[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3370 Engrossed in House (EH)]

113th CONGRESS
  2d Session
                                H. R. 3370

_______________________________________________________________________

                                 AN ACT


 
To delay the implementation of certain provisions of the Biggert-Waters 
      Flood Insurance Reform Act of 2012, 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 AND TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Homeowner Flood 
Insurance Affordability Act of 2014''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.
Sec. 2. Definitions.
Sec. 3. Repeal of certain rate increases.
Sec. 4. Restoration of grandfathered rates.
Sec. 5. Requirements regarding annual rate increases.
Sec. 6. Clarification of rates for properties newly mapped into areas 
                            with special flood hazards.
Sec. 7. Premiums and reports.
Sec. 8. Annual premium surcharge.
Sec. 9. Draft affordability framework.
Sec. 10. Risk transfer.
Sec. 11. Monthly installment payment for premiums.
Sec. 12. Optional high-deductible policies for residential properties.
Sec. 13. Exclusion of detached structures from mandatory purchase 
                            requirement.
Sec. 14. Accounting for flood mitigation activities in estimates of 
                            premium rates.
Sec. 15. Home improvement fairness.
Sec. 16. Affordability study and report.
Sec. 17. Flood insurance rate map certification.
Sec. 18. Funds to reimburse homeowners for successful map appeals.
Sec. 19. Flood protection systems.
Sec. 20. Quarterly reports regarding Reserve Fund ratio.
Sec. 21. Treatment of floodproofed residential basements.
Sec. 22. Exemption from fees for certain map change requests.
Sec. 23. Study of voluntary community-based flood insurance options.
Sec. 24. Designation of flood insurance advocate.
Sec. 25. Exceptions to escrow requirement for flood insurance payments.
Sec. 26. Flood mitigation methods for buildings.
Sec. 27. Mapping of non-structural flood mitigation features.
Sec. 28. Clear communications.
Sec. 29. Protection of small businesses, non-profits, houses of 
                            worship, and residences.
Sec. 30. Mapping.
Sec. 31. Disclosure.

SEC. 2. DEFINITIONS.

    For purposes of this title, the following definitions shall apply:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the Federal Emergency Management Agency.
            (2) National flood insurance program.--The term ``National 
        Flood Insurance Program'' means the program established under 
        the National Flood Insurance Act of 1968 (42 U.S.C. 4001 et 
        seq.).

SEC. 3. REPEAL OF CERTAIN RATE INCREASES.

    (a) Repeal.--
            (1) In general.--Section 1307(g) of the National Flood 
        Insurance Act of 1968 (42 U.S.C. 4014(g)) is amended--
                    (A) by striking paragraphs (1) and (2);
                    (B) in paragraph (3), by striking ``as a result of 
                the deliberate choice of the holder of such policy'' 
                and inserting ``, 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''; and
                    (C) by redesignating paragraphs (3) and (4) as 
                paragraphs (1) and (2), respectively.
            (2) Effective date.--The Administrator shall make available 
        such rate tables, as necessary to implement the amendments made 
        by paragraph (1) as if it were enacted as part of the Biggert-
        Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 
        126 Stat. 957).
            (3) Implementation, coordination, and guidance.--
                    (A) Facilitation of timely refunds.--To ensure the 
                participation of Write Your Own companies (as such term 
                is defined in section 100202(a) of the Biggert-Waters 
                Flood Insurance Reform Act of 2012 (42 U.S.C. 4004(a)), 
                the Administrator and the Federal Emergency Management 
                Agency shall consult with Write Your Own companies 
                throughout the development of guidance and rate tables 
                necessary to implement the provisions of and the 
                amendments made by this Act.
                    (B) Implementation and guidance.--The Administrator 
                shall issue final guidance and rate tables necessary to 
                implement the provisions of and the amendments made by 
                this Act not later than eight months following the date 
                of the enactment of this Act. Write Your Own companies, 
                in coordination with the Federal Emergency Management 
                Agency, shall have not less than six months but not 
                more than eight months following the issuance of such 
                final guidance and rate tables to implement the changes 
                required by such final guidance and rate tables.
            (4) Refund of excess premium charges collected.--The 
        Administrator shall refund directly to insureds any premiums 
        for flood insurance coverage under the National Flood Insurance 
        Program collected in excess of the rates required under the 
        provisions of and amendments made by this section. To allow for 
        necessary and appropriate implementation of such provisions and 
        amendments, any premium changes necessary to implement such 
        provisions and amendments, including any such premium refund 
        due to policy holders, which shall be paid directly by the 
        National Flood Insurance Program, shall not be charged or paid 
        to policyholders by the National Flood Insurance Program until 
        after the Administrator issues guidance and makes available 
        such rate tables to implement the provisions of and amendments 
        made by this Act.
    (b) Assumption of Policies at Existing Premium Rates.--The 
Administrator shall provide that the purchaser of a property that, as 
of the date of such purchase, is covered under an existing flood 
insurance policy under this title may assume such existing policy and 
coverage for the remainder of the term of the policy at the chargeable 
premium rates under such existing policy. Such rates shall continue 
with respect to such property until the implementation of subsection 
(a).

SEC. 4. RESTORATION OF GRANDFATHERED RATES.

    (a) In General.--Section 1308 of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4015) is amended--
            (1) by striking subsection (h); and
            (2) by redesignating subsection (i) as subsection (h).
    (b) Effective Date.--The amendments made by subsection (a) shall 
take effect as if enacted as part of the Biggert-Waters Flood Insurance 
Reform Act of 2012 (Public Law 112-141; 126 Stat. 957).

SEC. 5. REQUIREMENTS REGARDING ANNUAL RATE INCREASES.

    Section 1308(e) of the National Flood Insurance Act of 1968 (42 
U.S.C. 4015(e)) is amended--
            (1) in the matter preceding paragraph (1), by striking ``, 
        the chargeable risk premium rates for flood insurance under 
        this title for any properties'';
            (2) in paragraph (1), by inserting ``the chargeable risk 
        premium rates for flood insurance under this title for any 
        properties'' before ``within any'';
            (3) in paragraph (2), by inserting ``the chargeable risk 
        premium rates for flood insurance under this title for any 
        properties'' before ``described in'';
            (4) by redesignating paragraphs (1) and (2), as so amended, 
        as paragraphs (3) and (4), respectively; and
            (5) by inserting before paragraph (3), as so redesignated, 
        the following new paragraphs:
            ``(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;'';
            (6) in paragraph (3) (as so redesignated by paragraph (4) 
        of this section), by striking ``20 percent'' and inserting ``15 
        percent''; and
            (7) in paragraph (4) (as so redesignated) by paragraph (4) 
        of this section), by striking ``paragraph (1)'' and inserting 
        ``paragraph (3)''.

SEC. 6. CLARIFICATION OF RATES FOR PROPERTIES NEWLY MAPPED INTO AREAS 
              WITH SPECIAL FLOOD HAZARDS.

    Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new subsection:
    ``(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.''.

SEC. 7. PREMIUMS AND REPORTS.

    Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new subsection:
    ``(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.''.

SEC. 8. ANNUAL PREMIUM SURCHARGE.

    (a) Premium Surcharge.--Chapter I of the National Flood Insurance 
Act of 1968 (42 U.S.C. 4011 et seq.) is amended by inserting after 
section 1308 the following new section:

``SEC. 1308A. PREMIUM SURCHARGE.

    ``(a) Imposition and Collection.--The Administrator shall impose 
and collect an annual surcharge, in the amount provided in subsection 
(b), on all policies for flood insurance coverage under the National 
Flood Insurance Program that are newly issued or renewed after the date 
of the enactment of this section. Such surcharge shall be in addition 
to the surcharge under section 1304(b) and any other assessments and 
surcharges applied to such coverage.
    ``(b) Amount.--The amount of the surcharge under subsection (a) 
shall be--
            ``(1) $25, except as provided in paragraph (2); and
            ``(2) $250, in the case of a policy for any property that 
        is--
                    ``(A) a non-residential property; or
                    ``(B) a residential property that is not the 
                primary residence of an individual.
    ``(c) Termination.--Subsections (a) and (b) shall cease to apply on 
the date on which the chargeable risk premium rate for flood insurance 
under this title for each property covered by flood insurance under 
this title, other than properties for which premiums are calculated 
under subsection (e) or (f) of section 1307 or section 1336 of this Act 
(42 U.S.C. 4014, 4056) or under section 100230 of the Biggert-Waters 
Flood Insurance Reform Act of 2012 (42 U.S.C. 4014 note), is not less 
than the applicable estimated risk premium rate under section 
1307(a)(1) for such property.''.
    (b) Deposit in Reserve Fund.--Subsection (c) of section 1310A of 
the National Flood Insurance Act of 1968 (42 U.S.C. 4017a) is amended 
by adding at the end the following new paragraph:
            ``(4) Deposit of premium surcharges.--The Administrator 
        shall deposit in the Reserve Fund any surcharges collected 
        pursuant to section 1308A.''.

SEC. 9. DRAFT AFFORDABILITY FRAMEWORK.

    (a) In General.--The Administrator shall prepare a draft 
affordability framework that proposes to address, via programmatic and 
regulatory changes, the issues of affordability of flood insurance sold 
under the National Flood Insurance Program, including issues identified 
in the affordability study required under section 100236 of the Bigger-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 
Stat. 957).
    (b) Criteria.--In carrying out the requirements under subsection 
(a), the Administrator shall consider the following criteria:
            (1) Accurate communication to consumers of the flood risk 
        associated with their properties.
            (2) Targeted assistance to flood insurance policy holders 
        based on their financial ability to continue to participate in 
        the National Flood Insurance Program.
            (3) Individual or community actions to mitigate the risk of 
        flood or lower the cost of flood insurance.
            (4) The impact of increases in risk premium rates on 
        participation in the National Flood Insurance Program.
            (5) The impact flood insurance rate map updates have on the 
        affordability of flood insurance.
    (c) Deadline for Submission.--Not later than 18 months after the 
date on which the Administrator submits the affordability study 
referred to in subsection (a), the Administrator shall submit to the 
full Committee on Banking, Housing, and Urban Affairs and the full 
Committee on Appropriations of the Senate and the full Committee on 
Financial Services and the full Committee on Appropriations of the 
House of Representatives the draft affordability framework required 
under subsection (a).
    (d) Interagency Agreements.--The Administrator may enter into an 
agreement with another Federal agency to--
            (1) complete the affordability study referred to in 
        subsection (a); or
            (2) prepare the draft affordability framework required 
        under subsection (a).
    (e) Rule of Construction.--Nothing in this section shall be 
construed to provide the Administrator with the authority to provide 
assistance to homeowners based on affordability that was not available 
prior to the enactment of the Biggert-Waters Flood Insurance Reform Act 
of 2012 (Public Law 112-141; 126 Stat. 916).

SEC. 10. RISK TRANSFER.

    Section 1345 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4081) is amended by adding at the end the following new subsection:
    ``(e) Risk Transfer.--The Administrator may secure reinsurance of 
coverage provided by the flood insurance program from the private 
reinsurance and capital markets at rates and on terms determined by the 
Administrator to be reasonable and appropriate, in an amount sufficient 
to maintain the ability of the program to pay claims.''.

SEC. 11. MONTHLY INSTALLMENT PAYMENT FOR PREMIUMS.

    (a) In General.--Subsection (g) of section 1308 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4015(g)) is amended by striking 
``either annually or in more frequent installments'' and inserting 
``annually or monthly''.
    (b) Implementation.--The Administrator shall implement the 
requirement under section 1308(g) of the National Flood Insurance Act 
of 1968, as amended by subsection (a), not later than the expiration of 
the 18-month period beginning on the date of the enactment of this Act.

SEC. 12. OPTIONAL HIGH-DEDUCTIBLE POLICIES FOR RESIDENTIAL PROPERTIES.

    Section 1306 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4013)), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new subsection:
    ``(e) Optional High-Deductible Policies for Residential 
Properties.--
            ``(1) Availability.--In the case of residential properties, 
        the Administrator shall make flood insurance coverage 
        available, at the option of the insured, that provides for a 
        loss-deductible for damage to the covered property in various 
        amounts, up to and including $10,000.
            ``(2) Disclosure.--
                    ``(A) Form.--The Administrator shall provide the 
                information described in subparagraph (B) clearly and 
                conspicuously on the application form for flood 
                insurance coverage or on a separate form, segregated 
                from all unrelated information and other required 
                disclosures.
                    ``(B) Information.--The information described in 
                this subparagraph is--
                            ``(i) information sufficient to inform the 
                        applicant of the availability of the coverage 
                        option required by paragraph (1) to applicants 
                        for flood insurance coverage; and
                            ``(ii) a statement explaining the effect of 
                        a loss-deductible and that, in the event of an 
                        insured loss, the insured is responsible out-
                        of-pocket for losses to the extent of the 
                        deductible selected.''.

SEC. 13. EXCLUSION OF DETACHED STRUCTURES FROM MANDATORY PURCHASE 
              REQUIREMENT.

    (a) Exclusion.--Subsection (c) of section 102 of the Flood Disaster 
Protection Act of 1973 (42 U.S.C. 4012a(c)) is amended by adding at the 
end the following new paragraph:
            ``(3) Detached structures.--Notwithstanding any other 
        provision of this section, flood insurance shall not be 
        required, in the case of any residential property, for any 
        structure that is a part of such property but is detached from 
        the primary residential structure of such property and does not 
        serve as a residence.''.
    (b) RESPA Statement.--Section 5(b) of the Real Estate Settlement 
Procedures Act of 1974 (12 U.S.C. 2604(b)) is amended--
            (1) in paragraph (14), by inserting before the period at 
        the end the following: ``, and the following statement: 
        `Although you may not be required to maintain flood insurance 
        on all structures, you may still wish to do so, and your 
        mortgage lender may still require you to do so to protect the 
        collateral securing the mortgage. If you choose to not maintain 
        flood insurance on a structure, and it floods, you are 
        responsible for all flood losses relating to that 
        structure.'''; and
            (2) by transferring and inserting paragraph (14), as so 
        amended, after paragraph (13).

SEC. 14. ACCOUNTING FOR FLOOD MITIGATION ACTIVITIES IN ESTIMATES OF 
              PREMIUM RATES.

    Subparagraph (A) of section 1307(a)(1) of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4014(a)(1)(A)) is amended to read as 
follows:
                    ``(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,''.

SEC. 15. HOME IMPROVEMENT FAIRNESS.

    Section 1307(a)(2)(E)(ii) of the National Flood Insurance Act of 
1968 (42 U.S.C. 4014(a)(2)(E)(ii)) is amended by striking ``30 
percent'' and inserting ``50 percent''.

SEC. 16. AFFORDABILITY STUDY AND REPORT.

    (a) Study Issues.--Subsection (a) of section 100236 of the Biggert-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 
Stat. 957) is amended--
            (1) in paragraph (3), by striking ``and'' at the end;
            (2) in paragraph (4), by striking the period at the end and 
        inserting a semicolon; and
            (3) by adding at the end the following new paragraphs:
            ``(5) options for maintaining affordability if annual 
        premiums for flood insurance coverage were to increase to an 
        amount greater than 2 percent of the liability coverage amount 
        under the policy, including options for enhanced mitigation 
        assistance and means-tested assistance;
            ``(6) the effects that the establishment of catastrophe 
        savings accounts would have regarding long-term affordability 
        of flood insurance coverage; and
            ``(7) options for modifying the surcharge under 1308A, 
        including based on homeowner income, property value or risk of 
        loss.''.
    (b) Timing of Submission.--Notwithstanding the deadline under 
section 100236(c) of the Biggert-Waters Flood Insurance Reform Act of 
2012 (Public Law 112-141; 126 Stat. 957), not later than 18 months 
after the date of enactment of this Act, the Administrator shall submit 
to the full Committee on Banking, Housing, and Urban Affairs and the 
full Committee on Appropriations of the Senate and the full Committee 
on Financial Services and the full Committee on Appropriations of the 
House of Representatives the affordability study and report required 
under such section 100236.
    (c) Affordability Study Funding.--Section 100236(d) of the Biggert-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 
Stat. 957) is amended by striking ``$750,000'' and inserting 
``$2,500,000''.

SEC. 17. FLOOD INSURANCE RATE MAP CERTIFICATION.

    The Administrator shall implement a flood mapping program for the 
National Flood Insurance Program, only after review by the Technical 
Mapping Advisory Council, that, when applied, results in technically 
credible flood hazard data in all areas where Flood Insurance Rate Maps 
are prepared or updated, shall certify in writing to the Congress when 
such a program has been implemented, and shall provide to the Congress 
the Technical Mapping Advisory Council review report.

SEC. 18. FUNDS TO REIMBURSE HOMEOWNERS FOR SUCCESSFUL MAP APPEALS.

    (a) In General.--Section 1363(f) of the National Flood Insurance 
Act of 1968 (42 U.S.C. 4104(f)) is amended--
            (1) in the first sentence, by inserting after ``as the case 
        may be,'' the following: ``or, in the case of an appeal that is 
        resolved by submission of conflicting data to the Scientific 
        Resolution Panel provided for in section 1363A, the 
        community,''; and
            (2) by striking the second sentence and inserting the 
        following: ``The Administrator may use such amounts from the 
        National Flood Insurance Fund established under section 1310 as 
        may be necessary to carry out this subsection.''.
    (b) Conforming Amendments.--Section 1310(a) of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4017(a)) is amended--
            (1) in paragraph (6), by striking ``and'' at the end;
            (2) in paragraph (7), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(8) for carrying out section 1363(f).''.

SEC. 19. FLOOD PROTECTION SYSTEMS.

    (a) Adequate Progress on Construction of Flood Protection 
Systems.--Section 1307(e) of the National Flood Insurance Act of 1968 
(42 U.S.C. 4014(e)) is amended--
            (1) in the first sentence, by inserting ``or 
        reconstruction'' after ``construction'';
            (2) by amending the second sentence to read as follows: 
        ``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.''; and
            (3) by adding at the end the following: ``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.''.
    (b) Communities Restoring Disaccredited Flood Protection Systems.--
Section 1307(f) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4014(f)) is amended by amending the first sentence to read as follows: 
``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.''.

SEC. 20. QUARTERLY REPORTS REGARDING RESERVE FUND RATIO.

    Subsection (e) of section 1310A of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4017a) is amended, in the matter preceding paragraph 
(1), by inserting ``, on a calendar quarterly basis,'' after 
``submit''.

SEC. 21. TREATMENT OF FLOODPROOFED RESIDENTIAL BASEMENTS.

    The Administrator shall continue to extend exceptions and variances 
for flood-proofed basements consistent with section 60.6 of title 44, 
Code of Federal Regulations, which are effective April 3, 2009; and 
section 60.3 of such title, which are effective April 3, 2009.

SEC. 22. EXEMPTION FROM FEES FOR CERTAIN MAP CHANGE REQUESTS.

    Notwithstanding any other provision of law, a requester shall be 
exempt from submitting a review or processing fee for a request for a 
flood insurance rate map change based on a habitat restoration project 
that is funded in whole or in part with Federal or State funds, 
including dam removal, culvert redesign or installation, or the 
installation of fish passage.

SEC. 23. STUDY OF VOLUNTARY COMMUNITY-BASED FLOOD INSURANCE OPTIONS.

    (a) Study.--
            (1) Study required.--The Administrator shall conduct a 
        study to assess options, methods, and strategies for making 
        available voluntary community-based flood insurance policies 
        through the National Flood Insurance Program.
            (2) Considerations.--The study conducted under paragraph 
        (1) shall--
                    (A) take into consideration and analyze how 
                voluntary community-based flood insurance policies--
                            (i) would affect communities having varying 
                        economic bases, geographic locations, flood 
                        hazard characteristics or classifications, and 
                        flood management approaches; and
                            (ii) could satisfy the applicable 
                        requirements under section 102 of the Flood 
                        Disaster Protection Act of 1973 (42 U.S.C. 
                        4012a); and
                    (B) evaluate the advisability of making available 
                voluntary community-based flood insurance policies to 
                communities, subdivisions of communities, and areas of 
                residual risk.
            (3) Consultation.--In conducting the study required under 
        paragraph (1), the Administrator may consult with the 
        Comptroller General of the United States, as the Administrator 
        determines is appropriate.
    (b) Report by the Administrator.--
            (1) Report required.--Not later than 18 months after the 
        date of enactment of this Act, the Administrator shall submit 
        to the Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Financial Services of the House of 
        Representatives a report that contains the results and 
        conclusions of the study conducted under subsection (a).
            (2) Contents.--The report submitted under paragraph (1) 
        shall include recommendations for--
                    (A) the best manner to incorporate voluntary 
                community-based flood insurance policies into the 
                National Flood Insurance Program; and
                    (B) a strategy to implement voluntary community-
                based flood insurance policies that would encourage 
                communities to undertake flood mitigation activities, 
                including the construction, reconstruction, or 
                improvement of levees, dams, or other flood control 
                structures.
    (c) Report by Comptroller General.--Not later than 6 months after 
the date on which the Administrator submits the report required under 
subsection (b), the Comptroller General of the United States shall--
            (1) review the report submitted by the Administrator; and
            (2) submit to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Financial Services 
        of the House of Representatives a report that contains--
                    (A) an analysis of the report submitted by the 
                Administrator;
                    (B) any comments or recommendations of the 
                Comptroller General relating to the report submitted by 
                the Administrator; and
                    (C) any other recommendations of the Comptroller 
                General relating to community-based flood insurance 
                policies.

SEC. 24. DESIGNATION OF FLOOD INSURANCE ADVOCATE.

    (a) In General.--The Administrator shall designate a Flood 
Insurance Advocate to advocate for the fair treatment of policy holders 
under the National Flood Insurance Program and property owners in the 
mapping of flood hazards, the identification of risks from flood, and 
the implementation of measures to minimize the risk of flood.
    (b) Duties and Responsibilities.--The duties and responsibilities 
of the Flood Insurance Advocate designated under subsection (a) shall 
be to--
            (1) educate property owners and policyholders under the 
        National Flood Insurance Program on--
                    (A) individual flood risks;
                    (B) flood mitigation;
                    (C) measures to reduce flood insurance rates 
                through effective mitigation;
                    (D) the flood insurance rate map review and 
                amendment process; and
                    (E) any changes in the flood insurance program as a 
                result of any newly enacted laws (including this Act);
            (2) assist policy holders under the National Flood 
        Insurance Program and property owners to understand the 
        procedural requirements related to appealing preliminary flood 
        insurance rate maps and implementing measures to mitigate 
        evolving flood risks;
            (3) assist in the development of regional capacity to 
        respond to individual constituent concerns about flood 
        insurance rate map amendments and revisions;
            (4) coordinate outreach and education with local officials 
        and community leaders in areas impacted by proposed flood 
        insurance rate map amendments and revisions; and
            (5) aid potential policy holders under the National Flood 
        Insurance Program in obtaining and verifying accurate and 
        reliable flood insurance rate information when purchasing or 
        renewing a flood insurance policy.

SEC. 25. EXCEPTIONS TO ESCROW REQUIREMENT FOR FLOOD INSURANCE PAYMENTS.

    (a) In General.--Section 102(d)(1) of the Flood Disaster Protection 
Act of 1973 (42 U.S.C. 4012a(d)(1)) is amended--
            (1) in subparagraph (A), in the second sentence, by 
        striking ``subparagraph (C)'' and inserting ``subparagraph 
        (B)''; and
            (2) in subparagraph (B)--
                    (A) in clause (ii), by redesignating subclauses (I) 
                and (II) as items (aa) and (bb), respectively, and 
                adjusting the margins accordingly;
                    (B) by redesignating clauses (i) and (ii) as 
                subclauses (I) and (II), respectively, and adjusting 
                the margins accordingly;
                    (C) in the matter preceding subclause (I), as 
                redesignated by subparagraph (B), by striking ``(A) or 
                (B), if--'' and inserting the following: ``(A)--
                            ``(i) if--'';
                    (D) by striking the period at the end and inserting 
                ``; or''; and
                    (E) by adding at the end the following
                            ``(ii) in the case of a loan that--
                                    ``(I) is in a junior or subordinate 
                                position to a senior lien secured by 
                                the same residential improved real 
                                estate or mobile home for which flood 
                                insurance is being provided at the time 
                                of the origination of the loan;
                                    ``(II) is secured by residential 
                                improved real estate or a mobile home 
                                that is part of a condominium, 
                                cooperative, or other project 
                                development, if the residential 
                                improved real estate or mobile home is 
                                covered by a flood insurance policy 
                                that--
                                            ``(aa) meets the 
                                        requirements that the regulated 
                                        lending institution is required 
                                        to enforce under subsection 
                                        (b)(1);
                                            ``(bb) is provided by the 
                                        condominium association, 
                                        cooperative, homeowners 
                                        association, or other 
                                        applicable group; and
                                            ``(cc) the premium for 
                                        which is paid by the 
                                        condominium association, 
                                        cooperative, homeowners 
                                        association, or other 
                                        applicable group as a common 
                                        expense;
                                    ``(III) is secured by residential 
                                improved real estate or a mobile home 
                                that is used as collateral for a 
                                business purpose;
                                    ``(IV) is a home equity line of 
                                credit;
                                    ``(V) is a nonperforming loan; or
                                    ``(VI) has a term of not longer 
                                than 12 months.''.
    (b) Applicability.--
            (1) In general.--
                    (A) Required application.--The amendments to 
                section 102(d)(1) of the Flood Disaster Protection Act 
                of 1973 (42 U.S.C. 4012a(d)(1)) made by section 
                100209(a) of the Biggert-Waters Flood Insurance Reform 
                Act of 2012 (Public Law 112-141; 126 Stat. 920) and by 
                subsection (a) of this section shall apply to any loan 
                that is originated, refinanced, increased, extended, or 
                renewed on or after January 1, 2016.
                    (B) Optional application.--
                            (i) Definitions.--In this subparagraph--
                                    (I) the terms ``Federal entity for 
                                lending regulation'', ``improved real 
                                estate'', ``regulated lending 
                                institution'', and ``servicer'' have 
                                the meanings given the terms in section 
                                3 of the Flood Disaster Protection Act 
                                of 1973 (42 U.S.C. 4003);
                                    (II) the term ``outstanding loan'' 
                                means a loan that--
                                            (aa) is outstanding as of 
                                        January 1, 2016;
                                            (bb) is not subject to the 
                                        requirement to escrow premiums 
                                        and fees for flood insurance 
                                        under section 102(d)(1) of the 
                                        Flood Disaster Protection Act 
                                        of 1973 (42 U.S.C. 4012a(d)(1)) 
                                        as in effect on July 5, 2012; 
                                        and
                                            (cc) would, if the loan had 
                                        been originated, refinanced, 
                                        increased, extended, or renewed 
                                        on or after January 1, 2016, be 
                                        subject to the requirements 
                                        under section 102(d)(1)(A) of 
                                        the Flood Disaster Protection 
                                        Act of 1973, as amended; and
                                    (III) the term ``section 
                                102(d)(1)(A) of the Flood Disaster 
                                Protection Act of 1973, as amended'' 
                                means section 102(d)(1)(A) of the Flood 
                                Disaster Protection Act of 1973 (42 
                                U.S.C. 4012a(d)(1)(A)), as amended by--
                                            (aa) section 100209(a) of 
                                        the Biggert-Waters Flood 
                                        Insurance Reform Act of 2012 
                                        (Public Law 112-141; 126 Stat. 
                                        920); and
                                            (bb) subsection (a) of this 
                                        section.
                            (ii) Option to escrow flood insurance 
                        payments.--Each Federal entity for lending 
                        regulation (after consultation and coordination 
                        with the Federal Financial Institutions 
                        Examination Council) shall, by regulation, 
                        direct that each regulated lending institution 
                        or servicer of an outstanding loan shall offer 
                        and make available to a borrower the option to 
                        have the borrower's payment of premiums and 
                        fees for flood insurance under the National 
                        Flood Insurance Act of 1968 (42 U.S.C. 4001 et 
                        seq.), including the escrow of such payments, 
                        be treated in the same manner provided under 
                        section 102(d)(1)(A) of the Flood Disaster 
                        Protection Act of 1973, as amended.
            (2) Repeal of 2-year delay on applicability.--Subsection 
        (b) of section 100209 of the Biggert-Waters Flood Insurance 
        Reform Act of 2012 (Public Law 112-141; 126 Stat. 920) is 
        repealed.
            (3) Rule of construction.--Nothing in this section or the 
        amendments made by this section shall be construed to 
        supersede, during the period beginning on July 6, 2012 and 
        ending on December 31, 2015, the requirements under section 
        102(d)(1) of the Flood Disaster Protection Act of 1973 (42 
        U.S.C. 4012a(d)(1)), as in effect on July 5, 2012.

SEC. 26. FLOOD MITIGATION METHODS FOR BUILDINGS.

    (a) Guidelines.--
            (1) 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:
    ``(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.''.
            (2) Issuance.--The Administrator shall issue the guidelines 
        required under section 1361(d) of the National Flood Insurance 
        Act of 1968 (42 U.S.C. 4102(d)), as added by the amendment made 
        by paragraph (1) of this subsection, not later than the 
        expiration of the 1-year period beginning on the date of the 
        enactment of this Act.
    (b) Calculation of Risk Premium Rates.--Section 1308 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4015), as amended by 
the preceding provisions of this Act, is further amended by adding at 
the end the following new subsection:
    ``(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)).''.

SEC. 27. MAPPING OF NON-STRUCTURAL FLOOD MITIGATION FEATURES.

     Section 100216 of the Biggert-Waters Flood Insurance Reform Act of 
2012 (42 U.S.C. 4101b) is amended--
            (1) in subsection (b)(1)(A)--
                    (A) in clause (iv), by striking ``and'' at the end;
                    (B) by redesignating clause (v) as clause (vi);
                    (C) by inserting after clause (iv) the following 
                new clause:
                            ``(v) areas that are protected by non-
                        structural flood mitigation features; and''; 
                        and
                    (D) in clause (vi) (as so redesignated), by 
                inserting before the semicolon at the end the 
                following: ``and by non-structural flood mitigation 
                features''; and
            (2) in subsection (d)(1)--
                    (A) by redesignating subparagraphs (A) through (C) 
                as subparagraphs (B) through (D), respectively;
                    (B) in subparagraph (C) (as so redesignated), by 
                striking ``subparagraph (A)'' and inserting 
                ``subparagraph (B)''; and
                    (C) by inserting before subparagraph (B) (as so 
                redesignated) the following new subparagraph:
                    ``(A) work with States, local communities, and 
                property owners to identify areas and features 
                described in subsection (b)(1)(A)(v);''.

SEC. 28. CLEAR COMMUNICATIONS.

    Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new subsection:
    ``(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.''.

SEC. 29. PROTECTION OF SMALL BUSINESSES, NON-PROFITS, HOUSES OF 
              WORSHIP, AND RESIDENCES.

    Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following new subsection:
    ``(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 Representatives and the Committee on Banking, 
        Housing, and Urban Affairs of the Senate.''.

SEC. 30. MAPPING.

    Section 100216(d)(1) of the Biggert-Waters Flood Insurance Reform 
Act of 2012 (42 U.S.C. 4101b(d)(1)) is amended--
            (1) in subparagraph (B)--
                    (A) by striking ``subparagraph (A)'' and inserting 
                ``subparagraph (D)''; and
                    (B) by striking ``and'' at the end;
            (2) by redesignating subparagraphs (A), (B), and (C) as 
        subparagraphs (D), (E), and (G), respectively;
            (3) by inserting before subparagraph (B), as so 
        redesignated, the following new subparagraphs:
                    ``(A) before commencement of any mapping or map 
                updating process, notify each community affected of the 
                model or models that the Administrator plans to use in 
                such process and provide an explanation of why such 
                model or models are appropriate;
                    ``(B) provide each community affected a 30-day 
                period beginning upon notification under subparagraph 
                (A) to consult with the Administrator regarding the 
                appropriateness, with respect to such community, of the 
                mapping model or models to be used; provided that 
                consultation by a community pursuant to this 
                subparagraph shall not waive or otherwise affect any 
                right of the community to appeal any flood hazard 
                determinations;
                    ``(C) upon completion of the first Independent Data 
                Submission, transmit a copy of such Submission to the 
                affected community, provide the affected community a 
                30-day period during which the community may provide 
                data to Administrator that can be used to supplement or 
                modify the existing data, and incorporate any data that 
                is consistent with prevailing engineering 
                principles;''; and
            (4) by inserting after subparagraph (E), as so 
        redesignated, the following new subparagraph:
                    ``(F) not less than 30 days before issuance of any 
                preliminary map, notify the Senators for each State 
                affected and each Member of the House of 
                Representatives for each congressional district 
                affected by the preliminary map in writing of--
                            ``(i) the estimated schedule for--
                                    ``(I) community meetings regarding 
                                the preliminary map;
                                    ``(II) publication of notices 
                                regarding the preliminary map in local 
                                newspapers; and
                                    ``(III) the commencement of the 
                                appeals process regarding the map; and
                            ``(ii) the estimated number of homes and 
                        businesses that will be affected by changes 
                        contained in the preliminary map, including how 
                        many structures will be that were not 
                        previously located in an area having special 
                        flood hazards will be located within such an 
                        area under the preliminary map; and''.

SEC. 31. DISCLOSURE.

    (a) Changes in Rates Resulting From This Act.--Not later than the 
date that is 6 months before the date on which any change in risk 
premium rates for flood insurance coverage under the National Flood 
Insurance Program resulting from this Act or any amendment made by this 
Act is implemented, the Administrator shall make publicly available the 
rate tables and underwriting guidelines that provide the basis for the 
change.
    (b) Report on Policy and Claims Data.--
            (1) In general.--Not later than 90 days after the date of 
        enactment of this Act, the Administrator shall submit to the 
        Congress a report on the feasibility of--
                    (A) releasing property-level policy and claims data 
                for flood insurance coverage under the National Flood 
                Insurance Program; and
                    (B) establishing guidelines for releasing property-
                level policy and claims data for flood insurance 
                coverage under the National Flood Insurance Program in 
                accordance with section 552a of title 5, United States 
                Code (commonly known as the Privacy Act of 1974).
            (2) Contents.--The report submitted under paragraph (1) 
        shall include--
                    (A) an analysis and assessment of how releasing 
                property-level policy and claims data for flood 
                insurance coverage under the National Flood Insurance 
                Program will aid policy holders and insurers to 
                understand how the Administration determines actuarial 
                premium rates and assesses flood risks; and
                    (B) recommendations for protecting personal 
                information in accordance with section 552a of title 5, 
                United States Code (commonly known as the Privacy Act 
                of 1974).

            Passed the House of Representatives March 4, 2014.

            Attest:

                                                                 Clerk.
113th CONGRESS

  2d Session

                               H. R. 3370

_______________________________________________________________________

                                 AN ACT

To delay the implementation of certain provisions of the Biggert-Waters 
      Flood Insurance Reform Act of 2012, and for other purposes.