I
104TH CONGRESS
1ST SESSION
H. R. 1856
To amend the Robert T. Stafford Disaster Relief and Emergency Assistance
Act to provide for an expanded Federal program of hazard mitigation,
relief, and insurance against the risk of catastrophic natural disasters,
such as hurricanes, earthquakes, and volcanic eruptions, and for other
purposes.
IN THE HOUSE OF REPRESENTATIVES
JUNE 15, 1995
Mr. EMERSON (for himself, Mr. MINETA, Mr. EWING, Mr. BOEHLERT, Mr.
ABERCROMBIE, Mr. ACKERMAN, Mr. ANDREWS, Mr. BAESLER, Mr. BLI-
LEY, Mr. BORSKI, Mr. BROWN of Ohio, Mr. BURTON of Indiana, Mr.
CALVERT, Mr. CANADY of Florida, Mr. CLYBURN, Mr. COLLINS of Geor-
gia, Miss COLLINS of Michigan, Mr. CONDIT, Mr. COSTELLO, Mr.
CRAMER, Mr. CRANE, Ms. DANNER, Mr. DEFAZIO, Mr. DEUTSCH, Mr.
DIAZ-BALART, Mr. DICKS, Mr. DICKEY, Mr. DINGELL, Mr. DIXON, Mr.
DOOLITTLE, Mr. DORNAN, Mr. DREIER, Mr. DURBIN, Ms. ESHOO, Mr.
FALEOMAVAEGA, Mr. FARR, Mr. FAZIO of California, Mr. FIELDS of
Texas, Mr. FILNER, Mr. FORD, Mrs. FOWLER, Ms. FURSE, Mr.
GALLEGLY, Mr. GILLMOR, Mr. GORDON, Mr. GENE GREEN of Texas, Mr.
HALL of Texas, Mr. HASTERT, Mr. HAYES, Mr. HERGER, Mr. HOBSON,
Mr. HORN, Mr. HUTCHINSON, Ms. EDDIE BERNICE JOHNSON of Texas,
Mr. JOHNSTON of Florida, Mr. KIM, Mr. KNOLLENBERG, Mr. LAHOOD,
Mrs. LINCOLN, Mr. LATOURETTE, Mr. LAUGHLIN, Mr. LEWIS of Califor-
nia, Mr. LIPINSKI, Mr. LIVINGSTON, Mr. MATSUI, Mr. MANZULLO, Mr.
MCCOLLUM, Mr. MCDERMOTT, Mr. MCKEON, Mrs. MEEK of Florida,
Mr. MINGE, Mr. MOORHEAD, Mr. MYERS of Indiana, Mr. NEAL of Mas-
sachusetts, Mr. NEY, Mr. NUSSLE, Mr. OBERSTAR, Mr. PALLONE, Mr.
PASTOR, Mr. PAXON, Mr. PETERSON of Florida, Mr. POMEROY, Mr.
PORTER, Mr. POSHARD, Mr. QUILLEN, Mr. QUINN, Mr. RAHALL, Mr.
RIGGS, Mr. ROMERO-BARCELO´, Mr. SCHIFF, Mr. SHAW, Mr. SKELTON,
Mr. SOLOMON, Mr. SPENCE, Mr. STEARNS, Mr. TALENT, Mr. THORN-
TON, Mr. TORRICELLI, Mr. TOWNS, Mr. TRAFICANT, Mr. TUCKER, Mr.
VOLKMER, Mr. WELDON of Pennsylvania, Mr. WHITFIELD, and Mr.
WISE) introduced the following bill; which was referred to the Committee
on Transportation and Infrastructure, and in addition to the Committees
on Commerce, Banking and Financial Services, and Ways and Means, for
a period to be subsequently determined by the Speaker, in each case for
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consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned
A BILL
To amend the Robert T. Stafford Disaster Relief and Emer-
gency Assistance Act to provide for an expanded Federal
program of hazard mitigation, relief, and insurance
against the risk of catastrophic natural disasters, such
as hurricanes, earthquakes, and volcanic eruptions, and
for other purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act shall be cited as the ‘‘Natural Disaster Pro-
tection Partnership Act of 1995’’.
SEC. 2. FINDINGS AND PURPOSES.
Section 101 of the Robert T. Stafford Disaster Relief
and Emergency Assistance Act (42 U.S.C. 5121) is
amended as follows:
(1) In subsection (a), by—
(A) striking ‘‘and’’ at the end of paragraph
(1);
(B) inserting ‘‘and’’ following the semi-
colon in paragraph (2);
(C) inserting the following new paragraph
before ‘‘special measures’’:
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‘‘(3) because catastrophic natural disasters,
such as major hurricanes, earthquakes, volcanic
eruptions, and floods pose significant problems in
terms of substantial long-term consequences, ill-
equipped preparedness efforts, lack of hazard miti-
gation measures (such as enforced building codes),
and inadequate insurance coverage;’’;
(D) inserting ‘‘promoting hazard mitiga-
tion compliance and in’’ after ‘‘affected States
in’’; and
(E) inserting ‘‘insurance coverage,’’ after
‘‘rendering of aid, assistance,’’.
(2) In subsection (b), by—
(A) inserting before the semi-colon in para-
graph (1) ‘‘by including State and community
disaster mitigation and expanded insurance and
reinsurance coverage to supplement insurance
available in the private market’’;
(B) inserting after ‘‘preparedness’’ in para-
graph (2) ‘‘, hazard mitigation, compliance,’’;
(C) inserting after ‘‘preparedness’’ in para-
graph (3) ‘‘, hazard mitigation, emergency first
response,’’;
(D) inserting after ‘‘insurance coverage’’ in
paragraph (4) ‘‘with premiums based on risk’’;
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(E) inserting before the semi-colon in
paragraph (4) ‘‘and by creating a private Natu-
ral Disaster Insurance Corporation which shall
provide primary insurance to homeowners and
reinsurance to State insurance pools and pri-
vate insurance companies’’;
(F) inserting before the semi-colon in para-
graph (5) ‘‘, adoption and enforcement of build-
ing codes, and improvement of first responder
capabilities’’; and
(G) inserting after ‘‘disasters’’ in para-
graph (6) ‘‘and establishing a funding mecha-
nism to help States and communities pay for
pre-disaster hazard mitigation’’.
SEC. 3. DEFINITIONS.
Section 102 of the Robert T. Stafford Disaster Relief
and Emergency Assistance Act (42 U.S.C. 5122) is
amended by adding at the end the following new para-
graphs:
‘‘(10) The term ‘building’ means any structure,
fully or partially enclosed, used or intended for shel-
tering persons or property.
‘‘(11) The term ‘commercial losses’ means
physical damage losses to insured commercial (other
than residential) property and other losses arising
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out of the effects of earthquakes, volcanic eruptions,
tsunamis, and hurricanes for the lines of insurance
appearing in the National Association of Insurance
Commissioners Fire and Casualty Annual Statement
as determined by the Natural Disaster Insurance
Corporation under section 902 and which shall, at a
minimum, include the following:
‘‘(A) Commercial Multiple Peril.
‘‘(B) Workers’ Compensation.
‘‘(C) Allied Lines.
‘‘(D) Fire.
‘‘(E) Reinsurance.
‘‘(F) Liability.
‘‘(G) Earthquake.
‘‘(H) Inland Marine.
‘‘(I) Ocean Marine.
‘‘(12) The term ‘critical facilities and lifelines’
means major public infrastructure, including high-
ways, roads, bridges, mass transit facilities, airports,
public buildings, water transportation and treatment
facilities, electric utilities, electric power and natural
gas transmission lines, and telecommunication facili-
ties.
‘‘(13) The term ‘Director’ means the Director
of the Federal Emergency Management Agency.
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‘‘(14) The term ‘earthquake’ means any shak-
ing or trembling of the crust of the Earth caused by
underground seismic forces.
‘‘(15) The term ‘federally-related mortgage
loan’ has the meaning given the term in section 3(1)
of the Real Estate Settlement Procedures Act of
1974 (12 U.S.C. 2602(1)).
‘‘(16) The term ‘first responder’ means fire-
fighting, police, and emergency medical personnel
who have the statutory authority to engage in and
provide immediate emergency response services.
‘‘(17) The term ‘flood’ or ‘flooding’ means a
general and temporary condition of partial or com-
plete inundation of normally dry land areas from the
overflow of inland or tidal waters or the unusual and
rapid accumulation of runoff or surface waters from
any source.
‘‘(18) The term ‘hurricane’ means a non-fron-
tal, warm core, low pressure atmospheric system
having a definite organized circulation with sus-
tained wind speeds of 74 miles per hour or greater
and officially declared to be a hurricane by the Na-
tional Hurricane Center, including any associated
windstorm events occurring within 168 hours before
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and after the hurricane first makes landfall within
a State.
‘‘(19) The term ‘local community’ means a po-
litical subdivision of a State that has a department,
or similar entity, which oversees local zoning and
building code compliance efforts.
‘‘(20) The term ‘natural disaster-prone State’
means a State determined by the Director pursuant
to section 804 to have an exposure to the earth-
quake, volcanic eruption, tsuanami, windstorm, or
hurricane perils.
‘‘(21) The term ‘new’, when used in connection
with buildings, construction, or property, means
structures built pursuant to building permits issued
after the date of enactment of the Natural Disaster
Protection Partnership Act of 1995.
‘‘(22) The term ‘ordinance or law coverage’
means insurance coverage for the increased cost of
construction to repair or rebuild buildings and the
cost of demolition due to the enforcement of any or-
dinance or law, such as building codes.
‘‘(23) The term ‘primary insurance coverage’
means policies or supplemental contracts of insur-
ance insured in the name of the Natural Disaster
Insurance Corporation pursuant to section 911 that
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provide indemnity, in whole or in part, for the loss,
destruction, or damage of residential property.
‘‘(24) The term ‘private insurer’ means any pri-
vate insurer or private reinsurer, including all relat-
ed affiliates or subsidiaries under the same owner-
ship or management consistent with the definition of
affiliated group under section 1504(a) of the Inter-
nal Revenue Code of 1986 (26 U.S.C. 1504(a)), that
is licensed or admitted to write property and cas-
ualty insurance or reinsurance within a State.
‘‘(25) The term ‘rate’, when used in the context
of insurance, means the cost of insurance per expo-
sure unit assessed for the primary insurance cov-
erages under subtitle B of title IX and the reinsur-
ance coverage under subtitle C of title IX which
shall include the following:
‘‘(A) The pure expected loss cost that is
actuarially based on the level of risk and rep-
resents the amount needed to pay expected
losses.
‘‘(B) The loss adjustment expense.
‘‘(C) A factor for the mitigation set aside
assessed under section 904(b).
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‘‘(D) Administrative costs of the Natural
Disaster Insurance Corporation created under
section 901.
‘‘(E) Compensation for private insurers’
costs, including administrative expenses, agent
commissions, and taxes.
‘‘(26) The term ‘reinsurance coverage’ means
the contract provided by the Natural Disaster Insur-
ance Corporation under section 921 in which such
Corporation accepts and agrees to pay part of the
losses for certain catastrophic natural disasters cov-
ered by a private insurer or a State insurance pool.
‘‘(27) The term ‘residential property’ means
any 1- to 4-family residential building (including mo-
bile or manufactured homes).
‘‘(28) The term ‘standard residential property
insurance contract’ means the conventional policies
offered by a private insurer to its residential prop-
erty policyholders that provides indemnity, in whole
or in part, for the loss, destruction, or damage of
residential property.
‘‘(29) The term ‘State insurance pool’ means
any State-authorized joint underwriting or joint re-
insurance association, risk pool, residual market
mechanism, or other type of State-sanctioned entity
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providing property insurance coverage against hurri-
canes, earthquakes, volcanic eruptions, or tsunamis
which meets minimum standards established by the
Natural Disaster Insurance Corporation under sec-
tion 902 regarding actuarially sound rates, use of
available local financing, and reasonable underwrit-
ing standards.
‘‘(30) The term ‘subject net written premium’
means direct and reinsurance premiums received by
private insurers, less premiums paid for ceded rein-
surance, for residential property insurance and for
all covered commercial lines of insurance included in
the plan of operation under section 902(a)(4)(B).
‘‘(31) The term ‘substantially modified building
construction’ means additions or improvements to an
existing building which constitute over an 18-month
period at least a 50 percent increase in the current
value of the building, as measured by the most re-
cent official property assessment.
‘‘(32) The term ‘tsunami’ means an ocean wave
generated by underwater disturbances in the earth’s
crust, primarily earthquakes and submarine volcanic
eruptions.
‘‘(33) The term ‘volcanic eruption’ means the
expulsion, as a result of natural causes, of molten
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rock, rock fragments, gases, ashes, mud, lava flows,
and other natural substances through an opening in
the crust of the Earth.
‘‘(34) The term ‘windstorm’ means an atmos-
pheric disturbance marked by high velocity move-
ments of air, including a tornado, but does not in-
clude a hurricane.’’.
SEC. 4. FEDERAL SHARE OF FINANCIAL ASSISTANCE.
(a) Section 406(a)(1) of the Robert T. Stafford Dis-
aster Relief and Emergency Assistance Act (42 U.S.C.
5172(a)(1)) is amended by inserting following before the
semicolon: ‘‘if the State has paid, or agreed to pay, at least
$5 per each resident of the State, as determined by the
latest official census, for the repair, restoration, recon-
struction, or replacement of public facilities damaged or
destroyed by such major disaster in the State’’.
(b) Section 406(b) of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act (42 U.S.C. 5172(b))
is amended as follows:
(1) Strike ‘‘MINIMUM’’ and ‘‘not less than’’.
(2) Insert following the first dash ‘‘(1) SHARE
AMOUNTS.—’’.
(3) Redesignate paragraphs (1), (2), and (3) as
subparagraphs (A), (B), and (C) respectively.
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(4) Add at the end the following new para-
graph:
‘‘(2) WAIVER.—The Federal share percentages
described in paragraph (1), as may be modified by
section 914(a), shall be increased only upon the en-
actment of a joint resolution that shall not be des-
ignated as an emergency under section 251(b)(2)(D)
of the Balanced Budget and Emergency Deficit Con-
trol Act of 1985 (2 U.S.C. 901(b)(2)(D)).’’.
(c) Section 407(d) of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act (42 U.S.C. 5173(d))
is amended as follows:
(1) Strike ‘‘not less than’’.
(2) Insert following the dash ‘‘(1) SHARE
AMOUNT.—’’.
(3) Add at the end the following new para-
graph:
‘‘(2) WAIVER.—The Federal share percentage
described in paragraph (1), as may be modified by
section 914(a), shall be increased only upon the en-
actment of a joint resolution that shall not be des-
ignated as an emergency under section 251(b)(2)(D)
of the Balanced Budget and Emergency Deficit Con-
trol Act of 1985 (2 U.S.C. 901(b)(2)(D)).’’.
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SEC. 5. AMENDMENTS TO THE ACT.
The Robert T. Stafford Disaster Relief and Emer-
gency Assistance Act (42 U.S.C. 5121 et seq.) is amended
by adding at the end the following new titles:
‘‘TITLE VIII—DISASTER
MITIGATION
‘‘Subtitle Federal Emergency
Management Agency
‘‘SEC. 801. SUPPORT PROGRAMS.
‘‘The Director shall establish and carry out natural
disaster hazard mitigation programs that support the fol-
lowing purposes:
‘‘(1) RESEARCH.—The Director shall undertake
research to strengthen building codes and promote
development of cost-effective building technologies
and other related hazard mitigation measures.
‘‘(2) TECHNOLOGY.—The Director shall develop
hazard mitigation technology for States, local com-
munities, and architects, engineers, building contrac-
tors, and other persons responsible for implementa-
tion and enforcement of hazard mitigation measures.
‘‘(3) EDUCATION.—The Director shall under-
take educational programs to enhance public aware-
ness of the risks and hazards associated with natu-
ral disasters and ways to mitigate losses from such
disasters.
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‘‘SEC. 802. NEW FEDERAL BUILDING STANDARDS.
‘‘Executive Order 12699 (55 Fed. Reg. 835 (January
5, 1990)) relating to earthquake design and construction
standards for Federally leased, assisted, or regulated
buildings shall have the effect of law.
‘‘SEC. 803 STUDIES.
‘‘(a) NATIONAL MINIMUM CONSENSUS BUILDING
CONSTRUCTION STANDARDS.—
‘‘(1) STUDY.—The Director shall enter into an
arrangement with the National Academy of Sciences
to conduct a study of the advisability and feasibility
of establishing national minimum consensus building
construction standards for residential and commer-
cial building construction. The study shall be limited
to the use of national minimum consensus building
construction standards to minimize property damage
and reduce personal injuries that result from natural
disasters, such as hurricanes, windstorms, earth-
quakes, and floods.
‘‘(2) NATIONAL ACADEMY OF SCIENCES.—The
study described in paragraph (1) shall be performed
by a panel of recognized experts appointed by the
National Academy of Sciences. The experts shall in-
clude representatives of building constructors, real-
tors, private insurers, building code officials from
the model building code organizations, organized
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labor, and other experts deemed relevant by the Na-
tional Academy of Sciences.
‘‘(3) TRANSMIT TO CONGRESS.—The study de-
scribed in paragraph (1), with any recommendations,
shall be transmitted by the National Academy of
Sciences to Congress within 2 years of the date of
enactment of the Natural Disaster Protection Part-
nership Act of 1995.
‘‘(b) RESIDENTIAL DISASTER INSPECTIONS.—
‘‘(1) STUDY.—The Director shall enter into an
arrangement with the National Academy of Sciences
to conduct a study of the advisability and feasibility
of establishing standards for the training and licens-
ing of home inspectors and using home inspections
as a means to promote natural disaster hazard miti-
gation of residential property.
‘‘(2) NATIONAL ACADEMY OF SCIENCES.—The
study described in paragraph (1) shall be performed
by a panel of recognized experts appointed by the
National Academy of Sciences. The experts shall in-
clude representatives of building constructors, lend-
ing institutions, local community officials, private in-
surers, homeowners organizations, organized labor,
and other experts deemed relevant by the National
Academy of Sciences.
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‘‘(3) TRANSMIT
TO
CONGRESS.—The study,
with any recommendations, described in paragraph
(1) shall be transmitted by the National Academy of
Sciences to Congress within 2 years of the date of
enactment of the Natural Disaster Protection Part-
nership Act of 1995.
‘‘SEC. 804. DESIGNATION OF NATURAL DISASTER-PRONE
STATES.
‘‘(a) DESIGNATION.—Within 6 months of the date of
enactment of the Natural Disaster Protection Partnership
Act of 1995 and at the beginning of each new calendar
year thereafter, the Director shall determine which States
are deemed to have an exposure to the earthquake, vol-
canic eruption, tsunami, windstorm, or hurricane perils.
Based upon scientific risk data, such States shall be classi-
fied as natural disaster-prone for purposes of this Act.
‘‘(b) SCIENTIFIC RISK DATA.—
‘‘(1) SEISMIC
PERILS.—The determination of
which States are deemed to have an exposure to the
earthquake, volcanic eruption, or tsunami perils
shall be based solely on seismic data provided by the
United States Geological Survey, or its designated
successor agency.
‘‘(2) HURRICANE PERIL.—The determination of
which States are deemed to have an exposure to the
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windstorm or hurricane peril shall be based solely on
windstorm and hurricane data provided by the Na-
tional Oceanic and Atmospheric Administration, or
its designated successor agency.
‘‘Subtitle B—State and Community
Programs
‘‘SEC. 811. ADOPTION OF BUILDING AND SAFETY CODES.
‘‘(a) 
MULTI-HAZARD
BUILDING
AND
SAFETY
CODES.—At a minimum, each natural disaster-prone
State shall either—
‘‘(1) adopt for all new and substantially modi-
fied building construction in that State building
codes that meet the appropriate hurricane, wind-
storm, earthquake, volcanic eruption, or tsunami
natural disaster hazard mitigation portions of the
newest edition of—
‘‘(A) at least one of the following model
building codes which shall be applicable to re-
gions that are exposed to such natural disaster
perils:
‘‘(i) the National Building Code,
‘‘(ii) the Standard Building Code,
‘‘(iii) the Uniform Building Code; and
‘‘(B) other relevant building and housing
codes and standards, including the national
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‘‘TITLE IX—NATURAL DISASTER
INSURANCE
‘‘Subtitle A—Natural Disaster
Insurance Corporation
‘‘SEC. 901. ORGANIZATIONAL STRUCTURE.
‘‘(a) CREATION.—As a condition of receiving Federal
loans under section 906(d), there shall be established a
non-governmental, not-for-profit membership corporation,
to be known as the Natural Insurance Corporation (here-
inafter in the Act referred to as the ‘‘Corporation’’), to
provide primary insurance coverages and reinsurance cov-
erage for hurricanes, earthquakes, volcanic eruptions, and
tsunamis.
‘‘(b) MEMBERSHIP.—The members of the Corpora-
tion shall own shares in the Corporation and shall consist
of private insurers that participate as service providers for
the primary insurance coverages insured by the Corpora-
tion under section 911 and private insurers and State in-
surance pools that purchase the reinsurance coverage pro-
vided by the Corporation under section 921.
‘‘(c) START-UP.—
‘‘(1) ADMINISTRATOR.—
‘‘(A) SELECTION.—A start-up adminis-
trator shall be selected by the Corporation’s