nonreimbursable basis, any of the personnel of such 

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

this section. 

(i) POWERS.-- In carrying out this section, the Task Force may hold hearings, 

sit and act at times and places, take testimony, receive evidence and assistance, 

provide information, and conduct research as the Task Force considers appropriate. 

(j) TERMINATION.-- The Task Force shall terminate upon the expiration of the 

24-month period beginning upon the designation of the last member to be 

designated under subsection (b). 

Subtitle F--Miscellaneous Provisions 

SEC. 571. EXTENSION OF FLOOD INSURANCE PROGRAM. 

(a) IN GENERAL.-- Section 1319 of the National Flood Insurance Act of 1968 

(42 U.S.C. 4026) is amended by striking “September 30, 1995” and inserting 

“September 30, 1996”. 

(b) EMERGENCY IMPLEMENTATION.-- Section 1336(a) of the National Flood 

Insurance Act of 1968 (42 U.S.C. 4056(a)) is amended by striking “September 30, 

1995” and inserting “September 30, 1996”. 

SEC. 572. LIMITATION ON PREMIUM INCREASES. 

(a) PROPERTY-SPECIFIC LIMITATION.-- Section 1308 of the National Flood 

Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended-­

(1) in subsection (c), by striking “Notwithstanding any other provision 

of this title” and inserting “Subject only to the limitation under subsection 

(e)”; and 

(2) by inserting after subsection (d) the following new subsection: 

42 USC 4015.

108 STAT. 2277
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 572 

Sept. 23 

“(e) ANNUAL LIMITATION ON PREMIUM INCREASES.-- 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 of the average of the risk premium rates for properties within the risk 

classification upon the commencement of such 12-month period.”. 

(b) REPEAL OF PROGRAM-WIDE LIMITATION.-- Subsection (d) of section 541 

of the Housing and Community Development Act of 1987 (42 U.S.C. 4015 note) 

is hereby repealed. 

SEC. 573. MAXIMUM FLOOD INSURANCE COVERAGE AMOUNTS. 

(a) IN GENERAL.-- Section 1306(b) of the National Flood Insurance Act of 

1968 (42 U.S.C. 4013(b)) is amended as follows: 

(1) RESIDENTIAL PROPERTY.-- In paragraph (2), by striking “an amount 

of $150,000 under the provisions of this clause” and inserting the following: 

“a total amount (including such limits specified in paragraph (1)(A)(i)) of 

$250,000”. 

(2) RESIDENTIAL PROPERTY CONTENTS.-- In paragraph (3), by striking 

“an amount of $50,000 under the provisions of this clause” and inserting the 

following: “a total amount (including such limits specified in paragraph 

(1)(A)(ii)) of $100,000”. 

(3) NONRESIDENTIAL PROPERTY AND CONTENTS.-- By striking 

paragraph (4) and inserting the following new paragraph: 

“(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 for each structure and $500,000 for any contents related to each 

structure; and”. 

(b) REMOVAL OF CEILING ON COVERAGE REQUIRED.-- Section 1306(b) of 

the National Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended-­

(1) in paragraph (5), by striking “; and” at the end and inserting a 

period; and 

(2) by striking paragraph (6). 

SEC. 574. FLOOD INSURANCE PROGRAM ARRANGEMENTS WITH 

PRIVATE INSURANCE ENTITIES. 

Section 1345(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 

4081(b)) is amended by striking the period at the end and inserting the following: 

“and without regard to the provisions of the Federal Advisory Committee Act (5 

U.S.C. App.).”. 

SEC. 575. UPDATING OF FLOOD MAPS. 

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 subsections: 

“(e) REVIEW OF FLOOD MAPS.-- Once during each 5-year period (the1st such 

108 STAT. 2278
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT P.L. 103-325 

Sec. 575 

period beginning on the date of enactment of the Riegle Community Development 

and Regulatory Improvement Act of 1994) or more often as the Director 

determines necessary, the Director [2279] shall assess the need to revise and update 

all floodplain areas and flood risk zones identified, delineated, or established under 

this section, based on an analysis of all natural hazards affecting flood risks. 

“(F) UPDATING FLOOD MAPS.-- The Director shall revise and update any 

floodplain areas and flood-risk zones-­

“(1) upon the determination of the Director, according to the 

assessment under subsection (e), that revision and updating are necessary for 

the areas and zones; or 

“(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. 

“(g) AVAILABILITY OF FLOOD MAPS.-- To promote compliance with the 

requirements of this title, the Director shall make flood insurance rate maps and 

related information available free of charge to the Federal entities for lending 

regulation, Federal agency lenders, State agencies directly responsible for 

coordinating the national flood insurance program, and appropriate representatives 

of communities participating in the national flood insurance program, and at a 

reasonable cost to all other persons. Any receipts resulting from this subsection 

shall be deposited in the National Flood Insurance Fund, pursuant to section 

1310(b)(6). 

“(h) NOTIFICATION OF FLOOD MAP CHANGES.-- The Director shall cause 

notice to be published in the Federal Register (or shall provide notice by another 

comparable method) of any change to flood insurance map panels and any change 

to flood insurance map panels issued in the form of a letter of map amendment or a 

letter of map revision. Such notice shall be published or otherwise provided not 

later than 30 days after the map change or revision becomes effective. Notice by 

any method other than publication in the Federal Register shall include all pertinent 

information, provide for regular and frequent distribution, and be at least as 

accessible to map users as notice in the Federal Register. All notices under this 

subsection shall include information on how to obtain copies of the changes or 

revisions. 

“(i) COMPENDIA OF FLOOD MAP CHANGES.-- Every 6 months, the Director 

shall publish separately in their entirety within a compendium, all changes and 

revisions to flood insurance map panels and all letters of map amendment and 

letters of map revision for which notice was published in the Federal Register or 

otherwise provided during the preceding 6 months. The Director shall make such 

compendia available, free of charge, to Federal entities for lending regulation, 

Federal agency lenders, and States and communities participating in the national 

flood insurance program pursuant to section 1310 and at cost to all other parties. 

Any receipts resulting from this subsection shall be deposited in the National Flood 

Insurance Fund, pursuant to section 1310(b)(6). 

“(j) PROVISION OF INFORMATION.-- In the implementation of revisions to and 

updates of flood insurance rate maps, the Director shall share information, to the 

extent appropriate, with the Under Secretary of Commerce for Oceans and 

Atmosphere and representatives from State coastal zone management programs.”. 

Federal 

Register, 

publication. 

Public 

information. 

108 STAT. 2279
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 576 

Sept. 23 

42 USC 4101 

note. 

Reports. 

SEC. 576. TECHNICAL MAPPING ADVISORY COUNCIL. 

(a) ESTABLISHMENT.-- There is established a council to be known as the 

Technical Mapping Advisory Council (in this section referred to as the 

“Council”). 

(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 additional members to be 

appointed by the Director or the designee of the Director, who shall be-­

(A) the Under Secretary of Commerce for Oceans and 

Atmosphere (or his or her designee); 

(B) a member of recognized surveying and mapping 

professional associations and organizations; 

(C) a member of recognized professional engineering 

associations and organizations; 

(D) a member of recognized professional associations or 

organizations representing flood hazard determination firms; 

(E) a representative of the United States Geologic Survey; 

(F) a representative of State geologic survey programs; 

(G) a representative of State national flood insurance 

coordination offices; 

(H) a representative of a regulated lending institution; 

(I) a representative of the Federal Home Loan Mortgage 

Corporation; and 

(J) a representative of the Federal National Mortgage 

Association. 

(2) QUALIFICATIONS.-- Members of the Council shall be appointed 

based on their demonstrated knowledge and competence regarding 

surveying, cartography, remote sensing, geographic information systems, 

or the technical aspects of preparing and using flood insurance rate maps. 

(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. 

(d) CHAIRPERSON.-- The members of the Council shall elect 1 member to 

serve as the chairperson of the Council (in this section referred to as the 

“Chairperson”). 

(e) COORDINATION.-- To ensure that the Council’s recommendations are 

consistent to the maximum extent practicable with national digital spatial data 

collection and management standards, the Chairperson shall consult with the 

108 STAT. 2280
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 577 

P.L. 103-325 

Chairperson of the Federal [2281] Geographic Data Committee (established 

pursuant to OMB Circular A-16). 

(f) COMPENSATION.-- Members of the Council shall receive no additional 

compensation by reason of their service on the Council. 

(g) MEETINGS AND ACTIONS.-­

(1) IN GENERAL.-- The Council shall meet not less than twice each year 

at the request of the Chairperson or a majority of its members and may take 

action by a vote of the majority of the members. 

(2) INITIAL MEETING.-- The Director, or a person designated by the 

Director, shall request and coordinate the initial meeting of the Council. 

(h) OFFICERS.-- The Chairperson may appoint officers to assist in carrying 

out the duties of the Council under subsection (c). 

(i) STAFF OF FEMA.-- Upon the request of the Chairperson, the Director may 

detail, on a nonreimbursable basis, personnel of the Federal Emergency 

Management Agency to assist the Council in carrying out its duties. 

(j) POWERS.-- In carrying out this section, the Council may hold hearings, 

receive evidence and assistance, provide information, and conduct research as it 

considers appropriate. 

(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). 

SEC. 577. EVALUATION OF EROSION HAZARDS. 

(a) REPORT REQUIREMENT.-- The Director of the Federal Emergency 

Management Agency (in this section referred to as the “Director”) shall submit a 

report under this section to the Congress that-­

(1) lists all communities that are likely to be identified as having erosion 

hazard areas; 

(2) estimates the amount of flood insurance claims under the national 

flood insurance program that are attributable to erosion; 

(3) states the amount of flood insurance claims under such program that 

are attributable to claims under section 1306(c) of the National Flood 

Insurance Act of 1968; 

(4) assesses the full economic impact of erosion on the National Flood 

Insurance Fund; and 

(5) determines the costs and benefits of expenditures necessary from the 

National Flood Insurance Fund to complete mapping of erosion hazard areas. 

(b) ESTIMATE OF FLOOD CLAIMS.-- In developing the estimate under 

subsection (a)(2)--

(1) the Director may map a statistically valid and representative number 

of communities with erosion hazard areas throughout the United States, 

including coastal, Great Lakes, and, if technologically feasible, riverine areas; 

and 

(2) the Director shall take into consideration the efforts of State and 

local governments to assess, measure, and reduce erosion hazards. 

(c) ECONOMIC IMPACT.-­

(1) IN GENERAL.-- The assessment under subsection (a)(4) shall assess 

the economic impact of-­

(A) erosion on communities listed pursuant to subsection (a)(1); 

42 USC 4001 

note. 

108 STAT. 2281
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 577 

Sept. 23 

(B) the denial of flood insurance for all structures in 

communities listed pursuant to subsection (a)(1); 

(C) the denial of flood insurance for structures that are newly 

constructed in whole in communities listed pursuant to subsection 

(a)(1); 

(D) the establishment of (i) actuarial rates for existing structures 

in communities listed pursuant to subsection (a)(1), and (ii) actuarial 

rates for such structures in connection with the denial of flood 

insurance as described in subparagraph (C); 

(E) the establishment of actuarial rates for structures newly 

constructed in whole in erosion hazard areas in communities listed 

pursuant to subsection (a)(1); 

(F) the denial of flood insurance pursuant to existing 

requirements for coverage under the national flood insurance 

program; 

(G) erosion hazard assessment, measurement, and management 

activities undertaken by State and local governments, including 

building restrictions, beach nourishment, construction of sea walls 

and levees, and other activities that reduce the risk of damage due to 

erosion; and 

(H) the mapping and identifying of communities (or 

subdivisions thereof) having erosion hazard areas. 

(2) SCOPE.-- In assessing the economic impact of the activities under 

subparagraphs (A) through (H) of paragraph (1), the assessment under 

subsection (a)(4) shall address such impact on all significant economic 

factors, including the impact on-­

(A) the value of residential and commercial properties in 

communities with erosion hazards; 

(B) community tax revenues due to potential changes in 

property values or commercial activity; 

(C) employment, including the potential loss or gain of existing 

and new jobs in the community; 

(D) existing businesses and future economic development; 

(E) the estimated cost of Federal and State disaster assistance 

to flood victims; and 

(F) the mapping and identifying of communities (or subdivisions 

thereof) having erosion hazard areas. 

(3) PREPARATION.-- The assessment required under subsection (a)(4) 

shall be conducted by a private independent entity selected by the Director. 

The private entity shall consult with a statistically valid and representative 

number of communities listed pursuant to subsection (a)(1) in conducting 

the assessment. 

(d) COSTS AND BENEFITS OF MAPPING.-- The determination under 

subsection (a)(5) shall-­

(1) determine the costs and benefits of mapping erosion hazard areas, 

based upon the Director’s estimate of the actual and prospective amount of 

flood insurance claims attributable to erosion; 

(2) if the Director determines that the savings to the National Flood 

Insurance Fund will exceed the cost of mapping erosion hazard areas, 

further assess whether using flood insurance premiums for costs of 

108 STAT. 2282
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 577 

P.L. 103-325 

mapping erosion hazard areas is [2283] cost-beneficial compared to alternative uses of such amounts, including-­

(A) funding the mitigation assistance program under section 1366 

of the National Flood Insurance Act of 1968 (as added by section 553 

of this Act); 

(B) funding the program under section 1304(b) of the National 

Flood Insurance Act of 1968 (as added by section 555(a) of this Act) 

that provides additional coverage under the national flood insurance 

program for compliance with land use and control measures; and 

(C) reviewing, revising, and updating flood insurance rate maps 

under subsections (e) and (f) of section 1360 of the National Flood 

Insurance Act of 1968 (as added by the amendment made by section 

575 of this Act); 

(3) if the Director determines under subsection (b)(1) that mapping of 

riverine areas for erosion hazard areas is technologically feasible, determine 

the costs and benefits of conducting the mapping of erosion hazards in 

riverine areas (A) separately from the mapping of other erosion hazard areas, 

and (B) together with the mapping of other such areas; 

(4) if the Director determines that the savings to the National Flood 

Insurance Fund will exceed the cost of mapping erosion hazard areas in 

riverine areas, assess whether using flood insurance premiums for costs of 

mapping erosion hazard areas in riverine areas is cost-beneficial compared to 

alternative uses of such amounts, including the uses under subparagraphs (A) 

through (C) of paragraph (2); and 

(5) determine the costs and benefits of mapping erosion, other than 

those directly related to the financial condition of the National Flood 

Insurance Program, and the costs of not mapping erosion. 

(e) DEFINITION.-- For purposes of this section, the term “erosion hazard area” 

means, based on erosion rate information and other historical data available, an area 

where erosion or avulsion is likely to result in damage to or loss of buildings and 

infrastructure within a 60-year period. 

(f) CONSULTATION.-- In preparing the report under this section, the Director 

shall consult with-­

(1) representatives from State coastal zone management programs 

approved under section 306 of the Coastal Zone Management Act of 1972; 

(2) the Administrator of the National Oceanic and Atmospheric 

Administration; and 

(3) any other persons, officials, or entities that the Director considers 

appropriate. 

(g) SUBMISSION.-- The Director shall submit the report to the Congress as 

soon as practicable, but not later than 2 years after the date of enactment of this 

Act. 

(h) AVAILABILITY OF NATIONAL FLOOD INSURANCE FUND.-- Section 1310(a) 

of the National Flood Insurance Act of 1968 (42 U.S.C. 4017(a)) is amended-­

(1) in the matter preceding paragraph (1), by inserting “(except as 

otherwise provided in this section)” after “without fiscal year limitation”; 

and 

(2) by inserting after paragraph (7) (as added by the preceding 

provisions of this title) the following new paragraph: 

Reports. 

108 STAT. 2283
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 577 

Sept. 23 

“(8) for costs of preparing the report under section 577 of the Riegle 

Community Development and Regulatory Improvement Act of 1994, except that 

the fund shall be available for the purpose under this paragraph in an amount not 

to exceed an aggregate of $5,000,000 over the 2-year period beginning on the date 

of enactment of the Riegle Community Development and Regulatory Improvement 

Act of 1994.”. 

42 USC 4014 SEC. 578. STUDY OF ECONOMIC EFFECTS OF CHARGING 

note. 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 pre-FIRM 

structures 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 and homeowners. 

(b) DEFINITION OF PRE-FIRM STRUCTURE.-- For purposes of subsection (a), 

the term “pre-FIRM structure” means a structure that was not constructed or 

substantially improved after the later of-­

(1) December 31, 1974; or 

(2) the effective date of the initial rate map published by the Director 

under section 1360(a)(2) of the National Flood Insurance Act of 1968 for the 

area in which such structure is located. 

(c) 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 enactment of this Act. 

SEC. 579. EFFECTIVE DATES OF POLICIES. 

(a) 30-DAY DELAY.-- Section 1306 of the National Flood Insurance Act of 

1968 (42 U.S.C. 4013), as amended by the preceding provisions of this title, is 

further amended by adding at the end the following new subsection: 

“(c) EFFECTIVE DATE OF POLICIES­

“(1) WAITING PERIOD.-- Except as provided in paragraph (2), coverage 

under a new contract for flood insurance coverage under this title entered 

into after the date of enactment of the Riegle Community Development and 

Regulatory Improvement Act of 1994, and any modification to coverage 

under an existing flood insurance contract made after such date, shall become 

effective upon the expiration of the 30-day period [2285] beginning 

108 STAT. 2284
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 580 

P.L. 103-325 

on the date that all obligations for such coverage (including completion of 

the application and payment of any initial premiums owed) are satisfactorily 

completed. 

“(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 

“(B) the initial purchase of flood insurance coverage pursuant to a 

revision or updating of floodplain areas or flood-risk zones under 

section 1360(f), if such purchase occurs during the 1-year period 

beginning upon publication of notice of the revision or updating under 

section 1360(h).”. . 

(b) STUDY.-- The Director of the Federal Emergency Management Agency 

shall conduct a study to determine the appropriateness of existing requirements 

regarding the effective date and time of coverage under flood insurance contracts 

obtained through the national flood insurance program. In conducting the study, 

the Director shall determine whether any delay between the time of purchase of 

flood insurance coverage and the time of initial effectiveness of the coverage 

should differ for various classes of properties (based upon the type of property, 

location of the property, or any other factors related to the property) or for 

various circumstances under which such insurance was purchased. Not later than 

the expiration of the 6-month period beginning on the date of enactment of this 

Act, the Director shall submit to the Congress a report on the results of the study. 

SEC. 580. AGRICULTURAL STRUCTURES. 

Section 1315(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 

4022(a)), as amended by the preceding provisions of this title, is further amended 

by adding at the end the following new paragraph: 

“(2) AGRICULTURAL STRUCTURES.-­

“(A) ACTIVITY RESTRICTIONS.-- Notwithstanding any other 

provision of law, the adequate land use and control measures required 

to be adopted in an area (or subdivision thereof) pursuant to paragraph 

(1) may provide, at the discretion of the appropriate State or local 

authority, for the repair and restoration to predamaged conditions of an 

agricultural structure that-­

“(i) is a repetitive loss structure; or 

“(ii) has incurred flood-related damage to the extent that the 

cost of restoring the structure to its predamaged condition would 

equal or exceed 50 percent of the market value of the structure 

before the damage occurred. 

“(B) PREMIUM RATES AND COVERAGE.-- To the extent 

applicable, an agricultural structure repaired or restored pursuant to 

subparagraph (A) shall pay chargeable premium rates established under 

section 1308 at the estimated risk premium rates under section 

1307(a)(1). If resources are available, the Director shall provide 

technical assistance and counseling, upon request of the owner of the 

structure, regarding wet flood-proofing and other flood damage 

reduction measures for agricultural structures. The [2286] Director 

Reports. 

108 STAT. 2285
P.L. 103-325 LAWS OF 103rd CONG - 2nd SESS. 

Sec. 580 

Sept. 23 

shall not be required to make flood insurance coverage available for such 

an agricultural structure unless the structure is wet flood-proofed through 

permanent or contingent measures applied to the structure or itscontents 

that prevent or provide resistance to damage from flooding by allowing 

flood waters to pass through the structure, as determined by the Director. 

“(C) PROHIBITION ON DISASTER RELIEF.-- Notwithstanding any other 

provision of law, any agricultural structure repaired or restored pursuant to 

subparagraph (A) shall not be eligible for disaster relief assistance under 

any program administered by the Director or any other Federal agency. 

“(D) DEFINITIONS.-- For purposes of this paragraph-­

“(i) the term ‘agricultural structure’ means any structure used 

exclusively in connection with the production, harvesting, storage, 

raising, or drying of agricultural commodities; and 

“(ii) the term ‘agricultural commodities’ means agricultural 

commodities and livestock.”. 

SEC. 581. IMPLEMENTATION REVIEW BY DIRECTOR. 

Section 1320 of the National Flood Insurance Act of 1968 (42 U.S.C. 

4027) is amended-­

(1) by striking “The Director” and inserting “(a) IN GENERAL.-- The 

Director”; and 

(2) by adding at the end the following new subsection: 

Reports. “(b) EFFECTS OF FLOOD INSURANCE PROGRAM.-- The Director shall 

include, as part of the biennial 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.”. 

42 USC 5154a. SEC. 582. PROHIBITED FLOOD DISASTER ASSISTANCE. 

(a) GENERAL PROHIBITION.-- Notwithstanding any other provision of law, 

no Federal disaster relief assistance made available in a flood disaster area may 

be used to make a payment (including any loan assistance payment) to a person 

for repair, replacement, or restoration for damage to any personal, residential, or 

commercial property if that person at any time has received flood disaster 

assistance that was conditional on the person first having obtained flood 

insurance under applicable Federal law and subsequently having failed to obtain 

and maintain flood insurance as required under applicable Federal law on such 

property. 

(b) TRANSFER OF PROPERTY.-­

(1) DUTY TO NOTIFY.-- In the event of the transfer of any property 

described in paragraph (3), the transferor shall, not later than the date on 

which such transfer occurs, notify the transferee in writing of the 

requirements to-­

(A) obtain flood insurance in accordance with applicable Federal 

law with respect to such property, if the property is not so insured as 

of the date on which the property is transferred; and 

(B) maintain flood insurance in accordance with applicable 

Federal law with respect to such property. 

Such written notification shall be contained in documents evidencing the 

transfer of ownership of the property. 

108 STAT. 2286
Sept.23 RIEGLE COMMUNITY DEVELOPMENT ACT 

Sec. 584 

P.L. 103-325 

(2) FAILURE TO NOTIFY.-- If a transferor described in paragraph (1) fails 

to make a notification in accordance with such paragraph and, subsequent to 

the transfer of the property-­

(A) the transferee fails to obtain or maintain flood insurance in 

accordance with applicable Federal law with respect to the property, 

(B) the property is damaged by a flood disaster, and 

(C) Federal disaster relief assistance is provided for the repair, 

replacement, or restoration of the property as a result of such damage, 

the transferor shall be required to reimburse the Federal 

Government in an amount equal to the amount of the Federal disaster 

relief assistance provided with respect to the property. 

(3) PROPERTY DESCRIBED.-- For purposes of paragraph (1), a property 

is described in this paragraph if it is personal, commercial, or residential

property for which Federal disaster relief assistance made available in a flood

disaster area has been provided, prior to the date on which the property is

transferred, for repair, replacement, or restoration of the property, if such

assistance was conditioned upon obtaining flood insurance in accordance with

applicable Federal law with respect to such property.

(c) AMENDMENT TO THE FLOOD DISASTER PROTECTION ACT OF 1973.--

Section 102(a) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(a)) 

is amended-­

(1) by striking “, during the anticipated economic or useful life of the 

project,”; and 

(2) by adding at the end the following: “The requirement of maintaining 

flood insurance shall apply during the life of the property, regardless of 

transfer of ownership of such property.”. 

(d) DEFINITION.-- For purposes of this section, the term “flood disaster area” 

means an area with respect to which-­

(1) the Secretary of Agriculture finds, or has found, to have been 

substantially affected by a natural disaster in the United States pursuant to 

section 321(a) of the Consolidated Farm and Rural Development Act (7 

U.S.C. 1961(a)); or 

(2) the President declares, or has declared, the existence of a major 

disaster or emergency pursuant to the Robert T. Stafford Disaster Relief and 

Emergency Assistance Act (42 U.S.C. 5121 et seq.), as a result of flood 

conditions existing in or affecting that area. 

(e) EFFECTIVE DATE.-- This section and the amendments made by this section 

shall apply to disasters declared after the date of enactment of this Act. 

SEC. 583. REGULATIONS. 

The Director of the Federal Emergency Management Agency and any 

appropriate Federal agency may each issue any regulations necessary to carry out 

the applicable provisions of this title and the applicable amendments made by this 

title. 

SEC. 584. RELATION TO STATE AND LOCAL LAWS. 

This title and the amendments made by this title may not be construed to 

preempt, annul, alter, amend, or exempt any person from compliance with any law, 

ordinance, or regulation of any State or local government with respect to land use, 

management, or control. 

42 USC 4001 

note. 

42 USC 4001 

note. 

108 STAT. 2287