(2) by inserting after paragraph (1) the fol-
lowing new paragraph: 
‘‘(2) RECENTLY PURCHASED PRE-FIRM PROP-
ERTIES.—Any property that— 
‘‘(A) has been constructed or substantially 
improved and for which such construction or 
improvement was started, as determined by the 
Director, before December 31, 1974, or before 
the effective date of the initial rate map pub-
lished by the Director under paragraph (2) of 
section 1360 for the area in which such prop-
erty is located, whichever is later; and 
‘‘(B) is purchased— 
‘‘(i) after the date of enactment of 
this paragraph; and 
‘‘(ii) for not less than $600,000.’’. 
(b) TECHNICAL AMENDMENTS.—Section 1308(c) of 
the National Flood Insurance Act of 1968 (42 U.S.C. 
4015(c)) is amended— 
(1) in the matter preceding paragraph (1), by 
striking ‘‘the limitations provided under paragraphs 
(1) and (2)’’ and inserting ‘‘subsection (e)’’; and 
(2) in paragraph (1), by striking ‘‘, except’’ and 
all that follows through ‘‘subsection (e)’’. 
(c) EFFECTIVE DATE AND TRANSITION.— 
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(1) EFFECTIVE DATE.—The amendments made 
by subsections (a) and (b) shall apply beginning on 
January 1, 2011, except as provided in paragraph 
(2) of this subsection. 
(2) TRANSITION FOR PROPERTIES COVERED BY 
FLOOD INSURANCE UPON EFFECTIVE DATE.— 
(A) INCREASE OF RATES OVER TIME.—In 
the case of any property described in paragraph 
(2) of section 1308(c) of the National Flood In-
surance Act of 1968, as amended by subsection 
(a) of this section, that, as of the effective date 
under paragraph (1) of this subsection, is cov-
ered under a policy for flood insurance made 
available under the national flood insurance 
program for which the chargeable premium 
rates are less than the applicable estimated risk 
premium rate under section 1307(a)(1) for the 
area in which the property is located, the Direc-
tor of the Federal Emergency Management 
Agency shall increase the chargeable premium 
rates for such property over time to such appli-
cable estimated risk premium rate under section 
1307(a)(1). 
(B) ANNUAL
INCREASE.—Such increase 
shall be made by increasing the chargeable pre-
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mium rates for the property (after application 
of any increase in the premium rates otherwise 
applicable to such property), once during the 
12-month period that begins upon the effective 
date under paragraph (1) of this subsection, 
and once every 12 months thereafter until such 
increase is accomplished, by 15 percent (or such 
lesser amount as may be necessary so that the 
chargeable rate does not exceed such applicable 
estimated risk premium rate or to comply with 
subparagraph (C)). Any increase in chargeable 
premium rates for a property pursuant to this 
paragraph shall not be considered for purposes 
of the limitation under section 1308(e) of such 
Act. 
(C) FULL ACTUARIAL RATES.—The provi-
sions of paragraph (2) of such section 1308(c) 
shall apply to such a property upon the accom-
plishment of the increase under this paragraph 
and thereafter. 
Æ 
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