[Congressional Bills 112th Congress]
[From the U.S. Government Publishing Office]
[H.R. 5740 Engrossed in House (EH)]

112th CONGRESS
  2d Session
                                H. R. 5740

_______________________________________________________________________

                                 AN ACT


 
To extend the National Flood Insurance Program, and for other purposes.

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Flood Insurance Program 
Extension Act''.

SEC. 2. EXTENSION OF PROGRAM.

    (a) In General.--Section 1319 of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4026) is amended by striking ``the earlier of the 
date of the enactment into law of an Act that specifically amends the 
date specified in this section or May 31, 2012'' and inserting ``June 
30, 2012''.
    (b) Financing.--Section 1309(a) of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4016(a)) is amended by striking ``the earlier of the 
date of the enactment into law of an Act that specifically amends the 
date specified in this section or May 31, 2012'' and inserting ``June 
30, 2012''.

SEC. 3. USE OF PRIVATE INSURANCE TO SATISFY MANDATORY PURCHASE 
              REQUIREMENT.

    Section 102(b) of the Flood Disaster Protection Act of 1973 (42 
U.S.C. 4012a(b)) is amended--
            (1) in paragraph (1)--
                    (A) by striking ``lending institutions not to 
                make'' and inserting ``lending institutions--
                    ``(A) not to make'';
                    (B) in subparagraph (A), as designated by 
                subparagraph (A) of this paragraph, by striking 
                ``less.'' and inserting ``less; and''; and
                    (C) by adding at the end the following new 
                subparagraph:
                    ``(B) to accept private flood insurance as 
                satisfaction of the flood insurance coverage 
                requirement under subparagraph (A) if the coverage 
                provided by such private flood insurance meets the 
                requirements for coverage under such subparagraph.'';
            (2) in paragraph (2), by inserting after ``provided in 
        paragraph (1).'' the following new sentence: ``Each Federal 
        agency lender shall accept private flood insurance as 
        satisfaction of the flood insurance coverage requirement under 
        the preceding sentence if the flood insurance coverage provided 
        by such private flood insurance meets the requirements for 
        coverage under such sentence.'';
            (3) in paragraph (3), in the matter following subparagraph 
        (B), by adding at the end the following new sentence: ``The 
        Federal National Mortgage Association and the Federal Home Loan 
        Mortgage Corporation shall accept private flood insurance as 
        satisfaction of the flood insurance coverage requirement under 
        the preceding sentence if the flood insurance coverage provided 
        by such private flood insurance meets the requirements for 
        coverage under such sentence.''; and
            (4) by adding at the end the following new paragraph:
            ``(5) Private flood insurance defined.--In this subsection, 
        the term `private flood insurance' means a contract for flood 
        insurance coverage allowed for sale under the laws of any 
        State.''.

SEC. 4. PRIVATIZATION INITIATIVES.

    (a) FEMA and GAO Reports.--Not later than the expiration of the 18-
month period beginning on the date of the enactment of this Act, the 
Administrator of the Federal Emergency Management Agency and the 
Comptroller General of the United States shall each conduct a separate 
study to assess a broad range of options, methods, and strategies for 
privatizing the national flood insurance program and shall each 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 with recommendations for the best manner to 
accomplish such privatization.
    (b) Private Risk-Management Initiatives.--
            (1) Authority.--The Administrator of the Federal Emergency 
        Management Agency may carry out such private risk-management 
        initiatives under the national flood insurance program as the 
        Administrator considers appropriate to determine the capacity 
        of private insurers, reinsurers, and financial markets to 
        assist communities, on a voluntary basis only, in managing the 
        full range of financial risks associated with flooding.
            (2) Assessment.--Not later than the expiration of the 12-
        month period beginning on the date of the enactment of this 
        Act, the Administrator shall assess the capacity of the private 
        reinsurance, capital, and financial markets by seeking 
        proposals to assume a portion of the program's insurance risk 
        and submit to the Congress a report describing the response to 
        such request for proposals and the results of such assessment.
            (3) Protocol for release of data.--The Administrator shall 
        develop a protocol to provide for the release of data 
        sufficient to conduct the assessment required under paragraph 
        (2).
    (c) Reinsurance.--The National Flood Insurance Act of 1968 is 
amended--
            (1) in section 1331(a)(2) (42 U.S.C. 4051(a)(2)), by 
        inserting ``, including as reinsurance of insurance coverage 
        provided by the flood insurance program'' before ``, on such 
        terms'';
            (2) in section 1332(c)(2) (42 U.S.C. 4052(c)(2)), by 
        inserting ``or reinsurance'' after ``flood insurance 
        coverage'';
            (3) in section 1335(a) (42 U.S.C. 4055(a))--
                    (A) by inserting ``(1)'' after ``(a)''; and
                    (B) by adding at the end the following new 
                paragraph:
    ``(2) The Director is authorized to secure reinsurance coverage of 
coverage provided by the flood insurance program from private market 
insurance, reinsurance, and capital market sources at rates and on 
terms determined by the Director to be reasonable and appropriate in an 
amount sufficient to maintain the ability of the program to pay claims 
and that minimizes the likelihood that the program will utilize the 
borrowing authority provided under section 1309.'';
            (4) in section 1346(a) (12 U.S.C. 4082(a))--
                    (A) in the matter preceding paragraph (1), by 
                inserting ``, or for purposes of securing reinsurance 
                of insurance coverage provided by the program,'' before 
                ``of any or all of'';
                    (B) in paragraph (1)--
                            (i) by striking ``estimating'' and 
                        inserting ``Estimating''; and
                            (ii) by striking the semicolon at the end 
                        and inserting a period;
                    (C) in paragraph (2)--
                            (i) by striking ``receiving'' and inserting 
                        ``Receiving''; and
                            (ii) by striking the semicolon at the end 
                        and inserting a period;
                    (D) in paragraph (3)--
                            (i) by striking ``making'' and inserting 
                        ``Making''; and
                            (ii) by striking ``; and'' and inserting a 
                        period;
                    (E) in paragraph (4)--
                            (i) by striking ``otherwise'' and inserting 
                        ``Otherwise''; and
                            (ii) by redesignating such paragraph as 
                        paragraph (5); and
                    (F) by inserting after paragraph (3) the following 
                new paragraph:
            ``(4) Placing reinsurance coverage on insurance provided by 
        such program.''; and
            (5) in section 1370(a)(3) (42 U.S.C. 4121(a)(3)), by 
        inserting before the semicolon at the end the following: ``, is 
        subject to the reporting requirements of the Securities 
        Exchange Act of 1934, pursuant to section 13(a) or 15(d) of 
        such Act (15 U.S.C. 78m(a), 78o(d)), or is authorized by the 
        Director to assume reinsurance on risks insured by the flood 
        insurance program''.
    (d) Assessment of Claims-Paying Ability.--
            (1) Assessment.--Not later than September 30 of each year, 
        the Administrator of the Federal Emergency Management Agency 
        shall conduct an assessment of the claims-paying ability of the 
        national flood insurance program, including the program's 
        utilization of private sector reinsurance and reinsurance 
        equivalents, with and without reliance on borrowing authority 
        under section 1309 of the National Flood Insurance Act of 1968 
        (42 U.S.C. 4016). In conducting the assessment, the 
        Administrator shall take into consideration regional 
        concentrations of coverage written by the program, peak flood 
        zones, and relevant mitigation measures.
            (2) Report.--The Administrator shall submit a report to the 
        Congress of the results of each such assessment, and make such 
        report available to the public, not later than 30 days after 
        completion of the assessment.

SEC. 5. STUDIES OF VOLUNTARY COMMUNITY-BASED FLOOD INSURANCE OPTIONS.

    (a) Studies.--The Administrator of the Federal Emergency Management 
Agency and the Comptroller General of the United States shall each 
conduct a separate study to assess options, methods, and strategies for 
offering voluntary community-based flood insurance policy options and 
incorporating such options into the national flood insurance program. 
Such studies shall take into consideration and analyze how the policy 
options would affect communities having varying economic bases, 
geographic locations, flood hazard characteristics or classifications, 
and flood management approaches.
    (b) Reports.--Not later than the expiration of the 18-month period 
beginning on the date of the enactment of this Act, the Administrator 
of the Federal Emergency Management Agency and the Comptroller General 
of the United States shall each 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 on the results and 
conclusions of the study such agency conducted under subsection (a), 
and each such report shall include recommendations for the best manner 
to incorporate voluntary community-based flood insurance options into 
the national flood insurance program and for a strategy to implement 
such options that would encourage communities to undertake flood 
mitigation activities.

            Passed the House of Representatives May 17, 2012.

            Attest:

                                                                 Clerk.
112th CONGRESS

  2d Session

                               H. R. 5740

_______________________________________________________________________

                                 AN ACT

To extend the National Flood Insurance Program, and for other purposes.