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115th Congress } { Report
HOUSE OF REPRESENTATIVES
1st Session } { 115-276
======================================================================
REPEATEDLY FLOODED COMMUNITIES PREPARATION ACT
_______
August 15, 2017.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______
Mr. Hensarling, from the Committee on Financial Services, submitted the
following
R E P O R T
[To accompany H.R. 1558]
[Including cost estimate of the Congressional Budget Office]
The Committee on Financial Services, to whom was referred
the bill (H.R. 1558) to amend the National Flood Insurance Act
of 1968 to ensure community accountability for areas
repetitively damaged by floods, and for other purposes, having
considered the same, report favorably thereon with an amendment
and recommend that the bill as amended do pass.
The amendment is as follows:
Strike all after the enacting clause and insert the
following:
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Repeatedly Flooded Communities
Preparation Act''.
SEC. 2. COMMUNITY ACCOUNTABILITY FOR REPETITIVELY FLOODED AREAS.
(a) In General.--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:
``(e) Community Accountability for Repetitively Damaged Areas.--
``(1) In general.--The Administrator shall, by regulation,
require any covered community (as such term is defined in
paragraph (5))--
``(A) to identify the areas within the community
where properties described in paragraph (5)(B) or
flood-damaged facilities are located to determine areas
repeatedly damaged by floods and to assess, with
assistance from the Administrator, the continuing risks
to such areas;
``(B) to develop a community-specific plan for
mitigating continuing flood risks to such repetitively
flooded areas and to submit such plan and plan updates
to the Administrator at appropriate intervals;
``(C) to implement such plans;
``(D) to make such plan, plan updates, and reports on
progress in reducing flood risk available to the
public, subject to section 552a of title 5, United
States Code.
``(2) Incorporation into existing plans.--Plans developed
pursuant to paragraph (1) may be incorporated into mitigation
plans developed under section 1366 of this Act (42 U.S.C.
4104c) and hazard mitigation plans developed under section 322
of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5165).
``(3) Assistance to communities.--
``(A) Data.--To assist communities in preparation of
plans required under paragraph (1), the Administrator
shall, upon request, provide covered communities with
appropriate data regarding the property addresses and
dates of claims associated with insured properties
within the community.
``(B) Mitigation grants.--In making determinations
regarding financial assistance under the authorities of
this Act, the Administrator may consider the extent to
which a community has complied with this subsection and
is working to remedy problems with addressing
repeatedly flooded areas.
``(4) Sanctions.--
``(A) In general.--The Administrator shall, by
regulations issued in accordance with the procedures
established under section 553 of title 5, United States
Code, regarding substantive rules, provide appropriate
sanctions for covered communities that fail to comply
with the requirements under this subsection or to make
sufficient progress in reducing the flood risks to
areas in the community that are repeatedly damaged by
floods.
``(B) Notice.--Before imposing any sanction pursuant
to this paragraph, the Administrator shall provide the
covered community involved with notice of the non-
compliance that could result in the imposition of
sanctions, which shall include recommendations for
actions to bring the covered community into compliance.
``(C) Considerations.--In determining appropriate
sanctions to impose under this paragraph, the
Administrator shall consider the resources available to
the covered community involved, including Federal
funding, the portion of the covered community that lies
within an area having special flood hazards, and other
factors that make it difficult for the covered
community to conduct mitigation activities for existing
flood-prone structures.
``(5) Covered community.--For purposes of this subsection,
the term `covered community' means a community--
``(A) that is participating, pursuant to section
1315, in the national flood insurance program; and
``(B) within which are located--
``(i) 50 or more repetitive loss structures
for each of which, during any 10-year period,
two or more claims for payments under flood
insurance coverage have been made with a
cumulative amount exceeding $1,000;
``(ii) 5 or more severe repetitive loss
structures (as such term is defined in section
1366(h)) for which mitigation activities
meeting the standards for approval under
section 1366(c)(2)(A) have not been conducted;
or
``(iii) a public facility or a private
nonprofit facility (as such terms are as
defined in section 102 of the Robert T.
Stafford Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5122)), that has
received assistance for repair, restoration,
reconstruction, or replacement under section
406 of the Robert T. Stafford Disaster Relief
and Emergency Assistance Act (42 U.S.C. 5172)
in connection with more than one flooding event
in the most recent 10-year period.
``(6) Repetitive-loss structure.--For purposes of this
subsection, the term `repetitive loss structure' has the
meaning given such term in section 1370 (42 U.S.C. 4121).
``(7) Reports to congress.--Not later than the expiration of
the 6-year period beginning upon the date of the enactment of
this subsection, and not less than every 2 years thereafter,
the Administrator shall submit a report to the Congress
regarding the progress in implementing plans developed pursuant
to paragraph (1)(B).''.
(b) Regulations.--The Administrator of the Federal Emergency
Management Agency shall issue regulations necessary to carry out
subsection (e) of section 1361 of the National Flood Insurance Act of
1968, as added by the amendment made by subsection (a) of this section,
not later than the expiration of the 12-month period that begins on the
date of the enactment of this Act.
SEC. 3. MONTHLY INSTALLMENT PAYMENT OF PREMIUMS.
(a) Authority.--Subsection (g) of section 1308 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4015(g)) is amended--
(1) by striking the subsection designation and all that
follows through ``With respect'' and inserting the following:
``(g) Frequency of Premium Collection.--
``(1) Options.--With respect''; and
(2) by adding at the end the following:
``(2) Monthly installment payment of premiums.--
``(A) Exemption from rulemaking.--Until such time as
the Administrator promulgates regulations implementing
paragraph (1) of this subsection, the Administrator may
adopt policies and procedures, notwithstanding any
other provisions of law and in alignment and consistent
with existing industry escrow and servicing standards,
necessary to implement such paragraph without
undergoing notice and comment rulemaking and without
conducting regulatory analyses otherwise required by
statute, regulation, or Executive order.
``(B) Pilot program.--The Administrator may initially
implement paragraph (1) of this subsection as a pilot
program that provides for a gradual phase-in of
implementation.
``(C) Policyholder protection.--The Administrator
may--
``(i) during the 12-month period beginning on
the date of the enactment of this subparagraph,
charge policyholders choosing to pay premiums
in monthly installments a fee for the total
cost of the monthly collection of premiums not
to exceed $25 annually; and
``(ii) after the expiration of the 12-month
period referred to in clause (i), adjust the
fee charged annually to cover the total cost of
the monthly collection of premiums as
determined by the report submitted pursuant to
subparagraph (D).
``(D) Report.--Not later than six months after the
date of the enactment of this Act, the Comptroller
General shall submit a report to the Committee on
Financial Services of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of
the Senate, that sets forth all of the costs associated
with the monthly payment of premiums, including any up-
front costs associated with infrastructure development,
the impact on all policyholders including those that
exercise the option to pay monthly and those that do
not, options for minimizing the costs, particularly the
costs to policyholders, and the feasibility of adopting
practices that serve to minimize costs to policyholders
such as automatic payments and electronic payments.
``(E) Annual reports.--On an annual basis, the
Administrator shall report to the Committee on
Financial Services of the House of Representatives and
the Committee on Banking, Housing, and Urban Affairs of
the Senate the ongoing costs associated with the
monthly payment of premiums.''.
(b) Implementation.--Clause (ii) of section 1307(a)(1)(B) of the
National Flood Insurance Act of 1968 (42 U.S.C. 4014(a)(1)(B)(ii)) is
amended by inserting before ``any administrative expenses'' the
following: ``the costs associated with the monthly collection of
premiums provided for in section 1308(g) (42 U.S.C. 4015(g)), but only
if such costs exceed the operating costs and allowances set forth in
clause (i) of this subparagraph, and''.
Purpose and Summary
Introduced by Representative Ed Royce on March 16, 2017,
H.R. 1558, the ``Repeatedly Flooded Communities Preparation
Act,'' amends the National Flood Insurance Act of 1968 to
ensure community accountability for areas repetitively damaged
by floods.
Background and Need for Legislation
Floods are among the most frequently occurring and costly
natural disasters. Most declarations of federal disasters by
the Federal Emergency Management Agency (FEMA) are related to
flooding. Yet despite the frequency and severity of losses that
result from flooding, the private insurance market generally
did not provide insurance for flooding; when it did, insurance
for flood-related damage can be expensive because the
properties most at-risk tend to be highly concentrated
geographically and the potential risk of economic losses is
extremely high.
To supplement the availability of flood insurance in the
private market, Congress, in 1968, created the National Flood
Insurance Program (NFIP), which is administered by FEMA and
provides flood insurance to approximately 5.1 million
policyholders across the country. In exchange for premiums paid
by policyholders, NFIP makes federally backed flood insurance
available to homeowners and other property owners (for example,
businesses, churches, and farmers) in these communities.
Homeowners with mortgages held by federally regulated
lenders on property in participating communities identified by
FEMA to be in Special Flood Hazard Areas are required to
purchase flood insurance (mandatory purchase requirement). NFIP
coverage limits vary by program (regular or emergency) and
property type (for example, residential or nonresidential). In
NFIP's regular program, the maximum coverage limits for
residential policyholders are $250,000 for buildings and
$100,000 for contents. For commercial policyholders (that is,
those with policies for nonresidential properties), the maximum
coverage limit is $500,000 per building and $500,000 for
contents owned by the building owner. There is additional
coverage for contents owned by the tenants.
Residents and business owners in over 22,000 participating
communities across the United States and its territories are
able to buy NFIP flood insurance policies through insurance
agents and companies that participate as third-party
administrators in the ``Write Your Own'' (WYO) program. The WYO
program allows private insurance carriers to issue and service
government underwritten and taxpayer backed NFIP policies with
no private financial liability from the insurer. Insurance
companies that participate in the WYO program receive an
expense allowance for policies they write and the claims they
process. In addition, their agents earn a commission for the
policies they sell. The federal government, however, retains
responsibility for managing the risk and paying claims, as well
as covering any litigation costs should a WYO insurer be sued
in court.
Property owners can purchase flood insurance through the
NFIP only if their communities participate in the NFIP. To
participate in the NFIP, a community must agree to abide by
certain statutory provisions intended to mitigate the risk of
flooding, such as building codes that require new structures
built in floodplains (high-risk areas) to be protected against
flooding or to be elevated above the 100-year floodplain.
As of June 5, 2017, the NFIP has an outstanding debt of
$24.6 billion borrowed from taxpayers, with roughly $1.1
billion available cash-on-hand and $5.825 billion remaining of
its total temporary $30.425 billion Treasury borrowing
authority. The NFIP's debt results primarily from its borrowing
to pay claims relating to the Gulf Coast hurricanes in 2005 and
Superstorm Sandy in October 2012. This borrowing stems from a
structural imbalance in how the NFIP measures and prices for
risk, resulting in only 46 percent of premium dollars collected
in 2016 being available for the payments of claims. With such a
low portion of premiums available to pay claims, the pressure
on the NFIP to borrow from taxpayers increases. The NFIP's
structural budget crisis has required periodic legislation to
increase its borrowing authority, the most recent example of
which occurred in January 2013 when Congress increased the
NFIP's borrowing authority by $9.7 billion--from $20.725
billion to its current $30.425 billion level.
The ``Repeatedly Flooded Communities Preparation Act''
addresses a long-standing and serious problem with the NFIP:
the growing number of properties that are repeatedly flooded.
As of January 2016, there were more than 150,000 structures
around the country classified as ``Repeat Loss Properties''
(RLP) by FEMA. FEMA estimates that these properties comprise
just one percent of those insured by NFIP, but represent 25 to
30 percent of all flood claims.
The NFIP has $24.6 billion in debt and according to a 2009
report by the Department of Homeland Security's Inspector
General, the number of repeatedly flooded properties increases
by nearly 5,000 each year and efforts to mitigate are being
outpaced by a factor of 10 to 1. From 1978 through 2011, RLP
losses added up to more than $12 billion--or approximately half
of the NFIP's debt.
H.R. 1558, the ``Repeatedly Flooded Communities Preparation
Act'' will help to proactively reduce flood risk rather than
simply repeatedly rebuilding properties. Specifically, H.R.
1558 would require communities with a significant number of
properties that have repeatedly flooded to: (1) review and
analyze data on local properties and public infrastructure that
flood repeatedly to determine the specific areas that should be
priorities for voluntary buyouts, drainage improvements, or
other mitigation efforts; (2) develop and implement plans for
lowering flood risk in these problem areas; (3) share plans and
reports with the public; and (4) submit these plans as well as
reports on progress to FEMA.
Additionally, the ``Repeatedly Flooded Communities
Preparation Act'' sets deadlines for FEMA to develop criteria
to govern these repeat loss plans and determine any appropriate
sanctions for failure to act. It requires FEMA to report to
Congress every two years on implementation progress.
H.R. 1558 also includes a provision to expedite FEMA's
implementation of a policyholder monthly payment option. The
Homeowner Flood Insurance Affordability Act of 2014 (P.L. 113-
89) required FEMA to offer monthly installment payments for
premiums and provided the agency 18 months to implement the
requirement. This provision will accelerate an implementation
process that is behind schedule and provide that policyholders
be charged no more than $25 during the first year after
enactment; after the 12 month period, policyholders will be
charged an administrative fee that reflects actual costs,
pursuant to a Government Accountability Office study.
Hearings
The Committee on Financial Services' Subcommittee on
Housing & Insurance held two hearings examining matters
relating to H.R. 1558 on March 9, 2017 and March 16, 2017. The
Committee on Financial Services held a hearing examining
matters relating to H.R. 1558 on June 7, 2017.
Committee Consideration
The Committee on Financial Services met in open session on
June 15, 2017 to consider H.R. 1558. The Committee ordered H.R.
1558 to be reported favorably to the House, as amended, by
voice vote, a quorum being present. Before the motion to report
was offered, the Committee adopted an amendment offered by Mr.
Royce, as amended by an amendment offered by Mrs. Maloney, by
voice vote and adopted an amendment offered by Mr. David Scott
of Georgia by voice vote, a quorum being present.
Committee Votes
Clause 3(b) of rule XIII of the Rules of the House of
Representatives requires the Committee to list the record votes
on the motion to report legislation and amendments thereto.
There were no recorded votes for H.R. 1558.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the findings and recommendations of
the Committee based on oversight activities under clause
2(b)(1) of rule X of the Rules of the House of Representatives,
are incorporated in the descriptive portions of this report.
Performance Goals and Objectives
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House of Representatives, the Committee states that H.R. 1558
will protect taxpayers and policyholders by encouraging
communities to mitigate properties that are at risk of
flooding.
New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee adopts as its
own the estimate of new budget authority, entitlement
authority, or tax expenditures or revenues contained in the
cost estimate prepared by the Director of the Congressional
Budget Office pursuant to section 402 of the Congressional
Budget Act of 1974.
Committee Cost Estimate
The Committee adopts as its own the cost estimate prepared
by the Director of the Congressional Budget Office pursuant to
section 402 of the Congressional Budget Act of 1974.
Congressional Budget Office Estimates
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, August 9, 2017.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 1558, the
Repeatedly Flooded Communities Preparation Act.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contact is Robert Reese.
Sincerely,
Mark P. Hadley
(For Keith Hall).
Enclosure.
H.R. 1558--Repeatedly Flooded Communities Preparation Act
Summary: The Federal Emergency Management Agency (FEMA)
provides flood insurance coverage to property owners through
the National Flood Insurance Program (NFIP). Property owners
who buy coverage through the NFIP pay annual premiums, which
are credited to the National Flood Insurance Fund and used to
pay flood damage claims submitted by policyholders. Those
collections and payments are not subject to annual
appropriation.
H.R. 1558 would direct FEMA to require certain communities
that participate in the NFIP to implement community-wide plans
for flood mitigation. H.R. 1558 also would require FEMA to
allow certain NFIP policyholders to pay their annual premiums
in monthly installments.
CBO estimates that implementing the bill would have no
significant effect on spending subject to appropriation in any
year. Enacting H.R. 1558 would affect direct spending;
therefore, pay-as-you-go procedures apply. However, CBO
estimates that, on net, those effects would not be significant.
Enacting the bill would not affect revenues.
CBO estimates that enacting H.R. 1558 would not
significantly increase net direct spending or on-budget
deficits in any of the four consecutive 10-year periods
beginning in 2028.
H.R. 1558 contains no intergovernmental or private-sector
mandates as defined in the Unfunded Mandates Reform Act (UMRA)
and would impose no costs on state, local, or tribal
governments.
Estimated cost to the Federal Government: The costs of this
legislation fall within budget function 450 (community and
regional development). Enacting the bill could affect claims
and premiums but any such effects would be offset by changes in
collections or costs, so that the net effect would not be
significant.
Basis of estimate: For this estimate, CBO assumes that H.R.
1558 will be enacted near the end of fiscal year 2017.
Community accountability for repetitively flooded areas
H.R. 1558 would direct FEMA to create regulations that
requires communities that choose to participate in the NFIP to
implement mitigation plans designed to reduce the risk and cost
of potential damage from floods in future years. The
regulations would be aimed at communities that have:
50 or more repetitive loss structures,
5 or more severe repetitive loss structures,
or
A public or private nonprofit facility that
has been damaged by flooding and received federal
assistance to repair it in the past 10 years.
H.R. 1558 would define a ``repetitive loss structure'' as a
structure that has had, within a 10-year period, two or more
flood claims totaling over $1,000 each. A severe repetitive
loss structure is currently defined as:
A structure that has received four or more
separate NFIP claims payments, with the amount of each
such payment exceeding $5,000, or
A structure that has received two separate
NFIP claims payments with the cumulative amount
surpassing the value of the structure.
Under the bill, regulations would include appropriate
sanctions for communities that do not adequately implement a
mitigation plan. Such sanctions would be left to the discretion
of FEMA.
Based on the cost to FEMA of implementing similar
regulations and on the types of sanctions likely to be adopted,
CBO estimates that increased administrative costs under this
section would total less than $500,000 in any year. Such
spending would be subject to the availability of appropriated
funds.
CBO has no basis to evaluate the extent or the
effectiveness of any mitigation measures that may be adopted by
communities as a result of the proposed regulations. Depending
on the level of state and local community spending on the
targeted properties, such mitigation measures could
significantly reduce the cost of future NFIP claims. However,
adopting measures to make individual structures more resilient
to flood damage also would reduce the risk-based premiums that
policyholders pay to FEMA for insurance. Furthermore, because
implementing flood-mitigation measures for individual
properties is costly for local communities, whether or not
those communities would devote significant resources to this
effort is unclear. Therefore, CBO expects that the program's
net costs would be little changed by this provision.
Monthly installment payment of premiums
Under current law, FEMA must provide certain NFIP
policyholders who are not required to escrow their premiums and
fees for flood insurance the option to pay premiums on either
an annual or monthly basis. Because FEMA has not issued
regulations implementing that requirement, all NFIP
policyholders not subject to escrow requirements currently pay
their premiums annually. CBO estimates that under current law
only a small number of policies could pay premiums on a monthly
basis because most properties are subject to mortgages with a
lending institution that require them to escrow their insurance
payments. The institutions remit those premiums directly to
FEMA on the homeowners' behalf, usually on an annual basis.
H.R. 1558 would direct FEMA to implement a pilot program to
allow eligible policyholders to pay premiums in monthly
installments without first implementing the relevant
regulations. The pilot program would last for one year before
phasing into a regular program.
During the pilot program FEMA would be authorized to charge
policyholders who opt to pay their premiums on a monthly basis
a fee of up to $25 a year. That fee would be used to offset any
administrative costs associated with collecting, storing, and
processing payments on a monthly basis. After the first year,
FEMA would be authorized to adjust the fee to cover the total
added cost of collecting premiums on a monthly basis for all
eligible policyholders who choose to pay on such a schedule.
If large numbers of eligible policyholders elected to pay
their premiums on a monthly basis the timing of when insurance
premiums are collected would change, but there would otherwise
be no significant effect on the cost of insurance claims or
purchase of insurance.
Pay-As-You-Go considerations: The Statutory Pay-As-You-Go
Act of 2010 establishes budget-reporting and enforcement
procedures for legislation affecting direct spending or
revenues. NFIP collections are classified as offsetting
receipts (a reduction in direct spending). Enacting H.R. 1558
could change collections from policyholders, but any such
collections would be offset by additional administrative costs.
Therefore, CBO estimates that the bill's net effect on direct
spending would be insignificant in 2018 and negligible each
year thereafter. Enacting H.R. 1558 would not affect revenues.
Increase in long-term direct spending and deficits: CBO
estimates that enacting the bill would not significantly
increase net direct spending or on-budget deficits in any of
the four consecutive 10-year periods beginning in 2028.
Intergovernmental and private-sector impact: H.R. 1558
contains no intergovernmental or private-sector mandates as
defined in UMRA and would impose no costs on state, local, or
tribal governments.
Estimate prepared by: Federal costs: Robert Reese; Impact
on state, local, and tribal governments: Rachel Austin; Impact
on the private sector: Logan Smith.
Estimate approved by: H. Samuel Papenfuss, Deputy Assistant
Director for Budget Analysis.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of the section
102(b)(3) of the Congressional Accountability Act.
Earmark Identification
H.R. 1558 does not contain any congressional earmarks,
limited tax benefits, or limited tariff benefits as defined in
clause 9 of rule XXI.
Duplication of Federal Programs
Pursuant to section 3(c)(5) of rule XIII, the Committee
states that no provision of H.R. 1558 establishes or
reauthorizes a program of the Federal Government known to be
duplicative of another Federal program, a program that was
included in any report from the Government Accountability
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most
recent Catalog of Federal Domestic Assistance.
Disclosure of Directed Rulemaking
Pursuant to section 3(i) of H. Res. 5, 115th Cong. (2017),
the Committee states that H.R. 1558 contains no directed
rulemaking.
Section-by-Section Analysis of the Legislation
Sec. 1 Short title
This section cites H.R. 1558 as the ``Repeatedly Flooded
Communities Preparation Act.''
Sec. 2 Community accountability for repetitively flooded areas
The Administrator shall require any covered community to
(1) identify the areas within the community where properties or
flood-damaged facilities are located to determine areas
repeatedly damaged by floods and to assess the continuing risks
to such areas; (2) develop a community-specific plan for
mitigating continuing flood risks to such repetitively flooded
areas and to submit such plan and plan updates to the
Administrator; (3) implement the plan; and (4) make such plan
and plan updates in reducing flood risk available to the
public.
Any plans developed may be incorporated into flood and
hazard mitigation plans developed by the community.
To assist communities under this bill, the Administrator
shall, upon request provide covered communities with
appropriate data regarding the property addresses and dates of
claims associated with insured properties within the community.
In making determinations regarding financial assistance, the
Administrator may consider the extent to which a community has
complied with this bill and is working to remedy problems with
addressing repeatedly flooded areas.
Communities that fail to develop or make sufficient
progress in executing their plan would be subject to
appropriate sanctions, as determined by FEMA. Before imposing
any sanctions, the Administrator shall provide the covered
community involved with notice of the non-compliance that could
result in the imposition of sanctions, and the notice shall
include recommendations for actions to bring the covered
community into compliance. In determining appropriate sanctions
to impose, the Administrator shall consider the resources
available to the covered community, including Federal funding,
the portion of the covered community that lies within an area
having special flood hazards, and other factors that make it
difficult for the covered community to conduct mitigation
activities for existing flood-prone structures.
A covered community is defined as a community that is
participating in the National Flood Insurance Program and (1)
has 50 or more repetitive loss structures for each of which,
during any 10 year period, two or more claims for payments
under flood insurance coverage have been made with a cumulative
amount exceeding $1,000; (2) has 5 or more severe repetitive
loss structures for which mitigation activities have not been
conducted; or (3) has a public facility or a private non-profit
facility that has received federal disaster assistance for
repair, restoration, reconstruction, or replacement in
connection with more than one flooding event in the most recent
10-year period.
No later than the expiration of the six (6) year period
after enactment, and not less than every two (2) years
thereafter, the Administrator shall submit a report to Congress
regarding the progress of implement plans developed pursuant to
this bill.
Sec. 3 Monthly installment payment of premiums
Until the Administrator promulgates regulation, the
Administrator may adopt policies and procedures to finalize the
implementation of the monthly installment payment of premiums
provision, initially required by the Homeowner Flood Insurance
Affordability Act of 2014. For the first year after enactment
of this section, the Administrator may charge policyholders who
choose to make monthly installment payments a fee not to exceed
$25 annually. No later than 6 months after the date of
enactment, the Comptroller General shall submit a report to
Congress that sets forth all of the costs associated with the
monthly payment premiums. Twelve months after the bill's
enactment, the Administrator may adjust the fee charged
annually to cover the total cost of the monthly collection of
premiums as determined by the report. On an annual basis, the
Administrator shall report to Congress the ongoing costs
associated with the monthly payment of premiums.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, and existing law in which no
change is proposed is shown in roman):
NATIONAL FLOOD INSURANCE ACT OF 1968
* * * * * * *
TITLE XIII--NATIONAL FLOOD INSURANCE
* * * * * * *
CHAPTER I--THE NATIONAL FLOOD INSURANCE PROGRAM
* * * * * * *
estimates of premium rates
Sec. 1307. (a) The Administrator is authorized to undertake
and carry out such studies and investigations and receive or
exchange such information as may be necessary to estimate, and
shall from time to time estimate, on an area, subdivision, or
other appropriate basis--
(1) the risk premium rates for flood insurance
which--
(A) based on consideration of--
(i) the risk involved and accepted
actuarial principles; and
(ii) the flood mitigation activities
that an owner or lessee has undertaken
on a property, including differences in
the risk involved due to land use
measures, floodproofing, flood
forecasting, and similar measures, and
(B) including--
(i) the applicable operating costs
and allowances set forth in the
schedules prescribed under section 1311
and reflected in such rates,
(ii) the costs associated with the
monthly collection of premiums provided
for in section 1308(g) (42 U.S.C.
4015(g)), but only if such costs exceed
the operating costs and allowances set
forth in clause (i) of this
subparagraph, and any administrative
expenses (or portion of such expenses)
of carrying out the flood insurance
program which, in his discretion,
should properly be reflected in such
rates,
(iii) any remaining administrative
expenses incurred in carrying out the
flood insurance and floodplain
management programs (including the
costs of mapping activities under
section 1360) not included under clause
(ii), which shall be recovered by a fee
charged to policyholders and such fee
shall not be subject to any agents'
commissions, company expense
allowances, or State or local premium
taxes, and
(iv) all costs, as prescribed by
principles and standards of practice in
ratemaking adopted by the American
Academy of Actuaries and the Casualty
Actuarial Society, including--
(I) an estimate of the
expected value of future costs,
(II) all costs associated
with the transfer of risk, and
(III) the costs associated
with an individual risk
transfer with respect to risk
classes, as defined by the
Administrator,
would be required in order to make such insurance
available on an actuarial basis for any types and
classes of properties for which insurance coverage is
available under section 1305(a) (or is recommended to
the Congress under section 1305(b));
(2) the rates, if less than the rates estimated under
paragraph (1), which would be reasonable, would
encourage prospective insureds to purchase flood
insurance, and would be consistent with the purposes of
this title, and which, together with a fee charged to
policyholders that shall not be not subject to any
agents' commission, company expenses allowances, or
State or local premium taxes, shall include any
administrative expenses incurred in carrying out the
flood insurance and floodplain management programs
(including the costs of mapping activities under
section 1360), except that the Administrator shall not
estimate rates under this paragraph for--
(A) any residential property which is not the
primary residence of an individual;
(B) any severe repetitive loss property;
(C) any property that has incurred flood-
related damage in which the cumulative amounts
of payments under this title equaled or
exceeded the fair market value of such
property;
(D) any business property; or
(E) any property which on or after the date
of enactment of the Biggert-Waters Flood
Insurance Reform Act of 2012 has experienced or
sustained--
(i) substantial damage exceeding 50
percent of the fair market value of
such property; or
(ii) substantial improvement
exceeding 50 percent of the fair market
value of such property; and
(3) the extent, if any, to which federally assisted
or other flood protection measures initiated after the
date of the enactment of this title affect such rates.
(b) In carrying out subsection (a), the Administrator shall,
to the maximum extent feasible and on a reimbursable basis,
utilize the services of the Department of the Army, the
Department of the Interior, The Department of Agriculture, the
Department of Commerce, and the Tennessee Valley Authority,
and, as appropriate, other Federal departments or agencies, and
for such purposes may enter into agreements or other
appropriate arrangements with any persons.
(c) The Administrator shall give priority to conducting
studies and investigations and making estimates under this
section in those States or areas (or subdivisions thereof)
which he has determined have evidenced a positive interest in
securing flood insurance coverage under the flood insurance
program.
(d) Notwithstanding any other provision of law, any structure
existing on the date of enactment of the Flood Disaster
Protection Act of 1973 and located within Avoyelles,
Evangeline, Rapides, or Saint Landry Parish in the State of
Louisiana, which the Administrator determines is subject to
additional flood hazards as a result of the construction or
operation of the Atchafalaya Basin Levee System, shall be
eligible for flood insurance under this title (if and to the
extent it is eligible for such insurance under the other
provisions of this title) at premium rates that shall not
exceed those which would be applicable if such additional
hazards did not exist.
(e) Notwithstanding any other provision of law, any community
that has made adequate progress, acceptable to the
Administrator, on the construction or reconstruction of a flood
protection system which will afford flood protection for the
one-hundred-year frequency flood as determined by the
Administrator, shall be eligible for flood insurance under this
title (if and to the extent it is eligible for such insurance
under the other provisions of this title) at premium rates not
exceeding those which would be applicable under this section if
such flood protection system had been completed. The
Administrator shall find that adequate progress on the
construction or reconstruction of a flood protection system,
based on the present value of the completed flood protection
system, has been made only if: (1) 100 percent of the cost of
the system has been authorized; (2) at least 60 percent of the
cost of the system has been appropriated; (3) at least 50
percent of the cost of the system has been expended; and (4)
the system is at least 50 percent completed.Notwithstanding any
other provision of law, in determining whether a community has
made adequate progress on the construction, reconstruction, or
improvement of a flood protection system, the Administrator
shall consider all sources of funding, including Federal,
State, and local funds.
(f) Notwithstanding any other provision of law, this
subsection shall apply to riverine and coastal levees that are
located in a community which has been determined by the
Administrator of the Federal Emergency Management Agency to be
in the process of restoring flood protection afforded by a
flood protection system that had been previously accredited on
a Flood Insurance Rate Map as providing 100-year frequency
flood protection but no longer does so, and shall apply without
regard to the level of Federal funding of or participation in
the construction, reconstruction, or improvement of the flood
protection system. Except as provided in this subsection, in
such a community, flood insurance shall be made available to
those properties impacted by the disaccreditation of the flood
protection system at premium rates that do not exceed those
which would be applicable to any property located in an area of
special flood hazard, the construction of which was started
prior to the effective date of the initial Flood Insurance Rate
Map published by the Administrator for the community in which
such property is located. A revised Flood Insurance Rate Map
shall be prepared for the community to delineate as Zone AR the
areas of special flood hazard that result from the
disaccreditation of the flood protection system. A community
will be considered to be in the process of restoration if--
(1) the flood protection system has been deemed
restorable by a Federal agency in consultation with the
local project sponsor;
(2) a minimum level of flood protection is still
provided to the community by the disaccredited system;
and
(3) restoration of the flood protection system is
scheduled to occur within a designated time period and
in accordance with a progress plan negotiated between
the community and the Federal Emergency Management
Agency.
Communities that the Administrator of the Federal Emergency
Management Agency determines to meet the criteria set forth in
paragraphs (1) and (2) as of January 1, 1992, shall not be
subject to revised Flood Insurance Rate Maps that contravene
the intent of this subsection. Such communities shall remain
eligible for C zone rates for properties located in zone AR for
any policy written prior to promulgation of final regulations
for this section. Floodplain management criteria for such
communities shall not require the elevation of improvements to
existing structures and shall not exceed 3 feet above existing
grade for new construction, provided the base flood elevation
based on the disaccredited flood control system does not exceed
five feet above existing grade, or the remaining new
construction in such communities is limited to infill sites,
rehabilitation of existing structures, or redevelopment of
previously developed areas.
The Administrator of the Federal Emergency Management Agency
shall develop and promulgate regulations to implement this
subsection, including minimum floodplain management criteria,
within 24 months after the date of enactment of this
subsection.
(g) No Extension of Subsidy to New Policies or Lapsed
Policies.--The Administrator shall not provide flood insurance
to prospective insureds at rates less than those estimated
under subsection (a)(1), as required by paragraph (2) of that
subsection, for--
(1) any policy under the flood insurance program that
has lapsed in coverage,, unless the decision of the
policy holder to permit a lapse in flood insurance
coverage was as a result of the property covered by the
policy no longer being required to retain such
coverage; or
(2) any prospective insured who refuses to accept any
offer for mitigation assistance by the Administrator
(including an offer to relocate), including an offer of
mitigation assistance--
(A) following a major disaster, as defined in
section 102 of the Robert T. Stafford Disaster
Relief and Emergency Assistance Act (42 U.S.C.
5122); or
(B) in connection with--
(i) a repetitive loss property; or
(ii) a severe repetitive loss
property.
(h) Definition.--In this section, the term ``severe
repetitive loss property'' has the following meaning:
(1) Single-family properties.--In the case of a
property consisting of 1 to 4 residences, such term
means a property that--
(A) is covered under a contract for flood
insurance made available under this title; and
(B) has incurred flood-related damage--
(i) for which 4 or more separate
claims payments have been made under
flood insurance coverage under this
chapter, with the amount of each such
claim exceeding $5,000, and with the
cumulative amount of such claims
payments exceeding $20,000; or
(ii) for which at least 2 separate
claims payments have been made under
such coverage, with the cumulative
amount of such claims exceeding the
value of the property.
(2) Multifamily properties.--In the case of a
property consisting of 5 or more residences, such term
shall have such meaning as the Director shall by
regulation provide.
establishment of chargeable premium rates
Sec. 1308. (a) On the basis of estimates made under section
1307 and such other information as may be necessary, the
Administrator shall from time to time prescribe, after
providing notice--
(1) chargeable premium rates for any types and
classes of properties for which insurance coverage
shall be available under section 1305 (at less than the
estimated risk premium rates under section 1307(a)(1),
where necessary), and
(2) the terms and conditions under which, and the
areas (including subdivisions thereof) within which
such rates shall apply.
(b) Such rates shall, insofar as practicable, be--
(1) based on a consideration of the respective risks
involved, including differences in risks due to land
use measures, flood-proofing, flood forecasting, and
similar measures;
(2) adequate, on the basis of accepted actuarial
principles, to provide reserves for anticipated losses,
or if less than such amount consistent with the
objective of making flood insurance available where
necessary at reasonable rates so as to encourage
prospective insureds to purchase such insurance and
with the purposes of this title;
(3) adequate, together with the fee under paragraph
(1)(B)(iii) or (2) of section 1307(a), to provide for
any administrative expenses of the flood insurance and
floodplain management programs (including the costs of
mapping activities under section 1360);
(4) stated so as to reflect the basis for such rates,
including the differences (if any) between the
estimated risk premium rates under section 1307(a)(1)
and the estimated rates under section 1307(a)(2); and
(5) adequate, on the basis of accepted actuarial
principles, to cover the average historical loss year
obligations incurred by the National Flood Insurance
Fund.
(c) Actuarial Rate Properties.--Subject only to the
limitations provided under paragraphs (1) and (2), the
chargeable rate shall not be less than the applicable estimated
risk premium rate for such area (or subdivision thereof) under
section 1307(a)(1) with respect to the following properties:
(1) Post-firm properties.--Any property the
construction or substantial improvement of which the
Administrator determines has been started after
December 31, 1974, or started after the effective date
of the initial rate map published by the Administrator
under paragraph (2) of section 1360 for the area in
which such property is located, whichever is later,
except that the chargeable rate for properties under
this paragraph shall be subject to the limitation under
subsection (e).
(2) Certain leased coastal and river properties.--Any
property leased from the Federal Government (including
residential and nonresidential properties) that the
Administrator determines is located on the river-facing
side of any dike, levee, or other riverine flood
control structure, or seaward of any seawall or other
coastal flood control structure.
(d) With respect to any chargeable premium rate prescribed
under this section, a sum equal to the portion of the rate that
covers any administrative expenses of carrying out the flood
insurance and floodplain management programs which have been
estimated under paragraphs (1)(B)(ii) and (1)(B)(iii) of
section 1307(a) or paragraph (2) of such section (including the
fees under such paragraphs), shall be paid to the
Administrator. The Administrator shall deposit the sum in the
National Flood Insurance Fund established under section 1310.
(e) Annual Limitation on Premium Increases.--Except with
respect to properties described under paragraph (2) of
subsection (c), and notwithstanding any other provision of this
title--
(1) the chargeable risk premium rate for flood
insurance under this title for any property may not be
increased by more than 18 percent each year, except--
(A) as provided in paragraph (4);
(B) in the case of property identified under
section 1307(g); or
(C) in the case of a property that--
(i) is located in a community that
has experienced a rating downgrade
under the community rating system
program carried out under section
1315(b);
(ii) is covered by a policy with
respect to which the policyholder has--
(I) decreased the amount of
the deductible; or
(II) increased the amount of
coverage; or
(iii) was misrated;
(2) the chargeable risk premium rates for flood
insurance under this title for any properties initially
rated under section 1307(a)(2) within any single risk
classification, excluding properties for which the
chargeable risk premium rate is not less than the
applicable estimated risk premium rate under section
1307(a)(1), shall be increased by an amount that
results in an average of such rate increases for
properties within the risk classification during any
12-month period of not less than 5 percent of the
average of the risk premium rates for such properties
within the risk classification upon the commencement of
such 12-month period;
(3) the chargeable risk premium rates for flood
insurance under this title for any properties within
any single risk classification may not be increased by
an amount that would result in the average of such rate
increases for properties within the risk classification
during any 12-month period exceeding 15 percent of the
average of the risk premium rates for properties within
the risk classification upon the commencement of such
12-month period; and
(4) the chargeable risk premium rates for flood
insurance under this title for any properties described
in subparagraphs (A) through (E) of section 1307(a)(2)
shall be increased by 25 percent each year, until the
average risk premium rate for such properties is equal
to the average of the risk premium rates for properties
described under paragraph (3).
(f) Adjustment of Premium.--Notwithstanding any other
provision of law, if the Administrator determines that the
holder of a flood insurance policy issued under this Act is
paying a lower premium than is required under this section due
to an error in the flood plain determination, the Administrator
may only prospectively charge the higher premium rate.
[(g) Frequency of Premium Collection.--With respect] (g)
Frequency of Premium Collection._
(1) Options._With respect to any chargeable premium
rate prescribed under this section, the Administrator
shall provide policyholders that are not required to
escrow their premiums and fees for flood insurance as
set forth under section 102 of the Flood Disaster
Protection Act of 1973 (42 U.S.C. 4012a) with the
option of paying their premiums annually or monthly.
(2) Monthly installment payment of premiums.--
(A) Exemption from rulemaking.--Until such
time as the Administrator promulgates
regulations implementing paragraph (1) of this
subsection, the Administrator may adopt
policies and procedures, notwithstanding any
other provisions of law and in alignment and
consistent with existing industry escrow and
servicing standards, necessary to implement
such paragraph without undergoing notice and
comment rulemaking and without conducting
regulatory analyses otherwise required by
statute, regulation, or Executive order.
(B) Pilot program.--The Administrator may
initially implement paragraph (1) of this
subsection as a pilot program that provides for
a gradual phase-in of implementation.
(C) Policyholder protection.--The
Administrator may--
(i) during the 12-month period
beginning on the date of the enactment
of this subparagraph, charge
policyholders choosing to pay premiums
in monthly installments a fee for the
total cost of the monthly collection of
premiums not to exceed $25 annually;
and
(ii) after the expiration of the 12-
month period referred to in clause (i),
adjust the fee charged annually to
cover the total cost of the monthly
collection of premiums as determined by
the report submitted pursuant to
subparagraph (D).
(D) Report.--Not later than six months after
the date of the enactment of this Act, the
Comptroller General shall submit a report to
the Committee on Financial Services of the
House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the
Senate, that sets forth all of the costs
associated with the monthly payment of
premiums, including any up-front costs
associated with infrastructure development, the
impact on all policyholders including those
that exercise the option to pay monthly and
those that do not, options for minimizing the
costs, particularly the costs to policyholders,
and the feasibility of adopting practices that
serve to minimize costs to policyholders such
as automatic payments and electronic payments.
(E) Annual reports.--On an annual basis, the
Administrator shall report to the Committee on
Financial Services of the House of
Representatives and the Committee on Banking,
Housing, and Urban Affairs of the Senate the
ongoing costs associated with the monthly
payment of premiums.
(h) Rule of Construction.--For purposes of this section, the
calculation of an ``average historical loss year''--
(1) includes catastrophic loss years; and
(2) shall be computed in accordance with generally
accepted actuarial principles.
(i) Rates for Properties Newly Mapped into Areas with Special
Flood Hazards.--Notwithstanding subsection (f), the premium
rate for flood insurance under this title that is purchased on
or after the date of the enactment of this subsection--
(1) on a property located in an area not previously
designated as having special flood hazards and that,
pursuant to any issuance, revision, updating, or other
change in a flood insurance map, becomes designated as
such an area; and
(2) where such flood insurance premium rate is
calculated under subsection (a)(1) of section 1307 (42
U.S.C. 4014(a)(1)),
shall for the first policy year be the preferred risk premium
for the property and upon renewal shall be calculated in
accordance with subsection (e) of this section until the rate
reaches the rate calculated under subsection (a)(1) of section
1307.
(j) Premiums and Reports.--In setting premium risk rates, in
addition to striving to achieve the objectives of this title
the Administrator shall also strive to minimize the number of
policies with annual premiums that exceed one percent of the
total coverage provided by the policy. For any policies
premiums that exceed this one percent threshold, the
Administrator shall report such exceptions to the Committee on
Financial Services of the House of Representatives and the
Committee on Banking, Housing, and Urban Affairs of the Senate.
(k) Consideration of Mitigation Methods.--In calculating the
risk premium rate charged for flood insurance for a property
under this section, the Administrator shall take into account
the implementation of any mitigation method identified by the
Administrator in the guidance issued under section 1361(d) (42
U.S.C. 4102(d)).
(l) Clear Communications.--The Administrator shall clearly
communicate full flood risk determinations to individual
property owners regardless of whether their premium rates are
full actuarial rates.
(m) Protection of Small Businesses, Non-Profits, Houses of
Worship, and Residences.--
(1) Report.--Not later than 18 months after the date
of the enactment of this section and semiannually
thereafter, the Administrator shall monitor and report
to Committee on Financial Services of the House
Representatives and the Committee on Banking, Housing,
and Urban Affairs of the Senate, the Administrator's
assessment of the impact, if any, of the rate increases
required under subparagraphs (A) and (D) of section
1307(a)(2) and the surcharges required under section
1308A on the affordability of flood insurance for--
(A) small businesses with less than 100
employees;
(B) non-profit entities;
(C) houses of worship; and
(D) residences with a value equal to or less
than 25 percent of the median home value of
properties in the State in which the property
is located.
(2) Recommendations.--If the Administrator determines
that the rate increases or surcharges described in
paragraph (1) are having a detrimental effect on
affordability, including resulting in lapsed policies,
late payments, or other criteria related to
affordability as identified by the Administrator, for
any of the properties identified in subparagraphs (A)
through (D) of such paragraph, the Administrator shall,
not later than 3 months after making such a
determination, make such recommendations as the
Administrator considers appropriate to improve
affordability to the Committee on Financial Services of
the House of Representatives and the Committee on
Banking, Housing, and Urban Affairs of the Senate.
* * * * * * *
CHAPTER III--COORDINATION OF FLOOD INSURANCE WITH LAND-MANAGEMENT
PROGRAMS IN FLOOD-PRONE AREAS
* * * * * * *
criteria for land management and use
Sec. 1361. (a) The Administrator is authorized to carry out
studies and investigations, utilizing to the maximum extent
practicable the existing facilities and services of other
Federal departments or agencies, and State and local
governmental agencies, and any other organizations, with
respect to the adequacy of State and local measures in flood-
prone areas as to land management and use, flood control, flood
zoning, and flood damage prevention, and may enter into any
contracts, agreements or other appropriate arrangements to
carry out such authority.
(b) Such studies and investigations shall include, but not be
limited to, laws, regulations or ordinances relating to
encroachments and obstructions on stream channels and
floodways, the orderly development and use of flood plains of
rivers or streams, floodway encroachment lines, and flood plain
zoning, building codes, building permits, and subdivision or
other building restrictions.
(c) On the basis of such studies and investigations, and such
other information as he deems necessary, the Administrator
shall from time to time develop comprehensive critera designed
to encourage, where necessary, the adoption of adequate State
and local measures which, to the maximum extent feasible,
will--
(1) construct the development of land which is
exposed to flood damage where appropriate,
(2) guide the development of proposed construction
away from locations which are threatened by flood
hazards,
(3) assist in reducing damage caused by floods, and
(4) otherwise improve the long-range land management
and use of flood prone areas,
and he shall work closely with and provide any necessary
technical assistance to State, interstate, and local
governmental agencies, to encourage the application of such
criteria and the adoption and enforcement of such measures.
(d) Flood Mitigation Methods for Buildings.--The
Administrator shall establish guidelines for property owners
that--
(1) provide alternative methods of mitigation, other
than building elevation, to reduce flood risk to
residential buildings that cannot be elevated due to
their structural characteristics, including--
(A) types of building materials; and
(B) types of floodproofing; and
(2) inform property owners about how the
implementation of mitigation methods described in
paragraph (1) may affect risk premium rates for flood
insurance coverage under the National Flood Insurance
Program.
(e) Community Accountability for Repetitively Damaged
Areas.--
(1) In general.--The Administrator shall, by
regulation, require any covered community (as such term
is defined in paragraph (5))--
(A) to identify the areas within the
community where properties described in
paragraph (5)(B) or flood-damaged facilities
are located to determine areas repeatedly
damaged by floods and to assess, with
assistance from the Administrator, the
continuing risks to such areas;
(B) to develop a community-specific plan for
mitigating continuing flood risks to such
repetitively flooded areas and to submit such
plan and plan updates to the Administrator at
appropriate intervals;
(C) to implement such plans;
(D) to make such plan, plan updates, and
reports on progress in reducing flood risk
available to the public, subject to section
552a of title 5, United States Code.
(2) Incorporation into existing plans.--Plans
developed pursuant to paragraph (1) may be incorporated
into mitigation plans developed under section 1366 of
this Act (42 U.S.C. 4104c) and hazard mitigation plans
developed under section 322 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act (42 U.S.C.
5165).
(3) Assistance to communities.--
(A) Data.--To assist communities in
preparation of plans required under paragraph
(1), the Administrator shall, upon request,
provide covered communities with appropriate
data regarding the property addresses and dates
of claims associated with insured properties
within the community.
(B) Mitigation grants.--In making
determinations regarding financial assistance
under the authorities of this Act, the
Administrator may consider the extent to which
a community has complied with this subsection
and is working to remedy problems with
addressing repeatedly flooded areas.
(4) Sanctions.--
(A) In general.--The Administrator shall, by
regulations issued in accordance with the
procedures established under section 553 of
title 5, United States Code, regarding
substantive rules, provide appropriate
sanctions for covered communities that fail to
comply with the requirements under this
subsection or to make sufficient progress in
reducing the flood risks to areas in the
community that are repeatedly damaged by
floods.
(B) Notice.--Before imposing any sanction
pursuant to this paragraph, the Administrator
shall provide the covered community involved
with notice of the non-compliance that could
result in the imposition of sanctions, which
shall include recommendations for actions to
bring the covered community into compliance.
(C) Considerations.--In determining
appropriate sanctions to impose under this
paragraph, the Administrator shall consider the
resources available to the covered community
involved, including Federal funding, the
portion of the covered community that lies
within an area having special flood hazards,
and other factors that make it difficult for
the covered community to conduct mitigation
activities for existing flood-prone structures.
(5) Covered community.--For purposes of this
subsection, the term ``covered community'' means a
community--
(A) that is participating, pursuant to
section 1315, in the national flood insurance
program; and
(B) within which are located--
(i) 50 or more repetitive loss
structures for each of which, during
any 10-year period, two or more claims
for payments under flood insurance
coverage have been made with a
cumulative amount exceeding $1,000;
(ii) 5 or more severe repetitive loss
structures (as such term is defined in
section 1366(h)) for which mitigation
activities meeting the standards for
approval under section 1366(c)(2)(A)
have not been conducted; or
(iii) a public facility or a private
nonprofit facility (as such terms are
as defined in section 102 of the Robert
T. Stafford Disaster Relief and
Emergency Assistance Act (42 U.S.C.
5122)), that has received assistance
for repair, restoration,
reconstruction, or replacement under
section 406 of the Robert T. Stafford
Disaster Relief and Emergency
Assistance Act (42 U.S.C. 5172) in
connection with more than one flooding
event in the most recent 10-year
period.
(6) Repetitive-loss structure.--For purposes of this
subsection, the term ``repetitive loss structure'' has
the meaning given such term in section 1370 (42 U.S.C.
4121).
(7) Reports to congress.--Not later than the
expiration of the 6-year period beginning upon the date
of the enactment of this subsection, and not less than
every 2 years thereafter, the Administrator shall
submit a report to the Congress regarding the progress
in implementing plans developed pursuant to paragraph
(1)(B).
* * * * * * *
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