II 
Calendar No. 398 
112TH CONGRESS 
2D SESSION 
H. R. 5652 
IN THE SENATE OF THE UNITED STATES 
MAY 14, 2012 
Received and read the first time 
MAY 15, 2012 
Read the second time and placed on the calendar 
AN ACT 
To provide for reconciliation pursuant to section 201 of 
the concurrent resolution on the budget for fiscal year 2013. 
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 may be cited as the ‘‘Sequester Replacement 
Reconciliation Act of 2012’’. 
SEC. 2. TABLE OF CONTENTS. 
The table of contents is as follows: 
Sec. 1. Short title. 
Sec. 2. Table of contents. 
TITLE I—AGRICULTURE 
Sec. 101. Short title. 
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Sec. 102. ARRA sunset at June 30, 2012. 
Sec. 103. Categorical eligibility limited to cash assistance. 
Sec. 104. Standard utility allowances based on the receipt of energy assistance 
payments. 
Sec. 105. Employment and training; workfare. 
Sec. 106. End State bonus program for the supplemental nutrition assistance 
program. 
Sec. 107. Funding of employment and training programs. 
Sec. 108. Turn off indexing for nutrition education and obesity prevention. 
Sec. 109. Extension of Authorization of Food and Nutrition Act of 2008. 
Sec. 110. Effective dates and application of amendments. 
TITLE II—COMMITTEE ON ENERGY AND COMMERCE 
Subtitle A—Repeal of Certain ACA Funding Provisions 
Sec. 201. Repealing mandatory funding to states to establish American Health 
Benefit Exchanges. 
Sec. 202. Repealing Prevention and Public Health Fund. 
Sec. 203. Rescinding unobligated balances for CO-OP program. 
Subtitle B—Medicaid 
Sec. 211. Revision of provider tax indirect guarantee threshold. 
Sec. 212. Rebasing of State DSH allotments for fiscal year 2022. 
Sec. 213. Repeal of Medicaid and CHIP maintenance of effort requirements 
under PPACA. 
Sec. 214. Medicaid payments to territories. 
Sec. 215. Repealing bonus payments for enrollment under Medicaid and CHIP. 
TITLE III—FINANCIAL SERVICES 
Sec. 301. Table of contents. 
Subtitle A—Orderly Liquidation Fund 
Sec. 311. Repeal of liquidation authority. 
Subtitle B—Home Affordable Modification Program 
Sec. 321. Short title. 
Sec. 322. Congressional findings. 
Sec. 323. Termination of authority. 
Sec. 324. Sense of Congress. 
Subtitle C—Bureau of Consumer Financial Protection 
Sec. 331. Bringing the Bureau of Consumer Financial Protection into the reg-
ular appropriations process. 
Subtitle D—Flood Insurance Reform 
Sec. 341. Short title. 
Sec. 342. Extensions. 
Sec. 343. Mandatory purchase. 
Sec. 344. Reforms of coverage terms. 
Sec. 345. Reforms of premium rates. 
Sec. 346. Technical Mapping Advisory Council. 
Sec. 347. FEMA incorporation of new mapping protocols. 
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Sec. 348. Treatment of levees. 
Sec. 349. Privatization initiatives. 
Sec. 350. FEMA annual report on insurance program. 
Sec. 351. Mitigation assistance. 
Sec. 352. Notification to homeowners regarding mandatory purchase require-
ment applicability and rate phase-ins. 
Sec. 353. Notification to members of congress of flood map revisions and up-
dates. 
Sec. 354. Notification and appeal of map changes; notification to communities 
of establishment of flood elevations. 
Sec. 355. Notification to tenants of availability of contents insurance. 
Sec. 356. Notification to policy holders regarding direct management of policy 
by FEMA. 
Sec. 357. Notice of availability of flood insurance and escrow in RESPA good 
faith estimate. 
Sec. 358. Reimbursement for costs incurred by homeowners and communities 
obtaining letters of map amendment or revision. 
Sec. 359. Enhanced communication with certain communities during map up-
dating process. 
Sec. 360. Notification to residents newly included in flood hazard areas. 
Sec. 361. Treatment of swimming pool enclosures outside of hurricane season. 
Sec. 362. Information regarding multiple perils claims. 
Sec. 363. FEMA authority to reject transfer of policies. 
Sec. 364. Appeals. 
Sec. 365. Reserve fund. 
Sec. 366. CDBG eligibility for flood insurance outreach activities and commu-
nity building code administration grants. 
Sec. 367. Technical corrections. 
Sec. 368. Requiring competition for national flood insurance program policies. 
Sec. 369. Studies of voluntary community-based flood insurance options. 
Sec. 370. Report on inclusion of building codes in floodplain management cri-
teria. 
Sec. 371. Study on graduated risk. 
Sec. 372. Report on flood-in-progress determination. 
Sec. 373. Study on repaying flood insurance debt. 
Sec. 374. No cause of action. 
Sec. 375. Authority for the corps of engineers to provide specialized or technical 
services. 
Subtitle E—Repeal of the Office of Financial Research 
Sec. 381. Repeal of the Office of Financial Research. 
TITLE IV—COMMITTEE ON THE JUDICIARY 
Sec. 401. Short title. 
Sec. 402. Encouraging speedy resolution of claims. 
Sec. 403. Compensating patient injury. 
Sec. 404. Maximizing patient recovery. 
Sec. 405. Punitive damages. 
Sec. 406. Authorization of payment of future damages to claimants in health 
care lawsuits. 
Sec. 407. Definitions. 
Sec. 408. Effect on other laws. 
Sec. 409. State flexibility and protection of States’ rights. 
Sec. 410. Applicability; effective date. 
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TITLE V—COMMITTEE ON OVERSIGHT AND GOVERNMENT 
REFORM 
Sec. 501. Retirement contributions. 
Sec. 502. Annuity supplement. 
Sec. 503. Contributions to Thrift Savings Fund of payments for accrued or ac-
cumulated leave. 
TITLE VI—COMMITTEE ON WAYS AND MEANS 
Subtitle A—Recapture of Overpayments Resulting From Certain Federally- 
subsidized Health Insurance 
Sec. 601. Recapture of overpayments resulting from certain federally-subsidized 
health insurance. 
Subtitle B—Social Security Number Required to Claim the Refundable 
Portion of the Child Tax Credit 
Sec. 611. Social security number required to claim the refundable portion of the 
child tax credit. 
Subtitle C—Human Resources Provisions 
Sec. 621. Repeal of the program of block grants to States for social services. 
TITLE VII—SEQUESTER REPLACEMENT 
Sec. 701. Short title. 
Sec. 702. Protecting veterans programs from sequester. 
Sec. 703. Achieving $19 billion in discretionary savings. 
Sec. 704. Conforming amendments to section 314 of the Congressional Budget 
and Impoundment Control Act of 1974. 
Sec. 705. Treatment for PAYGO purposes. 
Sec. 706. Elimination of the fiscal year 2013 sequestration for defense direct 
spending. 
TITLE I—AGRICULTURE 
SEC. 101. SHORT TITLE. 
This title may be cited as the ‘‘Agricultural Reconcili-
ation Act of 2012’’. 
SEC. 102. ARRA SUNSET AT JUNE 30, 2012. 
Section 101(a)(2) of division A of the American Re-
covery and Reinvestment Act of 2009 (Public Law 111– 
5; 123 Stat. 120) is amended by striking ‘‘October 31, 
2013’’ and inserting ‘‘June 30, 2012’’. 
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SEC. 103. CATEGORICAL ELIGIBILITY LIMITED TO CASH AS-
SISTANCE. 
Section 5 of the Food and Nutrition Act of 2008 (7 
U.S.C. 2014) is amended— 
(1) in the 2d sentence of subsection (a) by 
striking ‘‘households in which each member receives 
benefits’’ and inserting ‘‘households in which each 
member receives cash assistance’’, and 
(2) in subsection (j) by striking ‘‘or who re-
ceives benefits under a State program’’ and inserting 
‘‘or who receives cash assistance under a State pro-
gram’’. 
SEC. 104. STANDARD UTILITY ALLOWANCES BASED ON THE 
RECEIPT 
OF 
ENERGY 
ASSISTANCE 
PAY-
MENTS. 
(a) STANDARD UTILITY ALLOWANCE.—Section 5 of 
the Food and Nutrition Act of 2008 (7 U.S.C. 2014) is 
amended— 
(1) in subsection (e)(6)(C) by striking clause 
(iv), and 
(2) in subsection (k) by striking paragraph (4) 
and inserting the following: 
‘‘(4) THIRD PARTY ENERGY ASSISTANCE PAY-
MENTS.—For purposes of subsection (d)(1), a pay-
ment made under a State law (other than a law re-
ferred to in paragraph (2)(G)) to provide energy as-
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sistance to a household shall be considered money 
payable directly to the household.’’. 
(b) 
CONFORMING
AMENDMENTS.—Section 
2605(f)(2) of the Low-Income Home Energy Assistance 
Act of 1981 (42 U.S.C. 8624(f)(2)) is amended— 
(1) by striking ‘‘and for purposes of deter-
mining any excess shelter expense deduction under 
section 5(e) of the Food and Nutrition Act of 2008 
(7 U.S.C. 2014(e))’’, and 
(2) in subparagraph (A) by inserting before the 
semicolon the following: ‘‘, except that such pay-
ments or allowances shall not be deemed to be ex-
pended for purposes of determining any excess shel-
ter expense deduction under section 5(e)(6) of the 
Food and Nutrition Act of 2008 (7 U.S.C. 
2014(e)(6))’’. 
SEC. 105. EMPLOYMENT AND TRAINING; WORKFARE. 
(a) ADMINISTRATIVE COST-SHARING FOR EMPLOY-
MENT AND TRAINING PROGRAMS.— 
(1) IN GENERAL.—Section 16 of the Food and 
Nutrition Act of 2008 (7 U.S.C. 2025) is amend-
ed— 
(A) in subsection (a) by inserting ‘‘(other 
than a program carried out under section 
6(d)(4) or section 20)’’ after ‘‘supplemental nu-
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trition assistance program’’ the 1st place it ap-
pears, and 
(B) in subsection (h)— 
(i) by striking paragraphs (2) and (3), 
and 
(ii) by redesignating paragraphs (4) 
and (5) as paragraphs (2) and (3), respec-
tively. 
(2) CONFORMING AMENDMENTS.— 
(A) Section 17(b)(1)(B)(iv)(III)(hh) of the 
Food and Nutrition Act of 2008 (7 U.S.C. 
2026(b)(1)(B)(iv)(III)(hh)) 
is 
amended 
by 
striking ‘‘(g), (h)(2), or (h)(3)’’ and inserting 
‘‘or (g)’’. 
(B) Section 22(d)(1)(B)(ii) of the Food 
and 
Nutrition 
Act 
of 
2008 
(7 
U.S.C. 
2031(d)(1)(B)(ii)) is amended is amended by 
striking ‘‘, (g), (h)(2), and (h)(3)’’ and insert-
ing ‘‘and (g)’’. 
(b) ADMINISTRATIVE
COST-SHARING
AND
REIM-
BURSEMENTS FOR WORKFARE.—Section 20 of the Food 
and Nutrition Act of 2008 (7 U.S.C. 2029) is amended 
by striking subsection (g). 
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SEC. 106. END STATE BONUS PROGRAM FOR THE SUPPLE-
MENTAL NUTRITION ASSISTANCE PROGRAM. 
Section 16 of the Food and Nutrition Act of 2008 
(7 U.S.C. 2025) is amended by striking subsection (d). 
SEC. 107. FUNDING OF EMPLOYMENT AND TRAINING PRO-
GRAMS. 
For purposes of fiscal year 2013, the reference to 
$90,000,000 in section 16(h)(1)(A) of the Food and Nu-
trition Act of 2008 (7 U.S.C. 2025(h)(1)(A)) shall be 
deemed to be a reference to $79,000,000. 
SEC. 108. TURN OFF INDEXING FOR NUTRITION EDU-
CATION AND OBESITY PREVENTION. 
Section 28(d) of the Food and Nutrition Act of 2008 
(7 U.S.C. 2037(d)) is amended by striking ‘‘years—’’ and 
all that follows through the period at the end, and insert-
ing ‘‘years, $375,000,000.’’. 
SEC. 109. EXTENSION OF AUTHORIZATION OF FOOD AND 
NUTRITION ACT OF 2008. 
Section 18(a)(1) of the Food and Nutrition Act of 
2008 (7 U.S.C. 2027(a)(1)) is amended by striking 
‘‘2012’’ and inserting ‘‘2013’’. 
SEC. 110. EFFECTIVE DATES AND APPLICATION OF AMEND-
MENTS. 
(a) GENERAL EFFECTIVE DATE.—Except as pro-
vided in subsection (b), this title and the amendments 
made by this title shall take effect on October 1, 2012, 
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and shall apply only with respect to certification periods 
that begin on or after such date. 
(b) SPECIAL EFFECTIVE DATE.—Section 107 and 
the amendments made by sections 102, 103, 104, and 109 
shall take effect on the date of the enactment of this Act 
and shall apply only with respect to certification periods 
that begin on or after such date. 
TITLE II—COMMITTEE ON 
ENERGY AND COMMERCE 
Subtitle A—Repeal of Certain ACA 
Funding Provisions 
SEC. 201. REPEALING MANDATORY FUNDING TO STATES TO 
ESTABLISH AMERICAN HEALTH BENEFIT EX-
CHANGES. 
(a) IN GENERAL.—Section 1311(a) of the Patient 
Protection and Affordable Care Act (42 U.S.C. 18031(a)) 
is repealed. 
(b) RESCISSION OF UNOBLIGATED FUNDS.—Of the 
funds made available under such section 1311(a), the un-
obligated balance is rescinded. 
SEC. 202. REPEALING PREVENTION AND PUBLIC HEALTH 
FUND. 
(a) IN GENERAL.—Section 4002 of the Patient Pro-
tection and Affordable Care Act (42 U.S.C. 300u–11) is 
repealed. 
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(b) RESCISSION OF UNOBLIGATED FUNDS.—Of the 
funds made available by such section 4002, the unobli-
gated balance is rescinded. 
SEC. 203. RESCINDING UNOBLIGATED BALANCES FOR CO- 
OP PROGRAM. 
Of the funds made available under section 1322(g) 
of the Patient Protection and Affordable Care Act (42 
U.S.C. 18042(g)), the unobligated balance is rescinded. 
Subtitle B—Medicaid 
SEC. 211. REVISION OF PROVIDER TAX INDIRECT GUAR-
ANTEE THRESHOLD. 
Section 1903(w)(4)(C)(ii) of the Social Security Act 
(42 U.S.C. 1396b(w)(4)(C)(ii)) is amended by inserting 
‘‘and for portions of fiscal years beginning on or after Oc-
tober 1, 2012,’’ after ‘‘October 1, 2011,’’. 
SEC. 212. REBASING OF STATE DSH ALLOTMENTS FOR FIS-
CAL YEAR 2022. 
Section 1923(f) of the Social Security Act (42 U.S.C. 
1396r–4(f)) is amended— 
(1) by redesignating paragraph (9) as para-
graph (10); 
(2) in paragraph (3)(A) by striking ‘‘para-
graphs (6), (7), and (8)’’ and inserting ‘‘paragraphs 
(6), (7), (8), and (9)’’; and 
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(3) by inserting after paragraph (8) the fol-
lowing new paragraph: 
‘‘(9) REBASING OF STATE DSH ALLOTMENTS 
FOR
FISCAL
YEAR
2022.—With respect to fiscal 
2022, for purposes of applying paragraph (3)(A) to 
determine the DSH allotment for a State, the 
amount of the DSH allotment for the State under 
paragraph (3) for fiscal year 2021 shall be treated 
as if it were such amount as reduced under para-
graph (7).’’. 
SEC. 213. REPEAL OF MEDICAID AND CHIP MAINTENANCE 
OF EFFORT REQUIREMENTS UNDER PPACA. 
(a) REPEAL OF PPACA MEDICAID MOE.—Section 
1902 of the Social Security Act (42 U.S.C. 1396a) is 
amended by striking subsection (gg). 
(b) REPEAL
OF
PPACA CHIP MOE.—Section 
2105(d)(3) of the Social Security Act (42 U.S.C. 
1397ee(d)(3)) is amended— 
(1) by striking subparagraph (A); 
(2) by redesignating subparagraphs (B) and 
(C) as subparagraphs (A) and (B), respectively; and 
(3) in the paragraph heading, by striking 
‘‘CONTINUATION
OF
ELIGIBILITY
STANDARDS
FOR 
CHILDREN UNTIL OCTOBER 1, 2019’’ and inserting 
‘‘CONTINUITY OF COVERAGE’’. 
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(c) CONFORMING AMENDMENTS.— 
(1) Section 1902(a) of the Social Security Act 
(42 U.S.C. 1396a(a)) is amended by striking para-
graph (74). 
(2) Effective January 1, 2014, paragraph (14) 
of section 1902(e) (as added by section 2002(a) of 
Public Law 111–148) is amended by striking the 
third sentence of subparagraph (A). 
(d) EFFECTIVE DATE.—Except as provided in sub-
section (c)(2), the amendments made by this section shall 
take effect on the date of the enactment of this section. 
SEC. 214. MEDICAID PAYMENTS TO TERRITORIES. 
(a) LIMIT ON PAYMENTS.—Section 1108(g) of the 
Social Security Act (42 U.S.C. 1308(g)) is amended— 
(1) in paragraph (2)— 
(A) by striking ‘‘paragraphs (3) and (5)’’; 
and 
(B) by inserting ‘‘paragraph (3)’’ after 
‘‘and subject to’’; 
(2) in paragraph (4), by striking ‘‘(3), and’’ 
and all that follows through ‘‘of this subsection’’ and 
inserting ‘‘and (3) of this subsection’’; and 
(3) by striking paragraph (5). 
(b) FMAP.—The first sentence of section 1905(b) of 
the Social Security Act (42 U.S.C. 1396d(b)) is amended 
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by striking ‘‘shall be 55 percent’’ and inserting ‘‘shall be 
50 percent’’. 
SEC. 215. REPEALING BONUS PAYMENTS FOR ENROLL-
MENT UNDER MEDICAID AND CHIP. 
(a) IN GENERAL.—Paragraphs (3) and (4) of section 
2105(a) of the Social Security Act (42 U.S.C. 1397ee(a)) 
are repealed. 
(b) RESCISSION OF UNOBLIGATED FUNDS.—Of the 
funds made available by section 2105(a)(3) of the Social 
Security Act, the unobligated balance is rescinded. 
(c) CONFORMING CHANGES.— 
(1) AVAILABILITY OF EXCESS FUNDS FOR PER-
FORMANCE
BONUSES.—Section 2104(n)(2) of the 
Social Security Act (42 U.S.C. 1397dd(n)(2)) is 
amended by striking subparagraph (D). 
(2) OUTREACH OR COVERAGE BENCHMARKS.— 
Section 2111(b)(3) of the Social Security Act (42 
U.S.C. 1397kk(b)(3)) is amended— 
(A) in subparagraph (A)— 
(i) in clause (i), by inserting ‘‘or’’ 
after the semicolon at the end; and 
(ii) by striking clause (ii); and 
(B) by striking subparagraph (C). 
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TITLE III—FINANCIAL SERVICES 
SEC. 301. TABLE OF CONTENTS. 
The table of contents for this title is as follows: 
TITLE III—FINANCIAL SERVICES 
Sec. 301. Table of contents. 
Subtitle A—Orderly Liquidation Fund 
Sec. 311. Repeal of liquidation authority. 
Subtitle B—Home Affordable Modification Program 
Sec. 321. Short title. 
Sec. 322. Congressional findings. 
Sec. 323. Termination of authority. 
Sec. 324. Sense of Congress. 
Subtitle C—Bureau of Consumer Financial Protection 
Sec. 331. Bringing the Bureau of Consumer Financial Protection into the reg-
ular appropriations process. 
Subtitle D—Flood Insurance Reform 
Sec. 341. Short title. 
Sec. 342. Extensions. 
Sec. 343. Mandatory purchase. 
Sec. 344. Reforms of coverage terms. 
Sec. 345. Reforms of premium rates. 
Sec. 346. Technical Mapping Advisory Council. 
Sec. 347. FEMA incorporation of new mapping protocols. 
Sec. 348. Treatment of levees. 
Sec. 349. Privatization initiatives. 
Sec. 350. FEMA annual report on insurance program. 
Sec. 351. Mitigation assistance. 
Sec. 352. Notification to homeowners regarding mandatory purchase require-
ment applicability and rate phase-ins. 
Sec. 353. Notification to members of congress of flood map revisions and up-
dates. 
Sec. 354. Notification and appeal of map changes; notification to communities 
of establishment of flood elevations. 
Sec. 355. Notification to tenants of availability of contents insurance. 
Sec. 356. Notification to policy holders regarding direct management of policy 
by FEMA. 
Sec. 357. Notice of availability of flood insurance and escrow in RESPA good 
faith estimate. 
Sec. 358. Reimbursement for costs incurred by homeowners and communities 
obtaining letters of map amendment or revision. 
Sec. 359. Enhanced communication with certain communities during map up-
dating process. 
Sec. 360. Notification to residents newly included in flood hazard areas. 
Sec. 361. Treatment of swimming pool enclosures outside of hurricane season. 
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Sec. 362. Information regarding multiple perils claims. 
Sec. 363. FEMA authority to reject transfer of policies. 
Sec. 364. Appeals. 
Sec. 365. Reserve fund. 
Sec. 366. CDBG eligibility for flood insurance outreach activities and commu-
nity building code administration grants. 
Sec. 367. Technical corrections. 
Sec. 368. Requiring competition for national flood insurance program policies. 
Sec. 369. Studies of voluntary community-based flood insurance options. 
Sec. 370. Report on inclusion of building codes in floodplain management cri-
teria. 
Sec. 371. Study on graduated risk. 
Sec. 372. Report on flood-in-progress determination. 
Sec. 373. Study on repaying flood insurance debt. 
Sec. 374. No cause of action. 
Sec. 375. Authority for the corps of engineers to provide specialized or technical 
services. 
Subtitle E—Repeal of the Office of Financial Research 
Sec. 381. Repeal of the Office of Financial Research. 
Subtitle A—Orderly Liquidation 
Fund 
SEC. 311. REPEAL OF LIQUIDATION AUTHORITY. 
(a) IN GENERAL.—Title II of the Dodd-Frank Wall 
Street Reform and Consumer Protection Act is hereby re-
pealed and any Federal law amended by such title shall, 
on and after the date of enactment of this Act, be effective 
as if title II of the Dodd-Frank Wall Street Reform and 
Consumer Protection Act had not been enacted. 
(b) CONFORMING AMENDMENTS.— 
(1) DODD-FRANK WALL STREET REFORM AND 
CONSUMER
PROTECTION
ACT.—The Dodd-Frank 
Wall Street Reform and Consumer Protection Act is 
amended— 
(A) in the table of contents for such Act, 
by striking all items relating to title II; 
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(B) in section 165(d)(6), by striking ‘‘, a 
receiver appointed under title II,’’; 
(C) in section 716(g), by striking ‘‘or a 
covered financial company under title II’’; 
(D) in section 1105(e)(5), by striking 
‘‘amount of any securities issued under that 
chapter 31 for such purpose shall be treated in 
the same manner as securities issued under sec-
tion 208(n)(5)(E)’’ and inserting ‘‘issuances of 
such securities under that chapter 31 for such 
purpose shall by treated as public debt trans-
actions of the United States, and the proceeds 
from the sale of any obligations acquired by the 
Secretary under this paragraph shall be depos-
ited into the Treasury of the United States as 
miscellaneous receipts’’; and 
(E) in section 1106(c)(2), by amending 
subparagraph (A) to read as follows: 
‘‘(A) require the company to file a petition 
for bankruptcy under section 301 of title 11, 
United States Code; or’’. 
(2) FEDERAL DEPOSIT INSURANCE ACT.—Sec-
tion 10(b)(3) of the Federal Deposit Insurance Act 
(12 U.S.C. 1820(b)(3)) is amended by striking ‘‘, or 
of such nonbank financial company supervised by 
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the Board of Governors or bank holding company 
described in section 165(a) of the Financial Stability 
Act of 2010, for the purpose of implementing its au-
thority to provide for orderly liquidation of any such 
company under title II of that Act’’. 
(3) FEDERAL RESERVE ACT.—Section 13(3) of 
the Federal Reserve Act is amended— 
(A) in subparagraph (B)— 
(i) in clause (ii), by striking ‘‘, resolu-
tion under title II of the Dodd-Frank Wall 
Street Reform and Consumer Protection 
Act, or’’ and inserting ‘‘or is subject to 
resolution under’’; and 
(ii) in clause (iii), by striking ‘‘, reso-
lution under title II of the Dodd-Frank 
Wall Street Reform and Consumer Protec-
tion Act, or’’ and inserting ‘‘or resolution 
under’’; and 
(B) by striking subparagraph (E). 
Subtitle B—Home Affordable 
Modification Program 
SEC. 321. SHORT TITLE. 
This subtitle may be cited as the ‘‘HAMP Termi-
nation Act of 2012’’. 
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SEC. 322. CONGRESSIONAL FINDINGS. 
The Congress finds the following: 
(1) According to the Department of the Treas-
ury— 
(A) the Home Affordable Modification Pro-
gram (HAMP) is designed to ‘‘help as many as 
3 to 4 million financially struggling homeowners 
avoid foreclosure by modifying loans to a level 
that is affordable for borrowers now and sus-
tainable over the long term’’; and 
(B) as of February 2012, only 782,609 ac-
tive permanent mortgage modifications were 
made under HAMP. 
(2) Many homeowners whose HAMP modifica-
tions were canceled suffered because they made fu-
tile payments and some of those homeowners were 
even forced into foreclosure. 
(3) The Special Inspector General for TARP 
reported that HAMP ‘‘benefits only a small portion 
of distressed homeowners, offers others little more 
than false hope, and in certain cases causes more 
harm than good’’. 
(4) Approximately $30 billion was obligated by 
the Department of the Treasury to HAMP, however, 
approximately only $2.54 billion has been disbursed. 
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(5) Terminating HAMP would save American 
taxpayers approximately $2.84 billion, according to 
the Congressional Budget Office. 
SEC. 323. TERMINATION OF AUTHORITY. 
Section 120 of the Emergency Economic Stabilization 
Act of 2008 (12 U.S.C. 5230) is amended by adding at 
the end the following new subsection: 
‘‘(c) TERMINATION
OF AUTHORITY TO PROVIDE 
NEW ASSISTANCE UNDER
THE HOME AFFORDABLE 
MODIFICATION PROGRAM.— 
‘‘(1) IN GENERAL.—Except as provided under 
paragraph (2), after the date of the enactment of 
this subsection the Secretary may not provide any 
assistance under the Home Affordable Modification 
Program under the Making Home Affordable initia-
tive of the Secretary, authorized under this Act, on 
behalf of any homeowner. 
‘‘(2) PROTECTION OF EXISTING OBLIGATIONS 
ON BEHALF OF HOMEOWNERS ALREADY EXTENDED 
AN
OFFER
TO
PARTICIPATE
IN
THE
PROGRAM.— 
Paragraph (1) shall not apply with respect to assist-
ance provided on behalf of a homeowner who, before 
the date of the enactment of this subsection, was ex-
tended an offer to participate in the Home Afford-
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able Modification Program on a trial or permanent 
basis. 
‘‘(3) DEFICIT REDUCTION.— 
‘‘(A) USE OF UNOBLIGATED FUNDS.—Not-
withstanding any other provision of this title, 
the amounts described in subparagraph (B) 
shall not be available after the date of the en-
actment of this subsection for obligation or ex-
penditure under the Home Affordable Modifica-
tion Program of the Secretary, but should be 
covered into the General Fund of the Treasury 
and should be used only for reducing the budg-
et deficit of the Federal Government. 
‘‘(B) IDENTIFICATION
OF
UNOBLIGATED 
FUNDS.—The amounts described in this sub-
paragraph are any amounts made available 
under title I of the Emergency Economic Sta-
bilization Act of 2008 that— 
‘‘(i) have been allocated for use, but 
not yet obligated as of the date of the en-
actment of this subsection, under the 
Home Affordable Modification Program of 
the Secretary; and 
‘‘(ii) are not necessary for providing 
assistance under such Program on behalf 
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of homeowners who, pursuant to para-
graph (2), may be provided assistance 
after the date of the enactment of this sub-
section. 
‘‘(4) STUDY OF USE OF PROGRAM BY MEMBERS 
OF
THE
ARMED
FORCES, VETERANS, AND
GOLD 
STAR RECIPIENTS.— 
‘‘(A) STUDY.—The Secretary shall conduct 
a study to determine the extent of usage of the 
Home Affordable Modification Program by, and 
the impact of such Program on, covered home-
owners. 
‘‘(B) REPORT.—Not later than the expira-
tion of the 90-day period beginning on the date 
of the enactment of this subsection, the Sec-
retary shall submit to the Congress a report 
setting forth the results of the study under sub-
paragraph (A) and identifying best practices, 
derived from studying the Home Affordable 
Modification Program, that could be applied to 
existing mortgage assistance programs available 
to covered homeowners. 
‘‘(C) COVERED
HOMEOWNER.—For pur-
poses of this subsection, the term ‘covered 
homeowner’ means a homeowner who is— 
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‘‘(i) a member of the Armed Forces of 
the United States on active duty or the 
spouse or parent of such a member; 
‘‘(ii) a veteran, as such term is de-
fined in section 101 of title 38, United 
States Code; or 
‘‘(iii) eligible to receive a Gold Star 
lapel pin under section 1126 of title 10, 
United States Code, as a widow, parent, or 
next of kin of a member of the Armed 
Forces person who died in a manner de-
scribed in subsection (a) of such section. 
‘‘(5) PUBLICATION OF MEMBER AVAILABILITY 
FOR ASSISTANCE.—Not later than 5 days after the 
date of the enactment of this subsection, the Sec-
retary of the Treasury shall publish to its Website 
on the World Wide Web in a prominent location, 
large point font, and boldface type the following 
statement: ‘The Home Affordable Modification Pro-
gram (HAMP) has been terminated. If you are hav-
ing trouble paying your mortgage and need help con-
tacting your lender or servicer for purposes of nego-
tiating or acquiring a loan modification, please con-
tact your Member of Congress to assist you in con-
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tacting your lender or servicer for the purpose of ne-
gotiating or acquiring a loan modification.’. 
‘‘(6) NOTIFICATION TO HAMP APPLICANTS RE-
QUIRED.—Not later than 30 days after the date of 
the enactment of this subsection, the Secretary of 
the Treasury shall inform each individual who ap-
plied for the Home Affordable Modification Program 
and will not be considered for a modification under 
such Program due to termination of such Program 
under this subsection— 
‘‘(A) that such Program has been termi-
nated; 
‘‘(B) that loan modifications under such 
Program are no longer available; 
‘‘(C) of the name and contact information 
of such individual’s Member of Congress; and 
‘‘(D) that the individual should contact his 
or her Member of Congress to assist the indi-
vidual in contacting the individual’s lender or 
servicer for the purpose of negotiating or ac-
quiring a loan modification.’’. 
SEC. 324. SENSE OF CONGRESS. 
The Congress encourages banks to work with home-
owners to provide loan modifications to those that are eli-
gible. The Congress also encourages banks to work and 
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assist homeowners and prospective homeowners with fore-
closure prevention programs and information on loan 
modifications. 
Subtitle C—Bureau of Consumer 
Financial Protection 
SEC. 331. BRINGING THE BUREAU OF CONSUMER FINAN-
CIAL PROTECTION INTO THE REGULAR AP-
PROPRIATIONS PROCESS. 
Section 1017 of the Consumer Financial Protection 
Act of 2010 is amended— 
(1) in subsection (a)— 
(A) by amending the heading of such sub-
section to read as follows: ‘‘BUDGET, FINAN-
CIAL MANAGEMENT, AND AUDIT.—’’; 
(B) by striking paragraphs (1), (2), and 
(3); 
(C) by redesignating paragraphs (4) and 
(5) as paragraphs (1) and (2), respectively; and 
(D) by striking subparagraphs (E) and (F) 
of paragraph (1), as so redesignated; 
(2) by striking subsections (b), (c), and (d); 
(3) by redesignating subsection (e) as sub-
section (b); and 
(4) in subsection (b), as so redesignated— 
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(A) by striking paragraphs (1), (2), and 
(3) and inserting the following: 
‘‘(1) AUTHORIZATION
OF
APPROPRIATIONS.— 
There 
is 
authorized 
to 
be 
appropriated 
$200,000,000 to carry out this title for each of fiscal 
years 2012 and 2013.’’; and 
(B) by redesignating paragraph (4) as 
paragraph (2). 
Subtitle D—Flood Insurance 
Reform 
SEC. 341. SHORT TITLE. 
This subtitle may be cited as the ‘‘Flood Insurance 
Reform Act of 2012’’. 
SEC. 342. EXTENSIONS. 
(a) EXTENSION OF PROGRAM.—Section 1319 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4026) 
is amended by striking ‘‘the earlier of the date of the en-
actment into law of an Act that specifically amends the 
date specified in this section or May 31, 2012’’ and insert-
ing ‘‘September 30, 2016’’. 
(b) EXTENSION OF FINANCING.—Section 1309(a) of 
such Act (42 U.S.C. 4016(a)) is amended by striking ‘‘the 
earlier of the date of the enactment into law of an Act 
that specifically amends the date specified in this section 
or May 31, 2012’’ and inserting ‘‘September 30, 2016’’. 
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SEC. 343. MANDATORY PURCHASE. 
(a) AUTHORITY TO TEMPORARILY SUSPEND MANDA-
TORY PURCHASE REQUIREMENT.— 
(1) IN GENERAL.—Section 102 of the Flood 
Disaster Protection Act of 1973 (42 U.S.C. 4012a) 
is amended by adding at the end the following new 
subsection: 
‘‘(i) AUTHORITY TO TEMPORARILY SUSPEND MAN-
DATORY PURCHASE REQUIREMENT.— 
‘‘(1) FINDING BY ADMINISTRATOR THAT AREA 
IS AN ELIGIBLE AREA.—For any area, upon a re-
quest submitted to the Administrator by a local gov-
ernment authority having jurisdiction over any por-
tion of the area, the Administrator shall make a 
finding of whether the area is an eligible area under 
paragraph (3). If the Administrator finds that such 
area is an eligible area, the Administrator shall, in 
the discretion of the Administrator, designate a pe-
riod during which such finding shall be effective, 
which shall not be longer in duration than 12 
months. 
‘‘(2) SUSPENSION
OF
MANDATORY
PURCHASE 
REQUIREMENT.—If the Administrator makes a find-
ing under paragraph (1) that an area is an eligible 
area under paragraph (3), during the period speci-
fied in the finding, the designation of such eligible 
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area as an area having special flood hazards shall 
not be effective for purposes of subsections (a), (b), 
and (e) of this section, and section 202(a) of this 
Act. Nothing in this paragraph may be construed to 
prevent any lender, servicer, regulated lending insti-
tution, Federal agency lender, the Federal National 
Mortgage Association, or the Federal Home Loan 
Mortgage Corporation, at the discretion of such enti-
ty, from requiring the purchase of flood insurance 
coverage in connection with the making, increasing, 
extending, or renewing of a loan secured by im-
proved real estate or a mobile home located or to be 
located in such eligible area during such period or 
a lender or servicer from purchasing coverage on be-
half of a borrower pursuant to subsection (e). 
‘‘(3) ELIGIBLE AREAS.—An eligible area under 
this paragraph is an area that is designated or will, 
pursuant to any issuance, revision, updating, or 
other change in flood insurance maps that takes ef-
fect on or after the date of the enactment of the 
Flood Insurance Reform Act of 2012, become des-
ignated as an area having special flood hazards and 
that meets any one of the following 3 requirements: 
‘‘(A) AREAS WITH NO HISTORY OF SPE-
CIAL FLOOD HAZARDS.—The area does not in-
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clude any area that has ever previously been 
designated as an area having special flood haz-
ards. 
‘‘(B) AREAS
WITH
FLOOD
PROTECTION 
SYSTEMS
UNDER
IMPROVEMENTS.—The area 
was intended to be protected by a flood protec-
tion system— 
‘‘(i) that has been decertified, or is re-
quired to be certified, as providing protec-
tion for the 100-year frequency flood 
standard; 
‘‘(ii) that is being improved, con-
structed, or reconstructed; and 
‘‘(iii) for which the Administrator has 
determined measurable progress toward 
completion of such improvement, construc-
tion, reconstruction is being made and to-
ward securing financial commitments suffi-
cient to fund such completion. 
‘‘(C) AREAS
FOR
WHICH
APPEAL
HAS 
BEEN FILED.—An area for which a community 
has appealed designation of the area as having 
special flood hazards in a timely manner under 
section 1363. 
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‘‘(4) EXTENSION OF DELAY.—Upon a request 
submitted by a local government authority having 
jurisdiction over any portion of the eligible area, the 
Administrator may extend the period during which a 
finding under paragraph (1) shall be effective, ex-
cept that— 
‘‘(A) each such extension under this para-
graph shall not be for a period exceeding 12 
months; and 
‘‘(B) for any area, the cumulative number 
of such extensions may not exceed 2. 
‘‘(5) ADDITIONAL
EXTENSION
FOR
COMMU-
NITIES MAKING MORE THAN ADEQUATE PROGRESS 
ON FLOOD PROTECTION SYSTEM.— 
‘‘(A) EXTENSION.— 
‘‘(i) AUTHORITY.—Except as provided 
in subparagraph (B), in the case of an eli-
gible area for which the Administrator has, 
pursuant to paragraph (4), extended the 
period of effectiveness of the finding under 
paragraph (1) for the area, upon a request 
submitted by a local government authority 
having jurisdiction over any portion of the 
eligible area, if the Administrator finds 
that more than adequate progress has been 
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made on the construction of a flood protec-
tion system for such area, as determined in 
accordance with the last sentence of sec-
tion 1307(e) of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4014(e)), the 
Administrator may, in the discretion of the 
Administrator, further extend the period 
during which the finding under paragraph 
(1) shall be effective for such area for an 
additional 12 months. 
‘‘(ii) LIMIT.—For any eligible area, 
the cumulative number of extensions under 
this subparagraph may not exceed 2. 
‘‘(B) EXCLUSION FOR NEW MORTGAGES.— 
‘‘(i) 
EXCLUSION.—Any 
extension 
under subparagraph (A) of this paragraph 
of a finding under paragraph (1) shall not 
be effective with respect to any excluded 
property after the origination, increase, ex-
tension, or renewal of the loan referred to 
in clause (ii)(II) for the property. 
‘‘(ii) EXCLUDED
PROPERTIES.—For 
purposes of this subparagraph, the term 
‘excluded property’ means any improved 
real estate or mobile home— 
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‘‘(I) that is located in an eligible 
area; and 
‘‘(II) for which, during the period 
that any extension under subpara-
graph (A) of this paragraph of a find-
ing under paragraph (1) is otherwise 
in effect for the eligible area in which 
such property is located— 
‘‘(aa) a loan that is secured 
by the property is originated; or 
‘‘(bb) any existing loan that 
is secured by the property is in-
creased, extended, or renewed. 
‘‘(6) RULE
OF
CONSTRUCTION.—Nothing in 
this subsection may be construed to affect the appli-
cability of a designation of any area as an area hav-
ing special flood hazards for purposes of the avail-
ability of flood insurance coverage, criteria for land 
management and use, notification of flood hazards, 
eligibility for mitigation assistance, or any other pur-
pose or provision not specifically referred to in para-
graph (2). 
‘‘(7) REPORTS.—The Administrator shall, in 
each annual report submitted pursuant to section 
1320, include information identifying each finding 
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under paragraph (1) by the Administrator during 
the preceding year that an area is an area having 
special flood hazards, the basis for each such find-
ing, any extensions pursuant to paragraph (4) of the 
periods of effectiveness of such findings, and the 
reasons for such extensions.’’. 
(2) NO REFUNDS.—Nothing in this subsection 
or the amendments made by this subsection may be 
construed to authorize or require any payment or re-
fund for flood insurance coverage purchased for any 
property that covered any period during which such 
coverage is not required for the property pursuant to 
the applicability of the amendment made by para-
graph (1). 
(b) TERMINATION OF FORCE-PLACED INSURANCE.— 
Section 102(e) of the Flood Disaster Protection Act of 
1973 (42 U.S.C. 4012a(e)) is amended— 
(1) in paragraph (2), by striking ‘‘insurance.’’ 
and inserting ‘‘insurance, including premiums or 
fees incurred for coverage beginning on the date on 
which flood insurance coverage lapsed or did not 
provide a sufficient coverage amount.’’; 
(2) by redesignating paragraphs (3) and (4) as 
paragraphs (5) and 6), respectively; and 
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(3) by inserting after paragraph (2) the fol-
lowing new paragraphs: 
‘‘(3) TERMINATION OF FORCE-PLACED INSUR-
ANCE.—Within 30 days of receipt by the lender or 
servicer of a confirmation of a borrower’s existing 
flood insurance coverage, the lender or servicer 
shall— 
‘‘(A) terminate the force-placed insurance; 
and 
‘‘(B) refund to the borrower all force- 
placed insurance premiums paid by the bor-
rower during any period during which the bor-
rower’s flood insurance coverage and the force- 
placed flood insurance coverage were each in ef-
fect, and any related fees charged to the bor-
rower with respect to the force-placed insurance 
during such period. 
‘‘(4) SUFFICIENCY OF DEMONSTRATION.—For 
purposes of confirming a borrower’s existing flood 
insurance coverage, a lender or servicer for a loan 
shall accept from the borrower an insurance policy 
declarations page that includes the existing flood in-
surance policy number and the identity of, and con-
tact information for, the insurance company or 
agent.’’. 
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(c) USE OF PRIVATE INSURANCE TO SATISFY MAN-
DATORY PURCHASE REQUIREMENT.—Section 102(b) of 
the Flood Disaster Protection Act of 1973 (42 U.S.C. 
4012a(b)) is amended— 
(1) in paragraph (1)— 
(A) by striking ‘‘lending institutions not to 
make’’ and inserting ‘‘lending institutions— 
‘‘(A) not to make’’; 
(B) in subparagraph (A), as designated by 
subparagraph (A) of this paragraph, by striking 
‘‘less.’’ and inserting ‘‘less; and’’; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(B) to accept private flood insurance as 
satisfaction of the flood insurance coverage re-
quirement under subparagraph (A) if the cov-
erage provided by such private flood insurance 
meets the requirements for coverage under such 
subparagraph.’’; 
(2) in paragraph (2), by inserting after ‘‘pro-
vided in paragraph (1).’’ the following new sentence: 
‘‘Each Federal agency lender shall accept private 
flood insurance as satisfaction of the flood insurance 
coverage requirement under the preceding sentence 
if the flood insurance coverage provided by such pri-
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vate flood insurance meets the requirements for cov-
erage under such sentence.’’; 
(3) in paragraph (3), in the matter following 
subparagraph (B), by adding at the end the fol-
lowing new sentence: ‘‘The Federal National Mort-
gage Association and the Federal Home Loan Mort-
gage Corporation shall accept private flood insurance 
as satisfaction of the flood insurance coverage re-
quirement under the preceding sentence if the flood 
insurance coverage provided by such private flood in-
surance meets the requirements for coverage under 
such sentence.’’; and 
(4) by adding at the end the following new 
paragraph: 
‘‘(5) PRIVATE FLOOD INSURANCE DEFINED.— 
In this subsection, the term ‘private flood insurance’ 
means a contract for flood insurance coverage al-
lowed for sale under the laws of any State.’’. 
SEC. 344. REFORMS OF COVERAGE TERMS. 
(a) MINIMUM DEDUCTIBLES FOR CLAIMS.—Section 
1312 of the National Flood Insurance Act of 1968 (42 
U.S.C. 4019) is amended— 
(1) by striking ‘‘The Director is’’ and inserting 
the following: ‘‘(a) IN GENERAL.—The Adminis-
trator is’’; and 
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(2) by adding at the end the following: 
‘‘(b) MINIMUM ANNUAL DEDUCTIBLES.— 
‘‘(1) SUBSIDIZED RATE PROPERTIES.—For any 
structure that is covered by flood insurance under 
this title, and for which the chargeable rate for such 
coverage is less than the applicable estimated risk 
premium rate under section 1307(a)(1) for the area 
(or subdivision thereof) in which such structure is 
located, the minimum annual deductible for damage 
to or loss of such structure shall be $2,000. 
‘‘(2) ACTUARIAL RATE PROPERTIES.—For any 
structure that is covered by flood insurance under 
this title, for which the chargeable rate for such cov-
erage is not less than the applicable estimated risk 
premium rate under section 1307(a)(1) for the area 
(or subdivision thereof) in which such structure is 
located, the minimum annual deductible for damage 
to or loss of such structure shall be $1,000.’’. 
(b) CLARIFICATION OF RESIDENTIAL AND COMMER-
CIAL COVERAGE LIMITS.—Section 1306(b) of the Na-
tional Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) 
is amended— 
(1) in paragraph (2)— 
(A) by striking ‘‘in the case of any residen-
tial property’’ and inserting ‘‘in the case of any 
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residential building designed for the occupancy 
of from one to four families’’; and 
(B) by striking ‘‘shall be made available to 
every insured upon renewal and every applicant 
for insurance so as to enable such insured or 
applicant to receive coverage up to a total 
amount (including such limits specified in para-
graph (1)(A)(i)) of $250,000’’ and inserting 
‘‘shall be made available, with respect to any 
single such building, up to an aggregate liability 
(including such limits specified in paragraph 
(1)(A)(i)) of $250,000’’; and 
(2) in paragraph (4)— 
(A) by striking ‘‘in the case of any nonresi-
dential property, including churches,’’ and in-
serting ‘‘in the case of any nonresidential build-
ing, including a church,’’; and 
(B) by striking ‘‘shall be made available to 
every insured upon renewal and every applicant 
for insurance, in respect to any single structure, 
up to a total amount (including such limit spec-
ified in subparagraph (B) or (C) of paragraph 
(1), as applicable) of $500,000 for each struc-
ture and $500,000 for any contents related to 
each structure’’ and inserting ‘‘shall be made 
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available with respect to any single such build-
ing, up to an aggregate liability (including such 
limits specified in subparagraph (B) or (C) of 
paragraph (1), as applicable) of $500,000, and 
coverage shall be made available up to a total 
of $500,000 aggregate liability for contents 
owned by the building owner and $500,000 ag-
gregate liability for each unit within the build-
ing for contents owned by the tenant’’. 
(c) INDEXING OF MAXIMUM COVERAGE LIMITS.— 
Subsection (b) of section 1306 of the National Flood In-
surance Act of 1968 (42 U.S.C. 4013(b)) is amended— 
(1) in paragraph (4), by striking ‘‘and’’ at the 
end; 
(2) in paragraph (5), by striking the period at 
the end and inserting ‘‘; and’’; 
(3) by redesignating paragraph (5) as para-
graph (7); and 
(4) by adding at the end the following new 
paragraph: 
‘‘(8) each of the dollar amount limitations 
under paragraphs (2), (3), (4), (5), and (6) shall be 
adjusted effective on the date of the enactment of 
the Flood Insurance Reform Act of 2012, such ad-
justments shall be calculated using the percentage 
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change, over the period beginning on September 30, 
1994, and ending on such date of enactment, in 
such inflationary index as the Administrator shall, 
by regulation, specify, and the dollar amount of such 
adjustment shall be rounded to the next lower dollar; 
and the Administrator shall cause to be published in 
the Federal Register the adjustments under this 
paragraph to such dollar amount limitations; except 
that in the case of coverage for a property that is 
made available, pursuant to this paragraph, in an 
amount that exceeds the limitation otherwise appli-
cable to such coverage as specified in paragraph (2), 
(3), (4), (5), or (6), the total of such coverage shall 
be made available only at chargeable rates that are 
not less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1).’’. 
(d) OPTIONAL COVERAGE FOR LOSS OF USE OF PER-
SONAL RESIDENCE AND BUSINESS INTERRUPTION.—Sub-
section (b) of section 1306 of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4013(b)), as amended by 
the preceding provisions of this section, is further amend-
ed by inserting after paragraph (4) the following new 
paragraphs: 
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‘‘(5) the Administrator may provide that, in the 
case of any residential property, each renewal or new 
contract for flood insurance coverage may provide 
not more than $5,000 aggregate liability per dwell-
ing unit for any necessary increases in living ex-
penses incurred by the insured when losses from a 
flood make the residence unfit to live in, except 
that— 
‘‘(A) purchase of such coverage shall be at 
the option of the insured; 
‘‘(B) any such coverage shall be made 
available only at chargeable rates that are not 
less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1); and 
‘‘(C) the Administrator may make such 
coverage available only if the Administrator 
makes a determination and causes notice of 
such determination to be published in the Fed-
eral Register that— 
‘‘(i) a competitive private insurance 
market for such coverage does not exist; 
and 
‘‘(ii) the national flood insurance pro-
gram has the capacity to make such cov-
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erage available without borrowing funds 
from the Secretary of the Treasury under 
section 1309 or otherwise; 
‘‘(6) the Administrator may provide that, in the 
case of any commercial property or other residential 
property, including multifamily rental property, cov-
erage for losses resulting from any partial or total 
interruption of the insured’s business caused by 
damage to, or loss of, such property from a flood 
may be made available to every insured upon re-
newal and every applicant, up to a total amount of 
$20,000 per property, except that— 
‘‘(A) purchase of such coverage shall be at 
the option of the insured; 
‘‘(B) any such coverage shall be made 
available only at chargeable rates that are not 
less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1); and 
‘‘(C) the Administrator may make such 
coverage available only if the Administrator 
makes a determination and causes notice of 
such determination to be published in the Fed-
eral Register that— 
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‘‘(i) a competitive private insurance 
market for such coverage does not exist; 
and 
‘‘(ii) the national flood insurance pro-
gram has the capacity to make such cov-
erage available without borrowing funds 
from the Secretary of the Treasury under 
section 1309 or otherwise;’’. 
(e) PAYMENT OF PREMIUMS IN INSTALLMENTS FOR 
RESIDENTIAL PROPERTIES.—Section 1306 of the Na-
tional Flood Insurance Act of 1968 (42 U.S.C. 4013) is 
amended by adding at the end the following new sub-
section: 
‘‘(d) PAYMENT OF PREMIUMS IN INSTALLMENTS FOR 
RESIDENTIAL PROPERTIES.— 
‘‘(1) AUTHORITY.—In addition to any other 
terms and conditions under subsection (a), such reg-
ulations shall provide that, in the case of any resi-
dential property, premiums for flood insurance cov-
erage made available under this title for such prop-
erty may be paid in installments. 
‘‘(2) LIMITATIONS.—In implementing the au-
thority under paragraph (1), the Administrator may 
establish increased chargeable premium rates and 
surcharges, and deny coverage and establish such 
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other sanctions, as the Administrator considers nec-
essary to ensure that insureds purchase, pay for, 
and maintain coverage for the full term of a contract 
for flood insurance coverage or to prevent insureds 
from purchasing coverage only for periods during a 
year when risk of flooding is comparatively higher or 
canceling coverage for periods when such risk is 
comparatively lower.’’. 
(f) EFFECTIVE DATE OF POLICIES COVERING PROP-
ERTIES AFFECTED
BY FLOODS
IN PROGRESS.—Para-
graph (1) of section 1306(c) of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4013(c)) is amended by add-
ing after the period at the end the following: ‘‘With respect 
to any flood that has commenced or is in progress before 
the expiration of such 30-day period, such flood insurance 
coverage for a property shall take effect upon the expira-
tion of such 30-day period and shall cover damage to such 
property occurring after the expiration of such period that 
results from such flood, but only if the property has not 
suffered damage or loss as a result of such flood before 
the expiration of such 30-day period.’’. 
SEC. 345. REFORMS OF PREMIUM RATES. 
(a) INCREASE IN ANNUAL LIMITATION ON PREMIUM 
INCREASES.—Section 1308(e) of the National Flood In-
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