< Back to H.R. 4052 (103rd Congress, 1993–1994)

Text of the National Flood Insurance Program Improvement Act of 1994

This bill was introduced on March 16, 1994, in a previous session of Congress, but was not enacted. The text of the bill below is as of Mar 16, 1994 (Introduced).

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HR 4052 IH

103d CONGRESS

2d Session

H. R. 4052

To improve the National Flood Insurance Program.

IN THE HOUSE OF REPRESENTATIVES

March 16, 1994

Mr. BACCHUS of Florida (for himself, Mr. BAKER of Louisiana, Mr. MCCOLLUM, Mr. LAZIO, Mr. FAZIO, Mr. JOHNSTON of Florida, Mr. SHAW, Mrs. MEEK, Mr. JEFFERSON, Mr. RAVENEL, Mrs. FOWLER, Mr. SCHUMER, Mr. FLAKE, Mr. JOHNSON of South Dakota, Mr. LEWIS of Florida, Mr. MILLER of Florida, Mr. KLINK, Ms. BROWN of Florida, Mr. BILIRAKIS, Mr. MICA, Mr. LIVINGSTON, Mr. KING, Mr. STEARNS, Mr. ACKERMAN, Mr. CANADY, Mr. PETERSON of Florida, Mr. LEVY, Mr. COLEMAN, Mr. GALLEGLY, Mr. BOEHNER, Mr. HASTINGS, Mr. HUTTO, Mr. PETERSON of Minnesota, Mr. MANZULLO, Mr. DEUTSCH, Mrs. THURMAN, Mr. CALVERT, Mr. GOODLING, Mr. MACHTLEY, Mr. FIELDS of Louisiana, Mr. GOSS, Mr. YOUNG of Alaska, Mr. CRAPO, Mr. DIAZ-BALART, Ms. ROS-LEHTINEN, Mr. FRANKS of New Jersey, Mr. DOOLEY, Mr. CRAMER, Mr. HAYES, Mr. QUINN, Mr. MCCRERY, Mr. SPENCE, Mr. YOUNG of Florida, Ms. MOLINARI, Mr. TAUZIN, Mr. BATEMAN, Mr. POMBO, and Mr. TALENT) introduced the following bill; which was referred to the Committee on Banking, Finance and Urban Affairs


A BILL

To improve the National Flood Insurance Program.

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

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

    (a) SHORT TITLE- This Act may be cited as the ‘National Flood Insurance Program Improvement Act of 1994’.

    (b) TABLE OF CONTENTS- The table of contents for this Act is as follows:

      Sec. 1. Short title and table of contents.

      Sec. 2. Definition.

TITLE I--DEFINITIONS

      Sec. 101. Flood Disaster Protection Act of 1973.

      Sec. 102. National Flood Insurance Act of 1968.

TITLE II--COMPLIANCE AND INCREASED PARTICIPATION

      Sec. 201. Expanded flood insurance purchase requirements.

      Sec. 202. Escrow of flood insurance payments.

      Sec. 203. Notice requirements.

      Sec. 204. Placement of flood insurance by regulated lending institution, Federal agency lender, or servicer.

      Sec. 205. Standard flood hazard determination forms.

      Sec. 206. Examinations regarding compliance by regulated lending institutions.

      Sec. 207. Penalties and corrective actions for failure to require flood insurance, escrow, or notify.

      Sec. 208. Federal Financial Institutions Examination Council.

      Sec. 209. Conforming amendment.

TITLE III--RATINGS AND INCENTIVES FOR COMMUNITY FLOODPLAIN MANAGEMENT PROGRAMS

      Sec. 301. Community rating system and incentives for community floodplain management.

      Sec. 302. Community erosion hazard management program.

      Sec. 303. Funding.

TITLE IV--MITIGATION OF FLOOD AND EROSION RISKS

      Sec. 401. Mitigation assistance in Federal insurance administration.

      Sec. 402. Authorization of national flood and erosion mitigation funds under section 1367.

      Sec. 403. State and community mitigation assistance program.

      Sec. 404. Repeal of program for purchase of certain insured properties.

      Sec. 405. Termination of erosion threatened structures program.

TITLE V--TASK FORCE, ADVISORY COUNCIL, AND STUDIES

      Sec. 501. Flood Insurance Interagency Task Force.

      Sec. 502. Technical Mapping Advisory Council.

      Sec. 503. Economic impact study of erosion hazard areas.

      Sec. 504. Justification for Government operation of the National Flood Insurance Program and determination of the feasibility and availability of private sector flood insurance coverage.

TITLE VI--MISCELLANEOUS PROVISIONS

      Sec. 601. Maximum flood insurance coverage amounts.

      Sec. 602. Additional coverage for compliance with land use and control measures.

      Sec. 603. Flood insurance program arrangements with private insurance entities.

      Sec. 604. Updating of flood insurance maps and identification of erosion hazard areas.

      Sec. 605. Agricultural structures.

      Sec. 606. Funding for increased administrative and operational responsibilities.

      Sec. 607. Separate account for flood insurance fund.

      Sec. 608. Nonwaiver of flood purchase requirement for recipients of Federal disaster assistance.

      Sec. 609. Insurance waiting period.

      Sec. 610. Implementation review by the Director.

      Sec. 611. Regulations.

SEC. 2. DEFINITION.

    As used in this Act, the term ‘Director’ means the Director of the Federal Emergency Management Agency.

TITLE I--DEFINITIONS

SEC. 101. FLOOD DISASTER PROTECTION ACT OF 1973.

    (a) IN GENERAL- Section 3(a) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4003(a)) is amended--

      (1) by striking paragraph (5) and inserting the following new paragraph:

      ‘(5) ‘Federal entity for lending regulation’ means the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Comptroller of the Currency, the Office of Thrift Supervision, the National Credit Union Administration Board, and the Farm Credit Administration, and with respect to a particular regulated lending institution means the entity primarily responsible for the supervision of the institution;’;

      (2) in paragraph (6), by striking the period at the end and inserting a semicolon; and

      (3) by inserting after paragraph (6) the following new paragraphs:

      ‘(7) ‘regulated lending institution’ means a bank, savings association, credit union, farm credit bank, Federal land bank association, or production credit association subject to the supervision of a Federal entity for lending regulation;

      ‘(8) ‘Federal agency lender’ means the Federal Housing Administration, the Farmers Home Administration, the Small Business Administration, and the Veterans’ Administration, when such agency makes loans secured by improved real estate or a manufactured home; and

      ‘(9) ‘servicer’ means a person who receives any scheduled periodic payments from a borrower pursuant to the terms of any loan secured by a lien on real property, and who makes the payments of principal and interest and such other payments with respect to the amounts received from the borrower as may be required.’.

    (b) CONFORMING AMENDMENTS-

      (1) REQUIREMENTS TO PURCHASE FLOOD INSURANCE- Section 102(b) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(b)) is amended by striking ‘Each Federal instrumentality responsible for the supervision, approval, regulation, or insuring of banks, savings and loan associations, or similar institutions shall by regulation direct such institutions’ and inserting ‘Each Federal entity for lending regulation shall by regulation direct regulated lending institutions’.

      (2) EFFECT OF NONPARTICIPATION IN FLOOD INSURANCE PROGRAM- Section 202(b) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4106(b)) is amended by striking ‘Federal instrumentality described in such section shall by regulation require the institutions’ and inserting ‘Federal entity for lending regulation (with respect to regulated lending institutions)’.

SEC. 102. NATIONAL FLOOD INSURANCE ACT OF 1968.

    (a) IN GENERAL- Section 1370(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 4121(a)) is amended--

      (1) in paragraph (5), by striking ‘and’ at the end;

      (2) in paragraph (6), by striking the period at the end and inserting a semicolon; and

      (3) by adding at the end the following new paragraphs:

      ‘(7) the term ‘Federal entity for lending regulation’ means the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Comptroller of the Currency, the Office of Thrift Supervision, the National Credit Union Administration Board, and the Farm Credit Administration, and with respect to a particular regulated lending institution, means the entity primarily responsible for the supervision of the institution;

      ‘(8) the term ‘regulated lending institution’ means a bank, savings association, credit union, farm credit bank, Federal land bank association, or production credit association subject to the supervision of a Federal entity for lending regulation;

      ‘(9) the term ‘Federal agency lender’ means the Federal Housing Administration, the Farmers Home Administration, the Small Business Administration, and the Veterans’ Administration, when such agency makes loans secured by improved real estate or a manufactured home;

      ‘(10) the term ‘erosion control measures’ means a community’s efforts to control erosion through nonstructural and structural projects;

      ‘(11) the term ‘repetitive loss structure’ means an insured property--

        ‘(A) that incurred flood-related damage on 2 occasions during a 10-year period ending on the date of the event for which a second claim is made, in which the cost of repair, on the average, equaled or exceeded 25 percent of the value of the structure at the time of each flood event;

        ‘(B) that was continuously covered by a contract for flood insurance under this title for not less than the period beginning upon the 1st occasion of flood-related damage referred to in subparagraph (A) and ending upon the 2nd occasion of such damage; and

        ‘(C) that would have a chargeable rate that is less than the applicable estimated risk premium for such area (or subdivision thereof) under section 1307(a)(1);

      ‘(12) the term ‘cost of compliance with land use and control measures’ means--

        ‘(A) the cost of elevating a structure so that the structure is in compliance with the minimum performance standards adopted by the community pursuant to section 1315 of the National Flood Insurance Act of 1968; or

        ‘(B) the cost of relocation or demolition of the structure, if--

          ‘(i) elevating a structure will not result in compliance; or

          ‘(ii) the insured consents; and

      ‘(13) the term ‘servicer’ means any person who receives any scheduled periodic payments from a borrower pursuant to the terms of any loan secured by a lien on real property, and who makes the payments of principal and interest and such other payments with respect to the amounts received from the borrower as may be required.’.

    (b) CONFORMING AMENDMENT- Section 1322(d) of the National Flood Insurance Act of 1968 (42 U.S.C. 4029(d)) is amended by striking ‘federally supervised, approved, regulated or insured financial institution’ and inserting ‘regulated lending institution’.

TITLE II--COMPLIANCE AND INCREASED PARTICIPATION

SEC. 201. EXPANDED FLOOD INSURANCE PURCHASE REQUIREMENTS.

    (a) FEDERAL AGENCIES- Section 102(a) of the Flood Disasters Protection Act of 1973 (42 U.S.C. 4012a(a)), is amended--

      (1) by inserting ‘(1)’ after ‘(a)’; and

      (2) by adding at the end the following new paragraphs:

    ‘(2) The Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Federal Agricultural Mortgage Corporation shall implement procedures reasonably designed to assure that all loans that are--

      ‘(A) secured by improved real estate or a manufactured home located in an area that has been identified at the time of the origination of the loan by the Director as an area having special flood hazards and in which flood insurance is available under the National Flood Insurance Act of 1968; and

      ‘(B) purchased by any such entity;

    are covered for the term of the loan by flood insurance in the amount provided in subsection (b).

    ‘(3) Each Federal agency lender shall implement procedures reasonably designed to assure that all property--

      ‘(A) that secures loans that the Federal agency lender makes, increases, extends, or renews; and

      ‘(B) that is improved by real estate or a manufactured home located in an area that has been identified at the time of the origination of the loan by the Director as an area having special flood hazards and in which flood insurance is available under the National Flood Insurance Act of 1968;

    is covered for the term of the loan by flood insurance in the amount provided in subsection (b).’.

    (b) REGULATED LENDING INSTITUTIONS- Section 102(b) of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(b)), as amended by section 101(b)(1), is amended by inserting before ‘shall by regulation’ the following: ‘(after consultation and coordination with the Federal Financial Institutions Examination Council established under the Federal Financial Institutions Examination Council Act of 1974)’.

    (c) EFFECTIVE DATE- The amendments made by this section shall apply to all transactions occurring after the expiration of the 1-year period beginning on the date of enactment of this Act.

SEC. 202. ESCROW OF FLOOD INSURANCE PAYMENTS.

    (a) 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:

    ‘(d)(1) Each Federal entity for lending regulation, after consultation and coordination with the Federal Financial Institutions Examination Council, shall by regulation require that, if a regulated lending institution requires the escrowing of taxes, insurance premiums, fees, or any other charges for a loan secured by residential real estate or manufactured homes, all charges for flood insurance under this title for the property shall be paid by the borrower to the institution for the duration of the period during which the regulated lending institution maintains an escrow account. Upon receipt of a notice from the Director or the provider of the insurance that insurance premiums, fees, or other charges are due, the institution shall pay from the escrow account to the provider of the insurance the amount of insurance premiums, fees or other charges owed.

    ‘(2) If a Federal agency lender requires the escrowing of taxes, insurance premiums, fees, or any other charges, then any charges for flood insurance under this title for the residential real estate or the manufactured home shall be paid by the borrower to the Federal agency lender for the duration of the period during which the Federal agency lender maintains an escrow account. Upon receipt of a notice from the Director or the provider of the insurance that insurance premiums, fees, or other charges are due, the Federal agency lender shall pay from the escrow account to the provider of the insurance the amount of insurance premiums, fees or other charges owed.

    ‘(3) Escrow accounts used to collect flood insurance premiums, fees, or other charges under this subsection shall be subject to the provisions of section 10 of the Real Estate Settlement Procedures Act of 1974.’.

    (b) APPLICABILITY- Section 102(d) of the Flood Disaster Protection Act of 1973, as added by subsection (a), shall apply with respect to any loan made, increased, extended, or renewed after the expiration of the 1-year period beginning on the date of enactment of this Act.

SEC. 203. NOTICE REQUIREMENTS.

    Section 1364 of the National Flood Insurance Act of 1968 (42 U.S.C. 4104a) is amended to read as follows:

‘SEC. 1364. NOTICE REQUIREMENTS.

    ‘(a) LENDING INSTITUTIONS- Each Federal entity for lending regulation, after consultation and coordination with the Federal Financial Institutions Examination Council, shall by regulation require that before a regulated lending institution makes, increases, extends, or renews a loan secured by improved real estate or a manufactured home located in an area that has been identified by the Director as an area having special flood hazards, the institution shall notify the borrower of the special flood hazards and of the need to purchase and maintain flood insurance.

    ‘(b) FEDERAL AGENCY LENDERS- Before a Federal agency lender makes, increases, extends, or renews a loan secured by improved real estate or a manufactured home located in an area that has been identified by the Director as an area having special flood hazards, the Federal agency lender shall notify the borrower of the special flood hazards and of the need to purchase and maintain flood insurance.

    ‘(c) PARTICIPATING COMMUNITIES- The Director shall by regulation require each participating community, upon receiving the semiannual list prepared by the Director of all changes, revisions, and amendments made to the flood insurance rate maps during the preceding 6 months, to determine whether any properties in their community have been affected, and to provide annual notice by mail, notice by publication, notice on tax assessments, or notice by other reasonable method, to regulated lending institutions that are known to lend in the community, and to the owners of all properties newly determined to be, or no longer to be, in an area having special flood hazards, of the flood insurance purchase requirements under section 102(b).

    ‘(d) CONTENTS OF NOTICE- Notification required by this section shall include a warning, in a form to be established by the Director, stating that the real estate or manufactured home securing the loan is located in an area having special flood hazards, a description of the flood insurance purchase requirements under section 102(b), a statement that flood insurance coverage may be purchased under the National Flood Insurance Program and may also be available from private insurers, and any other information that the Director considers necessary to carry out the purposes of the National Flood Insurance Program.’.

SEC. 204. PLACEMENT OF FLOOD INSURANCE BY REGULATED LENDING INSTITUTION, FEDERAL AGENCY LENDER, OR SERVICER.

    (a) REQUIRED ACTIONS BY LENDER- Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a), as amended by section 202(a), is amended by adding at the end the following new subsection:

    ‘(e) REQUIRED ACTIONS BY LENDER-

      ‘(1) NOTIFICATION TO BORROWER OF LACK OF COVERAGE- If, at the time of origination or at any other time during the term of a loan secured by improved real estate or by a manufactured home located in an area that has been identified by the Director as an area having special flood hazards and in which flood insurance is available under this title, a regulated lending institution, Federal agency lender, or servicer determines that the building or manufactured home and any personal property securing the loan held or serviced by the regulated lending institution, Federal agency lender, or servicer is not covered by flood insurance, in an amount not less than the amount required by subsection (b), the regulated lending institution, Federal agency lender, or servicer shall notify the borrower, in a form to be established by the Director, that the borrower should obtain, at the borrower’s expense, an amount of flood insurance that is not less than the amount required by subsection (b), for the term of the loan. If, not later than 45 days after receiving such notification, the borrower fails to purchase such flood insurance, the regulated lending institution, Federal agency lender, or servicer shall purchase the insurance on behalf of the borrower and may charge the borrower for the cost of premiums and fees incurred by the regulated lending institution, Federal agency lender, or servicer in purchasing the insurance.

      ‘(2) REVIEW-

        ‘(A) BY THE DIRECTOR- A borrower may request, based upon the submission of supporting technical data, that the Director review a determination that the improved real estate or manufactured home securing the loan is located in an area having special flood hazards. Not later than 45 days after the Director receives the request, the Director shall review the determination and provide the borrower with a letter stating whether or not the property is in an area having special flood hazards. The determination of the Director shall be final. If the Director fails to respond to a request within 45 days, the property shall be deemed not to be located in an area having special flood hazards.

        ‘(B) INSURANCE NOT REQUIRED- If a person is provided by the borrower with a letter issued by the Director pursuant to subparagraph (A) during the preceding 1-year period, stating that the property is not in an area having special flood hazards, such person shall have no obligation under this title to require the purchase of flood insurance on the property.’.

    (b) APPLICABILITY-

      (1) IN GENERAL- Except as provided in paragraph (2), section 102(e) of the Flood Disaster Protection Act of 1973, as added by subsection (a), shall apply to all loans outstanding on or after the date of enactment of this Act.

      (2) LOANS REGULATED BY THE FARM CREDIT ADMINISTRATION- Notwithstanding paragraph (1), with respect to loans held by institutions regulated by the Farm Credit Administration, section 102(e) of the Flood Disaster Protection Act of 1973, as added by subsection (a), shall apply only to loans originating on or after the date of enactment of this Act.

SEC. 205. STANDARD FLOOD HAZARD DETERMINATION FORMS.

    (a) IN GENERAL- Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.) is amended by adding at the end the following new section:

‘SEC. 1365. STANDARD FLOOD HAZARD DETERMINATION FORMS.

    ‘(a) DEVELOPMENT- The Director, in consultation with the Federal entities for lending regulation, and after notice and comment, shall develop a standard flood hazard determination form (hereafter in this section referred to as the ‘determination form’) for use in connection with loans secured by improved real estate or a manufactured home located in an area having special flood hazards and in which flood insurance is available under this title. The determination form may be maintained in a printed, computerized, or electronic manner.

    ‘(b) DESIGN AND CONTENTS- The determination form shall state whether the property is in an area having special flood hazards, the risk premium rate classification established for the special flood hazard area in which the property is located, the complete map and panel numbers for the property, and the date of the map used for the determination. If the complete map and panel numbers for the property are not available because the property is not located in a community that is participating in the National Flood Insurance Program or because no map exists for the relevant area, the determination form shall so state.

    ‘(c) REQUIRED USE- Each Federal entity for lending regulation shall by regulation require the use of the determination form by regulated lending institutions. Each Federal agency lender shall by regulation provide for the use of the determination form. The Federal National Mortgage Association, the Federal Home Loan Mortgage Corporation, and the Federal Agricultural Mortgage Corporation shall require use of the determination form by any person from whom they purchase loans.

    ‘(d) GUARANTEES REGARDING INFORMATION- In recording information on a determination form, a person may rely on information provided by a third party to the extent that the third party guarantees the accuracy of the information.

    ‘(e) RELIANCE ON PREVIOUS DETERMINATION- A person or institution increasing, extending, renewing, or purchasing a loan may rely on a previous determination as to whether property is in an area having special flood hazards, if the previous determination was made not more than 5 years before the date of the transaction, and the basis for the previous determination has been set forth on a determination form.’.

    (b) APPLICABILITY- Section 1365 of the National Flood Insurance Act of 1968, as added by subsection (a), shall apply to all loans originated on or after the expiration of the 6-month period beginning on the date the standard flood hazard determination form is finalized by the Director.

SEC. 206. EXAMINATIONS REGARDING COMPLIANCE BY REGULATED LENDING INSTITUTIONS.

    (a) AMENDMENT TO FEDERAL DEPOSIT INSURANCE ACT- Section 10 of the Federal Deposit Insurance Act (12 U.S.C. 1820) is amended by adding at the end the following new subsection:

    ‘(h) FLOOD HAZARD INSURANCE COMPLIANCE BY INSURED DEPOSITORY INSTITUTIONS REQUIRED-

      ‘(1) EXAMINATIONS- The appropriate Federal banking agency shall, during each scheduled on-site examination required by this section, determine whether the insured depository institution is complying with the requirements of the National Flood Insurance Program.

      ‘(2) REPORT- Not later than 1 year after the date of enactment of the National Flood Insurance Program Improvement Act of 1994, and biannually thereafter for the next 4 years, each appropriate Federal banking agency shall submit a report to the Congress on compliance by insured depository institutions with the requirements of the National Flood Insurance Program. The report shall include a description of the methods used to determine compliance, the number of institutions examined during the reporting year, a listing and total number of institutions found to be in noncompliance, actions taken to correct incidents of noncompliance, and an analysis of compliance, including a discussion of any trends, patterns, and problems, and recommendations regarding reasonable actions to improve the efficiency of the examinations processes.’.

    (b) AMENDMENT TO THE FEDERAL CREDIT UNION ACT- Section 204 of the Federal Credit Union Act (12 U.S.C. 1784) is amended by adding at the end the following new subsection:

    ‘(e) FLOOD HAZARD INSURANCE COMPLIANCE BY INSURED CREDIT UNIONS REQUIRED-

      ‘(1) EXAMINATION- The Board shall, during each examination conducted under this section, determine whether the insured credit union is complying with the requirements of the National Flood Insurance Program.

      ‘(2) REPORT- Not later than 1 year after the date of enactment of the National Flood Insurance Program Improvement Act of 1994, and biannually thereafter for the next 4 years, the Board shall submit a report to the Congress on compliance by insured credit unions with the requirements of the National Flood Insurance Program. The report shall include a description of the methods used to determine compliance, the number of insured credit unions examined during the reporting year, a listing and total number of insured credit unions found to be in noncompliance, actions taken to correct incidents of noncompliance, and an analysis of compliance, including a discussion of any trends, patterns, and problems, and recommendations regarding reasonable actions to improve the efficiency of the examinations processes.’.

SEC. 207. PENALTIES AND CORRECTIVE ACTIONS FOR FAILURE TO REQUIRE FLOOD INSURANCE, ESCROW, OR NOTIFY.

    Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a), as amended by sections 202 and 204, is amended by adding at the end the following new subsections:

    ‘(f) CIVIL PENALTIES-

      ‘(1) IN GENERAL- A regulated lending institution that is found to have a pattern or practice of violating this section may be assessed a civil penalty by the appropriate Federal entity for lending regulation of not more than $350 for each such violation. A penalty under this subsection may be issued only after notice and an opportunity for a hearing on the record.

      ‘(2) TOTAL AMOUNT- The total amount of penalties assessed under this subsection against a single regulated lending institution for any calendar year may not exceed $100,000.

      ‘(3) SALES OR TRANSFERS- The subsequent sale or other transfer of a loan by a regulated lending institution that has committed a violation of this section shall not affect the liability of the transferring institution with respect to any penalty under this subsection. An institution shall not be liable for a violation relating to a loan committed by another institution that previously held the loan.

      ‘(4) 3-YEAR LIMIT- No penalty may be imposed under this subsection after the expiration of the 3-year period beginning on the date of the occurrence of the violation.

    ‘(g) ADDITIONAL ACTIONS- If a Federal entity for lending regulation determines--

      ‘(1) that a regulated lending institution has demonstrated a pattern and practice of noncompliance in violation of the regulations issued pursuant to subsection (b) or subsection (d) or the notice requirements under section 1364 of the National Flood Insurance Act of 1968, and

      ‘(2) that the regulated lending institution has not demonstrated measurable improvement in compliance despite the issuance of penalties under subsection (f),

    the agency may require the regulated lending institution to take such remedial actions as are necessary to ensure that the regulated lending institution is in satisfactory compliance with the requirements of the National Flood Insurance Program.’.

SEC. 208. FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL.

    Section 1006 of the Federal Financial Institutions Examination Council Act of 1978 (12 U.S.C. 3305) is amended by adding at the end the following new subsection:

    ‘(g) FLOOD INSURANCE- The Council shall consult with and assist the Federal entities for lending regulation, as such term is defined in section 1370(a)(7) of the National Flood Insurance Act of 1968, in developing and coordinating uniform standards and requirements for use by regulated lending institutions under the National Flood Insurance Program.’.

SEC. 209. CONFORMING AMENDMENT.

    The section heading for section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a) is amended to read as follows:

‘SEC. 102. FLOOD INSURANCE PURCHASE AND COMPLIANCE REQUIREMENTS AND ESCROW ACCOUNTS.’.

TITLE III--RATINGS AND INCENTIVES FOR COMMUNITY FLOODPLAIN MANAGEMENT PROGRAMS

SEC. 301. COMMUNITY RATING SYSTEM AND INCENTIVES FOR COMMUNITY FLOODPLAIN MANAGEMENT.

    (a) REQUIREMENT FOR PARTICIPATION IN FLOOD INSURANCE PROGRAM- Section 1315 of the National Flood Insurance Act of 1968 (42 U.S.C. 4022) is amended--

      (1) by striking ‘after December 31, 1971’ and inserting the following:

    ‘(a) REQUIREMENT FOR PARTICIPATION IN FLOOD INSURANCE PROGRAM- After December 31, 1971’; and

      (2) by adding at the end the following new subsection:

    ‘(b) COMMUNITY RATING SYSTEM AND INCENTIVES FOR COMMUNITY FLOODPLAIN MANAGEMENT-

      ‘(1) AUTHORITY AND GOALS- The Director shall carry out a community rating system program (hereafter in this subsection referred to as the ‘program’) which shall--

        ‘(A) evaluate the measures adopted by communities voluntarily participating in the community rating system;

        ‘(B) provide incentives for measures to reduce the risk of flood damage that exceed the criteria set forth in section 1361;

        ‘(C) encourage adoption of more effective measures for floodplain and erosion management; and

        ‘(D) to promote the reduction of Federal flood insurance losses.

      ‘(2) INCENTIVES- The program shall provide incentives in the form of credits on premium rates for flood insurance coverage in communities that the Director determines have adopted and enforced measures to reduce the risk of flood damage that exceed the criteria set forth in section 1361. In providing incentives under this paragraph, the Director may provide for credits to flood insurance premium rates in communities that the Director determines have--

        ‘(A) implemented measures to enhance floodplain management; and

        ‘(B) adopted erosion control measures.

      ‘(3) CREDITS- The credits on premium rates for flood insurance coverage shall be based on the estimated reduction in flood damage risks resulting from the measures adopted by the community under this program, minus any funds received for mitigation assistance under section 1366. The Director may also reduce such credits to recover the cost to the Federal Government of expenditures for flood or disaster relief to property owners who did not maintain flood insurance on structures in areas having special flood hazards.’.

    (b) REPORTS- Two years after the date of enactment of this Act and biannually thereafter, the Director shall submit a report to the Congress regarding the program under section 1315(a) of the National Flood Insurance Act of 1968. Each report shall include an analysis of the cost-effectiveness and other accomplishments and shortcomings of the program and any recommendations of the Director for legislation regarding the program.

SEC. 302. COMMUNITY EROSION HAZARD MANAGEMENT PROGRAM.

    Section 1315 of the National Flood Insurance Act of 1968 (42 U.S.C. 4022), as amended by section 301, is amended by adding at the end the following new subsection:

    ‘(c) COMMUNITY EROSION HAZARD MANAGEMENT PROGRAM-

      ‘(1) AUTHORITY AND GOALS- The Director shall carry out a community erosion hazard management program (hereafter in this subsection referred to as the ‘program’) which shall--

        ‘(A) assist communities having erosion hazards to understand the nature and extent of the erosion hazards and to develop a program to manage erosion hazards;

        ‘(B) provide incentives for communities to voluntarily undertake measures to reduce the risk of erosion-related flood damage; and

        ‘(C) promote the reduction of Federal flood insurance losses related to erosion hazards.

      ‘(2) DEVELOPMENT OF COMMUNITY EROSION HAZARD MANAGEMENT PLAN- In developing the program, the Director shall meet with appropriate representatives of communities with erosion hazards to discuss the nature and extent of the erosion hazards in the community and the potential development and implementation of an erosion hazard management plan, including--

        ‘(A) the areas identified as having erosion hazards;

        ‘(B) the impact of the erosion hazards on structures located in the erosion hazard areas in the event of flooding;

        ‘(C) the amount of any cross-subsidy among flood insurance policyholders in the community as a result of the insured structures located in erosion hazard areas; and

        ‘(D) alternative cost-effective measures available to the community to manage the erosion hazards, including--

          ‘(i) erosion control projects to reduce or eliminate the risk of erosion-related flood damage;

          ‘(ii) the establishment of building codes to protect structures from erosion-related flood damage;

          ‘(iii) appropriate land use measures to guide development away from erosion hazards;

          ‘(iv) the relocation of structures at risk of erosion-related flood damage; and

          ‘(v) the elimination of any cross-subsidy among flood insurance policyholders in the community resulting in the assessment of actuarial premium rates for new construction in erosion hazard areas.

      ‘(3) ELIGIBILITY FOR ASSISTANCE UNDER THE STATE AND COMMUNITY MITIGATION ASSISTANCE PROGRAM- Communities voluntarily participating in the program shall be eligible for technical and financial assistance under section 1367 for the development and implementation of a community erosion hazard management plan approved by the Director that reduces the risk of erosion-related flood damage.

      ‘(4) INCENTIVES- The program shall provide incentives in the form of credits on premium rates for insurance coverage in communities that the Director determines have adopted and enforced measures to reduce the risk of erosion-related flood damage.

      ‘(5) CREDITS- The credits on premium rates for flood insurance coverage under the program shall be based on the estimated reduction in erosion-related flood damage risks resulting from the measures adopted by the community under this program minus any funds received for assistance under section 1367.’.

SEC. 303. FUNDING.

    Section 1310(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 4017(a)) 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 a semicolon; and

      (3) by adding after paragraph (5) the following new paragraph:

      ‘(6) for carrying out the programs established under subsections (b) and (c) of section 1315.’.

TITLE IV--MITIGATION OF FLOOD AND EROSION RISKS

SEC. 401. MITIGATION ASSISTANCE IN FEDERAL INSURANCE ADMINISTRATION.

    Section 1105(a) of the Housing and Urban Development Act of 1968 (42 U.S.C. 4129) is amended--

      (1) by striking ‘(a) There is hereby’ and inserting the following:

    ‘(a) ESTABLISHMENT- There is hereby’; and

      (2) by striking subsection (b) and inserting the following:

    ‘(b) COORDINATION OF MITIGATION ACTIVITIES- The Director shall coordinate all mitigation activities, including the administration of the program for mitigation assistance under section 1367, under the Federal Insurance Administrator. These activities shall include the development and implementation of various mitigation activities and techniques, the provision of advice and assistance regarding mitigation to States, communities, and individuals, including planning assistance under section 1367(d), coordination with other Federal flood and erosion mitigation efforts, and coordination with State and local governments and public and private agencies and organizations for collection and dissemination of information regarding erosion.’.

SEC. 402. AUTHORIZATION OF NATIONAL FLOOD AND EROSION MITIGATION FUNDS UNDER SECTION 1367.

    (a) EXPENDITURES- Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.), as amended by section 205, is amended by adding at the end the following new section:

‘SEC. 1366. NATIONAL FLOOD AND EROSION MITIGATION PROGRAM.

    ‘For flood and erosion mitigation activities authorized under section 1367, the Director may expend from the National Flood Insurance Fund--

      ‘(1) up to $10,000,000 in the fiscal year ending September 30, 1994;

      ‘(2) up to $15,000,000 in the fiscal year ending September 30, 1995;

      ‘(3) up to $20,000,000 in the fiscal year ending September 30, 1996;

      ‘(4) up to $20,000,000 in each fiscal year thereafter; and

      ‘(5) any amounts recaptured under section 1367(i).’.

    (b) REPORT- Not later than 1 year after the date of enactment of this Act and biannually thereafter, the Director shall submit a report to the Congress describing the status of flood and erosion mitigation activities carried out with funds authorized under section 1366 of the National Flood Insurance Act of 1968, as added by subsection (a).

SEC. 403. STATE AND COMMUNITY MITIGATION ASSISTANCE PROGRAM.

    (a) IN GENERAL- Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.), as amended by sections 205 and 402, is amended by adding at the end the following new section:

‘SEC. 1367. MITIGATION ASSISTANCE FOR STATES, COMMUNITIES, AND INDIVIDUALS.

    ‘(a) AUTHORITY- The Director shall develop and implement a financial assistance program with amounts made available under section 1366 to States, communities, and individuals for planning and activities designed to reduce the risk of flood and erosion damage to insured structures.

    ‘(b) REQUIREMENT FOR MITIGATION PLAN OR APPLICATION-

      ‘(1) STATES AND COMMUNITIES- To be eligible to receive financial mitigation assistance, a State or community shall develop, and have approved by the Director, a flood and erosion risk mitigation plan (hereafter in this section referred to as a ‘mitigation plan’), that is more protective against flood losses than the criteria established by the Director under section 1361. The mitigation plan shall include a comprehensive strategy for mitigation activities adopted by the State or community following a public hearing.

      ‘(2) INDIVIDUALS- For an individual to be eligible to receive financial mitigation assistance for a property--

        ‘(A) the property shall have been continuously covered by a contract for flood insurance under this title for the preceding 24 months; and

        ‘(B) the individual shall submit, and have approved by the Director, an application for such assistance, as the Director shall require.

    ‘(c) NOTIFICATION OF APPROVAL- Not later than 120 days after the submission of a mitigation plan or application, the Director shall notify the State, community, or individual submitting the plan or application of the Director’s approval or disapproval of the plan or application. If the Director does not approve a plan or application, the Director shall notify the State, community, or individual in writing of the reasons for such disapproval.

    ‘(d) PLANNING ASSISTANCE-

      ‘(1) IN GENERAL- The Director shall make planning assistance available to States and communities for developing mitigation plans.

      ‘(2) FUNDING- From any amounts made available for use under section 1366 of the National Flood Insurance Act of 1968 in any fiscal year, the Director may use not more than $1,500,000 to provide planning assistance grants to States or communities to develop mitigation plans under this subsection.

      ‘(3) LIMITATIONS-

        ‘(A) TIMING- A grant for planning assistance may be awarded to a State or community once every 5 years and each grant may cover a period of 1 to 3 years.

        ‘(B) AMOUNT- A grant for planning assistance may not exceed--

          ‘(i) $150,000, to any State; or

          ‘(ii) $50,000, to any community.

        ‘(C) GEOGRAPHIC- Not more than $300,000 may be awarded to any 1 State and all communities located in that State for planning assistance in each fiscal year.

    ‘(e) ELIGIBLE MITIGATION ACTIVITIES- The Director shall determine eligibility for assistance under this section for mitigation activities that shall be technically feasible and cost-effective. These activities may include--

      ‘(1) elevation, relocation, demolition, or floodproofing of structures;

      ‘(2) the construction, repair, or restoration of levees, seawalls, and other structures that reduce the risk of flood damage;

      ‘(3) erosion control measures including beach nourishment;

      ‘(4) acquisition by States and communities of property substantially damaged by flood for public use as the Director determines is consistent with sound land management and use in such area; and

      ‘(5) provision of technical assistance by States to communities and individuals to conduct eligible mitigation activities.

    The Director may provide assistance under this section to an individual for mitigation activities under this subsection only if the activities proposed in the application are consistent with any applicable land use and control measures adopted by the appropriate public body under section 1315 and any applicable mitigation plan.

    ‘(f) LIMITATIONS ON MITIGATION ASSISTANCE-

      ‘(1) AMOUNT- The amount of mitigation assistance provided under subsection (e) may not exceed in any 5-year period--

        ‘(A) $10,000,000, to any State; or

        ‘(B) $3,300,000, to any community.

      ‘(2) GEOGRAPHIC- Not more than $20,000,000 may be awarded to any 1 State and all communities located in that State for mitigation assistance in any 5-year period.

      ‘(3) TREATMENT OF ASSISTANCE FOR INDIVIDUALS- The amount of mitigation assistance provided under subsection (e) to any individual shall be included, for purposes of the dollar amount limitations under paragraphs (1) and (2) of this subsection, in the amount of assistance provided to the State and community within which is located the property for which the grant is made.

    ‘(g) MATCHING REQUIREMENT- The Director may provide mitigation assistance to a State or community in an amount not to exceed 3 times the amount that the State or community certifies, as the Director shall require, that the State or community will contribute from other funds to carry out mitigation planning under subsection (d) and eligible activities under subsection (e).

    ‘(h) OVERSIGHT OF MITIGATION PLANS AND APPLICATIONS- The Director shall conduct oversight of recipients of mitigation assistance to ensure that the mitigation assistance is used in compliance with approved plans and applications.

    ‘(i) RECAPTURE- If the Director determines that a State, community, or individual that has received mitigation assistance has not carried out the mitigation activities as set forth in the mitigation plan or application, the Director shall recapture any unexpended amounts and deposit the amounts in the Fund.

    ‘(j) DEFINITION OF COMMUNITY- For purposes of this section, the term ‘community’ means a political subdivision that has zoning and building code jurisdiction over a particular area having special flood hazards, and that is participating in the National Flood Insurance Program.

    ‘(k) PREFERENCES FOR MITIGATION GRANTS TO COMMUNITIES-

      ‘(1) COST-BENEFICIALNESS- In providing mitigation grants to communities under this section, the Director shall give preference to communities and individuals with mitigation plans that are the most cost-beneficial to the National Flood Insurance Program.

      ‘(2) ADDITIONAL OPTIONAL CRITERIA- Subject to paragraph (1), in providing mitigation grants to communities under this section, the Director may give preference to communities that--

        ‘(A) have the highest rates of participation by property owners in the National Flood Insurance Program;

        ‘(B) have qualified for credits on premium rates under section 1315(b); and

        ‘(C) have experienced repetitive losses that have been most costly to the Fund.’.

    (b) REGULATIONS- Not later than 6 months after date of enactment of this Act, the Director shall issue regulations implementing section 1367 of the National Flood Insurance Act of 1968, as added by subsection (a).

SEC. 404. REPEAL OF PROGRAM FOR PURCHASE OF CERTAIN INSURED PROPERTIES.

    (a) REPEAL- Section 1362 of the National Flood Insurance Act of 1968 (42 U.S.C. 4103) is repealed.

    (b) TRANSITION- Notwithstanding the repeal under subsection (a), the Director may continue to purchase property under subsections (a) and (b) of section 1362 of the National Flood Insurance Act of 1968, as such section existed immediately before the date of enactment of this Act, for a period of 1 year beginning on the date of enactment of this Act.

SEC. 405. TERMINATION OF EROSION THREATENED STRUCTURES PROGRAM.

    (a) IN GENERAL- Section 1306 of the National Flood Insurance Act of 1968 (42 U.S.C. 4013) is amended by striking subsection (c).

    (b) TRANSITION- The Director may pay amounts under flood insurance contracts for demolition or relocation of structures as provided in section 1306(c) of the National Flood Insurance Act of 1968 (as in effect immediately before the date of enactment of this Act) only during the 1-year period beginning on the date of enactment of this Act.

TITLE V--TASK FORCE, ADVISORY COUNCIL, AND STUDIES

SEC. 501. FLOOD INSURANCE INTERAGENCY TASK FORCE.

    (a) ESTABLISHMENT- There is established an interagency task force to be known as the Flood Insurance Task Force (hereafter in this title referred to as the ‘Task Force’).

    (b) MEMBERSHIP-

      (1) IN GENERAL- The Task Force shall consist of 13 members, who shall be the designees of--

        (A) the Director;

        (B) the Federal Housing Commissioner;

        (C) the Secretary of Veterans Affairs;

        (D) the Administrator of the Farmers Home Administration;

        (E) the Administrator of the Small Business Administration;

        (F) each member of the Federal Financial Institutions Examination Council;

        (G) the chairman of the Board of Directors of the Federal Home Loan Mortgage Corporation;

        (H) the chairman of the Board of Directors of the Federal National Mortgage Association; and

        (I) the chairman of the Federal Agricultural Mortgage Corporation.

      (2) QUALIFICATIONS- Members of the Task Force shall be designated for membership on the Task Force by reason of demonstrated knowledge and competence regarding the National Flood Insurance Program.

    (c) DUTIES- The Task Force shall--

      (1) make recommendations to the head of each Federal agency and corporation referred to under subsection (b)(1) regarding the establishment or adoption of standardized enforcement procedures among such agencies and corporations responsible for enforcing compliance with the requirements under the National Flood Insurance Program to ensure the fullest possible compliance with such requirements;

      (2) study the extent to which Federal agencies and the secondary mortgage market can provide assistance in ensuring compliance with the requirements under the National Flood Insurance Program;

      (3) study the extent to which existing programs of Federal agencies and corporations for compliance with the requirements under the National Flood Insurance Program can serve as a model for other Federal agencies responsible for enforcing compliance, and submit to the Congress a report describing the study and any conclusions;

      (4) study--

        (A) the extent to which the flood insurance premium rate structure could be revised, consistent with the goal of providing affordable flood insurance, to minimize existing premium rate subsidies, and account for catastrophic loss events; and

        (B) how changes in the premium rate structure could potentially impact other Federal disaster assistance programs;

      (5) propose strategies, consistent with the goal of providing affordable flood insurance, to establish an actuarial-based premium structure to account for all insurable flood-related risks identified under the National Flood Insurance Act of 1968, as amended by this Act; and

      (6) develop guidelines regarding enforcement and compliance procedures, based on the studies and findings of the Task Force and publishing the guidelines in a usable format.

    (d) REPORTS- Not later than 2 years after the date of enactment of this Act, the Task Force shall transmit to the Congress a report describing its studies and any conclusions.

    (e) COMPENSATION- Members of the Task Force shall receive no additional compensation by reason of their service on the Task Force.

    (f) CHAIRPERSON- The members of the Task Force shall elect 1 member to serve as the chairperson of the Task Force (hereafter in this section referred to as the ‘Chairperson’).

    (g) MEETINGS AND ACTION- The Task Force shall meet at the call of the Chairperson or a majority of the members of the Task Force and may take action by a vote of the majority of the members. The Federal Insurance Administrator shall coordinate and call the initial meeting of the Task Force.

    (h) OFFICERS- The Chairperson may appoint officers to carry out the duties of the Task Force under subsection (c).

    (i) STAFF OF FEDERAL AGENCIES- Upon the request of the Chairperson, the head of any of the Federal agencies and corporations referred to in subsection (b)(1) may detail, on a nonreimbursable basis, any of the personnel of the agency to the Task Force to assist the Task Force in carrying out its duties under this Act.

    (j) POWERS- In carrying out this section, the Task Force may hold hearings, sit and act at times and places, take testimony, receive evidence and assistance, provide information, and conduct research as the Task Force considers appropriate.

    (k) TERMINATION- The Task Force shall terminate 2 years after the date on which all members of the Task Force have been designated under subsection (b)(1).

SEC. 502. TECHNICAL MAPPING ADVISORY COUNCIL.

    (a) ESTABLISHMENT- There is established a council to be known as the Technical Mapping Advisory Council (hereafter in this section referred to as the ‘Council’).

    (b) MEMBERSHIP-

      (1) IN GENERAL- The Council shall consist of the Director, or the Director’s designee, and 12 additional members to be appointed by the Director or his designee, and shall include--

        (A) the Under Secretary of Commerce for Oceans and Atmosphere (or his or her designee);

        (B) a member of recognized surveying and mapping professional associations and organizations;

        (C) a member of recognized professional engineering associations and organizations;

        (D) a member of recognized professional associations or organizations representing flood hazard determination firms;

        (E) a representative of the United States Geologic Survey;

        (F) a representative of State geologic survey programs;

        (G) a representative of State national flood insurance coordination offices;

        (H) a representative of the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation; and

        (I) a representative of a regulated lending institution.

      (2) QUALIFICATIONS- Members of the Council shall be appointed based on their demonstrated knowledge and competence regarding surveying, cartography, remote sensing, geographic information systems, or the technical aspects of preparing and using flood insurance rate maps.

    (c) DUTIES- The Council shall--

      (1) make recommendations to the Director on how to improve in a cost-effective manner the accuracy, general quality, ease of use, and distribution and dissemination of flood insurance rate maps;

      (2) recommend to the Director mapping standards and guidelines for flood insurance rate maps; and

      (3) transmit an annual report to the Director describing--

        (A) the activities of the Council;

        (B) an evaluation of the status and performance of flood insurance rate maps and mapping activities to update and revise flood insurance rate maps as established by the amendments made under section 604; and

        (C) a summary of recommendations made by the Council to the Director.

    (d) CHAIRPERSON- The members of the Council shall elect 1 member to serve as the chairperson of the Council (hereafter in this section referred to as the ‘Chairperson’).

    (e) COORDINATION- To ensure that the Council’s recommendations are consistent to the maximum extent practicable with national digital spatial data collection and management standards, the Chairperson shall consult with the Chairperson of the Federal Geographic Data Committee (established pursuant to OMB Circular A-16).

    (f) COMPENSATION- Members of the Council shall receive no additional compensation by reason of their service on the Council.

    (g) MEETINGS AND ACTIONS-

      (1) IN GENERAL- The Council shall meet not less than twice each year at the request of the Chairperson or a majority of its members and may take action by a vote of the majority of the members.

      (2) INITIAL MEETING- The Director, or a person designated by the Director, shall request and coordinate the initial meeting of the Council.

    (h) OFFICERS- The Chairperson may appoint officers to assist in carrying out the duties of the Council under subsection (c).

    (i) STAFF OF THE FEDERAL EMERGENCY MANAGEMENT AGENCY- Upon the request of the Chairperson, the Director may detail, on a nonreimbursable basis, personnel of the Federal Emergency Management Agency to assist the Council in carrying out its duties.

    (j) POWERS- In carrying out this section, the Council may hold hearings, receive evidence and assistance, provide information, and conduct research as it considers appropriate.

    (k) TERMINATION- The Council shall terminate 5 years after the date on which all members of the Council have been appointed under subsection (b)(1).

SEC. 503. ECONOMIC IMPACT STUDY OF EROSION HAZARD AREAS.

    (a) REPORT TO CONGRESS- Not later than 3 years after the date of enactment of this Act, the Director shall submit to the Congress a report assessing the economic impact of the denial of flood insurance and the establishment of actuarial rates on communities that are likely to be identified as having erosion hazard areas. The report shall include--

      (1) a listing of all communities that are likely to be identified having an erosion hazard area;

      (2) an independent assessment, after consultation with such communities, of the economic impact of the denial of flood insurance for new construction and the assessment of actuarial rates in the erosion hazard areas, including the impact on--

        (A) the value of residential and commercial properties in the erosion hazard area;

        (B) community tax revenues due to changes in property values or commercial activity;

        (C) employment, including the potential loss of existing and new jobs in the community;

        (D) existing businesses and future economic development; and

        (E) the estimated cost of Federal and State disaster assistance to flood victims that would have otherwise been insured by available and affordable flood insurance;

      (3) an estimate of the cross-subsidy of insurance premiums in such communities, and the impact of eliminating the cross-subsidy on those communities and the financial condition of the National Flood Insurance Fund;

      (4) the estimated savings to the National Flood Insurance Program likely to result from expending $25,000,000 from the National Flood Insurance Fund to map erosion hazard areas; and

      (5) an assessment of the need for the development of a Community Erosion Hazard Management Program and, if needed, recommendations consistent with the goal of providing affordable flood insurance protection under the National Flood Insurance Program, which would minimize the economic impact on communities assessed under paragraph (2).

    (b) DEFINITION OF EROSION HAZARD AREA- For the purposes of this section, the term ‘erosion hazard area’ means, based on erosion rate information and other historical data available, an area where erosion or avulsion is likely to result in damage to or loss of buildings and infrastructure during a 60-year period.

    (c) AUTHORIZATION OF APPROPRIATION- There are authorized to be appropriated to the Director $1,000,000 to carry out this section.

SEC. 504. JUSTIFICATION FOR GOVERNMENT OPERATION OF THE NATIONAL FLOOD INSURANCE PROGRAM AND DETERMINATION OF THE FEASIBILITY AND AVAILABILITY OF PRIVATE SECTOR FLOOD INSURANCE COVERAGE.

    (a) REPORT TO CONGRESS- Not later than 3 years after the date of enactment of this Act, the Director shall submit to the Congress a report containing--

      (1) a determination of whether or not it would be feasible for the National Flood Insurance Program, as established under the National Flood Insurance Act of 1968, to be administered by the private insurance industry in accordance with part A of chapter II of such Act and recommendations for modifications to the program to facilitate administration by the private insurance industry;

      (2) if applicable, the reasons and justification, in accordance with section 1340 of the National Flood Insurance Act of 1968, for a determination that the operation of the National Flood Insurance Program cannot be carried out without the Federal Government’s assumption of the operational responsibility for flood insurance under the National Flood Insurance Act of 1968;

      (3) the estimated impact on the availability and affordability of flood insurance if the National Flood Insurance Program were to be administered by the private insurance industry;

      (4) the estimated impact on the cost and efficiency of other Federal emergency management programs, including Federal disaster assistance, if the National Flood Insurance Program were to be administered by the private insurance industry;

      (5) the effect of the Federal Government’s assumption of the operational responsibility for flood insurance on the availability and affordability of private flood insurance coverage; and

      (6) the availability and cost of private flood insurance in each of the communities participating in the National Flood Insurance Program, including a directory of private sector insurance providers.

TITLE VI--MISCELLANEOUS PROVISIONS

SEC. 601. MAXIMUM FLOOD INSURANCE COVERAGE AMOUNTS.

    (a) IN GENERAL- Section 1306(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended--

      (1) in paragraph (1)(A)--

        (A) by inserting ‘and’ at the end of clause (i); and

        (B) by striking clause (iii);

      (2) by striking subparagraph (B) of paragraph (1) and inserting the following new subparagraph:

        ‘(B) in the case of any nonresidential property, including churches--

          ‘(i) $100,000 aggregate liability for each structure; and

          ‘(ii) $100,000 aggregate liability for any contents related to each structure;’;

      (3) by striking subparagraph (C) of paragraph (1);

      (4) in paragraph (2), by striking ‘so as to enable’ and all that follows through the end of the paragraph and inserting ‘up to an amount, including the limits specified in clause (i) of paragraph (1)(A), of $250,000 multiplied by the number of dwelling units in the building;’;

      (5) in paragraph (3), by striking ‘so as to enable’ and all that follows through the end of the paragraph and inserting ‘up to an amount, including the limits specified in clause (ii) of paragraph (1)(A), of $100,000 for any single-family dwelling and $250,000 for any residential structure containing more than one dwelling unit;’; and

      (6) by striking paragraph (4) and inserting the following new paragraph:

      ‘(4) in the case of any nonresidential property, including churches, additional flood insurance in excess of the limits specified in clauses (i) and (ii) of paragraph (1)(B) shall be made available to every insured upon renewal and every applicant for insurance up to an amount, including the limits specified in paragraph (1)(B), of $2,400,000 for each structure and $2,400,000 for any contents related to each structure; and’.

    (b) ACTUARIAL RISK PREMIUMS ON REPETITIVE LOSS STRUCTURES- Section 1306(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended--

      (1) in paragraph (5), by striking ‘and’ at the end;

      (2) in paragraph (6), by striking the period at the end and inserting a semicolon; and

      (3) by adding at the end the following new paragraph:

      ‘(7) upon determining that a property is a repetitive loss structure, and after making a payment to the insured under section 1304(e), the Director shall charge the applicable risk premium rate for flood insurance based on consideration of the risk involved and accepted actuarial principles under section 1307(a)(1), except that the Director may not increase the premium rate above the level authorized in paragraph (7); and’.

    (c) ANNUAL 10-PERCENT PREMIUM RATE INCREASE CAP- Section 1306(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended by adding at the end the following:

      ‘(8) the Director may not increase the premium rate applied to a structure in any 12-month period by more than 10 percent over the rate previously applied to that structure during the preceding 12-month period.’.

    (d) CONFORMING AMENDMENTS- Section 1306(b)(5) of the National Flood Insurance Act of 1968 (42 U.S.C. 4013(b)(5)) is amended--

      (1) by striking ‘(A), (B), or (C)’ and inserting ‘(A) or (B)’; and

      (2) by striking ‘(1)(C),’.

SEC. 602. ADDITIONAL COVERAGE FOR COMPLIANCE WITH LAND USE AND CONTROL MEASURES.

    (a) IN GENERAL- Section 1304(e) of the National Flood Insurance Act of 1968 (42 U.S.C. 4011(a)) is amended by inserting before the period ‘, including the cost of compliance with land use and control measures for properties that are repetitive loss structures or that have flood damage in which the cost of repairs equals or exceeds 50 percent of the value of the structure at the time of the flood event. The Director shall impose a uniform surcharge on each insured of not more than $30 per policy to provide cost of compliance coverage under this section’.

    (b) APPLICABILITY- The provisions of subsection (a) shall apply only to structures that sustain flood-related damage after the date of enactment of this Act.

    (c) REPORT- Not later than 5 years after the date of enactment of this Act, the Director shall submit a report to the Congress describing the activities undertaken to provide insurance coverage for the cost of compliance with land use and control measures under subsection (a). Such report shall evaluate the costs and savings to the National Flood Insurance Program resulting from providing this additional coverage.

SEC. 603. FLOOD INSURANCE PROGRAM ARRANGEMENTS WITH PRIVATE INSURANCE ENTITIES.

    Section 1345(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 4081(b)) is amended by striking the period at the end and inserting the following: ‘and without regard to the provisions of the Federal Advisory Committee Act.’.

SEC. 604. UPDATING OF FLOOD INSURANCE MAPS AND IDENTIFICATION OF EROSION HAZARD AREAS.

    Section 1360 of the National Flood Insurance Act of 1968 (42 U.S.C. 4101) is amended by adding at the end the following new subsections:

    ‘(e) ASSESSMENT OF NEED TO UPDATE AREAS- (1) Once during each 5-year period (the 1st such period beginning on the date of enactment of the National Flood Insurance Program Improvement Act of 1994), or more often as the Director determines necessary, the Director shall assess the need to revise and update the flood insurance rate map.

    ‘(2) Upon the request of a State or community stating that a flood insurance rate map needs revision or updating, the Director shall review and update the flood insurance rate map for the State or community. The Director may require the State or community to pay a portion of the cost of updating the map.

    ‘(f) AVAILABILITY- To promote compliance with the requirements of this title, the Director shall make flood insurance rate maps and related information available free of charge to Federal agencies and to State agencies directly responsible for coordinating the National Flood Insurance Program and to appropriate representatives of communities participating in the National Flood Insurance Program, and at a reasonable cost to all other persons pursuant to section 1310.

    ‘(g) NOTIFICATION- The Director shall publish in the Federal Register or by other comparable method, notices of changes to flood insurance map panels, and changes to flood insurance map panels issued in the form of Letters of Map Amendment and Letters of Map Revision. The map change or revision shall become effective upon publication. Such comparable methods shall include all pertinent information, provide for regular and frequent distribution, and be at least as accessible to map users as the Federal Register. Notices published in the Federal Register, or otherwise, shall also include information on how to obtain copies of the changes or revisions.

    ‘(h) AVAILABILITY- On March 1 and October 1 of each year, the Director shall publish separately and make available in their entirety within a compendium, all changes and revisions to flood insurance map panels and all Letters of Map Amendment and Letters of Map Revision that were published in the Federal Register or distributed through other comparable methods during the preceding 6 months, free of charge, to Federal agencies, States, and communities participating in the National Flood Insurance Program pursuant to section 1310 and at cost to all other persons.’.

SEC. 605. AGRICULTURAL STRUCTURES.

    Section 1361 of the National Flood Insurance Act of 1968 (42 U.S.C. 4102) is amended by adding at the end the following new subsection:

    ‘(d) AGRICULTURAL STRUCTURES-

      ‘(1) EXEMPTION FROM FLOODWAY ACTIVITY RESTRICTIONS- Notwithstanding any other provision of law, the adequate land use and control measures adopted in an area (or subdivision thereof) pursuant to section 1315(a) may provide, at the discretion of the appropriate State or local authority, for the repair and restoration to pre-damaged conditions of an agricultural structure that--

        ‘(A) is a repetitive loss structure; or

        ‘(B) has incurred flood-related damage to the extent that the cost of restoring the structure to its pre-damaged condition would equal or exceed 50 percent of the market value of the structure before the damage occurred.

      ‘(2) DEFINITIONS- For purposes of this subsection--

        ‘(A) the term ‘agricultural structure’ means any structure used exclusively in connection with the production, harvesting, storage, raising, or drying of agricultural commodities; and

        ‘(B) the term ‘agricultural commodities’ means agricultural commodities and livestock.’.

SEC. 606. FUNDING FOR INCREASED ADMINISTRATIVE AND OPERATIONAL RESPONSIBILITIES.

    (a) AVAILABILITY OF FUND- Section 1310(a) of the National Flood Insurance Act of 1968 (42 U.S.C. 4017(a)), as amended by section 303, is amended--

      (1) in the matter preceding paragraph (1), by inserting ‘(except as otherwise provided)’ after ‘without fiscal year limitation’;

      (2) in paragraph (6), as added by section 303 of this Act, by striking the period at the end and inserting ‘; and’; and

      (3) by adding at the end the following new paragraph:

      ‘(7) for revising and updating flood insurance rate maps under section 1360(i), except that the fund shall be available for the purpose under this paragraph in an amount not to exceed $2,000,000, in each fiscal year beginning after the expiration of the 2-year period beginning on the date of enactment of the National Flood Insurance Program Improvement Act of 1994.’.

    (b) CREDITS OF FUND- Section 1310(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 4017(b)) is amended--

      (1) in paragraph (5), by striking ‘and’ at the end;

      (2) by redesignating paragraph (6) as paragraph (7); and

      (3) by inserting after paragraph (5) the following new paragraph:

      ‘(6) any penalties collected under section 102(f) of the Flood Disaster Protection Act of 1973; and’.

SEC. 607. SEPARATE ACCOUNT FOR FLOOD INSURANCE FUND.

    Section 1310(a) of the National Flood Insurance Act (42 U.S.C. 4017(a)) is amended by inserting before ‘which shall be available’ the following: ‘which shall be maintained in the Treasury as an account separate from any other funds available to the Director, and’.

SEC. 608. NONWAIVER OF FLOOD PURCHASE REQUIREMENT FOR RECIPIENTS OF FEDERAL DISASTER ASSISTANCE.

    Section 311(b) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5154(b)) is amended by adding at the end the following: ‘The requirements of this subsection may not be waived under section 301.’.

SEC. 609. INSURANCE WAITING PERIOD.

    Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 4014) is amended by adding at the end the following new subsection:

    ‘(e)(1) The Director shall establish a waiting period of not less than 10 days from the presentment of payment of a premium for the initial purchase of flood insurance under this title. Flood insurance coverage shall not be available with respect to any claim for damage incurred during such waiting period.

    ‘(2) This subsection shall not apply to the initial purchase of flood insurance under this title when the purchase of insurance is in connection with the making, increasing, extension, or renewal of a loan.’.

SEC. 610. IMPLEMENTATION REVIEW BY THE DIRECTOR.

    Section 1320 of the National Flood Insurance Act of 1968 (42 U.S.C. 4027) is amended--

      (1) by striking ‘The Director’ and inserting the following:

    ‘(a) IN GENERAL- The Director’; and

      (2) by adding at the end the following new subsection:

    ‘(b) EFFECTS OF FLOOD INSURANCE PROGRAM- The Director shall include, as part of the biennial report submitted under subsection (a), a chapter reporting on the effects on the flood insurance program observed through implementation of requirements under the National Flood Insurance Program Improvement Act of 1994.’.

SEC. 611. REGULATIONS.

    The Director and the head of any appropriate Federal agency may each issue any regulations necessary to carry out the applicable provisions of this Act and the applicable amendments made by this Act.