Federal Disaster Notification and Payment Protection Act of 2016

To amend the Robert T. Stafford Disaster Relief and Emergency Assistance Act to protect individuals and businesses from unforeseen consequences that may result from Federal disaster assistance, and for other purposes. 1. Short title This Act may be cited as the Federal Disaster Notification and Payment Protection Act of 2016 2. Prohibition regarding use of Federal funds Notwithstanding any other provision of law, Federal funds may not be used to recoup a debt owed to the United States related to assistance provided to an individual or household under section 408 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act ( 42 U.S.C. 5174 42 U.S.C. 5170 (1) the assistance was distributed based on an error by the Federal Emergency Management Agency; (2) the collection of the debt would be against equity and good conscience; and (3) the debt is not the result of fraud, presentation of a false claim, misrepresentation, or other fault of the debtor or any party having an interest in the assistance distributed. 3. Mandatory notification for individuals and businesses applying for assistance Title VII of the Robert T. Stafford Disaster Relief and Emergency Assistance Act ( 42 U.S.C. 5201 et seq. 707. Mandatory notification for individuals and businesses applying for assistance (a) In general Not later than 180 days after the date of enactment of this section, the President shall establish a process to ensure that each individual and business that applies for a category of Federal disaster assistance is provided written notice that describes— (1) the various categories of Federal disaster assistance that may be available to the individual or business; (2) the impact that receiving or declining the category of Federal disaster assistance applied for will have on eligibility for other categories of Federal disaster assistance; and (3) repayment requirements or penalties that may apply if multiple categories of Federal disaster assistance are accepted. (b) Report to Congress On the date on which the President establishes the process under subsection (a), the President shall transmit to Congress a report describing the process. (c) Prohibition On and after the date on which the President establishes the process under subsection (a), an individual or business that is not provided the written notice described in that subsection upon application for a category of Federal disaster assistance may not be held responsible for any repayment requirement or penalty that would otherwise result from the receipt of such assistance. (d) Federal disaster assistance defined In this section, the term Federal disaster assistance (1) pursuant to this Act, the Small Business Act, or the community development block grant disaster recovery program of the Department of Housing and Urban Development; (2) to an individual or business; and (3) in response to a major disaster or emergency declared by the President under section 401 of this Act. .

Summary: Federal Disaster Notification and Payment Protection Act of 2016 This bill prohibits the use of federal funds to recoup a debt owed to the United States related to assistance provided to an individual or household under the Robert T. Stafford Disaster Relief and Emergency Assistance Act with respect to a major disaster declared by the President on or after January 1, 2011, if: the assistance was distributed based on an error by the Federal Emergency Management Agency (FEMA), the collection of the debt would be against equity and good conscience, and the debt is not the result of fraud or other fault of the debtor or any party having an interest in the assistance distributed. The Stafford Act is amended to require the President to establish a process to ensure that each individual and business that applies for a category of federal disaster assistance is provided written notice that describes: the various categories of federal disaster assistance that may be available, the impact that receiving or declining such assistance will have on eligibility for other categories of assistance, and repayment requirements or penalties that may apply if multiple categories of assistance are accepted. An individual or business that is not provided such notice may not be held responsible for any repayment requirement or penalty that would otherwise result from the receipt of such assistance.