Title: State Flood Mitigation Revolving Fund Act of 2018
Policy area: Finance and Financial Sector

Summary:
State Flood Mitigation Revolving Fund Act of 2018
This bill amends the National Flood Insurance Act of 1968 to permit the Federal Emergency Management Agency (FEMA) to provide capitalization grants to states to establish revolving funds to address flood risks. Revolving funds may be used to provide: (1) financial assistance to participants in the National Flood Insurance Program, including homeowners, businesses, nonprofit organizations, and local governments; or (2) support for leveraged loans or state bonds. Financial assistance may be used for elevation projects, flood-proofing activities, relocation or removal of buildings, environmental restoration, acquiring property, obtaining protective easements, and other activities identified by FEMA.
States must annually submit to FEMA a plan that identifies the intended uses of the state loan fund.
States may provide additional subsidies to low-income homeowners and recipients of financial assistance in low-income areas.

[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 7037 Introduced in House (IH)]

<DOC>






115th CONGRESS
  2d Session
                                H. R. 7037

    To amend the National Flood Insurance Act of 1968 to allow the 
  Administrator of the Federal Emergency Management Agency to provide 
capitalization grants to States to establish revolving funds to provide 
   funding assistance to reduce flood risks, and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            October 5, 2018

Mr. Crist (for himself and Mr. Williams) introduced the following bill; 
       which was referred to the Committee on Financial Services

_______________________________________________________________________

                                 A BILL


 
    To amend the National Flood Insurance Act of 1968 to allow the 
  Administrator of the Federal Emergency Management Agency to provide 
capitalization grants to States to establish revolving funds to provide 
   funding assistance to reduce flood risks, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``State Flood Mitigation Revolving 
Fund Act of 2018''.

SEC. 2. STATE REVOLVING LOAN FUNDS FOR FLOOD MITIGATION.

    Chapter I of the National Flood Insurance Act of 1968 (42 U.S.C. 
4011 et seq.) is amended by adding at the end the following:

``SEC. 1326. STATE REVOLVING LOAN FUNDS FOR FLOOD MITIGATION.

    ``(a) Definitions.--In this section--
            ``(1) the term `Community Rating System' means the 
        community rating system carried out under section 1315(b);
            ``(2) the term `eligible State' means a State, the District 
        of Columbia, and the Commonwealth of Puerto Rico;
            ``(3) the term `insular area' means--
                    ``(A) Guam;
                    ``(B) American Samoa;
                    ``(C) the Commonwealth of the Northern Mariana 
                Islands;
                    ``(D) the Federated States of Micronesia;
                    ``(E) the Republic of the Marshall Islands;
                    ``(F) the Republic of Palau; and
                    ``(G) the United States Virgin Islands;
            ``(4) the term `intended use plan' means a plan prepared 
        under subsection (d)(1);
            ``(5) the term `low-income geographic area' means an area 
        described in paragraph (1) or (2) of section 301(a) of the 
        Public Works and Economic Development Act of 1965 (42 U.S.C. 
        3161(a));
            ``(6) the term `low-income homeowner' means the owner of a 
        primary residence, the household income of which in a taxable 
        year is not more than 80 percent of the median income for the 
        area in which the residence is located;
            ``(7) the term `participating State' means an eligible 
        State that--
                    ``(A) has entered into an agreement under 
                subsection (b)(1); and
                    ``(B) agrees to comply with the requirements of 
                this section;
            ``(8) the term `pre-FIRM building' means a building for 
        which construction or substantial improvement occurred before 
        the effective date of the initial Flood Insurance Rate Map 
        published by the Administrator under section 1360 for the area 
        in which the building is located;
            ``(9) the term `repetitive loss structure' has the meaning 
        given the term in section 1370(a);
            ``(10) the term `severe repetitive loss property' has the 
        meaning given the term in section 1307(h);
            ``(11) the term `State loan fund' means a flood mitigation 
        assistance revolving loan fund established by an eligible State 
        under this section; and
            ``(12) the term `tribal government' means the recognized 
        government of an Indian tribe, or the governing body of an 
        Alaska Native regional or village corporation, that has been 
        determined eligible to receive services from the Bureau of 
        Indian Affairs.
    ``(b) General Authority.--
            ``(1) In general.--The Administrator may enter into an 
        agreement with an eligible State to provide a capitalization 
        grant for the eligible State to establish a revolving fund that 
        will provide funding assistance to help homeowners, businesses, 
        nonprofit organizations, and communities reduce flood risk in 
        order to decrease--
                    ``(A) the loss of life and property;
                    ``(B) the cost of flood insurance; and
                    ``(C) Federal disaster payments.
            ``(2) Timing of deposit and agreements for distribution of 
        funds.--
                    ``(A) In general.--Not later than the last day of 
                the fiscal year following the fiscal year in which a 
                capitalization grant is made to a participating State 
                under paragraph (1), the participating State shall--
                            ``(i) deposit the grant in the State loan 
                        fund of the State; and
                            ``(ii) enter into one or more binding 
                        agreements that provide for the State to 
                        distribute the grant funds for purposes 
                        authorized under subsection (c) such that--
                                    ``(I) in the case of the initial 
                                grant made under this section to a 
                                State, not less than 75 percent of the 
                                amount of the grant funds shall be 
                                distributed before the expiration of 
                                the 24-month period beginning upon 
                                deposit of such funds in the State loan 
                                fund of the State; and
                                    ``(II) in the case of any 
                                subsequent grant made under this 
                                section to a State, not less than 90 
                                percent of the amount of the grant 
                                funds made under the capitalization 
                                grant shall be distributed before the 
                                expiration of the 12-month period 
                                beginning upon deposit of such funds in 
                                the State loan fund of the State.
                    ``(B) Noncompliance.--Except as provided in 
                subparagraph (C), if a participating State does not 
                comply with subparagraph (A) with respect to a grant, 
                the Administrator shall reallocate the grant in 
                accordance with paragraph (3)(B).
                    ``(C) Exception.--The Administrator may not 
                reallocate any funds under subparagraph (B) to a 
                participating State that violated subparagraph (A) with 
                respect to a grant made during the same fiscal year in 
                which the funds to be reallocated were originally made 
                available.
            ``(3) Allocation.--
                    ``(A) In general.--The Administrator shall allocate 
                amounts made available to carry out this section to 
                participating States--
                            ``(i) for the participating States to 
                        deposit in the State loan funds established by 
                        the participating States; and
                            ``(ii) except as provided in paragraph (6), 
                        in accordance with the requirements described 
                        in subparagraph (B).
                    ``(B) Requirements.--The requirements described in 
                this subparagraph are as follows:
                            ``(i) Fifty percent of the total amount 
                        made available under subparagraph (A) shall be 
                        allocated so that each participating State 
                        receives the percentage amount that is obtained 
                        by dividing the number of properties that were 
                        insured under the national flood insurance 
                        program in that State in the fiscal year 
                        preceding the fiscal year in which the amount 
                        is allocated by the total number of properties 
                        that were insured under the national flood 
                        insurance program in the fiscal year preceding 
                        the fiscal year in which the amount is 
                        allocated.
                            ``(ii) Fifty percent of the total amount 
                        made available under subparagraph (A) shall be 
                        allocated so that each participating State 
                        receives a percentage of funds that is equal to 
                        the product obtained under clause (iii)(IV) 
                        with respect to that participating State after 
                        following the procedures described in clause 
                        (iii).
                            ``(iii) The procedures described in this 
                        clause are as follows:
                                    ``(I) Divide the total amount 
                                collected in premiums for properties 
                                insured under the national flood 
                                insurance program in each participating 
                                State during the previous fiscal year 
                                by the number of properties insured 
                                under the national flood insurance 
                                program in that State for that fiscal 
                                year.
                                    ``(II) Add together each quotient 
                                obtained under subclause (I).
                                    ``(III) For each participating 
                                State, divide the quotient obtained 
                                under subclause (I) with respect to 
                                that State by the sum obtained under 
                                subclause (II).
                                    ``(IV) For each participating 
                                State, multiply the amount that is 50 
                                percent of the total amount made 
                                available under subparagraph (A) by the 
                                quotient obtained under subclause 
                                (III).
            ``(4) No revolving fund required.--
                    ``(A) In general.--Notwithstanding any other 
                provision of this section, and subject to subparagraph 
                (B), a participating State that receives less than 
                $4,000,000 under paragraph (3)(B) in a fiscal year may 
                distribute the funds directly in the form of grants or 
                technical assistance for a purpose described in 
                subsection (c)(2), without regard to whether the State 
                has established a State loan fund.
                    ``(B) State matching.--A participating State that 
                exercises the authority under subparagraph (A) in a 
                fiscal year shall provide matching funds from non-
                Federal sources in an amount that is equal to 15 
                percent of the amount that the State receives under 
                paragraph (3)(B) in that fiscal year for purposes 
                described in subparagraph (A).
            ``(5) Allocation of remaining funds.--After allocating 
        amounts made available to carry out this section for a fiscal 
        year in accordance with paragraph (3), the Administrator shall 
        allocate any remaining amounts made available for that fiscal 
        year to participating States, using the procedures described in 
        clauses (i) through (iii) of paragraph (3)(B).
            ``(6) Allocation for tribal governments and insular 
        areas.--The Administrator shall reserve not less than 5.0 
        percent of the amount made available to carry out this section 
        in a fiscal year to enter into grant agreements with tribal 
        governments and insular areas, with the grant funds to be 
        distributed--
                    ``(A) according to criteria established by the 
                Administrator; and
                    ``(B) for a purpose described in subsection (c)(2).
            ``(7) Administrative costs; technical assistance.--The 
        Administrator shall reserve not more than 2.5 percent of the 
        amount made available to carry out this section in a fiscal 
        year--
                    ``(A) for administrative costs incurred in carrying 
                out this section; and
                    ``(B) to provide technical assistance to recipients 
                of grants under this section.
    ``(c) Use of Funds.--
            ``(1) In general.--Amounts deposited in a State loan fund, 
        including repayments of loans made from the fund and interest 
        earned on the amounts in the fund, shall be used--
                    ``(A) consistent with paragraphs (2) and (3) and 
                subsection (g), to provide financial assistance for--
                            ``(i) homeowners, businesses, and nonprofit 
                        organizations that are eligible to participate 
                        in the national flood insurance program; and
                            ``(ii) any local government that 
                        participates in the national flood insurance 
                        program;
                    ``(B) as a source of revenue and security for 
                leveraged loans, the proceeds of which shall be 
                deposited in the State loan fund; or
                    ``(C) for the sale of bonds as security for payment 
                of the principal and interest on revenue or general 
                obligation bonds issued by the participating State to 
                provide matching funds under subsection (g), if the 
                proceeds from the sale of the bonds are deposited in 
                the State loan fund.
            ``(2) Purposes.--A recipient of financial assistance 
        provided through amounts from a State loan fund--
                    ``(A) shall use the amounts to reduce--
                            ``(i) flood risk; or
                            ``(ii) potential flood claims submitted 
                        under the national flood insurance program;
                    ``(B) shall use the amounts in a cost-effective 
                manner under requirements established by the State, 
                which may require an applicant for financial assistance 
                to submit any information that the State considers 
                relevant or necessary before the date on which the 
                applicant receives the assistance;
                    ``(C) shall use the amounts for projects that--
                            ``(i) meet design and construction 
                        standards established by the Administrator;
                            ``(ii) are located in communities that--
                                    ``(I) participate in the national 
                                flood insurance program; and
                                    ``(II) have developed a State, 
                                local, or tribal government hazard 
                                mitigation plan that has been approved 
                                by the Administrator under section 
                                1366;
                            ``(iii)(I) address a repetitive loss 
                        structure or a severe repetitive loss property; 
                        or
                            ``(II) address flood risk in the 500-year 
                        floodplain, areas of residual flood risk, or 
                        other areas of potential flood risk, as 
                        identified by the Administrator; and
                            ``(iv) address current risk and anticipate 
                        future risk, such as sea-level rise;
                    ``(D) may use the amounts--
                            ``(i) for projects relating to--
                                    ``(I) structural elevation;
                                    ``(II) floodproofing;
                                    ``(III) the relocation or removal 
                                of buildings from the 100-year 
                                floodplain or other areas of flood 
                                risk, including the acquisition of 
                                properties for such a purpose;
                                    ``(IV) environmental restoration 
                                activities that directly reduce flood 
                                risk;
                                    ``(V) any eligible activity 
                                described in subparagraphs (A) through 
                                (G) of section 1366(c)(3); or
                                    ``(VI) other activities determined 
                                appropriate by the Administrator;
                            ``(ii) with respect to a project described 
                        in clause (i), only for expenditures directly 
                        related to a project described in that clause, 
                        including expenditures for planning, design, 
                        and associated pre-construction activities; and
                            ``(iii) to acquire, for the purposes of 
                        permanent protection, land, buildings, or a 
                        conservation easement from a willing seller or 
                        grantor;
                    ``(E) may not use the amounts--
                            ``(i) to construct buildings or expand 
                        existing buildings unless the activity is for 
                        the purpose of flood mitigation;
                            ``(ii) to improve any structure, unless the 
                        recipient has obtained flood insurance coverage 
                        in an amount at least equal to the lesser of 
                        the eligible project costs or the maximum 
                        insurable limit for the structure under the 
                        national flood insurance program coverage for 
                        the structure, which coverage shall be 
                        maintained for the useful life of the 
                        structure;
                            ``(iii) to improve a residential property 
                        with an appraised value that is not less than 
                        125 percent of the limitation on the maximum 
                        original principal obligation of a conventional 
                        mortgage that may be purchased by the Federal 
                        National Mortgage Association or the Federal 
                        Home Loan Mortgage Corporation in the area in 
                        which the property is located, as established 
                        under section 302(b)(2) of the Federal National 
                        Mortgage Association Charter Act (12 U.S.C. 
                        1717(b)(2)) and section 305(a)(2) of the 
                        Federal Home Loan Mortgage Corporation Act (12 
                        U.S.C. 1454(a)(2));
                            ``(iv) for the direct benefit of a 
                        homeowner if the annual household adjusted 
                        gross income of the homeowner during the 
                        previous fiscal year was not less than 
                        $200,000, as annually adjusted by the 
                        Administrator to reflect changes in the 
                        Consumer Price Index for All Urban Consumers, 
                        as published by the Bureau of Labor Statistics 
                        of the Department of Labor and rounded to the 
                        nearest $25; or
                            ``(v) to acquire real property or an 
                        interest in real property unless the property 
                        is purchased from a willing seller; and
                    ``(F) shall, in the use of such amounts, give 
                priority to the maximum extent practicable to projects 
                that assist low-income homeowners and low-income 
                geographical areas.
    ``(d) Intended Use Plans.--
            ``(1) In general.--After providing the opportunity for 
        public review and comment, each participating State shall 
        annually prepare a plan that identifies, for the year following 
        the date of issuance of the intended use plan, the intended 
        uses of the amounts available in the State loan fund of the 
        participating State.
            ``(2) Consultation during preparation.--Each participating 
        State, in preparing an intended use plan, shall ensure that the 
        State agency with primary responsibility for floodplain 
        management--
                    ``(A) provides oversight with respect to the 
                preparation of the intended use plan; and
                    ``(B) consults with any other appropriate State 
                agency, including agencies responsible for coastal and 
                environmental management.
            ``(3) Contents.--A participating State shall, in each 
        intended use plan--
                    ``(A) include--
                            ``(i) an explanation of the mitigation and 
                        resiliency benefits the State intends to 
                        achieve, including by--
                                    ``(I) reducing future damage and 
                                loss associated with flooding;
                                    ``(II) reducing the number of 
                                severe repetitive loss properties and 
                                repetitive loss structures in the 
                                State;
                                    ``(III) decreasing the number of 
                                flood insurance claims in the State; 
                                and
                                    ``(IV) increasing the rating under 
                                the Community Rating System for 
                                communities in the State;
                            ``(ii) information with respect to the 
                        availability of, and the application process 
                        for receiving, financial assistance from the 
                        State loan fund of the State;
                            ``(iii) the criteria and methods 
                        established for the distribution of amounts 
                        from the State loan fund of the State;
                            ``(iv) the amount of financial assistance 
                        that the State anticipates allocating to--
                                    ``(I) local government projects; 
                                and
                                    ``(II) projects for homeowners, 
                                business, or nonprofit organizations;
                            ``(v) the expected terms of the assistance 
                        provided under clause (iv); and
                            ``(vi) a description of the financial 
                        status of the State loan fund and the short-
                        term and long-term goals of the State loan 
                        fund; and
                    ``(B) provide, to the maximum extent practicable, 
                that priority for the use of amounts from the State 
                loan fund shall be given to projects that--
                            ``(i) address severe repetitive loss 
                        properties and repetitive loss structures;
                            ``(ii) assist low-income homeowners and 
                        low-income geographic areas; and
                            ``(iii) address flood risk for pre-FIRM 
                        buildings.
            ``(4) Publication.--Each participating State shall publish 
        and periodically update a list of all projects receiving 
        funding from the State loan fund of the State, which shall 
        include identification of--
                    ``(A) the community in which the project is 
                located;
                    ``(B) the type and amount of assistance provided 
                for each project; and
                    ``(C) the expected funding schedule and date of 
                completion of each project.
    ``(e) Fund Management.--Amounts in a State loan fund shall--
            ``(1) remain available for providing financial assistance 
        under this section until distributed;
            ``(2) if the amounts are not required for immediate 
        distribution or expenditure, be invested in interest-bearing 
        obligations; and
            ``(3) except as provided in subsection (i), include only--
                    ``(A) amounts received from capitalization grants 
                made under this section;
                    ``(B) repayments of loans made from the fund; and
                    ``(C) interest earned on amounts in the fund.
    ``(f) Matching Funds.--
            ``(1) Full grant.--On or before the date on which a 
        participating State receives a capitalization grant, the State 
        shall deposit into the State loan fund of the State, in 
        addition to the amount of the capitalization grant, an amount 
        from non-Federal sources that is not less than 10 percent of 
        the total amount of the capitalization grant.
            ``(2) Reduced grant.--Notwithstanding paragraph (1), if a 
        State deposits in the State loan fund of the State in 
        connection a capitalization grant an amount from non-Federal 
        sources that is less than 10 percent of the total amount of the 
        capitalization grant that would otherwise be received by the 
        State, the Administrator shall reduce the amount of the 
        capitalization grant received by the State to the amount that 
        is 10 times the amount so deposited and shall allocate such 
        remaining grant amounts under subsection (b)(5) together with 
        the amounts allocated under such subsection.
    ``(g) Types of Assistance.--Unless otherwise prohibited by State 
law, a participating State may use the amounts deposited into a State 
loan fund under this section only--
            ``(1) to make a loan, on the condition that--
                    ``(A) the interest rate for the loan is not more 
                than the market interest rate;
                    ``(B) the recipient of the loan will begin making 
                principal and interest payments on the loan not later 
                than 1 year after the date on which the project for 
                which the loan was made is completed;
                    ``(C) the loan will be fully amortized not later 
                than 20 years after the date on which the project for 
                which the loan was made is completed, except that, in 
                the case of a loan made for a project in a low-income 
                geographic area or to a low-income homeowner, the State 
                may provide a longer amortization period for the loan 
                if that longer period--
                            ``(i) ends on a date that is not later than 
                        30 years after the date on which the project is 
                        completed; and
                            ``(ii) is not longer than the expected 
                        design life of the project;
                    ``(D) the recipient of the loan demonstrates, based 
                on verified and documented information that, at the 
                time the loan is consummated, that the recipient has a 
                reasonable ability to repay the loan, according to its 
                terms, except that this subparagraph may not be 
                construed to authorize any reduction or limitation in 
                efforts to comply with the requirements of subsection 
                (c)(2)(E) (relating to priority for assistance for low-
                income homeowners and low-income geographical areas); 
                and
                    ``(E) payments of principal and interest with 
                respect to the loan will be deposited into the State 
                loan fund;
            ``(2) to buy or refinance the debt obligation of a local 
        government at an interest rate that is not more than the market 
        interest rate;
            ``(3) to guarantee, or purchase insurance for, a local 
        obligation, the proceeds of which finance a project eligible 
        for assistance under this section, if the guarantee or 
        purchase, as applicable, would--
                    ``(A) improve credit market access; or
                    ``(B) reduce the interest rate with respect to the 
                obligation;
            ``(4) as a source of revenue or as security for the payment 
        of principal and interest on revenue or general obligation 
        bonds issued by the State if the proceeds of the sale of the 
        bonds will be deposited into the State loan fund; or
            ``(5) to earn interest on those amounts.
    ``(h) Assistance for Low-Income Homeowners and Low-Income 
Geographic Areas.--
            ``(1) In general.--Notwithstanding any other provision of 
        this section, if a participating State uses amounts from a 
        State loan fund to provide financial assistance under 
        subsection (c) in a low-income geographic area or to a low-
        income homeowner, the State may provide additional 
        subsidization to the recipient of the assistance, including 
        forgiveness of the principal of a loan.
            ``(2) Limitation.--For each fiscal year, the total amount 
        of additional subsidization provided by a participating State 
        under paragraph (1) may not exceed 30 percent of the amount of 
        the capitalization grant allocated to the State for that fiscal 
        year.
    ``(i) Administration of Fund.--
            ``(1) In general.--A participating State may combine the 
        financial administration of a State loan fund with the 
        financial administration of any other revolving fund 
        established by the State if--
                    ``(A) combining the administration of the funds 
                would--
                            ``(i) be convenient and avoid 
                        administrative costs; and
                            ``(ii) not violate the law of the State; 
                        and
                    ``(B) the Administrator determines that--
                            ``(i) amounts obtained from a grant made 
                        under this section, amounts obtained from the 
                        repayment of a loan made from a State loan 
                        fund, and interest earned on amounts in a State 
                        loan fund will be--
                                    ``(I) accounted for separately from 
                                amounts from other revolving funds; and
                                    ``(II) used only for purposes 
                                authorized under this section; and
                            ``(ii) after consulting with the 
                        appropriate State agencies, the authority to 
                        establish assistance priorities and carry out 
                        oversight and related activities, other than 
                        financial administration, with respect to flood 
                        assistance remains with the State agency with 
                        primary responsibility for floodplain 
                        management.
            ``(2) Administrative and technical costs.--
                    ``(A) In general.--For each fiscal year, a 
                participating State may use the amount described in 
                subparagraph (B) to--
                            ``(i) pay the reasonable costs of 
                        administration of the programs under this 
                        section, including the recovery of reasonable 
                        costs incurred in establishing a State loan 
                        fund;
                            ``(ii) provide appropriate oversight of 
                        projects authorized under this section; and
                            ``(iii) provide technical assistance and 
                        outreach to recipients in the State of amounts 
                        under this section, including with respect to 
                        updating hazard mitigation plans and 
                        participating in the Community Rating System, 
                        in an amount that is not more than 4 percent of 
                        the funds made available to the State under 
                        this section.
                    ``(B) Description.--The amount described in this 
                subparagraph is an amount equal to the sum of--
                            ``(i) any fees collected by a participating 
                        State to recover the costs described in 
                        subparagraph (A)(i), regardless of the source; 
                        and
                            ``(ii) the greatest of--
                                    ``(I) $400,000;
                                    ``(II) 0.2 percent of the value of 
                                the State loan fund of a State, as of 
                                the date on which the valuation is 
                                made; and
                                    ``(III) an amount equal to 7 
                                percent of all grant awards made to a 
                                participating State for the State loan 
                                fund of the State under this section 
                                for the fiscal year.
            ``(3) Audit and report.--
                    ``(A) Audit requirement.--Not less frequently than 
                biennially, each participating State shall conduct an 
                audit of the State loan fund of the State.
                    ``(B) Report.--Each participating State shall 
                submit to the Administrator a biennial report regarding 
                the activities of the State under this section during 
                the period covered by the report, including--
                            ``(i) the result of any audit conducted by 
                        the State under subparagraph (A); and
                            ``(ii) a review of the effectiveness of the 
                        State loan fund of the State with respect to--
                                    ``(I) the intended use plans of the 
                                State; and
                                    ``(II) meeting the objectives 
                                described in subsection (b)(1).
            ``(4) Oversight.--In conducting oversight with respect to 
        State loan funds established under this section, the 
        Administrator--
                    ``(A) shall--
                            ``(i) periodically audit the funds in 
                        accordance with procedures established by the 
                        Comptroller General of the United States; and
                            ``(ii) not less frequently than once every 
                        4 years, review each State loan fund to 
                        determine the effectiveness of the fund in 
                        reducing flood risk; and
                    ``(B) may, at any time--
                            ``(i) make recommendations to a 
                        participating State with respect to the 
                        administration of the State loan fund of the 
                        State; or
                            ``(ii) require specific changes with 
                        respect to a State loan fund in order to 
                        improve the effectiveness of the fund.
    ``(j) Liability Protections.--The Federal Government shall not be 
liable for any claim based upon the exercise or performance of, or the 
failure to exercise or perform, a discretionary function or duty on the 
part of the Federal agency, or an employee of the Federal Government, 
in carrying out the provision of this section.
    ``(k) Regulations.--The Administrator shall promulgate such 
guidance or regulations as may be necessary to carry out this section, 
including guidance or regulations that--
            ``(1) ensure that each participating State to which funds 
        are allocated under this section uses the funds as efficiently 
        as possible;
            ``(2) reduce, to the maximum extent practicable, waste, 
        fraud, and abuse with respect to the implementation of this 
        section; and
            ``(3) require any party that receives funds directly or 
        indirectly under this section, including a participating State 
        and a recipient of amounts from a State loan fund, to use 
        procedures with respect to the management of the funds that 
        conform to generally accepted accounting standards.
    ``(l) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this section 
for fiscal years 2019 through 2028.''.

SEC. 3. CONSIDERATION OF MITIGATION MEASURES FUNDED BY STATE LOAN FUNDS 
              IN FLOOD INSURANCE PREMIUM RATES.

    (a) Estimated Rates.--Clause (ii) of section 1307(a)(1)(A) of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4014(a)(1)(A)(ii)) is 
amended by inserting ``and any activities assisted through amounts from 
a State loan fund established pursuant to section 1326,'' after 
``similar measures,''.
    (b) Chargeable Rates.--Paragraph (1) of section 1308(b) of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4015(b)(1)) is amended 
by striking ``and similar measures'' and inserting ``similar measures, 
and any activities assisted through amounts from a State loan fund 
established pursuant to section 1326''.
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