‘‘(2) the development and application of hazard
identification technologies, including improved flood-
plain mapping technologies, that can be used by
Federal, State, and local governments and that the
President determines will likely result in substantial
savings over current hazard identification methods.’’.
SEC. 104. PREDISASTER HAZARD MITIGATION.
Title II (42 U.S.C. 5131–5132) is amended by add-
ing at the end the following:
‘‘SEC. 203. PREDISASTER HAZARD MITIGATION.
‘‘(a) GENERAL AUTHORITY.—The President may es-
tablish a program to provide financial assistance to States
and local governments for the purpose of implementing
predisaster hazard mitigation measures that reduce inju-
ries, loss of life, and damage and destruction of property,
including critical facilities and public infrastructure.
‘‘(b) PURPOSE OF ASSISTANCE.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), a State or local government that receives
financial assistance under this section shall use the
assistance for funding activities that are cost effec-
tive and substantially reduce the risk of future dam-
age, hardship, or suffering from a major disaster.
‘‘(2) DISSEMINATION.—The State or local gov-
ernment may use not more than 10 percent of finan-
cial assistance it receives under this section in a fis-
cal year for funding activities to disseminate infor-
mation regarding cost effective mitigation tech-
nologies (such as preferred construction practices
and materials), including establishing and maintain-
ing centers for protection against natural disasters
to carry out such dissemination.
‘‘(c) ALLOCATION OF FUNDS.—
‘‘(1) IN
GENERAL.—The amount of financial
assistance to be provided to a State, including
amounts provided to local governments of such
State, under this section in a fiscal year shall—
‘‘(A) not be less than the lesser of
$500,000 or 2.5 percent of the total funds ap-
propriated to carry out this section for such fis-
cal year; but
‘‘(B) not exceed 15 percent of such total
funds.
‘‘(d) CRITERIA.—Subject to the limitations of sub-
sections (c) and (e), in determining whether to provide as-
sistance to a State or local government under this section
and the amount of such assistance, the President shall
consider the following criteria:
‘‘(1) The clear identification of prioritized cost-
effective mitigation activities that produce meaning-
ful and definable outcomes.
‘‘(2) If the State has submitted a mitigation
program under section 201(c), the degree to which
the activities identified in paragraph (1) are consist-
ent with the State mitigation program.
‘‘(3) The opportunity to fund activities that
maximize net benefits to society.
‘‘(4) The ability of the State or local govern-
ment to fund mitigation activities.
‘‘(5) The level of interest by the private sector
to enter into a partnership to promote mitigation.
‘‘(6) Such other criteria as the President estab-
lishes in consultation with State and local govern-
ments.
‘‘(e) STATE NOMINATIONS.—
‘‘(1) IN GENERAL.—Not later than April 1 of
fiscal year 1999 and each fiscal year thereafter, the
Governor of each State may recommend to the
President not less than 5 local governments to re-
ceive assistance under this section. In making such
recommendations, the Governors shall consider the
criteria identified in subsection (d).
‘‘(2) USE.—In providing assistance to local gov-
ernments under this section, the President shall se-
lect from local governments recommended by the
Governors under this subsection.
‘‘(3) EFFECT OF FAILURE TO NOMINATE.—If a
Governor of a State fails to submit recommendations
under this subsection in a timely manner, the Presi-
dent may select, subject to the criteria in subsection
(d), any local governments of the State to receive as-
sistance under this section.
‘‘(f) SMALL IMPOVERISHED COMMUNITIES.—Not less
than 10 percent of the total financial assistance provided
under this section in a fiscal year shall be used to fund
activities in communities of 3,000 or fewer individuals that
are economically disadvantaged, as determined by the
State in which the community is located and based on cri-
teria established by the President. Notwithstanding sub-
section (g), the President may contribute up to 90 percent
of the total cost of mitigation activities in such commu-
nities.
‘‘(g) FEDERAL SHARE.—Financial assistance pro-
vided under this section may contribute up to 75 percent
of the total cost of mitigation activities approved by the
President.
‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There
is authorized to be appropriated to carry out this section
$50,000,000 for each of fiscal years 1998, 1999, and
2000.
‘‘(i) AUTHORIZATION OF SECTION 404 FUNDS.—In
addition to amounts appropriated under subsection (h),
the President may use, to carry out this section, funds
that are appropriated to carry out section 404 for post-
disaster mitigation activities that have not been obligated
within 3 years of the disaster declaration for which such
funds are appropriated.
‘‘(j) REPORT
ON STATE ADMINISTRATION.—Not
later than 1 year after the date of enactment of the Disas-
ter Mitigation Act of 1998, the President, in consultation
with State and local governments, shall transmit to Con-
gress a report recommending a process for transferring
greater authority and responsibility for administering the
assistance program authorized by this section to capable
States.’’.
SEC. 105. CONFORMING AMENDMENT.
The heading for title II is amended to read as follows:
‘‘TITLE II—DISASTER PREPARED-
NESS AND MITIGATION AS-
SISTANCE’’.
TITLE II—STREAMLINING AND
COST REDUCTION
SEC. 201. MANAGEMENT EXPENSES.
(a) IN GENERAL.—Title III (42 U.S.C. 5141–5164)
is amended by adding at the end the following:
‘‘SEC. 322. MANAGEMENT EXPENSES.
‘‘(a) IN GENERAL.—Notwithstanding any other pro-
vision of law (including any administrative rule or guid-
ance), for purposes of this title, the President shall estab-
lish by rule management cost rates for grantees and sub-
grantees. Such rates shall be used to determine contribu-
tions under section 406(a) for management and other as-
sociated expenses, which may include the costs, for per-
forming eligible work, of mobilizing and employing the Na-
tional Guard and using prison labor and other labor costs.
Such rates may be based on a percentage of assistance
provided to a grantee or subgrantee.
‘‘(b) REVIEW.—The President shall review the man-
agement cost rates established under subsection (a) not
later than 3 years after the date of establishment of such
rates and periodically thereafter.
‘‘(c) OTHER EXPENSES.—All payments for manage-
ment costs shall be in lieu of any indirect costs, adminis-
trative expenses, or any other expenses not directly
chargeable to a specific project under a major disaster,
emergency, or emergency preparedness activity or meas-
ure.’’.
(b) APPLICABILITY.—Section 322 of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act
(as added by subsection (a) of this section) shall apply
as follows:
(1) Subsection (a) shall apply to major disas-
ters declared under such Act on or after the date of
enactment of this Act. Until the date on which the
President establishes the management cost rates
under such subsection, section 406(f) shall be used
for establishing such rates.
(2) Subsections (b) and (c) shall apply to major
disasters declared under such Act on or after the
90th day following the date on which the President
establishes such rates under subsection (a) of such
section 322.
SEC. 202. ASSISTANCE TO REPAIR, RESTORE, RECON-
STRUCT, OR REPLACE DAMAGED FACILITIES.
(a) CONTRIBUTIONS.—Section 406(a) (42 U.S.C.
5172(a)) is amended to read as follows:
‘‘(a) CONTRIBUTIONS.—
‘‘(1) IN GENERAL.—The President may make
contributions—
‘‘(A) to a State or local government for the
repair, restoration, reconstruction, or replace-
ment of a public facility which is damaged or
destroyed by a major disaster and for associ-
ated expenses incurred by such government;
and
‘‘(B) subject to paragraph (2), to a person
who owns or operates a private nonprofit facil-
ity damaged or destroyed by a major disaster
for the repair, restoration, reconstruction, or re-
placement of such facility and for associated ex-
penses incurred by such person.
‘‘(2) CONDITIONS FOR ASSISTANCE TO PRIVATE
NONPROFIT FACILITIES.—The President may make
contributions to a private nonprofit facility under
paragraph (1)(B) only if the owner or operator of
the facility—
‘‘(A) has applied for a disaster loan under
section 7(b) of the Small Business Act (15
U.S.C. 636(b)); and
‘‘(B)(i) has been determined to be ineli-
gible for such a loan; or
‘‘(ii) has obtained such a loan in the maxi-
mum amount for which the Small Business Ad-
ministration determines the facility is eligible.’’.
(b) MINIMUM FEDERAL SHARE.—Section 406(b) (42
U.S.C. 5172(b)) is amended to read as follows:
‘‘(b) MINIMUM
FEDERAL
SHARE.—The Federal
share of assistance under this section shall be not less
than 75 percent of the net eligible cost of repair, restora-
tion, reconstruction, or replacement carried out under this
section.’’.
(c) 
LARGE
IN-LIEU
CONTRIBUTIONS.—Section
406(c) (42 U.S.C. 5172(c)) is amended to read as follows:
‘‘(c) LARGE IN-LIEU CONTRIBUTIONS.—
‘‘(1) FOR PUBLIC FACILITIES.—
‘‘(A) IN GENERAL.—In any case in which
a State or local government determines that the
public welfare would not be best served by re-
pairing, restoring, reconstructing, or replacing
any public facility owned or controlled by such
State or local government, the State or local
government may elect to receive, in lieu of a
contribution under subsection (a)(1)(A), a con-
tribution of 75 percent of the Federal share of
the Federal estimate of the cost of repairing,
restoring, reconstructing, or replacing such fa-
cility and of management expenses.
‘‘(B) USE OF FUNDS.—Funds contributed
to a State or local government under this para-
graph may be used to repair, restore, or expand
other eligible public facilities, to construct eligi-
ble new facilities, or to fund hazard mitigation
measures which the State or local government
determines to be necessary to meet a need for
governmental services and functions in the area
affected by the major disaster.
‘‘(2) FOR PRIVATE NONPROFIT FACILITIES.—
‘‘(A) IN GENERAL.—In any case where a
person who owns or operates a private nonprofit
facility determines that the public welfare would
not be best served by repairing, restoring, re-
constructing, or replacing such facility, such
person may elect to receive, in lieu of a con-
tribution under subsection (a)(1)(B), a con-
tribution of 75 percent of the Federal share of
the Federal estimate of the cost of repairing,
restoring, reconstructing, or replacing such fa-
cility and of management expenses.
‘‘(B) USE OF FUNDS.—Funds contributed
to a person under this paragraph may be used
to repair, restore, or expand other eligible pri-
vate nonprofit facilities owned or operated by
the person, to construct eligible new private
nonprofit facilities to be owned or operated by
the person, or to fund hazard mitigation meas-
ures that the person determines to be necessary
to meet a need for its services and functions in
the area affected by the major disaster.
‘‘(3) MODIFICATION OF FEDERAL SHARE.—The
President shall modify the Federal share of the cost
estimate provided in paragraphs (1) and (2) if the
President determines an alternative cost share will
likely reduce the total amount of Federal assistance
provided under this section. The Federal cost share
for purposes of paragraphs (1) and (2) shall not ex-
ceed 90 percent and shall not be less than 50 per-
cent.’’.
(d) NET ELIGIBLE COST.—
(1) IN GENERAL.—Section 406(e) (42 U.S.C.
5172(e)) is amended to read as follows:
‘‘(e) NET ELIGIBLE COST.—
‘‘(1) IN GENERAL.—For the purposes of this
section, the estimate of the cost of repairing, restor-
ing, reconstructing, or replacing a public facility or
private nonprofit facility on the basis of the design
of such facility as it existed immediately before the
major disaster and in conformity with current appli-
cable codes, specifications, and standards (including
floodplain management and hazard mitigation cri-
teria required by the President or by the Coastal
Barrier Resources Act (16 U.S.C. 3501 et seq.))
shall be treated as the net eligible cost of such re-
pair, restoration, reconstruction, or replacement.
Subject to paragraph (2), the President shall use the
cost estimation procedures developed under para-
graph (3) to make the estimate under this para-
graph.
‘‘(2) MODIFICATION OF NET ELIGIBLE COST.—
In the event the actual cost of repairing, restoring,
reconstructing, or replacing a facility under this sec-
tion is more than 120 percent or less than 80 per-
cent of the cost estimated under paragraph (1), the
President may determine that the net eligible cost be
the actual cost of such repair, restoration, recon-
struction, or replacement.
‘‘(3) EXPERT
PANEL.—Not later than 18
months after the date of enactment of the Disaster
Mitigation Act of 1998, the President, acting
through the Director of the Federal Emergency
Management Agency, shall establish an expert panel,
including representatives from the construction in-
dustry, to develop procedures for estimating the cost
of repairing, restoring, reconstructing, or replacing a
facility consistent with industry practices.
‘‘(4) SPECIAL RULE.—In any case in which the
facility being repaired, restored, reconstructed, or re-
placed under this section was under construction on
the date of the major disaster, the cost of repairing,
restoring, reconstructing, or replacing such facility
shall include, for purposes of this section, only those
costs which, under the contract for such construc-
tion, are the owner’s responsibility and not the con-
tractor’s responsibility.’’.
(2) EFFECTIVE DATE.—The amendment made
by paragraph (1) shall take effect on the date of en-
actment of this Act; except that paragraph (1) of
section 406(e) of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act (as amended
by paragraph (1) of this subsection) shall take effect
on the date that the procedures developed under
paragraph (3) of such section take effect.
(e) ASSOCIATED EXPENSES.—
(1) 
REPEAL.—Section 
406(f) 
(42 
U.S.C.
5172(f)) is repealed.
their predisaster primary residences or whose
predisaster residences are rendered uninhabitable as
a result of damage caused by a major disaster.
‘‘(2) DETERMINATION OF APPROPRIATE TYPES
OF ASSISTANCE.—The President shall determine ap-
propriate types of housing assistance to be provided
to disaster victims under this section based upon
considerations of cost effectiveness, convenience to
disaster victims, and such other factors as the Presi-
dent may consider appropriate. One or more types of
housing assistance may be made available, based on
the suitability and availability of the types of assist-
ance, to meet the needs of disaster victims in the
particular disaster situation.
‘‘(c) TYPES OF HOUSING ASSISTANCE.—
‘‘(1) TEMPORARY HOUSING.—
‘‘(A) FINANCIAL ASSISTANCE.—
‘‘(i) IN
GENERAL.—The President
may provide financial assistance under this
section to individuals or households to rent
alternate housing accommodations, existing
rental units, manufactured housing, rec-
reational vehicles, or other readily fab-
ricated dwellings.
‘‘(ii) AMOUNT.—The amount of as-
sistance under clause (i) shall be based on
the fair market rent for the accommoda-
tion being furnished plus the cost of any
transportation, utility hookups, or unit in-
stallation not being directly provided by
the President.
‘‘(B) DIRECT ASSISTANCE.—
‘‘(i) IN
GENERAL.—The President
may also directly provide under this section
housing units, acquired by purchase or
lease, to individuals or households who, be-
cause of a lack of available housing re-
sources, would be unable to make use of
the assistance provided under subpara-
graph (A).
‘‘(ii) PERIOD
OF
ASSISTANCE.—The
President may not provide direct assist-
ance under clause (i) with respect to a
major disaster after the expiration of the
18-month period beginning on the date of
the declaration of the major disaster by the
President, except that the President may
extend such period if the President deter-
mines that due to extraordinary cir-
cumstances an extension would be in the
public interest.
‘‘(iii) 
COLLECTION
OF
RENTAL
CHARGES.—After the expiration of the 18-
month period referred to in clause (ii), the
President may charge fair market rent for
the accommodation being provided.
‘‘(2) REPAIRS.—The President may provide fi-
nancial assistance for the repair of owner-occupied
private residences, utilities, and residential infra-
structure (such as private access routes) damaged by
a major disaster to a habitable or functioning condi-
tion if such assistance cannot be provided by vol-
untary organization assistance or insurance pro-
ceeds.
‘‘(3) REPLACEMENT.—The President may pro-
vide financial assistance for the replacement of
owner-occupied private residences damaged by a
major disaster if such assistance cannot be provided
by voluntary organization assistance or insurance
proceeds. Assistance under this paragraph shall be
limited to households with an annual income that is
less than the national median income, as determined
by the Secretary of Commerce. Assistance provided
under this paragraph shall not exceed $10,000
(based on fiscal year 1998 constant dollars). The
President may not waive any provision of Federal
law requiring the purchase of flood insurance as a
condition for the receipt of Federal disaster assist-
ance with respect to assistance provided under this
paragraph.
‘‘(4) PERMANENT HOUSING CONSTRUCTION.—
The President may provide financial assistance or
direct assistance under this section to individuals or
households to construct permanent housing in insu-
lar areas outside the continental United States and
other remote locations in cases in which—
‘‘(A) no alternative housing resources are
available;
‘‘(B) the types of temporary housing as-
sistance described in paragraph (1) are unavail-
able, infeasible, or not cost effective; and
‘‘(C) housing needs cannot be met by vol-
untary organization assistance, insurance pro-
ceeds, or disaster loan benefits available from
the Small Business Administration.
‘‘(d) TERMS AND CONDITIONS RELATING TO HOUS-
ING ASSISTANCE.—
‘‘(1) SITES.—Any readily fabricated dwelling
provided under this section shall, whenever possible,
be located on a site complete with utilities, and shall
be provided by the State or local government, by the
owner of the site, or by the occupant who was dis-
placed by the major disaster. Readily fabricated
dwellings may be located on sites provided by the
President if the President determines that such sites
would be more economical or accessible.
‘‘(2) DISPOSAL OF UNITS.—
‘‘(A) SALE TO OCCUPANTS.—
‘‘(i) IN
GENERAL.—Notwithstanding
any other provision of law, a temporary
housing unit purchased under this section
by the President for the purposes of hous-
ing disaster victims may be sold directly to
the individual or household who is occupy-
ing the unit if the individual or household
needs permanent housing.
‘‘(ii) SALES
PRICE.—Sales of tem-
porary housing units under clause (i) shall
be accomplished at prices that are fair and
equitable.
‘‘(iii) DEPOSIT OF PROCEEDS.—Not-
withstanding any other provision of law,
the proceeds of a sale under clause (i) shall
be deposited into the appropriate Disaster
Relief Fund account.
‘‘(iv) USE
OF
GSA
SERVICES.—The
President may use the services of the Gen-
eral Services Administration to accomplish
a sale under clause (i).
‘‘(B) OTHER METHODS OF DISPOSAL.—
‘‘(i) SALE.—If not disposed of under
subparagraph (A), a temporary housing
unit purchased by the President for the
purposes of housing disaster victims may
be resold.
‘‘(ii) DISPOSAL
TO
GOVERNMENTS
AND VOLUNTARY ORGANIZATIONS.—A tem-
porary housing unit described in clause (i)
may also be sold, transferred, donated, or
otherwise made available directly to a
State or other governmental entity or to a
voluntary organization for the sole purpose
of providing temporary housing to disaster
victims in major disasters and emergencies
if, as a condition of such sale, transfer, or
donation, the State, other governmental
agency, or voluntary organization agrees—
‘‘(I) to comply with the non-
discrimination provisions of section
308; and
‘‘(II) to obtain and maintain haz-
ard and flood insurance on the hous-
ing unit.
‘‘(e) FINANCIAL ASSISTANCE TO ADDRESS OTHER
NEEDS.—
‘‘(1) MEDICAL, DENTAL, AND
FUNERAL
EX-
PENSES.—The President, in consultation with the
Governor of the affected State, may provide financial
assistance under this section to an individual or
household adversely affected by a major disaster to
meet disaster-related medical, dental, and funeral
expenses if such individual or household is unable to
meet such needs through insurance proceeds or vol-
untary organization assistance.
‘‘(2) PERSONAL PROPERTY, TRANSPORTATION,
AND
OTHER
EXPENSES.—The President, in con-
sultation with the Governor of the affected State,
may provide financial assistance under this section
to an individual or household described in paragraph
(1) to address personal property, transportation, and
other necessary expenses or serious needs resulting
from the major disaster if such expenses or needs
cannot be met through insurance proceeds, voluntary
agency assistance, or through loan assistance from
the Small Business Administration.
‘‘(f) STATE ROLE.—The President shall provide for
the substantial and ongoing involvement of the affected
State in administering the assistance under this section.
‘‘(g) MAXIMUM AMOUNT OF ASSISTANCE.—No indi-
vidual or household shall receive financial assistance great-
er than $25,000 under this section with respect to a single
major disaster. Such limit shall be adjusted annually to
reflect changes in the Consumer Price Index for all Urban
Consumers published by the Department of Labor.
‘‘(h) ISSUANCE OF REGULATIONS.—The President
shall issue rules and regulations to carry out the program,
including criteria, standards, and procedures for determin-
ing eligibility for assistance.’’.
(b) CONFORMING AMENDMENT.—Section 502(a)(6)
(42 U.S.C. 5192(a)(6)) is amended by striking ‘‘tem-
porary housing’’.
(c) REPEAL OF INDIVIDUAL AND FAMILY GRANT
PROGRAMS.—Section 411 (42 U.S.C. 5178) is repealed.
SEC. 204. REPEALS.
(a) COMMUNITY DISASTER LOANS.—Section 417 (42
U.S.C. 5184) is repealed.
(b) SIMPLIFIED
PROCEDURE.—Section 422 (42
U.S.C. 5189) is repealed.
SEC. 205. STATE ADMINISTRATION OF HAZARD MITIGATION
PROGRAM.
Section 404 (42 U.S.C. 5170c) is amended by adding
at the end the following:
‘‘(c) PROGRAM ADMINISTRATION BY STATES.—
‘‘(1) IN GENERAL.—A State desiring to admin-
ister the hazard mitigation assistance program es-
tablished by this section with respect to hazard miti-
gation assistance in the State may submit to the
President an application for the delegation of such
authority.
‘‘(2) CRITERIA.—The President, in consultation
with States and local governments, shall establish
criteria for the approval of applications submitted
under paragraph (1). The criteria shall include, at a
minimum, the following:
‘‘(A) The demonstrated ability of the State
to manage the grant program under this sec-
tion.
‘‘(B) Submission of the plans required
under section 201.
‘‘(C) A demonstrated commitment to miti-
gation activities.
‘‘(3) APPROVAL.—The President shall approve
an application submitted under paragraph (1) that
meets the criteria established under paragraph (2).
‘‘(4) WITHDRAWAL
OF
APPROVAL.—If, after
approving an application of a State submitted under
paragraph (1), the President determines that the
State is not administering the hazard mitigation as-
sistance program established by this section in a
manner satisfactory to the President, the President
shall withdraw such approval.
‘‘(5) AUDITS.—The President shall provide for
periodic audits of the hazard mitigation assistance
programs administered by States under this sub-
section.’’.
SEC. 206. STATE ADMINISTRATION OF DAMAGED FACILI-
TIES PROGRAM.
(a) PILOT PROGRAM.—The President, in cooperation
with States and local governments, shall conduct a pilot
program for the purpose of determining the desirability
of State administration of parts of the assistance program
established by section 406 of the Robert T. Stafford Dis-
aster Relief and Emergency Assistance Act (42 U.S.C.
5172).
(b) STATE PARTICIPATION.—
(1) CRITERIA.—The President may establish
criteria in order to ensure the appropriate implemen-
tation of the pilot program under subsection (a).
(2) NUMBER OF STATES.—The President shall
conduct the pilot program under subsection (a) in at
least 2 States and not more than 4 States.
(c) REPORT.—Not later than 4 years after the date
of enactment of this Act, the President shall transmit to
Congress a report describing the results of the pilot pro-
gram conducted under subsection (a), including an identi-
fication of any administrative or financial benefits. Such
report shall also include recommendations on the condi-
tions, if any, under which States should be allowed the
option to administer parts of the assistance program
under section 406 of the Robert T. Stafford Disaster Re-
lief and Emergency Assistance Act (42 U.S.C. 5172).
SEC. 207. STUDY REGARDING COST REDUCTION.
Not later than 4 years after the date of enactment
of this Act, the Comptroller General of the United States
shall conduct a study to estimate the reduction in Federal
disaster assistance that has resulted and is likely to result
from the enactment of this Act.
SEC. 208. STUDY REGARDING INSURANCE FOR PUBLIC IN-
FRASTRUCTURE.
The Comptroller General of the United States shall
conduct a study to determine the current and future ex-
pected availability of insurance for public infrastructure
eligible for assistance under section 406 of the Robert T.
Stafford Disaster Relief and Emergency Assistance Act
(42 U.S.C. 5170).
TITLE III—MISCELLANEOUS
SEC. 301. TECHNICAL CORRECTION OF SHORT TITLE.
The first section (42 U.S.C. 5121 note) is amended
to read as follows:
‘‘SECTION 1. SHORT TITLE.
‘‘This Act may be cited as the ‘Robert T. Stafford
Disaster Relief and Emergency Assistance Act’.’’.
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