[Congressional Bills 115th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1422 Reported in House (RH)]

<DOC>





                                                 Union Calendar No. 155
115th CONGRESS
  1st Session
                                H. R. 1422

                          [Report No. 115-220]

  To amend the Flood Disaster Protection Act of 1973 to require that 
certain buildings and personal property be covered by flood insurance, 
                        and for other purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             March 8, 2017

    Mr. Ross (for himself and Ms. Castor of Florida) introduced the 
   following bill; which was referred to the Committee on Financial 
                                Services

                             July 14, 2017

 Additional sponsors: Mr. Hollingsworth, Mr. Mooney of West Virginia, 
Mr. Posey, Mr. Loudermilk, Mr. Palazzo, Mr. Kind, Mr. Thomas J. Rooney 
 of Florida, Mr. Hastings, Mr. Rokita, Mr. Diaz-Balart, Mr. Bilirakis, 
Mr. Budd, Mr. Fitzpatrick, Mr. Coffman, Mrs. Demings, Mr. Luetkemeyer, 
    Mr. Smith of Missouri, Mr. Himes, Mr. Williams, and Mr. Renacci

                             July 14, 2017

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]
 [For text of introduced bill, see copy of bill as introduced on March 
                                8, 2017]


_______________________________________________________________________

                                 A BILL


 
  To amend the Flood Disaster Protection Act of 1973 to require that 
certain buildings and personal property be covered by flood insurance, 
                        and for other purposes.


 


SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Private Flood Insurance Market 
Development Act of 2017''.

SEC. 2. PRIVATE FLOOD INSURANCE.

    (a) Mandatory Purchase Requirement.--
            (1) Amount and term of coverage.--Section 102 of the Flood 
        Disaster Protection Act of 1973 (42 U.S.C. 4012a) is amended by 
        striking ``Sec. 102. (a)'' and all that follows through the end 
        of subsection (a) and inserting the following:
    ``Sec. 102. (a) Amount and Term of Coverage.--After the expiration 
of sixty days following the date of the enactment of this Act, no 
Federal officer or agency shall approve any financial assistance for 
acquisition or construction purposes for use in any area that has been 
identified by the Administrator as an area having special flood hazards 
and in which the sale of flood insurance has been made available under 
the National Flood Insurance Act of 1968, unless the building or mobile 
home and any personal property to which such financial assistance 
relates is covered by flood insurance: Provided, That the amount of 
flood insurance (1) in the case of Federal flood insurance, is at least 
equal to the development or project cost of the building, mobile home, 
or personal property (less estimated land cost), the outstanding 
principal balance of the loan, or the maximum limit of Federal flood 
insurance coverage made available with respect to the particular type 
of property, whichever is less; or (2) in the case of private flood 
insurance, is at least equal to the development or project cost of the 
building, mobile home, or personal property (less estimated land cost), 
the outstanding principal balance of the loan, or the maximum limit of 
Federal flood insurance coverage made available with respect to the 
particular type of property, whichever is less: Provided further, That 
if the financial assistance provided is in the form of a loan or an 
insurance or guaranty of a loan, the amount of flood insurance required 
need not exceed the outstanding principal balance of the loan and need 
not be required beyond the term of the loan. The requirement of 
maintaining flood insurance shall apply during the life of the 
property, regardless of transfer of ownership of such property.''.
            (2) Requirement for mortgage loans.--Subsection (b) of 
        section 102 of the Flood Disaster Protection Act of 1973 (42 
        U.S.C. 4012a(b)) is amended--
                    (A) by striking paragraph (7);
                    (B) by redesignating paragraph (6) as paragraph 
                (7);
                    (C) by striking the subsection designation and all 
                that follows through the end of paragraph (5) and 
                inserting the following:
    ``(b) Requirement for Mortgage Loans.--
            ``(1) Regulated lending institutions.--Each Federal entity 
        for lending regulation (after consultation and coordination 
        with the Financial Institutions Examination Council established 
        under the Federal Financial Institutions Examination Council 
        Act of 1974) shall by regulation direct regulated lending 
        institutions not to make, increase, extend, or renew any loan 
        secured by improved real estate or a mobile home located or to 
        be located in an area that has been identified by the 
        Administrator as an area having special flood hazards and in 
        which flood insurance has been made available under the 
        National Flood Insurance Act of 1968, unless the building or 
        mobile home and any personal property securing such loan is 
        covered for the term of the loan by flood insurance: Provided, 
        That the amount of flood insurance (A) in the case of Federal 
        flood insurance, is at least equal to the outstanding principal 
        balance of the loan or the maximum limit of Federal flood 
        insurance coverage made available with respect to the 
        particular type of property, whichever is less; or (B) in the 
        case of private flood insurance, is at least equal to the 
        outstanding principal balance of the loan or the maximum limit 
        of Federal flood insurance coverage made available with respect 
        to the particular type of property, whichever is less.
            ``(2) Federal agency lenders and mortgage insurance and 
        guarantee agencies.--
                    ``(A) Federal agency lenders.--A Federal agency 
                lender may not make, increase, extend, or renew any 
                loan secured by improved real estate or a mobile home 
                located or to be located in an area that has been 
                identified by the Administrator as an area having 
                special flood hazards and in which flood insurance has 
                been made available under the National Flood Insurance 
                Act of 1968, unless the building or mobile home and any 
                personal property securing such loan is covered for the 
                term of the loan by flood insurance in accordance with 
                paragraph (1). Each Federal agency lender may issue any 
                regulations necessary to carry out this paragraph. Such 
                regulations shall be consistent with and substantially 
                identical to the regulations issued under paragraph 
                (1).
                    ``(B) Other federal mortgage entities.--
                            ``(i) Coverage requirements.--Each covered 
                        Federal mortgage entity shall implement 
                        procedures reasonably designed to ensure that, 
                        for any loan that--
                                    ``(I) is secured by improved real 
                                estate or a mobile home located in an 
                                area that has been identified, at the 
                                time of the origination of the loan or 
                                at any time during the term of the 
                                loan, by the Administrator as an area 
                                having special flood hazards and in 
                                which flood insurance is available 
                                under the National Flood Insurance Act 
                                of 1968, and
                                    ``(II) is made, insured, held, or 
                                guaranteed by such entity, or backs or 
                                on which is based any trust certificate 
                                or other security for which such entity 
                                guarantees the timely payment of 
                                principal and interest,
                        the building or mobile home and any personal 
                        property securing the loan is covered for the 
                        term of the loan by flood insurance in the 
                        amount provided in paragraph (1).
                            ``(ii) Definition.--For purposes of this 
                        subparagraph, the term `covered Federal 
                        mortgage entity' means--
                                    ``(I) the Secretary of Housing and 
                                Urban Development, with respect to 
                                mortgages insured under the National 
                                Housing Act;
                                    ``(II) the Secretary of 
                                Agriculture, with respect to loans 
                                made, insured, or guaranteed under 
                                title V of the Housing Act of 1949; and
                                    ``(III) the Government National 
                                Mortgage Association.
                    ``(C) Requirement to accept flood insurance.--Each 
                Federal agency lender and each covered Federal mortgage 
                entity shall accept flood insurance as satisfaction of 
                the flood insurance coverage requirement under 
                subparagraph (A) or (B), respectively, if the flood 
                insurance coverage meets the requirements for coverage 
                under such subparagraph and the requirements relating 
                to financial strength issued pursuant to paragraph (4).
            ``(3) Government-sponsored enterprises for housing.--The 
        Federal National Mortgage Association and the Federal Home Loan 
        Mortgage Corporation shall implement procedures reasonably 
        designed to ensure that, for any loan that is--
                    ``(A) secured by improved real estate or a mobile 
                home located in an area that has been identified, at 
                the time of the origination of the loan or at any time 
                during the term of the loan, by the Administrator as an 
                area having special flood hazards and in which flood 
                insurance is available under the National Flood 
                Insurance Act of 1968, and
                    ``(B) purchased or guaranteed by such entity,
        the building or mobile home and any personal property securing 
        the loan is covered for the term of the loan by flood insurance 
        in the amount provided in paragraph (1). The Federal National 
        Mortgage Association and the Federal Home Loan Mortgage 
        Corporation shall accept flood insurance as satisfaction of the 
        flood insurance coverage requirement under paragraph (1) if the 
        flood insurance coverage provided meets the requirements for 
        coverage under that paragraph and the requirements relating to 
        financial strength issued pursuant to paragraph (4).
            ``(4) Requirements regarding financial strength.--The 
        Director of the Federal Housing Finance Agency, in consultation 
        with the Federal National Mortgage Association, the Federal 
        Home Loan Mortgage Corporation, the Secretary of Housing and 
        Urban Development, the Government National Mortgage 
        Association, and the Secretary of Agriculture shall develop and 
        implement requirements relating to the financial strength of 
        private insurance companies from which such entities and 
        agencies will accept private flood insurance, provided that 
        such requirements shall not affect or conflict with any State 
        law, regulation, or procedure concerning the regulation of the 
        business of insurance.
            ``(5) Applicability.--
                    ``(A) Existing coverage.--Except as provided in 
                subparagraph (B), paragraph (1) shall apply on the date 
                of enactment of the Riegle Community Development and 
                Regulatory Improvement Act of 1994.
                    ``(B) New coverage.--Paragraphs (2) and (3) shall 
                apply only with respect to any loan made, increased, 
                extended, or renewed after the expiration of the 1-year 
                period beginning on the date of enactment of the Riegle 
                Community Development and Regulatory Improvement Act of 
                1994. Paragraph (1) shall apply with respect to any 
                loan made, increased, extended, or renewed by any 
                lender supervised by the Farm Credit Administration 
                only after the expiration of the period under this 
                subparagraph.
                    ``(C) Continued effect of regulations.--
                Notwithstanding any other provision of this subsection, 
                the regulations to carry out paragraph (1), as in 
                effect immediately before the date of enactment of the 
                Riegle Community Development and Regulatory Improvement 
                Act of 1994, shall continue to apply until the 
                regulations issued to carry out paragraph (1) as 
                amended by section 522(a) of such Act take effect.
            ``(6) Rule of construction.--Except as otherwise specified, 
        any reference to flood insurance in this section shall be 
        considered to include Federal flood insurance and private flood 
        insurance. Nothing in this subsection shall be construed to 
        supersede or limit the authority of a Federal entity for 
        lending regulation, the Federal Housing Finance Agency, a 
        Federal agency lender, a covered Federal mortgage entity (as 
        such term is defined in paragraph (2)(B)(ii)), the Federal 
        National Mortgage Association, or the Federal Home Loan 
        Mortgage Corporation to establish requirements relating to the 
        financial strength of private insurance companies from which 
        the entity or agency will accept private flood insurance, 
        provided that such requirements shall not affect or conflict 
        with any State law, regulation, or procedure concerning the 
        regulation of the business of insurance.''; and
                    (D) by adding at the end the following new 
                paragraphs:
            ``(8) Definitions.--In this section:
                    ``(A) Flood insurance.--The term `flood insurance' 
                means--
                            ``(i) Federal flood insurance; and
                            ``(ii) private flood insurance.
                    ``(B) Federal flood insurance.--The term `Federal 
                flood insurance' means an insurance policy made 
                available under the National Flood Insurance Act of 
                1968 (42 U.S.C. 4001 et seq.).
                    ``(C) Private flood insurance.--The term `private 
                flood insurance' means an insurance policy that--
                            ``(i) is issued by an insurance company 
                        that is--
                                    ``(I) licensed, admitted, or 
                                otherwise approved to engage in the 
                                business of insurance in the State in 
                                which the insured building is located, 
                                by the insurance regulator of that 
                                State; or
                                    ``(II) eligible as a nonadmitted 
                                insurer to provide insurance in the 
                                home State of the insured, in 
                                accordance with sections 521 through 
                                527 of the Dodd-Frank Wall Street 
                                Reform and Consumer Protection Act (15 
                                U.S.C. 8201 through 8206);
                            ``(ii) is issued by an insurance company 
                        that is not otherwise disapproved as a surplus 
                        lines insurer by the insurance regulator of the 
                        State in which the property to be insured is 
                        located; and
                            ``(iii) provides flood insurance coverage 
                        that complies with the laws and regulations of 
                        that State.
                    ``(D) State.--The term `State' means any State of 
                the United States, the District of Columbia, the 
                Commonwealth of Puerto Rico, Guam, the Northern Mariana 
                Islands, the Virgin Islands, and American Samoa.''.
    (b) Effect of Private Flood Insurance Coverage on Continuous 
Coverage Requirements.--Section 1308 of the National Flood Insurance 
Act of 1968 (42 U.S.C. 4015) is amended by adding at the end the 
following:
    ``(n) Effect of Private Flood Insurance Coverage on Continuous 
Coverage Requirements.--For purposes of applying any statutory, 
regulatory, or administrative continuous coverage requirement, 
including under section 1307(g)(1), the Administrator shall consider 
any period during which a property was continuously covered by private 
flood insurance (as defined in section 102(b)(8) of the Flood Disaster 
Protection Act of 1973 (42 U.S.C. 4012a(b)(8))) to be a period of 
continuous coverage.''.
                                                 Union Calendar No. 155

115th CONGRESS

  1st Session

                               H. R. 1422

                          [Report No. 115-220]

_______________________________________________________________________

                                 A BILL

  To amend the Flood Disaster Protection Act of 1973 to require that 
certain buildings and personal property be covered by flood insurance, 
                        and for other purposes.

_______________________________________________________________________

                             July 14, 2017

  Reported with an amendment, committed to the Committee of the Whole 
       House on the State of the Union, and ordered to be printed