II 

116TH CONGRESS 

1ST SESSION S. 2192 

To amend the National Flood Insurance Act of 1968 to allow the Administrator of the Federal Emergency Management Agency to provide capitalization grants to States to establish revolving funds to provide funding 

assistance to reduce flood risks, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

JULY 18, 2019 

Mr. REED (for himself, Mr. KENNEDY, and Mr. MENENDEZ) introduced the 

following bill; which was read twice and referred to the Committee on 

Banking, Housing, and Urban Affairs 

A BILL 

To amend the National Flood Insurance Act of 1968 to 

allow the Administrator of the Federal Emergency Management Agency to provide capitalization grants to 

States to establish revolving funds to provide funding 

assistance to reduce flood risks, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘State Flood Mitigation 

5 Revolving Fund Act of 2019’’. 


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1 SEC. 2. STATE REVOLVING LOAN FUNDS FOR FLOOD MITI2 GATION. 

3 (a) IN GENERAL.—Chapter I of the National Flood 

4 Insurance Act of 1968 (42 U.S.C. 4011 et seq.) is amend5 ed by adding at the end the following: 

6 ‘‘SEC. 1326. STATE REVOLVING LOAN FUNDS FOR FLOOD 

7 MITIGATION. 

8 ‘‘(a) DEFINITIONS.—In this section: 

9 ‘‘(1) COMMUNITY RATING SYSTEM.—The term 

10 ‘Community Rating System’ means the community 

11 rating system program carried out under section 

12 1315(b). 

13 ‘‘(2) ELIGIBLE STATE.—The term ‘eligible 

14 State’ means a State, the District of Columbia, and 

15 the Commonwealth of Puerto Rico. 

16 ‘‘(3) INSULAR AREA.—The term ‘insular area’ 

17 means— 

18 ‘‘(A) Guam; 

19 ‘‘(B) American Samoa; 

20 ‘‘(C) the Commonwealth of the Northern 

21 Mariana Islands; 

22 ‘‘(D) the Federated States of Micronesia; 

23 ‘‘(E) the Republic of the Marshall Islands; 

24 ‘‘(F) the Republic of Palau; and 

25 ‘‘(G) the United States Virgin Islands. 


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1 ‘‘(4) INTENDED USE PLAN.—The term ‘in2 tended use plan’ means a plan prepared under sub3 section (d)(1). 

4 ‘‘(5) LOW-INCOME GEOGRAPHIC AREA.—The 

5 term ‘low-income geographic area’ means an area 

6 described in paragraph (1) or (2) of section 301(a) 

7 of the Public Works and Economic Development Act 

8 of 1965 (42 U.S.C. 3161(a)). 

9 ‘‘(6) LOW-INCOME HOMEOWNER.—The term 

10 ‘low-income homeowner’ means the owner of a pri11 mary residence, the household income of which in a 

12 taxable year is not more than 80 percent of the me13 dian income for the area in which the residence is 

14 located. 

15 ‘‘(7) PARTICIPATING STATE.—The term ‘par16 ticipating State’ means an eligible State that— 

17 ‘‘(A) has entered into an agreement under 

18 subsection (b)(1); and 

19 ‘‘(B) agrees to comply with the require20 ments of this section. 

21 ‘‘(8) PRE-FIRM BUILDING.—The term ‘pre22 FIRM building’ means a building for which con23 struction or substantial improvement occurred before 

24 the effective date of the initial Flood Insurance Rate 


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1 Map published by the Administrator under section 

2 1360 for the area in which the building is located. 

3 ‘‘(9) REPETITIVE LOSS STRUCTURE.—The term 

4 ‘repetitive loss structure’ has the meaning given the 

5 term in section 1370(a). 

6 ‘‘(10) SEVERE REPETITIVE LOSS PROPERTY.— 

7 The term ‘severe repetitive loss property’ has the 

8 meaning given the term in section 1307(h). 

9 ‘‘(11) STATE LOAN FUND.—The term ‘State 

10 loan fund’ means a flood mitigation assistance re11 volving loan fund established by an eligible State 

12 under this section. 

13 ‘‘(12) TRIBAL GOVERNMENT.—The term ‘tribal 

14 government’ means the recognized government of an 

15 Indian tribe, or the governing body of an Alaska Na16 tive regional or village corporation, that has been de17 termined eligible to receive services from the Bureau 

18 of Indian Affairs. 

19 ‘‘(b) GENERAL AUTHORITY.— 

20 ‘‘(1) IN GENERAL.—The Administrator may 

21 enter into an agreement with an eligible State to 

22 provide a capitalization grant for the eligible State 

23 to establish a revolving fund that will provide fund24 ing assistance to help homeowners, businesses, nonVerDate Sep 11 2014 03:07 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S2192.IS S2192

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1 profit organizations, and communities reduce flood 

2 risk in order to decrease— 

3 ‘‘(A) the loss of life and property; 

4 ‘‘(B) the cost of flood insurance; and 

5 ‘‘(C) Federal disaster payments. 

6 ‘‘(2) TIMING OF DEPOSIT AND AGREEMENTS

7 FOR DISTRIBUTION OF FUNDS.— 

8 ‘‘(A) IN GENERAL.—Not later than the 

9 last day of the fiscal year following the fiscal 

10 year in which a capitalization grant is made to 

11 a participating State under paragraph (1), the 

12 participating State shall— 

13 ‘‘(i) deposit the grant in the State 

14 loan fund of the State; and 

15 ‘‘(ii) enter into 1 or more binding 

16 agreements that provide for the State to 

17 distribute the grant funds for purposes au18 thorized under subsection (c) such that— 

19 ‘‘(I) in the case of the initial 

20 grant made to a State under this sec21 tion, not less than 75 percent of the 

22 amount of the grant shall be distrib23 uted before the end of the 2-year pe24 riod beginning on the date on which 


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1 the funds are deposited in the State 

2 loan fund of the State; and 

3 ‘‘(II) in the case of any subse4 quent grant made to a State under 

5 this section, not less than 90 percent 

6 of the amount of the grant shall be 

7 distributed before the end of the 1- 

8 year period beginning on the date on 

9 which the funds are deposited in the 

10 State loan fund of the State. 

11 ‘‘(B) NONCOMPLIANCE.—Except as pro12 vided in subparagraph (C), if a participating 

13 State does not comply with subparagraph (A) 

14 with respect to a grant, the Administrator shall 

15 reallocate the grant in accordance with para16 graph (3)(B). 

17 ‘‘(C) EXCEPTION.—The Administrator 

18 may not reallocate any funds under subpara19 graph (B) to a participating State that violated 

20 subparagraph (A) with respect to a grant made 

21 during the same fiscal year in which the funds 

22 to be reallocated were originally made available. 

23 ‘‘(3) ALLOCATION.— 


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1 ‘‘(A) IN GENERAL.—The Administrator 

2 shall allocate amounts made available to carry 

3 out this section to participating States— 

4 ‘‘(i) for the participating States to de5 posit in the State loan funds established by 

6 the participating States; and 

7 ‘‘(ii) except as provided in paragraph 

8 (6), in accordance with the requirements 

9 described in subparagraph (B). 

10 ‘‘(B) REQUIREMENTS.—The requirements 

11 described in this subparagraph are as follows: 

12 ‘‘(i) Fifty percent of the total amount 

13 made available under subparagraph (A) 

14 shall be allocated so that each partici15 pating State receives the percentage 

16 amount that is obtained by dividing the 

17 number of properties that were insured 

18 under the national flood insurance pro19 gram in that State in the fiscal year pre20 ceding the fiscal year in which the amount 

21 is allocated by the total number of prop22 erties that were insured under the national 

23 flood insurance program in the fiscal year 

24 preceding the fiscal year in which the 

25 amount is allocated. 


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1 ‘‘(ii) Fifty percent of the total amount 

2 made available under subparagraph (A) 

3 shall be allocated so that each partici4 pating State receives a percentage of funds 

5 that is equal to the product obtained under 

6 clause (iii)(IV) with respect to that partici7 pating State after following the procedures 

8 described in clause (iii). 

9 ‘‘(iii) The procedures described in this 

10 clause are as follows: 

11 ‘‘(I) Divide the total amount col12 lected in premiums for properties in13 sured under the national flood insur14 ance program in each participating 

15 State during the previous fiscal year 

16 by the number of properties insured 

17 under the national flood insurance 

18 program in that State for that fiscal 

19 year. 

20 ‘‘(II) Add together each quotient 

21 obtained under subclause (I). 

22 ‘‘(III) For each participating 

23 State, divide the quotient obtained 

24 under subclause (I) with respect to 


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1 that State by the sum obtained under 

2 subclause (II). 

3 ‘‘(IV) For each participating 

4 State, multiply the amount that is 50 

5 percent of the total amount made 

6 available under subparagraph (A) by 

7 the quotient obtained under subclause 

8 (III). 

9 ‘‘(iv) Except as provided in paragraph 

10 (5), in a fiscal year— 

11 ‘‘(I) a participating State may 

12 not receive more than 15 percent of 

13 the total amount that is made avail14 able under subparagraph (A) in that 

15 fiscal year; and 

16 ‘‘(II) if a participating State, 

17 based on the requirements under 

18 clauses (i) through (iii), would, but 

19 for the limitation under subclause (I) 

20 of this clause, receive an amount that 

21 is greater than the amount that the 

22 State is authorized to receive under 

23 that subclause, the difference between 

24 the authorized amount and the 

25 amount otherwise due to the State 


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1 under clauses (i) through (iii) shall be 

2 allocated to other participating 

3 States— 

4 ‘‘(aa) that, in that fiscal 

5 year, have not received an 

6 amount under subparagraph (A) 

7 that is more than the authorized 

8 amount under subclause (I) of 

9 this clause; and 

10 ‘‘(bb) by using the require11 ments under clauses (i) through 

12 (iii), except that a participating 

13 State may receive an allocation 

14 under this subclause only if the 

15 allocation does not result in the 

16 State receiving a total amount 

17 for the fiscal year under subpara18 graph (A) that is greater than 

19 the authorized amount under 

20 subclause (I). 

21 ‘‘(4) NO REVOLVING FUND REQUIRED.— 

22 ‘‘(A) IN GENERAL.—Notwithstanding any 

23 other provision of this section, and subject to 

24 subparagraph (B), a participating State that 

25 receives less than $4,000,000 under paragraph 


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1 (3)(B) in a fiscal year may distribute the funds 

2 directly in the form of grants or technical as3 sistance for a purpose described in subsection 

4 (c)(2), without regard to whether the State has 

5 established a State loan fund. 

6 ‘‘(B) STATE MATCHING.—A participating 

7 State that exercises the authority under sub8 paragraph (A) in a fiscal year shall provide 

9 matching funds from non-Federal sources in an 

10 amount that is equal to 25 percent of the 

11 amount that the State receives under paragraph 

12 (3)(B) in that fiscal year for purposes described 

13 in subparagraph (A). 

14 ‘‘(5) ALLOCATION OF REMAINING FUNDS.— 

15 After allocating amounts made available to carry out 

16 this section for a fiscal year in accordance with 

17 paragraph (3), the Administrator shall allocate any 

18 remaining amounts made available for that fiscal 

19 year to participating States, using the procedures 

20 described in clauses (i) through (iii) of paragraph 

21 (3)(B). 

22 ‘‘(6) RESERVATION OF FUNDS.—The Adminis23 trator shall reserve not more than 1.5 percent of the 

24 amount made available to carry out this section in 

25 a fiscal year— 


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1 ‘‘(A) for administrative costs incurred in 

2 carrying out this section; 

3 ‘‘(B) to provide technical assistance to re4 cipients of grants under this section; and 

5 ‘‘(C) to enter into grant agreements with 

6 tribal governments and insular areas, with the 

7 grant funds to be distributed— 

8 ‘‘(i) according to criteria established 

9 by the Administrator; and 

10 ‘‘(ii) for a purpose described in sub11 section (c)(2). 

12 ‘‘(c) USE OF FUNDS.— 

13 ‘‘(1) IN GENERAL.—Amounts deposited in a 

14 State loan fund, including repayments of loans made 

15 from the fund and interest earned on the amounts 

16 in the fund, shall be used— 

17 ‘‘(A) consistent with paragraph (2) and 

18 subsection (g), to provide financial assistance 

19 for— 

20 ‘‘(i) homeowners, businesses, and non21 profit organizations that are eligible to 

22 participate in the national flood insurance 

23 program; and 


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1 ‘‘(ii) any local government that par2 ticipates in the national flood insurance 

3 program; 

4 ‘‘(B) as a source of revenue and security 

5 for leveraged loans, the proceeds of which shall 

6 be deposited in the State loan fund; or 

7 ‘‘(C) for the sale of bonds as security for 

8 payment of the principal and interest on rev9 enue or general obligation bonds issued by the 

10 participating State to provide matching funds 

11 under subsection (f), if the proceeds from the 

12 sale of the bonds are deposited in the State 

13 loan fund. 

14 ‘‘(2) PURPOSES.—A recipient of financial as15 sistance provided through amounts from a State 

16 loan fund— 

17 ‘‘(A) shall use the amounts to reduce— 

18 ‘‘(i) flood risk; or 

19 ‘‘(ii) potential claims for losses cov20 ered under the national flood insurance 

21 program; 

22 ‘‘(B) shall use the amounts in a cost-effec23 tive manner under requirements established by 

24 the State, which may require an applicant for 

25 financial assistance to submit any information 


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1 that the State considers relevant or necessary 

2 before the date on which the applicant receives 

3 the assistance; 

4 ‘‘(C) shall use the amounts for projects 

5 that— 

6 ‘‘(i) meet design and construction 

7 standards established by the Adminis8 trator; 

9 ‘‘(ii) are located in communities 

10 that— 

11 ‘‘(I) participate in the national 

12 flood insurance program; and 

13 ‘‘(II) have developed a State or 

14 community hazard mitigation plan 

15 that has been approved by the Admin16 istrator under section 1366; 

17 ‘‘(iii) address— 

18 ‘‘(I) a repetitive loss structure or 

19 a severe repetitive loss property; or 

20 ‘‘(II) flood risk in the 500-year 

21 floodplain, areas of residual flood risk, 

22 or other areas of potential flood risk, 

23 as identified by the Administrator; 

24 and 


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1 ‘‘(iv) address current risk and antici2 pate future risk, such as sea-level rise; 

3 ‘‘(D) may use the amounts— 

4 ‘‘(i) for projects relating to— 

5 ‘‘(I) structural elevation; 

6 ‘‘(II) floodproofing; 

7 ‘‘(III) the relocation or removal 

8 of buildings from the 100-year flood9 plain or other areas of flood risk, in10 cluding the acquisition of properties 

11 for such a purpose; 

12 ‘‘(IV) environmental restoration 

13 activities that directly reduce flood 

14 risk; 

15 ‘‘(V) any eligible activity de16 scribed in subparagraphs (A) through 

17 (G) of section 1366(c)(3); or 

18 ‘‘(VI) other activities determined 

19 appropriate by the Administrator; 

20 ‘‘(ii) with respect to a project de21 scribed in clause (i), only for expenditures 

22 directly related to a project described in 

23 that clause, including expenditures for 

24 planning, design, and associated pre-con25 struction activities; and 


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1 ‘‘(iii) to acquire, for the purposes of 

2 permanent protection, land, buildings, or a 

3 conservation easement from a willing seller 

4 or grantor; 

5 ‘‘(E) may not use the amounts— 

6 ‘‘(i) to construct buildings or expand 

7 existing buildings, unless the activity is for 

8 the purpose of flood mitigation; 

9 ‘‘(ii) to improve any structure, unless 

10 the recipient has obtained flood insurance 

11 coverage, which shall be maintained for the 

12 useful life of the structure, in an amount 

13 that is not less than the lesser of— 

14 ‘‘(I) the eligible project costs with 

15 respect to the structure; and 

16 ‘‘(II) the maximum insurable 

17 limit for the structure under the na18 tional flood insurance program cov19 erage for the structure; 

20 ‘‘(iii) to improve a residential property 

21 with an appraised value that is not less 

22 than 125 percent of the limitation on the 

23 maximum original principal obligation of a 

24 conventional mortgage that may be pur25 chased by the Federal National Mortgage 


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1 Association or the Federal Home Loan 

2 Mortgage Corporation in the area in which 

3 the property is located, as established 

4 under section 302(b)(2) of the Federal Na5 tional Mortgage Association Charter Act 

6 (12 U.S.C. 1717(b)(2)) and section 

7 305(a)(2) of the Federal Home Loan 

8 Mortgage Corporation Act (12 U.S.C. 

9 1454(a)(2)); 

10 ‘‘(iv) for the direct benefit of a home11 owner if the annual household adjusted 

12 gross income of the homeowner during the 

13 previous fiscal year was not less than 

14 $200,000, as annually adjusted by the Ad15 ministrator to reflect changes in the Con16 sumer Price Index for All Urban Con17 sumers, as published by the Bureau of 

18 Labor Statistics of the Department of 

19 Labor and rounded to the nearest $25; or 

20 ‘‘(v) to acquire real property or an in21 terest in real property unless the property 

22 is purchased from a willing seller; and 

23 ‘‘(F) to the maximum extent practicable, 

24 shall, in using those amounts, give priority to 


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1 projects that assist low-income homeowners and 

2 low-income geographical areas. 

3 ‘‘(d) INTENDED USE PLANS.— 

4 ‘‘(1) IN GENERAL.—After providing the oppor5 tunity for public review and comment, each partici6 pating State shall annually prepare a plan that iden7 tifies, for the year following the date of issuance of 

8 the intended use plan, the intended uses of the 

9 amounts available in the State loan fund of the par10 ticipating State. 

11 ‘‘(2) CONSULTATION DURING PREPARATION.— 

12 Each participating State, in preparing an intended 

13 use plan, shall ensure that the State agency with 

14 primary responsibility for floodplain management— 

15 ‘‘(A) provides oversight with respect to the 

16 preparation of the intended use plan; and 

17 ‘‘(B) consults with any other appropriate 

18 State agency, including agencies responsible for 

19 coastal and environmental management. 

20 ‘‘(3) CONTENTS.—A participating State shall, 

21 in each intended use plan— 

22 ‘‘(A) include— 

23 ‘‘(i) an explanation of the mitigation 

24 and resiliency benefits the State intends to 

25 achieve, including by— 


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1 ‘‘(I) reducing future damage and 

2 loss associated with flooding; 

3 ‘‘(II) reducing the number of se4 vere repetitive loss properties and re5 petitive loss structures in the State; 

6 ‘‘(III) decreasing the number of 

7 flood insurance claims in the State; 

8 and 

9 ‘‘(IV) increasing the rating under 

10 the Community Rating System for 

11 communities in the State; 

12 ‘‘(ii) information with respect to the 

13 availability of, and the application process 

14 for receiving, financial assistance from the 

15 State loan fund of the State; 

16 ‘‘(iii) the criteria and methods estab17 lished for the distribution of amounts from 

18 the State loan fund of the State; 

19 ‘‘(iv) the amount of financial assist20 ance that the State anticipates providing 

21 to— 

22 ‘‘(I) local government projects; 

23 and 

24 ‘‘(II) projects for homeowners, 

25 business, or nonprofit organizations; 


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1 ‘‘(v) the expected terms of the assist2 ance provided under clause (iv); and 

3 ‘‘(vi) a description of the financial sta4 tus of the State loan fund and the short5 term and long-term goals of the State loan 

6 fund; and 

7 ‘‘(B) provide, to the maximum extent prac8 ticable, that priority for the use of amounts 

9 from the State loan fund shall be given to 

10 projects that— 

11 ‘‘(i) address severe repetitive loss 

12 properties and repetitive loss structures; 

13 ‘‘(ii) assist low-income homeowners 

14 and low-income geographic areas; and 

15 ‘‘(iii) address flood risk for pre-FIRM 

16 buildings. 

17 ‘‘(4) PUBLICATION.—Each participating State 

18 shall publish and periodically update a list of all 

19 projects receiving funding from the State loan fund 

20 of the State, which shall include identification of— 

21 ‘‘(A) the community in which the project is 

22 located; 

23 ‘‘(B) the type and amount of assistance 

24 provided for each project; and 


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1 ‘‘(C) the expected funding schedule and 

2 date of completion of each project. 

3 ‘‘(e) FUND MANAGEMENT.—Amounts in a State loan 

4 fund shall— 

5 ‘‘(1) remain available for providing financial as6 sistance under this section until distributed; 

7 ‘‘(2) if the amounts are not required for imme8 diate distribution or expenditure, be invested in in9 terest-bearing obligations; and 

10 ‘‘(3) except as provided in subsection (i), in11 clude only— 

12 ‘‘(A) amounts received from capitalization 

13 grants made under this section; 

14 ‘‘(B) repayments of loans made from the 

15 fund; and 

16 ‘‘(C) interest earned on amounts in the 

17 fund. 

18 ‘‘(f) MATCHING FUNDS.— 

19 ‘‘(1) FULL GRANT.—On or before the date on 

20 which a participating State receives a capitalization 

21 grant, the State shall deposit into the State loan 

22 fund of the State, in addition to the amount of the 

23 capitalization grant, an amount from non-Federal 

24 sources that is not less than 20 percent of the total 

25 amount of the capitalization grant. 


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1 ‘‘(2) REDUCED GRANT.—If, with respect to a 

2 capitalization grant, a participating State deposits in 

3 the State loan fund of the State an amount from 

4 non-Federal sources that is less than 20 percent of 

5 the total amount of the capitalization grant that the 

6 participating State would otherwise receive, the Ad7 ministrator shall— 

8 ‘‘(A) reduce the amount of the capitaliza9 tion grant received by the State to the amount 

10 that is 5 times the amount so deposited; and 

11 ‘‘(B) in accordance with subsection (b)(5), 

12 allocate the difference between the amount that 

13 the participating State would have received if 

14 the State had complied with paragraph (1) and 

15 the amount of the reduced grant that the par16 ticipating State receives under subparagraph 

17 (A). 

18 ‘‘(g) TYPES OF ASSISTANCE.—Unless otherwise pro19 hibited by State law, a participating State may use the 

20 amounts deposited into a State loan fund under this sec21 tion only— 

22 ‘‘(1) to make a loan, on the condition that— 

23 ‘‘(A) the interest rate for the loan is not 

24 more than the market interest rate; 


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1 ‘‘(B) the recipient of the loan will begin 

2 making principal and interest payments on the 

3 loan not later than 1 year after the date on 

4 which the project for which the loan was made 

5 is completed; 

6 ‘‘(C) the loan will be fully amortized not 

7 later than 20 years after the date on which the 

8 project for which the loan was made is com9 pleted, except that, in the case of a loan made 

10 for a project in a low-income geographic area or 

11 to a low-income homeowner, the State may pro12 vide a longer amortization period for the loan if 

13 that longer period— 

14 ‘‘(i) ends on a date that is not later 

15 than 30 years after the date on which the 

16 project is completed; and 

17 ‘‘(ii) is not longer than the expected 

18 design life of the project; 

19 ‘‘(D) the recipient of the loan dem20 onstrates, based on verified and documented in21 formation that, as of the date on which the loan 

22 is made, the recipient has a reasonable ability 

23 to repay the loan, according to the terms of the 

24 loan, except that this subparagraph may not be 

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1 tion in efforts to comply with the requirements 

2 of subsection (c)(2)(F); and 

3 ‘‘(E) payments of principal and interest 

4 with respect to the loan will be deposited into 

5 the State loan fund; 

6 ‘‘(2) to buy or refinance the debt obligation of 

7 a local government at an interest rate that is not 

8 more than the market interest rate; 

9 ‘‘(3) to guarantee, or purchase insurance for, a 

10 local obligation, the proceeds of which finance a 

11 project eligible for assistance under this section, if 

12 the guarantee or purchase, as applicable, would— 

13 ‘‘(A) improve credit market access; or 

14 ‘‘(B) reduce the interest rate with respect 

15 to the obligation; 

16 ‘‘(4) as a source of revenue or as security for 

17 the payment of principal and interest on revenue or 

18 general obligation bonds issued by the State if the 

19 proceeds of the sale of the bonds will be deposited 

20 into the State loan fund; or 

21 ‘‘(5) to earn interest on those amounts. 

22 ‘‘(h) ASSISTANCE FOR LOW-INCOME HOMEOWNERS

23 AND LOW-INCOME GEOGRAPHIC AREAS.— 

24 ‘‘(1) IN GENERAL.—Notwithstanding any other 

25 provision of this section, if a participating State uses 


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1 amounts from a State loan fund to provide financial 

2 assistance under subsection (c) in a low-income geo3 graphic area or to a low-income homeowner, the 

4 State may provide additional subsidization to the re5 cipient of the assistance, including forgiveness of the 

6 principal of a loan. 

7 ‘‘(2) LIMITATION.—For each fiscal year, the 

8 total amount of additional subsidization provided by 

9 a participating State under paragraph (1) may not 

10 exceed 30 percent of the amount of the capitaliza11 tion grant allocated to the State for that fiscal year. 

12 ‘‘(i) ADMINISTRATION OF FUND.— 

13 ‘‘(1) IN GENERAL.—A participating State may 

14 combine the financial administration of a State loan 

15 fund with the financial administration of any other 

16 revolving fund established by the State if— 

17 ‘‘(A) combining the administration of the 

18 funds would— 

19 ‘‘(i) be convenient and avoid adminis20 trative costs; and 

21 ‘‘(ii) not violate the law of the State; 

22 and 

23 ‘‘(B) the Administrator determines that— 

24 ‘‘(i) amounts obtained from a grant 

25 made under this section, amounts obtained 


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1 from the repayment of a loan made from 

2 a State loan fund, and interest earned on 

3 amounts in a State loan fund will be— 

4 ‘‘(I) accounted for separately 

5 from amounts from other revolving 

6 funds; and 

7 ‘‘(II) used only for purposes au8 thorized under this section; and 

9 ‘‘(ii) after consulting with the appro10 priate State agencies, the authority to es11 tablish assistance priorities and carry out 

12 oversight and related activities, other than 

13 financial administration, with respect to 

14 flood assistance remains with the State 

15 agency with primary responsibility for 

16 floodplain management. 

17 ‘‘(2) ADMINISTRATIVE AND TECHNICAL

18 COSTS.— 

19 ‘‘(A) IN GENERAL.—For each fiscal year, a 

20 participating State may use the amount de21 scribed in subparagraph (B) to— 

22 ‘‘(i) pay the reasonable costs of ad23 ministration of the programs under this 

24 section, including the recovery of reasonVerDate Sep 11 2014 03:07 Jul 26, 2019 Jkt 089200 PO 00000 Frm 00026 Fmt 6652 Sfmt 6201 E:\BILLS\S2192.IS S2192

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•S 2192 IS

1 able costs incurred in establishing a State 

2 loan fund; 

3 ‘‘(ii) provide appropriate oversight of 

4 projects authorized under this section; and 

5 ‘‘(iii) provide technical assistance and 

6 outreach to recipients in the State of 

7 amounts under this section, including with 

8 respect to updating hazard mitigation 

9 plans and participating in the Community 

10 Rating System, in an amount that is not 

11 more than 4 percent of the funds made 

12 available to the State under this section. 

13 ‘‘(B) DESCRIPTION.—The amount de14 scribed in this subparagraph is an amount 

15 equal to the sum of— 

16 ‘‘(i) any fees collected by a partici17 pating State to recover the costs described 

18 in subparagraph (A)(i), regardless of the 

19 source; and 

20 ‘‘(ii) the greatest of— 

21 ‘‘(I) $400,000; 

22 ‘‘(II) 0.2 percent of the value of 

23 the State loan fund of a State, as of 

24 the date on which the valuation is 

25 made; and 


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1 ‘‘(III) an amount equal to 7 per2 cent of all grant awards made to a 

3 participating State for the State loan 

4 fund of the State under this section 

5 for the fiscal year. 

6 ‘‘(3) AUDIT AND REPORT.— 

7 ‘‘(A) AUDIT REQUIREMENT.—Not less fre8 quently than biennially, each participating State 

9 shall conduct an audit of the State loan fund of 

10 the State. 

11 ‘‘(B) REPORT.—Each participating State 

12 shall submit to the Administrator a biennial re13 port regarding the activities of the State under 

14 this section during the period covered by the re15 port, including— 

16 ‘‘(i) the result of any audit conducted 

17 by the State under subparagraph (A); and 

18 ‘‘(ii) a review of the effectiveness of 

19 the State loan fund of the State with re20 spect to— 

21 ‘‘(I) the intended use plans of the 

22 State; and 

23 ‘‘(II) meeting the objectives de24 scribed in subsection (b)(1). 


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1 ‘‘(4) OVERSIGHT.—In conducting oversight with 

2 respect to State loan funds established under this 

3 section, the Administrator— 

4 ‘‘(A) shall— 

5 ‘‘(i) periodically audit the funds in ac6 cordance with procedures established by 

7 the Comptroller General of the United 

8 States; and 

9 ‘‘(ii) not less frequently than once 

10 every 4 years, review each State loan fund 

11 to determine the effectiveness of the fund 

12 in reducing flood risk; and 

13 ‘‘(B) may, at any time— 

14 ‘‘(i) make recommendations to a par15 ticipating State with respect to the admin16 istration of the State loan fund of the 

17 State; or 

18 ‘‘(ii) require specific changes with re19 spect to a State loan fund in order to im20 prove the effectiveness of the fund. 

21 ‘‘(j) LIABILITY PROTECTIONS.—The Federal Emer22 gency Management Agency shall not be liable for any 

23 claim based on the exercise or performance of, or the fail24 ure to exercise or perform, a discretionary function or duty 


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1 by the Agency, or an employee of the Agency, in carrying 

2 out this section. 

3 ‘‘(k) REGULATIONS.—The Administrator shall pro4 mulgate such guidance or regulations as may be necessary 

5 to carry out this section, including guidance or regulations 

6 that— 

7 ‘‘(1) ensure that each participating State to 

8 which funds are allocated under this section uses the 

9 funds as efficiently as possible; 

10 ‘‘(2) reduce, to the maximum extent prac11 ticable, waste, fraud, and abuse with respect to the 

12 implementation of this section; and 

13 ‘‘(3) require any party that receives funds di14 rectly or indirectly under this section, including a 

15 participating State and a recipient of amounts from 

16 a State loan fund, to use procedures with respect to 

17 the management of the funds that conform to gen18 erally accepted accounting standards. 

19 ‘‘(l) AUTHORIZATION OF APPROPRIATIONS.—There 

20 are authorized to be appropriated such sums as may be 

21 necessary to carry out this section for fiscal years 2020 

22 through 2029.’’. 

23 (b) CONSIDERATION OF MITIGATION MEASURES

24 FUNDED BY STATE LOAN FUNDS IN FLOOD INSURANCE

25 PREMIUM RATES.— 


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1 (1) ESTIMATED RATES.—Section 

2 1307(a)(1)(A)(ii) of the National Flood Insurance 

3 Act of 1968 (42 U.S.C. 4014(a)(1)(A)(ii)) is amend4 ed by striking ‘‘and similar measures’’ and inserting 

5 ‘‘similar measures, and any activities funded 

6 through amounts from a State loan fund established 

7 under section 1326,’’. 

8 (2) CHARGEABLE RATES.—Section 1308(b)(1) 

9 of the National Flood Insurance Act of 1968 (42 

10 U.S.C. 4015(b)(1)) is amended by striking ‘‘and 

11 similar measures’’ and inserting ‘‘similar measures, 

12 and any activities funded through amounts from a 

13 State loan fund established under section 1326’’. 

Æ 


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