Risk Rating 2.0 Transparency Act

Bill: 118-s-602
Sponsor: full_name: Sen. Kennedy, John [R-LA]
Introduced: 2023-03-01
Policy area: Finance and Financial Sector
Latest action: action_date: 2023-03-01
text: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Summaries:
action_date: 2023-03-01
action_desc: Introduced in Senate
text: <p><strong>Risk Rating 2.0 Transparency Act</strong></p> <p>This bill requires the Federal Emergency Management Agency (FEMA) to release specified information regarding the National Flood Insurance Program's new <i>Risk Rating 2.0</i>. <i>Risk Rating 2.0</i> went into effect on October 1, 2021, for new policies and on April 1, 2022, for existing policies. It bases premium rates on an individual property's specific flood risk instead of the flood risk of a general location and property type. </p> <p>Under the bill, FEMA must </p> <ul> <li>publish all data and methods used to calculate premium rates under <i>Risk Rating 2.0</i>, </li> <li>create an online database where policyholders can see premium rates for their property using specified calculations, and</li> <li>publish an assessment of the economic and social impacts of <i>Risk Rating 2.0</i>. </li> </ul>

tv_txt: II 118th CONGRESS 1st Session S. 602 IN THE SENATE OF THE UNITED STATES March 1, 2023 Mr. Kennedy (for himself and Mrs. Hyde-Smith ) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs A BILL To require the Administrator of the Federal Emergency Management Agency to take certain actions relating to the National Flood Insurance Program, and for other purposes.

1. Short title This Act may be cited as the Risk Rating 2.0 Transparency Act . 2. Transparency requirements (a) Definitions In this section— (1) the term Administrator means the Administrator of the Federal Emergency Management Agency; and (2) the term National Flood Insurance Program means the program established under the National Flood Insurance Act of 1968 ( 42 U.S.C. 4001 et seq. ). (b) Required actions Not later than 1 year after the date of enactment of this Act, the Administrator shall complete each of the following actions: (1) Make available to the public all data and methods used to prescribe chargeable premium rates for types and classes of properties for which insurance coverage is available under the National Flood Insurance Act of 1968 ( 42 U.S.C. 4001 et seq. ) (referred to in this subsection as chargeable premium rates ) under Risk Rating 2.0, or any substantially similar methodology. (2) Create an online database that is available to policyholders under the National Flood Insurance Program that provides each such policyholder with information regarding what the chargeable premium rate for the applicable property of the policyholder would be— (A) under Risk Rating 2.0, or any substantially similar methodology; and (B) assuming that the limitation under section 1308(e) of the National Flood Insurance Act of 1968 ( 42 U.S.C. 4015(e) ) were not in effect. (3) Complete and publish a comprehensive assessment of the economic and social impacts of implementing Risk Rating 2.0 (or any substantially similar methodology) during the 20-year period beginning in the year in which the assessment is made, which shall include an evaluation of the effect that such implementation will have, during that 20-year period, on— (A) the affordability and availability of flood insurance under the National Flood Insurance Program; (B) property values; and (C) non-Federal Government revenues. (4) Supplement (and revise, as appropriate) the Record of Decision for the final nationwide programmatic environmental impact statement evaluating the environmental impacts of proposed modifications to the National Flood Insurance Program (83 Fed. Reg. 24328) to include the impacts of implementing Risk Rating 2.0, or any substantially similar methodology. (5) Demonstrate that the data and methods used to prescribe chargeable premium rates under Risk Rating 2.0, or any substantially similar methodology, satisfy the requirements under section 515 of the Consolidated Appropriations Act, 2001 ( Public Law 106–554 ; 114 Stat. 2763A–153), including that, in implementing that methodology, the Administrator ensures and maximizes the quality, objectivity, utility, and integrity of information disseminated by the Administrator. (6) Conduct public notice and comment rulemaking under chapter 5 of title 5, United States Code, regarding Risk Rating 2.0, or any substantially similar methodology, which shall include the development of a fair, transparent, and streamlined process to manage— (A) disputes over chargeable premium rates; and (B) other factors with respect to the implementation of that methodology. (7) For each county in the United States, publish the distribution of chargeable premium rates showing the median, mean, lower and upper quartiles, maximum amount, and minimum amount of chargeable premium rates under each of the following: (A) The method used to prescribe chargeable premium rates, as of September 30, 2021. (B) The methodology projected to be used to prescribe chargeable premium rates, as of April 1, 2022, assuming that the limitations under section 1308(e) of the National Flood Insurance Act of 1968 ( 42 U.S.C. 4015(e) ) are applied. (C) The methodology described in subparagraph (B), assuming that the limitations described in that subparagraph are not applied. (D) The methodology described in subparagraph (B), assuming that— (i) the limitations described in that subparagraph are applied; and (ii) the administrative costs of the National Flood Insurance Program are allocated on a uniform, per contract basis rather than as allocated under Risk Rating 2.0, or any substantially similar methodology. (E) The methodology described in subparagraph (B), assuming that— (i) the limitations described in that subparagraph are not applied; and (ii) the administrative costs of the National Flood Insurance Program are allocated on a uniform, per contract basis rather than as allocated under Risk Rating 2.0, or any substantially similar methodology. (8) Submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives a report detailing the satisfaction of the requirements under paragraphs (1) through (7).