[Title 44 CFR ]
[Code of Federal Regulations (annual edition) - October 1, 1997 Edition]
[From the U.S. Government Publishing Office]


[[Page 1]]

          44



          Emergency Management and Assistance




                         Revised as of October 1, 1997

          CONTAINING
          A CODIFICATION OF DOCUMENTS
          OF GENERAL APPLICABILITY
          AND FUTURE EFFECT
          AS OF OCTOBER 1, 1997

          With Ancillaries
          Published by
          the Office of the Federal Register
          National Archives and Records
          Administration
          as a Special Edition of
          the Federal Register




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                     U.S. GOVERNMENT PRINTING OFFICE
                            WASHINGTON : 1997



               For sale by U.S. Government Printing Office
 Superintendent of Documents, Mail Stop: SSOP, Washington, DC 20402-9328



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                            Table of Contents



                                                                    Page
  Explanation.................................................       v

  Title 44:
    Chapter I--Federal Emergency Management Agency............       3
    Chapter IV--Department of Commerce and Department of 
        Transportation........................................     627
  Finding Aids:
    Table of CFR Titles and Chapters..........................     635
    Alphabetical List of Agencies Appearing in the CFR........     651
    List of CFR Sections Affected.............................     661



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----------------------------------------------------------

   Cite this Code:  CFR

   To cite the regulations in this volume use title, part
   and section number. Thus,  44 CFR 1.1 refers to title
   44, part 1, section 1.

----------------------------------------------------------


[[Page v]]



                               EXPLANATION

    The Code of Federal Regulations is a codification of the general and 
permanent rules published in the Federal Register by the Executive 
departments and agencies of the Federal Government. The Code is divided 
into 50 titles which represent broad areas subject to Federal 
regulation. Each title is divided into chapters which usually bear the 
name of the issuing agency. Each chapter is further subdivided into 
parts covering specific regulatory areas.
    Each volume of the Code is revised at least once each calendar year 
and issued on a quarterly basis approximately as follows:

Title 1 through Title 16.................................as of January 1
Title 17 through Title 27..................................as of April 1
Title 28 through Title 41...................................as of July 1
Title 42 through Title 50................................as of October 1
    The appropriate revision date is printed on the cover of each 
volume.

LEGAL STATUS

    The contents of the Federal Register are required to be judicially 
noticed (44 U.S.C. 1507). The Code of Federal Regulations is prima facie 
evidence of the text of the original documents (44 U.S.C. 1510).

HOW TO USE THE CODE OF FEDERAL REGULATIONS

    The Code of Federal Regulations is kept up to date by the individual 
issues of the Federal Register. These two publications must be used 
together to determine the latest version of any given rule.
    To determine whether a Code volume has been amended since its 
revision date (in this case, October 1, 1997), consult the ``List of CFR 
Sections Affected (LSA),'' which is issued monthly, and the ``Cumulative 
List of Parts Affected,'' which appears in the Reader Aids section of 
the daily Federal Register. These two lists will identify the Federal 
Register page number of the latest amendment of any given rule.

EFFECTIVE AND EXPIRATION DATES

    Each volume of the Code contains amendments published in the Federal 
Register since the last revision of that volume of the Code. Source 
citations for the regulations are referred to by volume number and page 
number of the Federal Register and date of publication. Publication 
dates and effective dates are usually not the same and care must be 
exercised by the user in determining the actual effective date. In 
instances where the effective date is beyond the cut-off date for the 
Code a note has been inserted to reflect the future effective date. In 
those instances where a regulation published in the Federal Register 
states a date certain for expiration, an appropriate note will be 
inserted following the text.

OMB CONTROL NUMBERS

    The Paperwork Reduction Act of 1980 (Pub. L. 96-511) requires 
Federal agencies to display an OMB control number with their information 
collection request.

[[Page vi]]

Many agencies have begun publishing numerous OMB control numbers as 
amendments to existing regulations in the CFR. These OMB numbers are 
placed as close as possible to the applicable recordkeeping or reporting 
requirements.

OBSOLETE PROVISIONS

    Provisions that become obsolete before the revision date stated on 
the cover of each volume are not carried. Code users may find the text 
of provisions in effect on a given date in the past by using the 
appropriate numerical list of sections affected. For the period before 
January 1, 1986, consult either the List of CFR Sections Affected, 1949-
1963, 1964-1972, or 1973-1985, published in seven separate volumes. For 
the period beginning January 1, 1986, a ``List of CFR Sections 
Affected'' is published at the end of each CFR volume.

CFR INDEXES AND TABULAR GUIDES

    A subject index to the Code of Federal Regulations is contained in a 
separate volume, revised annually as of January 1, entitled CFR Index 
and Finding Aids. This volume contains the Parallel Table of Statutory 
Authorities and Agency Rules (Table I), and Acts Requiring Publication 
in the Federal Register (Table II). A list of CFR titles, chapters, and 
parts and an alphabetical list of agencies publishing in the CFR are 
also included in this volume.
    An index to the text of ``Title 3--The President'' is carried within 
that volume.
    The Federal Register Index is issued monthly in cumulative form. 
This index is based on a consolidation of the ``Contents'' entries in 
the daily Federal Register.
    A List of CFR Sections Affected (LSA) is published monthly, keyed to 
the revision dates of the 50 CFR titles.

REPUBLICATION OF MATERIAL

    There are no restrictions on the republication of material appearing 
in the Code of Federal Regulations.

INQUIRIES

    For a legal interpretation or explanation of any regulation in this 
volume, contact the issuing agency. The issuing agency's name appears at 
the top of odd-numbered pages.
    For inquiries concerning CFR reference assistance, call 202-523-5227 
or write to the Director, Office of the Federal Register, National 
Archives and Records Administration, Washington, DC 20408.

SALES

    The Government Printing Office (GPO) processes all sales and 
distribution of the CFR. For payment by credit card, call 202-512-1800, 
M-F 8 a.m. to 4 p.m. e.s.t. or fax your order to 202-512-2233, 24 hours 
a day. For payment by check, write to the Superintendent of Documents, 
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Customer Service call 202-512-1803.

                              Raymond A. Mosley,
                                    Director,
                          Office of the Federal Register.

October 1, 1997.



[[Page vii]]



                               THIS TITLE

    Title 44--Emergency Management and Assistance is composed of one 
volume. The contents of this volume represent all current regulations 
codified under this title of the CFR as of October 1, 1997.

    For this volume, Kenneth R. Payne was Chief Editor. The Code of 
Federal Regulations publication program is under the direction of 
Frances D. McDonald, assisted by Alomha S. Morris.

[[Page viii]]




[[Page 1]]



              TITLE 44--EMERGENCY MANAGEMENT AND ASSISTANCE




  --------------------------------------------------------------------
                                                                    Part

Chapter i-- Federal Emergency Management Agency.............           1

Chapter iv-- Department of Commerce and Department of 
  Transportation............................................         401

[[Page 3]]



             CHAPTER I--FEDERAL EMERGENCY MANAGEMENT AGENCY




  --------------------------------------------------------------------


                          SUBCHAPTER A--GENERAL
Part                                                                Page
0

General statements of policy [Reserved]

1               Rulemaking; policy and procedures...........           7
2               Organization, functions, and delegations of 
                    authority...............................          13
3

[Reserved]

4               Intergovernmental review of Federal 
                    Emergency Management Agency (FEMA) 
                    programs and activities.................          26
5               Production or disclosure of information.....          30
6               Implementation of the Privacy Act of 1974...          46
7               Nondiscrimination in federally-assisted 
                    programs (FEMA Reg. 5)..................          64
8               National security information...............          79
9               Floodplain management and protection of 
                    wetlands................................          81
10              Environmental considerations................         101
11              Claims......................................         111
12              Advisory committees.........................         138
13              Uniform administrative requirements for 
                    grants and cooperative agreements to 
                    State and local governments.............         145
14              Administration of grants: Audits of State 
                    and local governments...................         172
15              Conduct at the FEMA Special Facility........         178
16              Enforcement of nondiscrimination on the 
                    basis of handicap in programs or 
                    activities conducted by the Federal 
                    Emergency Management Agency.............         183
17              Governmentwide debarment and suspension 
                    (nonprocurement) and governmentwide 
                    requirements for drug-free workplace 
                    (grants)................................         189
18              New restrictions on lobbying................         208
19-24

[Reserved]

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25              Uniform relocation assistance and real 
                    property acquisition for Federal and 
                    federally assisted programs.............         219
26-49

[Reserved]

              SUBCHAPTER B--INSURANCE AND HAZARD MITIGATION
50-54

[Reserved]

                 NATIONAL INSURANCE DEVELOPMENT PROGRAM
55-58

[Reserved]

                    NATIONAL FLOOD INSURANCE PROGRAM
59              General provisions..........................         220
60              Criteria for land management and use........         234
61              Insurance coverage and rates................         249
62              Sale of insurance and adjustment of claims..         299
63              Implementation of section 1306(c) of the 
                    National Flood Insurance Act of 1968....         321
64              Communities eligible for the sale of 
                    insurance...............................         326
65              Identification and mapping of special hazard 
                    areas...................................         328
66              Consultation with local officials...........         347
67              Appeals from proposed flood elevation 
                    determinations..........................         349
68              Administrative hearing procedures...........         352
69

[Reserved]

70              Procedure for map correction................         354
71              Implementation of coastal barrier 
                    legislation.............................         357
72              Procedures and fees for processing map 
                    changes.................................         361
73              Implementation of section 1316 of the 
                    National Flood Insurance Act of 1968....         363
74

[Reserved]

75              Exemption of State-owned properties under 
                    self-insurance plan.....................         364
76

[Reserved]

77              Acquisition of flood damaged structures.....         367
78              Flood mitigation assistance.................         369
79

[Reserved]

                     FEDERAL CRIME INSURANCE PROGRAM
80              Description of program and offer to agents..         373
81              Purchase of insurance and adjustment of 
                    claims..................................         377
82              Protective device requirements..............         381
83              Coverages, rates, and prescribed policy 
                    forms...................................         388

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84-149

[Reserved]

                SUBCHAPTER C--FIRE PREVENTION AND CONTROL
150             Public safety awards to public safety 
                    officers................................         407
151             Reimbursement for costs of firefighting on 
                    Federal property........................         410
152             State grants for arson research, prevention, 
                    and control.............................         415
153-199

[Reserved]

                    SUBCHAPTER D--DISASTER ASSISTANCE
200-201

[Reserved]

206             Federal Disaster Assistance for disasters 
                    declared on or after November 23, 1988..         422
207             Great Lakes planning assistance.............         509
208-219

[Reserved]

220             Temporary Relocation Assistance.............         511
221             Permanent Relocation Assistance.............         518
222             Superfund cost share eligibility criteria 
                    for permanent and temporary relocation..         521
223-299

[Reserved]

                       SUBCHAPTER E--PREPAREDNESS
300             Disaster preparedness assistance............         525
301             Contributions for civil defense equipment...         526
302             Civil defense-State and local Emergency 
                    Management Assistance Program (EMA).....         530
303             Procedure for withholding payments for 
                    financial contributions under the 
                    Federal Civil Defense Act...............         539
304             Consolidated grants to insular areas........         541
305

[Reserved]

306             Official civil defense insigne..............         542
307

[Reserved]

308             Labor standards for federally assisted 
                    contracts...............................         544
309-311

[Reserved]

312             Use of civil defense personnel, materials, 
                    and facilities for natural disaster 
                    purposes................................         550
313-319

[Reserved]

320             Dispersion and protective construction: 
                    Policy, criteria, responsibilities (DMO-
                    1)......................................         553
321             Maintenance of the mobilization base 
                    (Department of Defense, Department of 
                    Energy, Maritime Administration)........         555
323             Guidance on priority use of resources in 
                    immediate post attack period (DMO-4)....         557

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324             National security policy governing 
                    scientific and engineering manpower 
                    (DMO-5).................................         563
325             Emergency health and medical occupations....         564
327             Policy on use of Government-owned industrial 
                    plant equipment by private industry 
                    (DMO-10A)...............................         566
328             General policies for strategic and critical 
                    materials stockpiling (DMO-11)..........         567
329             Use of priorities and allocation authority 
                    for Federal supply classification (FSC) 
                    common use items (DMO-12)...............         569
330             Policy guidance and delegation of 
                    authorities for use of priorities and 
                    allocations to maximize domestic energy 
                    supplies in accordance with subsection 
                    101(c) of the Defense Production Act of 
                    1950, as amended (DMO-13)...............         570
331             Preservation of the mobilization base 
                    through the placement of procurement and 
                    facilities in labor surplus areas.......         572
332             Voluntary agreements under section 708 of 
                    the Defense Production Act of 1950, as 
                    amended.................................         573
333             Peacetime screening.........................         576
334             Graduated mobilization response.............         577
335

[Reserved]

336             Predesignation of nonindustrial facilities 
                    (NIF) for national security emergency 
                    use.....................................         581
337-349

[Reserved]

350             Review and approval of State and local 
                    radiological emergency plans and 
                    preparedness............................         584
351             Radiological emergency planning and 
                    preparedness............................         594
352             Commercial Nuclear Power Plants: Emergency 
                    Preparedness Planning...................         600
353             Fee for services in support, review and 
                    approval of State and local government 
                    or licensee radiological emergency plans 
                    and preparedness........................         606
354             Fee for services to support FEMA'S offsite 
                    Radiological Emergency Preparedness 
                    Program.................................         614
355-359

[Reserved]

360             State assistance programs for training and 
                    education in comprehensive emergency 
                    management..............................         618
361             National earthquake hazards reduction 
                    assistance to State and local 
                    governments.............................         620
362             Criteria for acceptance of gifts, bequests, 
                    or services.............................         626
363-399

[Reserved]

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                          SUBCHAPTER A--GENERAL





PART 0--GENERAL STATEMENTS OF POLICY [RESERVED]






PART 1--RULEMAKING; POLICY AND PROCEDURES--Table of Contents




                           Subpart A--General

Sec.
1.1  Purpose.
1.2  Definitions.
1.3  Scope.
1.4  Policy and procedures.
1.5  Rules docket.
1.6  Ex parte communications.
1.7  Regulations agendas.
1.8  Regulations review.
1.9  Regulatory impact analyses.

                  Subpart B--Procedures for Rulemaking

1.10  Initiation of rulemaking.
1.11  Advance notice of proposed rulemaking.
1.12  Notice of proposed rulemaking.
1.13  Participation by interested persons.
1.14  Additional rulemaking proceedings.
1.15  Hearings.
1.16  Adoption of a final rule.
1.17  Petitions for reconsideration.
1.18  Petition for rulemaking.

    Authority: 5 U.S.C. 551, 552, 553; 5 U.S.C. 601, et seq.; E.O. 
12291. Reorganization Plan No. 3 of 1978; E.O. 12127; E.O. 12148.

    Source: 46 FR 32584, June 24, 1981, unless otherwise noted.



                           Subpart A--General



Sec. 1.1  Purpose.

    (a) This part contains the basic policies and procedures of the 
Federal Emergency Management Agency (FEMA) for adoption of rules. These 
policies and procedures incorporate those provisions of section 4 of the 
Administrative Procedure Act (APA) (5 U.S.C. 553) which FEMA will 
follow. This part and internal FEMA Manuals implement Executive Order 
12291.
    (b) Rules which must be published are described in section 3(a) of 
the APA, 5 U.S.C. 552(a). FEMA implementation of paragraph (a) is 
contained in 44 CFR part 5, subpart B.
    (c) This part contains policies and procedures for implementation of 
the Regulatory Flexibility Act which took effect January 1, 1981.
    (d) A FEMA Manual No. 1140.1, ``The Formulation, Drafting, 
Clearance, and Publication of Federal Register Documents'' has been 
issued describing the internal procedures including policy level 
oversight of FEMA for:
    (1) Publishing the semiannual agenda of significant regulations 
under development and review;
    (2) Making initial determinations with respect to significance of 
proposed rulemaking;
    (3) Determining the need for regulatory analyses; and
    (4) Reviewing existing regulations, including the reviews required 
by the Regulatory Flexibility Act.
    (e) As the FEMA Manual deals with internal management it is not 
subject to the requirements either of 5 U.S.C. 552 or 553. Its 
provisions are not part of this rule and reference to it is informative 
only.

[46 FR 32584, June 24, 1981, as amended at 49 FR 33878, Aug. 27, 1984]



Sec. 1.2  Definitions.

    (a) Rule or regulation means the whole or a part of any agency 
statement of general applicability and future effect designed to (1) 
implement, interpret, or prescribe law or policy, or (2) describe 
procedures or practice requirements. It includes any rule of general 
applicability governing Federal grants to State and local governments 
for which the agency provides an opportunity for notice and public 
comment, except that the term rule does not include a rule of particular 
applicability relating to rates, wages, prices, facilities, appliances, 
services, or allowances therefor or to valuations, costs or accounting, 
or practices relating to such rates, wages, structures, prices, 
appliances, services, or allowances. For purposes of this part the term 
rule does not include regulations issued with respect to a military or 
foreign affairs function of the United States.

[[Page 8]]

    (b) Rulemaking means the FEMA process for considering and 
formulating the issuance, amendment or repeal of a rule.
    (c) Director means the Director, FEMA, or an official to whom the 
Director has expressly delegated authority to issue rules.
    (d) FEMA means Federal Emergency Management Agency.
    (e) Major rule means any regulation that is likely to result in:
    (1) An annual effect on the economy of $100 million or more;
    (2) A major increase in costs or prices for consumers, individual 
industries, Federal, State, or local government agencies, or geographic 
regions; or
    (3) Significant adverse effects on competition, employment, 
investment, productivity, innovation, or on the ability of United 
States-based enterprises to compete with foreign-based enterprises in 
domestic or export markets.

[46 FR 32584, June 24, 1981, as amended at 49 FR 38118, Sept. 27, 1984]



Sec. 1.3  Scope.

    (a) This part prescribes general rulemaking procedures for the 
issuance, amendment, or repeal of rules in which participation by 
interested persons is required by 5 U.S.C. 553 or other statutes, by 
Executive Order 12291, by FEMA policy, or by Sec. 1.4 of this part.
    (b) Any delegation by the Director of authority to issue rules may 
not be further redelegated, unless expressly provided for in the 
delegation.
    (c) This part does not apply to rules issued in accordance with the 
formal rulemaking provisions of the Administrative Procedure Act (5 
U.S.C. 556, 557).



Sec. 1.4  Policy and procedures.

    (a) In promulgating new regulations, reviewing existing regulations, 
and developing legislative proposals concerning regulation, FEMA, to the 
extent permitted by law, shall adhere to the following requirements:
    (1) Administrative decisions shall be based on adequate information 
concerning the need for and consequences of proposed government action;
    (2) Regulatory action shall not be undertaken unless the potential 
benefits to society for the regulation outweigh the potential costs to 
society;
    (3) Regulatory objectives shall be chosen to maximize the net 
benefits to society;
    (4) Among alternative approaches to any given regulatory objective, 
the alternative involving the least net cost to society shall be chosen; 
and
    (5) FEMA shall set regulatory priorities with the aim of maximizing 
the aggregate net benefits to society, taking into account the condition 
of the particular entities affected by regulations, the condition of the 
national economy, and other regulatory actions contemplated for the 
future.
    (b) It is the policy of FEMA to provide for public participation in 
rulemaking regarding its programs and functions, including matters that 
relate to public property, loans, grants, or benefits, or contracts, 
even though these matters are not subject to a requirement for notice 
and public comment rulemaking by law.
    (c) FEMA will publish notices of proposed rulemaking in the Federal 
Register and will give interested persons an opportunity to participate 
in the rulemaking through submission of written data, views, and 
arguments with or without opportunity for oral presentation.
    (d) In order to give the public, including small entities and 
consumer groups, an early and meaningful opportunity to participate in 
the development of rules, for a number of regulations the Director will 
employ additional methods of inviting public participation. These 
methods include, but are not limited to, publishing advance Notices of 
Proposed Rulemaking (ANPR), which can include a statement with respect 
to the impact of the proposed rule on small entities; holding open 
conferences; convening public forums or panels, sending notices of 
proposed regulations to publications likely to be read by those affected 
and soliciting comment from interested parties by such means as direct 
mail. An ANPR should be used to solicit public comment early in the 
rulemaking process for significant rules.
    (e) It is the policy of FEMA that its notices of proposed rulemaking 
are to afford the public at least sixty days for

[[Page 9]]

submission of comments unless the Director makes an exception and sets 
forth the reasons for the exception in the preamble to the notice of 
proposed rulemaking. This period shall also include any period of review 
required by the Office of Management and Budget in accordance with the 
Paperwork Reduction Act of 1980.
    (f) Unless required by statute or Executive Order, notice and public 
procedure may be omitted if the Director, for good cause, determines in 
a particular case or class of cases that notice and public procedure is 
impractical, unnecessary or contrary to the public interest and sets 
forth the reason for the determination in the rulemaking document or, 
for a class of cases, in a published rule or statement of policy. In a 
particular case, the reasons for the determination will be stated in the 
rulemaking document. Notice and public procedure may also be omitted 
with respect to statements of policy, interpretative rules, rules 
governing FEMA's organization or its own internal practices or 
procedures, or if a statute expressly authorizes omission.
    (g) A final substantive rule will be published not less than 30 days 
before its effective date unless it grants or recognizes an exemption or 
relieves a restriction or unless the rulemaking document states good 
cause for its taking effect less than 30 days after publication. 
Statements of policy and interpretative rules will usually be made 
effective on the date of publication.
    (h) This part shall not apply to any regulation that responds to an 
emergency situation, provided that, any such regulation shall be 
reported to the Director, Office of Management and Budget, as soon as is 
practicable. FEMA shall publish in the Federal Register a statement of 
the reasons why it is impracticable for the agency to follow the 
procedures of Executive Order 12291 with respect to such a rule, and the 
agency shall prepare and transmit, if needed, as soon as is practicable 
a Regulatory Impact Analysis of any such major rule.

[46 FR 32584, June 24, 1981, as amended at 49 FR 38119, Sept. 27, 1984; 
50 FR 40004, Oct. 1, 1985]



Sec. 1.5  Rules docket.

    (a) Documents which are public records and which are a part of a 
specific rulemaking procedure, including but not limited to, advance 
notices of proposed rulemaking, notices of proposed rulemaking, written 
comments addressed to the merits of a proposed rule, and comments 
received in response to notices, or withdrawals or terminations of 
proposed rulemaking, petitions for rulemaking, requests for oral 
argument in public participation cases, requests for extension of time, 
grants or denials of petitions or requests, transcripts or minutes of 
informal hearings, final rules and general notices shall be maintained 
in the Office of General Counsel. All public rulemaking comments should 
refer to the docket number which appears in the heading of the rule and 
should be addressed to the Rule Docket Clerk, Federal Emergency 
Management Agency, Office of General Counsel.
    (b) Documents which are a part of a specific rulemaking proceeding 
are public records. After a docket is established, any person may 
examine docketed material at any time during established hours of 
business and may obtain a copy of any docketed material upon payment of 
the prescribed fee. (See part 5 of this chapter.)

[46 FR 32584, June 24, 1981, as amended at 48 FR 44542, Sept. 29, 1983]



Sec. 1.6  Ex parte communications.

    In rulemaking proceedings subject only to the procedural 
requirements of 5 U.S.C. 553:
    (a) All oral communications from outside FEMA of significant 
information and argument respecting the merits of a proposed rule, 
received after notice of proposed informal rulemaking and in its course 
by FEMA or its offices and divisions or their personnel participating in 
the decision, should be summarized in writing and placed promptly in the 
Rules Docket File available for public inspection.
    (b) FEMA may conclude that restrictions on ex parte communications 
in particular rulemaking proceedings are necessitated by consideration 
of fairness or for other reasons.

[[Page 10]]



Sec. 1.7  Regulations agendas.

    (a) The FEMA semi-annual agenda called for by Executive Order 12291 
will be part of the Unified Agenda of Federal Regulations published in 
April and October of each year.
    (b) In accordance with 5 U.S.C. 605, the regulatory flexibility 
agenda required by 5 U.S.C. 602 and the list of rules, if any, to be 
reviewed pursuant to 5 U.S.C. 610 shall be included in the FEMA 
semiannual agenda described in paragraph (a) of this section.
    (c) The semiannual agenda shall, among other items, include:
    (1) A summary of the nature of each major rule being considered, the 
objectives and legal basis for the issuance of the rule, and an 
approximate schedule for completing action on any major rule for which 
the agency has issued a notice of proposed rulemaking.
    (2) The name and telephone number of a knowledgeable agency official 
for each item on the agenda; and
    (3) A list of existing regulations to be reviewed under the terms of 
the Order and a brief discussion of each such regulation.

[46 FR 32584, June 24, 1981, as amended at 49 FR 33878, Aug. 27, 1984]



Sec. 1.8  Regulations review.

    (a) As part of the semiannual agenda described in Sec. 1.7 of this 
part, FEMA will publish in the Federal Register and keep updated a plan 
for periodic review of existing rules at least within 10 years from date 
of publication of a rule as final. This includes those that have 
significant impact on a substantial number of small entities.
    (b) The purpose of the review shall be to determine whether such 
rules should be continued without change, or should be amended or 
rescinded, consistent with the stated objectives of applicable statutes, 
including minimizing any significant economic impact of the rules upon a 
substantial number of small entities.
    (c) In reviewing rules FEMA shall consider the following factors:
    (1) The continued need for the rule;
    (2) The nature, type and number of complaints or comments received 
concerning the rule from the public;
    (3) The complexity of the rule, including need for review of 
language for clarity;
    (4) The extent to which the rule overlaps, duplicates or conflicts 
with other Federal rules, and, to the extent feasible, with State and 
local governmental rules; and
    (5) The length of time since the rule has been evaluated or the 
degree to which technology, economic conditions, or other factors have 
changed in the area affected by the rule.



Sec. 1.9  Regulatory impact analyses.

    (a) FEMA shall, in connection with any major rule, prepare and 
consider a Regulatory Impact Analysis. Such analysis may be combined 
with the Regulatory Flexibility Analysis described in Secs. 1.12(f) and 
1.16(c) of this part.
    (b) FEMA shall initially determine whether a rule it intends to 
propose or to issue is a major rule and, if a major rule, shall prepare 
Regulatory Impact Analyses and transmit them, along with all notices of 
proposed rulemaking and all final rules, to the Director, Office of 
Management and Budget, as follows:
    (1) If no notice of proposed rulemaking is to be published for a 
proposed major rule that is not an emergency rule, the agency shall 
prepare only a final Regulatory Impact Analysis, which shall be 
transmitted, along with the proposed rule, to the Director, Office of 
Management and Budget, at least 60 days prior to the publication of the 
major rule as a final rule;
    (2) With respect to all other major rules, FEMA shall prepare a 
preliminary Regulatory Impact Analysis, which shall be transmitted, 
along with a notice of proposed rulemaking, to the Director, Office of 
Management and Budget, at least 60 days prior to the publication of a 
notice of proposed rulemaking, and a final Regulatory Impact Analysis, 
which shall be transmited along with the final rule at least 30 days 
prior to the publication of the major rule as a final rule;
    (3) For all rules other than major rules, FEMA shall, unless an 
exemption has been granted, submit to the Director, Office of Management 
and

[[Page 11]]

Budget, at least 10 days prior to publication, every notice of proposed 
rulemaking and final rule.
    (c) To permit each major rule to be analyzed in light of the 
requirements stated in section 2 of Executive Order 12291, each 
preliminary and final Regulatory Impact Analysis shall contain the 
following information:
    (1) A description of the potential benefits of the rule, including 
any beneficial effects that cannot be quantified in monetary terms, and 
the identification of those likely to receive the benefits;
    (2) A description of the potential costs of the rule, including any 
adverse effects that cannot be quantified in monetary terms, and the 
identification of those likely to bear the costs;
    (3) A determination of the potential net benefits of the rule, 
including an evaluation of effects that cannot be quantified in monetary 
terms;
    (4) A description of alternative approaches that could substantially 
achieve the same regulatory goal at lower cost, together with an 
analysis of this potential benefit and costs and a brief explanation of 
the legal reasons why such alternatives, if proposed, could not be 
adopted; and
    (5) Unless covered by the description required under paragraph 
(c)(4) of this section, an explanation of any legal reasons why the rule 
cannot be based on the requirements set forth in section 2 of Executive 
Order 12291.



                  Subpart B--Procedures for Rulemaking



Sec. 1.10  Initiation of rulemaking.

    Rulemaking may be initiated on the Director's motion or upon motion 
of an official to whom rulemaking authority has been delegated. 
Rulemaking may also be initiated on the petition of any interested 
person in accordance with the provisions of Sec. 1.18. Interested person 
includes a Federal, State, or local government or government agency.



Sec. 1.11  Advance notice of proposed rulemaking.

    An Advance Notice of Proposed Rulemaking will be published in the 
Federal Register and contains:
    (a) A description of the proposed new program or program changes, 
and why they are needed;
    (b) A presentation of the major policy issues involved;
    (c) A request for comments, both specific and general, on the need 
for the proposed rule and the provisions that the rule might include;
    (d) If appropriate, a list of questions about the proposal which 
seeks to bring out detailed comments;
    (e) If known, an estimate of the reporting or recordkeeping 
requirements, if any, that the rule would impose; and
    (f) The time within which comments may be submitted to the Rules 
Docket Clerk, Federal Emergency Management Agency, Washington, DC 20472.

[46 FR 32584, June 24, 1981, as amended at 48 FR 44542, Sept. 29, 1983; 
49 FR 33879, Aug. 27, 1984]



Sec. 1.12  Notice of proposed rulemaking.

    Each notice of proposed rulemaking required by statute, executive 
order, or by Sec. 1.4 will be published in the Federal Register and will 
include:
    (a) The substance or terms of the proposed rule or a description of 
the subject matter and issues involved.
    (b) A statement of how and to what extent interested persons may 
participate in the proceeding.
    (c) Where participation is limited to written comments, a statement 
of the time within which such comments must be submitted.
    (d) A reference to the legal authority under which the proposal is 
issued.
    (e) In a proceeding which has provided Advance Notice of Proposed 
Rulemaking, an analysis of the principal issues and recommendations 
raised by the comments, and the manner in which they have been addressed 
in the proposed rulemaking.
    (f)(1) A brief statement setting forth the agency's initial 
determination whether the proposed rule is a major rule, together with 
the reasons underlying that determination;
    (2) For each proposed major rule, a brief summary of the agency's 
preliminary Regulatory Impact Analysis; and
    (3) The initial regulatory flexibility analysis or a summary thereof 
as required by the Regulatory Flexibility

[[Page 12]]

Act (5 U.S.C. 601, et seq.), or a certification that the rule, if 
promulgated, will not have a significant economic impact on a 
significant number of small entities pursuant to 5 U.S.C. 605. Such 
certification may be made by any FEMA official with rulemaking 
authority.
    (g) It is desirable, but not required, that the notices contain a 
target deadline for issuance of the regulation, and that to the extent 
feasible, this deadline be met.
    (h) If the rule is one which contains a requirement for collection 
of information, a copy of the rule will be furnished OMB in accordance 
with 44 U.S.C. 3504(h).

[46 FR 32584, June 24, 1981, as amended at 49 FR 38119, Sept. 27, 1984]



Sec. 1.13  Participation by interested persons.

    (a) Unless the notice otherwise provides, any interested person may 
participate in rulemaking proceedings by submitting written data, views 
or arguments within the comment time stated in the notice. In addition, 
the Director may permit the filing of comments in response to original 
comments.
    (b) In appropriate cases, the Director may provide for oral 
presentation of views in additional proceedings described in Sec. 1.14.
    (c) Copies of regulatory flexibility analyses shall be furnished the 
Chief Counsel for Advocacy of the Small Business Administration.



Sec. 1.14  Additional rulemaking proceedings.

    The Director may invite interested persons to present oral 
arguments, appear at informal hearings, or participate in any other 
procedure affording opportunity for oral presentation of views. The 
transcript or minutes of such meetings, as appropriate, will be kept and 
filed in the Rules Docket.



Sec. 1.15  Hearings.

    (a) The provisions of 5 U.S.C. 556 and 557, which govern formal 
hearings in adjudicatory proceedings, do not apply to informal 
rulemaking proceedings described in this part. When opportunity is 
afforded for oral presentation, the informal ``hearing'' is a 
nonadversary, fact-finding proceeding. Any rule issued in a proceeding 
under this part in which a hearing is held need not be based exclusively 
on the record of such hearing.
    (b) When a hearing is provided, the Director will designate a 
representative to conduct the hearing.



Sec. 1.16  Adoption of a final rule.

    (a) All timely comments will be considered in taking final action on 
a proposed rule. Each preamble to a final rule will contain a short 
analysis and evaluation of the relevant significant issues set forth in 
the comments submitted, and a clear concise statement of the basis and 
purpose of the rule.
    (b) When determined necessary by the Director in accordance with the 
provisions of 1 CFR 18.12, the preamble shall contain the following 
information:
    (1) A discussion of the background and major issues involved;
    (2) In the case of a final rule, any significant differences between 
it and the proposed rule;
    (3) A response to substantive public comments received; and
    (4) Any other information the Director considers appropriate.
    (c) At the time of publication of the final rule, a statement shall 
be published describing how the public may obtain copies of the final 
regulatory flexibility analysis which must be prepared in accordance 
with 5 U.S.C. 604 unless the procedure for waiver or delay of completion 
under 5 U.S.C. 608 is followed.
    (d) Before approving any final major rule FEMA will:
    (1) Make a determination that the regulation is clearly within the 
authority delegated by law and consistent with congressional intent and 
include in the Federal Register at the time of promulgation a memorandum 
of law supporting that determination; and
    (2) Make a determination that the factual conclusions upon which the 
rule is based have substantial support in the agency record, viewed as a 
whole, with full attention to public comments in general and the 
comments of persons directly affected by the rule in particular.

[[Page 13]]



Sec. 1.17  Petitions for reconsideration.

    Petitions for reconsideration of a final rule will not be 
considered. Such petitions, if filed, will be treated as petitions for 
rulemaking in accordance with Sec. 1.18.



Sec. 1.18  Petition for rulemaking.

    (a) Any interested person may petition the Director for the 
issuance, amendment, or repeal of a rule. For purposes of this section 
the term person includes a Federal, State or local government or 
government agency. Each petition shall:
    (1) Be submitted to the Rules Docket Clerk;
    (2) Set forth the substance of the rule or amendment proposed or 
specify the rule sought to be repealed or amended;
    (3) Explain the interest of the petitioner in support of the action 
sought; and
    (4) Set forth all data and arguments available to the petitioner in 
support of the action sought.
    (b) No public procedures will be held directly on the petition 
before its disposition. If the Director finds that the petition contains 
adequate justification, a rulemaking proceeding will be initiated or a 
final rule will be issued as appropriate. If the Director finds that the 
petition does not contain adequate justification, the petition will be 
denied by letter or other notice, with a brief statement of the ground 
for denial. The Director may consider new evidence at any time; however, 
repetitious petitions for rulemaking will not be considered.



PART 2--ORGANIZATION, FUNCTIONS, AND DELEGATIONS OF AUTHORITY--Table of Contents




    Subpart A--Organization, Functions, and Delegations of Authority

                                 General

Sec.
2.1  Purpose.
2.2  Organization of FEMA.
2.3  Exercise of authority.
2.4  General limitations and reservations.
2.5  Delegations not included.
2.6  Redelegation of authority.
2.7  General delegations.
2.8  Designation of subordinates to act.

                              FEMA Offices

2.11  Office of the Director.
2.12  Office of the Inspector General.
2.13  Office of the General Counsel.
2.14  Office of Congressional and Governmental Affairs.
2.15  Office of Emergency Information and Public Affairs.
2.16  Office of Policy and Assessment.
2.17  Office of Human Resources Management.
2.18  Office of Equal Rights.
2.19  Office of Financial Management.
2.20  Office of Regional Operations.
2.21  Ombudsman. [Reserved]
2.22  Regional Offices.

                             Administrations

2.31  Federal Insurance Administration.
2.32  United States Fire Administration.

                              Directorates

2.41  Mitigation Directorate.
2.42  Preparedness, Training, and Exercises Directorate.
2.43  Response and Recovery Directorate.
2.44  Operations Support Directorate.

                          Subpart B  [Reserved]

                     Subpart C--OMB Control Numbers

2.80  Purpose
2.81  OMB control numbers assigned to information collections.

    Authority: 5 U.S.C. 552; Reorganization Plan No. 3 of 1978, 5 U.S.C. 
App. 1; E.O. 12127, 3 CFR, 1979 Comp., p. 376; E.O. 12148, as amended, 3 
CFR, 1979 Comp., p. 412.

    Source: 59 FR 26133, May 19, 1994, unless otherwise noted.



    Subpart A--Organization, Functions, and Delegations of Authority

                                 General



Sec. 2.1  Purpose.

    This part describes the organization of the Federal Emergency 
Management Agency (FEMA), and the general course and method by which its 
functions are administered. It provides for the exercise by officials of 
FEMA of authorities that are vested in the Director specifically by 
statute, as head of an agency, or as a consequence of a law authorizing 
such exercise. It also provides for exercise of authorities that have 
been transferred to the Director by Reorganization Plan or delegated to

[[Page 14]]

the Director by Executive Order or other appropriate document.



Sec. 2.2  Organization of FEMA.

    (a) The Director is the head of FEMA. All authorities of FEMA are 
either vested in the Director by statute or have been transferred to or 
delegated to the Director. Notwithstanding any delegation by the 
Director to a subordinate officer of FEMA, the Director may also 
exercise such authority.
    (b) FEMA is composed of the Offices, Administrations, and 
Directorates, the responsibilities of which are described in Secs. 2.11 
through 2.44.
    (c) The Executive Board of FEMA consists of the senior managers 
appointed by the President and confirmed by the Senate as well as 
representatives of the Regional Directors and other senior managers as 
the Director shall designate from time to time. The principal function 
of the Executive Board is to review the Agency's overall direction, 
performance, and policies. The Executive Board will hold regular 
meetings on a quarterly basis and may hold special meetings at the 
discretion of the Director.



Sec. 2.3  Exercise of authority.

    Exercise of the authority delegated by this subpart or redelegated 
pursuant to this subpart is subject to the direction, control, and 
authority of the Director, and is governed by applicable laws, Executive 
Orders, Federal agency regulations or issuances applicable to FEMA. Such 
exercise is also governed by regulations issued by FEMA, and by 
policies, objectives, directives, manuals, instructions, plans, 
standards, procedures and limitations issued from time to time by or on 
behalf of the Director.



Sec. 2.4  General limitations and reservations.

    (a) All powers and duties not delegated by the Director in this 
subpart, nor otherwise provided for in Title 44, are reserved to the 
Director.
    (b) The following specific authorities are reserved to the Director:
    (1) Certain authorities relating to reporting to Congress and the 
President including those under:
    (i) Section 16 of the Federal Fire Prevention and Control Act of 
1974 (15 U.S.C. 2215);
    (ii) Section 1320 of the National Flood Insurance Act (42 U.S.C. 
4027);
    (iii) Section 1234 of the National Housing Act (12 U.S.C. 1749bbb-
10d);
    (iv) Section 406 of the Federal Civil Defense Act of 1950, as 
amended (50 U.S.C. App. 2258);
    (v) Section 5(b)(1)(D) of the Earthquake Hazards Reduction Act of 
1977 (42 U.S.C. 7704(b)(1)(D)); and
    (vi) Section 2-105 of Executive Order 12148 of July 20, 1979.
    (2) Authorities connected with declaration of major disasters and 
emergencies, and with delegations to other agencies including:
    (i) The authority to make recommendations to the President 
concerning the determination that an emergency exists pursuant to 
section 501 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5191);
    (ii) The authority to make recommendations to the President 
concerning the issuance of a major disaster declaration pursuant to 
section 401 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5170); and
    (iii) Provision is made in Sec. 2.11 of this part for the Deputy 
Director to exercise the authorities set out in this paragraph when the 
Director is unavailable due to illness or incapacity.
    (3) Authorities relating to voluntary agreements under section 708 
of the Defense Production Act (50 U.S.C. App. 2158) delegated to the 
Director in section 501 of Executive Order 10480.
    (4) Authority to make the determination concerning federal operation 
of the program and the report to Congress under section 1340 of the 
National Flood Insurance Act (42 U.S.C. 4071).
    (5) Authority to appoint Federal Coordinating Officers under section 
302 of the Robert T. Stafford Disaster Relief and Emergency Assistance 
Act (42 U.S.C. 5143).



Sec. 2.5  Delegations not included.

    Other delegations of authority have been and will be made in other 
FEMA regulations and by internal FEMA directives that concern internal 
FEMA

[[Page 15]]

policies and operations. These are valid delegations. Without in any way 
limiting the number of those delegations, and without describing all of 
them in this listing which is not complete, they include those:
    (a) Delegations concerning Federal personnel matters such as those 
concerning appointing authority, compensation, and so on. These are 
considered internal personnel rules and are not published in this 
chapter but are published in a FEMA Instruction.
    (b) Delegation to the General Counsel as Ethics Counselor under 5 
CFR part 2638.
    (c) Delegations under parts 5 and 6 of this subchapter relating to 
the Freedom of Information Act and Privacy Act.
    (d) Delegations to several officials relating to authentication of 
records under 44 CFR 5.82.
    (e) Delegations to the General Counsel and Chief Financial Officer 
with respect to claims under part 11 of this subchapter.
    (f) Delegations to classify information originally as Secret or 
Confidential.
    (g) Delegations to make certifications and findings under the 
Regulatory Flexibility Act, 5 U.S.C. 601-612; the National Environmental 
Policy Act, 42 U.S.C. 4321-4335; the Paperwork Reduction Act, 44 U.S.C. 
3501-3520; E.O. 12612 of October 26, 1987, 3 CFR, 1987 Comp., p. 252; 
E.O. 12778 of October 23, 1991, 3 CFR, 1991 Comp., p. 359; E.O. 12866 of 
September 30, 1993, 3 CFR, 1993 Comp., p. 638; and any other 
certifications or findings required by existing or future laws, 
executive orders, or other authorities;
    (h) Delegations concerning environmental matters under part 10 of 
this subchapter; and
    (i) Delegations concerning floodplain management and wetlands 
protection matters under part 9 of this subchapter.



Sec. 2.6  Redelegation of authority.

    (a) It is FEMA's policy that the authorities delegated by this 
chapter should, whenever appropriate, be redelegated to the manager or 
official who has immediate responsibility for the action. Authority 
delegated by this chapter, unless otherwise specifically provided, may 
be redelegated in whole or in part provided any such redelegation is in 
writing and approved by the officer to whom the authority is initially 
delegated. This restriction does not apply to a temporary redelegation 
of authority to a principal deputy or first assistant to be exercised 
during the absence of the delegating official.
    (b) The authority to issue regulations having general applicability 
and future effect designed to implement, interpret or prescribe law or 
policy, and which are to be published in the Federal Register, may be 
delegated or redelegated only to positions for which it is required that 
the incumbent be confirmed by the United States Senate. This does not 
prohibit an acting official from issuing regulations. This paragraph 
does not apply to rules issued under parts 64, 65, 67, or 70 of this 
title.



Sec. 2.7  General delegations.

    (a) This section sets forth general delegations to the officers or 
employees named in paragraph (b) of this section.
    (b) The officers authorized to exercise authorities in paragraph (c) 
of this section are:
    (1) Deputy Director;
    (2) Chief of Staff;
    (3) Inspector General;
    (4) General Counsel;
    (5) Director of the Office of Congressional and Governmental 
Affairs;
    (6) Director of the Office of Emergency Information and Public 
Affairs;
    (7) Director of the Office of Policy and Assessment;
    (8) Director of the Office of Human Resources Management;
    (9) Director of the Office of Equal Rights;
    (10) Chief Financial Officer;
    (11) Director of the Office of Regional Operations;
    (12) Regional Directors;
    (13) Federal Insurance Administrator;
    (14) United States Fire Administrator;
    (15) Associate Director for Mitigation;
    (16) Associate Director for Preparedness, Training, and Exercises;

[[Page 16]]

    (17) Associate Director for Response and Recovery; and
    (18) Associate Director for Operations Support.
    (c) Each officer named in paragraph (b) of this section is 
authorized to:
    (1) Approve official travel as temporary duty travel on official 
business and allowable expenses incidental thereto for employees of 
their respective organizational units, in accordance with the Federal 
Travel Regulations; except that travel to and from points outside of the 
United States is subject to prior notification to the Director and 
foreign travel (i.e., travel outside the United States and its insular 
areas) is subject to prior approval of the Director. However, no officer 
or employee may approve his or her own travel. Travel of officers named 
in paragraph (b) of this section is approved by the Deputy Director or 
the Chief of Staff, except that travel of a Regional Director may be 
approved by the Deputy Regional Director for that Region.
    (2) Approve travel advances of funds through disbursing officers or 
imprest fund cashiers for employees of the respective organizational 
units who are entitled to per diem or mileage allowance or subsistence 
expenses in accordance with the Federal Travel Regulations.
    (3) Approve travel vouchers for employees of their respective 
organizational units.
    (4) Approve travel by employees of their respective organizations at 
the invitation and expense of parties outside of the Federal Government, 
with the concurrence of the Designated Agency Ethics Officer (DAEO) or a 
Deputy DAEO;
    (5) Approve funding requisitions;
    (6) As appropriate, issue final agency decisions on individual or 
class complaints of discrimination because of race, color, national 
origin, religion, sex, disability, age, or economic status.
    (7) Promulgate internal guidance to cover areas of assigned 
responsibilities.
    (8) Approve training costing less than $2500 (all expenses) or 
training of less than 80 hours in duration, whichever is more 
restrictive, except that this authority does not include authority to 
approve training involving the use of facilities of foreign governments 
or international organizations, which must be approved by the Director; 
or the authority to approve acceptance by employees of contributions or 
awards from non-Government organizations, whether in cash or in kind, 
which must be approved by the Director.
    (9) Adjust working hours for individual employees when there is 
special justification therefor that it is in the interest of FEMA or to 
accommodate individual needs of employees for legitimate reasons where 
the work of the agency will not be impeded.
    (10) Approve incentive awards to subordinates, Public Service 
Awards, cash awards of $1,500 or less for individuals and quality 
within-grade salary increases.
    (11) Enter into and administer funded and unfunded memoranda of 
understanding with respect to assigned duties.
    (12) Classify documents derivatively, based on the original 
classification by other Federal agencies or the Director.



Sec. 2.8  Designation of subordinates to act.

    Each officer named in Sec. 2.7(b) shall:
    (a) Submit to the Director, for approval, a list of three or more 
subordinates to act for such officer during his or her absence; and
    (b) Ensure that each Division Director, Branch Chief, or head of any 
other organizational unit under that officer's authority designate one 
or more subordinate employees to serve as acting head of the unit during 
the absence of the head of a unit or during a vacancy in the position.

                              FEMA Offices



Sec. 2.11  Office of the Director.

    The Deputy Director is the first assistant to the Director under the 
Vacancies Act, 5 U.S.C. 3341 et seq., and acts in place of the Director 
when the Director is not available because of illness or incapacity. The 
Deputy Director is the Chief Operating Officer of the Agency, with the 
duties and powers set forth in Presidential Memorandum of October 1, 
1993, ``Implementing Reform in the Executive Branch.'' The Deputy 
Director is authorized to exercise the

[[Page 17]]

duties and powers of the Director as necessary to carry out the 
responsibilities of the Chief Operating Officer and to act in place of 
the Director in the Director's unavailability.



Sec. 2.12  Office of the Inspector General.

    (a) Mission. The Office of the Inspector General serves FEMA as an 
independent unit to promote economy, efficiency, and effectiveness; to 
prevent waste, fraud, and abuse; and to keep the Congress and the 
Director fully informed on these subjects.
    (b) Functions. The principal functions of the Office of the 
Inspector General are:
    (1) Performance of all audit functions relating to programs and 
operations of FEMA;
    (2) Inspection of agency activities to identify actual or potential 
fraud, waste, abuse, or mismanagement and to develop recommendations for 
corrective action;
    (3) Investigation of allegations of illegal, unethical, or other 
activities that may lead to civil or criminal liability on the part of 
FEMA or its employees, contractors, or program participants; and
    (4) Referral of potential criminal prosecutions to the Department of 
Justice, under 28 U.S.C. 535.
    (c) Authority. The position of Inspector General of FEMA is created 
by statute (The Inspector General Act of 1978, as amended, 5 U.S.C. App. 
3 Secs. 1-15). The Inspector General is authorized to exercise the 
duties and powers set forth in that statute.



Sec. 2.13  Office of the General Counsel.

    (a) Mission. The Office of the General Counsel renders legal advice 
and assistance on all matters related to Agency programs and operation, 
and conducts the Agency's ethics program and Freedom of Information Act/
Privacy Act program.
    (b) Functions. The principal functions of the Office of the General 
Counsel are:
    (1) Rendering legal opinions and advice with respect to the duties, 
powers, and responsibilities of the Director, FEMA, and other Agency 
officers and employees and the applications of statutes, rules and 
regulations, other administrative issuances, and judicial precedents to 
Agency operations;
    (2) Review for legal sufficiency of all Agency documents requiring 
legal interpretation or opinion.
    (3) Establishment of Agency policy for and conduct of all 
appearances on behalf of FEMA in litigation or administrative 
proceedings and hearings;
    (4) Liaison to the Department of Justice except when otherwise 
provided by the Office of the Inspector General.
    (5) Coordination of the FEMA regulatory program, including liaison 
to the Office of Management and Budget and the Office of the Federal 
Register;
    (6) Operation of the FEMA legislative reference program, including 
liaison to the Office of Management and Budget and allied legislative 
proposals; and
    (7) Operation of FEMA's ethics program and Freedom of Information 
Act and Privacy Act program.
    (c) Delegated authorities. The General Counsel is authorized to 
exercise the duties and powers of the Director to:
    (1) Accept service of process on behalf of the Agency, and on behalf 
of its officials and employees in connection with performance of their 
official duties;
    (2) Determine the agency's position with respect to litigation and 
refer matters directly to the Attorney General for prosecution or for 
initiation of litigation;
    (3) Determine the government's position in connection with any 
dispute before a Board of Contract Appeals, including the authority to 
settle or adjust any such claim.
    (4) Consider, compromise and settle tort claims against FEMA, but 
any award, compromise, or settlement of more than $25,000 requires the 
prior written approval of the Attorney General or designee;
    (5) Serve as the Designated Agency Ethics Officer;
    (6) Make technical corrections to all FEMA documents, including 
rules and regulations submitted to the Federal Register;
    (7) Consider, compromise and settle personnel claims of less than 
$15,000 against FEMA;
    (8) Waive claims of the United States against a person arising out 
of pay and allowances to an employee of FEMA in amounts of not more than 
$1,500, and in

[[Page 18]]

accordance with the requirements of 5 U.S.C. 5584, and the implementing 
regulations and standards of the Comptroller General; and
    (9) Enter into ratification agreements at the direction of the 
Department of Justice in order to insure that FEMA's subrogation 
interest will be represented.



Sec. 2.14  Office of Congressional and Governmental Affairs.

    (a) Mission. The Office of Congressional and Governmental Affairs 
coordinates FEMA's ongoing emergency management relationships with the 
Congress, public interest groups, and State and local organizations.
    (b) Functions. The principal functions of the Office of 
Congressional and Governmental Affairs are:
    (1) Liaison with Congress, the Office of Management and Budget, and 
the White House on legislative matters directly affecting FEMA;
    (2) Advising the Director and other FEMA officials on actions 
pending or anticipated in Congress;
    (3) Liaison with Federal Coordinating Officers following 
declarations of disasters or emergencies under the Stafford Act, on 
matters requiring coordination with Congress; and
    (4) Liaison with FEMA's constituencies on FEMA legislative matters.
    (c) Delegated authorities. The Director of the Office of 
Congressional and Governmental Affairs is authorized to exercise the 
duties and powers of the Director in the Director's capacity as agency 
head in support of the functions listed in paragraph (b) of this 
section.



Sec. 2.15  Office of Emergency Information and Public Affairs.

    (a) Mission. The Office of Emergency Information and Public Affairs 
informs the public about FEMA's programs and activities, both in time of 
disaster and in other times.
    (b) Functions. The principal functions of the Office of Emergency 
Information and Public Affairs are:
    (1) Gathering and dissemination of information about FEMA's programs 
and activities;
    (2) Liaison with news media;
    (3) Management of Joint Information Centers during disasters.
    (c) Delegated authorities. The Director of the Office of Emergency 
Information and Public Affairs is authorized to exercise the duties and 
powers of the Director in the Director's capacity as agency head as set 
forth in paragraph (b) of this section.



Sec. 2.16  Office of Policy and Assessment.

    (a) Mission. The Office of Policy and Assessment manages and 
facilitates policy development, strategic planning, planning, 
performance standards and assessment, innovation, and organizational 
development to achieve FEMA's overall mission.
    (b) Functions. The principal functions of the Office of Policy and 
Assessment are:
    (1) Facilitation of the development and implementation of Agency 
policy, including systematic review and evaluation of that policy;
    (2) Development and coordination of FEMA's strategic planning 
process;
    (3) Development of standards and mechanisms for evaluation of Agency 
performance;
    (4) Development and implementation of a system for identifying 
shortfalls in Agency programs and performance and for monitoring 
progress towards their remediation;
    (5) Oversight of FEMA's implementation of the Government Performance 
and Results Act of 1993, Pub. L. 103-62, 107 Stat. 285.
    (6) Oversight of implementation of FEMA's environmental 
responsibilities;
    (7) Support of the FEMA Executive Board;
    (8) Oversight of, and provision of guidance for, FEMA's renewal and 
participation in the Reinvention Laboratory process; and
    (9) Facilitating institutional change and innovation.
    (c) Delegated authorities. The Director of the Office of Policy and 
Assessment is authorized to exercise the duties and powers of the 
Director in the Director's capacity as agency head in support of the 
functions listed in paragraph (b) of this section.

[[Page 19]]



Sec. 2.17  Office of Human Resources Management.

    (a) Mission. The Office of Human Resources Management provides and 
maintains a workforce capable of carrying out FEMA's mission.
    (b) Functions. The principal functions of the Office of Human 
Resources Management are:
    (1) Administration of FEMA's classification and position management 
programs;
    (2) Recruitment and placement of employees;
    (3) Administration of compensation and leave programs;
    (4) Management of FEMA's disaster personnel program;
    (5) Administration of workforce and workplace programs;
    (6) Management of FEMA's labor relations, employee relations, and 
employee benefit programs;
    (7) Administration of performance management and incentive awards 
programs;
    (8) Establishment and maintenance of personnel records; and
    (9) Coordination of affirmative employment programs with the Office 
of Equal Rights and support of FEMA's Offices, Administrations, and 
Directorates in meeting their affirmative actions goals.
    (c) Delegated authorities. The Director of the Office of Human 
Resources Management is authorized to exercise the duties and powers of 
the Director in the Director's capacity as agency head in support of the 
functions listed in paragraph (b) of this section.



Sec. 2.18  Office of Equal Rights.

    (a) Mission. The Office of Equal Rights assists management in 
fulfilling its responsibilities to ensure Equal Rights for all employees 
and applicants for employment, and to guarantee protection for the civil 
rights of every American receiving assistance from FEMA.
    (b) Functions. The principal functions of the Office of Equal Rights 
are:
    (1) Development, in coordination with Agency management, of multi-
year Affirmative Employment Plans and annual updates covering women, 
minority group members, and persons with disabilities;
    (2) Training regarding Equal Rights and Civil Rights and 
Responsibilities;
    (3) Investigation and non-adjudicatory resolution of complaints of 
discrimination and referral of unresolved complaints to the Equal 
Employment Opportunity Commission or the Department of Justice; and
    (4) Ensuring compliance with Civil Rights guidance in FEMA's 
programs and operations.
    (c) Delegated authorities. The Director of the Office of Equal 
Rights is authorized to exercise the duties and powers of the Director 
as set forth in:
    (1) E.O. 12336, as amended;
    (2) E.O. 12250;
    (3) E.O. 12067, as amended;
    (4) E.O. 11478, as amended;
    (5) E.O. 11141; and
    (6) E.O. 11063, as amended.



Sec. 2.19  Office of Financial Management.

    (a) Mission. The Office of Financial Management promotes sound 
financial management and accountability throughout the Agency by 
providing financial guidance, information, and services to FEMA 
management, its employees, and the Agency's customers.
    (b) Functions. This office reports directly to the Director of FEMA 
regarding financial management matters and is headed by the Chief 
Financial Officer. The principal functions of the Office of Financial 
Management are:
    (1) Oversight of all financial management activities relating to the 
programs and operations of the Agency, including fund manager for all 
Agency funds;
    (2) Development, operation, and maintenance of an integrated Agency 
accounting and financial management system, including internal and 
external financial reporting;
    (3) Oversight of the Agency's internal control guidance and review 
program;
    (4) Direction, management, and provision of policy guidance and 
oversight of Agency financial management personnel, activities, and 
operations;
    (5) Preparation of the annual report described in 31 U.S.C. 
902(a)(6) to the Director of FEMA and to the Office of Management and 
Budget;
    (6) Oversight of and responsibility for the formulation and 
execution of the

[[Page 20]]

Agency's budget and accounts for actual expenditures;
    (7) Preparation and submission of timely performance reports to the 
Director of FEMA and operating units;
    (8) Review, on a biennial basis, of the fees, royalties, rents, and 
other charges imposed by the Agency for services and things of value it 
provides, and recommendation of revision of those charges to reflect 
costs incurred by the Agency in providing those services and things of 
value.
    (c) Authority. The position of Chief Financial Officer was created 
by statute (Agency Chief Financial Officers Act, as amended, 31 U.S.C. 
901-1114, 3511-3521). The Chief Financial Officer is authorized to 
exercise the duties and powers set forth in that statute. The Chief 
Financial Officer is specifically authorized to:
    (1) Supervise the activities and functions of the Office of the 
Financial Management and oversee all financial management activities 
relating to the programs and operations of the Agency.
    (2) Direct, manage, and provide policy guidance and oversight of the 
Agency financial management personnel, activities and operations.
    (3) Establish and maintain an integrated Agency accounting and 
financial management system, including financial reporting and internal 
controls, that--
    (i) Complies with applicable accounting principles, standards, and 
requirements and standards prescribed by the Office of Management and 
Budget, the General Accounting Office, and the Department of the 
Treasury;
    (ii) Provides for complete, reliable and timely information, that is 
prepared on a uniform basis, and that is responsive to the financial 
management needs of the Agency; and,
    (iii) Complies with any other requirements applicable to such 
systems.
    (4) Prepare and submit a financial statement that conforms to the 
requirements of 31 U.S.C. 902 and 3515. Develop and implement the 5-year 
financial management plan as required by 31 U.S.C. 902(a)(5).
    (5) Develop the Agency's financial management plans and budgets, and 
review legislative proposals and other programmatic proposals to provide 
advice to the Director on the financial implications of such proposals.
    (6) Develop and implement Agency asset management systems, including 
systems for cash management, credit management, debt collection, and 
property and inventory management and control.
    (7) Review on a biennial basis the fees, royalties, rents and other 
charges imposed by the Agency for services and things of value it 
provides, and make recommendations to the Director on revising those 
charges to reflect actual costs incurred by the Agency in providing 
those services and things of value. Premiums and other policy holder 
charges that relate to the issuance of policies (National Flood 
Insurance and Crime Insurance programs) are set by the Federal Insurance 
Administrator pursuant to Federal law and regulation.
    (8) Develop, operate and maintain an Administrative Fund Control 
System that provides, for accurate and timely data on the status of each 
account. This Administrative Fund Control System shall comply with 
appropriate statutory requirements and regulations issued by General 
Accounting Office, Office of Management and Budget, the Department of 
the Treasury, and other central administrative agencies.
    (9) Establish and maintain the appropriate accounts designated by 
the Department of the Treasury, the General Accounting Office, and 
Office of Management and Budget and such subsidiary records as may be 
necessary for accounting, audit and management purposes. Establish and 
maintain controls for appropriations and other special limitations 
required by law. Maintain reliable accounting records that will be the 
basis for preparing and supporting the budget requests of the Agency, 
controlling the execution of the budget and providing financial 
information required by law and regulation.
    (10) Oversee the implementation of internal control systems that 
conform with rules, circulars, and other directives issued by General 
Accounting Office, Office of Management and Budget, and the Department 
of the Treasury. Report to the Director, as required by

[[Page 21]]

law and regulation, whether the Agency's internal control systems and 
other financial systems and processes comply with applicable law and 
regulation.
    (11) Develop and implement administrative standards and cost 
principles for the Agency's assistance programs in conformity with 
rules, circulars, and other directives that are issued by the General 
Accounting Office, the Office of Management and Budget, and the 
Department of the Treasury.
    (12) Develop and maintain procedures for approving requisitions for 
disbursing funds, reports of current accounts rendered by disbursing 
officers, and other financial and accounting documents involving FEMA, 
the General Accounting Office, the Department of the Treasury, and the 
Office of Management and Budget.
    (13) Certify to the General Accounting Office any charge against any 
officer or agent entrusted with public property, arising from any loss 
and accruing by this person's fault, to the Government as to the 
property so entrusted to this person.
    (14) Approve all expenditures and receipt all vouchers and other 
documents necessary to carry out FEMA's appropriations and programs.
    (15) Certify that all required documents, information and approvals 
respecting fiscal transactions are present; verify or cause to be 
verified the accuracy of the financial computations, the consistency of 
the information included in the various documents; and determine, or 
cause to be determined, that the financial transactions of the Agency 
are in strict accordance with the law, regulations and decisions.
    (16) Authorize officers and employees to certify vouchers.
    (17) Receive and credit amounts received to the applicable 
appropriation of FEMA or to the miscellaneous receipts account.
    (18) Request cashier designation and resolution from the Department 
of the Treasury, and designate cashiers to serve in FEMA.
    (19) Approve invitational travel for the Office of Financial 
Management.
    (20) Have access to records and documents as required by 31 U.S.C. 
902(b) (1)(A), (1)(B), and (1)(C). Access to records and documents is 
subject to the limitations in 31 U.S.C. 902(b)(2).



Sec. 2.20  Office of Regional Operations.

    (a) Mission. The Office of Regional Operations coordinates FEMA's 
policies, programs, and administrative and management guidance with 
Regional Directors and ensures that regional implementation is 
consistent with the Director's goals.
    (b) Functions. The principal functions of the Office of Regional 
Operations are:
    (1) Liaison between the Regional Directors and the Director, 
Associate Directors, Administrators, and Office Directors;
    (2) Advising the Director, Associate Directors, Administrators, and 
Office Directors on regional matters; and
    (3) Providing guidance to Regional Directors on policy, programs, 
operations, and administrative matters.
    (c) Delegated authorities. The Director of the Office of Regional 
Operations is authorized to exercise the duties and powers of the 
Director in the Director's capacity as agency head in support of the 
functions listed in paragraph (b) of this section.



Sec. 2.21  Ombudsman. [Reserved]



Sec. 2.22  Regional Offices.

    (a) Mission. The Regional Offices implement FEMA's policies and 
programs at the regional level.
    (b) Functions. The principal functions of the Regional Offices are:
    (1) Liaison, within the regions, with other Federal agencies, State 
and local governments, voluntary and other private organizations, and 
the public;
    (2) Recommendations to the Director on implementation of policy and 
improvement of the administration of FEMA's programs;
    (3) Administration of Comprehensive Cooperative Agreements, grants, 
and other financial assistance to State and local governments;
    (4) Response to disasters and emergencies declared under the 
Stafford Act, through Regional Response Teams;
    (5) Recovery activities under the Stafford Act;

[[Page 22]]

    (6) Implementation of floodplain management aspects of the National 
Flood Insurance Program;
    (7) Management of training and field exercises; and
    (8) Technical assistance to Federal agencies, State and local 
governments, and voluntary and other private organizations regarding 
emergency response planning, preparedness, mitigation, response, and 
recovery.
    (c) Delegated authorities. In general, Regional Directors are 
authorized, within their respective regions, to exercise the duties and 
powers of the Administrators and Associate Directors as set forth in 
Secs. 2.32 through 2.44. However, the authorities of the Earthquake 
Hazards Reduction Act of 1977, as amended, 42 U.S.C. 7701 et seq., are 
not delegated to Regional Directors (except for the authority of 42 
U.S.C. 7704(b)(2)(A)(i), which is delegated). In addition, the 
authorities of the Federal Insurance Administrator as set forth in 
Sec. 2.31 are not delegated to the Regional Directors.

                             Administrations



Sec. 2.31  Federal Insurance Administration.

    (a) Mission. The Federal Insurance Administration markets, issues, 
and services insurance policies under the National Flood Insurance 
Program (NFIP) and the Federal Crime Insurance Program (FCIP), with 
assistance from private insurance companies and servicing contractors.
    (b) Functions. The principal functions of the Federal Insurance 
Administration are:
    (1) Establishment of regulations, policy guidelines, standard 
contracts of insurance, and insurance rates for the NFIP and FCIP;
    (2) Establishment of policy, plans, and procedures for evaluation, 
payment, and review of insurance claims;
    (3) Oversight of servicing contracts for the NFIP and FCIP and the 
issuance and servicing of flood insurance policies by Write-Your-Own 
(WYO) carriers;
    (4) Studies of the costs and feasibility of proposed extensions of 
the National Flood Insurance Program or of the proposed establishment of 
Federal insurance programs for other natural hazards; and
    (5) Administration of the National Flood Insurance Fund and National 
Insurance Development Fund.
    (c) Delegated authorities. The Federal Insurance Administrator is 
authorized to exercise the duties and powers of the Director as set 
forth in section 1-104 of E.O. 12127 insofar as it pertains to the 
marketing, issuance, and servicing of insurance under the NFIP and FCIP.



Sec. 2.32  United States Fire Administration.

    (a) Mission. The United States Fire Administration works to reduce 
deaths, injuries, and property loss caused by fires in the United 
States.
    (b) Functions. The principal functions of the United States Fire 
Administration are:
    (1) Education of the public about fire problems and high fire risk 
behaviors;
    (2) Providing training and technical assistance to fire and 
emergency services providers in incident response, mitigation and 
management;
    (3) Collection and analysis of fire incident information;
    (4) Investigation of technologies, equipment, and strategies for 
fire and emergency services providers;
    (5) Coordination with State and local fire and emergency agencies 
concerning arson investigation and mitigation, use of building and fire 
codes, fire protection and multi-agency cooperation; and
    (6) Management and operation of the National Emergency Training 
Center, Emmitsburg, Maryland.
    (c) Delegated authorities. The United States Fire Administrator is 
authorized to exercise the duties and powers of the Director as set 
forth in section 1-103 of E.O. 12127.

                              Directorates



Sec. 2.41  Mitigation Directorate.

    (a) Mission. The Mitigation Directorate administers programs to 
reduce or eliminate loss of life and property from natural and 
technological hazards.
    (b) Functions. The principal functions of the Mitigation Directorate 
are:

[[Page 23]]

    (1) Identifying and assessing the risks posed by natural and 
technological hazards, except that, on issues of technological risk 
assessment, FEMA will defer to the Agency having primary responsibility 
in the specific area, notably the Nuclear Regulatory Commission (NRC) 
regarding accidents at commercial nuclear power plants, and the United 
States Army regarding chemical weapons;
    (2) Developing mitigation policies and strategies for implementing 
programs designed to reduce or eliminate loss of life and property from 
natural and technological hazards;
    (3) Coordinating with other Federal agencies and the scientific 
community on matters that will enhance FEMA'S ability to reduce or 
eliminate loss of life and property from natural and technological 
hazards;
    (4) Transferring information on the risks posed by natural and 
technological hazards to other Federal agencies and State and local 
government officials, and the public;
    (5) Promoting a multi-hazard approach to mitigation at State and 
local levels;
    (6) Coordinating with national associations whose membership, 
expertise, and standard-setting capabilities enhance the reduction of 
risks associated with natural and technological hazards;
    (7) Providing for the dissemination of information and delivery of 
technical assistance to build mitigation capabilities and promote 
mitigation activities;
    (8) Carrying out hazard mitigation activities of the Stafford Act, 
including the processing of applications for hazard mitigation grants, 
disbursement of funds under section 404 of the Stafford Act, and 
administrative responsibilities in support of these activities;
    (9) Management of Comprehensive Cooperative Agreements with the 
States, through which the Mitigation programs are implemented in the 
regions; and
    (10) Establishment of Agency Geographic Information Systems (GIS) 
requirements and an Agency-wide GIS policy.
    (c) Delegated authorities. The Associate Director for Mitigation is 
authorized to exercise the duties and powers of the Director as set 
forth in:
    (1) 33 U.S.C. 467h, 709b, insofar as it pertains to the Dam 
Inspection Program;
    (2) Section 1-104 of E.O. 12127 insofar as it pertains to:
    (i) Determining the eligibility of communities to participate in the 
National Flood Insurance Program;
    (ii) Identification of flood-prone areas;
    (iii) Determination of inclusion or non-inclusion of properties 
within the Coastal Barrier Resources System established by 16 U.S.C. 
3503 or within an otherwise protected area;
    (iv) Determination of projected flood elevations for State and local 
governments to use in adopting flood plain management laws, regulations 
or ordinances;
    (v) Establishment of criteria for land management and use, flood 
control, flood zoning, and flood damage protection; and
    (vi) Purchase of properties insured under the National Flood 
Insurance Program that have been damaged substantially beyond repair by 
flood;
    (3) E.O. 11988;
    (4) The following sections of E.O. 12148, as amended:
    (i) Section 4-203, insofar as it pertains to hurricane preparedness, 
as set forth in section 201 of the Robert T. Stafford Disaster Relief 
and Emergency Assistance Act, 42 U.S.C. 5131;
    (ii) Section 4-203, insofar as it pertains to hazard mitigation set 
forth in sections 404, 406, 409, and 411 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5170, 5172, 
5176, and 5178;
    (iii) Section 4-204, pertaining to earthquake hazards reduction as 
set forth in the Earthquake Hazards Reduction Act of 1977, as amended, 
42 U.S.C. 7701-7706; and
    (5) E.O. 12699.



Sec. 2.42  Preparedness, Training, and Exercises Directorate.

    (a) Mission. The Preparedness, Training, and Exercises Directorate 
supports the emergency preparedness, training, and exercises 
capabilities of Federal, State and local governments.

[[Page 24]]

    (b) Functions. The principal functions of the Preparedness, 
Training, and Exercises Directorate are:
    (1) Management of programs to establish, maintain, and enhance the 
capabilities of Federal, State, and local governments to prepare for, 
respond to, recover from a broad range of emergencies, including such 
programs as the Radiological Emergency Preparedness (REP) Program, 
Chemical Stockpile Emergency Preparedness Program (CSEPP), and the 
delegated responsibilities under the Federal Civil Defense Act of 1950, 
as amended (50 U.S.C. App. 2251-2303);
    (2) Management of Comprehensive Cooperative Agreements with the 
States, through which agreements the above programs are implemented in 
the regions;
    (3) Training of Federal, State, and local government employees to 
prepare for, respond to, recover from a broad range of emergencies;
    (4) Testing of Federal, State, and local emergency preparedness and 
response procedures through a comprehensive exercise, evaluation and 
corrective action program; and
    (5) Recommendation of policy for all-hazard emergency preparedness 
and provision of implementation guidance, as required by statute, 
international agreement, or executive order.
    (c) Delegated authorities. The Associate Director for Preparedness, 
Training, and Exercises Directorate is authorized to exercise the duties 
and powers of the Director as set forth in:
    (1) E.O. 10480, as amended;
    (2) E.O. 11179, as amended;
    (3) Sections 1-103(b) and 1-105, E.O. 12127;
    (4) Section 1-101, E.O. 12148;
    (5) E.O. 12241;
    (6) E.O. 12656, other than section 202;
    (7) E.O. 12657; and
    (8) E.O. 12742.



Sec. 2.43  Response and Recovery Directorate.

    (a) Mission. The Response and Recovery Directorate maintains an 
integrated operational capability to respond to and recover from the 
consequences of a disaster, regardless of its cause, in cooperation with 
other Federal agencies, State and local governments, volunteer 
organizations, and the private sector.
    (b) Functions. The principal functions of the Response and Recovery 
Directorate are:
    (1) Management of Disaster Assistance, including damage assessment, 
recommendations to the President on declaration of disasters or 
emergencies under the Robert T. Stafford Disaster Relief and Emergency 
Assistance (Stafford) Act, 42 U.S.C. 5121-5201, processing of 
applications for disaster assistance and disbursement of federal 
disaster assistance funds, except for hazard mitigation assistance 
provided under section 404 of the Stafford Act, 42 U.S.C. 5170c.
    (2) Coordination among Federal agencies, State and local 
governments, and the American Red Cross of the ongoing development and 
the implementation of the Federal Response Plan (for implementation of 
Pub. L. 93-288, as amended) and associated plans for response to and 
recovery from a broad range of disasters;
    (3) Support of communications and Automated Data Processing (ADP) 
capabilities for interagency operations during a wide range of 
emergencies; and
    (4) Maintaining the continuity of essential functions of the Federal 
Government during a wide range of emergencies.
    (c) Delegated authorities. The Associate Director for Response and 
Recovery is authorized to exercise the duties and powers of the Director 
as set forth in:
    (1) Sections 2-102 and 4-203, Executive Order 12148, as amended, 
except insofar as they pertain to hazard mitigation assistance; and
    (2) Section 202, Executive Order 12656.



Sec. 2.44  Operations Support Directorate.

    (a) Mission. The Operations Support Directorate provides direct 
support and services to FEMA's all-hazards emergency management program 
of mitigation, preparedness, response and recovery.
    (b) Functions. The principal functions of the Operations Support 
Directorate are:
    (1) Services primarily for the support of internal functions, 
including:

[[Page 25]]

    (i) Management and oversight of the Agency's procurement system, 
including acquisition of supplies and services;
    (ii) Printing and publications;
    (iii) Telecommunications operations;
    (iv) Automated data processing;
    (v) Software design and engineering;
    (vi) Records management;
    (vii) Agency-wide logistics and property management;
    (viii) Protection of personnel, facilities, and equipment;
    (ix) Management of transit subsidies;
    (x) Preparation of visual presentations materials;
    (xi) Placement of advertisements in general circulation newspapers; 
and
    (2) Services that support organizations outside of FEMA as well as 
the agency itself, including:
    (i) Telecommunications design and engineering;
    (ii) Resource and economic modeling;
    (iii) Management of data storage and production associated with 
Geographic Information Systems (GIS) and other analytic systems;
    (iv) Security of classified records;
    (v) Security of classified communications;
    (vi) Background investigations for the granting of security 
clearances;
    (vii) Determination of suitability for employment under 5 CFR part 
731; and
    (viii) Control of public information collections.
    (c) Delegated authorities. Subject to the qualifications of 
paragraph (d) of this section, the Associate Director for Operations 
Support is authorized to exercise the duties and powers of the Director 
as set forth in:
    (1) E.O. 10450, as amended;
    (2) E.O. 12046, as amended;
    (3) E.O. 12356; and
    (4) E.O. 12472.
    (d) Authorities delegated directly to the Director, Acquisition 
Services Division. The Director, Acquisition Services Division, 
Operations Support Directorate, is authorized to:
    (1)(i) Exercise authority under section 104(h) of the Comprehensive 
Environmental Response, Compensation and Liability Act of 1980 delegated 
to the Director by section 2(f) of Executive Order 12316;
    (ii) Exercise authority of the Director concerning extraordinary 
contractual actions under paragraph 21 of Executive Order 10789.
    (iii) Exercise authority delegated to the Director by Executive 
Order 12352 and act as procurement executive.
    (2)(i) Make purchases and contracts by advertising for equipment and 
supplies, administrative equipment, office supplies, professional 
services, transportation of persons and property, and nonpersonal 
services, and determine that the rejection of any bid is in the public 
interest;
    (ii) Negotiate purchases and contracts for equipment and supplies, 
professional services, transportation of persons and property, and non-
personal services without advertising; and make and issue determinations 
related thereto pursuant to section 302(c) (1)-(b)(10)(10), (14) and 
(15) of the Federal Property and Administrative Services Act of 1949 (41 
U.S.C. 252(c) (1)-(10), (14) and (15)) and 40 U.S.C. 541-544 with 
respect to contracting for services of Architects Engineers;
    (iii) Enter into and administer interagency agreements under the 
Economy Act or any other such agreement involving obligation of funds;
    (3) Notwithstanding any general delegation of statutory authority in 
this part to another officer of FEMA, if the authority delegated in the 
general statutory delegation contains procurement authority that 
authority is delegated solely to the Director, Acquisition Services 
Division, with authority to redelegate to any employee of FEMA. As used 
in this paragraph (d) the term ``procurement'' includes acquisition from 
a recipient including a State or local government, of property or 
services for the direct benefit or use of the Federal Government. This 
includes authority under section 201(h) of the Federal Civil Defense Act 
but excludes authority under section 1362 of the National Flood 
Insurance Act.
    (4) Notwithstanding any general delegation of authority in this part 
to another officer of FEMA, other than the delegation to Regional 
Directors under Sec. 2.22, if the authority delegated contains authority 
to award discretionary grants that authority is delegated to the 
Director, Acquisition Services Division, who is authorized to exercise

[[Page 26]]

the authority of the Director with respect thereto. The Director, 
Acquisition Services Division, may redelegate this authority to any 
employee of FEMA. Discretionary grants include those instruments that 
are awarded to a selected or limited number of recipients deemed best 
qualified based upon criteria designed for the conduct of a specific 
project. This can include governments. Discretionary grants do not 
include those awarded to recipients for which:
    (i) The recipient or class of recipient is mandated by legislation 
or regulation;
    (ii) The amount of the instrument or the amount of the program is 
established by legislation and discretion in the award process is 
limited; or
    (iii) There is no choice in the purpose of the award or whether to 
make the award. The delegation to the Regional Directors under Sec. 2.22 
to implement various programs is not affected by this delegation to the 
Director, Acquisition Services Division.



                          Subpart B  [Reserved]



                     Subpart C--OMB Control Numbers



Sec. 2.80  Purpose.

    The purpose of this subpart is to display OMB control numbers 
assigned to FEMA's information collection requirements.



Sec. 2.81  OMB control numbers assigned to information collections.

    This section collects and displays the control numbers assigned to 
information collection requirements of FEMA by OMB pursuant to the 
Paperwork Reduction Act of 1980. FEMA intends that this section comply 
with the requirements of section 3507(f) of the Paperwork Reduction Act, 
which requires that agencies display a current control number assigned 
by the Director of the Office of Management and Budget for each agency 
information collection requirement.

                                                                        
------------------------------------------------------------------------
                                                             Current OMB
                                                             control No.
------------------------------------------------------------------------
44 CFR part or section where identified or described:                   
  7 subpart E..............................................    3067-0177
  11.36....................................................    3067-0122
  11.54....................................................    3067-0122
  11 subpart D.............................................    3067-0167
  59.22(a).................................................    3067-0020
  59.22(b)(2)..............................................    3067-0018
  60.3, 60.4, 60.5.........................................    3067-0022
  61, 61 app. A(1), 61 app. B..............................    3067-0022
  62 subpart C, 62 app. A, 62 app. B.......................    3067-0169
  63 subpart B.............................................    3067-0196
  64.3(c)..................................................    3067-0020
  65.......................................................    3067-0147
  66, 67...................................................    3067-0148
  70.......................................................    3067-0147
  71.......................................................    3067-0120
  75 subpart B.............................................    3067-0127
  80, 81, 83...............................................    3067-0031
  151 subpart B............................................    3067-0141
  205.33...................................................    3067-0113
  205.34...................................................    3067-0113
  205.52(e)................................................    3067-0009
  205.54(e)................................................    3067-0146
  205.54(f), 205.54(j).....................................    3067-0163
  205.59...................................................    3067-0166
  205.94...................................................    3067-0034
  205.96...................................................    3067-0026
  205 subpart G............................................    3067-0066
  205.116..................................................    3067-0151
  205.200(b)...............................................    3067-0048
  205.207..................................................    3067-0048
  205.208..................................................    3067-0048
  206.35...................................................    3067-0113
  206.36...................................................    3067-0113
  206.101(e)...............................................    3067-0009
  206.131(e)...............................................    3067-0146
  206.131(f), 206.131(j)...................................    3067-0163
  206.171..................................................    3067-0166
  206.202(c)...............................................    3067-0033
  206.204..................................................    3067-0151
  206.364..................................................    3067-0034
  206.366..................................................    3067-0026
  206 subpart L............................................    3067-0066
  206.436..................................................    3067-0207
  206.437..................................................    3067-0208
  206.405..................................................    3067-0212
  220.6....................................................    3067-0168
  220.19...................................................    3067-0156
  221.8....................................................    3067-0156
  222.5, 222.6.............................................    3067-0184
  302.3(a), 302.3(d).......................................    3067-0138
  302.3(b).................................................    3067-0123
  302.3(c)(1)..............................................    3067-0096
  302.3(c)(3)..............................................    3067-0090
  308.7....................................................    3067-0074
  352.4....................................................    3067-0201
  352.24...................................................    3067-0201
  360.4(c).................................................    3067-0100
48 CFR part or section where identified or described:                   
  4452.226-01(a)...........................................    3067-0213
------------------------------------------------------------------------



PART 3  [RESERVED]






PART 4--INTERGOVERNMENTAL REVIEW OF FEDERAL EMERGENCY MANAGEMENT AGENCY (FEMA) PROGRAMS AND ACTIVITIES--Table of Contents




Sec.

[[Page 27]]

4.1  What is the purpose of these regulations?
4.2  What definitions apply to these regulations?
4.3  What programs and activities of FEMA are subject to these 
          regulations?
4.4  [Reserved]
4.5  What is the Director's obligation with respect to Federal 
          interagency coordination?
4.6  What procedures apply to the selection of programs and activities 
          under these regulations?
4.7  How does the Director communicate with State and local officials 
          concerning FEMA's programs and activities?
4.8  How does the Director provide an opportunity to comment on proposed 
          Federal financial assistance and direct Federal development?
4.9  How does the Director receive and respond to comments?
4.10  How does the Director make efforts to accommodate 
          intergovernmental concerns?
4.11  What are the Director's obligations in interstate situations?
4.12  How may a State simplify, consolidate, or substitute federally 
          required State plans?
4.13  May the Director waive any provision of these regulations?

    Authority: E.O. 12372, July 14, 1982 (47 FR 30959), as amended April 
8, 1983 (48 FR 15887); sec. 401, Intergovernmental Cooperation Act of 
1968, as amended (31 U.S.C. 6506); sec. 204, Demonstration Cities and 
Metropolitan Development Act of 1966, as amended (42 U.S.C. 3334).

    Source: 48 FR 29316, June 24, 1983, unless otherwise noted.

    Editorial Note: For additional information, see related documents 
published at 47 FR 57369, Dec. 23, 1982; 48 FR 17101, Apr. 21, 1983; and 
48 FR 29096, June 24, 1983.



Sec. 4.1  What is the purpose of these regulations?

    (a) The regulations in this part implement Executive Order 12372, 
``Intergovernmental Review of Federal Programs,'' issued July 14, 1982 
and amended on April 8, 1983. These regulations also implement 
applicable provisions of section 401 of the Intergovernmental 
Cooperation Act of 1968 and section 204 of the Demonstration Cities and 
Metropolitan Development Act of 1966.
    (b) These regulations are intended to foster an intergovernmental 
partnership and a strengthened Federalism by relying on state processes 
and on State, areawide, regional and local coordination for review of 
proposed Federal financial assistance and direct Federal development.
    (c) These regulations are intended to aid the internal management of 
FEMA, and are not intended to create any right or benefit enforceable at 
law by a party against FEMA or its officers.



Sec. 4.2  What definitions apply to these regulations?

    FEMA means the Federal Emergency Management Agency.
    Order means Executive Order 12372, issued July 14, 1982, and amended 
April 8, 1983 and titled ``Intergovernmental Review of Federal 
Programs.''
    Director means the Director of FEMA or an official or employee of 
FEMA acting for the Director under a delegation of authority.
    State means any of the 50 states, the District of Columbia, the 
Commonwealth of Puerto Rico, the Commonwealth of Northern Mariana 
Islands, Guam, American Samoa, the U.S. Virgin Islands, or the Trust 
Territory of the Pacific Islands.



Sec. 4.3  What programs and activities of FEMA are subject to these regulations?

    The Director publishes in the Federal Register a list of FEMA's 
programs and activities that are subject to these regulations and 
identifies which of these are subject to the requirements of section 204 
of the Demonstration Cities and Metropolitan Development Act.



Sec. 4.4  [Reserved]



Sec. 4.5  What is the Director's obligation with respect to Federal interagency coordination?

    The Director, to the extent practicable, consults with and seeks 
advice from all other substantially affected Federal departments and 
agencies in an effort to assure full coordination between such agencies 
and FEMA regarding programs and activities covered under these 
regulations.



Sec. 4.6  What procedures apply to the selection of programs and activities under these regulations?

    (a) A State may select any program or activity published in the 
Federal

[[Page 28]]

Register in accordance with Sec. 4.3 of this part for intergovernmental 
review under these regulations. Each State, before selecting programs 
and activities, shall consult with local elected officials.
    (b) Each State that adopts a process shall notify the Director of 
FEMA's programs and activities selected for that process.
    (c) A State may notify the Director of changes in its selections at 
any time. For each change, the State shall submit to the Director an 
assurance that the State has consulted with local elected officials 
regarding the change. FEMA may establish deadlines by which States are 
required to inform the Director of changes in their program selections.
    (d) The Director uses a State's process as soon as feasible, 
depending on individual programs and activities, after the Director is 
notified of its selections.



Sec. 4.7  How does the Director communicate with State and local officials concerning FEMA's programs and activities?

    (a) For those programs and activities covered by a state process 
under Sec. 4.6, the Director, to the extent permitted by law:
    (1) Uses the state process to determine views of State and local 
elected officials; and,
    (2) Communicates with State and local elected officials, through the 
state process, as early in a program planning cycle as is reasonably 
feasible to explain specific plans and actions.
    (b) The Director provides notice to directly affected State, 
areawide, regional, and local entities in a State of proposed Federal 
financial assistance or direct Federal development if:
    (1) The State has not adopted a process under the Order; or
    (2) The assistance or development involves a program or activity not 
selected for the State process.

This notice may be made by publication in the Federal Register or other 
appropriate means, which FEMA in its discretion deems appropriate.



Sec. 4.8  How does the Director provide an opportunity to comment on proposed Federal financial assistance and direct Federal development?

    (a) Except in unusual circumstances, the Director gives state 
processes or directly affected State, areawide, regional and local 
officials and entities at least 60 days from the date established by the 
Director to comment on proposed direct Federal development or Federal 
financial assistance.
    (b) This section also applies to comments in cases in which the 
review, coordination, and communication with FEMA have been delegated.
    (c) Applicants for programs and activities subject to section 204 of 
the Demonstration Cities and Metropolitan Act shall allow areawide 
agencies a 60-day opportunity for review and comment.



Sec. 4.9  How does the Director receive and respond to comments?

    (a) The Director follows the procedures in Sec. 4.10 if:
    (1) A State office or official is designated to act as a single 
point of contact between a state process and all federal agencies, and
    (2) That office or official transmits a state process recommendation 
for a program selected under Sec. 4.6.
    (b)(1) The single point of contact is not obligated to transmit 
comments from State, areawide, regional or local officials and entities 
where there is no state process recommendation.
    (2) If a state process recommendation is transmitted by a single 
point of contact, all comments from state, areawide, regional, and local 
officials and entities that differ from it must also be transmitted.
    (c) If a State has not established a process, or is unable to submit 
a state process recommendation, State, areawide, regional and local 
officials and entities may submit comments to FEMA.
    (d) If a program or activity is not selected for a state process, 
State, areawide, regional and local officials and entities may submit 
comments to FEMA. In addition, if a state process recommendation for a 
nonselected program or activity is transmitted to FEMA by the single 
point of contact,

[[Page 29]]

the Director follows the procedures of Sec. 4.10 of this part.
    (e) The Director considers comments which do not constitute a state 
process recommendation submitted under these regulations and for which 
the Director is not required to apply the procedures of Sec. 4.10 of 
this part, when such comments are provided by a single point of contact, 
by the applicant or directly to FEMA by a commenting party.



Sec. 4.10  How does the Director make efforts to accommodate intergovernmental concerns?

    (a) If a state process provides a state process recommendation to 
FEMA through its single point of contact, the Director either:
    (1) Accepts the recommendation;
    (2) Reaches a mutually agreeable solution with the state process; or
    (3) Provides the single point of contact with such written 
explanation of the decision, as the Director in his or her discretion 
deems appropriate. The Director may also supplement the written 
explanation by providing the explanation to the single point of contact 
by telephone, other telecommunication, or other means.
    (b) In any explanation under paragraph (a)(3) of this section, the 
Director informs the single point of contact that:
    (1) FEMA will not implement its decision for at least ten days after 
the single point of contact receives the explanation; or
    (2) The Director has reviewed the decision and determined that, 
because of unusual circumstances, the waiting period of at least ten 
days is not feasible.
    (c) For purposes of computing the waiting period under paragraph 
(b)(1) of this section, a single point of contact is presumed to have 
received written notification 5 days after the date of mailing of such 
notification.



Sec. 4.11  What are the Director's obligations in interstate situations?

    (a) The Director is responsible for:
    (1) Identifying proposed Federal financial assistance and direct 
Federal development that have an impact on interstate areas;
    (2) Notifying appropriate officials and entities in states which 
have adopted a process and which select FEMA's program or activity;
    (3) Making efforts to identify and notify the affected State, 
areawide, regional, and local officials and entities in those States 
that have not adopted a process under the Order or do not select FEMA's 
progam or activity;
    (4) Responding pursuant to Sec. 4.10 of this part if the Director 
receives a recommendation from a designated areawide agency transmitted 
by a single point of contact, in cases in which the review, 
coordination, and communication with FEMA have been delegated.
    (b) The Director uses the procedures in Sec. 4.10 if a state process 
provides a state process recommendation to FEMA through a single point 
of contact.



Sec. 4.12  How may a State simplify, consolidate, or substitute federally required State plans?

    (a) As used in this section:
    (1) Simplify means that a State may develop its own format, choose 
its own submission date, and select the planning period for a State 
plan.
    (2) Consolidate means that a State may meet statutory and regulatory 
requirements by combining two or more plans into one document and that 
the State can select the format, submission date, and planning period 
for the consolidated plan.
    (3) Substitute means that a State may use a plan or other document 
that it has developed for its own purposes to meet Federal requirements.
    (b) If not inconsistent with law, a State may decide to try to 
simplify, consolidate, or substitute federally required state plans 
without prior approval by the Director.
    (c) The Director reviews each state plan that a State has 
simplified, consolidated, or substituted and accepts the plan only if 
its contents meet Federal requirements.



Sec. 4.13  May the Director waive any provision of these regulations?

    In an emergency, the Director may waive any provision of these 
regulations.

[[Page 30]]



PART 5--PRODUCTION OR DISCLOSURE OF INFORMATION--Table of Contents




                      Subpart A--General Provisions

Sec.
5.1  Scope and purposes of part.
5.2  Application.
5.3  Definitions.
5.4  Availability of records.
5.5  Exemptions.
5.6  Congressional information.
5.7  Records of other agencies.
5.8  Records involved in litigation or other judicial process.
5.9  Inconsistent issuances of FEMA and its predecessor agencies 
          superseded.

Subpart B--Publication of or Availability of General Agency Information, 
              Rules, Orders, Policies, and Similar Material

5.20  Publication of rules and general policies.
5.21  Effect of failure to publish.
5.22  Coordination of publication.
5.23  Incorporation by reference.
5.24  Availability of opinions, orders, policies, interpretations, 
          manuals, and instructions.
5.25  Available materials.
5.26  Rules for public inspection and copying.
5.27  Deletion of identifying details.
5.28  Indexes.
5.29  Effect of failure to make information materials available.

                             Subpart C--Fees

5.40  Copies of FEMA records available at a fee.
5.41  FEMA publications.
5.42  Fees to be charged--categories of requesters.
5.43  Waiver or reduction of fees.
5.44  Prepayment of fees.
5.45  Form of payment.
5.46  Fee schedule.
5.47  Appeals regarding fees.

                      Subpart D--Described Records

5.50  General.
5.51  Submission of requests for described records.
5.52  Review of requests.
5.53  Approval of request.
5.54  Denial of request of records.
5.55  Appeal within FEMA of denial of request.
5.56  Extension of time limits.
5.57  Predisclosure notification procedures for confidential commercial 
          information.
5.58  Exhaustion of administrative remedies.
5.59  Judicial relief available to the public.
5.60  Disciplinary action against employees for ``arbitrary or 
          capricious'' denial.
5.61  Contempt for noncompliance.

                          Subpart E--Exemptions

5.70  General.
5.71  Categories of records exempt from disclosure under 5 U.S.C. 552.
5.72  Executive privilege exemption.

    Subpart F--Subpoenas or Other Legal Demands for Testimony or the 
        Production or Disclosure of Records or Other Information

5.80  Scope and applicability.
5.81  Statement of policy.
5.82  Definitions.
5.83  Authority to accept service of subpoenas.
5.84  Production of documents in private litigation.
5.85  Authentication and attestation of copies.
5.86  Production of documents in litigation or other adjudicatory 
          proceeding in which the United States is a party.
5.87  Testimony of FEMA employees in private litigation.
5.88  Testimony in litigation in which the United States is a party.
5.89  Waiver.

    Authority: 5 U.S.C. 552 as amended by sections 1801-1804 of the 
Omnibus Anti-Drug Abuse Act of 1986 which contains the Freedom of 
Information Reform Act of 1986 (Pub. L. 99-570); 5 U.S.C. 301 (Pub. L. 
85-619); Reorganization Plan No. 3 of 1978; E.O. 12127; and E.O. 12148.

    Source: 44 FR 50287, Aug. 27, 1979, unless otherwise noted.



                      Subpart A--General Provisions



Sec. 5.1  Scope and purposes of part.

    This part sets forth policies and procedures concerning the 
availability of and disclosure of records and information held by the 
Federal Emergency Management Agency (FEMA) in accordance with 5 U.S.C. 
552, popularly known as the ``Freedom of Information Act,'' (FOIA).



Sec. 5.2  Application.

    This part applies to all records and information materials 
generated, developed, or held by FEMA at Headquarters, in Regions, or in 
the field, or any component thereof.

[[Page 31]]



Sec. 5.3  Definitions.

    For purposes of this part, the following terms have the meanings 
ascribed to them in this section:
    (a) Records. Records means all books, papers, maps, photographs, or 
other documentary materials, regardless of physical form or 
characteristics made or received by FEMA in pursuance of Federal Law or 
in connection with the transaction of public business and preserved, or 
appropriate for preservation, as evidence of the organization, 
functions, policies, decisions, procedures, operations, or other 
activities of FEMA or because of the information value of data contained 
therein. The term does not include:
    (1) Material made or acquired and preserved solely for reference or 
exhibition purposes, extra copies of documents preserved only for 
convenience of reference, and stocks of publications and of processed 
documents; or
    (2) Objects or articles, such as structures, furniture, paintings, 
sculpture, models, vehicles or equipment; or
    (3) Formulae, designs, drawings, research data, computer programs, 
technical data packages, and the like, which are not considered records 
within the Congressional intent of reference because of development 
costs, utilization, or value. These items are considered exploitable 
resources to be utilized in the best interest of all the public and are 
not preserved for informational value nor as evidence of agency 
functions. Requests for copies of such material shall be evaluated in 
accordance with policies expressly directed to the appropriate 
dissemination or use of these resources. Requests to inspect this 
material to determine its content for informational purposes shall 
normally be granted, unless inspection is inconsistent with the 
obligation to protect the property value of the material, as, for 
example, may be true for patent information and certain formulae, or is 
inconsistent with another significant and legitimate governmental 
purpose.
    (b) Reasonably Described. Reasonably described, when applied to a 
request record, means identifying it to the extent that it will permit 
the location of the particular document with a reasonable effort.
    (c) Agency. Agency, as defined in section 552(e) of title 5 U.S.C., 
includes any executive department, military department, government 
corporation, or other establishment in the executive branch of the 
Government (including the Executive Office of the President), or any 
independent regulatory agency.
    (d) Headquarters FOIA Officer. The FOIA/Privacy Act Specialist or 
his/her designee.
    (e) Regional FOIA Officer. The Regional Director, or his/her 
designee.

[44 FR 50287, Aug. 27, 1979, as amended at 45 FR 1421, Jan. 7, 1980; 51 
FR 34604, Sept. 30, 1986]



Sec. 5.4  Availability of records.

    (a) FEMA records are available to the greatest extent possible in 
keeping with the spirit and intent of FOIA and will be furnished 
promptly to any member of the public upon request addressed to the 
office designated in Sec. 5.26. The person making the request need not 
have a particular interest in the subject matter, nor must he provide 
justification for the request.
    (b) The requirement of 5 U.S.C. 552 that records be available to the 
public refers only to records in being at the time the request for them 
is made. FOIA imposes no obligation to compile a record in response to a 
request.



Sec. 5.5  Exemptions.

    Requests for FEMA records may be denied if disclosure is exempted 
under the provisions of 5 U.S.C. 552, as outlined in subpart E. Usually, 
except when a record is classified, or when disclosure would violate any 
other Federal statute, the authority to withhold a record from 
disclosure is permissive rather than mandatory. The authority for 
nondisclosure will not be invoked unless there is compelling reason to 
do so.



Sec. 5.6  Congressional information.

    Nothing in this part authorizes withholding information from the 
Congress except when executive privilege is invoked by the President.



Sec. 5.7  Records of other agencies.

    If a request is submitted to FEMA to make available current records 
which

[[Page 32]]

are the primary responsibility of another agency, FEMA will refer the 
request to the agency concerned for appropriate action. FEMA will advise 
the requester that the request has been forwarded to the responsible 
agency.



Sec. 5.8  Records involved in litigation or other judicial process.

    Where there is reason to believe that any records requested may be 
involved in litigation or other judicial process in which the United 
States is a party, including discovery procedures pursuant to the 
Federal Rules of Civil Procedure or Federal Rules of Criminal Procedure, 
the request shall be referred to the General Counsel.



Sec. 5.9  Inconsistent issuances of FEMA and its predecessor agencies superseded.

    Policies and procedures of any of FEMA's predecessor agencies 
inconsistent with this regulation are superseded to the extent of that 
inconsistency.



Subpart B--Publication of or Availability of General Agency Information, 
              Rules, Orders, Policies, and Similar Material



Sec. 5.20  Publication of rules and general policies.

    In accordance with 5 U.S.C. 552(a)(1), there are separately stated 
and currently published, or from time to time there will be published, 
in the Federal Register for the guidance of the public, the following 
general information concerning FEMA:
    (a) Description of the organization of the Headquarters Office and 
regional and other offices and the established places at which, the 
employees from whom, and the methods whereby the public may obtain 
information, make submittals or requests, or obtain decisions.
    (b) Statement of the general course and method by which FEMA 
functions are channeled and determined, including the nature and 
requirements of all formal and informal procedures available.
    (c) Rules of procedure, descriptions of forms available or the 
places at which forms may be obtained, and instructions as to the scope 
and contents of all papers, reports, or examinations.
    (d) Substantive rules of general applicability adopted as authorized 
by law, and statements of general policy or interpretations of general 
applicability formulated and adopted by FEMA.
    (e) Each amendment, revision, or repeal of the materials described 
in this section. Much of this information will also be codified in this 
subchapter A.



Sec. 5.21  Effect of failure to publish.

    5 U.S.C. 552(a)(1) provides that, except to the extent that a person 
has actual and timely notice of the terms thereof, a person may not in 
any manner be required to resort to, or to be adversely affected by, a 
matter required to be published in the Federal Register and not so 
published.



Sec. 5.22  Coordination of publication.

    The General Counsel, FEMA, is responsible for coordination of FEMA 
materials required to be published in the Federal Register.



Sec. 5.23  Incorporation by reference.

    When deemed appropriate, matter covered by this subpart, which is 
reasonably available to the class of persons affected thereby may be 
incorporated by reference in the Federal Register in accordance with 
standards prescribed from time to time by the Director of the Federal 
Register (see 1 CFR part 51).



Sec. 5.24  Availability of opinions, orders, policies, interpretations, manuals, and instructions.

    FEMA will make available for public inspection and copying the 
material described in 5 U.S.C. 552(a)(2) as enumerated in Sec. 5.25 and 
an index of those materials as described in Sec. 5.28, at convenient 
places and times.



Sec. 5.25  Available materials.

    FEMA materials which are available under this subpart are as 
follows:
    (a) Final opinions and orders made in the adjudication of cases.
    (b) Those statements of policy and interpretations which have been 
adopted by FEMA and are not published in the Federal Register.

[[Page 33]]

    (c) Administrative staff manuals and instructions to staff that 
affect a member of the public, unless such materials are promptly 
published and copies offered for sale.



Sec. 5.26  Rules for public inspection and copying.

    (a) Location. Materials are available for public inspection and 
copying at the following locations:
    (1) Headquarters:

Federal Center Plaza, 500 C Street, SW, Washington, DC 20472

    (2) Regional Offices

Region I, Room 442, J. W. McCormack Post Office & Court House, 
Boston, MA 02109;
Region II, 26 Federal Plaza, New York, NY 10278;
Region III, Liberty Square Bldg. (Second Floor), 105 South Seventh 
Street, Philadephia, PA 19106;
Region IV, 1371 Peachtree Street, N.E., 7th Floor, Atlanta, GA 30309;
Region V, 300 South Wacker Drive, 24th Floor, Chicago, IL 60606;
Region VI, Federal Regional Center, Denton, TX 76201;
Region VII, 911 Walnut Street, Room 300, Kansas City, MO 64106;
Region VIII, Denver Federal Center, Bldg. 710, Denver, CO 80225-0267;
Region XI, Building 105, Presidio of San Francisco, CA 94129;
Region X, Federal Regional Center, 130-228th Street, SW., Bothell, WA 
98021-9796.

    (b) Time. Materials will be made available for public inspection and 
copying during the normal hours of business.
    (c) FEMA will furnish reasonable copying services at fees specified 
in subpart C. Such reproduction services as are required will be 
arranged by the Office of Administrative Support in the headquarters or 
by regional offices as appropriate.
    (d) Handling of materials. The unlawful removal or mutilation of 
materials is forbidden by law and is punishable by fine or imprisonment 
or both. FEMA personnel making materials available will ensure that all 
materials provided for inspection and copying are returned in the same 
condition as provided.

[44 FR 50287, Aug. 27, 1979, as amended at 47 FR 13149, Mar. 29, 1982; 
48 FR 44542, Sept. 29, 1983; 50 FR 40006, Oct. 1, 1985]



Sec. 5.27  Deletion of identifying details.

    To the extent required to prevent a clearly unwarranted invasion of 
personal privacy, FEMA may delete identifying details when making 
available or publishing an opinion, statement of policy, interpretation, 
or staff manual or instruction. However, the justification for each 
deletion will be explained fully in writing, and will require the 
concurrence of the General Counsel. A copy of the justification will be 
attached to the material containing the deletion and a copy will also be 
furnished to the Headquarters FOIA Officer or appropriate Regional 
Director.



Sec. 5.28  Indexes.

    FEMA will maintain and make available for public inspection and 
copying current indexes arranged by subject matter providing identifying 
information for the public regarding any matter issued, adopted, or 
promulgated after July 4, 1967, and described in Sec. 5.25. FEMA will 
publish quarterly and make available copies of each index or supplements 
thereto. The indexes will be maintained for public inspection at the 
location described in Sec. 5.26.



Sec. 5.29  Effect of failure to make information materials available.

    Materials requested to be made available pursuant to Sec. 5.24 that 
affect a member of the public may be relied upon, used, or cited as 
precedent by FEMA against any private party only if (a) they have been 
indexed and either made available or published as required by 5 U.S.C. 
552(a)(2), or (b) the private party has actual and timely notice of 
their terms.



                             Subpart C--Fees



Sec. 5.40  Copies of FEMA records available at a fee.

    One copy of FEMA records not available free of charge will be 
provided at a fee as provided in Sec. 5.46. A reasonable number of 
additional copies will be provided for the applicable fee where 
reproduction services are not readily obtainable from private commercial 
sources.

[[Page 34]]



Sec. 5.41  FEMA publications.

    Anyone may obtain FEMA publications without charge from the FEMA 
Headquarters, Regional Offices and from FEMA, P.O. Box 8181, Washington, 
DC 20024 in accordance with standard operating procedures, including 
limitation on numbers of specific individual publications. FEMA Films 
may be obtained on loan or certain of these films may be purchased, in 
which case fees will be charged as set out in a FEMA catalogue. Non-
exempt FEMA research reports are available from the National Technical 
Information Service, United States Department of Commerce, which 
establishes its own fee schedule. Charges, if any, for these items and 
similar user charges are established in accordance with other provisions 
of law as, for example, 31 U.S.C. 9701 and are not deemed search and 
duplication charges hereunder.

[44 FR 50287, Aug. 27, 1979, as amended at 48 FR 44542, Sept. 29, 1983; 
50 FR 40006, Oct. 1, 1985]



Sec. 5.42  Fees to be charged--categories of requesters.

    (a) There are four categories of FOIA requesters: Commercial use 
requesters; representatives of news media; educational and noncommercial 
scientific institutions; and all other requesters. The time limits for 
processing requests shall only begin upon receipt of a proper request 
which reasonably identifies records being sought. The Freedom of 
Information Reform Act of 1986 prescribes specific levels of fees for 
each of these categories:
    (1) When records are being requested for commercial use, the fee 
policy of FEMA is to levy full allowable direct cost of searching for, 
reviewing for release, and duplicating the records sought. Commercial 
users are not entitled to two hours of free search time nor 100 free 
pages of reproduction of documents. The full allowable direct cost of 
searching for and reviewing records will be charged even if there is 
ultimately no disclosure of records. Commercial use is defined as a use 
that furthers the commercial, trade or profit interests of the requester 
or person on whose behalf the request is made. In determining whether a 
requester falls within the commercial use category, FEMA will look to 
the use to which a requester will put the documents requested. Where a 
requester does not explain his/her use, or where his/her explanation is 
insufficient to permit a determination of the nature of the use, FEMA 
shall require the requester to provide information regarding the use to 
be made of the information and if the request does not include an 
agreement to pay all appropriate fees, FEMA will process such request 
only up to the $30.00 threshold which is the estimated cost to FEMA to 
collect fees which we are prohibited from charging by law. Requesters 
must reasonably describe the records sought.
    (2) When records are being requested by representatives of the news 
media, the fee policy of FEMA is to levy reproduction charges only, 
excluding charges for the first 100 pages. Representatives of the news 
media refers to any person actively gathering news for an entity that is 
organized and operated to publish or broadcast news to the public. The 
term news means information that is about current events or that would 
be of current interest to the public. Examples of news media entities 
include television or radio stations broadcasting to the public at 
large, and publishers of periodicals (but only in those instances where 
they can qualify as disseminators of ``news'') who make their products 
available for purchase or subscription by the general public. These 
examples are not intended to be all-inclusive. As traditional methods of 
news delivery evolve (i.e., electronic dissemination of newspapers 
through telecommunications services), such alternative media would be 
included in this category. In the case of ``freelance'' journalists, 
they may be regarded as working for a news organization if they can 
demonstrate a solid basis for expecting publication through that 
organization, even though not actually employed by it. For example, a 
publication contract would be the clearest proof, but FEMA may also look 
to the past publication record, press accreditation, guild membership, 
business registration, Federal Communications Commission licensing, or 
similar credentials of a requester in

[[Page 35]]

making this determination. To be eligible for inclusion in this 
category, requesters must meet the criteria specified in this section 
and his or her request must not be made for a commercial use basis as 
that term is defined under paragraph (a)(1) of this section. A request 
for records supporting the news dissemination function of the requester 
shall not be considered to be a request that is for a commercial use. 
Requesters must reasonably describe the records sought.
    (3) When records are being requested by an educational or 
noncommercial scientific institution whose purpose is scholarly or 
scientific research, the fee policy of FEMA is to levy reproduction 
charges only, excluding charges for the first 100 pages. Educational 
institution refers to a preschool, a public or private elementary or 
secondary school, an institution of graduate higher education, an 
institution of undergraduate higher education, an institution of 
professional education and an institution of vocational education, which 
operates a program or programs of scholarly research. Noncommercial 
scientific institution refers to an institution that is not operated on 
a commercial basis as that term is defined under paragraph (a)(1) of 
this section and which is operated solely for the purpose of conducting 
scientific research, the results of which are not intended to promote 
any particular product or industry. To be eligible for inclusion in this 
category, requesters must show that the request is being made under the 
auspices of a qualifying institution and that the records are not sought 
for a commercial use, but are sought in furtherance of scholarly (if the 
request is from an educational institution) or scientific (if the 
request is from a noncommercial scientific institution) research. 
Requesters must reasonably describe the records sought.
    (4) For any other request which does not meet the criteria contained 
in paragraphs (a)(1) through (3) of this section, the fee policy of FEMA 
is to levy full reasonable direct cost of searching for and duplicating 
the records sought, except that the first 100 pages of reproduction and 
the first two hours of search time shall be furnished without charge. 
The first two hours of computer search time is based on the hourly cost 
of operating the central processing unit and the operator's hourly 
salary plus 16 percent. When the cost of the computer search, including 
the operator time and the cost of operating the computer to process the 
request, equals the equivalent dollar amount of two hours of the salary 
of the person performing the search, i.e., the operator, FEMA shall 
begin assessing charges for computer search. Requests from individuals 
requesting records about themselves filed in FEMA's systems of records 
shall continue to be treated under the fee provisions of the Privacy Act 
of 1974 which permit fees only for reproduction. Requesters must 
reasonably describe the records sought.
    (b) Except for requests that are for a commercial use, FEMA may not 
charge for the first two hours of search time or for the first 100 pages 
of reproduction. However, a requester may not file multiple requests at 
the same time, each seeking portions of a document or documents, solely 
in order to avoid payment of fees. When FEMA believes that a requester 
or, on rare occasions, a group of requesters acting in concert, is 
attempting to break a request down into a series of requests for the 
purpose of evading the assessment of fees, FEMA may aggregate any such 
requests and charge accordingly. For example, it would be reasonable to 
presume that multiple requests of this type made within a 30-day period 
had been made to avoid fees. For requests made over a longer period, 
however, FEMA must have a solid basis for determining that aggregation 
is warranted in such cases. Before aggregating requests from more than 
one requester, FEMA must have a concrete basis on which to conclude that 
the requesters are acting in concert and are acting specifically to 
avoid payment of fees. In no case may FEMA aggregate multiple requests 
on unrelated subjects from one requester.
    (c) In accordance with the prohibition of section (4)(A)(iv) of the 
Freedom of Information Act, as amended, FEMA shall not charge fees to 
any requester, including commercial use requesters, if the cost of 
collecting a fee

[[Page 36]]

would be equal to or greater than the fee itself.
    (1) For commercial use requesters, if the direct cost of searching 
for, reviewing for release, and duplicating the records sought would not 
exceed $30.00, FEMA shall not charge the requester any costs.
    (2) For requests from representatives of news media or educational 
and noncommercial scientific institutions, excluding the first 100 pages 
which are provided at no charge, if the duplication cost would not 
exceed $30.00, FEMA shall not charge the requester any costs.
    (3) For all other requests not falling within the category of 
commercial use requests, representatives of news media, or educational 
and noncommercial scientific institutions, if the direct cost of 
searching for and duplicating the records sought, excluding the first 
two hours of search time and first 100 pages which are free of charge, 
would not exceed $30.00, FEMA shall not charge the requester any costs.

[52 FR 13677, Apr. 24, 1987]



Sec. 5.43  Waiver or reduction of fees.

    (a) FEMA may waive all fees or levy a reduced fee when disclosure of 
the information requested is deemed to be in the public interest because 
it is likely to contribute significantly to public understanding of the 
operations or activities of the Federal Government and is not primarily 
in the commercial interest of the requester.
    (b) A fee waiver request shall indicate how the information will be 
used, to whom it will be provided, whether the requester intends to use 
the information for resale at a fee above actual cost, any personal or 
commercial benefits that the requester reasonably expects to receive by 
the disclosure, provide justification to support how release would 
benefit the general public, the requester's and/or intended user's 
identity and qualifications, expertise in the subject area and ability 
and intention to disseminate the information to the public.

[52 FR 13678, Apr. 24, 1987]



Sec. 5.44  Prepayment of fees.

    (a) When FEMA estimates or determines that allowable charges that a 
requester may be required to pay are likely to exceed $250.00, FEMA may 
require a requester to make an advance payment of the entire fee before 
continuing to process the request.
    (b) When a requester has previously failed to pay a fee charged in a 
timely fashion (i.e., within 30 days of the date of the billing), FEMA 
may require the requester to pay the full amount owed plus any 
applicable interest as provided in Sec. 5.46(d), and to make an advance 
payment of the full amount of the estimated fee before the agency begins 
to process a new request or a pending request from that requester.
    (c) When FEMA acts under paragraphs (a) or (b) of this section, the 
administrative time limits prescribed in subsection (a)(6) of the FOIA 
(i.e., 10 working days from the receipt of initial requests and 20 
working days from receipt of appeals from initial denial, plus 
permissible extensions of these time limits) will begin only after FEMA 
has received fee payments described under paragraphs (a) or (b) of this 
section.

[52 FR 13678, Apr. 24, 1987]



Sec. 5.45  Form of payment.

    Payment shall be by check or money order payable to the Federal 
Emergency Management Agency and shall be addressed to the official 
designated by FEMA in correspondence with the requestor or to the 
Headquarters FOIA Officer or Regional FOIA Officer, as appropriate.

[44 FR 50287, Aug. 27, 1979, as amended at 48 FR 44542, Sept. 29, 1983]



Sec. 5.46  Fee schedule.

    (a) Manual searches for records. FEMA will charge at the salary 
rate(s), (i.e., basic hourly pay rate plus 16 percent) of the 
employee(s) conducting the search. FEMA may assess charges for time 
spent searching, even if the agency fails to locate the records or if 
records located are determined to be exempt from disclosure. FEMA may 
assess charges for time spent searching, even if FEMA fails to locate 
the

[[Page 37]]

records or if records located are determined to be exempt from 
disclosure.
    (b) Computer searches for records. FEMA will charge the actual 
direct cost of providing the service. This will include the cost of 
operating the central processing unit (CPU) for that portion of 
operating time that is directly attributable to searching for records 
responsive to a FOIA request and operator/programmer salary 
apportionable to the search. FEMA may assess charges for time spent 
searching, even if FEMA fails to locate the records or if records 
located are determined to be exempt from disclosure.
    (c) Duplication costs. (1) For copies of documents reproduced on a 
standard office copying machine in sizes up to 8\1/2\ x 14 inches, the 
charge will be $.15 per page.
    (2) The fee for reproducing copies of records over 8\1/2\ x 14 
inches or whose physical characteristics do not permit reproduction by 
routine electrostatic copying shall be the direct cost of reproducing 
the records through government or commercial sources. If FEMA estimates 
that the allowable duplication charges are likely to exceed $25, it 
shall notify the requester of the estimated amount of fees, unless the 
requester has indicated in advance his/her willingness to pay fees as 
high as those anticipated. Such a notice shall offer a requester the 
opportunity to confer with agency personnel with the objective of 
reformulating the request to meet his/her needs at a lower cost.
    (3) For copies prepared by computer, such as tapes or printouts, 
FEMA shall charge the actual cost, including operator time, of 
production of the tape or printout. If FEMA estimates that the allowable 
duplication charges are likely to exceed $25, it shall notify the 
requester of the estimated amount of fees, unless the requester has 
indicated in advance his/her willingness to pay fees as high as those 
anticipated. Such a notice shall offer a requester the opportunity to 
confer with agency personnel with the objective of reformulating the 
request to meet his/her needs at a lower cost.
    (4) For other methods of reproduction or duplication, FEMA shall 
charge the actual direct costs of producing the document(s). If FEMA 
estimates that the allowable duplication charges are likely to exceed 
$25, it shall notify the requester of the estimated amount of fees, 
unless the requester has indicated in advance his/her willingness to pay 
fees as high as those anticipated. Such a notice shall offer a requester 
the opportunity to confer with agency personnel with the objective of 
reformulating the request to meet his/her needs at a lower cost.
    (d) Interest may be charged to those requesters who fail to pay fees 
charged. FEMA may begin assessing interest charges on the amount billed 
starting on the 31st day following the day on which the billing was 
sent. Interest will be at the rate prescribed in section 3717 of Title 
31 U.S.C. and will accrue from the date of the billing.
    (e) FEMA shall use the most efficient and least costly methods to 
comply with requests for documents made under the FOIA. FEMA may choose 
to contract with private sector services to locate, reproduce and 
disseminate records in response to FOIA requests when that is the most 
efficient and least costly method. When documents responsive to a 
request are maintained for distribution by agencies operating statutory-
based fee schedule programs, such as but not limited to the Government 
Printing Office or the National Technical Information Service, FEMA will 
inform requesters of the steps necessary to obtain records from those 
sources.

[52 FR 13678, Apr.24, 1987, as amended at 52 FR 33410, Sept. 3, 1987]



Sec. 5.47  Appeals regarding fees.

    A requestor whose application for a fee waiver or a fee reduction is 
denied may appeal that decision to the Deputy Director in the manner 
prescribed in subpart D.



                      Subpart D--Described Records



Sec. 5.50  General.

    (a) Except for records made available pursuant to subpart B, FEMA 
shall promptly make records available to a requestor pursuant to a 
request which

[[Page 38]]

reasonably described such records unless FEMA invokes an exemption 
pursuant to subpart E. Although the burden of reasonable description of 
the records rests with the requestor, FEMA will assist in identification 
to the extent practicable. Where requested records may be involved in 
litigation or other judicial proceedings in which the United States is a 
party, the procedures set forth under Sec. 5.8 shall be followed.
    (b) Upon receipt of a request which does not reasonably describe the 
records requested, FEMA may contact the requestor to seek a more 
specific description. The 10-day time limit set forth in Sec. 5.52 will 
not start until a request reasonably describing the records is received 
in the office of the appropriate official identified in Sec. 5.51.



Sec. 5.51  Submission of requests for described records.

    (a) For records located in the FEMA Headquarters, requests shall be 
submitted in writing, to the Headquarters FOIA Officer, Federal 
Emergency Management Agency, Washington, DC 20472. For records located 
in the FEMA Regional Offices, requests shall be submitted to the 
appropriate Regional FOIA Officer, at the address listed in Sec. 5.26. 
Requests should bear the legend ``Freedom of Information Request'' 
prominently marked on both the face of the request letter and the 
envelope. The 10-day time limit for agency determinations set forth in 
Sec. 5.52 shall not start until a request is received in the office of 
the appropriate official identified in this paragraph.
    (b) The Headquarters FOIA Officer shall respond to questions 
concerning the proper office to which Freedom of Information requests 
should be addressed.



Sec. 5.52  Review of requests.

    (a) Upon receipt of a request for information, the Headquarters FOIA 
Officer, or the Regional FOIA Officer for a regional office, will 
forward the request to the FEMA office which has custody of the record.
    (b) Upon any request for records made pursuant to Sec. 5.20, 
Sec. 5.24, or Sec. 5.51, the office having custody of the records shall 
determine within 10 workdays, after receipt of any such request in the 
office of the appropriate official identified in Sec. 5.51 whether to 
comply with the request. If the request is approved, the office having 
custody of the record shall notify the requestor and the Headquarters 
FOIA Officer whether request originated in Headquarters, Region or 
field.

[44 FR 50287, Aug. 27, 1979, as amended at 50 FR 40006, Oct. 1, 1985; 53 
FR 2740, Feb. 1, 1988]



Sec. 5.53  Approval of request.

    When a request is approved, records will be made available promptly 
in accordance with the terms of the regulation. Copies may be furnished 
or the records may be inspected and copied as provided in Sec. 5.26.



Sec. 5.54  Denial of request of records.

    (a) Each of the following officials within FEMA, any official 
designated to act for the official, or any official redelegated 
authority by such officials shall have the authority to make initial 
denials of requests for disclosure of records in his or her custody, and 
shall, in accordance with 5 U.S.C. 552(a)(6)(C) be the responsible 
official for denial of records under this part.
    (1) Deputy Director
    (2) [Reserved]
    (3) Federal Insurance Administrator
    (4) Associate Directors
    (5) United States Fire Administrator
    (6) Chief of Staff
    (7) Office Directors
    (8) General Counsel
    (9) Inspector General
    (10) Comptroller
    (11) Regional Directors
    (b) If a request is denied, the appropriate official listed in 
paragraph (a) of this section shall except as provided in Sec. 5.56 
advise the requestor within 10 workdays of receipt of the request by the 
official specified in Sec. 5.51 and furnish written reasons for the 
denial. The denial will (1) describe the record or records requested, 
(2) state the reasons for nondisclosure pursuant to subpart E, (3) state 
the name and title or position of the official responsible for the 
denial of such request, and (4) state the requestor's appeal rights.
    (c) In the event FEMA cannot locate requested records the 
appropriate official specified in paragraph (a) of this

[[Page 39]]

section will inform the requestor (1) that the agency has determined at 
the present time to deny the request because the records have not yet 
been found or examined, but (2) that the agency will review the request 
within a specified number of days, when the search or examination is 
expected to be complete. The denial letter will state the name and title 
or position of the official responsible for the denial of such request. 
In such event, the requestor may file an agency appeal immediately, 
pursuant to Sec. 5.55.

[44 FR 50287, Aug. 27, 1979, as amended at 48 FR 44542, Sept. 29, 1983; 
50 FR 40006, Oct. 1, 1985; 51 FR 34604, Sept. 30, 1986]



Sec. 5.55  Appeal within FEMA of denial of request.

    (a) A requestor denied access, in whole or in part, to FEMA records 
may appeal that decision within FEMA. All appeals should be addressed to 
the Headquarters FOIA Officer, Federal Emergency Management Agency, 
Washington, DC, 20472 regardless of whether the denial being appealed 
was made at Headquarters, in a field office, or by a Regional Director.
    (b) An appeal must be received in the Headquarters FOIA Office no 
later than thirty calendar days after receipt by the requestor of the 
initial denial.
    (c) An appeal must be in writing and should contain a brief 
statement of the reasons why the records should be released and enclose 
copies of the initial request and denial. The appeal letter should bear 
the legend, ``FREEDOM OF INFORMATION APPEAL,'' conspicuously marked on 
both the face of the appeal letter and on the envelope. FEMA has twenty 
workdays after the receipt of an appeal to make a determination with 
respect to such appeal. The twenty day time limit shall not begin to run 
until the appeal is received by the Headquarters FOIA Officer. 
Misdirected appeals should be promptly forwarded to that office.
    (d) The Headquarters FOIA Officer will submit the appeal to the 
Deputy Director for final administrative determination.
    (e) The Deputy Director shall be the deciding official on all 
appeals except in those cases in which the initial denial was made by 
him/her. If the Deputy Director made the initial denial, the Director 
will be the deciding official on any appeal from that denial. In the 
absence of the Deputy Director, or in case of a vacancy in that office, 
the Director may designate another FEMA official to perform the Deputy's 
functions.
    (f) If an appeal is filed in response to a tentative denial pending 
locating and/or examination of records, as described in Sec. 5.53(c), 
FEMA will continue to search for and/or examine the requested records 
and will issue a response immediately upon completion of the search and/
or examination. Such action in no way suspends the time for FEMA's 
response to the requestor's appeal which FEMA will continue to process 
regardless of the response under this paragraph.
    (g) If a requestor files suit pending an agency appeal, FEMA 
nonetheless will continue to process the appeal, and will furnish a 
response within the twenty day time limit set out in paragraph (c) of 
this section.
    (h) If, on appeal, the denial of the request for records is in whole 
or in part upheld, the Deputy Director will promptly furnish the 
requestor a copy of the ruling in writing within the twenty day time 
limit set out in paragraph (c) of this section except as provided in 
Sec. 5.55. The notification letter shall contain:
    (1) A brief description of the record or records requested;
    (2) A statement of the legal basis for nondisclosure;
    (3) A statement of the name and title or position of the official or 
officials responsible for the denial of the initial request as described 
in Sec. 5.54 and the denial of the appeal as described in paragraph (f) 
of this section, and
    (4) A statement of the requestor's rights of judicial review.

[44 FR 50287, Aug. 27, 1979, as amended at 45 FR 1422, Jan. 7, 1980; 50 
FR 40006, Oct. 1, 1985]



Sec. 5.56  Extension of time limits.

    In unusual circumstances as specified in this section, the time 
limits prescribed in Secs. 5.52 and 5.55 may be extended by an official 
named in Sec. 5.54(a) who will provide written notice to the requestor 
setting forth the reasons for such extension and the date on which a

[[Page 40]]

determination is expected. Such notice will specify no date that would 
result in an extension of more than ten work days. In unusual 
circumstances, the Headquarters FOIA Officer may authorize more than one 
extension, divided between the initial request stage and the appeals 
stage, but in no event will the combined periods of extension exceed ten 
work days. As used in this section, ``unusual circumstances'' include 
only those circumstances where extension of time is reasonably necessary 
to the proper processing of the particular request. Examples include:
    (a) The need to search for and collect the requested records from 
field facilities or other establishments that are separate from the 
office processing the request; or
    (b) The need to search for, collect, and appropriately examine a 
voluminous amount of separate and distinct records which are demanded in 
a single request; or
    (c) The need for consultation, which shall be conducted with all 
practicable speed, with another agency or with a non-Federal source 
having a substantial interest in the determination of the request or 
among two or more components of FEMA having substantial subject matter 
interest therein.



Sec. 5.57  Predisclosure notification procedures for confidential commercial information.

    (a) In general. Business information provided to FEMA by a business 
submitter shall not be disclosed pursuant to a Freedom of Information 
Act (FOIA) request except in accordance with this section. For purposes 
of this section, the following definitions apply:
    (1) Confidential commercial information means records provided to 
the government by a submitter that arguably contain material exempt from 
release under Exemption 4 of the Freedom of Information Act, 5 U.S.C 
552(b)(4), because disclosure could reasonably be expected to cause 
substantial competitive harm.
    (2) Submitter means any person or entity who provides confidential 
commercial information to the government. The term submitter includes, 
but is not limited to, corporations, State governments, and foreign 
governments.
    (b) Notice to business submitters. FEMA shall provide a submitter 
with prompt notice of receipt of a Freedom of Information Act request 
encompassing its business information whenever required in accordance 
with paragraph (c) of this section, and except as provided in paragraph 
(g) of this section. The written notice shall either describe the exact 
nature of the business information requested or provide copies of the 
records or portions of records containing the business information.
    (c) When notice is required. (1) For confidential commercial 
information submitted prior to January 1, 1988, FEMA shall provide a 
submitter with notice of receipt of a FOIA request whenever:
    (i) The records are less than 10 years old and the information has 
been designated by the submitter as confidential commercial information;
    (ii) FEMA has reason to believe that disclosure of the information 
could reasonably result in commercial or financial injury to the 
submitter; or
    (iii) The information is subject to prior express commitment of 
confidentiality given by FEMA to the submitter.
    (2) For confidential commercial information submitted to FEMA on or 
after January 1, 1988, FEMA shall provide a submitter with notice of 
receipt of a FOIA request whenever:
    (i) The submitter has in good faith designated the information as 
commercially or financially sensitive information; or
    (ii) FEMA has reason to believe that disclosure of the information 
could reasonably result in commercial or financial injury to the 
submitter.
    (3) Notice of a request for confidential commercial information 
falling within paragraph (c)(2)(i) of this section shall be required for 
a period of not more than 10 years after the date of submission unless 
the submitter requests, and provides acceptable justification for, a 
specific notice period of greater duration.
    (4) Whenever possible, the submitter's claim of confidentiality 
shall be

[[Page 41]]

supported by a statement or certification by an officer or authorized 
representative of the company that the information in question is in 
fact confidential commercial or financial information and has not been 
disclosed to the public.
    (d) Opportunity to object to disclosure. (1) Through the notice 
described in paragraph (b) of this section, FEMA shall afford a 
submitter 7 working days within which to provide FEMA with a detailed 
statement of any objection to disclosure. Such statement shall specify 
all grounds for withholding any of the information under any exemptions 
of the Freedom of Information Act and, in the case of Exemption 4, shall 
demonstrate why the information is contended to be a trade secret or 
commercial or financial information which is considered privileged or 
confidential. Information provided by a submitter pursuant to this 
paragraph may itself be subject to disclosure under the FOIA.
    (2) When notice is given to a submitter under this section, FEMA 
shall notify the requester that such notice has been given to the 
submitter. The requester will be further advised that a delay in 
responding to the request, i.e., 10 working days after receipt of the 
request by FEMA or 20 working days after receipt of the request by FEMA 
if the time limits are extended under unusual circumstances permitted by 
the FOIA, may be considered a denial of access to records and the 
requester may proceed with an adminstrative appeal or seek judicial 
review, if appropriate.
    (e) Notice of intent to disclose. FEMA shall consider carefully a 
submitter's objections and specific grounds for nondisclosure prior to 
determining whether to disclose business information. Whenever FEMA 
decides to disclose business information over the objection of a 
submitter, FEMA shall forward to the submitter a written notice which 
shall include:
    (1) A statement of the reasons for which the submitter's disclosure 
objections were not sustained;
    (2) A description of the business information to be disclosed; and
    (3) A specified disclosure date, which is 7 working days after the 
notice of the final decision to release the requested information has 
been mailed to the submitter. FEMA shall inform the submitter that 
disclosure will be made by the specified disclosure date, unless the 
submitter seeks a court injunction to prevent its release by the date. 
When notice is given to a submitter under this section, FEMA shall 
notify the requester that such notice has been given to the submitter 
and the proposed date for disclosure.
    (f) Notice of lawsuit. (1) Whenever a requester brings legal action 
seeking to compel disclosure of business information covered by 
paragraph (c) of this section, FEMA shall promptly notify the submitter.
    (2) Whenever a submitter brings legal action seeking to prevent 
disclosure of business information covered by paragraph (c) of this 
section, FEMA shall promptly notify the requester.
    (g) Exception to notice requirement. The notice requirements of this 
section shall not apply if:
    (1) FEMA determines that the information shall not be disclosed;
    (2) The information has been published or otherwise officially made 
available to the public;
    (3) Disclosure of the information is required by law (other than 5 
U.S.C. 552); or
    (4) The information was required in the course of a lawful 
investigation of a possible violation of criminal law.

[53 FR 2740, Feb. 1, 1988]



Sec. 5.58  Exhaustion of administrative remedies.

    Any person making a request to FEMA for records under this part 
shall be deemed to have exhausted his administrative remedies with 
respect to the request if the agency fails to comply with the applicable 
time limit provisions set forth in Secs. 5.52 and 5.55.

[44 FR 50287, Aug. 27, 1979. Redesignated at 53 FR 2740, Feb. 1, 1988]



Sec. 5.59  Judicial relief available to the public.

    Upon denial of a requestor's appeal by the Deputy Director the 
requester may file a complaint in a district court of the United States 
in the district in which the complainant resides, or has his principal 
place of business, or in

[[Page 42]]

which the agency records are situated, or in the District of Columbia, 
pursuant to 5 U.S.C. 552(a)(4)(B).

[44 FR 50287, Aug. 27, 1979. Redesignated at 53 FR 2740, Feb. 1, 1988]



Sec. 5.60  Disciplinary action against employees for ``arbitrary or capricious'' denial.

    Pursuant to 5 U.S.C. 552(a)(4)(F), whenever the district court, 
described in Sec. 5.59 orders the production of any FEMA records 
improperly withheld from the complainant and assesses against the United 
States reasonable attorney fees and other litigation costs, and the 
court additionally issues a written finding that the circumstances 
surrounding the withholding raise questions whether FEMA personnel acted 
arbitrarily or capriciously with respect to the withholding, the Special 
Counsel in the Merit Systems Protection Board is required to initiate a 
proceeding to determine whether disciplinary action is warranted against 
the officer or employee who primarily was responsible for the 
withholding. The Special Counsel after investigation and consideration 
of the evidence submitted, submits findings and recommendations to the 
Director of FEMA and sends copies of the findings and recommendations to 
the officer or employee or his or her representative. The law requires 
the Director to take any corrective action which the Special Counsel 
recommends.

[44 FR 50287, Aug. 27, 1979, as amended at 45 FR 1422, Jan. 7, 1980. 
Redesignated and amended at 53 FR 2740, Feb. 1, 1988]



Sec. 5.61  Contempt for noncompliance.

    In the event of noncompliance by FEMA with an order of a district 
court pursuant to Sec. 5.60, the district court may punish for contempt 
the FEMA employee responsible for the noncompliance, pursuant to 5 
U.S.C. 552(a)(4)(G).

[44 FR 50287, Aug. 27, 1979, as amended at 45 FR 1422, Jan. 7, 1980; 50 
FR 40006, Oct. 1, 1985. Redesignated and amended at 53 FR 2740, Feb. 1, 
1988]



                          Subpart E--Exemptions



Sec. 5.70  General.

    The exemptions enumerated in 5 U.S.C. 552(b), under which the 
provisions for availability of records and informational materials will 
not apply, are general in nature. FEMA will decide each case on its 
merits in accordance with the FEMA policy expressed in subpart A.



Sec. 5.71  Categories of records exempt from disclosure under 5 U.S.C. 552.

    5 U.S.C. 552(b) provides that the requirements of the statute do not 
apply to matters that are:
    (a) Specifically authorized under criteria established by an 
Executive Order to be kept secret in the interest of national defense or 
foreign policy and are, in fact, properly classified pursuant to such 
Executive Order.
    (b) Related solely to the internal personnel rules and practices of 
an agency.
    (c) Specifically exempted from disclosure by statute other than 
section 552(b) of title 5, provided that such statute (1) requires that 
the matters be withheld from the public in such a manner as to leave no 
discretion on the issue or (2) establishes particular criteria for 
withholding or refers to particular types of matter to be withheld.
    (d) Trade secrets and commercial or financial information obtained 
from a person and privileged or confidential.
    (e) Inter-agency or intra-agency memoranda or letters which would 
not be available by law to a party other than an agency in litigation 
with the agency.
    (f) Personnel and medical files and similar files the disclosure of 
which would constitute a clearly unwarranted invasion of personal 
privacy.
    (g) Records or information compiled for law enforcment purposes, but 
only to the extent that the production of such law enforcement records 
or information:
    (1) Could reasonably be expected to interfere with enforcement 
proceedings;

[[Page 43]]

    (2) Would deprive a person of a right to a fair trial or an 
impartial adjudication;
    (3) Could reasonably be expected to constitute an unwarranted 
invasion of personal privacy;
    (4) Could reasonably be expected to disclose the identity of a 
confidential source, including a State, local, or foreign agency or 
authority or any private institution which furnished information on a 
confidential basis, and, in the case of a record or information compiled 
by a criminal law enforcement authority in the course of a criminal 
investigation, or by an agency conducting a lawful national security 
intelligence investigation, information furnished by a confidential 
source;
    (5) Would disclose techniques and procedures for law enforcement 
investigations or prosecutions, or would disclose guidelines for law 
enforcement investigations or prosecutions if such disclosure could 
reasonably be expected to risk circumvention of the law; or
    (6) Could reasonably be expected to endanger the life or physical 
safety of any individual.
    (h) Contained in or related to examination, operating, or condition 
reports prepared by, on behalf of, or for the use of any agency 
responsible for the regulation or supervision of financial institutions.
    (i) Geological and geophysical information and data, including maps, 
concerning wells. Any reasonably segregable portion of a record shall be 
provided to any person requesting the record after deletion of the 
portions which are exempt under this section.
    (j) Whenever a request is made which involves access to records 
described in paragraph (g)(1) of this section and the investigation or 
proceeding involves a possible violation of criminal law; and there is 
reason to believe that the subject of the investigation or proceeding is 
not aware of its pendency, and disclosure of the existence of the 
records could reasonably be expected to interfere with enforcement 
proceedings, FEMA may, during only such time as that circumstance 
continues, treat the records as not subject to the requirements of 5 
U.S.C. 552 and this subpart.

[44 FR 50287, Aug. 27, 1979, as amended at 52 FR 13679, Apr. 24, 1987]



Sec. 5.72  Executive privilege exemption.

    Where application of the executive privilege exemption is desired, 
the matter shall be forwarded to the Director for consideration. If the 
request for information is Congressional, only the President may invoke 
the exemption. Presidential approval is not necessarily required if the 
request for information is in connection with judicial or adjudicatory 
proceedings or otherwise. In connection with judicial proceedings, the 
response shall be coordinated with the Department of Justice.



    Subpart F--Subpoenas or Other Legal Demands for Testimony or the 
        Production or Disclosure of Records or Other Information

    Source: 54 FR 11715, Mar. 22, 1989, unless otherwise noted.



Sec. 5.80  Scope and applicability.

    (a) This subpart sets forth policies and procedures with respect to 
the disclosure or production by FEMA employees, in response to a 
subpoena, order or other demand of a court or other authority, of any 
material contained in the files of the Agency or any information 
relating to material contained in the files of the Agency or any 
information acquired by an employee as part of the performance of that 
person's official duties or because of that person's official status.
    (b) This subpart applies to State and local judicial, administrative 
and legislative proceedings, and federal judicial and administrative 
proceedings.
    (c) This subpart does not apply to Congressional requests or 
subpoenas for testimony or documents, or to an employee making an 
appearance solely in his or her private capacity in judicial or 
administrative proceedings that do not relate to the Agency (such as 
cases arising out of traffic accidents, domestic relations, etc.).

[[Page 44]]



Sec. 5.81  Statement of policy.

    (a) It is the policy of FEMA to make its records available to 
private litigants to the same extent and in the same manner as such 
records are made available to members of the general public, except 
where protected from disclosure by litigation procedural authority 
(e.g., Federal Rules of Civil Procedure) or other applicable law.
    (b) It is FEMA's policy and responsibility to preserve its human 
resources for performance of the official functions of the Agency and to 
maintain strict impartiality with respect to private litigants. 
Participation by FEMA employees in private litigation in their official 
capacities is generally contrary to this policy.



Sec. 5.82  Definitions.

    For purposes of this subpart, the following terms have the meanings 
ascribed to them in this section:
    (a) Demand refers to a subpoena, order, or other demand of a court 
of competent jurisdiction, or other specific authority (e.g., an 
administrative or State legislative body), signed by the presiding 
officer, for the production, disclosure, or release of FEMA records or 
information or for the appearance and testimony of FEMA personnel as 
witnesses in their official capacities.
    (b) Employee of the Agency includes all officers and employees of 
the United States appointed by or subject to the supervision, 
jurisdiction or control of the Director of FEMA.
    (c) Private litigation refers to any legal proceeding which does not 
involve as a named party the United States Government, or the Federal 
Emergency Management Agency, or any official thereof in his or her 
official capacity.



Sec. 5.83  Authority to accept service of subpoenas.

    In all legal proceedings between private litigants, a subpoena duces 
tecum or subpoena ad testificandum or other demand by a court or other 
authority for the production of records held by FEMA Regional offices or 
for the oral or written testimony of FEMA Regional employees should be 
addressed to the appropriate Regional Director listed in Sec. 5.26. For 
records or testimony of the Office of Inspector General, the subpoena 
should be addressed to the Inspector General, FEMA, Washington, DC 
20472. For all other records or testimony, the subpoena should be 
addressed to the General Counsel, FEMA, Washington, DC 20472. No other 
official or employee of FEMA is authorized to accept service of 
subpoenas on behalf of the Agency.



Sec. 5.84  Production of documents in private litigation.

    (a) The production of records held by FEMA in response to a subpoena 
duces tecum or other demand issued pursuant to private litigation, 
whether or not served in accordance with the provisions of Sec. 5.83 of 
this subpart, is prohibited absent authorization by the General Counsel 
or, as to records of the Office of the Inspector General, by the 
Inspector General.
    (b) Whenever an official or employee of FEMA, including any Regional 
Director, receives a subpoena or other demand for the production of 
Agency documents or material, he or she shall immediately notify and 
provide a copy of the demand to the General Counsel, unless the subpoena 
or demand seeks the production of documents or material maintained by 
the Office of Inspector General, in which case a copy of the demand 
shall be provided to the Inspector General.
    (c) The General Counsel (or Inspector General), after consultation 
with other appropriate officials as deemed necessary, shall promptly 
determine whether to disclose the material or documents identified in 
the subpoena or other demand. Generally, authorization to furnish the 
requested material or documents shall not be withheld unless their 
disclosure is prohibited by relevant law or for other compelling 
reasons.
    (d) Whenever a subpoena or demand commanding the production of any 
record is served upon any Agency employee other than as provided in 
Sec. 5.83 of this subpart, or the response to a demand is required 
before the receipt of instructions from the General Counsel (or 
Inspector General), such employee shall appear in response thereto, 
respectfully decline to produce the

[[Page 45]]

record(s) on the ground that it is prohibited by this section and state 
that the demand has been referred for the prompt consideration of the 
General Counsel (or, where appropriate, the Inspector General).
    (e) Where the release of documents in response to a subpoena duces 
tecum is authorized by the General Counsel (or, as to documents 
maintained by the Office of Inspector General, the Inspector General), 
the official having custody of the requested records will furnish, upon 
the request of the party seeking disclosure, authenticated copies of the 
documents. No official or employee of FEMA shall respond in strict 
compliance with the terms of a subpoena duces tecum unless specifically 
authorized by the General Counsel (or Inspector General).



Sec. 5.85  Authentication and attestation of copies.

    The Director, Deputy Director, Associate Directors, Administrators, 
the General Counsel, the Docket Clerk, Inspector General, Regional 
Directors, and their designees, and other heads of offices having 
possession of records are authorized in the name of the Director to 
authenticate and attest for copies or reproductions of records. 
Appropriate fees will be charged for such copies or reproductions based 
on the fee schedule set forth in section 5.46 of this part.



Sec. 5.86  Production of documents in litigation or other adjudicatory proceeding in which the United States is a party.

    Subpoenas duces tecum issued pursuant to litigation or any other 
adjudicatory proceeding in which the United States is a party shall be 
handled as provided at Sec. 5.8.



Sec. 5.87  Testimony of FEMA employees in private litigation.

    (a) No FEMA employee shall testify in response to a subpoena or 
other demand in private litigation as to any information relating to 
material contained in the files of the Agency, or any information 
acquired as part of the performance of that person's official duties or 
because of that person's official status, including the meaning of 
Agency documents.
    (b) Whenever a demand is made upon a FEMA employee, other than an 
employee of the Office of Inspector General, for the disclosure of 
information described in paragraph (a) of this section, that employee 
shall immediately notify the Office of General Counsel. Employees of the 
Office of Inspector General shall notify the Inspector General of such 
demands. The General Counsel (or Inspector General through designated 
legal counsel), upon receipt of such notice and absent waiver of the 
general prohibition against employee testimony at his or her discretion, 
shall arrange with the appropriate United States Attorney the taking of 
such steps as are necessary to quash the subpoena or seek a protective 
order.
    (c) In the event that an immediate demand for testimony or 
disclosure is made in circumstances which would preclude prior notice to 
and consultation with the General Counsel (or Inspector General), the 
employee shall respectfully request from the demanding authority a stay 
in the proceedings to allow sufficient time to obtain advice of counsel.
    (d) If the court or other authority declines to stay the effect of 
the demand in response to a request made in accordance with paragraph 
(c) of this section pending consultation with counsel, or if the court 
or other authority rules that the demand must be complied with 
irrespective of instructions not to testify or disclose the information 
sought, the employee upon whom the demand has been made shall 
respectfully decline to comply with the demand, citing these regulations 
and United States ex rel. Touhy v. Ragen, 340 U.S. 462 (1951).



Sec. 5.88  Testimony in litigation in which the United States is a party.

    (a) Whenever, in any legal proceeding in which the United States is 
a party, the attorney in charge of presenting the case for the United 
States requests it, the General Counsel shall arrange for an employee of 
the Agency to testify as a witness for the United States.
    (b) The attendance and testimony of named employees of the Agency 
may not be required in any legal proceeding by the judge or other 
presiding officer,

[[Page 46]]

by subpoena or otherwise. However, the judge or other presiding officer 
may, upon a showing of exceptional circumstances (such as a case in 
which a particular named FEMA employee has direct personal knowledge of 
a material fact not known to the witness made available by the Agency) 
require the attendance and testimony of named FEMA personnel.



Sec. 5.89  Waiver.

    The General Counsel (or, as to employees of the Office of Inspector 
General, the Inspector General) may grant, in writing, a waiver of any 
policy or procedure prescribed by this subpart, where waiver is 
considered necessary to promote a significant interest of the Agency or 
for other good cause. In granting such waiver, the General Counsel (or 
Inspector General) shall attach to the waiver such reasonable conditions 
and limitations as are deemed appropriate in order that a response in 
strict compliance with the terms of a subpoena duces tecum or the 
providing of testimony will not interfere with the duties of the 
employee and will otherwise conform to the policies of this part. The 
Director may, in his or her discretion, review any decision to authorize 
a waiver of any policy or procedure prescribed by this subpart.



PART 6--IMPLEMENTATION OF THE PRIVACY ACT OF 1974--Table of Contents




                           Subpart A--General

Sec.
6.1  Purpose and scope of part.
6.2  Definitions.
6.3  Collection and use of information (Privacy Act statements).
6.4  Standards of accuracy.
6.5  Rules of conduct.
6.6  Safeguarding systems of records.
6.7  Records of other agencies.
6.8  Subpoena and other legal demands.
6.9  Inconsistent issuances of FEMA and/or its predecessor agencies 
          superseded.
6.10  Assistance and referrals.

                    Subpart B--Disclosure of Records

6.20  Conditions of disclosure.
6.21  Procedures for disclosure.
6.22  Accounting of disclosures.

                 Subpart C--Individual Access to Records

6.30  Form of requests.
6.31  Special requirements for medical records.
6.32  Granting access
6.33  Denials of access.
6.34  Appeal of denial of access within FEMA.

                  Subpart D--Requests To Amend Records

6.50  Submission of requests to amend records.
6.51  Review of requests to amend records.
6.52  Approval of requests to amend records.
6.53  Denial of requests to amend records.
6.54  Agreement to alternative amendments.
6.55  Appeal of denial of request to amend a record.
6.56  Statement of disagreement.
6.57  Judicial review.

  Subpart E--Report on New Systems and Alterations of Existing Systems

6.70  Reporting requirement.
6.71  Federal Register notice of establishment of new system or 
          alteration of existing system.
6.72  Effective date of new system of records or alteration of an 
          existing system of records.

                             Subpart F--Fees

6.80  Records available at fee.
6.81  Additional copies.
6.82  Waiver of fee.
6.83  Prepayment of fees.
6.84  Form of payment.
6.85  Reproduction fees.

                  Subpart G--Exempt Systems of Records

6.86  General exemptions.
6.87  Specific exemptions.

    Authority: 5 U.S.C. 552a; Reorganization Plan No. 3 of 1978; and 
E.O. 12127.

    Source: 44 FR 50293, Aug. 27, 1979, unless otherwise noted.



                           Subpart A--General



Sec. 6.1  Purpose and scope of part.

    This part sets forth policies and procedures concerning the 
collection, use and dissemination of records maintained by the Federal 
Emergency Management Agency (FEMA) which are subject to the provision of 
5 U.S.C. 552a, popularly known as the ``Privacy Act of 1974'' 
(hereinafter referred to as the Act). These policies and procedures 
govern only those records as defined in

[[Page 47]]

Sec. 6.2. Policies and procedures governing the disclosure and 
availability of records in general are in part 5 of this chapter. This 
part also covers: (a) Procedures for notification to individuals of a 
FEMA system of records pertaining to them; (b) guidance to individuals 
in obtaining information, including inspections of, and disagreement 
with, the content of records; (c) accounting of disclosure; (d) special 
requirements for medical records; and (e) fees.



Sec. 6.2  Definitions.

    For the purpose of this part:
    (a) Agency includes any executive department, military department, 
Government corporation, Government controlled corporation, or other 
establishment in the executive branch of the Government (including the 
Executive Office of the President), or any independent regulatory agency 
(see 5 U.S.C. 552(e)).
    (b) Individual means a citizen of the United States or an alien 
lawfully admitted for permanent residence.
    (c) Maintain includes maintain, collect, use, and disseminate.
    (d) Record means any item, collection, or grouping of information 
about an individual that is maintained by an agency, including, but not 
limited to those concerning education, financial transactions, medical 
history, and criminal or employment history, and that contains the name 
or other identifying particular assigned to the individual, such as a 
fingerprint, voiceprint, or photograph.
    (e) System of records means a group of any records under the control 
of an agency from which information is retrieved by the name of the 
individual or by some identifying number, symbol, or other 
identification assigned to that individual.
    (f) Statistical record means a record in a system of records 
maintained for statistical research or reporting purposes only and not 
used in whole or in part in making any determination about an 
identifiable individual, except as provided by 13 U.S.C. 8.
    (g) Routine use means, with respect to the disclosure of a record, 
the use of that record for a purpose which is compatible with the 
purpose for which it was collected.
    (h) System manager means the employee of FEMA who is responsible for 
the maintenance of a system of records and for the collection, use, and 
dissemination of information therein.
    (i) Subject individual means the individual named or discussed in a 
record of the individual to whom a record otherwise pertains.
    (j) Disclosure means a transfer of a record, a copy of a record, or 
any or all of the information contained in a record to a recipient other 
than the subject individual, or the review of a record by someone other 
than the subject individual.
    (k) Access means a transfer of a record, a copy of a record, or the 
information in a record to the subject individual, or the review of a 
record by the subject individual.
    (l) Solicitation means a request by an officer or employee of FEMA 
that an individual provide information about himself or herself.
    (m) Director means the Director, FEMA.
    (n) Deputy Director means the Deputy Director, FEMA, or, in the case 
of the absence of the Deputy Director, or a vacancy in that office, a 
person designated by the Director to perform the functions under this 
regulation of the Deputy Director.
    (o) Privacy Appeals Officer means the FOIA/Privacy Act Specialist or 
his/her designee.

[44 FR 50293, Aug. 27, 1979, as amended at 45 FR 17152, Mar. 18, 1980; 
51 FR 34604, Sept. 30, 1986]



Sec. 6.3  Collection and use of information (Privacy Act statements).

    (a) General. Any information used in whole or in part in making a 
determination about an individual's rights, benefits, or privileges 
under FEMA programs will be collected directly from the subject 
individual to the extent practicable. The system manager also shall 
ensure that information collected is used only in conformance with the 
provisions of the Act and these regulations.
    (b) Solicitation of information. System managers shall ensure that 
at the time information is solicited the solicited individual is 
informed of the authority

[[Page 48]]

for collecting that information, whether providing the information is 
mandatory or voluntary, the purpose for which the information will be 
used, the routine uses to be made of the information, and the effects on 
the individual, if any, of not providing the information. The Director, 
Office of Administrative Support and Regional Directors shall ensure 
that forms used to solicit information are in compliance with the Act 
and these regulations.
    (c) Solicitation of Social Security numbers. Before an employee of 
FEMA can deny to any individual a right, benefit, or privilege provided 
by law because such individual refuses to disclose his/her social 
security account number, the employee of FEMA shall ensure that either:
    (1) The disclosure is required by Federal statute; or
    (2) The disclosure of a social security number was required under a 
statute or regulation adopted before January 1, 1975, to verify the 
identity of an individual, and the social security number will become a 
part of a system of records in existence and operating before January 1, 
1975.

If solicitation of the social security number is authorized under 
paragraph (c) (1) or (2) of this section, the FEMA employee who requests 
an individual to disclose the social security account number shall first 
inform that individual whether that disclosure is mandatory or 
voluntary, by what statutory or other authority the number is solicited, 
and the use that will be made of it.
    (d) Soliciting information from third parties. An employee of FEMA 
shall inform third parties who are requested to provide information 
about another individual of the purposes for which the information will 
be used.

[44 FR 50293, Aug. 27, 1979, as amended at 47 FR 13149, Mar. 29, 1982; 
48 FR 12091, Mar. 23, 1983; 50 FR 40006, Oct. 1, 1985]



Sec. 6.4  Standards of accuracy.

    The system manager shall ensure that all records which are used by 
FEMA to make determinations about any individual are maintained with 
such accuracy, relevance, timeliness, and completeness as is reasonably 
necessary to ensure fairness to the individual.



Sec. 6.5  Rules of conduct.

    Employees of FEMA involved in the design, development, operation, or 
maintenance of any system of records or in maintaining any record, shall 
conduct themselves in accordance with the rules of conduct concerning 
the protection of personal information in Sec. 3.25 of this chapter.



Sec. 6.6  Safeguarding systems of records.

    (a) Systems managers shall ensure that appropriate administrative, 
technical, and physical safeguards are established to ensure the 
security and confidentiality of records and to protect against any 
anticipated threats or hazards to their security or integrity which 
could result in substantial harm, embarrassment, inconvenience, or 
unfairness to any individual on whom information is maintained.
    (b) Personnel information contained in both manual and automated 
systems of records shall be protected by implementing the following 
safeguards:
    (1) Official personnel folders, authorized personnel operating or 
work folders and other records of personnel actions effected during an 
employee's Federal service or affecting the employee's status and 
service, including information on experience, education, training, 
special qualification, and skills, performance appraisals, and conduct, 
shall be stored in a lockable metal filing cabinet when not in use by an 
authorized person. A system manager may employ an alternative storage 
system providing that it furnished an equivalent degree of physical 
security as storage in a lockable metal filing cabinet.
    (2) System managers, at their discretion, may designate additional 
records of unusual sensitivity which require safeguards similar to those 
described in paragraph (a) of this section.
    (3) A system manager shall permit access to and use of automated or 
manual personnel records only to persons whose official duties require 
such access, or to a subject individual or his or her representative as 
provided by this part.

[[Page 49]]



Sec. 6.7  Records of other agencies.

    If FEMA receives a request for access to records which are the 
primary responsibility of another agency, but which are maintained by or 
in the temporary possession of FEMA on behalf of that agency, FEMA will 
advise the requestor that the request has been forwarded to the 
responsible agency. Records in the custody of FEMA which are the primary 
responsibility of the Office of Personnel Management are governed by the 
rules promulgated by it pursuant to the Privacy Act.



Sec. 6.8  Subpoena and other legal demands.

    Access to records in systems of records by subpoena or other legal 
process shall be in accordance with the provisions of part 5 of this 
chapter.



Sec. 6.9  Inconsistent issuances of FEMA and/or its predecessor agencies superseded.

    Any policies and procedures in any issuances of FEMA or any of its 
predecessor agencies which are inconsistent with the policies and 
procedures in this part are superseded to the extent of that 
inconsistency.



Sec. 6.10  Assistance and referrals.

    Requests for assistance and referral to the responsible system 
manager or other FEMA employee charged with implementing these 
regulations should be made to the Privacy Appeals Officer, Federal 
Emergency Management Agency, Washington, DC 20472.

[45 FR 17152, Mar. 18, 1980]



                    Subpart B--Disclosure of Records



Sec. 6.20  Conditions of disclosure.

    No employee of FEMA shall disclose any record to any person or to 
another agency without the express written consent of the subject 
individual unless the disclosure is:
    (a) To officers or employees of FEMA who have a need for the 
information in the official performance of their duties;
    (b) Required by the provisions of the Freedom of Information Act, 5 
U.S.C. 552.
    (c) For a routine use as published in the notices in the Federal 
Register;
    (d) To the Bureau of the Census for use pursuant to title 13, United 
States Code;
    (e) To a recipient who has provided FEMA with advance adequate 
written assurance that the record will be used solely as a statistical 
research or reporting record subject to the following: The record shall 
be transferred in a form that is not individually identifiable. The 
written statement should include as a minimum (1) a statement of the 
purpose for requesting the records; and (2) certification that the 
records will be used only for statistical purposes. These written 
statements should be maintained as accounting records. In addition to 
deleting personal identifying information from records released for 
statistical purposes, the system manager shall ensure that the identity 
of the individual cannot reasonably be deduced by combining various 
statistical records;
    (f) To the National Archives of the United States as a record which 
has sufficient historical or other value to warrant its continued 
preservation by the United States Government, or for evaluation by the 
Administrator of The National Archives and Records Administration or his 
designee to determine whether the record has such value;
    (g) To another agency or instrumentality of any governmental 
jurisdiction within or under the control of the United States for civil 
or criminal law enforcement activity, if the activity is authorized by 
law, and if the head of the agency or instrumentality or his designated 
representative has made a written request to the Director specifying the 
particular portion desired and the law enforcement activity for which 
the record is sought;
    (h) To a person showing compelling circumstances affecting the 
health and safety of an individual to whom the record pertains. (Upon 
such disclosure, a notification must be sent to the last known address 
of the subject individual.)
    (i) To either House of Congress or to a subcommittee or committee 
(joint or of either House, to the extent that the subject matter falls 
within their jurisdiction;
    (j) To the Comptroller General or any duly authorized 
representatives of the

[[Page 50]]

Comptroller General in the course of the performance of the duties of 
the General Accounting Office; or
    (k) Pursuant to the order of a court of competent jurisdiction.
    (l) To consumer reporting agencies as defined in the Fair Credit 
Reporting Act (35 U.S.C. 1681a(f) or the Debt Collection Act of 1982 (31 
U.S.C. 3711(d)(4)).

[44 FR 50293, Aug. 27, 1979, as amended at 48 FR 44543, Sept. 29, 1983; 
50 FR 40006, Oct. 1, 1985]



Sec. 6.21  Procedures for disclosure.

    (a) Upon receipt of a request for disclosure, the system manager 
shall verify the right of the requestor to obtain disclosure pursuant to 
Sec. 6.20. Upon that verification and subject to other requirements of 
this part, the system manager shall make the requested records 
available.
    (b) If the system manager determines that the disclosure is not 
permitted under the provisions of Sec. 6.20 or other provisions of this 
part, the system manager shall deny the request in writing and shall 
inform the requestor of the right to submit a request for review and 
final determination to the Director or designee.



Sec. 6.22  Accounting of disclosures.

    (a) Except for disclosures made pursuant to Sec. 6.20 (a) and (b), 
an accurate accounting of each disclosure shall be made and retained for 
5 years after the disclosure or for the life of the record, whichever is 
longer. The accounting shall include the date, nature, and purpose of 
each disclosure, and the name and address of the person or agency to 
whom the disclosure is made;
    (b) The system manager also shall maintain in conjunction with the 
accounting of disclosures;
    (1) A full statement of the justification for the disclosure.
    (2) All documentation surrounding disclosure of a record for 
statistical or law enforcement purposes; and
    (3) Evidence of written consent to a disclosure given by the subject 
individual.
    (c) Except for the accounting of disclosures made to agencies or 
instrumentalities in law enforcement activities in accordance with 
Sec. 6.20 (g) or of disclosures made from exempt systems the accounting 
of disclosures shall be made available to the individual upon request. 
Procedures for requesting access to the accounting are in subpart C of 
this part.



                 Subpart C--Individual Access to Records



Sec. 6.30  Form of requests.

    (a) An individual who seeks access to his or her record or to any 
information pertaining to the individual which is contained in a system 
of records should notify the system manager at the address indicated in 
the Federal Register notice describing the pertinent system. The notice 
should bear the legend ``Privacy Act Request'' both on the request 
letter and on the envelope. It will help in the processing of a request 
if the request letter contains the complete name and identifying number 
of the system as published in the Federal Register; the full name and 
address of the subject individual; a brief description of the nature, 
time, place, and circumstances of the individual's association with 
FEMA; and any other information which the individual believes would help 
the system manager to determine whether the information about the 
individual is included in the system of records. The system manager 
shall answer or acknowledge the request within 10 workdays of its 
receipt by FEMA.
    (b) The system manager, at his discretion, may accept oral requests 
for access subject to verification of identity.



Sec. 6.31  Special requirements for medical records.

    (a) A system manager who receives a request from an individual for 
access to those official medical records which belong to the U.S. Office 
of Personnel Management and are described in Chapter 339, Federal 
Personnel Manual (medical records about entrance qualifications or 
fitness for duty, or medical records which are otherwise filed in the 
Official Personnel Folder), shall refer the pertinent system of records 
to a Federal Medical Officer for review and determination in accordance 
with this section. If no Federal Medical Officer is available to make 
the determination

[[Page 51]]

required by this section, the system manager shall refer the request and 
the medical reports concerned to the Office of Personnel Management for 
determination.
    (b) If, in the opinion of a Federal Medical Officer, medical records 
requested by the subject individual indicate a condition about which a 
prudent physician would hesitate to inform a person suffering from such 
a condition of its exact nature and probable outcome, the system manager 
shall not release the medical information to the subject individual nor 
to any person other than a physician designated in writing by the 
subject individual, or the guardian or conservator of the individual.
    (c) If, in the opinion of a Federal Medical Officer, the medical 
information does not indicate the presence of any condition which would 
cause a prudent physician to hesitate to inform a person suffering from 
such a condition of its exact nature and probable outcome, the system 
manager shall release it to the subject individual or to any person, 
firm, or organization which the individual authorizes in writing to 
receive it.



Sec. 6.32  Granting access.

    (a) Upon receipt of a request for access to non-exempt records, the 
system manager shall make these records available to the subject 
individual or shall acknowledge the request within 10 workdays of its 
receipt by FEMA. The acknowledgment shall indicate when the system 
manager will make the records available.
    (b) If the system manager anticipates more than a 10 day delay in 
making a record available, he or she also shall include in the 
acknowledgment specific reasons for the delay.
    (c) If a subject individual's request for access does not contain 
sufficient information to permit the system manager to locate the 
records, the system manager shall request additional information from 
the individual and shall have 10 workdays following receipt of the 
additional information in which to make the records available or to 
acknowledge receipt of the request and indicate when the records will be 
available.
    (d) Records will be available for authorized access during normal 
business hours at the offices where the records are located. A requestor 
should be prepared to identify himself or herself by signature; i.e., to 
note by signature the date of access and/or produce other identification 
verifying the signature.
    (e) Upon request, a system manager shall permit an individual to 
examine the original of a non-exempt record, shall provide the 
individual with a copy of the record, or both. Fees shall be charged in 
accordance with subpart F.
    (f) An individual may request to pick up a record in person or to 
receive it by mail, directed to the name and address provided by the 
individual in the request. A system manager shall not make a record 
available to a third party for delivery to the subject individual except 
for medical records as outlined in Sec. 6.31.
    (g) An individual who selects another person to review, or to 
accompany the individual in reviewing or obtaining a copy of the record 
must, prior to the disclosure, sign a statement authorizing the 
disclosure of the record. The system manager shall maintain this 
statement with the record.
    (h) The procedure for access to an accounting of disclosure is 
identical to the procedure for access to a record as set forth in this 
section.



Sec. 6.33  Denials of access.

    (a) A system manager may deny an individual access to that 
individual's record only upon the grounds that FEMA has published the 
rules in the Federal Register exempting the pertinent system of records 
from the access requirement. These exempt systems of records are 
described in subpart G of this part.
    (b) Upon receipt of a request for access to a record which the 
system manager believes is contained within an exempt system of records 
he or she shall forward the request to the appropriate official listed 
below or to his or her delegate through normal supervisory channels.
    (1) Deputy Director
    (2) [Reserved]
    (3) Federal Insurance Administrator
    (4) Associate Directors

[[Page 52]]

    (5) United States Fire Administrator
    (6) Chief of Staff
    (7) Office Directors
    (8) General Counsel
    (9) Inspector General
    (10) Comptroller
    (11) Regional Directors

The system manager shall append to the request an explanation of the 
determination that the requested record is contained within an exempt 
system of records and a recommendation that the request be denied or 
granted.
    (c) In the event that the system manager serves in one of the 
positions listed in paragraph (b) of this section, he or she shall 
retain the responsibility for denying or granting the request.
    (d) The appropriate official listed in paragraph (b) of this section 
shall, in consultation with the Office of General Counsel and such other 
officials as deemed appropriate, determine if the request record is 
contained within an exempt system of records and:
    (1) If the record is not contained within an exempt system of 
records, the above official shall notify the system manager to grant the 
request in accordance with Sec. 6.32, or
    (2) If the record is contained within an exempt system said official 
shall;
    (i) Notify the requestor that the request is denied, including a 
statement justifying the denial and advising the requestor of a right to 
judicial review of that decision as provided in Sec. 6.57, or
    (ii) Notify the system manager to make record available to the 
requestor in accordance with Sec. 6.31, notwithstanding the record's 
inclusion within an exempt system.
    (e) The appropriate official listed in paragraph (b) of this section 
shall provide the Privacy Appeals Office with a copy of any denial of a 
requested access.

[44 FR 50293, Aug. 27, 1979, as amended at 48 FR 44543, Sept. 29, 1983; 
50 FR 40006, Oct. 1, 1985; 51 FR 34604, Sept. 30, 1986]



Sec. 6.34  Appeal of denial of access within FEMA.

    A requestor denied access in whole or in part, to records pertaining 
to that individual, exclusive of those records for which the system 
manager is the Director, may file an administrative appeal of that 
denial. Appeals of denied access will be processed in the same manner as 
processing for appeals from a denial of a request to amend a record set 
out in Sec. 6.55, regardless whether the denial being appealed is made 
at headquarters or by a regional official.



                  Subpart D--Requests To Amend Records



Sec. 6.50  Submission of requests to amend records.

    An individual who desires to amend any record containing personal 
information about the individual should direct a written request to the 
system manager specified in the pertinent Federal Register notice 
concerning FEMA's systems of records. A current FEMA employee who 
desires to amend personnel records should submit a written request to 
the FEMA Director of Personnel, Washington, DC 20472. Each request 
should include evidence of and justification for the need to amend the 
pertinent record. Each request should bear the legend ``Privacy Act--
Request to Amend Record'' prominently marked on both the face of the 
request letter and the envelope.



Sec. 6.51  Review of requests to amend records.

    (a) The system manager shall acknowledge the receipt of a request to 
amend a record within 10 workdays. If possible, the acknowledgment shall 
include the system manager's determination either to amend the record or 
to deny the request to amend as provided in Sec. 6.53.
    (b) When reviewing a record in response to a request to amend, the 
system manager shall assess the accuracy, relevance, timeliness, and 
completeness of the existing record in light of the proposed amendment 
and shall determine whether the request for the amendment is justified. 
With respect to a request to delete information, the system manager also 
shall review the request and the existing record to determine whether 
the information is relevant and necessary to accomplish an agency 
purpose required to be accomplished by statute or Executive Order.

[[Page 53]]



Sec. 6.52  Approval of requests to amend records.

    If the system manager determines that amendment of a record is 
proper in accordance with the request to amend, he or she promptly shall 
make the necessary corrections to the record and shall send a copy of 
the corrected record to the individual. Where an accounting of 
disclosure has been maintained, the system manager shall advise all 
previous recipients of the record of the fact that a correction has been 
made and the substance of the correction. Where practicable, the system 
manager shall advise the Privacy Appeals Officer that a request to amend 
has been approved.



Sec. 6.53  Denial of requests to amend records.

    (a) If the system manager determines that an amendment of a record 
is improper or that the record should be amended in a manner other than 
that requested by an individual, he shall refer the request to amend and 
his determinations and recommendations to the appropriate official 
listed in Sec. 6.33(b) through normal supervisory channels.
    (b) If the official listed in Sec. 6.33, after reviewing the request 
to amend a record, determines to amend the record in accordance with the 
request, said official promptly shall return the request to the system 
manager with instructions to make the requested amendments in accordance 
with Sec. 6.52.
    (c) If the appropriate official listed in Sec. 6.33, after reviewing 
the request to amend a record, determines not to amend the record in 
accordance with the request, the requestor shall be promptly advised in 
writing of the determination. The refusal letter (1) shall state the 
reasons for the denial of the request to amend; (2) shall include 
proposed alternative amendments, if appropriate; (3) shall state the 
requestor's right to appeal the denial of the request to amend; and (4) 
shall state the procedures for appealing and the name and title of the 
official to whom the appeal is to be addressed.
    (d) The appropriate official listed in Sec. 6.33 shall furnish the 
Privacy Appeals Officer a copy of each initial denial of a request to 
amend a record.

[44 FR 50293, Aug. 27, 1979, as amended at 45 FR 17152, Mar. 18, 1980]



Sec. 6.54  Agreement to alternative amendments.

    If the denial of a request to amend a record includes proposed 
alternative amendments, and if the requestor agrees to accept them, he 
or she must notify the official who signed the denial. That official 
immediately shall instruct the system manager to make the necessary 
amendments in accordance with Sec. 6.52.



Sec. 6.55  Appeal of denial of request to amend a record.

    (a) A requestor who disagrees with a denial of a request to amend a 
record may file an administrative appeal of that denial. The requestor 
should address the appeal to the FEMA Privacy Appeals Officer, 
Washington, DC 20472. If the requestor is an employee of FEMA and the 
denial to amend involves a record maintained in the employee's Official 
Personnel Folder covered by an Office of Personnel Management 
Government-wide system notice, the appeal should be addressed to the 
Assistant Director, Information Systems, Agency Compliance and 
Evaluation Group, Office of Personnel Management, Washington, DC 20415.
    (b) Each appeal to the Privacy Act Appeals Officer shall be in 
writing and must be received by FEMA no later than 30 calendar days from 
the requestor's receipt of a denial of a request to amend a record. The 
appeal should bear the legend ``Privacy Act--Appeal,'' both on the face 
of the letter and the envelope.
    (c) Upon receipt of an appeal, the Privacy Act Appeals Officer shall 
consult with the system manager, the official who made the denial, the 
General Counsel or a member of that office, and such other officials as 
may be appropriate. If the Privacy Act Appeals Officer in consultation 
with these officials, determines that the record should be amended, as 
requested, the system manager shall be instructed immediately to amend 
the record in accordance with Sec. 6.52 and shall notify the requestor 
of that action.

[[Page 54]]

    (d) If the Privacy Act Appeals Officer, in consultation with the 
officials specified in paragraph (c) of this section, determines that 
the appeal should be rejected, the Privacy Act Appeals Officer shall 
submit the file on the request and appeal, including findings and 
recommendations, to the Deputy Director for a final administrative 
determination.
    (e) If the Deputy Director determines that the record should be 
amended as requested, he or she immediately shall instruct the system 
manager in writing to amend the record in accordance with Sec. 6.52. The 
Deputy Director shall send a copy of those instructions to the Privacy 
Act Appeals Officer, who shall notify the requester of that action.
    (f) If the Deputy Director determines to reject the appeal, the 
requestor shall immediately be notified in writing of that 
determination. This action shall constitute the final administrative 
determination on the request to amend the record and shall include:
    (1) The reasons for the rejection of the appeal.
    (2) Proposed alternative amendments, if appropriate, which the 
requestor subsequently may accept in accordance with Sec. 6.54.
    (3) Notice of the requestor's right to file a Statement of 
Disagreement for distribution in accordance with Sec. 6.56.
    (4) Notice of the requestor's right to seek judicial review of the 
final administrative determination, as provided in Sec. 6.57.
    (g) The final agency determination must be made no later than 30 
workdays from the date on which the appeal is received by the Privacy 
Act Appeals Officer.
    (h) In extraordinary circumstances, the Director may extend this 
time limit by notifying the requestor in writing before the expiration 
of the 30 workdays. The Director's notification will include a 
justification for the extension.

[44 FR 50293, Aug. 27, 1979, as amended at 45 FR 17152, Mar. 18, 1980]



Sec. 6.56  Statement of disagreement.

    Upon receipt of a final administrative determination denying a 
request to amend a record, the requestor may file a Statement of 
Disagreement with the appropriate system manager. The Statement of 
Disagreement should include an explanation of why the requestor believes 
the record to be inaccurate, irrelevant, untimely, or incomplete. The 
system manager shall maintain the Statement of Disagreement in 
conjunction with the pertinent record, and shall include a copy of the 
Statement of Disagreement in any disclosure of the pertinent record. The 
system manager shall provide a copy of the Statement of Disagreement to 
any person or agency to whom the record has been disclosed only if the 
disclosure was subject to the accounting requirements of Sec. 6.22.



Sec. 6.57  Judicial review.

    Within 2 years of receipt of a final administrative determination as 
provided in Sec. 6.34 or Sec. 6.55, a requestor may seek judicial review 
of that determination. A civil action must be filed in the Federal 
District Court in which the requestor resides or has his or her 
principal place of business or in which the agency records are situated, 
or in the District of Columbia.



  Subpart E--Report on New Systems and Alterations of Existing Systems



Sec. 6.70  Reporting requirement.

    (a) No later than 90 calendar days prior to the establishment of a 
new system of records, the prospective system manager shall notify the 
Privacy Appeals Officer of the proposed new system. The prospective 
system manager shall include with the notification a completed FEMA Form 
11-2, System of Records Covered by the Privacy Act of 1974, and a 
justification for each system of records proposed to be established. If 
the Privacy Appeals Officer determines that the establishment of the 
proposed system is in the best interest of the Government, then no later 
than 60 calendar days prior to the establishment of that system of 
records, a report of the proposal shall be submitted by the Director or 
a designee thereof, to the President of the Senate, the Speaker of the 
House of Representatives, and the Administrator, Office of Information 
and Regulatory Affairs, Office of Management and Budget for

[[Page 55]]

their evaluation of the probable or potential effect of that proposal on 
the privacy and other personal or property rights of individuals.
    (b) No later than 90 calendar days prior to the alteration of a 
system of records, the system manager responsible for the maintenance of 
that system of records shall notify the Privacy Appeals Officer of the 
proposed alteration. The system manager shall include with the 
notification a completed FEMA Form 11-2. System of Records Covered by 
the Privacy Act of 1974, and a justification for each system of records 
he proposes to alter. If it is determined that the proposed alteration 
is in the best interest of the Government, then, the Director, or a 
designee thereof, shall submit, no later than 60 calendar days prior to 
the establishment of that alteration, a report of the proposal to the 
President of the Senate, the Speaker of the House of Representatives, 
and the Administrator, Office of Information and Regulatory Affairs, 
Office of Management and Budget for their evaluation of the probable or 
potential effect of that proposal on the privacy and other personal or 
property rights of individuals.
    (c) The reports required by this regulation are exempt from reports 
control.
    (d) The Administrator, Office of Information and Regulatory Affairs, 
Office of Management and Budget may waive the time requirements set out 
in this section upon a finding that a delay in the establishing or 
amending the system would not be in the public interest and showing how 
the public interest would be adversely affected if the waiver were not 
granted and otherwise complying with OMB Circular A-130.

[44 FR 50293, Aug. 27, 1979, as amended at 45 FR 17152, Mar. 18, 1980; 
51 FR 34604, Sept. 30, 1986]



Sec. 6.71  Federal Register notice of establishment of new system or alteration of existing system.

    Notice of the proposed establishment or alteration of a system of 
records shall be published in the Federal Register, in accordance with 
FEMA procedures when:
    (a) Notice is received that the Senate, the House of 
Representatives, and the Office of Management and Budget do not object 
to the establishment of a new system or records or to the alteration of 
an existing system of records, or
    (b) No fewer than 30 calendar days elapse from the date of 
submission of the proposal to the Senate, the House of Representatives, 
and the Office of Management and Budget without receipt of an objection 
to the proposal. The notice shall include all of the information 
required to be provided in FEMA Form 11-2, System of Records Covered by 
the Privacy Act of 1974, and such other information as the Director 
deems necessary.



Sec. 6.72  Effective date of new system of records or alteration of an existing system of records.

    Systems of records proposed to be established or altered in 
accordance with the provisions of this subpart shall be effective no 
sooner than 30 calendar days from the publication of the notice required 
by Sec. 6.71.



                             Subpart F--Fees



Sec. 6.80  Records available at fee.

    The system manager shall provide a copy of a record to a requestor 
at a fee prescribed in Sec. 6.85 unless the fee is waived under 
Sec. 6.82.

[44 FR 50293, Aug. 27, 1979, as amended at 45 FR 17152, Mar. 18, 1980]



Sec. 6.81  Additional copies.

    A reasonable number of additional copies shall be provided for the 
applicable fee to a requestor who indicates that he has no access to 
commercial reproduction services.



Sec. 6.82  Waiver of fee.

    The system manager shall make one copy of a record, up to 300 pages, 
available without charge to a requestor who is an employee of FEMA. The 
system manager may waive the fee requirement for any other requestor if 
the cost of collecting the fee is an unduly large part of, or greater 
than, the fee, or when furnishing the record without

[[Page 56]]

charge conforms to generally established business custom or is in the 
public interest.

[44 FR 50287, Aug. 27, 1979, as amended at 52 FR 13679, Apr. 24, 1987]



Sec. 6.83  Prepayment of fees.

    (a) When FEMA estimates or determines that allowable charges that a 
requester may be required to pay are likely to exceed $250.00, FEMA may 
require a requester to make an advance payment of the entire fee before 
continuing to process the request.
    (b) When a requester has previously failed to pay a fee charged in a 
timely fashion (i.e., within 30 days of the date of the billing), FEMA 
may require the requester to pay the full amount owed plus any 
applicable interest as provided in Sec. 6.85(d), and to make an advance 
payment of the full amount of the estimated fee before the agency begins 
to process a new request or a pending request from that requester.
    (c) When FEMA acts under Sec. 5.44 (a) or (b), the administrative 
time limits prescribed in subsection (a)(6) of the FOIA (i.e., 10 
working days from the receipt of initial requests and 20 working days 
from receipt of appeals from initial denial, plus permissible extensions 
of these time limits) will begin only after FEMA has received fee 
payments described under Sec. 5.44 (a) or (b).

[52 FR 13679, Apr. 24, 1987]



Sec. 6.84  Form of payment.

    Payment shall be by check or money order payable to The Federal 
Emergency Management Agency and shall be addressed to the system 
manager.



Sec. 6.85  Reproduction fees.

    (a) Duplication costs. (1) For copies of documents reproduced on a 
standard office copying machine in sizes up to 8\1/2\ x 14 inches, the 
charge will be $.15 per page.
    (2) The fee for reproducing copies of records over 8\1/2\ x 14 
inches or whose physical characteristics do not permit reproduction by 
routine electrostatic copying shall be the direct cost of reproducing 
the records through Government or commercial sources. If FEMA estimates 
that the allowable duplication charges are likely to exceed $25, it 
shall notify the requester of the estimated amount of fees, unless the 
requester has indicated in advance his/her willingness to pay fees as 
high as those anticipated. Such a notice shall offer a requester the 
opportunity to confer with agency personnel with the objective of 
reformulating the request to meet his/her needs at a lower cost.
    (3) For other methods of reproduction or duplication, FEMA shall 
charge the actual direct costs of producing the document(s). If FEMA 
estimates that the allowable duplication charges are likely to exceed 
$25, it shall notify the requester of the estimated amount of fees, 
unless the requester has indicated in advance his/her willingness to pay 
fees as high as those anticipated. Such a notice shall offer a requester 
the opportunity to confer with agency personnel with the objective of 
reformulating the request to meet his/her needs at a lower cost.
    (b) Interest may be charge to those requesters who fail to pay fees 
charged. FEMA may begin assessing interest charges on the amount billed 
starting on the 31st day following the day on which the billing was 
sent. Interest will be at the rate prescribed in section 3717 of title 
31 U.S.C.

[52 FR 13679, Apr. 24, 1987]



                  Subpart G--Exempt Systems of Records



Sec. 6.86  General exemptions.

    (a) Whenever the Director, Federal Emergency Management Agency, 
determines it to be necessary and proper, with respect to any system of 
records maintained by the Federal Emergency Management Agency, to 
exercise the right to promulgate rules to exempt such systems in 
accordance with the provisions of 5 U.S.C. 552a (j) and (k), each 
specific exemption, including the parts of each system to be exempted, 
the provisions of the Act from which they are exempted, and the 
justification for each exemption shall be published in the Federal 
Register as part of FEMA's Notice of Systems of Records.
    (b) Exempt under 5 U.S.C. 552a(j)(2) from the requirements of 5 
U.S.C. 552a(c) (3) and (4), (d), (e) (1), (2), (3),

[[Page 57]]

(e)(4) (G), (H), and (I), (e) (5) and (8) (f) and (g) of the Privacy 
Act.
    (1) Exempt systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552(j)(2), shall be exempt 
from the provisions of 5 U.S.C. 552a listed in paragraph (b) of this 
section.

General Investigative Files (FEMA/IG-2)--Limited Access

    (2) Reasons for exemptions. (i) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The Federal Emergency Management Agency 
believes that application of these provisions to the above-listed system 
of records would give individuals an opportunity to learn whether they 
are of record either as suspects or as subjects of a criminal 
investigation; this would compromise the ability of the Federal 
Emergency Management Agency to complete investigations and identify or 
detect violators of laws administered by the Federal Emergency 
Management Agency or other Federal agencies. Individuals would be able 
(A) to take steps to avoid detection, (B) to inform co-conspirators of 
the fact that an investigation is being conducted, (C) to learn the 
nature of the investigation to which they are being subjected, (D) to 
learn the type of surveillance being utilized, (E) to learn whether they 
are only suspects or identified law violators, (F) to continue to resume 
their illegal conduct without fear of detection upon learning that they 
are not in a particular system of records, and (G) to destroy evidence 
needed to prove the violation.
    (ii) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The Federal 
Emergency Management Agency believes that application of these 
provisions to the above-listed system of records would compromise its 
ability to complete or continue criminal investigations and to detect or 
identify violators of laws administered by the Federal Emergency 
Management Agency or other Federal agencies. Permitting access to 
records contained in the above-listed system of records would provide 
individuals with significant information concerning the nature of the 
investigation, and this could enable them to avoid detection or 
apprehension in the following ways:
    (A) By discovering the collection of facts which would form the 
basis for their arrest, (B) by enabling them to destroy evidence of 
criminal conduct which would form the basis for their arrest, and (C) by 
learning that the criminal investigators had reason to believe that a 
crime was about to be committed, they could delay the commission of the 
crime or change the scene of the crime to a location which might not be 
under surveillance. Granting access to ongoing or closed investigative 
files would also reveal investigative techniques and procedures, the 
knowledge of which could enable individuals planning criminal activity 
to structure their future operations in such a way as to avoid detection 
or apprehension, thereby neutralizing law enforcement officers' 
established investigative tools and procedures. Further, granting access 
to investigative files and records could disclose the identity of 
confidential sources and other informers and the nature of the 
information which they supplied, thereby endangering the life or 
physical safety of those sources of information by exposing them to 
possible reprisals for having provided information relating to the 
criminal activities of those individuals who are the subjects of the 
investigative files and records; confidential sources and other 
informers might refuse to provide criminal investigators with valuable 
information if they could not be secure in the knowledge that their 
identities would not be revealed through disclosure of either their 
names or the nature of the information they supplied, and this would 
seriously impair the ability of the Federal Emergency Management Agency 
to carry out its mandate to enforce criminal and related laws. 
Additionally, providing access to records contained in the above-listed 
system of records could reveal the identities of undercover law 
enforcement personnel who compiled information regarding individual's 
criminal activities, thereby endangering the life or physical safety of 
those undercover personnel or their families by exposing them to 
possible reprisals.

[[Page 58]]

    (iii) 5 U.S.C. 552a(d) (2), (3) and (4), (e)(4)(H) and (f)(4), which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in paragraph (b)(2)(ii) of this section, enable 
individuals to contest (seek amendment to) the content of records 
contained in a system of records and require an agency to note an 
amended record and to provide a copy of an individual's statement (of 
disagreement with the agency's refusal to amend a record) to persons or 
other agencies to whom the record has been disclosed. The Federal 
Emergency Management Agency believes that the reasons set forth in 
paragraph (b)(2)(ii) of this section are equally applicable to this 
paragraph and, accordingly, those reasons are hereby incorporated herein 
by reference.
    (iv) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the date, nature and purpose 
of each disclosure of a record and the name and address of the 
recipient. The Federal Emergency Management Agency believes that 
application of this provision to the above-listed system of records 
would impair the ability of other law enforcement agencies to make 
effective use of information provided by the Federal Emergency 
Management Agency in connection with the investigation, detection and 
apprehension of violators of the criminal laws enforced by those other 
law enforcement agencies. Making accountings of disclosure available to 
violators or possible violators would alert those individuals to the 
fact that another agency is conducting an investigation into their 
criminal activities, and this could reveal the geographic location of 
the other agency's investigation, the nature and purpose of that 
investigation, and the dates on which that investigation was active. 
Violators possessing such knowledge would thereby be able to take 
appropriate measures to avoid detection or apprehension by altering 
their operations, by transferring their criminal activities to other 
geographic areas or by destroying or concealing evidence which would 
form the basis for their arrest. In addition, providing violators with 
accountings of disclosure would alert those individuals to the fact that 
the Federal Emergency Management Agency has information regarding their 
criminal activities and could inform those individuals of the general 
nature of that information; this, in turn, would afford those 
individuals a better opportunity to take appropriate steps to avoid 
detection or apprehension for violations of criminal and related laws.
    (v) 5 U.S.C. 552a(c)(4) requires that an agency inform any person or 
other agency about any correction or notation of dispute made by the 
agency in accordance with 5 U.S.C. 552a(d) of any record that has been 
disclosed to the person or agency if an accounting of the disclosure was 
made. Since this provision is dependent on an individual's having been 
provided an opportunity to contest (seek amendment to) records 
pertaining to him/her, and since the above-listed system of records is 
proposed to be exempt from those provisions of 5 U.S.C. 552a relating to 
amendments of records as indicated in paragraph (b)(2)(iii) of this 
section, the Federal Emergency Management Agency believes that this 
provision should not be applicable to the above system of records.
    (vi) 5 U.S.C. 552a(e)(4)(I) requires that an agency publish a public 
notice listing the categories of sources for information contained in a 
system of records. The categories of sources of this system of records 
have been published in the Federal Register in broad generic terms in 
the belief that this is all that subsection (e)(4)(I) of the Act 
requires. In the event, however, that this subsection should be 
interpreted to require more detail as to the identity of sources of the 
records in this system, exemption from this provision is necessary in 
order to protect the confidentiality of the sources of criminal and 
other law enforcement information. Such exemption is further necessary 
to protect the privacy and physical safety of witnesses and informants.
    (vii) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required

[[Page 59]]

to be accomplished by statute or executive order. The term maintain as 
defined in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' 
At the time that information is collected by the Federal Emergency 
Management Agency, there is often insufficient time to determine whether 
the information is relevant and necessary to accomplish a purpose of the 
Federal Emergency Management Agency; in many cases information collected 
may not be immediately susceptible to a determination of whether the 
information is relevant and necessary, particularly in the early stages 
of an investigation, and in many cases, information which initially 
appears to be irrelevant or unnecessary may, upon further evaluation or 
upon continuation of the investigation, prove to have particular 
relevance to an enforcement program of the Federal Emergency Management 
Agency. Further, not all violations of law discovered during a criminal 
investigation fall within the investigative jurisdiction of the Federal 
Emergency Management Agency; in order to promote effective law 
enforcement, it often becomes necessary and desirable to disseminate 
information pertaining to such violations to other law enforcement 
agencies which have jurisdiction over the offense to which the 
information relates. The Federal Emergency Management Agency should not 
be placed in a position of having to ignore information relating to 
violations of law not within its jurisdiction when that information 
comes to the attention of the Federal Emergency Management Agency 
through the conduct of a lawful FEMA investigation. The Federal 
Emergency Management Agency, therefore, believes that it is appropriate 
to exempt the above-listed system of records from the provisions of 5 
U.S.C. 552a(e)(1).
    (viii) 5 U.S.C. 552a(e)(2) requires that an agency collect 
information to the greatest extent practicable directly from the subject 
individual when the information may result in adverse determinations 
about an individual's rights, benefits, and privileges under Federal 
programs. The Federal Emergency Management Agency believes that 
application of this provision to the above-listed system of records 
would impair the ability of the Federal Emergency Management Agency to 
conduct investigations and to identify or detect violators of criminal 
or related laws for the following reasons:
    (A) Most information collected about an individual under criminal 
investigations is obtained from third parties such as witnesses and 
informers, and it is usually not feasible to rely upon the subject of 
the investigation as a source for information regarding his/her criminal 
activities, (B) an attempt to obtain information from the subject of a 
criminal investigation will often alert that individual to the existence 
of an investigation, thereby affording the individual an opportunity to 
attempt to conceal his/her criminal activities so as to avoid 
apprehension, (C) in certain instances, the subject of a criminal 
investigation is not required to supply information to criminal 
investigators as a matter of legal duty, and (D) during criminal 
investigations it is often a matter of sound investigative procedures to 
obtain information from a variety of sources in order to verify 
information already obtained.
    (ix) 5 U.S.C. 552a(e)(3) requires that an agency inform each 
individual whom it asks to supply information, either on the form which 
the agency uses to collect the information or on a separate form which 
can be retained by the individual, with the following information: The 
authority which authorizes the solicitation of the information and 
whether disclosure of such information is mandatory or voluntary; the 
principal purposes for which the information is intended to be used; the 
routine uses which may be made of the information; and the effects on 
the individual of not providing all or part of the requested 
information. The Federal Emergency Management Agency believes that the 
above-listed system of records should be exempted from this provision in 
order to avoid adverse effects on its ability to identify or detect 
violators of criminal or related laws. In many cases, information is 
obtained by confidential sources, other informers or undercover law 
enforcement officers under circumstances where it is necessary that the 
true purpose of their actions be kept secret so as to avoid

[[Page 60]]

alerting the subject of the investigation or his/her associates that a 
criminal investigation is in process. Further, if it became known that 
the undercover officer was assisting in a criminal investigation, that 
officer's life or physical safety could be endangered through reprisal, 
and, under such circumstances it may not be possible to continue to 
utilize that officer in the investigation. In many cases, individuals, 
for personal reasons, would feel inhibited in talking to a person 
representing a criminal law enforcement agency but would be willing to 
talk to a confidential source or undercover officer who they believe is 
not involved in law enforcement activities. In addition, providing a 
source of information with written evidence that he was a source, as 
required by this provision, could increase the likelihood that the 
source of information would be the subject of retaliatory action by the 
subject of the investigation. Further, application of this provision 
could result in an unwarranted invasion of the personal privacy of the 
subject of the criminal investigation, particularly where further 
investigation would result in a finding that the subject was not 
involved in any criminal activity.
    (x) 5 U.S.C. 552a(e)(5) requires that an agency maintain all records 
used by the agency in making any determination about any individual with 
such accuracy, relevance, timeliness and completeness as is reasonably 
necessary to assure fairness to the individual in the determination. 
Since 5 U.S.C. 552a(a)(3) defines ``maintain'' to include ``collect'' 
and ``disseminate,'' application of this provision to the above-listed 
system of records would hinder the initial collection of any information 
which could not, at the moment of collection, be determined to be 
accurate, relevant, timely and complete. Similarly, application of this 
provision would seriously restrict the necessary flow of information 
from the Federal Emergency Management Agency to other law enforcement 
agencies when a FEMA investigation revealed information pertaining to a 
violation of law which was under investigative jurisdiction of another 
agency. In collecting information during the course of a criminal 
investigation, it is not possible or feasible to determine accuracy, 
relevance, timeliness or completeness prior to collection of the 
information; in disseminating information to other law enforcement 
agencies it is often not possible to determine accuracy, relevance, 
timeliness or completeness prior to dissemination because the 
disseminating agency may not have the expertise with which to make such 
determinations. Further, information which may initially appear to be 
inaccurate, irrelevant, untimely or incomplete may, when gathered, 
grouped, and evaluated with other available information, become more 
pertinent as an investigation progresses. In addition, application of 
this provision could seriously impede criminal investigators and 
intelligence analysts in the exercise of their judgment in reporting on 
results obtained during criminal investigations. The Federal Emergency 
Management Agency believes that it is appropriate to exempt the above-
listed system of records from the provisions of 5 U.S.C. 552a(e)(5).
    (xi) 5 U.S.C. 552a(e)(8) requires that an agency make reasonable 
effort to serve notice on an individual when any record on the 
individual is made available to any person under compulsory legal 
process when such process becomes a matter of public record. The Federal 
Emergency Management Agency believes that the above-listed system of 
records should be exempt from this provision in order to avoid revealing 
investigative techniques and procedures outlined in those records and in 
order to prevent revelation of the existence on an on-going 
investigation where there is a need to keep the existence of the 
investigation secret.
    (xii) 5 U.S.C. 552a(g) provides civil remedies to an individual for 
an agency's refusal to amend a record or to make a review of a request 
for amendment; for an agency's refusal to grant access to a record; for 
an agency's failure to maintain accurate, relevant, timely and complete 
records which are used to make a determination which is adverse to the 
individual; and for an agency's failure to comply with any other 
provision of 5 U.S.C. 552a in such a way as to have an adverse effect on 
an individual. The Federal Emergency Management Agency believes that the

[[Page 61]]

above-listed system of records should be exempted from this provision to 
the extent that the civil remedies provided therein may relate to 
provisions of 5 U.S.C. 552a from which the above-listed system of 
records is proposed to be exempt. Since the provisions of 5 U.S.C. 552a 
enumerated in paragraphs (b)(2)(i) through (xi) of this section are 
proposed to be inapplicable to the above-listed systems of records for 
the reasons stated therein, there should be no corresponding civil 
remedies for failure to comply with the requirements of those provisions 
to which the exemption is proposed to apply. Further, the Federal 
Emergency Management Agency believes that application of this provision 
to the above-listed system of records would adversely affect its ability 
to conduct criminal investigations by exposing to civil court action 
every stage of the criminal investigative process in which information 
is compiled or used in order to identify, detect, or otherwise 
investigate persons suspected or known to be engaged in criminal 
conduct.
    (xiii) Individuals may not have access to another agency's records, 
which are contained in files maintained by the Federal Emergency 
Management Agency, when that other agency's regulations provide that 
such records are subject to general exemption under 5 U.S.C. 552a(j). If 
such exempt records are within a request for access, FEMA will advise 
the individual of their existence and of the name and address of the 
source agency. For any further information concerning the record and the 
exemption, the individual must contact that source agency.

[45 FR 64580, Sept. 30, 1980]



Sec. 6.87  Specific exemptions.

    (a) Exempt under 5 U.S.C. 552a(k)(1). The Director, Federal 
Emergency Management Agency has determined that certain systems of 
records may be exempt from the requirements of (c)(3) and (d) pursuant 
to 5 U.S.C. 552a(k)(1) to the extent that the system contains any 
information properly classified under Executive Order 12356 or any 
subsequent Executive order and which are required to be kept secret in 
the interest of national defense or foreign policy. To the extent that 
this occurs, such records in the following systems would be exempt:

Claims (litigation) (FEMA/GC-1)--Limited Access
FEMA Enforcement (Compliance) (FEMA/GC-2)--Limited Access
General Investigative Files (FEMA/IG-1)--Limited Access
Security Management Information System (FEMA/SEC-1)--Limited Access

    (b) Exempt under 5 U.S.C. 552a(k)(2) from the requirements of 5 
U.S.C. 552a (c)(3), (d), (e)(1), (e)(4) (G), (H), and (I), and (f). The 
Federal Emergency Management Agency will not deny individuals access to 
information which has been used to deny them a right, privilege, or 
benefit to which they would otherwise be entitled.
    (1) Exempt systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(k)(2), shall be 
exempt from the provisions of 5 U.S.C. 552a(k)(2) listed in paragraph 
(b) of this section.

Claims (litigation) (FEMA/GC-1)--Limited Access
FEMA Enforcement (Compliance) (FEMA/GC-2)--Limited Access
General Investigative Files (FEMA/IG-1)--Limited Access
Equal Employment Opportunity Complaints of Discrimination Files (FEMA/
PER-2)--Limited Access

    (2) Reasons for exemptions. (i) 5 U.S.C. 552a (e)(4)(G) and (f)(1) 
enable individuals to be notified whether a system of records contains 
records pertaining to them. The Federal Emergency Management Agency 
believes that application of these provisions to the above-listed 
systems of records would impair the ability of FEMA to successfully 
complete investigations and inquiries of suspected violators of civil 
and criminal laws and regulations under its jurisdiction. In many cases 
investigations and inquiries into violations of civil and criminal laws 
and regulations involve complex and continuing patterns of behavior. 
Individuals, if informed, that they have been identified as suspected 
violators of civil or criminal laws and regulations, would have an 
opportunity to take measures to prevent detection of illegal action so 
as to avoid prosecution or the imposition of civil sanctions. They would 
also be able to learn the nature and location of

[[Page 62]]

the investigation or inquiry, the type of surveillance being utilized, 
and they would be able to transmit this knowledge to co-conspirators. 
Finally, violators might be given the opportunity to destroy evidence 
needed to prove the violation under investigation or inquiry.
    (ii) 5 U.S.C. 552a (d)(1), (e)(4)(H) and (f)(2), (3) and (5) enable 
individuals to gain access to records pertaining to them. The Federal 
Emergency Management Agency believes that application of these 
provisions to the above-listed systems of records would impair its 
ability to complete or continue civil or criminal investigations and 
inquiries and to detect violators of civil or criminal laws. Permitting 
access to records contained in the above-listed systems of records would 
provide violators with significant information concerning the nature of 
the civil or criminal investigation or inquiry. Knowledge of the facts 
developed during an investigation or inquiry would enable violators of 
criminal and civil laws and regulations to learn the extent to which the 
investigation or inquiry has progressed, and this could provide them 
with an opportunity to destroy evidence that would form the basis for 
prosecution or the imposition of civil sanctions. In addition, knowledge 
gained through access to investigatory material could alert a violator 
to the need to temporarily postpone commission of the violation or to 
change the intended point where the violation is to be committed so as 
to avoid detection or apprehension. Further, access to investigatory 
material would disclose investigative techniques and procedures which, 
if known, could enable violators to structure their future operations in 
such a way as to avoid detection or apprehension, thereby neutralizing 
investigators' established and effective investigative tools and 
procedures. In addition, investigatory material may contain the identity 
of a confidential source of information or other informer who would not 
want his/her identity to be disclosed for reasons of personal privacy or 
for fear of reprisal at the hands of the individual about whom he/she 
supplied information. In some cases mere disclosure of the information 
provided by an informer would reveal the identity of the informer either 
through the process of elimination or by virtue of the nature of the 
information supplied. If informers cannot be assured that their 
identities (as sources for information) will remain confidential, they 
would be very reluctant in the future to provide information pertaining 
to violations of criminal and civil laws and regulations, and this would 
seriously compromise the ability of the Federal Emergency Management 
Agency to carry out its mission. Further, application of 5 U.S.C. 552a 
(d)(1), (e)(4)(H) and (f)(2), (3) and (5) to the above-listed systems of 
records would make available attorney's work product and other documents 
which contain evaluations, recommendations, and discussions of on-going 
civil and criminal legal proceedings; the availability of such documents 
could have a chilling effect on the free flow of information and ideas 
within the Federal Emergency Management Agency which is vital to the 
agency's predecisional deliberative process, could seriously prejudice 
the agency's or the Government's position in a civil or criminal 
litigation, and could result in the disclosure of investigatory material 
which should not be disclosed for the reasons stated above. It is the 
belief of the Federal Emergency Management Agency that, in both civil 
actions and criminal prosecutions, due process will assure that 
individuals have a reasonable opportunity to learn of the existence of, 
and to challenge, investigatory records and related materials which are 
to be used in legal proceedings.
    (iii) 5 U.S.C. 552a (d)(2), (3) and (4), (e)(4)(H) and (f)(4) which 
are dependent upon access having been granted to records pursuant to the 
provisions cited in paragraph (b)(2)(ii) of this section, enable 
individuals to contest (seek amendment to) the content of records 
contained in a system of records and require an agency to note an 
amended record and to provide a copy of an individual's statement (of 
disagreement with the agency's refusal to amend a record) to persons or 
other agencies to whom the record has been disclosed. The Federal 
Emergency Management Agency believes that the reasons set forth in 
paragraphs (b)(2)(i)

[[Page 63]]

of this section are equally applicable to this paragraph, and, 
accordingly, those reasons are hereby incorporated herein by reference.
    (iv) 5 U.S.C. 552a(c)(3) requires that an agency make accountings of 
disclosures of records available to individuals named in the records at 
their request; such accountings must state the date, nature, and purpose 
of each disclosure of a record and the name and address of the 
recipient. The Federal Emergency Management Agency believes that 
application of this provision to the above-listed systems of records 
would impair the ability of the Federal Emergency Management Agency and 
other law enforcement agencies to conduct investigations and inquiries 
into civil and criminal violations under their respective jurisdictions. 
Making accountings available to violators would alert those individuals 
to the fact that the Federal Emergency Management Agency or another law 
enforcement authority is conducting an investigation or inquiry into 
their activities, and such accountings could reveal the geographic 
location of the investigation or inquiry, the nature and purpose of the 
investigation or inquiry and the nature of the information disclosed, 
and the date on which that investigation or inquiry was active. 
Violators possessing such knowledge would thereby be able to take 
appropriate measures to avoid detection or apprehension by altering 
their operations, transferring their activities to other locations or 
destroying or concealing evidence which would form the basis for 
prosecution or the imposition of civil sanctions.
    (v) 5 U.S.C. 552a(e)(1) requires that an agency maintain in its 
records only such information about an individual as is relevant and 
necessary to accomplish a purpose of the agency required to be 
accomplished by statute or executive order. The term maintain as defined 
in 5 U.S.C. 552a(a)(3) includes ``collect'' and ``disseminate.'' At the 
time that information is collected by the Federal Emergency Management 
Agency there is often insufficient time to determine whether the 
information is relevant and necessary to accomplish a purpose of the 
Federal Emergency Management Agency; in many cases information collected 
may not be immediately susceptible to a determination of whether the 
information is relevant and necessary, particularly in the early stages 
of investigation or inquiry, and in many cases information which 
initially appears to be irrelevant or unnecessary may, upon further 
evaluation or upon continuation of the investigation or inquiry, prove 
to have particular relevance to an enforcement program of the Federal 
Emergency Management Agency. Further, not all violations of law 
uncovered during a Federal Emergency Management Agency inquiry fall 
within the civil or criminal jurisdiction of the Federal Emergency 
Management Agency; in order to promote effective law enforcement, it 
often becomes necessary and desirable to disseminate information 
pertaining to such violations to other law enforcement agencies which 
have jurisdiction over the offense to which the information relates. The 
Federal Emergency Management Agency should not be placed in a position 
of having to ignore information relating to violations of law not within 
its jurisdiction when that information comes to the attention of the 
Federal Emergency Management Agency through the conduct of a lawful 
FEMAs civil or criminal investigation or inquiry. The Federal Emergency 
Management Agency therefore believes that it is appropriate to exempt 
the above-listed systems of records from the provisions of 5 U.S.C. 
552a(e)(1).
    (c) Exempt under 5 U.S.C. 552a(k)(5). The Director, Federal 
Emergency Management Agency has determined that certain systems of 
records are exempt from the requirements of (c)(3) and (d) of 5 U.S.C. 
552a.
    (1) Exempt systems. The following systems of records, which contain 
information of the type described in 5 U.S.C. 552a(k)(5), shall be 
exempted from the provisions of 5 U.S.C. 552a listed in paragraph (c) of 
this section.

Claims (litigation) (FEMA/GC-1)--Limited Access
FEMA Enforcement (Compliance) (FEMA/GC-2)--Limited Access
General Investigative Files (FEMA/IG-2)--Limited Access
Security Management Information Systems (FEMA/SEC-1)--Limited Access


[[Page 64]]


    (2) Reasons for exemptions. All information about individuals in 
these records that meet the criteria stated in 5 U.S.C. 552a(k)(5) is 
exempt from the requirements of 5 U.S.C. 552a (c)(3) and (d). These 
provisions of the Privacy Act relate to making accountings of disclosure 
available to the subject and access to and amendment of records. These 
exemptions are claimed because the system of records entitled, FEMA/SEC-
1, Security Management Information System, contains investigatory 
material compiled solely for the purpose of determining suitability, 
eligibility, or qualifications for access to classified information or 
classified Federal contracts, but only to the extent that the disclosure 
would reveal the identity of a source who furnished information to the 
Government under an express promise or, prior to September 27, 1975, 
under an implied promise that the identity of the source would be held 
in confidence. During the litigation process and investigations, it is 
possible that certain records from the system of records entitled, FEMA/
SEC-1, Security Management System may be necessary and relevant to the 
litigation or investigation and included in these systems of records. To 
the extent that this occurs, the Director, FEMA, has determined that the 
records would also be exempted from subsections (c)(3) and (d) pursuant 
to 5 U.S.C. 552a(k)(5) to protect such records. A determination will be 
made at the time of the request for a record concerning whether specific 
information would reveal the identity of a source. This exemption is 
required in order to protect the confidentiality of the sources of 
information compiled for the purpose of determining access to classified 
information. This confidentiality helps maintain the Government's 
continued access to information from persons who would otherwise refuse 
to give it.

[45 FR 64580, Sept. 30, 1980, as amended at 47 FR 54816, Dec. 6, 1982; 
52 FR 5114, Feb. 19, 1987]



PART 7--NONDISCRIMINATION IN FEDERALLY-ASSISTED PROGRAMS (FEMA REG. 5)--Table of Contents




         Subpart A--Nondiscrimination in FEMA Programs--General

Sec.
7.1  Purpose.
7.2  Definitions.
7.3  Application of this regulation.
7.4  Further application of this regulation.
7.5  Specific discriminatory actions prohibited.
7.6  Life, health, and safety.
7.7  Assurances required.
7.8  Elementary and secondary schools.
7.9  Assurances from institutions.
7.10  Compliance information.
7.11  Conduct of investigations.
7.12  Procedure for effecting compliance.
7.13  Hearings.
7.14  Decisions and notices.
7.15  Judicial review.
7.16  Effect on other regulations; forms and instructions.

                         Subparts B-D [Reserved]

    Subpart E--Nondiscrimination on the Basis of Age in FEMA Program 
            Activities Receiving Federal Financial Assistance

                                 General

7.910  What is the purpose of the Age Discrimination Act of 1975?
7.911  What is the purpose of FEMA's age discrimination regulation?
7.912  To what programs does this regulation apply?
7.913  Definition of terms used in this regulation.

              Standards for Determining Age Discrimination

7.920  Rules against age discrimination.
7.921  Exceptions to the rules against age discrimination: Normal 
          operation or statutory objective of any program or activity.
7.922  Exceptions to the rules against age discrimination: Reasonable 
          factors other than age.
7.923  Burden of proof for exceptions.
7.924  Affirmative action by recipient.
7.925  Special benefits for children and the elderly.
7.926  Age distinctions contained in FEMA regulations.

[[Page 65]]

                        Duties of FEMA Recipients

7.930  General responsibilities.
7.931  Notice to subrecipients and beneficiaries.
7.932  Assurance of compliance and recipient assessment of age 
          distinctions.
7.933  Information requirement.

         Investigation, Conciliation, and Enforcement Procedures

7.940  Compliance reviews.
7.941  Complaints.
7.942  Mediation.
7.943  Investigation.
7.944  Prohibition against intimidation or retaliation.
7.945  Compliance procedure.
7.946  Hearings, decisions, post-termination proceedings.
7.947  Remedial action by recipient.
7.948  Alternate funds disbursal procedure.
7.949  Exhaustion of administrative remedies.

    Source: 30 FR 321, Jan. 9, 1965, unless otherwise noted. 
Redesignated at 45 FR 44575, July 1, 1980.



         Subpart A--Nondiscrimination in FEMA Programs--General

    Authority: FEMA Reg. 5 issued under sec. 602, 78 Stat. 252; 42 
U.S.C. 2000 d-1; 42 U.S.C. 1855-1885g; 50 U.S.C. 404.

    Source: 30 FR 321, Jan. 9, 1965, unless otherwise noted. 
Redesignated at 45 FR 44575, July 1, 1980. Redesignated at 55 FR 23078, 
June 6, 1990.



Sec. 7.1  Purpose.

    The purpose of this regulation is to effectuate the provisions of 
title VI of the Civil Rights Act of 1964 (hereafter referred to as the 
``Act'') to the end that no person in the United States shall, on the 
ground of race, color, or national origin, be excluded from 
participation in, be denied the benefits of, or be otherwise subjected 
to discrimination under any program or activity receiving Federal 
financial assistance from the Federal Emergency Management Agency.



Sec. 7.2  Definitions.

    As used in this regulation:
    (a) The term responsible agency official with respect to any program 
receiving Federal financial assistance means the Director of the Federal 
Emergency Management Agency or other official of the agency who by law 
or by delegation has the principal responsibility within the agency for 
the administration of the law extending such assistance.
    (b) The term United States means the States of the United States, 
the District of Columbia, Puerto Rico, the Virgin Islands, American 
Samoa, Guam, Wake Island, the Canal Zone, and the territories and 
possessions of the United States, and the term State means any one of 
the foregoing.
    (c) The term Federal financial assistance includes (1) grants and 
loans of Federal funds, (2) the grant or donation of Federal property 
and interests in property, (3) the detail of Federal personnel, (4) the 
sale and lease of, and the permission to use (on other than a casual or 
transient basis), Federal property or any interest in such property 
without consideration or at a nominal consideration, or at a 
consideration which is reduced for the purpose of assisting the 
recipient, or in recognition of the public interest to be served by such 
sale or lease to the recipient, and (5) any Federal agreement, 
arrangement, or other contract which has as one of its purposes the 
provision of assistance.
    (d) The term program includes any program, project, or activity for 
the provision of services, financial aid, or other benefits to 
individuals (including education or training, health, welfare, 
rehabilitation, housing, or other services, whether provided through 
employees of the recipient of Federal financial assistance or provided 
by others through contracts or other arrangements with the recipient, 
and including work opportunities and cash or loan or other assistance to 
individuals), or for the provision of facilities for furnishing 
services, financial aid or other benefits to individuals. The services, 
financial aid, or other benefits provided under a program receiving 
Federal financial assistance shall be deemed to include any services, 
financial aid, or other benefits provided with the aid of Federal 
financial assistance or with the aid of any non-Federal funds, property, 
or other resources required to be expended or made available for the 
program to meet matching requirements or other conditions which must be 
met

[[Page 66]]

in order to receive the Federal financial assistance, and to include any 
services, financial aid, or other benefits provided in or through a 
facility provided with the aid of Federal financial assistance or such 
non-Federal resources.
    (e) The term facility includes all or any portion of structure, 
equipment, or other real or personal property or interests therein, and 
the provision of facilities includes the construction, expansion, 
renovation, remodeling, alteration or acquisition of facilities.
    (f) The term recipient means any State, political subdivision of any 
State, or instrumentality of any State or political subdivision, any 
public or private agency, institution, or organization, or other entity, 
or any individual, in any State, to whom Federal financial assistance is 
extended, directly or through another recipient, for any program, 
including any successor, assign, or transferee thereof, but such term 
does not include any ultimate beneficiary under any such program.
    (g) The term primary recipient means any recipient which is 
authorized or required to extend Federal financial assistance to another 
recipient for the purpose of carrying out a program.
    (h) The term applicant means one who submits an application, 
request, or plan required to be approved by a responsible agency 
official, or by a primary recipient, as a condition to eligibility for 
Federal financial assistance, and the term application means such an 
application, request, or plan.



Sec. 7.3  Application of this regulation.

    No person in the United States shall, on the ground of race, color, 
or national origin, be excluded from participation in, be denied the 
benefits of, or be otherwise subjected to discrimination by those 
receiving assistance under the ``Federal Disaster Assistance'' program 
(Pub. L. 81-875; 42 U.S.C. 1855-1855g), or under the ``Interim Emergency 
Management of Resources'' program (section 103 of the National Security 
Act of 1947; Pub. L. 80-253, as amended; 50 U.S.C. 404).



Sec. 7.4  Further application of this regulation.

    This regulation applies to any program for which Federal financial 
assistance is authorized under a law administered by the Federal 
Emergency Management Agency. It applies to money paid, property 
transferred, or other Federal financial assistance extended under any 
such program after the effective date of the regulation pursuant to an 
application approved prior to such effective date. This regulation does 
not apply to (a) any Federal financial assistance by way of insurance or 
guaranty contracts, (b) money paid, property transferred, or other 
assistance extended under any such program before the effective date of 
this regulation, (c) any assistance to any individual who is the 
ultimate beneficiary under any such program, or (d) any employment 
practice, under such program, of any employer, employment agency, or 
labor organization.

(Reorganization Plan No. 3 of 1978, E.O. 12127 and E.O. 12148)

[30 FR 321, Jan. 9, 1965. Redesignated at 45 FR 44575, July 1, 1980, as 
amended at 48 FR 44543, Sept. 29, 1983]



Sec. 7.5  Specific discriminatory actions prohibited.

    (a) A recipient under any program to which this regulation applies 
may not, directly or through contractual or other arrangements, on 
ground of race, color, or national origin:
    (1) Deny any individual any service, financial aid, or other benefit 
provided under the program;
    (2) Provide any service, financial aid, or other benefit to an 
individual which is different, or is provided in a different manner, 
from that provided to others under the program;
    (3) Subject an individual to segregation or separate treatment in 
any matter related to his receipt of any service, financial aid, or 
other benefit under the program;
    (4) Restrict an individual in any way in the enjoyment of any 
advantage or privilege enjoyed by others receiving any service, 
financial aid, or other benefit under the program;

[[Page 67]]

    (5) Treat an individual differently from others in determining 
whether he satisfies any admission, enrollment, quota, eligibility, 
membership or other requirement or condition which individuals must meet 
in order to be provided any service, financial aid, or other benefit 
provided under the program;
    (6) Deny an individual an opportunity to participate in the program 
through the provision of services or otherwise or afford him an 
opportunity to do so which is different from that afforded others under 
the program.
    (b) A recipient, in determining the types of services, financial 
aid, or other benefits, or facilities which will be provided under any 
such program, or the class of individuals to whom, or the situations in 
which, such services, financial aid, other benefits, or facilities will 
be provided under any such program, or the class of individuals to be 
afforded an opportunity to participate in any such program, may not, 
directly or through contractual or other arrangements, utilize criteria 
or methods of administration which have the effect of subjecting 
individuals to discrimination because of their race, color, or national 
origin, or have the effect of defeating or substantially impairing 
accomplishment of the objectives of the program as respect individuals 
of a particular race, color, or national origin.
    (c) As used in this section the services, financial aid, or other 
benefits provided under a program receiving Federal financial assistance 
shall be deemed to include any service, financial aid, or other benefit 
provided in or through a facility provided with the aid of Federal 
financial assistance.
    (d) The enumeration of specific forms of prohibited discrimination 
in this section does not limit the generality of the prohibition in 
section 4.



Sec. 7.6  Life, health, and safety.

    Notwithstanding the provisions of section 5, a recipient of Federal 
financial assistance shall not be deemed to have failed to comply with 
section 3, if immediate provision of a service or other benefit to an 
individual is necessary to prevent his death or serious impairment of 
his health or safety.



Sec. 7.7  Assurances required.

    Every application for Federal financial assistance to carry out a 
program to which this regulation applies, and every application for 
Federal financial assistance to provide a facility shall, as a condition 
to its approval and the extension of any Federal financial assistance 
pursuant to the application, contain or be accompanied by an assurance 
that the program will be conducted or the facility operated in 
compliance with all requirements imposed by or pursuant to this 
regulation. In the case of an application for Federal financial 
assistance to provide real property or structures thereon, the assurance 
shall obligate the recipient, or, in the case of a subsequent transfer, 
the transferee, for the period during which the real property or 
structures are used for a purpose for which the Federal financial 
assistance is extended or for another purpose involving the provision of 
similar services or benefits. In the case of personal property the 
assurance shall obligate the recipient for the period during which he 
retains ownership or possession of the property. In all other cases the 
assurance shall obligate the recipient for the period during which 
Federal financial assistance is extended pursuant to the application. 
The responsible agency official shall specify the form of the foregoing 
assurances for each program, and the extent to which like assurances 
will be required of subgrantee, contractors and subcontractors, 
transferees, successors in interest, and other participants in the 
program. Any such assurance shall include provisions which give the 
United States a right to seek its judicial enforcement.



Sec. 7.8  Elementary and secondary schools.

    The requirements of section 7 with respect to any elementary or 
secondary school or school system shall be deemed to be satisfied if 
such school or school system (a) is subject to a final order of a court 
of the United States for the desegregation of such school or school 
system, and provides an assurance that it will comply with such order, 
including any future modification of such order, or (b) submits a plan 
for the desegregation of such school or

[[Page 68]]

school system which the United States Commissioner of Education 
determines is adequate to accomplish the purpose of the Act and this 
regulation, and provides reasonable assurance that it will carry out 
such plans; in any case of continuing Federal financial assistance the 
responsible agency official may reserve the right to redetermine, after 
such period as may be specified by him, the adequacy of the plan to 
accomplish the purposes of the Act and this regulation. In any case to 
which a final order of a court of the United States for the 
desegregation of such school or school system is entered after 
submission of such a plan, such plan shall be revised to conform to such 
final order, including any future modification of such order.



Sec. 7.9  Assurances from institutions.

    (a) In the case of any application for Federal financial assistance 
to an institution of higher education, the assurance required by section 
7 shall extend to admission practices and to all other practices 
relating to the treatment of students.
    (b) The assurances required with respect to an institution of higher 
education, hospital, or any other institution, insofar as the assurance 
relates to the institution's practices with respect to admission or 
other treatment of individuals as students, patients, or clients of the 
institutions or to the opportunity to participate in the provision of 
services or other benefits to such individuals, shall be applicable to 
the entire institution unless the applicant establishes, to the 
satisfaction of the Director of the Federal Emergency Management Agency 
that the institution's practices in designated parts or programs of the 
institution will in no way affect its practices in the program of the 
institution for which Federal financial assistance is sought, or the 
beneficiaries of or participants in such program. If in any such case 
the assistance sought is for the construction of a facility or part of a 
facility, the assurance shall in any event extend to the entire facility 
and to facilities operated in connection therewith.



Sec. 7.10  Compliance information.

    (a) Cooperation and assistance. The responsible official in the 
Federal Emergency Management Agency shall to the fullest extent 
practicable seek the cooperation of recipients in obtaining compliance 
with this regulation and shall provide assistance and guidance to 
recipients to help them comply voluntarily with this regulation.
    (b) Compliance reports. Each recipient shall keep such records and 
submit to the responsible agency official or his designee timely, 
complete, and accurate compliance reports at such times, and in such 
form and containing such information, as the responsible agency official 
or his designee may determine to be necessary to enable him to ascertain 
whether the recipient has complied or is complying with this regulation. 
In the case of any program under which a primary recipient extends 
Federal financial assistance to any other recipient, such other 
recipient shall also submit such compliance reports to the primary 
recipient as may be necessary to enable the primary recipient to carry 
out its obligations under this regulation.
    (c) Access to sources of information. Each recipient shall permit 
access by the responsible agency official or his designee during normal 
business hours to such of its books, records, accounts, and other 
sources of information, and its facilities as may be pertinent to 
ascertain compliance with this regulation. Where any information 
required of a recipient is in the exclusive possession of any other 
agency, institution or person and this agency, institution or person 
shall fail or refuse to furnish this information, the recipient shall so 
certify in its report and shall set forth what efforts it has made to 
obtain the information.
    (d) Information to beneficiaries and participants. Each recipient 
shall make available to participants, beneficiaries, and other 
interested persons such information regarding the provisions of this 
regulation and its applicability to the program under which the 
recipient receives Federal financial assistance, and make such 
information available to them in such manner, as the responsible agency 
official finds necessary to apprise such persons of the protection

[[Page 69]]

against discrimination assured them by the Act and this regulation.



Sec. 7.11  Conduct of investigations.

    (a) Periodic compliance reviews. The responsible agency official or 
his designee shall from time to time review the practices of recipients 
to determine whether they are complying with this regulation.
    (b) Complaints. Any person who believes himself or any specific 
class of individuals to be subjected to discrimination prohibited by 
this regulation may by himself or by a representative file with the 
National Headquarters or any Regional Office of the Federal Emergency 
Management Agency a written complaint. A complaint must be filed not 
later than 90 days from the date of the alleged discrimination, unless 
the time for filing is extended by the responsible agency official or 
his designee.
    (c) Investigations. The responsible agency official or his designee 
will make a prompt investigation whenever a compliance review, report, 
complaint, or any other information indicates a possible failure to 
comply with this regulation. The investigation should include, where 
appropriate, a review of the pertinent practices and policies of the 
recipient, the circumstances under which the possible noncompliance with 
this regulation occurred, and other factors relevant to a determination 
as to whether the recipient has failed to comply with this regulation.
    (d) Resolution of matters. (1) If an investigation pursuant to 
paragraph (c) of this section indicates a failure to comply with this 
regulation, the responsible agency official or his designee will so 
inform the recipient and the matter will be resolved by informal means 
whenever possible. If it has been determined that the matter cannot be 
resolved by informal means, action will be taken as provided for in 
section 12.
    (2) If an investigation does not warrant action pursuant to 
paragraph (d)(1) of this section the responsible agency official or his 
designee will so inform the recipient and the complainant, if any, in 
writing.
    (e) Intimidatory or retaliatory acts prohibited. No recipient or 
other person shall intimidate, threaten, coerce, or discriminate against 
any individual for the purpose of interfering with any right or 
privilege secured by section 601 of the Act or this regulation, or 
because he has made a complaint, testified, assisted, or participated in 
any manner in an investigation, proceeding, or hearing under this 
regulation. The identity of complainants shall be kept confidential 
except to the extent necessary to carry out the purposes of this 
regulation, including the conduct of any investigation, hearing, or 
judicial proceeding arising thereunder.



Sec. 7.12  Procedure for effecting compliance.

    (a) General. If there appears to be a failure or threatened failure 
to comply with this regulation, and if the noncompliance or threatened 
noncompliance cannot be corrected by informal means, compliance with 
this regulation may be effected by the suspension or termination of or 
refusal to grant or to continue Federal financial assistance or by any 
other means authorized by law. Such other means may include, but are not 
limited to, (1) a reference to the Department of Justice with a 
recommendation that appropriate proceedings be brought to enforce any 
rights of the United States under any law of the United States 
(including other titles of the Act), or any assurance or other 
contractual undertaking, and (2) any applicable proceeding under state 
or local law.
    (b) Noncompliance with section 7. If an applicant fails or refuses 
to furnish an assurance required under section 7 or otherwise fails or 
refuses to comply with a requirement imposed by or pursuant to that 
section Federal financial assistance may be refused in accordance with 
the procedures of paragraph (c) of this section. The agency shall not be 
required to provide assistance in such a case during the pendency of the 
administrative proceedings under such paragraph except that the agency 
shall continue assistance during the pendency of such proceedings where 
such assistance is due and payable pursuant to an application thereof 
approved prior to the effective date of this regulation.

[[Page 70]]

    (c) Termination of or refusal to grant or to continue Federal 
financial assistance. No order suspending, terminating or refusing to 
grant or continue Federal financial assistance shall become effective 
until (1) the responsible agency official has advised the applicant or 
recipient of his failure to comply and has determined that compliance 
cannot be secured by voluntary means, (2) there has been an express 
finding on the record, after opportunity for hearing, of a failure by 
the applicant or recipient to comply with a requirement imposed by or 
pursuant to this regulation, (3) the action has been approved by the 
Director of the Federal Emergency Management Agency pursuant to section 
14, and (4) the expiration of 30 days after the Director has filed with 
the committee of the House and the committee of the Senate having 
legislative jurisdiction over the program involved, a full written 
report of the circumstances and the grounds for such action. Any action 
to suspend or terminate or to refuse to grant or to continue Federal 
financial assistance shall be limited to the particular political 
entity, or part thereof, or other applicant or recipient as to whom such 
a finding has been made and shall be limited in its effect to the 
particular program, or part thereof, in which such noncompliance has 
been so found.
    (d) Other means authorized by law. No action to effect compliance by 
any other means authorized by law shall be taken until (1) the 
responsible agency official has determined that compliance cannot be 
secured by voluntary means, (2) the action has been approved by the 
Director of the Federal Emergency Management Agency, (3) the recipient 
or other person has been notified of its failure to comply and of the 
action to be taken to effect compliance, and (4) the expiration of at 
least 10 days from the mailing of such notice to the recipient or other 
person. During this period of at least 10 days additional efforts shall 
be made to persuade the recipient or other person to comply with the 
regulation and to take such corrective action as may be appropriate.



Sec. 7.13  Hearings.

    (a) Opportunity for hearing. Whenever an opportunity for a hearing 
is required by section 12(c), reasonable notice shall be given by 
registered or certified mail, return receipt requested, to the affected 
applicant or recipient. This notice shall advise the applicant or 
recipient of the action proposed to be taken, the specific provision 
under which the proposed action against it is to be taken, and the 
matters of fact or law asserted as the basis for this action, and either 
(1) fix a date not less than 20 days after the date of such notice 
within which the applicant or recipient may request of the responsible 
agency official that the matter be scheduled for hearing or (2) advise 
the applicant or recipient that the matter in question has been set down 
for hearing at a stated place and time. The time and place so fixed 
shall be reasonable and shall be subject to change for cause. The 
complainant, if any, shall be advised of the time and place of the 
hearing. An applicant or recipient may waive a hearing and submit 
written information and argument for the record. The failure of an 
applicant or recipient to request a hearing under this subsection or to 
appear at a hearing for which a date has been set shall be deemed to be 
a waiver of the right to a hearing under section 602 of the Act and 
section 12(c) of this regulation and consent to the making of a decision 
on the basis of such information as is available.
    (b) Time and place of hearing. Hearings shall be held at the 
National Headquarters of the Federal Emergency Management Agency in 
Washington, DC, at a time fixed by the responsible agency official 
unless he determines that the convenience of the applicant or recipient 
or of the agency requires that another place be selected. Hearings shall 
be held before the responsible agency official or, at his discretion, 
before a hearing examiner designated in accordance with section 11 of 
the Administrative Procedure Act.
    (c) Right to counsel. In all proceedings under this section, the 
applicant or recipient and the agency shall have the right to be 
represented by counsel.

[[Page 71]]

    (d) Procedures, evidence, and record. (1) The hearing, decision, and 
any administrative review thereof shall be conducted in conformity with 
sections 5-8 of the Administrative Procedure Act, and in accordance with 
such rules of procedure as are proper (and not inconsistent with this 
section) relating to the conduct of the hearing, giving of notices 
subsequent to those provided for in paragraph (a) of this section, 
taking of testimony, exhibits, arguments and briefs, requests for 
findings, and other related matters. Both the agency and the applicant 
or recipient shall be entitled to introduce all relevant evidence on the 
issues as stated in the notice for hearing or as determined by the 
officer conducting the hearing at the outset of or during the hearing.
    (2) Technical rules of evidence shall not apply to hearings 
conducted pursuant to this regulation, but rules or principles designed 
to assure production of the most credible evidence available and to 
subject testimony to test by cross-examination shall be applied where 
reasonably necessary by the officer conducting the hearing. The hearing 
officer may exclude irrelevant, immaterial, or unduly repetitious 
evidence. All documents and other evidence offered or taken for the 
record shall be open to examination by the parties and opportunity shall 
be given to refute facts and arguments advanced on either side of the 
issues. A transcript shall be made of the oral evidence except to the 
extent the substance thereof is stipulated for the record. All decisions 
shall be based upon the hearing record and written findings shall be 
made.
    (e) Consolidated or joint hearings. In cases in which the same or 
related facts are asserted to constitute noncompliance with this 
regulation with respect to two or more programs to which this regulation 
applies, or noncompliance with this regulation and the regulations of 
one or more other Federal departments or agencies issued under title VI 
of the Act, the Director of the Federal Emergency Management Agency may, 
by agreement with such other departments or agencies where applicable, 
provide for the conduct of consolidated or joint hearings, and for the 
application to such hearings of rules of procedures not inconsistent 
with this regulation. Final decisions in such cases, insofar as this 
regulation is concerned, shall be made in accordance with section 14.



Sec. 7.14  Decisions and notices.

    (a) Decision by person other than the responsible agency official. 
If the hearing is held by a hearing examiner such hearing examiner shall 
either make an initial decision, if so authorized, or certify the entire 
record including his recommended findings and proposed decision to the 
responsible agency official for a final decision, and a copy of such 
initial decision or certification shall be mailed to the applicant or 
recipient. Where the initial decision is made by the hearing examiner 
the applicant or recipient may within 30 days of the mailing of such 
notice of initial decision file with the responsible agency official his 
exceptions to the initial decision, with his reasons therefor. In the 
absence of exceptions, the responsible agency official may on his own 
motion within 45 days after the initial decision serve on the applicant 
or recipient a notice that he will review the decision. Upon the filing 
of such exceptions or of such notice of review the responsible agency 
official shall review the initial decision and issue his own decision 
thereon including the reasons therefor. In the absence of either 
exceptions or a notice of review the initial decision shall constitute 
the final decision of the responsible agency official.
    (b) Decisions on record or review by the responsible agency 
official. Whenever a record is certified to the responsible agency 
official for decision or he reviews the decision of a hearing examiner 
pursuant to paragraph (a) of this section, or whenever he conducts the 
hearing, the applicant or recipient shall be given reasonable 
opportunity to file with him briefs or other written statements of its 
contentions, and a copy of his final decision shall be given in writing 
to the applicant or recipient and to the complainant, if any.
    (c) Decisions on record where a hearing is waived. Whenever a 
hearing is waived pursuant to section 13(a) a decision

[[Page 72]]

shall be made by the responsible agency official on the record and a 
copy of such decision shall be given in writing to the applicant or 
recipient, and to the complainant, if any.
    (d) Rulings required. Each decision of a hearing officer or 
responsible agency official shall set forth his ruling on each finding, 
conclusion, or exception presented, and shall identify the requirement 
or requirements imposed by or pursuant to this regulation with which it 
is found that the applicant or recipient has failed to comply.
    (e) Approval by Director. Any final decision of a responsible agency 
official (other than the Director of the agency) which provides for the 
suspension or termination of, or the refusal to grant or continue 
Federal financial assistance, or the imposition of any other sanction 
available under this regulation or the Act, shall promptly be 
transmitted to the Director of the Federal Emergency Management Agency 
who may approve such decision, may vacate it, or remit or mitigate any 
sanction imposed.
    (f) Content of orders. The final decision may provide for suspension 
or termination of, or refusal to grant or continue Federal financial 
assistance, in whole or in part, under the program involved, and may 
contain such terms, conditions, and other provisions as are consistent 
with and will effectuate the purposes of the Act and this regulation, 
including provisions designed to assure that no Federal financial 
assistance will thereafter be extended under such program to the 
applicant or recipient determined by such decision to be in default in 
its performance of an assurance given by it pursuant to this regulation, 
or to have otherwise failed to comply with this regulation, unless and 
until it corrects its noncompliance and satisfies the Director of the 
Federal Emergency Management Agency that it will fully comply with this 
regulation.



Sec. 7.15  Judicial review.

    Action taken pursuant to section 602 of the Act is subject to 
judicial review as provided in section 603 of the Act.



Sec. 7.16  Effect on other regulations; forms and instructions.

    (a) Effect on other regulations. All regulations, orders, or like 
directions heretofore issued by any officer of the Federal Emergency 
Management Agency which impose requirements designed to prohibit any 
discrimination against individuals on the ground of race, color, or 
national origin under any program to which this regulation applies, and 
which authorize the suspension or termination of or refusal to grant or 
to continue Federal financial assistance to any applicant for or 
recipient of such assistance under such program for failure to comply 
with such requirements, are hereby superseded to the extent that such 
discrimination is prohibited by this regulation, except that nothing in 
this regulation shall be deemed to relieve any person of any obligation 
assumed or imposed under any such superseded regulation, order, 
instruction, or like direction prior to the effective date of this 
regulation. Nothing in this regulation, however, shall be deemed to 
supersede Executive Orders 10925 and 11114 (including future amendments 
thereof) and regulations issued thereunder, or any other regulations or 
instructions, insofar as such regulations or instructions prohibit 
discrimination on the ground of race, color, or national origin in any 
program or situation to which this regulation is inapplicable, or 
prohibit discrimination on any other ground.
    (b) Forms and instructions. Each responsible agency official shall 
issue and promptly make available to interested persons forms and 
detailed instructions and procedures for effectuating this regulation as 
applied to programs to which this regulation applies and for which he is 
responsible.
    (c) Supervision and coordination. The Director of the Federal 
Emergency Management Agency may from time to time assign to officials of 
other departments or agencies of the Government with the consent of such 
departments or agencies, responsibilities in connection with the 
effectuation of the purposes of title VI of the Act and this regulation 
(other than responsibility for final decision as provided in section

[[Page 73]]

14), including the achievement of effective coordination and maximum 
uniformity within the agency and within the Executive Branch of the 
Government in the application of title VI and this regulation to similar 
programs and in similar situations.



                         Subparts B-D [Reserved]



    Subpart E--Nondiscrimination on the Basis of Age in FEMA Program 
            Activities Receiving Federal Financial Assistance

    Authority: Age Discrimination Act of 1975, as amended, 42 U.S.C. 
26101 et seq. (45 CFR part 90).

    Source: 55 FR 23078, June 6, 1990, unless otherwise noted.

                                 General



Sec. 7.910  What is the purpose of the Age Discrimination Act of 1975?

    The Age Discrimination Act of 1975 (the ``Act''), as amended, is 
designed to prohibit discrimination on the basis of age in programs or 
activities receiving Federal financial assistance. The Act also permits 
federally-assisted programs and activities, and recipients of Federal 
funds, to continue to use certain age distinctions and factors other 
than age which meet the requirements of the Act and this regulation.



Sec. 7.911  What is the purpose of FEMA's age discrimination regulation?

    The purpose of this regulation is to set out FEMA's policies and 
procedures under the Age Discrimination Act of 1975 and the general 
governmentwide regulations, 45 CFR part 90. The Act and the general 
regulations prohibit discrimination on the basis of age in programs or 
activities receiving Federal financial assistance. The Act and the 
general regulations permit federally-assisted programs, activities, and 
recipients of Federal funds, to continue to use age distinctions and 
factors other than age which meet the requirements of the Act and its 
implementing regulations.



Sec. 7.912  To what programs does this regulation apply?

    (a) The Act and this regulation apply to each FEMA recipient and to 
each program or activity operated by the recipient which receives or 
benefits from Federal financial assistance provided by FEMA.
    (b) The Act and this regulation do not apply to:
    (1) An age distinction contained in that part of a Federal, State or 
local statute or ordinance adopted by an elected, general purpose 
legislative body which:
    (i) Provides any benefits or assistance to persons based on age; or
    (ii) Establishes criteria for participation in age-related terms; or
    (iii) Describes intended beneficiaries or target groups in age-
related terms.
    (2) Any employment practice of any employer, employment agency, 
labor organization, or any labor-management joint apprenticeship 
training program, except for any program or activity receiving Federal 
financial assistance for public service employment under the Job 
Training Partnership Act (29 U.S.C. 150, et seq.)



Sec. 7.913  Definition of terms used in this regulation.

    As used in this regulation, the term Act means the Age 
Discrimination Act of 1975 as amended (title III of Pub. L. 94-135).
    Action means any act, activity, policy, rule, standard, or method of 
administration; or the use of any policy, rule, standard or method of 
administration.
    Age means how old a person is, or the number of years from the date 
of a person's birth.
    Age distinction means any action using age or an age-related term.
    Age-related term means a word or words which necessarily imply a 
particular age or range of ages (for example, children, older persons, 
but not student).
    Agency means the Federal Emergency Management Agency.
    Director means the Director of the Federal Emergency Management 
Agency.
    Federal financial assistance means any grant, entitlement, loan, 
cooperative

[[Page 74]]

agreement, contract (other than a procurement contract or a contract of 
insurance or guaranty), or any other arrangement by which the agency 
provides or otherwise makes available assistance in the form of:
    (a) Funds; or
    (b) Services or Federal personnel; or
    (c) Real and personal property or any interest in or use of 
property, including:
    (1) Transfers or leases of property for less than fair market value 
or for reduced consideration; and
    (2) Proceeds from a subsequent transfer or lease of property if the 
Federal share of its fair market value is not returned to the Federal 
Government.
    Normal operation means the operation of a program or activity 
without significant changes that would impair its ability to meet its 
objective.
    Recipient means any State or its political subdivision, any 
instrumentality of a State or its political subdivision, institution, 
organization, or other entity, or any person to which Federal financial 
assistance is extended, directly or through another recipient. Recipient 
includes any successor, assignee, or transferee, but excludes the 
ultimate beneficiary of the assistance.
    Statutory objective means any purpose of a program or activity 
expressly stated in any Federal statute, State statute or local statute 
or ordinance adopted by an elected, general purpose legislative body.
    Subrecipient means any of the entities in the definition of 
``recipient'' to which a recipient extends or passes on Federal 
financial assistance. A subrecipient is generally regarded as a 
recipient of Federal financial assistance and has all the duties of a 
recipient in these regulations.
    United States includes the States of the United States, the District 
of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, 
American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, 
Wake Island, the Canal Zone, the Trust Territory of the Pacific Islands 
and all other territories and possessions of the United States. The term 
``State'' also includes any one of the foregoing.

              Standards for Determining Age Discrimination



Sec. 7.920  Rules against discrimination.

    The rules stated in this section are limited by the exceptions 
contained in Secs. 7.921 and 7.922 of these regulations.
    (a) General rule: No person in the United States shall, on the basis 
of age, be excluded from participation in, be denied the benefits of, or 
be subjected to discrimination under, any program or activity receiving 
Federal financial assistance.
    (b) Specific rules: A recipient may not, in any program or activity 
receiving Federal financial assistance, directly or through contractual 
licensing, or other arrangements, use age distinctions or take any other 
actions which have the effect, on the basis of age, of:
    (1) Excluding individuals from, denying them the benefits of, 
subjecting them to discrimination under, a program or activity receiving 
Federal financial assistance; or
    (2) Denying or limiting individuals in their opportunity to 
participate in any program or activity receiving Federal financial 
assistance. The specific forms of age discrimination listed in paragraph 
(b) of this section do not necessarily constitute a complete list.



Sec. 7.921  Exceptions to the rules against age discrimination: Normal operation or statutory objective of any program or activity.

    A recipient is permitted to take an action, otherwise prohibited by 
Sec. 7.920, if the action reasonably takes into account age as a factor 
necessary to the normal operation of the achievement of any statutory 
objective of a program or activity. An action reasonably takes into 
account age as a factor necessary to the normal operation or the 
achievement of any statutory objective of a program or activity, if:
    (a) Age is used as a measure or approximation of one or more other 
characteristics; and
    (b) The other characteristic(s) must be measured or approximated in 
order for the normal operation of the program or activity to continue, 
or to achieve any statutory objective of the program or activity; and

[[Page 75]]

    (c) The other characteristic(s) can be reasonably measured or 
approximated by the use of age; and
    (d) The other characteristic(s) are impractical to measure directly 
on an individual basis.



Sec. 7.922  Exceptions to the rules against age discrimination: Reasonable factors other than age.

    A recipient is permitted to take an action otherwise prohibited by 
Sec. 7.920 which is based on a factor other than age, even though that 
action may have a disproportionate effect on persons of different ages 
only if the factor bears a direct and substantial relationship to the 
normal operation of the program or activity or to the achievement of a 
statutory objective.



Sec. 7.923  Burden of proof for exceptions.

    The burden of proving that an age distinction or other action falls 
within the exceptions outlined in Secs. 7.921 and 7.922 is on the 
recipient of Federal financial assistance.



Sec. 7.924  Affirmative action by recipient.

    Even in the absence of a finding of discrimination, a recipient may 
take affirmative action to overcome the effects of conditions that 
resulted in the limited participation in the recipient's program or 
activity on the basis of age.



Sec. 7.925  Special benefits for children and the elderly.

    If a recipient operating a program provides special benefits to the 
elderly or to children, such use of age distinctions shall be presumed 
to be necessary to the normal operation of the program, notwithstanding 
the provisions of Sec. 7.921.



Sec. 7.926  Age distinctions contained in FEMA regulations.

    Any age distinctions contained in a rule or regulation issued by 
FEMA shall be presumed to be necessary to the achievement of a statutory 
objective of the program to which the rule or regulation applies, 
notwithstanding the provisions of Sec. 7.921.

                        Duties of FEMA Recipients



Sec. 7.930  General responsibilities.

    Each FEMA recipient has primary responsibility to ensure that its 
programs and activities are in compliance with the Act and this 
regulation, and shall take steps to eliminate violations of the Act. A 
recipient also has responsibility to maintain records, provide 
information, and to afford FEMA access to its records to the extent FEMA 
finds necessary to determine whether the recipient is in compliance with 
the Act and this regulation.



Sec. 7.931  Notice to subrecipients and beneficiaries.

    (a) Where a recipient passes on Federal financial assistance from 
FEMA to subrecipients, the recipient shall provide the subrecipients 
written notice of their obligations under the Act and this regulation.
    (b) Each recipient shall make necessary information about the Act 
and this regulation available to its program beneficiaries in order to 
inform them about the protection against discrimination provided by the 
Act and this regulation.



Sec. 7.932  Assurance of compliance and recipient assessment of age distinctions.

    (a) Each recipient of Federal financial assistance from FEMA shall 
sign a written assurance as specified by FEMA that it will comply with 
Act and this regulation.
    (b) Recipient assessment of age distinctions. (1) As part of the 
compliance review under Sec. 7.940 or complaint investigation under 
Sec. 7.943, FEMA may require a recipient employing the equivalent of 
fifteen or more employees to complete written evaluation, in a manner 
specified by the responsible Agency official, of any age distinction 
imposed in its program or activity receiving Federal financial 
assistance from FEMA to assess the recipient's compliance with the Act.
    (2) Whenever an assessment indicates a violation of the Act and the 
FEMA regulations, the recipient shall take corrective action.

[[Page 76]]



Sec. 7.933  Information requirement.

    Each recipient shall:
    (a) Keep records in a form acceptable to FEMA and containing 
information which FEMA determines are necessary to ascertain whether the 
recipient is complying with the Act and this regulation.
    (b) Provide to FEMA, upon request, information and reports which 
FEMA determines are necessary to ascertain whether the recipient is 
complying with the Act and this regulation.
    (c) Permit FEMA reasonable access to the books, records, accounts, 
and other recipient facilities and sources of information to the extent 
FEMA determines is necessary to ascertain whether the recipient is 
complying with the Act and this regulation.

         Investigation, Conciliation, and Enforcement Procedures



Sec. 7.940  Compliance reviews.

    (a) FEMA may conduct compliance reviews and preaward reviews or use 
other similar procedures that will permit it to investigate and correct 
violations of the Act and this regulation. FEMA may conduct these 
reviews even in the absence of a complaint against a recipient. The 
reviews may be as comprehensive as necessary to determine whether a 
violation of the Act and this regulation has occurred.
    (b) If a compliance review or preaward review indicates a violation 
of the Act or this regulation, FEMA will attempt to achieve voluntary 
compliance with the Act. If voluntary compliance cannot be achieved, 
FEMA will arrange for enforcement as described in Sec. 7.945.



Sec. 7.941  Complaints.

    (a) Any person, individually or as a member of a class or on behalf 
of others, may file a complaint with FEMA, alleging discrimination 
prohibited by the Act or these regulations occurring after the date of 
final adoption of this rule. A complainant shall file a complaint within 
180 days from the date the complainant first had knowledge of the 
alleged act of discrimination. However, for good cause showing, FEMA may 
extend this time limit.
    (b) FEMA will consider the date a complaint is filed to be the date 
upon which the complaint is sufficient to be processed. A complaint is 
deemed ``sufficient'' when it contains particulars (e.g., names, 
addresses, and telephone numbers of parties involved; date(s) of alleged 
discrimination; kind(s) of alleged discrimination) upon which to begin 
an investigation.
    (c) FEMA will attempt to facilitate the filing of complaints 
wherever possible, including taking the following measures:
    (1) Accepting as a sufficient complaint any written statement which 
identifies the parties involved and the date the complainant first had 
knowledge of the alleged violation, describes generally the action or 
practice complained of, and is signed by the complainant.
    (2) Freely permitting a complainant to add information to the 
complaint to meet the requirements of a sufficient complaint.
    (3) Notifying the complainant and the recipient of their rights and 
obligations under the complaint procedure, including the right to have a 
representative at all stages of the complaint procedure.
    (4) Notifying the complainant and the recipient (or their 
representatives) of their right to contact FEMA for information and 
assistance regarding the complaint resolution process.
    (d) FEMA will return to the complainant any complaint outside the 
jurisdiction of this regulation, and will state the reason(s) why it is 
outside the jurisdiction of this regulation.



Sec. 7.942  Mediation.

    (a) FEMA will promptly refer to a mediation agency designated by the 
Director all sufficient complaints that:
    (1) Fall within the jurisdiction of the Act and this regulation, 
unless the age distinction complained of is clearly within an exception; 
and,
    (2) Contain all information necessary for further processing.
    (b) Both the complainant and the recipient shall participate in the 
mediation process to the extent necessary to reach an agreement or for 
the mediator to make an informed judgment that an agreement is not 
possible.

[[Page 77]]

    (c) If the complainant and the recipient reach an agreement, the 
mediator shall prepare a written statement of the agreement and have the 
complainant and the recipient sign it. The mediator shall send a copy of 
the agreement to FEMA. FEMA will take no further action on the complaint 
unless the complainant or the recipient fails to comply with the 
agreement.
    (d) The mediator shall protect the confidentiality of all 
information obtained in the course of the mediation process. No mediator 
shall testify in any adjudicative proceeding, produce any document, or 
otherwise disclose any information obtained in the course of the 
mediation process without prior approval of the head of the mediation 
agency.
    (e) The mediation will proceed for a maximum of 60 days after a 
complaint is filed with FEMA. Mediation ends if:
    (1) Sixty days elapse from the time the complaint is filed; or
    (2) Prior to the end of that 60 day period, an agreement is reached; 
or
    (3) Prior to the end of that 60 day period, the mediator determines 
that an agreement cannot be reached. This 60 day period may be extended 
by the mediator, with the concurrence of FEMA, for not more than 30 days 
if the mediator determines agreement will likely be reached during such 
extended period.
    (f) The mediator shall return unresolved complaints to FEMA.



Sec. 7.943  Investigation.

    (a) Informal investigation. (1) FEMA will investigate complaints 
that are unresolved after mediation or are reopened because of a 
violation of a mediation agreement.
    (2) As part of the initial investigation, FEMA will use informal 
fact finding methods, including joint or separate discussion with the 
complainant and recipient, to establish the facts and, if possible, 
settle the complaint on terms that are mutually agreeable to the 
parties. FEMA may seek the assistance of any involved state program 
agency.
    (3) FEMA will put any agreement in writing and have it signed by the 
parties and an authorized official at FEMA.
    (4) The settlement shall not affect the operation of any other 
enforcement effort of FEMA, including compliance reviews and 
investigation of other complaints which may involve the recipient.
    (5) The settlement is not a finding of discrimination against a 
recipient.
    (b) Formal investigation. If FEMA cannot resolve the complaint 
through informal investigation, it will begin to develop formal findings 
through further investigation of the complaint. If the investigation 
indicates a violation of this regulation, FEMA will attempt to obtain 
voluntary compliance, it will begin enforcement as described in 
Sec. 7.945.



Sec. 7.944  Prohibition against intimidation or retaliation.

    A recipient may not engage in acts of intimidation or retaliation 
against any person who:
    (a) Attempts to assert a right protected by the Act or this 
regulation; or
    (b) Cooperates in any mediation, investigation, hearing, or other 
part of FEMA's investigation, conciliation and enforcement process.



Sec. 7.945  Compliance procedure.

    (a) FEMA may enforce the Act and this regulation through:
    (1) Termination of a recipient's Federal financial assistance from 
FEMA under the program or activity involved where the recipient has 
violated the Act or this regulation. The determination of the 
recipient's violation may be made only after a recipient has had an 
opportunity for a hearing on the record before an administrative law 
judge.
    (2) Any other means authorized by law including but not limited to:
    (i) Referral to the Department of Justice for proceedings to enforce 
any rights of the United States or obligations of the recipient created 
by the Act or this regulation.
    (ii) Use of any requirement of or referral to any Federal, State or 
local government agency that will have the effect of correcting a 
violation of the Act or this regulation.

[[Page 78]]

    (b) FEMA will limit any termination under Sec. 7.945(a)(1) to the 
particular recipient and particular program or activity or part of such 
program and activity FEMA finds in violation of this regulation. FEMA 
will not base any part of a termination on a finding with respect to any 
program or activity of the recipient which does not receive Federal 
financial assistance from FEMA.
    (c) FEMA will take no action under paragraph (a) until:
    (1) The Director has advised the recipient of its failure to comply 
with the Act and this regulation and has determined that voluntary 
compliance cannot be obtained.
    (2) Thirty days have elapsed after the Director has sent a written 
report of the circumstances and grounds of the action to the committees 
of the Congress having legislative jurisdiction over the Federal program 
or activity involved. The Director will file a report whenever any 
action is taken under paragraph (a).
    (d) FEMA also may defer granting new Federal financial assistance 
from FEMA to a recipient when a hearing under Sec. 7.945(a)(1) is 
initiated.
    (1) New Federal financial assistance from FEMA includes all 
assistance for which FEMA requires an application or approval, including 
renewal or continuation of existing activities, or authorization of new 
activities, during the deferral period. New Federal financial assistance 
from FEMA does not include increases in funding as a result of changed 
computation of formula awards or assistance approved prior to the 
beginning of a hearing under Sec. 7.945(a)(1).
    (2) FEMA will not begin a deferral until the recipient has received 
a notice of an opportunity for a hearing under Sec. 7.945(a)(1). FEMA 
will not continue a deferral for more than 60 days unless a hearing has 
begun within that time or the time for beginning the hearing has been 
extended by mutual consent of the recipient for more than 30 days after 
the close of the hearing, unless the hearing results in a finding 
against the recipient.
    (3) FEMA will limit any deferral to the particular recipient and 
particular program or activity or part of such program or activity FEMA 
finds in violation of this regulation. FEMA will not base any part of a 
deferral on a finding with respect to any program or activity of the 
recipient which does not and would not, in connection with new funds, 
receive Federal financial assistance from FEMA.



Sec. 7.946  Hearings, decisions, post-termination proceedings.

    Certain FEMA procedural provisions applicable to title VI of the 
Civil Rights Act of 1964 apply to FEMA enforcement of this regulation. 
They are found at 44 CFR 7.10 through 7.16.



Sec. 7.947  Remedial action by recipient.

    Where FEMA finds a recipient has discriminated on the basis of age, 
the recipient shall take any remedial action that FEMA may require to 
overcome the effects of the discrimination. If another recipient 
exercises control over the recipient that had discriminated, FEMA may 
require both recipients to take remedial action.



Sec. 7.948  Alternate funds disbursal procedure.

    (a) When FEMA withholds funds from recipient under this regulation, 
the Director may, if allowable under the statute governing the 
assistance, disburse the withheld funds directly to an alternate 
recipient: Any public or nonprofit private organization or agency, or 
State or political subdivision of the State.
    (b) The Director will require any alternate recipient to 
demonstrate:
    (1) The ability to comply with this regulation; and
    (2) The ability to achieve the goals of the Federal statute 
authorizing the program or activity.



Sec. 7.949  Exhaustion of administrative remedies.

    (a) A complainant may file a civil action following the exhaustion 
of administrative remedies under the Act. Administrative remedies are 
exhausted if:
    (1) 180 days have elapsed since the complainant filed the complaint 
and FEMA had made no finding with regard to the complaint; or
    (2) FEMA issues any finding in favor of the recipient.

[[Page 79]]

    (b) If FEMA fails to make a finding within 180 days or issues a 
finding in favor of the recipient, FEMA shall:
    (1) Promptly advise the complainant in writing of this fact; and
    (2) Advise the complainant of his or her right to bring a civil 
action for injunctive relief; and
    (3) Inform the complainant:
    (i) That the complainant may bring a civil action only in a United 
States District Court for the district in which the recipient is located 
or transacts business;
    (ii) That a complainant prevailing in a civil action has the right 
to be awarded the costs of the action, including reasonable attorney's 
fees, but that the complainant must demand these costs in the complaint 
at the time it is filed.
    (iii) That before commencing the action, the complainant shall give 
30 days notice by registered mail to the Director, the Attorney General 
of the United States, and the recipient;
    (iv) That the notice must state: The alleged violation of the Act; 
the relief requested; the court in which the complainant is bringing the 
action; and whether or not attorney's fees are demanded in the event the 
complainant prevails; and
    (v) That the complainant may not bring an action if the same alleged 
violation of the Act by the same recipient is the subject of a pending 
action in any court (Federal or State) of the United States.



PART 8--NATIONAL SECURITY INFORMATION--Table of Contents




Sec.
8.1  Purpose.
8.2  Original classification authority.
8.3  Senior FEMA official responsible for the information security 
          program.
8.4  Mandatory declassification review procedures.

    Authority: Reorganization Plan No. 3 of 1978, E.O. 12148 and E.O. 
12356.



Sec. 8.1  Purpose.

    (a) Section 5.3(b) of Executive Order (EO) 12356, ``National 
Security Information'' requires agencies to promulgate implementing 
policies and regulations. To the extent that these regulations affect 
members of the public, these policies are to be published in the Federal 
Register.
    (b) This regulation provides public notification of the FEMA 
procedures for processing requests for the mandatory review of 
classified information pursuant to section 3.4(d) of E.O. 12356.

[49 FR 24518, June 14, 1984, as amended at 49 FR 38119, Sept. 27, 1984; 
50 FR 40006, Oct. 1, 1985]



Sec. 8.2  Original classification authority.

    (a) The Director, Federal Emergency Management Agency (FEMA), has 
the authority to classify information originally as TOP SECRET, as 
designated by the President in the Federal Register, Vol 47, No. 91, May 
11, 1982, in accordance with section 1.2(a)(2), E.O. 12356.
    (b) In accordance with section 1.2(d)(2), E.O. 12356, the following 
positions have been delegated ORIGINAL TOP SECRET CLASSIFICATION 
AUTHORITY by the Director, FEMA:
    (1) DEPUTY DIRECTOR, FEMA
    (2) ASSOCIATE DIRECTOR, NATIONAL PREPAREDNESS DIRECTORATE
    (3) DIRECTOR, OFFICE OF SECURITY
    (c) The positions delegated original Top Secret Classification 
Authority in paragraph (b) of this section, are also delegated Original 
Secret and Confidential Classification Authority by virtue of this 
delegation. The following positions have been delegated Original Secret 
and Original Confidential Classification Authority:
    (1) Associate Director, State and Local Programs and Support.
    (2) Regional Directors.

Any further delegation of original classification authority, for any 
classification level, will be accomplished only by the Director of the 
Federal Emergency Management Agency.
    (d) The positions delegated ORIGINAL TOP SECRET CLASSIFICATION 
AUTHORITY in paragraph (b) of this section, are also delegated ORIGINAL 
SECRET and CONFIDENTIAL CLASSIFICATION AUTHORITY by virtue of this 
delegation. The positions delegated ORIGINAL SECRET CLASSIFICATION 
AUTHORITY in paragraph (c) of this section, are also delegated

[[Page 80]]

ORIGINAL CONFIDENTIAL CLASSIFICATION AUTHORITY by virtue of this 
delegation. Any further delegation of original classification authority, 
for any classification level, will be accomplished only by the Director 
of FEMA.

[49 FR 24518, June 14, 1984 as amended at 51 FR 34605, Sept. 30, 1986; 
53 FR 47210, Nov. 22, 1989; 56 FR 32328, July 16, 1991]



Sec. 8.3  Senior FEMA official responsible for the information security program.

    The Director of Security, FEMA, has been designated as the senior 
official to direct and administer the FEMA information security program, 
in accordance with section 5.3(a), E.O. 12356.

[49 FR 24518, June 14, 1984]



Sec. 8.4  Mandatory declassification review procedures.

    (a) All information classified by FEMA under E.O. 12356 or 
predecessor orders shall be subject to a review for declassification if 
such a review is requested by a United States citizen or permanent 
resident alien, a Federal agency or a State or local government.
    (b) Requests for declassification review shall be submitted to the 
Office of Security, Federal Emergency Management Agency, Washington, DC 
20472. All requests shall be in writing and reasonably describe the 
information sought with sufficient clarity to enable the appropriate 
FEMA component to identify the information sought. Any requests that do 
not sufficiently identify the information sought shall be returned to 
the requestor and he or she shall be asked to clarify the request and/or 
provide additional information.
    (c) If within 30 days the requestor does not respond to the agency's 
request for clarification or additional information, the FEMA Office of 
Security shall notify the requestor that no further action can be taken 
on the request. If the requestor's response to the agency's request for 
clarification and/or additional information is inadequate, the Office of 
Security shall notify him or her that no further action will be taken 
until such time as the agency is provided with adequate information 
concerning the request. In addition, the agency's response will set 
forth the agency's explanation of the deficiencies of the request.
    (d) Once a request meets the foregoing requirements for processing, 
it will be acted upon as follows:
    (1) Receipt of all requests shall be acknowledged within ten (10) 
working days.
    (2) FEMA action upon a request shall be completed within sixty (60) 
calendar days.
    (e) The Director of Security shall designate a FEMA component to 
conduct the declassification review. This will normally be the 
originating component. The designated program or staff office shall 
conduct the review and forward its recommendation(s) to the Office of 
Security. Information no longer requiring protection under E.O. 12356 
shall be declassified and released unless withholding is otherwise 
authorized under applicable law. When information cannot be declassified 
in its entirety, FEMA will make a reasonable effort to release those 
declassified portions of the requested information that constitute a 
coherent segment. If the information may not be released in whole or 
part, the requestor shall be given a brief statement as to the reason 
for the denial, a notice of the right to appeal the determination to the 
Director of FEMA and a notice that such an appeal must be filed within 
sixty (60) calendar days to be considered.
    (f) If the request requires the rendering of services for which fees 
may be charged under 31 U.S.C. 9701, such fees may be imposed in 
accordance with the provisions of 44 CFR part 5, subpart C.
    (g) The following procedures shall be followed when denials of 
requests for declassification are appealed:
    (1) The Director shall, within fifteen (15) working days of receipt 
of the appeal, convene a meeting of the FEMA Information Security 
Oversight Committee (ISOC). Representation on the FEMA ISOC shall 
include the Director of Security or his/her representative, a 
representative of the component that denied the original request, a 
representative from the Office of General Counsel, a representative from 
the Office of External Affairs and the Chief of Staff or his/her 
representative.

[[Page 81]]

    (2) If the ISOC upholds the appeal in its entirety, the information 
will be released in accordance with the provisions of paragraph (e) of 
this section.
    (3) If the ISOC denies the appeal, in part or in its entirety, then 
it will forward the appeal with its recommendation(s) to the Director of 
FEMA, for a final determination. A reply will be forwarded to the 
requestor enclosing the declassified releasable information if any, and 
an explanation for denying the request in whole or in part.
    (4) Final action on appeals shall be completed within thirty (30) 
working days of receipt of appeal.

[49 FR 24518, June 14, 1984, as amended at 49 FR 38119, Sept. 27, 1984; 
50 FR 40006, Oct. 1, 1985; 51 FR 34605, Sept. 30, 1986]



PART 9--FLOODPLAIN MANAGEMENT AND PROTECTION OF WETLANDS--Table of Contents




Sec.
9.1  Purpose of part.
9.2  Policy.
9.3  Authority.
9.4  Definitions.
9.5  Scope.
9.6  Decision-making process.
9.7  Determination of proposed action's location.
9.8  Public notice requirements.
9.9  Analysis and reevaluation of practicable alternatives.
9.10  Identify impacts of proposed actions.
9.11  Mitigation.
9.12  Final public notice.
9.13  Particular types of temporary housing.
9.14  Disposal of Agency property.
9.15  Planning programs affecting land use.
9.16  Guidance for applicants.
9.17  Instructions to applicants.
9.18  Responsibilities.


Appendix A to Part 9--Decision-Making Process for E.O. 11988

    Authority: E.O. 11988; E.O. 11990; Reog. Plan No. 3 of 1978; E.O. 
12127; E.O. 12148; 42 U.S.C. 5201.

    Source: 45 FR 59526, Sept. 9, 1980, unless otherwise noted.



Sec. 9.1  Purpose of part.

    This regulation sets forth the policy, procedure and 
responsibilities to implement and enforce Executive Order 11988, 
Floodplain Management, and Executive Order 11990, Protection of 
Wetlands.



Sec. 9.2  Policy.

    (a) FEMA shall take no action unless and until the requirements of 
this regulation are complied with.
    (b) It is the policy of the Agency to provide leadership in 
floodplain management and the protection of wetlands. Further, the 
Agency shall integrate the goals of the Orders to the greatest possible 
degree into its procedures for implementing NEPA. The Agency shall take 
action to:
    (1) Avoid long- and short-term adverse impacts associated with the 
occupancy and modification of floodplains and the destruction and 
modification of wetlands;
    (2) Avoid direct and indirect support of floodplain development and 
new construction in wetlands wherever there is a practicable 
alternative;
    (3) Reduce the risk of flood loss;
    (4) Promote the use of nonstructural flood protection methods to 
reduce the risk of flood loss;
    (5) Minimize the impact of floods on human health, safety and 
welfare;
    (6) Minimize the destruction, loss or degradation of wetlands;
    (7) Restore and preserve the natural and beneficial values served by 
floodplains;
    (8) Preserve and enhance the natural values of wetlands;
    (9) Involve the public throughout the floodplain management and 
wetlands protection decision-making process;
    (10) Adhere to the objectives of the Unified National Program for 
Floodplain Management; and
    (11) Improve and coordinate the Agency's plans, programs, functions 
and resources so that the Nation may attain the widest range of 
beneficial uses of the environment without degradation or risk to health 
and safety.



Sec. 9.3  Authority.

    The authority for these regulations is (a) Executive Order 11988, 
May 24, 1977, which replaced Executive Order 11296, August 10, 1966, (b) 
Executive Order 11990, May 24, 1977, (c) Reorganization Plan No. 3 of 
1978 (43 FR 41943); and (d) Executive Order 12127, April 1, 1979 (44 FR 
1936). E.O. 11988 was issued in furtherance of the National Flood 
Insurance Act of 1968, as amended (Pub.

[[Page 82]]

L. 90-488); the Flood Disaster Protection Act of 1973, as amended (Pub. 
L. 93-234); and the National Environmental Policy Act of 1969 (NEPA) 
(Pub. L. 91-190). Section 2(d) of Executive Order 11988 requires 
issuance of new or amended regulations and procedures to satisfy its 
substantive and procedural provisions. E.O. 11990 was issued in 
furtherance of NEPA, and at section 6 required issuance of new or 
amended regulations and procedures to satisfy its substantive and 
procedural provisions.

[45 FR 59526, Sept. 9, 1980, as amended at 48 FR 44543, Sept. 29, 1983]



Sec. 9.4  Definitions.

    The following definitions shall apply throughout this regulation.
    Action means any action or activity including: (a) Acquiring, 
managing and disposing of Federal lands and facilities; (b) providing 
federally undertaken, financed or assisted construction and 
improvements; and (c) conducting Federal activities and programs 
affecting land use, including, but not limited to, water and related 
land resources, planning, regulating and licensing activities.
    Actions Affecting or Affected by Floodplains or Wetlands means 
actions which have the potential to result in the long- or short-term 
impacts associated with (a) the occupancy or modification of 
floodplains, and the direct or indirect support of floodplain 
development, or (b) the destruction and modification of wetlands and the 
direct or indirect support of new construction in wetlands.
    Agency means the Federal Emergency Management Agency (FEMA).
    Agency Assistance means grants for projects or planning activities, 
loans, and all other forms of financial or technical assistance provided 
by the Agency.
    Associate Director means the head of any Office or Administration of 
the Federal Emergency Management Agency, who has programmatic 
responsibility for a particular action.
    Base Flood means the flood which has a one percent chance of being 
equalled or exceeded in any given year (also known as a 100-year flood). 
This term is used in the National Flood Insurance Program (NFIP) to 
indicate the minimum level of flooding to be used by a community in its 
floodplain management regulations.
    Base Floodplain means the 100-year floodplain (one percent chance 
floodplain).
    Coastal High Hazard Area means the areas subject to high velocity 
waters including but not limited to hurricane wave wash or tsunamis. On 
a Flood Insurance Rate Map (FIRM), this appears as zone V1-30, VE or V.
    Critical Action means an action for which even a slight chance of 
flooding is too great. The minimum floodplain of concern for critical 
actions is the 500-year floodplain, i.e., critical action floodplain. 
Critical actions include, but are not limited to, those which create or 
extend the useful life of structures or facilities:
    (a) Such as those which produce, use or store highly volatile, 
flammable, explosive, toxic or water-reactive materials;
    (b) Such as hospitals and nursing homes, and housing for the 
elderly, which are likely to contain occupants who may not be 
sufficiently mobile to avoid the loss of life or injury during flood and 
storm events;
    (c) Such as emergency operation centers, or data storage centers 
which contain records or services that may become lost or inoperative 
during flood and storm events; and
    (d) Such as generating plants, and other principal points of utility 
lines.
    Direct Impacts means changes in floodplain or wetland values and 
functions and changes in the risk to lives and property caused or 
induced by an action or related activity. Impacts are caused whenever 
these natural values and functions are affected as a direct result of an 
action. An action which would result in the discharge of polluted storm 
waters into a floodplain or wetland, for example, would directly affect 
their natural values and functions. Construction-related activities, 
such as dredging and filling operations within the floodplain or a 
wetland would be another example of impacts caused by an action.
    Director means the Director of the Federal Emergency Management 
Agency (FEMA).

[[Page 83]]

    Emergency Actions means emergency work essential to save lives and 
protect property and public health and safety performed under sections 
305 and 306 of the Disaster Relief Act of 1974 (42 U.S.C. 5145 and 
5146). See 44 CFR part 205, subpart E.
    Enhance means to increase, heighten, or improve the natural and 
beneficial values associated with wetlands.
    Facility means any man-made or man-placed item other than a 
structure.
    FEMA means the Federal Emergency Management Agency.
    FIA means the Federal Insurance Administration.
    Five Hundred Year Floodplain (the 500-year floodplain or 0.2 percent 
change floodplain) means that area, including the base floodplain, which 
is subject to inundation from a flood having a 0.2 percent chance of 
being equalled or exceeded in any given year.
    Flood or flooding means a general and temporary condition of partial 
or complete inundation of normally dry land areas from the overflow of 
inland and/or tidal waters, and/or the unusual and rapid accumulation or 
runoff of surface waters from any source.
    Flood Fringe means that portion of the floodplain outside of the 
floodway (often referred to as ``floodway fringe'').
    Flood Hazard Boundary Map (FHBM) means an offical map of a 
community, issued by the Director, where the boundaries of the flood, 
mudslide (i.e., mudflow) and related erosion areas having special 
hazards have been designated as Zone A, M, or E.
    Flood Insurance Rate Map (FIRM) means an official map of a community 
on which the Director has delineated both the special hazard areas and 
the risk premium zones applicable to the community.
    Flood Insurance Study (FIS) means an examination, evaluation and 
determination of flood hazards and, if appropriate, corresponding water 
surface elevations or an examination, evaluation and determination of 
mudslide (i.e., mudflow) and/or flood-related erosion hazards.
    Floodplain means the lowland and relatively flat areas adjoining 
inland and coastal waters including, at a minimum, that area subject to 
a one percent or greater chance of flooding in any given year. Wherever 
in this regulation the term ``floodplain'' is used, if a critical action 
is involved, ``floodplain'' shall mean the area subject to inundation 
from a flood having a 0.2 percent chance of occurring in any given year 
(500-year floodplain). ``Floodplain'' does not include areas subject 
only to mudflow until FIA adopts maps identifying ``M'' Zones.
    Floodproofing means the modification of individual structures and 
facilities, their sites, and their contents to protect against 
structural failure, to keep water out, or to reduce effects of water 
entry.
    Floodway means that portion of the floodplain which is effective in 
carrying flow, within which this carrying capacity must be preserved and 
where the flood hazard is generally highest, i.e., where water depths 
and velocities are the greatest. It is that area which provides for the 
discharge of the base flood so the cumulative increase in water surface 
elevation is no more than one foot.
    Functionally Dependent Use means a use which cannot perform its 
intended purpose unless it is located or carried out in close proximity 
to water, (e.g., bridges, and piers).
    Indirect Impacts means an indirect result of an action whenever the 
action induces or makes possible related activities which effect the 
natural values and functions of floodplains or wetlands or the risk to 
lives and property. Such impacts occur whenever these values and 
functions are potentially affected, either in the short- or long-term, 
as a result of undertaking an action.
    Minimize means to reduce to the smallest amount or degree possible.
    Mitigation means all steps necessary to minimize the potentially 
adverse effects of the proposed action, and to restore and preserve the 
natural and beneficial floodplain values and to preserve and enhance 
natural values of wetlands.
    Natural Values of Floodplains and Wetlands means the qualities of or 
functions served by floodplains and wetlands which include but are not 
limited to: (a) Water resource values (natural

[[Page 84]]

moderation of floods, water quality maintenance, groundwater recharge); 
(b) living resource values (fish, wildlife, plant resources and 
habitats); (c) cultural resource values (open space, natural beauty, 
scientific study, outdoor education, archeological and historic sites, 
recreation); and (d) cultivated resource values (agriculture, 
aquaculture, forestry).
    New Construction means the construction of a new structure 
(including the placement of a mobile home) or facility or the 
replacement of a structure or facility which has been totally destroyed.
    New Construction in Wetlands includes draining, dredging, 
channelizing, filling, diking, impounding, and related activities and 
any structures or facilities begun or authorized after the effective 
dates of the Orders, May 24, 1977.
    Orders means Executive Orders 11988, Floodplain Management, and 
11990, Protection of Wetlands.
    Practicable means capable of being done within existing constraints. 
The test of what is practicable depends upon the situation and includes 
consideration of all pertinent factors, such as environment, cost and 
technology.
    Preserve means to prevent alterations to natural conditions and to 
maintain the values and functions which operate the floodplains or 
wetlands in their natural states.
    Regional Director means the Regional Director of the Federal 
Emergency Management Agency for the Region in which FEMA is acting or 
the Disaster Recovery Manager when one is designated.
    Regulatory Floodway means the area regulated by federal, State or 
local requirements to provide for the discharge of the base flood so the 
cumulative increase in water surface elevation is no more than a 
designated amount (not to exceed one foot as set by the National Flood 
Insurance Program).
    Restore means to reestablish a setting or environment in which the 
natural functions of the floodplain can again operate.
    SLPS means the State and Local Programs and Support Directorate.
    Structures means walled or roofed buildings, including mobile homes 
and gas or liquid storage tanks.
    Substantial Improvement means any repair, reconstruction or other 
improvement of a structure or facility, which has been damaged in excess 
of, or the cost of which equals or exceeds, 50% of the market value of 
the structure or replacement cost of the facility (including all 
``public facilities'' as defined in the Disaster Relief Act of 1974) (a) 
before the repair or improvement is started, or (b) if the structure or 
facility has been damaged and is proposed to be restored, before the 
damage occurred. If a facility is an essential link in a larger system, 
the percentage of damage will be based on the relative cost of repairing 
the damaged facility to the replacement cost of the portion of the 
system which is operationally dependent on the facility. The term 
``substantial improvement'' does not include any alteration of a 
structure or facility listed on the National Register of Historic Places 
or a State Inventory of Historic Places.
    Support means to encourage, allow, serve or otherwise facilitate 
floodplain or wetland development. Direct support results from actions 
within a floodplain or wetland, and indirect support results from 
actions outside of floodplains or wetlands.
    Wetlands means those areas which are inundated or saturated by 
surface or ground water with a frequency sufficient to support, or that 
under normal hydrologic conditions does or would support, a prevalence 
of vegetation or aquatic life typically adapted for life in saturated or 
seasonally saturated soil conditions. Examples of wetlands include, but 
are not limited to, swamps, fresh and salt water marshes, estuaries, 
bogs, beaches, wet meadows, sloughs, potholes, mud flats, river 
overflows and other similar areas. This definition includes those 
wetlands areas separated from their natural supply of water as a result 
of activities such as the construction of structural flood protection 
methods or solid-fill road beds and activities such as mineral 
extraction and navigation improvements. This definition is intended to 
be consistent with the definition utilized by the U.S. Fish and Wildlife 
Service in the publication entitled Classification of Wetlands and Deep

[[Page 85]]

Water Habitats of the United States (Cowardin, et al., 1977).

[45 FR 59526, Sept. 9, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
50 FR 40006, Oct. 1, 1985]



Sec. 9.5  Scope.

    (a) Applicability. (1) These regulations apply to all Agency actions 
which have the potential to affect floodplains or wetlands or their 
occupants, or which are subject to potential harm by location in 
floodplains or wetlands.
    (2) The basic test of the potential of an action to affect 
floodplains or wetlands is the action's potential (both by itself and 
when viewed cumulatively with other proposed actions) to result in the 
long- or short-term adverse impacts associated with:
    (i) The occupancy or modification of floodplains, and the direct and 
indirect support of floodplain development; or
    (ii) The destruction or modification of wetlands and the direct or 
indirect support of new construction in wetlands.
    (3) This regulation applies to actions that were, on the effective 
date of the Orders (May 24, 1977), ongoing, in the planning and/or 
development stages, or undergoing implementation, and are incomplete as 
of the effective date of these regulations. The regulation also applies 
to proposed (new) actions. The Agency shall:
    (i) Determine the applicable provisions of the Orders by analyzing 
whether the action in question has progressed beyond critical stages in 
the floodplain management and wetlands protection decision-making 
process, as set out below in Sec. 9.6. This determination need only be 
made at the time that followup actions are being taken to complete or 
implement the action in question; and
    (ii) Apply the provisions of the Orders and of this regulation to 
all such actions to the fullest extent practicable.
    (b) Limited exemption of ongoing actions involving wetlands located 
outside the floodplains. (1) Executive Order 11990, Protection of 
Wetlands, contains a limited exemption not found in Executive Order 
11988, Floodplain Management. Therefore, this exemption applies only to 
actions affecting wetlands which are located outside the floodplains, 
and which have no potential to result in harm to or within floodplains 
or to support floodplain development.
    (2) The following proposed actions that impact wetlands located 
outside of floodplains are exempt from this regulation:
    (i) Agency-assisted or permitted projects which were under 
construction before May 24, 1977; and
    (ii) Projects for which the Agency has proposed a draft of a final 
environmental impact statement (EIS) which adequately analyzes the 
action and which was filed before October 1, 1977. Proposed actions that 
impact wetlands outside of floodplains are not exempt if the EIS:
    (A) Only generally covers the proposed action;
    (B) Is devoted largely to related activities; or
    (C) Treats the project area or program without an adequate and 
specific analysis of the floodplain and wetland implications of the 
proposed action.
    (c) Decision-making involving certain categories of actions. The 
provisions set forth in this regulation are not applicable to the 
actions enumerated below except that the Regional Directors shall comply 
with the spirit of the Order to the extent practicable. For any action 
which is excluded from the actions enumerated below, the full 8-step 
process applies (see Sec. 9.6) (except as indicated at paragraphs (d), 
(f) and (g) of this section regarding other categories of partial or 
total exclusions). The provisions of these regulations do not apply to 
the following (all references are to the Disaster Relief Act of 1974, 
Pub. L. 93-288, as amended, except as noted):
    (1) Assistance provided for emergency work essential to save lives 
and protect property and public health and safety performed pursuant to 
sections 305 and 306;
    (2) Emergency Support Teams (section 304);
    (3) Unemployment Assistance (section 407);
    (4) Emergency Communications (section 415);
    (5) Emergency Public Transportation (section 416);

[[Page 86]]

    (6) Fire Suppression Assistance (section 417);
    (7) Community Disaster Loans (section 414), except to the extent 
that the proceeds of the loan will be used for repair of facilities or 
structures or for construction of additional facilities or structures;
    (8) The following Individual and Family Grant Program (section 408) 
actions:
    (i) Housing needs or expenses, except for restoring, repairing or 
building private bridges, purchase of mobile homes and provision of 
structures as minimum protective measures;
    (ii) Personal property needs or expenses;
    (iii) Transportation expenses;
    (iv) Medical/dental expenses;
    (v) Funeral expenses;
    (vi) Limited home repairs;
    (vii) Flood insurance premium;
    (viii) Cost estimates;
    (ix) Food expenses; and
    (x) Temporary rental accommodations.
    (9) Mortgage and rental assistance under section 404(b);
    (10) Use of existing resources in the temporary housing assistance 
program [section 404(a)], except that Step 1 (Sec. 9.7) shall be carried 
out;
    (11) Minimal home repairs [section 404(c)];
    (12) Debris removal (section 403), except those grants involving 
non-emergency disposal of debris within a floodplain or wetland;
    (13) Repairs or replacements under section 402, of less than $5,000 
to damaged structures or facilities.
    (14) Placement of families in existing resources and Temporary 
Relocation Assistance provided to those families so placed under the 
Comprehensive Environmental Response, Compensation, and Liability Act of 
1980, Public Law 96-510.
    (d) For each action enumerated below, the Regional Director shall 
apply steps 1, 2, 4, 5 and 8 of the decision-making process (Secs. 9.7, 
9.8, 9.10 and 9.11, see Sec. 9.6). Steps 3 and 6 (Sec. 9.9) shall be 
carried out except that alternative sites outside the floodplain or 
wetland need not be considered. After assessing impacts of the proposed 
action on the floodplain or wetlands and of the site on the proposed 
action, alternative actions to the proposed action, if any, and the ``no 
action'' alternative shall be considered. The Regional Director may also 
require certain other portions of the decision-making process to be 
carried out for individual actions as is deemed necessary. For any 
action which is excluded from the actions listed below. (except as 
indicated in paragraphs (c), (f) and (g) of this section regarding other 
categories of partial or total exclusion), the full 8-step process 
applies (see Sec. 9.6). The references are to the Disaster Relief Act of 
1974, Public Law 93-288, as amended.
    (1) Actions performed under the Individual and Family Grant Program 
(section 408) for restoring or repairing a private bridge, except where 
two or more individuals or families are authorized to pool their grants 
for this purpose.
    (2) Small project grants (section 419), except to the extent that 
federal funding involved is used for construction of new facilities or 
structures.
    (3) Replacement of building contents, materials and equipment. 
(sections 402 and 419).
    (4) Repairs under section 402 to damaged facilities or structures, 
except any such action for which one or more of the following is 
applicable:
    (i) FEMA estimated cost of repairs is more than 50% of the estimated 
reconstruction cost of the entire facility or structure, or is more than 
$100,000, or
    (ii) The action is located in a floodway or coastal high hazard 
area, or
    (iii) The facility or structure is one which has previously 
sustained structural damage from flooding due to a major disaster or 
emergency or on which a flood insurance claim has been paid, or
    (iv) The action is a critical action.
    (e) Other categories of actions. Based upon the completion of the 8-
step decision-making process (Sec. 9.6), the Director may find that a 
specific category of actions either offers no potential for carrying out 
the purposes of the Orders and shall be treated as those actions listed 
in Sec. 9.5(c), or has no practicable alternative sites and shall be 
treated as those actions listed in Sec. 9.5(d), or has no practicable 
alternative actions or sites

[[Page 87]]

and shall be treated as those actions listed in Sec. 9.5(g). This 
finding will be made in consultation with the Federal Insurance 
Administration and the Council on Environmental Quality as provided in 
section 2(d) of E.O. 11988. Public notice of each of these 
determinations shall include publication in the Federal Register and a 
30-day comment period.
    (f) The National Flood Insurance Program (NFIP). (1) Most of what is 
done by FIA or SLPS, in adminstering the National Flood Insurance 
Program is performed on a program-wide basis. For all regulations, 
procedures or other issuances making or amending program policy, FIA or 
SLPS, shall apply the 8-step decision-making process to that program-
wide action. The action to which the 8-step process must be applied is 
the establishment of programmatic standards or criteria, not the 
application of programmatic standards or criteria to specific 
situations. Thus, for example, FIA or SLPS, would apply the 8-step 
process to a programmatic determination of categories of structures to 
be insured, but not to whether to insure each individual structure. The 
two prime examples of where FIA or SLPS, does take site specific actions 
which would require individual application of the 8-step process are 
property acquisition under section 1362 of the National Flood Insurance 
Act of 1968, as amended, and the issuance of an exception to a community 
under 44 CFR 60.6(b). (See also Sec. 9.9(e)(6) and Sec. 9.11(e).)
    (2) The provisions set forth in this regulation are not applicable 
to the actions enumerated below except that the Federal Insurance 
Administrator or the Associate Director, SLPS, as appropriate shall 
comply with the spirit of the Orders to the extent practicable:
    (i) The issuance of individual flood insurance policies and policy 
interpretations;
    (ii) The adjustment of claims made under the Standard Flood 
Insurance Policy;
    (iii) The hiring of independent contractors to assist in the 
implementation of the National Flood Insurance Program;
    (iv) The issuance of individual flood insurance maps, Map 
Information Facility map determinations, and map amendments; and
    (v) The conferring of eligibility for emergency or regular program 
(NFIP) benefits upon communities.
    (g) For the action listed below, the Regional Director shall apply 
steps 1, 4, 5 and 8 of the decision-making process (Secs. 9.7, 9.10 and 
9.11). For any action which is excluded from the actions listed below, 
(except as indicated in paragraphs (c), (d) and (f) of this section 
regarding other categories of partial or total exclusion), the full 8-
step process applies (See Sec. 9.6). The Regional Director may also 
require certain other portions of the decision-making process to be 
carried out for individual actions as is deemed necessary. The 
references are to the Disaster Relief Act of 1974, Public Law 93-288. 
The above requirements apply to repairs, under section 402, between 
$5,000 and $25,000 to damaged structures of facilities except for:
    (1) Actions in a floodway or coastal high hazard area; or
    (2) New or substantially improved structures or facilities; or
    (3) Facilities or structures which have previously sustained 
structural damage from flooding due to a major disaster or emergency.

[45 FR 59526, Sept. 9, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
49 FR 35583, Sept. 10, 1984; 50 FR 40006, Oct. 1, 1985; 51 FR 39531, 
Oct. 29, 1986]



Sec. 9.6  Decision-making process.

    (a) Purpose. The purpose of this section is to set out the 
floodplain management and wetlands protection decision-making process to 
be followed by the Agency in applying the Orders to its actions. While 
the decision-making process was initially designed to address the 
floodplain Order's requirements, the process will also satisfy the 
wetlands Order's provisions due to the close similarity of the two 
directives. The numbering of Steps 1 through 8 does not firmly require 
that the steps be followed sequentially. As information is gathered 
throughout the decision-making process and as additional information is 
needed, reevaluation of lower numbered steps may be necessary.

[[Page 88]]

    (b) Except as otherwise provided in Sec. 9.5 (c), (d), (f), and (g) 
regarding categories of partial or total exclusion when proposing an 
action, the Agency shall apply the 8-step decision-making process. FEMA 
shall:
    Step 1. Determine whether the proposed action is located in a 
wetland and/or the 100-year floodplain (500-year floodplain for critical 
actions); and whether it has the potential to affect or be affected by a 
floodplain or wetland (see Sec. 9.7);
    Step 2. Notify the public at the earliest possible time of the 
intent to carry out an action in a floodplain or wetland, and involve 
the affected and interested public in the decision-making process (see 
Sec. 9.8);
    Step 3. Identify and evaluate practicable alternatives to locating 
the proposed action in a floodplain or wetland (including alternative 
sites, actions and the ``no action'' option) (see Sec. 9.9). If a 
practicable alternative exists outside the floodplain or wetland FEMA 
must locate the action at the alternative site.
    Step 4. Identify the potential direct and indirect impacts 
associated with the occupancy or modification of floodplains and 
wetlands and the potential direct and indirect support of floodplain and 
wetland development that could result from the proposed action (see 
Sec. 9.10);
    Step 5. Minimize the potential adverse impacts and support to or 
within floodplains and wetlands to be identified under Step 4, restore 
and preserve the natural and beneficial values served by floodplains, 
and preserve and enhance the natural and beneficial values served by 
wetlands (see Sec. 9.11);
    Step 6. Reevaluate the proposed action to determine first, if it is 
still practicable in light of its exposure to flood hazards, the extent 
to which it will aggravate the hazards to others, and its potential to 
disrupt floodplain and wetland values and second, if alternatives 
preliminarily rejected at Step 3 are practicable in light of the 
information gained in Steps 4 and 5. FEMA shall not act in a floodplain 
or wetland unless it is the only practicable location (see Sec. 9.9);
    Step 7. Prepare and provide the public with a finding and public 
explanation of any final decision that the floodplain or wetland is the 
only practicable alternative (see Sec. 9.12); and
    Step 8. Review the implementation and post-implementation phases of 
the proposed action to ensure that the requirements stated in Sec. 9.11 
are fully implemented. Oversight responsibility shall be integrated into 
existing processes.

[45 FR 59526, Sept. 9, 1980, as amended at 49 FR 35583, Sept. 10, 1984; 
50 FR 40006, Oct. 1, 1985]



Sec. 9.7  Determination of proposed action's location.

    (a) The purpose of this section is to establish Agency procedures 
for determining whether any action as proposed is located in or affects 
(1) the base floodplain (the Agency shall substitute the 500-year 
floodplain for the base floodplain where the action being proposed 
involves a critical action), or (2) a wetland.
    (b) Information needed. The Agency shall obtain enough information 
so that it can fulfill the requirements of the Orders to (1) avoid 
floodplain and wetland locations unless they are the only practicable 
alternatives; and (2) minimize harm to and within floodplains and 
wetlands. In all cases, FEMA shall determine whether the proposed action 
is located in a floodplain or wetland. In the absence of a finding to 
the contrary, FEMA may assume that a proposed action involving a 
facility or structure that has been flooded is in the floodplain. 
Information about the 100-year and 500-year floods and location of 
floodways and coastal high hazard areas may also be needed to comply 
with these regulations, especially Sec. 9.11. The following additional 
flooding characteristics shall be identified by the Regional Director as 
appropriate:
    (i) Velocity of floodwater;
    (ii) Rate of rise of floodwater;
    (iii) Duration of flooding;
    (iv) Available warning and evacuation time and routes;
    (v) Special problems:
    (A) Levees;
    (B) Erosion;
    (C) Subsidence;
    (D) Sink holes;
    (E) Ice jams;

[[Page 89]]

    (F) Debris load;
    (G) Pollutants;
    (H) Wave heights;
    (I) Groundwater flooding;
    (J) Mudflow.
    (c) Floodplain determination. (1) In the search for flood hazard 
information, FEMA shall follow the sequence below:
    (i) The Regional Director shall consult the FEMA Flood Insurance 
Rate Map (FIRM) the Flood Boundary Floodway Map (FBFM) and the Flood 
Insurance Study (FIS).
    (ii) If a detailed map (FIRM or FBFM) is not available, the Regional 
Director shall consult an FEMA Flood Hazard Boundary Map (FHBM) . If 
data on flood elevations, floodways, or coastal high hazard areas are 
needed, or if the map does not delineate the flood hazard boundaries in 
the vicinity of the proposed site, the Regional Director shall seek the 
necessary detailed information and assistance from the sources listed 
below.

                Sources of Maps and Technical Information

Department of Agriculture: Soil Conservation Service
Department of the Army: Corps of Engineers
Department of Commerce: National Oceanic and Atmospheric Administration
Federal Insurance Administration
FEMA Regional Offices/Natural and Technological Hazards Division
Department of the Interior:
    Geological Survey
    Bureau of Land Management
    Bureau of Reclamation
Tennessee Valley Authority
Delaware River Basin Commission
Susquehanna River Basin Commission
States

    (iii) If the sources listed do not have or know of the information 
necessary to comply with the Orders' requirements, the Regional Director 
shall seek the services of a Federal or other engineer experienced in 
this type of work.
    (2) If a decision involves an area or location within extensive 
Federal or state holdings or a headwater area, and an FIS, FIRM, FBFM, 
or FHBM is not available, the Regional Director shall seek information 
from the land administering agency before information and/or assistance 
is sought from the sources listed in this section. If none of these 
sources has information or can provide assistance, the services of an 
experienced Federal or other engineer shall be sought as described 
above.
    (d) Wetland determination. The following sequence shall be followed 
by the Agency in making the wetland determination.
    (1) The Agency shall consult with the U.S. Fish and Wildlife Service 
(FWS) for information concerning the location, scale and type of 
wetlands within the area which could be affected by the proposed action.
    (2) If the FWS does not have adequate information upon which to base 
the determination, the Agency shall consult wetland inventories 
maintained by the Army Corps of Engineers, the Environmental Protection 
Agency, various states, communities and others.
    (3) If state or other sources do not have adequate information upon 
which to base the determination, the Agency shall carry out an on-site 
analysis performed by a representative of the FWS or other qualified 
individual for wetlands characteristics based on the performance 
definition of what constitutes a wetland.
    (4) If an action is in a wetland but not in a floodplain, and the 
action is new construction, the provisions of this regulation shall 
apply. Even if the action is not in a wetland, the Regional Director 
shall determine if the action has the potential to result in indirect 
impacts on wetlands. If so, all adverse impacts shall be minimized. For 
actions which are in a wetland and the floodplain, completion of the 
decision-making process is required. (See Sec. 9.6.) In such a case the 
wetland will be considered as one of the natural and beneficial values 
of floodplain.

[45 FR 59526, Sept. 9, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
49 FR 33879, Aug. 27, 1984; 50 FR 40006, Oct. 1, 1985; 51 FR 34605, 
Sept. 30, 1986]



Sec. 9.8  Public notice requirements.

    (a) Purpose. The purpose of this section is to establish the initial 
notice procedures to be followed when proposing any action in or 
affecting floodplains or wetlands.
    (b) General. The Agency shall provide adequate information to enable 
the public to have impact on the decision

[[Page 90]]

outcome for all actions having potential to affect, adversely, or be 
affected by floodplains or wetlands that it proposes. To achieve this 
objective, the Agency shall:
    (1) Provide the public with adequate information and opportunity for 
review and comment at the earliest possible time and throughout the 
decision-making process; and upon completion of this process, provide 
the public with an accounting of its final decisions (see Sec. 9.12); 
and
    (2) Rely on its environmental assessment processes, to the extent 
possible, as vehicles for public notice, involvement and explanation.
    (c) Early public notice. The Agency shall provide opportunity for 
public involvement in the decision-making process through the provision 
of public notice upon determining that the proposed action can be 
expected to affect or be affected by floodplains or wetlands. Whenever 
possible, notice shall precede major project site identification and 
analysis in order to preclude the foreclosure of options consistent with 
the Orders.
    (1) For an action for which an environmental impact statement is 
being prepared, the Notice of Intent to File an EIS is adequate to 
constitute the early public notice, if it includes the information 
required under paragraph (c)(5) of this section.
    (2) For each action having national significance for which notice is 
being provided, the Agency shall use the Federal Register as the minimum 
means for notice, and shall provide notice by mail to national 
organizations reasonably expected to be interested in the action. The 
additional notices listed in paragraph (c)(4) of this section shall be 
used in accordance with the determination made under paragraph (c)(3) of 
this section.
    (3) The Agency shall base its determination of appropriate notices, 
adequate comment periods, and whether to issue cumulative notices 
(paragraphs (c)(4), (6) and (7) of this section) on factors which 
include, but are not limited to:
    (i) Scale of the action;
    (ii) Potential for controversy;
    (iii) Degree of public need;
    (iv) Number of affected agencies and individuals; and
    (v) Its anticipated potential impact.
    (4) For each action having primarily local importance for which 
notice is being provided, notice shall be made in accordance with the 
criteria under paragraph (c)(3) of this section, and shall entail as 
appropriate:
    (i) [Reserved]
    (ii) Notice to Indian tribes when effects may occur on reservations.
    (iii) Information required in the affected State's public notice 
procedures for comparable actions.
    (iv) Publication in local newspapers (in papers of general 
circulation rather than legal papers).
    (v) Notice through other local media.
    (vi) Notice to potentially interested community organizations.
    (vii) Publication in newsletters that may be expected to reach 
potentially interested persons.
    (viii) Direct mailing to owners and occupants of nearby or affected 
property.
    (ix) Posting of notice on and off site in the area where the action 
is to be located.
    (x) Holding a public hearing.
    (5) The notice shall include:
    (i) A description of the action, its purpose and a statement of the 
intent to carry out an action affecting or affected by a floodplain or 
wetland;
    (ii) Based on the factors in paragraph (c)(3) of this section, a map 
of the area or other indentification of the floodplain and/or wetland 
areas which is of adequate scale and detail so that the location is 
discernible; instead of publication of such map, FEMA may state that 
such map is available for public inspection, including the location at 
which such map may be inspected and a telephone number to call for 
information;
    (iii) Based on the factors in paragraph (c)(3) of this section, a 
description of the type, extent and degree of hazard involved and the 
floodplain or wetland values present; and
    (iv) Identification of the responsible official or organization for 
implementing the proposed action, and from whom further information can 
be obtained.

[[Page 91]]

    (6) The Agency shall provide for an adequate comment period.
    (7) In a post-disaster situation in particular, the requirement for 
early public notice may be met in a cumulative manner based on the 
factors set out in paragraph (c)(3) of this section. Several actions may 
be addressed in one notice or series of notices. For some actions 
involving limited public interest a single notice in a local newspaper 
or letter to interested parties may suffice.
    (d) Continuing public notice. The Agency shall keep the public 
informed of the progress of the decision-making process through 
additional public notices at key points in the process. The preliminary 
information provided under paragraph (c)(5) of this section shall be 
augmented by the findings of the adverse effects of the proposed actions 
and steps necessary to mitigate them. This responsibility shall be 
performed for actions requiring the preparation of an EIS, and all other 
actions having the potential for major adverse impacts, or the potential 
for harm to the health and safety of the general public.

[45 FR 59526, Sept. 9, 1980, as amended at 48 FR 29318, June 24, 1983]



Sec. 9.9  Analysis and reevaluation of practicable alternatives.

    (a) Purpose. (1) The purpose of this section is to expand upon the 
directives set out in Sec. 9.6, of this part, in order to clarify and 
emphasize the Orders' key requirements to avoid floodplains and wetlands 
unless there is no practicable alternative.
    (2) Step 3 is a preliminary determination as to whether the 
floodplain is the only practicable location for the action. It is a 
preliminary determination because it comes early in the decision-making 
process when the Agency has a limited amount of information. If it is 
clear that there is a practicable alternative, or the floodplain or 
wetland is itself not a practicable location, FEMA shall then act on 
that basis. Provided that the location outside the floodplain or wetland 
does not indirectly impact floodplains or wetlands or support 
development therein (see Sec. 9.10), the remaining analysis set out by 
this regulation is not required. If such location does indirectly impact 
floodplains or wetlands or support development therein, the remaining 
analysis set out by this regulation is required. If the preliminary 
determination is to act in the floodplain, FEMA shall gather the 
additional information required under Steps 4 and 5 and then reevaluate 
all the data to determine if the floodplain or wetland is the only 
practicable alternative.
    (b) Analysis of practicable alternatives. The Agency shall identify 
and evaluate practicable alternatives to carrying out a proposed action 
in floodplains or wetlands, including:
    (1) Alternative sites outside the floodplain or wetland;
    (2) Alternative actions which serve essentially the same purpose as 
the proposed action, but which have less potential to affect or be 
affected by the floodplain or wetlands; and
    (3) No action. The floodplain and wetland site itself must be a 
practicable location in light of the factors set out in this section.
    (c) The Agency shall analyze the following factors in determining 
the practicability of the alternatives set out in paragraph (b) of this 
section:
    (1) Natural environment (topography, habitat, hazards, etc.);
    (2) Social concerns (aesthetics, historical and cultural values, 
land patterns, etc.);
    (3) Economic aspects (costs of space, construction, services, and 
relocation); and
    (4) Legal constraints (deeds, leases, etc.).
    (d) Action following the analysis of practicable alternatives. (1) 
The Agency shall not locate the proposed action in the floodplain or in 
a wetland if a practicable alternative exists outside the floodplain or 
wetland.
    (2) For critical actions, the Agency shall not locate the proposed 
action in the 500-year floodplain if a practicable alternative exists 
outside the 500-year floodplain.
    (3) Even if no practicable alternative exists outside the floodplain 
or wetland, in order to carry out the action the floodplain or wetland 
must itself be a practicable location in light of the review required in 
this section.

[[Page 92]]

    (e) Reevaluation of alternatives. Upon determination of the impact 
of the proposed action to or within the floodplain or wetland and of 
what measures are necessary to comply with the requirement to minimize 
harm to and within floodplains and wetlands (Sec. 9.11), FEMA shall:
    (1) Determine whether:
    (i) The action is still practicable at a floodplain or wetland site 
in light of the exposure to flood risk and the ensuing disruption of 
natural values;
    (ii) The floodplain or wetland site is the only practicable 
alternative;
    (iii) There is a potential for limiting the action to increase the 
practicability of previously rejected non-floodplain or wetland sites 
and alternative actions; and
    (iv) Minimization of harm to or within the floodplain can be 
achieved using all practicable means.
    (2) Take no action in a floodplain unless the importance of the 
floodplain site clearly outweighs the requirement of E.O. 11988 to:
    (i) Avoid direct or indirect support of floodplain development;
    (ii) Reduce the risk of flood loss;
    (iii) Minimize the impact of floods on human safety, health and 
welfare; and
    (iv) Restore and preserve floodplain values.
    (3) Take no action in a wetland unless the importance of the wetland 
site clearly outweighs the requirements of E.O. 11990 to:
    (i) Avoid the destruction or modification of the wetlands;
    (ii) Avoid direct or indirect support of new construction in 
wetlands;
    (iii) Minimize the destruction, loss or degradation of wetlands; and
    (iv) Preserve and enhance the natural and beneficial values of 
wetlands.
    (4) In carrying out this balancing process, give the factors in 
paragraphs (e)(2) and (3) of this section, the great weight intended by 
the Orders.
    (5) Choose the ``no action'' alternative where there are no 
practicable alternative actions or sites and where the floodplain or 
wetland is not itself a practicable alternative. In making the 
assessment of whether a floodplain or wetland location is itself a 
practicable alternative, the practicability of the floodplain or wetland 
location shall be balanced against the practicability of not carrying 
out the action at all. That is, even if there is no practicable 
alternative outside of the floodplain or wetland, the floodplain or 
wetland itself must be a practicable location in order for the action to 
be carried out there. To be a practicable location, the importance of 
carrying out the action must clearly outweigh the requirements of the 
Orders listed in paragraphs (e)(2) and (e)(3) of this section. Unless 
the importance of carrying out the action clearly outweighs those 
requirements, the ``no action'' alternative shall be selected.
    (6) In any case in which the Regional Director has selected the ``no 
action'' option, FIA may not provide a new or renewed contract of flood 
insurance for that structure.

    Editorial Note: At 45 FR 79070, Nov. 28, 1980, Sec. 9.9(e)(6) was 
temporarily suspended until further notice.



Sec. 9.10  Identify impacts of proposed actions.

    (a) Purpose. The purpose of this section is to ensure that the 
effects of proposed Agency actions are identified.
    (b) The Agency shall identify the potential direct and indirect 
adverse impacts associated with the occupancy and modification of 
floodplains and wetlands and the potential direct and indirect support 
of floodplain and wetland development that could result from the 
proposed action. Such identification of impacts shall be to the extent 
necessary to comply with the requirements of the Orders to avoid 
floodplain and wetland locations unless they are the only practicable 
alternatives and to minimize harm to and within floodplains and 
wetlands.
    (c) This identification shall consider whether the proposed action 
will result in an increase in the useful life of any structure or 
facility in question, maintain the investment at risk and exposure of 
lives to the flood hazard or forego an opportunity to restore the 
natural and beneficial values served by floodplains or wetlands. 
Regional Offices of the U.S. Fish and Wildlife Service may be contacted 
to aid in the identification and evaluation of potential

[[Page 93]]

impacts of the proposed action on natural and beneficial floodplain and 
wetland values.
    (d) In the review of a proposed or alternative action, the Regional 
Director shall specifically consider and evaluate: impacts associated 
with modification of wetlands and floodplains regardless of its 
location; additional impacts which may occur when certain types of 
actions may support subsequent action which have additional impacts of 
their own; adverse impacts of the proposed actions on lives and property 
and on natural and beneficial floodplain and wetland values; and the 
three categories of factors listed below:
    (1) Flood hazard-related factors. These include for example, the 
factors listed in Sec. 9.7(b)(2);
    (2) Natural values-related factors. These include, for example, the 
following: Water resource values (natural moderation of floods, water 
quality maintenance, and ground water recharge); living resource values 
(fish and wildlife and biological productivity); cultural resource 
values (archeological and historic sites, and open space recreation and 
green belts); and agricultural, aquacultural and forestry resource 
values.
    (3) Factors relevant to a proposed action's effects on the survival 
and quality of wetlands. These include, for example, the following: 
Public health, safety, and welfare, including water supply, quality, 
recharge and discharge; pollution; flood and storm hazards; and sediment 
and erosion; maintenance of natural systems, including conservation and 
long term productivity of existing flora and fauna, species and habitat 
diversity and stability, hydrologic utility, fish, wildlife, timber, and 
food and fiber resources; and other uses of wetlands in the public 
interest, including recreational, scientific, and cultural uses.



Sec. 9.11  Mitigation.

    (a) Purpose. The purpose of this section is to expand upon the 
directives set out in Sec. 9.6 of this part, and to set out the 
mitigative actions required if the preliminary determination is made to 
carry out an action that affects or is in a floodplain or wetland.
    (b) General provisions. (1) The Agency shall design or modify its 
actions so as to minimize harm to or within the floodplain;
    (2) The Agency shall minimize the destruction, loss or degradation 
of wetlands;
    (3) The Agency shall restore and preserve natural and beneficial 
floodplain values; and
    (4) The Agency shall preserve and enhance natural and beneficial 
wetland values.
    (c) Minimization provisions. The Agency shall minimize:
    (1) Potential harm to lives and the investment at risk from the base 
flood, or, in the case of critical actions, from the 500-year flood;
    (2) Potential adverse impacts the action may have on others; and
    (3) Potential adverse impact the action may have on floodplain and 
wetland values.
    (d) Minimization Standards. In its implementation of the Disaster 
Relief Act of 1974, the Agency shall apply at a minimum, the following 
standards to its actions to comply with the requirements of paragraphs 
(b) and (c), of this section, (except as provided in Sec. 9.5 (c), (d), 
and (g) regarding categories of partial or total exclusion). Any Agency 
action to which the following specific requirements do not apply, shall 
nevertheless be subject to the full 8-step process (Sec. 9.6) including 
the general requirement to minimize harm to and within floodplains:
    (1) There shall be no new construction or substantial improvement in 
a floodway, and no new construction in a coastal high hazard area, 
except for:
    (i) A functionally dependent use; or
    (ii) A structure or facility which facilitates an open space use.
    (2) For a structure which is a functionally dependent use, or which 
facilitates an open space use, the following applies. There shall be no 
construction of a new or substantially improved structure in a coastal 
high hazard area unless it is elevated on adequately anchored pilings or 
columns, and securely anchored to such piles or columns so that the 
lowest portion of the structural members of the lowest floor (excluding 
the pilings or columns) is elevated to or above the base flood level

[[Page 94]]

(the 500-year flood level for critical actions) (including wave height). 
The structure shall be anchored so as to withstand velocity waters and 
hurricane wave wash. The Regional Director shall be responsible for 
determining the base flood level, including the wave height, in all 
cases. Where there is a FIRM in effect, it shall be the basis of the 
Regional Director's determination. If the FIRM does not reflect wave 
heights, or if there is no FIRM in effect, the Regional Director is 
responsible for delineating the base flood level, including wave 
heights.
    (3) Elevation of structures. (i) There shall be no new construction 
or substantial improvement of structures unless the lowest floor of the 
structures (including basement) is at or above the level of the base 
flood.
    (ii) There shall be no new construction or substantial improvement 
of structures involving a critical action unless the lowest floor of the 
structure (including the basement) is at or above the level of the 500-
year flood.
    (iii) If the subject structure is nonresidential, FEMA may, instead 
of elevating the structure to the 100-year or 500-year level, as 
appropriate, approve the design of the structure and its attendant 
utility and sanitary facilities so that below the flood level the 
structure is water tight with walls substantially impermeable to the 
passage of water and with structural components having the capability of 
resisting hydrostatic and hydrodynamic loads and effects of buoyancy.
    (iv) The provisions of paragraphs (d)(3)(i), (ii), and (iii) of this 
section do not apply to the extent that the Federal Insurance 
Administration has granted an exception under 44 CFR Sec. 60.6(b) 
(formerly 24 CFR 1910.6(b)), or the community has granted a variance 
which the Regional Director determines is consistent with 44 CFR 60.6(a) 
(formerly 24 CFR 1910.6(a)). In a community which does not have a FIRM 
in effect, FEMA may approve a variance from the standards of paragraphs 
(d)(3)(i), (ii), and (iii) of this section, after compliance with the 
standards of 44 CFR 60.6(a).
    (4) There shall be no encroachments, including fill, new 
construction, substantial improvements of structures or facilities, or 
other development within a designated regulatory floodway that would 
result in any increase in flood levels within the community during the 
occurrence of the base flood discharge. Until a regulatory floodway is 
designated, no new construction, substantial improvements, or other 
development (including fill) shall be permitted within the base 
floodplain unless it is demonstrated that the cumulative effect of the 
proposed development, when combined with all other existing and 
anticipated development, will not increase the water surface elevation 
of the base flood more than one foot at any point within the community.
    (5) Even if an action is a functionally dependent use or facilitates 
open space uses (under paragraph (d) (1) or (2) of this section) and 
does not increase flood heights (under paragraph (d)(4) of this 
section), such action may only be taken in a floodway or coastal high 
hazard area if:
    (i) Such site is the only practicable alternative; and
    (ii) Harm to and within the floodplain is minimized.
    (6) In addition to standards (d)(1) through (d)(5) of this section, 
no action may be taken if it is inconsistent with the criteria of the 
National Flood Insurance Program (44 CFR part 59 et seq.) or any more 
restrictive Federal, State or local floodplain management standards.
    (7) New construction and substantial improvement of structures shall 
be elevated on open works (walls, columns, piers, piles, etc.) rather 
than on fill, in all cases in coastal high hazard areas and elsewhere, 
where practicable.
    (8) To minimize the effect of floods on human health, safety and 
welfare, the Agency shall:
    (i) Where appropriate, integrate all of its proposed actions in 
floodplains into existing flood warning and preparedness plans and 
ensure that available flood warning time is reflected;
    (ii) Facilitate adequate access and egress to and from the site of 
the proposed action; and
    (iii) Give special consideration to the unique hazard potential in 
flash flood, rapid-rise or tsunami areas.

[[Page 95]]

    (9) In the replacement of building contents, materials and 
equipment, the Regional Director shall require as appropriate, disaster 
proofing of the building and/or elimination of such future losses by 
relocation of those building contents, materials and equipment outside 
or above the base floodplain or the 500-year floodplain for critical 
actions.
    (e) In the implementation of the National Flood Insurance Program. 
(1) The Federal Insurance Administration shall make identification of 
all coastal high hazard areas a priority;
    (2) Beginning October 1, 1981, the Federal Insurance Administration 
of FEMA may only provide flood insurance for new construction or 
substantial improvements in a coastal high hazard area if:
    (i) Wave heights have been designated for the site of the structure 
either by the Director of FEMA based upon data generated by FEMA or by 
another source, satisfactory to the Director; and
    (ii) The structure is rated by FEMA-FIA based on a system which 
reflects the capacity to withstand the effects of the 100-year frequency 
flood including, but not limited to, the following factors:
    (A) Wave heights;
    (B) The ability of the structure to withstand the force of waves.
    (3)(i) FEMA shall accept and take fully into account information 
submitted by a property owner indicating that the rate for a particular 
structure is too high based on the ability of the structure to withstand 
the force of waves. In order to obtain a rate adjustment, a property 
owner must submit to FEMA specific information regarding the structure 
and its immediate environment. Such information must be certified by a 
registered professional architect or engineer who has demonstrable 
experience and competence in the fields of foundation, soils, and 
structural engineering. Such information should include:
    (A) Elevation of the structure (bottom of lowest floor beam) in 
relation to the Base Flood Elevation including wave height;
    (B) Distance of the structure from the shoreline;
    (C) Dune protection and other environmental factors;
    (D) Description of the building support system; and
    (E) Other relevant building details.

Adequate completion of the ``V-Zone Risk Factor Rating Form'' is 
sufficient for FEMA to determine whether a rate adjustment is 
appropriate. The form is available from and applications for rate 
adjustments should be submitted to:

National Flood Insurance Program
Attention: V-Zone Underwriting Specialist
9901-A George Palmer Highway
Lanham, MD 20706


Pending a determination on a rate adjustment, insurance will be issued 
at the class rate. If the rate adjustment is granted, a refund of the 
appropriate portion of the premium will be made. Unless a property owner 
is seeking an adjustment of the rate prescribed by FEMA-FIA, this 
information need not be submitted.
    (ii) FIA shall notify communities with coastal high hazard areas and 
federally related lenders in such communities, of the provisions of this 
paragraph. Notice to the lenders may be accomplished by the Federal 
instrumentalities to which the lenders are related.
    (4) In any case in which the Regional Director has been, pursuant to 
Sec. 9.11(d)(1), precluded from providing assistance for a new or 
substantially improved structure in a floodway, FIA may not provide a 
new or renewed policy of flood insurance for that structure.
    (f) Restore and preserve. (1) For any action taken by the Agency 
which affects the floodplain or wetland and which has resulted in, or 
will result in, harm to the floodplain or wetland, the Agency shall act 
to restore and preserve the natural and beneficial values served by 
floodplains and wetlands.
    (2) Where floodplain or wetland values have been degraded by the 
proposed action, the Agency shall identify, evaluate and implement 
measures to restore the values.
    (3) If an action will result in harm to or within the floodplain or 
wetland, the Agency shall design or modify the action to preserve as 
much of the natural

[[Page 96]]

and beneficial floodplain and wetland values as is possible.

[45 FR 59526, Sept. 9, 1980, as amended at 46 FR 51752, Oct. 22, 1981; 
48 FR 44543, Sept. 29, 1983; 49 FR 33879, Aug. 27, 1984; 49 FR 35584, 
Sept. 10, 1984; 50 FR 40006, Oct. 1, 1985]

    Editorial Note: At 45 FR 79070, Nov. 28, 1980, Sec. 9.11(e)(4) was 
temporarily suspended until further notice.



Sec. 9.12  Final public notice.

    If the Agency decides to take an action in or affecting a floodplain 
or wetland, it shall provide the public with a statement of its final 
decision and shall explain the relevant factors considered by the Agency 
in making this determination.
    (a) In addition, those sent notices under Sec. 9.8 shall also be 
provided the final notice.
    (b) For actions for which an environmental impact statement is being 
prepared, the FEIS is adequate to constitute final notice in all cases 
except where:
    (1) Significant modifications are made in the FEIS after its initial 
publication;
    (2) Significant modifications are made in the development plan for 
the proposed action; or
    (3) Significant new information becomes available in the interim 
between issuance of the FEIS and implementation of the proposed action.

If any of these situations develop, the Agency shall prepare a separate 
final notice that contains the contents of paragraph (e) of this section 
and shall make it available to those who received the FEIS. A minimum of 
15 days shall, without good cause shown, be allowed for comment on the 
final notice.
    (c) For actions for which an environmental assessment was prepared, 
the Notice of No Significant Impact is adequate to constitute final 
public notice, if it includes the information required under paragraph 
(e) of this section.
    (d) For all other actions, the finding shall be made in a document 
separate from those described in paragraphs (a), (b), and (c) of this 
section. Based on an assessment of the following factors, the 
requirement for final notice may be met in a cumulative manner:
    (1) Scale of the action;
    (2) Potential for controversy;
    (3) Degree of public need;
    (4) Number of affected agencies and individuals;
    (5) Its anticipated potential impact; and
    (6) Similarity of the actions, i.e., to the extent that they are 
susceptible of common descriptions and assessments.

When a damaged structure or facility is already being repaired by the 
State or local government at the time of the Damage Survey Report, the 
requirements of Steps 2 and 7 (Secs. 9.8 and 9.12) may be met by a 
single notice. Such notice shall contain all the information required by 
both sections.
    (e) The final notice shall include the following:
    (1) A statement of why the proposed action must be located in an 
area affecting or affected by a floodplain or a wetland;
    (2) A description of all significant facts considered in making this 
determination;
    (3) A list of the alternatives considered;
    (4) A statement indicating whether the action conforms to applicable 
state and local floodplain protection standards;
    (5) A statement indicating how the action affects or is affected by 
the floodplain and/or wetland, and how mitigation is to be achieved;
    (6) Identification of the responsible official or organization for 
implementation and monitoring of the proposed action, and from whom 
further information can be obtained; and
    (7) A map of the area or a statement that such map is available for 
public inspection, including the location at which such map may be 
inspected and a telephone number to call for information.
    (f) After providing the final notice, the Agency shall, without good 
cause shown, wait at least 15 days before carrying out the action.

[45 FR 59526, Sept. 9, 1980, as amended at 48 FR 29318, June 24, 1983]



Sec. 9.13  Particular types of temporary housing.

    (a) The purpose of this section is to set forth the procedures 
whereby the Agency will provide certain specified types of temporary 
housing.

[[Page 97]]

    (b) Prior to providing the types of temporary housing enumerated in 
paragraph (c) of this section, the Agency shall comply with the 
provisions of this section. For all temporary housing not enumerated 
below, the full 8-step process (see Sec. 9.6) applies.
    (c) The following temporary housing actions are subject to the 
provisions of this section and not the full 8-step process:
    (1) [Reserved]
    (2) Placing a mobile home or readily fabricated dwelling on a 
private or commercial site, but not a group site.
    (d) The actions set out in paragraph (c) of this section are subject 
to the following decision-making process:
    (1) The temporary housing action shall be evaluated in accordance 
with the provisions of Sec. 9.7 to determine if it is in or affects a 
floodplain or wetland.
    (2) No mobile home or readily fabricated dwelling may be placed on a 
private or commercial site in a floodway or coastal high hazard area.
    (3) An individual or family shall not be housed in a floodplain or 
wetland unless the Regional Director has complied with the provisions of 
Sec. 9.9 to determine that such site is the only practicable 
alternative. The following factors shall be substituted for the factors 
in Sec. 9.9 (c) and (e) (2) through (4):
    (i) Speedy provision of temporary housing;
    (ii) Potential flood risk to the temporary housing occupant;
    (iii) Cost effectiveness;
    (iv) Social and neighborhood patterns;
    (v) Timely availability of other housing resources; and
    (vi) Potential harm to the floodplain or wetland.
    (4) An individual or family shall not be housed in a floodplain or 
wetland (except in existing resources) unless the Regional Director has 
complied with the provisions of Sec. 9.11 to minimize harm to and within 
floodplains and wetlands. The following provisions shall be substituted 
for the provisions of Sec. 9.11(d) for mobile homes:
    (i) No mobile home or readily fabricated dwelling may be placed on a 
private or commercial site unless it is elevated to the fullest extent 
practicable up to the base flood level and adequately anchored.
    (ii) No mobile home or readily fabricated dwelling may be placed if 
such placement is inconsistent with the criteria of the National Flood 
Insurance Program (44 CFR part 59 et seq.) or any more restrictive 
Federal, State or local floodplain management standard. Such standards 
may require elevation to the base flood level in the absence of a 
variance.
    (iii) Mobile homes shall be elevated on open works (walls, columns, 
piers, piles, etc.) rather than on fill where practicable.
    (iv) To minimize the effect of floods on human health, safety and 
welfare, the Agency shall:
    (A) Where appropriate, integrate all of its proposed actions in 
placing mobile homes for temporary housing in floodplains into existing 
flood warning and preparedness plans and ensure that available flood 
warning time is reflected;
    (B) Provide adequate access and egress to and from the proposed site 
of the mobile home; and
    (C) Give special consideration to the unique hazard potential in 
flash flood and rapid-rise areas.
    (5) FEMA shall comply with Step 2 Early Public Notice (Sec. 9.8(c)) 
and Step 7 Final Public Notice (Sec. 9.12). In providing these notices, 
the emergency nature of temporary housing shall be taken into account.
    (e) FEMA shall not sell or otherwise dispose of mobile homes or 
other readily fabricated dwellings which would be located in floodways 
or coastal high hazard areas. FEMA shall not sell or otherwise dispose 
of mobile homes or other readily fabricated dwellings which would be 
located in floodplains or wetlands unless there is full compliance with 
the 8-step process. Given the vulnerability of mobile homes to flooding, 
a rejection of a non-floodplain location alternative and of the no-
action alternative shall be based on (1) a compelling need of the family 
or individual to buy a mobile home for permanent housing, and (2) a 
compelling requirement to locate the unit in a floodplain. Further, FEMA 
shall not sell or otherwise dispose of mobile homes or other

[[Page 98]]

readily fabricated dwellings in a floodplain unless they are elevated at 
least to the level of the 100-year flood. The Regional Director shall 
notify the Associate Director for State and Local Programs and Support 
of each instance where a floodplain location has been found to be the 
only practicable alternative for a mobile home sale.

[45 FR 59526, Sept. 9, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
49 FR 35584, Sept. 10, 1984; 50 FR 40006, Oct. 1, 1985]



Sec. 9.14  Disposal of Agency property.

    (a) The purpose of this section is to set forth the procedures 
whereby the Agency shall dispose of property.
    (b) Prior to its disposal by sale, lease or other means of disposal, 
property proposed to be disposed of by the Agency shall be reviewed 
according to the decision-making process set out in Sec. 9.6 of this 
part, as follows:
    (1) The property shall be evaluated in accordance with the 
provisions of Sec. 9.7 to determine if it affects or is affected by a 
floodplain or wetland;
    (2) The public shall be notified of the proposal and involved in the 
decision-making process in accordance with the provisions of Sec. 9.8;
    (3) Practicable alternatives to disposal shall be evaluated in 
accordance with the provisions of Sec. 9.9. For disposals, this 
evaluation shall focus on alternative actions (conveyance for an 
alternative use that is more consistent with the floodplain management 
and wetland protection policies set out in Sec. 9.2 than the one 
proposed, e.g., open space use for park or recreational purposes rather 
than high intensity uses), and on the ``no action'' option (retain the 
property);
    (4) Identify the potential impacts and support associated with the 
disposal of the property in accordance with Sec. 9.10;
    (5) Identify the steps necessary to minimize, restore, preserve and 
enhance in accordance with Sec. 9.11. For disposals, this analysis shall 
address all four of these components of mitigation where unimproved 
property is involved, but shall focus on minimization through 
floodproofing and restoration of natural values where improved property 
is involved;
    (6) Reevaluate the proposal to dispose of the property in light of 
its exposure to the flood hazard and its natural values-related impacts, 
in accordance with Sec. 9.9. This analysis shall focus on whether it is 
practicable in light of the findings from Secs. 9.10 and 9.11 to dispose 
of the property, or whether it must be retained. If it is determined 
that it is practicable to dispose of the property, this analysis shall 
identify the practicable alternative that best achieves all of the 
components of the Orders' mitigation responsibility;
    (7) To the extent that it would decrease the flood hazard to lives 
and property, the Agency shall, wherever practicable, dispose of the 
properties according to the following priorities:
    (i) Properties located outside the floodplain;
    (ii) Properties located in the flood fringe; and
    (iii) Properties located in a floodway, regulatory floodway or 
coastal high hazard area.
    (8) The Agency shall prepare and provide the public with a finding 
and public explanation in accordance with Sec. 9.12.
    (9) The Agency shall ensure that the applicable mitigation 
requirements are fully implemented in accordance with Sec. 9.11.
    (c) At the time of disposal, for all disposed property, the Agency 
shall reference in the conveyance uses that are restricted under 
existing Federal, State and local floodplain management and wetland 
protection standards relating to flood hazards and floodplain and 
wetland values.



Sec. 9.15  Planning programs affecting land use.

    The Agency shall take floodplain management into account when 
formulating or evaluating any water and land use plans. No plan may be 
approved unless it:
    (a) Reflects consideration of flood hazards and floodplain 
management and wetlands protection; and
    (b) Prescribes planning procedures to implement the policies and 
requirements of the Orders and this regulation.

[[Page 99]]



Sec. 9.16  Guidance for applicants.

    (a) The Agency shall encourage and provide adequate guidance to 
applicants for agency assistance to evaluate the effects of their plans 
and proposals in or affecting floodplains and wetlands.
    (b) This shall be accomplished primarily through amendment of all 
Agency instructions to applicants, e.g., program handbooks, contracts, 
application and agreement forms, etc., and also through contact made by 
agency staff during the normal course of their activities, to fully 
inform prospective applicants of:
    (1) The Agency's policy on floodplain management and wetlands 
protection as set out in Sec. 9.2;
    (2) The decision-making process to be used by the Agency in making 
the determination of whether to provide the required assistance as set 
out in Sec. 9.6;
    (3) The nature of the Orders' practicability analysis as set out in 
Sec. 9.9;
    (4) The nature of the Orders' mitigation responsibilities as set out 
in Sec. 9.11;
    (5) The nature of the Orders' public notice and involvement process 
as set out in Secs. 9.8 and 9.12; and
    (6) The supplemental requirements applicable to applications for the 
lease or other disposal of Agency owned properties set out in Sec. 9.14.
    (c) Guidance to applicants shall be provided where possible, prior 
to the time of application in order to minimize potential delays in 
process application due to failure of applicants to recognize and 
reflect the provisions of the Orders and this regulation.



Sec. 9.17  Instructions to applicants.

    (a) Purpose. In accordance with Executive Orders 11988 and 11990, 
the Federal executive agencies must respond to a number of floodplain 
management and wetland protection responsibilities before carrying out 
any of their activities, including the provision of Federal financial 
and technical assistance. The purpose of this section is to put 
applicants for Agency assistance on notice concerning both the criteria 
that it is required to follow under the Orders, and applicants' 
responsibilities under this regulation.
    (b) Responsibilities of Applicants. Based upon the guidance provided 
by the Agency under Sec. 9.16, that guidance included in the U.S. Water 
Resources Council's Guidance for Implementing E.O. 11988, and based upon 
the provisions of the Orders and this regulation, applicants for Agency 
assistance shall recognize and reflect in their application:
    (1) The Agency's policy on floodplain management and wetlands 
protection as set out in Sec. 9.2;
    (2) The decision-making process to be used by the Agency in making 
the determination of whether to provide the requested assistance as set 
out in Sec. 9.6;
    (3) The nature of the Orders' practicability analysis as set out in 
Sec. 9.9;
    (4) The nature of the Orders' mitigation responsibilities as set out 
in Sec. 9.11;
    (5) The nature of the Orders' public and involvement process as set 
out in Secs. 9.8 and 9.12; and
    (6) The supplemental requirements for application for the lease or 
other disposal of Agency-owned properties, as set out in Sec. 9.13.
    (c) Provision of supporting information. Applicants for Agency 
assistance may be called upon to provide supporting information relative 
to the various responsibilities set out in paragraph (b) of this section 
as a prerequisite to the approval of their applications.
    (d) Approval of applications. Applications for Agency assistance 
shall be reviewed for the recognition and reflection of the provisions 
of this regulation in addition to the Agency's existing approval 
criteria.



Sec. 9.18  Responsibilities.

    (a) Regional Directors' responsibilities. Regional Directors shall, 
for all actions falling within their respective jurisdictions:
    (1) Implement the requirements of the Orders and this regulation. 
Anywhere in Secs. 9.2, 9.6 through 9.13, and 9.15 where a direction is 
given to the Agency, it is the responsibility of the Regional Director.
    (2) Consult with the General Counsel regarding any question of 
interpretation concerning this regulation or the Orders.
    (b) Associate Directors' responsibilities. Associate Directors/
Administrators shall ensure that the offices/administrations under their 
jurisdiction:

[[Page 100]]

    (1) Implement the requirements of the Orders and this regulation. 
When a decision of a Regional Director relating to disaster assistance 
is appealed, the Associate Director for State and Local Programs and 
Support may make determinations under these regulations on behalf of the 
Agency.
    (2) Identify within ninety (90) days of the effective date of this 
regulation:
    (i) The modifications that are necessary to make their existing 
floodplain management and wetlands protection procedures adequate to 
meet the directives of the Orders;
    (ii) Which of these modifications should be made a part of this 
regulation;
    (iii) Which of these modifications are to be included in program 
regulations other than this one; and
    (iv) The steps being taken to prepare and implement these 
modifications.
    (3) Are in full compliance with the Orders' provisions through the 
modification of their processes in accordance with paragraphs (b) (1) 
and (2) of this section.
    (4) Prepare and submit to the Office of General Counsel reports to 
the Office of Management and Budget in accordance with section 2(b) of 
E.O. 11988 and section 3 of E.O. 11990. If a proposed action is to be 
located in a floodplain or wetland, any requests to the Office of 
Management and Budget for new authorizations or appropriations shall be 
accompanied by a report indicating whether the proposed action is in 
accord with the Orders and these regulations.

[45 FR 59526, Sept. 9, 1980, as amended at 49 FR 33879, Aug. 27, 1984]

[[Page 101]]

[GRAPHIC] [TIFF OMITTED] TC02FE91.074





PART 10--ENVIRONMENTAL CONSIDERATIONS--Table of Contents




                           Subpart A--General

Sec.
10.1  Background and purpose.
10.2  Applicability and scope.
10.3  Definitions.
10.4  Policy.

                Subpart B--Agency Implementing Procedures

10.5  Responsibilities.
10.6  Making or amending policy.
10.7  Planning.
10.8  Determination of requirement for environmental review.
10.9  Preparation of environmental assessments.
10.10  Preparation of environmental impact statements.
10.11  Environmental information.
10.12  Pre-implementation actions.
10.13  Emergencies.
10.14  Flood plains and wetlands.

    Authority: 42 U.S.C. 4321 et seq.; E.O. 11514 of March 7, 1970, 35 
FR 4247, as amended by E. O. 11991 of March 24, 1977, 3 CFR, 1977 Comp., 
p. 123; Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 1978 
Comp., p. 329; E.O. 12127 of March 31, 1979, 44 FR 19367, 3 CFR, 1979 
Comp., p. 376; E.O. 12148 of July 20, 1979, 44 FR 43239, 3 CFR, 1979 
Comp., p. 412, as amended.

    Source: 45 FR 41142, June 18, 1980, unless otherwise noted.

[[Page 102]]



                           Subpart A--General



Sec. 10.1  Background and purpose.

    (a) This part implements the Council on Environmental Quality (CEQ) 
regulations (National Environmental Policy Act Regulations, 43 FR 55978 
(1978)) and provides policy and procedures to enable Federal Emergency 
Management Agency (FEMA) officials to be informed of and take into 
account environmental considerations when authorizing or approving major 
FEMA actions that significantly affect the environment in the United 
States. The Council on Environmental Quality Regulations implement the 
procedural provisions, section 102(2), of the National Environmental 
Policy Act of 1969, as amended (hereinafter NEPA) (Pub. L. 91-190, 42 
U.S.C. 4321 et seq.), and Executive Order 11991, 42 FR 26967 (1977).
    (b) Section 1507.3, Council on Environmental Quality Regulations 
(National Environmental Policy Act Regulations, 43 FR 55978 (1978)) 
directs that Federal agencies shall adopt procedures to supplement the 
CEQ regulations. This regulation provides detailed FEMA implementing 
procedures to supplement the CEQ regulations.
    (c) The provisions of this part must be read together with those of 
the CEQ regulations and NEPA as a whole when applying the NEPA process.



Sec. 10.2  Applicability and scope.

    The provisions of this part apply to the Federal Emergency 
Management Agency, (hereinafter referred to as FEMA) including any 
office or administration of FEMA, and the FEMA regional offices.



Sec. 10.3  Definitions.

    (a) Regional Director means the Regional Director of the Federal 
Emergency Management Agency for the region in which FEMA is acting.
    (b) The other terms used in this part are defined in the CEQ 
regulations (40 CFR part 1508).
    (c) Environmental Officer means the Chief, Public Assistance 
Division, Office of Disaster Assistance Programs, State and Local 
Programs and Support Directorate.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
50 FR 40006, Oct. 1, 1985]



Sec. 10.4  Policy.

    (a) FEMA shall act with care to assure that, in carrying out its 
responsibilities, including disaster planning, response and recovery and 
hazard mitigation and flood insurance, it does so in a manner consistent 
with national environmental policies. Care shall be taken to assure, 
consistent with other considerations of national policy, that all 
practical means and measures are used to protect, restore, and enhance 
the quality of the environment, to avoid or minimize adverse 
environmental consequences, and to attain the objectives of:
    (1) Achieving use of the environment without degradation, or 
undesirable and unintended consequences;
    (2) Preserving historic, cultural and natural aspects of national 
heritage and maintaining, wherever possible, an environment that 
supports diversity and variety of individual choice;
    (3) Achieving a balance between resource use and development within 
the sustained carrying capacity of the ecosystem involved; and
    (4) Enhancing the quality of renewable resources and working toward 
the maximum attainable recycling of depletable resources.
    (b) FEMA shall:
    (1) Assess environmental consequences of FEMA actions in accordance 
with Secs. 10.9 and 10.10 of this part and parts 1500 through 1508 of 
the CEQ regulations;
    (2) Use a systematic, interdisciplinary approach that will ensure 
the integrated use of the natural and social sciences, and environmental 
considerations, in planning and decisionmaking where there is a 
potential for significant environmental impact;
    (3) Ensure that presently unmeasured environmental amenities are 
considered in the decisionmaking process;
    (4) Consider reasonable alternatives to recommended courses of 
action in any proposal that involves conflicts concerning alternative 
uses of resources; and

[[Page 103]]

    (5) Make available to States, counties, municipalities, institutions 
and individuals advice and information useful in restoring, maintaining, 
and enhancing the quality of the environment.



                Subpart B--Agency Implementing Procedures



Sec. 10.5  Responsibilities.

    (a) The Regional Directors shall, for each action not categorically 
excluded from this regulation and falling within their respective 
jurisdictions:
    (1) Prepare an environmental assessment and submit such assessment 
to the Environmental Officer and the Office of General Counsel (OGC);
    (2) Prepare a finding of no significant impact, or prepare an 
environmental impact statement;
    (3) Coordinate and provide information regarding environmental 
review with applicants for FEMA assistance;
    (4) Prepare and maintain an administrative record for each proposal 
that is determined to be categorically excluded from this regulation;
    (5) Involve environmental agencies, applicants, and the public to 
the extent practicable in preparing environmental assessments;
    (6) Prepare, as required, a supplement to either the draft or final 
environmental impact statement;
    (7) Circulate draft and final environmental impact statements;
    (8) Ensure that decisions are made in accordance with the policies 
and procedures of NEPA and this part, and prepare a concise public 
record of such decisions;
    (9) Consider mitigating measures to avoid or minimize environmental 
harm, and, in particular, harm to and within floodplains and wetlands; 
and
    (10) Review and comment upon, as appropriate, environmental 
assessments and impact statements of other Federal agencies and of State 
and local entities within their respective regions.
    (b) The Environmental Officer shall:
    (1) Determine, on the basis of the environmental assessment whether 
an environmental impact statement is required, or whether a finding of 
no significant impact shall be prepared;
    (2) Review all proposed changes or additions to the list of 
categorical exclusions;
    (3) Review all findings of no significant impact;
    (4) Review all proposed draft and final environmental statements;
    (5) Publish the required notices in the Federal Register;
    (6) Provide assistance in the preparation of environmental 
assessments and impact statements and assign lead agency responsibility 
when more than one FEMA office or administration is involved;
    (7) Direct the preparation of environmental documents for specific 
actions when required;
    (8) Comply with the requirements of this part when the Director of 
FEMA promulgates regulations, procedures or other issuances making or 
amending Agency policy;
    (9) Provide, when appropriate, consolidated FEMA comments on draft 
and final impact statements prepared for the issuance of regulations and 
procedures of other agencies;
    (10) Review FEMA issuances that have environmental implications;
    (11) Maintain liaison with the Council on Environmental Quality, the 
Environmental Protection Agency, the Office of Management and Budget, 
other Federal agencies, and State and local groups, with respect to 
environmental analysis for FEMA actions affecting the environment.
    (c) The Heads of the Office and Administrations of FEMA shall:
    (1) Assess environmental consequences of proposed and on-going 
programs within their respective organizational units;
    (2) Prepare and process environmental assessments and environmental 
impact statements for all regulations, procedures and other issuances 
making or amending program policy related to actions which do not 
qualify for categorical exclusions;
    (3) Integrate environmental considerations into their decisionmaking 
processes;
    (4) Ensure that regulations, procedures and other issuances making 
or amending program policy are reviewed for consistency with the 
requirements of this part;

[[Page 104]]

    (5) Designate a single point of contact for matters pertaining to 
this part;
    (6) Provide applicants for FEMA assistance with technical assistance 
regarding FEMA's environmental review process.
    (d) The Office of General Counsel of FEMA shall:
    (1) Provide advice and assistance concerning the requirements of 
this part;
    (2) Review all proposed changes or additions to the list of 
categorical exclusions;
    (3) Review all findings of no significant impact; and
    (4) Review all proposed draft and final environmental impact 
statements.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.6  Making or amending policy.

    For all regulations, procedures, or other issuances making or 
amending policy, the head of the FEMA office or administration 
establishing such policy shall be responsible for application of this 
part to that action. This does not apply to actions categorically 
excluded. For all policy-making actions not categorically excluded, the 
head of the office or administration shall comply with the requirements 
of this part. Thus, for such actions, the office or administration head 
shall assume the responsibilities that a Regional Director assumes for a 
FEMA action in his/her respective region. For such policy-making actions 
taken by the Director of FEMA, the Environmental Officer shall assume 
the responsibilities that a Regional Director assumes for a FEMA action 
in his/her respective region.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.7  Planning.

    (a) Early planning. The Regional Director shall integrate the NEPA 
process with other planning at the earliest possible time to ensure that 
planning decisions reflect environmental values, to avoid delays later 
in the process, and to head off potential conflicts.
    (b) Lead agency. To determine the lead agency for policy-making in 
which more than one FEMA office or administration is involved or any 
action in which another Federal agency is involved, FEMA offices and 
administrations shall apply criteria defined in Sec. 1501.5 of the CEQ 
regulation. If there is disagreement, the FEMA offices and/or 
administrations shall forward a request for lead agency determination to 
the Environmental Officer;
    (1) The Environmental Officer will determine lead agency 
responsibility among FEMA offices and administration.
    (2) In those cases involving a FEMA office or administration and 
another Federal agency, the Environmental Officer will attempt to 
resolve the differences. If unsuccessful, the Environmental Officer will 
file the request with the Council on Environmental Quality for 
determination.
    (c) Technical assistance to applicants. (1) Section 1501.2(d) of the 
CEQ regulations requires agencies to provide for early involvement in 
actions which, while planned by private applicants or other non-Federal 
entities, require some form of Federal approval. To implement the 
requirements of Sec. 1501.2(d),
    (i) The heads of the FEMA offices and administration shall prepare 
where practicable, generic guidelines describing the scope and level of 
environmental information required from applicants as a basis for 
evaluating their proposed actions, and make these guidelines available 
upon request.
    (ii) The Regional Director shall provide such guidance on a project-
by-project basis to applicants seeking assistance from FEMA.
    (iii) Upon receipt of an application for agency approval, or 
notification that an application will be filed, the Regional Director 
shall consult as required with other appropriate parties to initiate and 
coordinate the necessary environmental analyses.
    (2) To facilitate compliance with the requirements of paragraph (a) 
of this section, applicants and other non-Federal entities are expected 
to:
    (i) Contact the Regional Director as early as possible in the 
planning process for guidance on the scope and level of environmental 
information required to be submitted in support of their application;

[[Page 105]]

    (ii) Conduct any studies which are deemed necessary and appropriate 
by FEMA to determine the impact of the proposed action on the human 
environment;
    (iii) Consult with appropriate Federal, regional, State, and local 
agencies and other potentially interested parties during preliminary 
planning stages to ensure that all environmental factors are identified;
    (iv) Submit applications for all Federal, regional, State, and local 
approvals as early as possible in the planning process;
    (v) Notify the Regional Director as early as possible of all other 
Federal, regional, State, local, and Indian tribe actions required for 
project completion so that FEMA may coordinate all Federal environmental 
reviews; and
    (vi) Notify the Regional Director of all known parties potentially 
affected by or interested in the proposed action.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.8  Determination of requirement for environmental review.

    The first step in applying the NEPA process is to determine whether 
to prepare an environmental assessment or an environmental impact 
statement. Early determination will help ensure that necessary 
environmental documentation is prepared and integrated into the 
decision-making process. Environmental impact statements will be 
prepared for all major Agency actions (see 40 CFR 1508.18) significantly 
(see 40 CFR 1508.27) affecting the quality of the human environment.
    (a) In determining whether to prepare an environmental impact 
statement (EIS) the Regional Director will first determine whether the 
proposal is one which:
    (1) Normally requires an environmental impact statement; or
    (2) Normally does not require either an environmental impact 
statement or an environmental assessment (categorical exclusion).
    (b) Actions that normally require an EIS. (1) In some cases, it will 
be readily apparent that a proposed action will have significant impact 
on the environment. In that event, the Regional Director will, pursuant 
to Sec. 10.9(g) of this part, submit the notice of preparation of an 
environmental impact statement to the Environmental Officer.
    (2) To assist in determining those actions that normally do require 
an environmental impact statement, the following criteria apply:
    (i) If an action will result in an extensive change in land use or 
the commitment of a large amount of land;
    (ii) If an action will result in a land use change which is 
incompatible with the existing or planned land use of the surrounding 
area;
    (iii) If many people will be affected;
    (iv) If the environmental impact of the project is likely to be 
controversial;
    (v) If an action will affect, in large measure, wildlife populations 
and their habitats, important natural resources, floodplains, wetlands, 
estuaries, beaches, dunes, unstable soils, steep slopes, aquifer 
recharge areas, or delicate or rare ecosystems, including endangered 
species;
    (vi) If an action will result in a major adverse impact upon air or 
water quality;
    (vii) If an action will adversely affect a property listed on the 
National Register of Historic Places or eligible for listing on the 
Register if, after consultation with the Advisory Council on Historic 
Preservation an environmental assessment is not deemed sufficient;
    (viii) If an action is one of several actions underway or planned 
for an area and the cumulative impact of these projects is considered 
significant in terms of the above criteria;
    (ix) If an action holds potential for threat or hazard to the 
public; or
    (x) If an action is similar to previous actions determined to 
require an environmental impact statement.
    (3) In any case involving an action that normally does require an 
environmental impact statement, the Regional Director may prepare an 
environmental assessment to determine if an environmental impact 
statement is required.
    (c) Statutory exclusions. The following actions are statutorily 
excluded from NEPA and the preparation of environmental impact 
statements and environmental assessments by section 316 of

[[Page 106]]

the Robert T. Stafford Disaster Relief and Emergency Assistance Act 
(Stafford Act), as amended, 42 U.S.C. 5159;
    (1) Action taken or assistance provided under sections 402, 403, 
407, or 502 of the Stafford Act; and
    (2) Action taken or assistance provided under section 406 of the 
Stafford Act that has the effect of restoring facilities substantially 
as they existed before a major disaster or emergency.
    (d) Categorical Exclusions (CATEXs). CEQ regulations at 40 CFR 
1508.4 provide for the categorical exclusion of actions that do not 
individually or cumulatively have a significant impact on the human 
environment and for which, therefore, neither an environmental 
assessment nor an environmental impact statement is required. Full 
implementation of this concept will help FEMA avoid unnecessary or 
duplicate effort and concentrate resources on significant environmental 
issues.
    (1) Criteria. The criteria used for determination of those 
categories of actions that normally do not require either an 
environmental impact statement or an environmental assessment include:
    (i) Minimal or no effect on environmental quality;
    (ii) No significant change to existing environmental conditions; and
    (iii) No significant cumulative environmental impact.
    (2) List of exclusion categories. FEMA has determined that the 
following categories of actions have no significant effect on the human 
environment and are, therefore, categorically excluded from the 
preparation of environmental impact statements and environmental 
assessments except where extraordinary circumstances as defined in 
paragraph (d)(5) of this section exist. If the action is of an emergency 
nature as described in Sec. 316 of the Stafford Act (42 U.S.C. 5159), it 
is statutorily excluded and is noted with [SE].
    (i) Administrative actions such as personnel actions, travel, 
procurement of supplies, etc., in support of normal day-to-day 
activities and disaster related activities;
    (ii) Preparation, revision, and adoption of regulations, directives, 
manuals, and other guidance documents related to actions that qualify 
for categorical exclusions;
    (iii) Studies that involve no commitment of resources other than 
manpower and associated funding;
    (iv) Inspection and monitoring activities, granting of variances, 
and actions to enforce Federal, state, or local codes, standards or 
regulations;
    (v) Training activities and both training and operational exercises 
utilizing existing facilities in accordance with established procedures 
and land use designations;
    (vi) Procurement of goods and services for support of day-to-day and 
emergency operational activities, and the temporary storage of goods 
other than hazardous materials, so long as storage occurs on previously 
disturbed land or in existing facilities;
    (vii) The acquisition of properties and the associated demolition/
removal [see paragraph (d)(2)(xii) of this section] or relocation of 
structures [see paragraph (d)(2)(xiii) of this section] under any 
applicable authority when the acquisition is from a willing seller, the 
buyer coordinated acquisition planning with affected authorities, and 
the acquired property will be dedicated in perpetuity to uses that are 
compatible with open space, recreational, or wetland practices.
    (viii) Acquisition or lease of existing facilities where planned 
uses conform to past use or local land use requirements;
    (ix) Acquisition, installation, or operation of utility and 
communication systems that use existing distribution systems or 
facilities, or currently used infrastructure rights-of-way;
    (x) Routine maintenance, repair, and grounds-keeping activities at 
FEMA facilities;
    (xi) Planting of indigenous vegetation;
    (xii) Demolition of structures and other improvements or disposal of 
uncontaminated structures and other improvements to permitted off-site 
locations, or both;
    (xiii) Physical relocation of individual structures where FEMA has 
no involvement in the relocation site selection or development;
    (xiv) Granting of community-wide exceptions for floodproofed 
residential

[[Page 107]]

basements meeting the requirements of 44 CFR 60.6(c) under the National 
Flood Insurance Program;
    (xv) Repair, reconstruction, restoration, elevation, retrofitting, 
upgrading to current codes and standards, or replacement of any facility 
in a manner that substantially conforms to the preexisting design, 
function, and location; [SE, in part]
    (xvi) Improvements to existing facilities and the construction of 
small scale hazard mitigation measures in existing developed areas with 
substantially completed infrastructure, when the immediate project area 
has already been disturbed, and when those actions do not alter basic 
functions, do not exceed capacity of other system components, or modify 
intended land use; provided the operation of the completed project will 
not, of itself, have an adverse effect on the quality of the human 
environment;
    (xvii) Actions conducted within enclosed facilities where all 
airborne emissions, waterborne effluent, external radiation levels, 
outdoor noise, and solid and bulk waste disposal practices comply with 
existing Federal, state, and local laws and regulations;
    (xviii) The following planning and administrative activities in 
support of emergency and disaster response and recovery:
    (A) Activation of the Emergency Support Team and convening of the 
Catastrophic Disaster Response Group at FEMA headquarters;
    (B) Activation of the Regional Operations Center and deployment of 
the Emergency Response Team, in whole or in part;
    (C) Deployment of Urban Search and Rescue teams;
    (D) Situation Assessment including ground and aerial reconnaissance;
    (E) Information and data gathering and reporting efforts in support 
of emergency and disaster response and recovery and hazard mitigation; 
and
    (xix) The following emergency and disaster response, recovery and 
hazard mitigation activities under the Stafford Act:
    (A) General Federal Assistance (Sec. 402); [SE]
    (B) Essential Assistance (Sec. 403); [SE]
    (C) Debris Removal (Sec. 407) [SE]
    (D) Temporary Housing (Sec. 408), except locating multiple mobile 
homes or other readily fabricated dwellings on sites, other than private 
residences, not previously used for such purposes;
    (E) Unemployment Assistance (Sec. 410);
    (F) Individual and Family Grant Programs (Sec. 411), except for 
grants that will be used for restoring, repairing or building private 
bridges, or purchasing mobile homes or other readily fabricated 
dwellings;
    (G) Food Coupons and Distribution (Sec. 412);
    (H) Food Commodities (Sec. 413);
    (I) Legal Services (Sec. 415);
    (J) Crisis Counseling Assistance and Training (Sec. 416);
    (K) Community Disaster Loans (Sec. 417);
    (L) Emergency Communications (Sec. 418);
    (M) Emergency Public Transportation (Sec. 419);
    (N) Fire Suppression Grants (Sec. 420); and
    (O) Federal Emergency Assistance (Sec. 502) [SE].
    (3) Extraordinary circumstances. If extraordinary circumstances 
exist within an area affected by an action, such that an action that is 
categorically excluded from NEPA compliance may have a significant 
adverse environmental impact, an environmental assessment shall be 
prepared. Extraordinary circumstances that may have a significant 
environmental impact include:
    (i) Greater scope or size than normally experienced for a particular 
category of action;
    (ii) Actions with a high level of public controversy;
    (iii) Potential for degradation, even though slight, of already 
existing poor environmental conditions;
    (iv) Employment of unproven technology with potential adverse 
effects or actions involving unique or unknown environmental risks;
    (v) Presence of endangered or threatened species or their critical 
habitat, or archaeological, cultural, historical or other protected 
resources;
    (vi) Presence of hazardous or toxic substances at levels which 
exceed Federal, state or local regulations or

[[Page 108]]

standards requiring action or attention;
    (vii) Actions with the potential to affect special status areas 
adversely or other critical resources such as wetlands, coastal zones, 
wildlife refuge and wilderness areas, wild and scenic rivers, sole or 
principal drinking water aquifers;
    (viii) Potential for adverse effects on health or safety; and
    (ix) Potential to violate a Federal, State, local or tribal law or 
requirement imposed for the protection of the environment.
    (x) Potential for significant cumulative impact when the proposed 
action is combined with other past, present and reasonably foreseeable 
future actions, even though the impacts of the proposed action may not 
be significant by themselves.
    (4) Documentation. The Regional Director will prepare and maintain 
an administrative record of each proposal that is determined to be 
categorically excluded from the preparation of an environmental impact 
statement or an environmental assessment.
    (5) Revocation. The Regional Director shall revoke a determination 
of categorical exclusion and shall require a full environmental review 
if, subsequent to the granting an exclusion, the Regional Director 
determines that due to changes in the proposed action or in light of new 
findings, the action no longer meets the requirements for a categorical 
exclusion.
    (6) Changes to the list of exclusion categories. (i) The FEMA list 
of exclusion categories will be continually reviewed and refined as 
additional categories are identified and experience is gained in the 
categorical exclusion process. An office, directorate, or administration 
of FEMA may, at any time, recommend additions or changes to the FEMA 
list of exclusion categories.
    (ii) Offices, directorates, and administrations of FEMA are 
encouraged to develop additional categories of exclusions necessary to 
meet their unique operational and mission requirements.
    (iii) If an office, directorate, or administration of FEMA proposes 
to change or add to the list of exclusion categories, it shall first:
    (A) Obtain the approval of the Environmental Officer and the Office 
of the General Counsel; and
    (B) Publish notice of such proposed change or addition in the 
Federal Register at least 60 days before the effective date of such 
change or addition.
    (e) Actions that normally require an environmental assessment. When 
a proposal is not one that normally requires an environmental impact 
statement and does not qualify as a categorical exclusion, the Regional 
Director shall prepare an environmental assessment.
    (f) Documentation. The Regional Director will prepare and maintain 
an administrative record of each proposal that is determined to be 
categorically excluded from the preparation of an environmental impact 
statement or an environmental assessment.
    (g) Actions that normally require an environmental assessment. When 
a proposal is not one that normally requires an environmental impact 
statement and does not qualify as a categorical exclusion, the Regional 
Director shall prepare an environmental assessment.

[45 FR 41142, June 18, 1980, as amended at 46 FR 2049, Jan. 8, 1981; 46 
FR 54346, Nov. 3, 1981; 47 FR 13149, Mar. 29, 1982; 52 FR 5285, Feb. 20, 
1987; 59 FR 954, Jan. 7, 1994; 61 FR 4230, Feb. 5, 1996; 61 FR 10688, 
Mar. 15, 1996]



Sec. 10.9  Preparation of environmental assessments.

    (a) When to prepare. The Regional Director shall begin preparation 
of an environmental assessment as early as possible after the 
determination that an assessment is required. The Regional Director may 
prepare an environmental assessment at any time to assist planning and 
decision-making.
    (b) Content and format. The environmental assessment is a concise 
public document to determine whether to prepare an environmental impact 
statement, aiding in compliance with NEPA when no EIS is necessary, and 
facilitating preparation of a statement when one is necessary. 
Preparation of an environmental assessment generally will not require 
extensive research or lengthy documentation. The environmental 
assessment shall contain brief discussion of the following:
    (1) Purpose and need for the proposed action.

[[Page 109]]

    (2) Description of the proposed action.
    (3) Alternatives considered.
    (4) Environmental impact of the proposed action and alternatives.
    (5) Listing of agencies and persons consulted.
    (6) Conclusion of whether to prepare an environmental impact 
statement.
    (c) Public participation. The Regional Director shall involve 
environmental agencies, applicants, and the public, to the extent 
practicable, in preparing environmental assessments. In determining ``to 
the extent practicable,'' the Regional Director shall consider:
    (1) Magnitude of the proposal;
    (2) Likelihood of public interest;
    (3) Need to act quickly;
    (4) Likelihood of meaningful public comment;
    (5) National security classification issues;
    (6) Need for permits; and
    (7) Statutory authority of environmental agency regarding the 
proposal.
    (d) When to prepare an EIS. The Regional Director shall prepare an 
environmental impact statement for all major Agency actions 
significantly affecting the quality of the human environment. The test 
of what is a ``significant'' enough impact to require an EIS is found in 
the CEQ regulations at 40 CFR 1508.27.
    (e) Finding of No Significant Impact. If the Regional Director 
determines on the basis of the environmental assessment not to prepare 
an environmental impact statement, the Regional Director shall prepare a 
finding of no significant impact in accordance with 40 CFR 1501.4(e) of 
the CEQ regulations. The assessment and the finding shall be submitted 
to the Environmental Officer and the Office of General Counsel (OGC) for 
approval. If Environmental Officer and OGC approval is obtained, the 
Regional Director shall then make the finding of no significant impact 
available to the public as specified in Sec. 1506.6 of the CEQ 
regulations. A finding of no significant impact is not required when the 
decision not to prepare an environmental impact statement is based on a 
categorical exclusion.
    (f) Environmental Officer or OGC Disallowance. If the Environmental 
Officer or OGC disagrees with the finding of no significant impact, the 
Regional Director shall prepare an environmental impact statement. Prior 
to preparation of an EIS, the Regional Director shall forward a notice 
of intent to prepare the EIS to the Environmental Officer who shall 
publish such notice in the Federal Register.
    (g) EIS determination of Regional Director. The Regional Director 
may decide on his/her own to prepare an environmental impact statement. 
In such case, the Regional Director shall forward a notice of intent to 
prepare the EIS to the Environmental Officer who shall publish such 
notice in the Federal Register. The notice of intent shall be published 
before initiation of the scoping process.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.10  Preparation of environmental impact statements.

    (a) Scoping. After determination that an environmental impact 
statement will be prepared and publication of the notice of intent, the 
Regional Director will initiate the scoping process in accordance with 
Sec. 1501.7 of the CEQ regulations.
    (b) Preparation. Based on the scoping process, the Regional Director 
will begin preparation of the environmental impact statement. Detailed 
procedures for preparation of the environmental impact statement are 
provided in part 1502 of the CEQ regulations.
    (c) Supplemental Environmental Impact Statements. The Regional 
Director may at any time supplement a draft or final environmental 
impact statement. The Regional Director shall prepare a supplement to 
either the draft or final environmental impact statement when required 
under the criteria set forth in Sec. 1502.9(2). The Regional Director 
will prepare, circulate, and file a supplement to a statement in the 
same fashion (exclusive of scoping) as a draft or final statement and 
will introduce the supplement into their formal administrative record.
    (d) Circulation of Environmental Impact Statements. The Regional 
Director shall circulate draft and final environmental impact statements 
as prescribed in Sec. 1502.19 of CEQ regulations. Prior to signing off 
on a draft or final impact

[[Page 110]]

statement, the Regional Director shall obtain the approval of the 
Environmental Officer and OGC.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.11  Environmental information.

    Interested persons may contact the Environmental Officer or the 
Regional Director for information regarding FEMA's compliance with NEPA.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.12  Pre-implementation actions.

    (a) Decision-making. The Regional Director shall ensure that 
decisions are made in accordance with the policies and procedures of the 
Act and that the NEPA process is integrated into the decision-making 
process. Because of the diversity of FEMA, it is not feasible to 
describe in this part the decision-making process for each of the 
various FEMA programs. Proposals and actions may be initiated at any 
level. Similarly, review and approval authority may be exercised at 
various levels depending on the nature of the action, available funding, 
and statutory authority. FEMA offices and administrations shall provide 
further guidance, commensurate with their programs and organization, for 
integration of environmental considerations into the decision-making 
process. The Regional Director shall:
    (1) Consider all relevant environmental documents in evaluating 
proposals for Agency action;
    (2) Make all relevant environmental documents, comments, and 
responses part of the record in formal rulemaking or adjudicatory 
proceedings;
    (3) Ensure that all relevant environmental documents, comments and 
responses accompany the proposal through existing Agency review 
processes;
    (4) Consider only those alternatives encompassed by the range of 
alternatives discussed in the relevant environmental documents when 
evaluating proposals for Agency action;
    (5) Where an EIS has been prepared, consider the specific 
alternatives analyzed in the EIS when evaluating the proposal which is 
the subject of the EIS.
    (b) Record of decision. In those cases requiring environmental 
impact statements, the Regional Director at the time of his/her 
decision, or if appropriate, his/her recommendation to Congress, shall 
prepare a concise public record of that decision. The record of decision 
is not intended to be an extensive, detailed document for the purpose of 
justifying the decision. Rather it is a concise document that sets forth 
the decision and describes the alternatives and relevant factors 
considered as specified in 40 CFR 1505.2. The record of decision will 
normally be less than three pages in length.
    (c) Mitigation. Throughout the NEPA process, the Regional Director 
shall consider mitigating measures to avoid or minimize environmental 
harm and, in particular, harm to or within flood plains and wetlands. 
Mitigation measures or programs will be identified in the environmental 
impact statement and made available to decision-makers. Mitigation and 
other conditions established in the environmental impact statement or 
during its review and committed as part of the decision shall be 
implemented by the Regional Director.
    (d) Monitoring. If a Regional Director determines that monitoring is 
applicable for established mitigation, a monitoring program will be 
adopted to assure the mitigation measures are accomplished. The Regional 
Director shall provide monitoring information, upon request, as 
specified in 40 CFR 1505.3. This does not, however, include standing or 
blanket requests for periodic reporting.



Sec. 10.13  Emergencies.

    In the event of an emergency, the Regional Director may be required 
to take immediate action with significant environmental impact. The 
Regional Director shall notify the Environmental Officer of the 
emergency action at the earliest possible time so that the Environmental 
Officer may consult with the Council on Environmental Quality. In no 
event shall any Regional Director delay an emergency action necessary to 
the preservation of human life for the purpose of complying with

[[Page 111]]

the provision of this directive or the CEQ regulations.

[45 FR 41142, June 18, 1980, as amended at 47 FR 13149, Mar. 29, 1982]



Sec. 10.14  Flood plains and wetlands.

    For any action taken by FEMA in a flood plain or wetland, the 
provisions of this part are supplemental to, and not instead of, the 
provisions of the FEMA regulation implementing Executive Order 11988, 
Flood Plain Management, and Executive Order 11990, Protection of 
Wetlands (44 CFR part 9).



PART 11--CLAIMS--Table of Contents




                           Subpart A--General

Sec.
11.1  General collection standards.
11.2  Delegations of authority.

     Subpart B--Administrative Claims Under Federal Tort Claims Act

11.10  Scope of regulation.
11.11  Administrative claim; when presented; appropriate FEMA office.
11.12  Administrative claim; who may file.
11.13  Investigations.
11.14  Administrative claim; evidence and information to be submitted.
11.15  Authority to adjust, determine, compromise and settle.
11.16  Limitations on authority.
11.17  Referral to Department of Justice.
11.18  Final denial of claim.
11.19  Action on approved claim.

    Subpart C--Collection of Debts by the Government Under the Debt 
                         Collection Act of 1982

11.30  Scope of regulations.
11.31  Adoption of joint standards.
11.32  Subdivision and joining of debts.
11.33  Authority of offices to attempt collection of debts.
11.34  Referral of debts to the Chief Financial Officer, Federal 
          Emergency Management Agency.
11.35  Authority of offices to compromise debts or suspend or terminate 
          collection action.
11.36  Debt collection files.
11.37  [Reserved]
11.38  Annual reports to the Director, Office of Management and Budget, 
          and the Secretary of the Treasury.
11.40  Records retention.
11.41  Suspension or revocation of eligibility.
11.42  Demand for payment of debts.
11.43  Collection from non-Government entities by administrative offset.
11.44  Collection of debts from Federal agencies or States or units of 
          general local government by common law offset.
11.45  Collection by salary offset.
11.46  Liquidation of collateral.
11.47  Collection in installments.
11.48  Interest and penalties.
11.49  Omission not a defense.
11.50  Standards for compromise of debts.
11.51  Standards for suspension or termination of collection.
11.52  Referral of delinquent debtors to consumer reporting agencies.
11.53  Securing debtor addresses from the Department of Treasury.
11.54  Contracts with debt collection agencies.
11.55  Referral to GAO or Justice Department.
11.56  Analysis of costs.
11.57  Automation.
11.58  Prevention of overpayments, delinquencies, and defaults.
11.59  Office of General Counsel.
11.60  Sale of debts due the United States arising under programs 
          administered by the Agency.
11.61  Referral of delinquent debts to Internal Revenue Service.
11.62  Administrative charges incurred in referrals for income tax 
          refund offset.
11.63  Notice to debtor before offset.
11.64  Review within Federal Emergency Management Agency.
11.65  Stay of offset.

                 Subpart D--Personnel Claims Regulations

11.70  Scope and purpose.
11.71  Claimants.
11.72  Time limitations.
11.73  Allowable claims.
11.74  Claims not allowed.
11.75  Claims involving carriers and insurers.
11.76  Claims procedures.
11.77  Settlement of claims.
11.78  Computation of amount of award.
11.79  Attorney's fees.

    Authority: 28 U.S.C. 2672; 28 CFR 14.11; 5 U.S.C. 301; 31 U.S.C. 
3701 et seq.; Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 
1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 Comp., p. 376.

    Source: 45 FR 15930, Mar. 12, 1980, unless otherwise noted.



                           Subpart A--General



Sec. 11.1  General collection standards.

    The general standards and procedures governing the collection, 
compromise, termination and referral to the Department of Justice of 
claims for money

[[Page 112]]

and property that are prescribed in the regulations issued jointly by 
the General Accounting Office and the Department of Justice pursuant to 
the Federal Claims Collection Act of 1966 (4 CFR part 101 et seq.), 
apply to the administrative claim collection activities of the Federal 
Emergency Management Agency (FEMA).



Sec. 11.2  Delegations of authority.

    Any and all claims that arise under subchapter III of chapter 83, 
chapter 87 and chapter 88 of title 5, the United States Code, the 
Retired Federal Employees Health Benefits Act (74 Stat. 849), the Panama 
Canal Construction Annuity Act (58 Stat. 257), and the Lighthouse 
Service Widow's Annuity Act (64 Stat. 465) shall be referred to the 
Director of the Bureau of Retirement and Insurance, Office of Personnel 
Management, for handling. The General Counsel, FEMA shall act on all 
other claims against FEMA for money and property.



     Subpart B--Administrative Claims Under Federal Tort Claims Act



Sec. 11.10  Scope of regulation.

    This regulation applies to claims asserted under the Federal Tort 
Claims Act against the Federal Emergency Management Agency (FEMA). It 
does not include any contractor with FEMA.



Sec. 11.11  Administrative claim; when presented; appropriate FEMA office.

    (a) For the purpose of this part, and the provisions of the Federal 
Tort Claims Act a claim is deemed to have been presented when FEMA 
receives, at a place designated in paragraph (b) or (c) of this section, 
an executed ``Claim for Damage or Injury,'' Standard Form 95, or other 
written notification of an incident, accompanied by a claim for money 
damages in a sum certain for injury to or loss of property, for personal 
injury, or for death alleged to have occurred by reason of the incident. 
A claim which should have been presented to FEMA, but which was 
mistakenly addressed to or filed with another Federal agency, is deemed 
to be presented to FEMA as of the date that the claim is received by 
FEMA. If a claim is mistakenly addressed to or filed with FEMA, the 
claim shall forthwith be transferred to the appropriate Federal Agency, 
if ascertainable, or returned to the claimant.
    (b) Except as provided in paragraph (c) of this section, a claimant 
shall mail or deliver his or her claim to the Office of General Counsel, 
Federal Emergency Management Agency, Washington, DC, 20472.
    (c) When a claim is for $200 or less, does not involve a personal 
injury, and involves a FEMA regional employee, the claimant shall mail 
or deliver the claim to the Director of the FEMA Regional Office in 
which is employed the FEMA employee whose negligence or wrongful act or 
omission is alleged to have caused the loss or injury complained of. The 
addresses of the Regional Offices of FEMA are set out in part 2 of this 
chapter.
    (d) A claim presented in compliance with paragraph (a) of this 
section may be amended by the claimant at any time prior to final FEMA 
action or prior to the exercise of the claimant's option under 28 U.S.C. 
2675(a). Amendments shall be submitted in writing and signed by the 
claimant or his or her duly authorized agent or legal representative. 
Upon the timely filing of an amendment to a pending claim, FEMA shall 
have six months in which to make a final disposition of the claim as 
amended and the claimant's option under 28 U.S.C. 2675(a) shall not 
accrue until six months after the filing of an amendment.

[45 FR 15930, Mar. 12, 1980, as amended at 48 FR 6711, Feb. 15, 1983; 49 
FR 33879, Aug. 27, 1984]



Sec. 11.12  Administrative claim; who may file.

    (a) A claim for injury to or loss of property may be presented by 
the owner of the property interest which is the subject of the claim, 
his or her authorized agent, or legal representative.
    (b) A claim for personal injury may be presented by the injured 
person or, his or her authorized agent or legal representative.
    (c) A claim based on death may be presented by the executor or 
administrator of the decedent's estate or by

[[Page 113]]

any other person legally entitled to assert such a claim under 
applicable State law.
    (d) A claim for loss wholly compensated by an insurer with the 
rights of a subrogee may be presented by the insurer or the insured 
individually, as their respective interests appear, or jointly. When an 
insurer presents a claim asserting the rights of a subrogee, he or she 
shall present with the claim appropriate evidence that he or she has the 
rights of a subrogee.
    (e) A claim presented by an agent or legal representative shall be 
presented in the name of the claimant, be signed by the agent or legal 
representative, show the title of legal capacity of the person signing, 
and be accompanied by evidence of his or her authority to present a 
claim on behalf of the claimant as agent, executor, administrator, 
parent, guardian, or other representative.



Sec. 11.13  Investigations.

    FEMA may investigate, or may request any other Federal agency to 
investigate, a claim filed under this part.



Sec. 11.14  Administrative claim; evidence and information to be submitted.

    (a) Death. In support of a claim based on death the claimant may be 
required to submit the following evidence or information:
    (1) An authenticated death certificate or other competent evidence 
showing cause of death, date of death, and age of the decedent.
    (2) Decedent's employment or occupation at time of death, including 
his or her monthly or yearly salary or earnings (if any), and the 
duration of his or her last employment or occupation.
    (3) Full names, addresses, birth dates, kinship, and marital status 
of the decedent's survivors, including identification of those survivors 
who were dependent for support on the decedent at the time of his or her 
death.
    (4) Degree of support afforded by the decedent to each survivor 
dependent on him or her for support at the time of death.
    (5) Decedent's general physical and mental condition before death.
    (6) Itemized bills or medical and burial expenses incurred by reason 
of the incident causing death, or itemized receipts of payment for such 
expenses.
    (7) If damages for pain and suffering before death are claimed, a 
physician's detailed statement specifying the injuries suffered, 
duration of pain and suffering, any drugs administered for pain, and the 
decedent's physical condition in the interval between injury and death.
    (8) Any other evidence or information which may have a bearing on 
either the responsibility of the United States for the death or the 
amount of damages claimed.
    (b) Personal injury. In support of a claim for personal injury, 
including pain and suffering, the claimant may be required to submit the 
following evidence or information:
    (1) A written report by his or her attending physician or dentist 
setting forth the nature and extent of the injury, nature and extent of 
treatment, any degree of temporary or permanent disability, the 
prognosis, period of hospitalization, and any diminished earning 
capacity. In addition, the claimant may be required to submit to a 
physical or mental examination by a physician employed by FEMA or 
another Federal agency. FEMA shall make available to the claimant a copy 
of the report of the examining physician on written request by the 
claimant, if he or she has, on request, furnished the report referred to 
in the first sentence of this subparagraph and has made or agrees to 
make available to FEMA any other physician's reports previously or 
thereafter made of the physical or mental condition which is the subject 
matter of the claim.
    (2) Itemized bills for medical, dental, and hospital expenses 
incurred, or itemized receipts of payment of such expenses.
    (3) If the prognosis reveals the necessity for future treatment, a 
statement of expected expenses for such treatment.
    (4) If a claim is made for loss of time from employment, a written 
statement from the employer showing actual time lost from employment, 
whether he or she is a full- or part-time employee, and wages or salary 
actually lost.

[[Page 114]]

    (5) If a claim is made for loss of income and the claimant is self-
employed, documentary evidence showing the amount of earnings actually 
lost.
    (6) Any other evidence or information which may have a bearing on 
either the responsibility of the United States for the personal injury 
or the damages claimed.
    (c) Property damage. In support of a claim for injury to or loss of 
property, real or personal, the claimant may be required to submit the 
following evidence or information:
    (1) Proof of ownership of the property interest which is the subject 
of the claim.
    (2) A detailed statement of the amount claimed with respect to each 
item of property.
    (3) An itemized receipt of payment for necessary repairs or itemized 
written estimates of the cost of such repairs.
    (4) A statement listing date of purchase, purchase price, and 
salvage value, where repair is not economical.
    (5) Any other evidence or information which may have a bearing on 
either the responsibility of the United States for the injury to or loss 
of property or the damages claimed.



Sec. 11.15  Authority to adjust, determine, compromise and settle.

    (a) The General Counsel of FEMA, or a designee of the General 
Counsel, is delegated authority to consider, ascertain, adjust, 
determine, compromise, and settle claims under the provisions of section 
2672 of title 28, United States Code, and this part.
    (b) Notwithstanding the delegation of authority in paragraph (a) of 
this section, a Regional Director is delegated authority to be exercised 
in his or her discretion, to consider, ascertain, adjust, determine, 
compromise, and settle under the provisions of section 2672 of title 28, 
United States Code, and this part, any claim for $200 or less which is 
based on alleged negligence or wrongful act or omission of an employee 
of the appropriate Region, except when:
    (1) There are personal injuries to either Government personnel or 
individuals not employed by the Government; or
    (2) All damage to Government property or to property being used by 
FEMA, or both, is more than $200, or all damage to non-Government 
property being used by individuals not employed by the Government is 
more than $200.

[45 FR 15930, Mar. 12, 1980, as amended at 48 FR 6711, Feb. 15, 1983]



Sec. 11.16  Limitations on authority.

    (a) An award, compromise, or settlement of a claim under this part 
in excess of $25,000 may be effected only with the advance written 
approval of the Attorney General or his or her designee. For the purpose 
of this paragraph, a principal claim and any derivative or subrogated 
claim shall be treated as a single claim.
    (b) An administrative claim may be adjusted, determined, 
compromised, or settled under this part only after consultation with the 
Department of Justice, when, in the opinion of the General Counsel of 
FEMA or his or her designee:
    (1) A new precedent or a new point of law is involved; or
    (2) A question of policy is or may be involved; or
    (3) The United States is or may be entitled to indemnity or 
contribution from a third party and FEMA is unable to adjust the third 
party claim; or
    (4) The compromise of a particular claim, as a practical matter, 
will or may control the disposition of a related claim in which the 
amount to be paid may exceed $25,000.
    (c) An administrative claim may be adjusted, determined, compromised 
or settled under this part only after consultation with the Department 
of Justice when FEMA is informed or is otherwise aware that the United 
States or an employee, agent or cost-type contractor of the United 
States is involved in litigation based on a claim arising out of the 
same incident or transaction.



Sec. 11.17  Referral to Department of Justice.

    When Department of Justice approval or consultation is required 
under Sec. 11.16, the referral or request shall be transmitted to the 
Department

[[Page 115]]

of Justice by the General Counsel or his or her designee.



Sec. 11.18  Final denial of claim.

    (a) Final denial of an administrative claim under this part shall be 
in writing and sent to the claimant, his or her attorney, or legal 
representative by certified or registered mail. The notification of 
final denial may include a statement of the reasons for the denial and 
shall include a statement that, if the claimant is dissatisfied with the 
FEMA action, he or she may file suit in an appropriate U.S. District 
Court not later than 6 months after the date of mailing of the 
notification.
    (b) Prior to the commencement of suit and prior to the expiration of 
the 6-month period provided in 28 U.S.C. 2401(b), a claimant, his or her 
duly authorized agent, or legal representative, may file a written 
request with FEMA for reconsideration of a final denial of a claim under 
paragraph (a) of this section. Upon the timely filing of a request for 
reconsideration the FEMA shall have 6 months from the date of filing in 
which to make a final FEMA disposition of the claim and the claimant's 
option under 28 U.S.C. 2675(a) shall not accrue until 6 months after the 
filing of a request for reconsideration. Final FEMA action on a request 
for reconsideration shall be effected in accordance with the provisions 
of paragraph (a) of this section.



Sec. 11.19  Action on approved claim.

    (a) Payment of a claim approved under this part is contingent on 
claimant's execution of (1) a ``Claim for Damage or Injury,'' Standard 
Form 95, or a claims settlement agreement, and (2) a ``Voucher for 
Payment,'' Standard Form 1145, as appropriate. When a claimant is 
represented by an attorney, the voucher for payment shall designate both 
the claimant and his or her attorney as payees, and the check shall be 
delivered to the attorney, whose address shall appear on the voucher.
    (b) Acceptance by the claimant, his or her agenct, or legal 
representative, of an award, compromise, or settlement made under 
section 2672 or 2677 of title 28, United States Code, is final and 
conclusive on the claimant, his or her agent or legal representative, 
and any other person on whose behalf or for whose benefit the claim has 
been presented, and constitutes a complete release of any claim against 
the United States and against any employee of the Government whose act 
or omission gave rise to the claim, by reason of the same subject 
matter.



    Subpart C--Collection of Debts by the Government Under the Debt 
                         Collection Act of 1982

    Authority: 31 U.S.C. 3711 et seq.

    Source: 49 FR 38267, Sept. 28, 1984, unless otherwise noted.



Sec. 11.30  Scope of regulations.

    (a) Scope. This regulation implements policies used by FEMA to 
collect debts under the Debt Collection Act of 1982, as amended, 31 
U.S.C. 3701 et seq. As amended, this Act:
    (1) Requires the Director or designee to attempt collection of all 
debts owed to the United States for money or property arising out of 
activities of the Agency; and
    (2) Authorizes the Director or his designee, for debts not exceeding 
$100,000 or such higher limit prescribed by the Attorney General of the 
United States, under the provisions of 31 U.S.C. 3711(a)(2), exclusive 
of interest, penalty, and administrative charges, to compromise such 
debts or terminate collection action where it appears that no person is 
liable on such debt or has the present or prospective financial ability 
to pay a significant sum thereon or that the cost of collecting such 
debt is likely to exceed the amount of the recovery.
    (b) Definitions. For purposes of this subpart, the following 
definitions apply:
    (1) Office means any of the following:
    (i) United States Fire Administration.
    (ii) Federal Insurance Administration.
    (iii) National Preparedness Directorate.
    (iv) State & Local Programs & Support Directorate.
    (v) U.S. Fire Academy/National Emergency Training Center.

[[Page 116]]

    (vi) Office of Financial Management, which for purposes of this 
subpart shall include all FEMA Headquarters elements not included in 
paragraphs (b)(1)(ii) through (b)(1)(iv) of this section.
    (vii) FEMA Special Facility.
    (2) Employee means those persons defined in 5 U.S.C. 2104, members 
of and retirees from the uniformed services of the United States and 
employees of and retirees from the United States Postal Service and the 
Postal Rate Commission.

[57 FR 54714, Nov. 20, 1992]



Sec. 11.31  Adoption of joint standards.

    All administrative actions to collect debts arising out of 
activities of the Agency shall be performed in accordance with the 
applicable standards prescribed either in 4 CFR parts 101 through 105 or 
any standards promulgated jointly by the Attorney General and the 
Comptroller General. Such standards are adopted as a part of this 
subpart and are supplemented in this subpart. Additional guidance will 
be found in the GAO Policy and Procedures Manual for Guidance of Federal 
Agencies and in the Treasury Fiscal Requirements Manual.



Sec. 11.32  Subdivision and joining of debts.

    (a) A debtor's liability arising from a particular transaction or 
contract shall be considered as a single debt in determining whether the 
debt is one not exceeding $100,000 or such higher limit prescribed by 
the Attorney General in accordance with 31 U.S.C. 3711(a)(2) exclusive 
of interest for the purpose of compromise or termination of collection 
action. Such a debt may not be subdivided to avoid the monetary ceiling 
established by the Act.
    (b) Joining of two or more single debts in a demand upon a 
particular debtor for payment totaling more than $100,000 or such higher 
limit prescribed by the Attorney General in accordance with 31 U.S.C. 
3711(a)(2) does not preclude compromise or termination of collection 
action with respect to any one of such debts that do not exceed $100,000 
or such higher limit prescribed by the Attorney General in accordance 
with 31 U.S.C. 3711(a)(2) exclusive of interest.

[49 FR 38267, Sept. 28, 1984, as amended at 57 FR 54714, Nov. 20, 1992]



Sec. 11.33  Authority of offices to attempt collection of debts.

    The head of each office and each regional director shall designate a 
debt collections officer (DCO) who shall attempt to collect in full all 
debts of the Agency for money or property arising out of the activities 
of such office. Each DCO shall establish and currently maintain a file 
with regard to each debt for which collection activities are undertaken. 
Insofar as it is feasible, debt collection personnel shall have personal 
interviews or telephone contact with the debtor.



Sec. 11.34  Referral of debts to the Chief Financial Officer, Federal Emergency Management Agency.

    (a) Authority of the Chief Financial Officer (CFO), Federal 
Emergency Management Agency.
    (1) The Chief Financial Officer, Federal Emergency Management 
Agency, is designated as the Agency Collections Officer (ACO). In this 
capacity he or she shall exercise such powers and perform duties of the 
Director in collecting debts owed FEMA. In this regard, the ACO may, 
after consultation with the Office of the General Counsel, compromise, 
suspend or terminate collection action on the debts owed the Agency, not 
exceeding $100,000, or such higher limit prescribed by the Attorney 
General in accordance with 31 U.S.C. 3711(a)(2), exclusive of interest, 
except as provided in Sec. 11.35 and paragraph (b) of this section. In 
addition, the CFO is delegated all authority which may be exercised by 
the Director, Federal Emergency Management Agency in relation to:
    (i) Disclosure to a consumer reporting agency in accordance with 31 
U.S.C. 3711(f),
    (ii) Instituting salary offset procedures in accordance with 5 
U.S.C. 5514(a),
    (iii) Instituting administrative offset procedures in accordance 
with 31 U.S.C. 3716,
    (iv) Charging of interest and penalties in accordance with 31 U.S.C. 
3717,

[[Page 117]]

    (v) Entering into contracts for collection of debts in accordance 
with 31 U.S.C. 3718, except that the execution and administration of 
such contracts is delegated to Federal Emergency Management Agency 
contracting officers appointed under provisions of 48 CFR 1.603-3,
    (vi) Prescribe debt collection procedures and manage debt collection 
activities within the Agency.
    (2) When initial attempts at collection by the office originating 
such debt have not been fully successful, the debt file shall be 
forwarded to the ACO for further administrative collection procedures. 
Debts shall be referred to the ACO well within the applicable statute of 
limitations (28 U.S.C. 2415 and 2416).
    (b) Exclusions. There shall be no compromised or terminated 
collection action with respect to any debt: (1) As to which there is an 
indication of fraud, the presentation of a false claim, or 
misrepresentation on the part of the debtor or any other party having an 
interest in the claim; (2) based in whole or in part on conduct in 
violation of the anti-trust laws; (3) based on tax statutes; or (4) 
arising from an exception made by the General Accounting Office in the 
account of an accountable officer. Such a debt shall be promptly 
referred to the Justice Department, or GAO, as appropriate, after ACO 
has consulted with the Inspector General and the Office of General 
Counsel.
    (c) Delegation. The ACO may delegate his or her authority in the 
FEMA debt collection program and under this subpart to a Deputy or to 
others in the FEMA Office of Financial Management. However, the ACO must 
personally approve any compromise, suspension or termination of 
collection efforts on debts exceeding $10,000.00.

[49 FR 38267, Sept. 28, 1984, as amended at 50 FR 40007, Oct. 1, 1985; 
53 FR 47211, Nov. 22, 1988; 57 FR 54714, Nov. 20, 1992]



Sec. 11.35  Authority of offices to compromise debts or suspend or terminate collection action.

    Where it appears that the cost of collecting a debt of $2,500 or 
less will exceed the amount of recovery, the DCO is authorized to 
compromise the debt or to terminate collection action. Further, DCO's 
are authorized to compromise a debt or terminate or suspend collection 
action for debts of $2,500 or less where:
    (a) Debtor cannot be located despite vigorous efforts, including but 
not limited to, use of skip tracing services, have failed to ascertain 
the debtor's current address.
    (b) Debtor is financially unable to pay in full or in part. DCO's 
must obtain a financial statement from the debtor in such cases.
    (c) The debt is without merit or cannot be substantiated by 
evidence. In such cases, debt collection officers should secure the 
advice of counsel. DCO's must document the debt file to show all 
evidence and reasons for compromise or termination of such debts. The 
DCO must prepare a narrative report and forward a copy of the report to 
the ACO.

[49 FR 38267, Sept. 28, 1984, as amended at 53 FR 47211, Nov. 22, 1988]



Sec. 11.36  Debt collection files.

    Each DCO is responsible for obtaining current credit data about each 
person against whom a debt is pending in his office. The files shall be 
kept up-to-date by the ACO for claims referred to his/her office for 
collection. Such credit data may take the form of:
    (a) A commercial credit report, showing the debtor's assets and 
liabilities and his income and expenses,
    (b) The individual debtor's own financial statement, executed under 
penalty for false claim, reflecting his assets and liabilities and his 
income and expenses, or
    (c) An audited balance sheet of a corporate debtor.

The file should also contain a checklist or brief summary of action 
taken to collect or compromise a debt. All debts files relating to debts 
owed by individuals are to be safeguarded in accordance with 5 U.S.C. 
552a, popularly known as the ``Privacy Act of 1974''; 31 U.S.C. 3711 et 
seq., popularly known at the ``Debt Collection Act of 1982''; 44 CFR 
part 6 and this subpart. Each DCO is responsible for maintaining files 
on debtors with information sufficient to

[[Page 118]]

enable the Government to effectuate administrative or judicial 
collection.

(Approved by the Office of Management and Budget under control number 
3067-0122)



Sec. 11.37  [Reserved]



Sec. 11.38  Annual reports to the Director, Office of Management and Budget, and the Secretary of the Treasury.

    (a) The ACO shall gather data on loans, accounts receivable, and 
debts which are required by 31 U.S.C. 3719 and shall transmit them to 
the Director, Federal Emergency Management Agency. Such data shall 
include:
    (1) The total amount of loans and accounts receivable owed to the 
Agency and when the funds owed to the Agency are due to be repaid;
    (2) The total amount of receivables and number of debts that are at 
least thirty days past due;
    (3) Total amount written off as uncollectable, actual, and allowed 
for;
    (4) The rate of interest charged for overdue debts and the amount of 
interest charged and collected on debts;
    (5) The total number of debts and total amount collected;
    (6) The number of debts and the total amount of debts referred to 
the Department of Justice for settlement or collection and the total 
number of debts and the total amount of debts settled or collected by 
that Department;
    (7) For each program or activity administered by the Agency, the 
data described in paragraphs (a) (1) through (6) of this section; and
    (8) Such other data as the Director, Office of Management and 
Budget, shall prescribe by regulations issued under authority of 31 
U.S.C. 3719.
    (b) Data described in paragraph (a) of this section shall be 
collected on a calendar year basis and transmitted to the Director, FEMA 
not later than the end of January of the year following the year for 
which the data described in paragraph (a) of this section, were 
collected. The Director, FEMA, shall report these data to the Secretary 
of the Treasury and the Director, Office of Management and Budget in 
accordance with 31 U.S.C. 3719. If the Secretary of the Treasury and the 
Director, Office of Management and Budget prescribe, by regulation, a 
different annual reporting cycle, the Agency's reporting cycle, 
described in the first sentence of this subsection shall be changed to 
conform with the cycle prescribed by the Department of the Treasury and 
Office of Management and Budget regulation.



Sec. 11.40  Records retention.

    The file of each debt on which administrative collection action has 
been completed shall be retained by the appropriate officer not less 
than 1 year after the applicable statute of limitations has run.



Sec. 11.41  Suspension or revocation of eligibility.

    (a) Where a contractor, grantee, or other participant in programs 
sponsored by the Agency fails to pay his debts to the Agency within a 
reasonable time after demand, the fact shall be reported by the ACO to 
the Inspector General and to the Office of Acquisition Management, which 
shall place such defaulting participant's name on the Agency's list of 
debarred, suspended and ineligible contractors and grantees. The 
participant will be so advised. Suspension or revocation of eligibility 
may be waived in whole or in part in the case of grants for disaster 
programs administered by FEMA, if the Director FEMA, so directs.
    (b) The failure of any surety to honor its obligations in accordance 
with 6 U.S.C. 11 is to be reported at once to the ACO, who shall so 
advise the Treasury Department. That Department will notify this Agency 
when a surety's certificate of authority to do business with the 
Government has been revoked or forfeited.
    (c) Failure by a recipient of FEMA financial or nonfinancial 
assistance to pay a substantial debt or a number of outstanding debts 
being collected under this subpart may be ground for Government-wide 
debarment and suspension as described in 44 CFR 17.305(c)(3).

[49 FR 38267, Sept. 28, 1984, as amended at 57 FR 54715, Nov. 20, 1992]



Sec. 11.42  Demand for payment of debts.

    (a) Initial demand. An initial demand shall be made in writing and 
sent by

[[Page 119]]

certified mail, return receipt requested, or delivered by hand to the 
debtor identifying the debt and advising that the full amount due should 
be paid by a specified date, not less than 30 days from the date of 
mailing or the hand delivery. If the debtor is other than a State or 
local government or an agency of the United States, the initial demand 
notice shall also advise the debtor that interest, calculated at rates 
provided by 31 U.S.C. 3717(a), shall be assessed if the debt is not paid 
in full by the due date. Interest shall be charged on the outstanding 
balance due at the rate prescribed by the Secretary of the Treasury in 
accordance with 31 U.S.C. 3717(a), beginning on the date that the first 
notice was mailed to the debtor. The debtor shall also be advised that 
if any portion of the debt remains unpaid for 90 days after the due 
date, without a repayment schedule satisfactory to the Agency being 
arranged, then additional penalties, as described in 31 U.S.C. 
3717(e)(2), of 6 percent per year shall be charged on the unpaid balance 
of principal and interest.
    (b) Subsequent demands. If the debt is not paid by the due date or 
if a repayment program acceptable to the ACO, has not been arranged with 
the debtor, then an initial demand shall be made followed by two 
progressively stronger written demands at not more than 30-day 
intervals, will be made unless a response to the initial or subsequent 
demands indicates that further demands would be futile and that the 
debtor's response does not require rebuttal.
    (c) Debts arising from contracts executed on or before October 25, 
1982. If the claim arises from a contract executed before October 25, 
1982, then the initial and subsequent demands shall mention nothing 
about the imposition of penalties or interest, prior to rendering of 
judgment by a court of competent jurisdiction.
    (d) Waiver of subsequent written demands. If there is valid reason, 
the sending of second and third demand letters may be waived. Such 
reasons may include, but are not be limited to, statute of limitations 
being about to run.

[49 FR 38267, Sept. 28, 1984, as amended at 53 FR 47211, Nov. 22, 1988; 
57 FR 54715, Nov. 20, 1992]



Sec. 11.43  Collection from non-Government entities by administrative offset.

    (a) General. The Agency Collections Officer may effectuate 
collection of debts owed by persons or entities, other than Federal 
agencies or State or local governments, by means of offsets against 
monies due from the United States under provisions of 31 U.S.C. 3716 and 
the procedures set forth below. The procedures, prescribed by this 
subsection, shall not be used if the debtor has executed a written 
agreement, satisfactory to the ACO, for the payment of the debt so long 
as the debtor adheres to the provisions of the agreement. Before 
utilizing the procedures of this section, the ACO, or his designee, 
shall examine the debt to see whether the likelihood of collecting such 
a debt and the best interests of the United States justify the use of 
administrative offset. If the debt is over 6 years old but is not 10 
years old, the ACO shall examine the debt and decide whether utilizing 
these procedures is cost effective. Further, administrative offset 
procedures shall not be used on debts more than 10 years after the 
Government's right to collect the debt first accrued unless facts 
material to the Government's right to collect the debt were not known 
and could not have been known by the officials of the Government who 
were charged with responsibility to discover and collect the debt.
    (b) Written notice. After the ACO or his designee has examined the 
debt under procedures set forth in paragraph (a) of this section, a 
notice shall be sent by certified mail, return receipt requested, to the 
debtor advising him of:
    (1) Nature and amount of the debt determined by the Agency to be 
due, and of intention to collect by administrative offset,
    (2) Rights available under this section,

[[Page 120]]

    (3) Opportunity to inspect and copy the records relating to the 
debt,
    (4) Opportunity for review within the Agency with respect to the 
debt, and
    (5) Opportunity to enter into an agreement with the ACO with respect 
to the debt. Such agreement may include voluntary but nonrevocable 
withholding of monies due from the United States to the debtor.
    (c) Review within the Agency. The debtor may request, within fifteen 
calendar days after receipt of the written notice specified in paragraph 
(b) of this section, review within the Agency as to the existence or 
amount of the debt or terms of repayment. The review shall be conducted 
by a member of the staff of the Office of General Counsel not involved 
in collection of debts under the Agency program which gave rise to the 
debt. The staff member, with the concurrence of the ACO, may determine 
that no debt is due, the amount of the debts should be reduced, that 
terms of repayment should be set, or that the demanded amount should be 
paid in full. The staff member may negotiate with the debtor concerning 
a written agreement for the repayment of the debt. However, such 
agreement shall be subject to approval by the ACO.
    (d) If no written agreement is executed, if the debtor does not 
request review within the Agency, or if the review within the Agency 
determines that a debt is due, then administrative offset against monies 
payable by the United States shall be effectuated in accordance with 
appropriate regulations. Efforts shall be made to coordinate offset 
collections with other agencies, including use of the Army Holdup List. 
However, if a statute either prohibits or explicitly provides for 
collection through administrative offset of the debt or the type of debt 
involved then the provisions of that statute rather than the provisions 
of this section shall be used for such offset.
    (e) If the debtor has a judgment against the United States, then 
notice shall be provided to the General Accounting Office for offset in 
accordance with 31 U.S.C. 3728.
    (f) The procedures described in this section do not apply to 
collecting a debt by taking offsets against Federal income taxes that 
would otherwise be paid to the debtor. (See Secs. 11.61 through 11.65 of 
this subpart below.)

[49 FR 38267, Sept. 28, 1984, as amended at 57 FR 54715, Nov. 20, 1992]



Sec. 11.44  Collection of debts from Federal agencies or States or units of general local government by common law offset.

    (a) Debts owed by Federal Agencies, States, or units of general 
local government may be collected by offset in accordance with 
principles of common law. See U.S. v. Munsey Trust Co., 332 U.S. 234 
(1947). Offset may also be taken against States and units of general 
local government under provisions of 44 CFR 13.52(a)(1). Before taking 
such an involuntary offset against such debtors, the ACO or the DCO must 
notify such debtors as to:
    (1) Nature and origin of the debt.
    (2) Amount owed.
    (3) FEMA's intent to collect interest at rates equivalent to those 
paid by the U.S. Government to borrow money on the open market, unless 
statute, regulation or agreement specifies another interest rate.
    (4) Right of the debtor to inspect and copy records relating to the 
debt. However, FEMA may, in its discretion, utilize exemptions available 
under the Freedom of Information Act (5 U.S.C. 552(B)).
    (5) Name, business address and telephone number of the official 
having cognizance over the debt.
    (b) Prior to instituting involuntary offset against such debtors, 
DCO's must obtain approval of the ACO.

[53 FR 47211, Nov. 22, 1988, as amended at 57 FR 54715, Nov. 20, 1992]



Sec. 11.45  Collection by salary offset.

    (a) General. Where an individual is an employee of the Federal 
Government or a member of the Armed Forces or a reserve component of the 
Armed Forces or is receiving retired or retainer pay for service as a 
Federal employee and where the individual is indebted to the United 
States and where the individual fails to satisfy his indebtedness 
voluntarily after the Agency has made demands in accordance with 
Sec. 11.42 of this part, the ACO may institute collection action by 
salary or pay offset procedures in accordance

[[Page 121]]

with 5 U.S.C. 5514, 5 CFR 550.1101 through 550.1106, 5 CFR part 845, 5 
CFR 831.1301 et seq., and the procedures described below.
    (b) Notice to debtor. At least 30 days prior to initiating salary 
offset, the ACO or his designee shall send notice by certified mail, 
return receipt requested, to the debtor advising him of:
    (1) Nature, origin and amount of indebtedness determined by the 
Agency to be due, the date that the debt was due, and a statement that 
FEMA has complied with applicable statutes, regulations and procedures,
    (2) Agency intention to initiate proceedings to collect the debt by 
deductions from pay,
    (3) Rights available under 5 U.S.C. 5514(a),
    (4) Debtor's opportunity to inspect and copy Government records 
relating to the debt,
    (5) Opportunity to enter into a written agreement, under terms 
satisfactory to the ACO, to establish terms for the repayment of the 
debt, and
    (6) Opportunity for a hearing, described in paragraph (c) of this 
section, concerning the existence or the amount of the debt or, if no 
repayment schedule has been established (in accordance with paragraph 
(b)(1) of this section) concerning the terms of the repayment schedule,
    (7) If there is a statutory provision authorizing waiver, remission, 
or forgiveness of the debt due the United States; the individual will be 
notified as to:
    (i) Nature of the provision,
    (ii) Explanation of the conditions under which the waiver shall be 
granted,
    (iii) Reasonable opportunity to request a waiver,
    (iv) If waiver is requested, then a written response will be given 
to the request.
    (c) Hearing. The debtor shall file a written petition for hearing or 
for a waiver (if applicable) on or before the twentieth calendar day 
after receipt of notice, referred to in paragraph (b) of this section, 
addressed to the Agency Collections Officer, Federal Emergency 
Management Agency, Washington, DC 20472. The postmark or receipt date, 
if mail is not used, shall establish the date of petition.
    (1) The hearing official shall be an Administrative Law Judge or a 
person of grade GS/GM-14 or higher, not under the supervision or control 
of the Director, FEMA. The Director may enter into interagency support 
agreements with other Federal agencies or departments for providing 
hearing officials.
    (2) The hearing shall be informal but the debtor shall be given the 
basic safeguards of due process. The debtor shall have the right to be 
represented by an attorney. A summary record shall be made of the 
proceedings at the hearing. The hearing shall, insofar as possible, be 
conducted at a location and time convenient to the debtor.
    (3) As soon as practicable, but in no event later than 60 days after 
the filing of the petition for hearing, the hearing official shall 
render a final decision. If a hearing is requested, no further action 
shall be taken to collect the debt until the final decision is rendered.
    (d) Amount deducted. The amount deducted from pay for any period 
shall not exceed 15 percent of disposable pay. However, the debtor may 
voluntarily agree to the deduction of a greater amount of pay. 
Disposable pay means that part of pay of any individual remainng after 
the deduction from those earnings of any amounts required by law to be 
withheld. However, installment payments of less than $25.00 will be 
accepted only in the most unusual circumstances. Disposable pay is 
defined in 5 CFR 550.1103 and 5 CFR 581.105(b) through (f).
    (e) Procedural requirements specified in paragraph (c) of this 
section shall not be used in cases of collections of such obligations as 
changes in coverage under a Federal benefits program or resulting from 
ministerial adjustments pay and allowances which cannot be placed in 
effect immediately because of normal processing delays.
    (f) When an employee, who is subject to salary offset in accordance 
with this section and who is making repayment in installments, finds 
that total repayment of the debt is about to be made, then the employee 
must notify the employee's payroll office, at least two pay periods 
before the final payment, that final payment is being made.

[[Page 122]]

    (g) Debts arising from travel advances provided under 5 U.S. C. 5705 
and for travel and transportation expenses for transferred employees 
under 5 U.S.C. 5724 may be collected by taking offsets in accordance 
with 44 CFR 11.43.

[49 FR 38267, Sept. 28, 1984, as amended at 50 FR 40007, Oct. 1, 1985; 
57 FR 54715, Nov. 20, 1992]



Sec. 11.46  Liquidation of collateral.

    Where FEMA holds security or collateral that may be liquidated and 
the proceeds applied on debts due it through the exercise of a power of 
sale in the security instrument or a nonjudicial foreclosure, such 
procedures should be followed if the debtor fails to pay his debt within 
a reasonable time after demand, unless the cost of disposing of the 
collateral will be disproportionate to its value or special 
circumstances require judicial foreclosure.



Sec. 11.47  Collection in installments.

    Debts with accrued interest and penalties should be collected in 
full in one lump sum whenever this is possible. However, if the debtor 
is financially unable to pay the indebtedness in one lump sum, payment 
with applicable interest may be accepted in regular installments in 
accordance with a written agreement approved by the ACO or his designee. 
If possible, installment payments shall be sufficiently large to 
complete collection in the three years. Installment payments should not 
be less than $50.00 per month unless there are most unusual 
circumstances. The Agency may require the debtor to execute a confess-
judgment, negotiable note for the amount of the indebtedness. The ACO or 
DCO may require the debtor to provide a statement as to financial 
condition.



Sec. 11.48  Interest and penalties.

    (a) Interest. Interest shall be charged on the outstanding principal 
balance due on debts owed the United States at the rate published by the 
Secretary of the Treasury under provisions of 31 U.S.C. 3717(a). 
Interest shall be assessed on debts owed by States and units of general 
local government at rates equivalent to rates paid by the United States 
Treasury to borrow money on the open financial markets. The interest 
rate in effect at the time that FEMA first mailed or hand delivered to 
the debtor written notice, stating that the debt was due and that 
interest would be assessed on the debt, shall be the rate applied 
throughout the duration of the debt until the debt is paid in full. 
Interest shall accrue either from the date that the debtor was first 
informed that interest would be assessed or some subsequent date 
specified in the written notice given by FEMA to the debtor stating that 
interest would be assessed. Interest shall run from the following dates:
    (1) If the initial demand for the debt was mailed on or after 
October 25, 1982, then the date of mailing to the debtor (using the most 
current address available to the ACO), or
    (2) If the initial demand for the debt was mailed before October 25, 
1982, then from the date that a demand letter was mailed after October 
25, 1982.
    (b) Exceptions to interest charges. However, no interest, described 
in paragraph (a) of this section, shall be charged if:
    (1) The amount due is paid within 30 days of the mailing of the 
demand. However, the ACO for good cause shown, as documented by a 
memorandum in the debt collection file, may extend this 30 day period, 
or
    (2) The applicable statute, regulation required by statute, loan 
agreement or contract either prohibit the charging of interest or 
explicitly fix interest or charges which apply to the debt involved.
    (c) Penalty charges. Except in the situation described in paragraph 
(b) of this section, a penalty of 6 per centum per annum shall be 
charged on the unpaid principal balance due if the debtor fails to pay 
the debt in full within 120 days of the date of the first written notice 
by FEMA that penalty charges would be assessed. However, if the debtor 
enters into a repayment agreement, satisfactory to FEMA, within the 120 
day period, then penalty will not be assessed. Penalty will accrue 
starting on and including the 31st day following the first written 
notice about penalty. Penalty will not be assessed

[[Page 123]]

against Federal agencies, States, or units of general local government.
    (d) Administrative costs for processing delinquent debts. The debtor 
shall pay administrative costs of processing delinquent debts in 
accordance with 31 U.S.C. 3717(e)(1). Costs of preparing and mailing 
follow-up debt collection letters shall also be included. Administrative 
costs are deemed to include, but not be limited to, costs of employing 
commercial firms to locate the debtor, costs of employing contractors 
for collection services, costs of selling collateral or property to 
satisfy the debt, etc. States and units of general local government 
shall be liable for administrative costs to the extent authorized under 
the common law or other statutory or contractual authority. A debt is 
deemed to be delinquent if it remains unpaid for 30 days after the 
initial demand for payment and if the debtor has not entered into a 
repayment agreement satisfactory to FEMA. A debt is also deemed 
delinquent if payment is not made by the date specified in FEMA's 
initial written notification or in the applicable contractual agreement.
    (e) Standards for waiver of interest, penalties and charges. (1) 
Interest, penalties and delinquent debts charges may be waived, either 
in whole or in part, if the ACO or his designee finds that:
    (i) The debtor is financially unable to pay, (ii) the Agency's 
enforcement policy will be adequately served if there is a waiver in 
whole or in part or (iii) the debtor has shown good cause, satisfactory 
to the ACO, that the claim was not timely paid. If waiver is granted, 
the administrative claims file shall be adequately documented.
    (2) The ACO, with the concurrence of the General Counsel, may waive 
interest, penalties and administrative costs based on criteria set forth 
in paragraphs (e) (3) through (5) of this section. When such charges are 
waived, the Agency Collections Officer shall prepare a memorandum for 
the file stating the reasons for not collecting such charges.
    (3) If the costs of collection exceed the projected recovery then 
interest, penalties and administrative costs may be waived.
    (4) If the debtor has a bona fide dispute as to facts or has raised 
valid legal issues, then charges may be waived.
    (5) If it is determined that the debtor is unable to pay, as shown 
by complete and sworn statements as to his or her assets and projected 
income, then interest, penalties and charges may be waived in whole or 
in part. If the principal outstanding amount of the debt exceeds $2,500, 
the determination shall be made by the ACO. If the principal outstanding 
amount of the debt is $2,500 or less, the determination may be made by 
the DCO or the ACO.
    (f) Nonapplicability. The provisions of this section do not apply to 
debts owned by Federal agencies and State and local governments. 
Interest on such debts owed by such entities shall be charged in 
accordance with applicable statute or, if nonexistent, then in 
accordance with principles of common law.
    (g) Installment collections or partial payments. When a debtor pays 
a debt either partially or in installments, the payments shall first be 
applied to administrative costs and penalty charges, second to accrued 
interest, and third to principal. Partial payments shall be deemed to be 
made when received at the FEMA office designated to receive the 
payments.
    (h) Collection of interest and penalties while an appeal is pending. 
If the debtor notes an appeal either as to the existence or the amount 
of the debt, interest and penalties may be waived or suspended by the 
ACO under the following circumstances:
    (1) In the case of a State or a unit of general local government, 
interest shall be assessed on those amounts found due after the appeal 
process is completed and shall run from the time that the debtor 
government was first provided written notice by FEMA that interest would 
be assessed. However, the ACO may waive interest in whole or in part if 
the State or unit of general local government:
    (i) Shows that its taxes or revenues will be insufficient to enable 
the government to meet essential government expenses.
    (ii) Substantially prevails in its appeal, and pays the entire 
balance found

[[Page 124]]

to be due within 90 days of the decision on the appeal being transmitted 
to the appellant government.

If the State or unit of general local government is to be considered for 
waiver of interest due to governmental hardship, the ACO may demand that 
such government provide such economic, financial, or demographic data 
that the ACO believes to be necessary to assist her to him in 
determining the existence of such hardship.

    (2) In the case of an individual or a non-governmental entity which 
is noting an appeal which is mandated by law, then the imposition of 
interest and penalties is waived while the appeal is pending from the 
time that the appeal is noted until the Agency has taken final action on 
the appeal.
    (3) When an individual or a non-governmental entity notes an appeal 
which is permissive under statute or regulation, then interest and 
penalties may be waived under the following circumstances:
    (i) If the amount of the debt, exclusive of interest and penalties, 
is less than $5,000, then interest and penalties shall be waived from 
the time that the appeal is noted until the Agency takes final action on 
the appeal.
    (ii) If the amount of the debt, exclusive of interest and penalties, 
is $5,000 or more then the imposition of penalties and interest may be 
waived if there is no fault or lack of good faith on the part of the 
debtor and if the amount of interest is so high, in relation to 
affordable installments repayments that the debt would never be repaid. 
In determining whether interest and penalties should be waived, the ACO 
or DCO may demand that the debtor provide such financial data as he or 
she may demand.

[49 FR 38267, Sept. 28, 1988, as amended at 53 FR 47212, Nov. 22, 1988; 
57 FR 54715, Nov. 20, 1992]



Sec. 11.49  Omission not a defense.

    Failure to comply with any standard prescribed in 4 CFR chapter 11, 
or in this subpart shall not be available as a defense to any debtor.



Sec. 11.50  Standards for compromise of debts.

    (a) Compromise. (1) A debt may be compromised if:
    (i) The debtor is not able to pay the full amount within a 
reasonable period of time;
    (ii) If the debtor refuses to pay the debt in full and the Agency is 
unable to enforce collection within a reasonable time by enforced 
collection proceeding;
    (iii) If there is real doubt concerning the Agency's ability to 
prove its case in court for the full amount claimed;
    (iv) If the cost of collecting the debt does not justify the 
enforced collection of the full amount;
    (v) If, in connection with statutory penalties or forfeitures 
established as an aid to enforcement and to compel compliance, the 
Agency's enforcement policy will be adequately served by acceptance of 
the sum to be agreed upon; or
    (vi) For other reasons deemed valid by the ACO after consultation 
with the General Counsel. The Standards set forth in 4 CFR 103.3 through 
103.9 should be used.
    (2) Inability to pay. If a debtor is unable to pay the full amount 
of the debt within a reasonable time or if the debtor refuses to pay and 
the Government is unable to collect the amount of the debt through 
enforcement proceedings then the Agency may compromise the claim either 
in whole or in part. The ACO may require that the debtor provide sworn 
information as to assets, actual or potential sources of income, 
liabilities and other financial data. The standards set forth in the 
GAO, Department of Justice guidelines prescribed in 4 CFR 103.2 should 
be used.
    (3) Compromises payable in installments will not normally be 
permitted by the Agency only if the debtor shows that full, immediate 
payment is impossible.
    (4) Litigative probabilities. If there is a bona fide dispute as to 
facts or if there is a valid legal defense raised which may limit or 
eliminate the possibility of recovery, then the Agency Collections 
Officer may, after receiving a legal analysis from the General Counsel, 
compromise the action in whole or in part.

[[Page 125]]

    (b) Documentary evidence of compromise. No compromise of a debt 
shall be final or binding on the Agency unless it is in writing and 
signed by the appropriate officer who has authority to compromise the 
claim pursuant to this subpart.
    (c) Authority. Only the ACO may compromise debts of more than 
$2,500. Debts of $2,500 or less may be compromised by the ACO or the 
DCO. Debts exceeding $100,000 or such other limit prescribed by the 
Attorney General in accordance with 31 U.S.C. 3711(a)(2) may be 
compromised only after approval by the Department of Justice in 
accordance with 4 CFR 103.1(b).

[49 FR 38267, Sept. 28, 1984, as amended at 53 FR 47212, Nov. 22, 1988; 
57 FR 54715, Nov. 20, 1992]



Sec. 11.51  Standards for suspension or termination of collection.

    (a) Suspension of collection action. (1) Collection action shall be 
suspended temporarily on a debt when the debtor cannot be located after 
diligent effort but there is reason to believe that future collection 
action may be sufficently productive to justify periodic review and 
action on the claim, making consideration for its size and the amount 
which may be realized. Collection action may be suspended temporarily on 
a debt when the debtor owns no subsantial equity in realty and is 
presently unable to make payment on the Agency's debt or effect a 
compromise, but his future prospects justify retention of the claim for 
periodic review and action, and, (i) the applicable statute of 
limitations has been tolled or started anew, or (ii) future collection 
can be effected by offset notwithstanding the statute of limitations. 
Suspension as to a particular debtor should not defer the early 
liquidation of security for the debt. Standards prescribed in 4 CFR part 
104 shall be used in making determinations as to suspension as 
termination of collection efforts.
    (2) No substantial recovery possible. If, at the time that 
collection is attempted, debtor is without assets or actual or potential 
income or if the debtor may have exemptions under the bankruptcy laws 
which make enforced collection of the debt not cost-effective, then 
collection action may be suspended. However, interest and other charges 
will accumulate unless waived.
    (3) Debtor cannot be located. If the debtor cannot be located or is 
outside the United States, then collection action may be suspended until 
the debtor is located. The statute of limitations will be tolled during 
those periods that the debtor is outside the United States.
    (b) Termination of collection action. (1) Collection action may be 
terminated and the Agency file closed for the following reasons: (i) No 
substantial amount can be collected; (ii) the debtor cannot be located; 
(iii) the cost will exceed recovery; (iv) the claim is legally without 
merit; or (v) the claim cannot be substantiated by evidence.
    (2) No substantial recovery possible. If there is little likelihood 
that collection efforts will result in any substantial recovery, then 
collection efforts may be terminated. Costs of recovery may be a factor 
in determining whether any recovery would be substantial. Normally, 
costs of recovery would be more important in cases of small debts than 
in cases of large ones.
    (3) Debtor cannot be located. Every effort, including, but not 
limited to, use of governmental records, Internal Revenue Service 
taxpayer information, private contractor skip tracer and credit 
agencies, shall be made to locate debtors in advance of the runnning of 
the statute of limitations. If the debtor cannot be located, then the 
Agency Collections Officer may determine, with the concurrence of the 
General Counsel, that collection efforts may be terminated.
    (4) Litigative possibilities. The criteria and procedures of 
Sec. 11.50(a)(4) of this subpart may be used to terminate collection 
efforts if it appears unlikely that the Government would prevail if it 
were to litigate collection of the debt.
    (c) Debts exceeding $100,000. Debts exceeding $100,000 or higher 
limits prescribed by the Attorney General in accordance with 31 U.S.C. 
3711(a)(2) (exclusive of interest, penalty charges and administrative 
charges) shall not be compromised by FEMA unless the proposed compromise 
has been referred for approval by the Department of Justice

[[Page 126]]

in accordance with 4 CFR 104.1(b). Such proposed compromises shall be 
referred to the Office of General Counsel, which shall review the 
proposal before being forwarded to the Department of Justice. However, 
where a debt claim is of no legal merit, the ACO may compromise such a 
debt without referral to the Department of Justice but only with the 
concurrence of the Office of General Counsel.
    (d) Enforcement policy. Statutory penalties and forfeitures are used 
as an aid to secure compliance with FEMA requirements and to compel 
payment. These may be waived if the Agency's enforcement policy in terms 
of securing payment and securing compliance with FEMA regulations would 
be sreved by accepting a sum agreed upon. Mere accidental or technical 
violations will be dealt with less severly than willful or substantial 
violations.

[49 FR 38267, Sept. 28, 1984, as amended at 53 FR 47212, Nov. 22, 1988; 
57 FR 54715, Nov. 20, 1992]



Sec. 11.52  Referral of delinquent debtors to consumer reporting agencies.

    (a) General. This section implements 31 U.S.C. 3711(f) concerning 
reporting of debtors having overdue debts to consumer reporting 
agencies.
    (b) Procedures. When a debt is unpaid for 120 days after the initial 
demand letter has been sent and where the debtor has not repaid the 
amount due nor has the debtor entered into an agreement for repayment 
satisfactory to the ACO or his designee, or the debt is not subject to 
administrative offset (as described in Sec. 11.43), the ACO may report 
the claim to consumer reporting agencies if:
    (1) The Agency Collections Officer or his designee has determined 
that the debt is overdue,
    (2) Notice has been sent certified mail, return receipt requested, 
to debtor informing him that:
    (i) Payment of the debt is overdue,
    (ii) The Agency intends to disclose the debtor's debt records to a 
consumer reporting agency within a stated period, not less than 60 days 
after the mailing of such debt,
    (iii) Specified items of information being released shall be listed 
in the notice. Such items will normally include the debtor's name, 
taxpayer account number, last known address, other information necessary 
to establish the identity of the individual, the nature, amount and 
status of the outstanding claim, and programs under which the claim 
arose, and
    (iv) The debtor has a right to a full explanation of the debt, to 
dispute any information in the records concerning the debt, and to have 
an administrative review. If the debtor petitions for administrative 
review, then no further action on referring debtor information to 
consumer reporting agencies shall be undertaken until the administrative 
review is completed.
    (c) Administrative review. The debtor shall send with his petition 
arguments in writing and documentary evidence to the Agency Collection 
Officer, Office of Financial Management, Federal Emergency Management 
Agency, Washington, DC 20472. These shall be reviewed by the ACO or an 
official designated by him. The reviewing official shall prepare a 
reply, within 60 days after receipt of the petition, either accepting 
the debtor's assertions in whole or is part or rejecting them. If the 
debtor's assertions are rejected in whole or in part, then the debt 
data, described in paragraph (b)(2)(iii) of this section (with 
correction made as indicated by the reviewing official) shall be sent to 
consumer reporting agencies.
    (d) Information released. Information released to consumer reporting 
agencies shall be limited to the following items:
    (1) Name of debtor, address, taxpayer identification number, and 
other information necessary to establish the identity of the debtor,
    (2) Amount, status and history of the debt and
    (3) Program under which the debt arose.

[49 FR 38267, Sept. 28, 1984, as amended at 57 FR 54715, Nov. 20, 1992]



Sec. 11.53  Securing debtor addresses from the Department of Treasury.

    (a) If the ACO is unable to obtain a current address for the debtor, 
then a written request shall be sent to the Secretary of the Treasury 
asking for the debtor's most current mailing address from the Department 
of the

[[Page 127]]

Treasury taxpayer identity information files for Agency use in 
collecting claims. Any information so received from the Secretary of the 
Treausury shall be safeguarded in accordance with provisions of 26 
U.S.C. 6103(p)(4) and 26 CFR parts 301 and 601.
    (b) Taxpayer identity information (which includes IRS current 
address and social security number) shall be released to consumer 
reporting agencies only for the purpose of preparation of commercial 
credit reports for use by Federal agencies in accordance with section 3 
of the Debt Collection Act (31 U.S.C. 3711(f)). A notice to this effect 
shall be placed on each page containing taxpayer identitiy information 
which is sent to consumer reporting agencies.



Sec. 11.54  Contracts with debt collection agencies.

    (a) General. FEMA shall utilize mandatory, government-wide debt 
collection agency contracts negotiated by the General Services 
Administration or the Department of the Treasury to effect collection of 
debts owed FEMA.
    (b) Debt collection contract provisions. Contracts entered into 
under authority of this secion shall have provisions relating to:
    (1) Protection of data relating to individuals which shall not be 
less than that provided under the terms of the Privacy Act (5 U.S.C. 
552a).
    (2) Protection of data derived from Department of the Treasury 
taxpayer identity information files shall in accordance with 26 U.S.C. 
6103(p)(4) and 26 CFR parts 301 and 601.
    (3) Authority to terminate collection action, settle or compromise 
claims shall remain with the Director of the Agency or the ACO rather 
than with the Contracting Officer.
    (4) Resolution of disputes relating to the claim shall remain with 
the ACO or the Agency Director. Resolution of disputes arising under the 
contract or with the contractor shall remain with the Agency Contracting 
Officer who shall handle such disputes in accordance with the Contract 
Disputes Act (Pub. L. 95-563).
    (5) Judicial enforcement of the claim shall be handled by the U.S. 
Department of Justice.
    (6) The contractor shall adhere to Federal and State laws and 
regulations pertaining to debt collection practices including the Fair 
Debt Collection Practices Act (15 U.S.C. 1692 et seq.)
    (7) Contracts, entered into under provisions of this section, shall 
be subject to competition to the maximum practicable extent.
    (8) The contractor shall be required to strictly account for all 
amounts collected.
    (c) Collection fees. Contracts entered into under this section may 
provide that fees payable to the contractor may be paid only from the 
amounts collected from the debtor as determined by the Contracting 
Officer. However, such contracts shall be funded only from funds 
available for the time period in which the contract is executed.

(Approved by the Office of Management and Budget under control number 
3067-0122)


[49 FR 38267, Sept. 28, 1984; 50 FR 40007, Oct. 1, 1985; 50 FR 42023, 
Oct. 17, 1985; 51 FR 34605, Sept. 30, 1986; 53 FR 47212, Nov. 22, 1988]



Sec. 11.55  Referral to GAO or Justice Department.

    (a) Referral to the Department of Justice. With the exception of 
debts described in paragraph (b), of this section, those debts which 
cannot be collected or compromised or terminated in accordance with 3 
CFR parts 103 and 104 and Secs. 11.50 and 11.51, shall be referred to 
the Department of Justice for collection action. All such referrals 
shall be done by the ACO, who shall consult with the FEMA Office of 
General Counsel. The referral shall be accompanied by a copy of the 
complete debt collection file. In addition, the following information 
shall be provided:
    (1) Current address of debtor. Effort shall be made to locate the 
debtor if he is missing. If the debtor is a corporation, then the name 
and address of the agent upon whom service of process may be made, shall 
be provided.
    (2) Credit data which may be in the form of a credit report or a 
statement, under oath, of the debtor's assets and liabilities.
    (3) History of prior collection actions.

[[Page 128]]

    (4) Data required by the GAO Claims Collection Litigation Report 
form. If the debt is less than $600, exclusive of interest, then 
referral shall not be made to the Department of Justice, except in 
unusual cases.
    (b) Referral to the General Accounting Office. Debts arising from 
audits exceptions taken by the General Accounting Office (GAO) shall be 
referred to GAO before referring such debts to the Department of 
Justice. If the merits of the debt or the propriety of a proposed 
compromise, suspension or termination are in doubt, then the matter 
should be referred to GAO prior to referral to the Department of 
Justice.
    (c) Prompt referral. Such referrals shall be made as early as 
possible consistent with aggressive collection action, and, in any 
event, well within the statute of limitation for bringing suit against 
the debtor. Ordinarily, debt collection referrals will be made to the 
Department of Justice within six months after FEMA has determined that a 
debt is owing in an amount certain.



Sec. 11.56  Analysis of costs.

    The ACO shall provide for periodic comparison of costs incurred and 
amounts collected. Data on costs and corresponding recovery rates for 
debts of different types and in various dollar ranges should be used to 
compare the cost effectiveness of alternative collection techniques, 
establish guidelines with respect to the points at which costs of 
further collection efforts are likely to exceed recoveries, assist in 
evaluating offers in compromise, and establish minimum debt amounts 
below which collection efforts need not be taken. Cost and recovery data 
should also be useful in justifying adequate resources for an effective 
collection action.



Sec. 11.57  Automation.

    The ACO shall work to automate the Agency's debt collection 
operations to the extent that it is cost effective and feasible.



Sec. 11.58  Prevention of overpayments, delinquencies, and defaults.

    The ACO shall establish procedures to identify the causes of 
overpayments, delinquencies, and defaults and the corrective actions 
needed. All debts or loans, when first established, may be reported to 
commercial credit bureaus.



Sec. 11.59  Office of General Counsel.

    The Office of General Counsel shall provide legal advice on claims 
collection matters to all debt collection officers and the Agency 
Collection Officer, as needed.



Sec. 11.60  Sale of debts due the United States arising under programs administered by the Agency.

    Where debts due the United States arising under programs 
administered by the Agency prove to be uncollectable or unresolvable 
through procedures described in Secs. 11.33 through 11.35, 11.41 through 
11.48, and 11.50 through 11.55 and where the stated value of the debt is 
less than $100,000 or such higher limit prescribed by the Attorney 
General in accordance with 31 U.S.C. 3711(a)(2), excluding penalties and 
interest, then the Agency may contract to sell or assign such debts 
under competitive sales procedures. The Agency may sell or assign debts 
valued at $600, or less, excluding penalties and interest, after 
decision by the ACO. Where the debt exceeds $600, but is less than 
$100,000 or such higher limit prescribed by the Attorney General in 
accordance with 31 U.S.C. 3711(a)(2), exclusive of interest and 
penalties, the Agency may sell or assign such debts only after the ACO 
has coordinated such action with the Department of Justice and the 
General Accounting Office.

[49 FR 38267, Sept. 28, 1984, as amended at 57 FR 54715, Nov. 20, 1992]



Sec. 11.61  Referral of delinquent debts to Internal Revenue Service.

    (a) FEMA may refer delinquent debts to the Internal Revenue Service 
(IRS) in accordance with 31 U.S.C. 3720A and the IRS implementing 
regulation, 26 CFR 301.6402-6T.
    (b) The following definitions apply to Secs. 11.61 through 11.65:
    Delinquent debt is a debt owed FEMA which has been unpaid for 65 
days or more following the mailing of the initial bill for collection 
(BFC) and for which no repayment plan has been accepted by FEMA.

[[Page 129]]

    Memorandum of Understanding (MoU) is an agreement entered into by 
the IRS, the U.S. Department of the Treasury's Financial Management 
Service (FMS), and FEMA for collecting delinquent debts owed FEMA by 
offset against income tax refunds.
    (c) FEMA will provide information to the IRS within time limits 
prescribed by the IRS and in accordance with the MoU. This information 
is to enable the Commissioner of the IRS to make a final determination 
as to FEMA's participation in the tax refund offset program.
    (1) Information submitted to the IRS shall include a description of:
    (i) The size and age of FEMA's inventory of delinquent debts;
    (ii) The prior collection efforts that the inventory reflects; and
    (iii) The quality controls FEMA maintains to assure that any debt 
that FEMA may submit for tax refund offset will be valid and 
enforceable.
    (2) In accordance with time limits established by the IRS, FEMA will 
submit test magnetic media to the IRS in such form and containing such 
data as the IRS may specify. FEMA may use the electronic data 
transmissions facilities of other federal agencies in transmitting test 
data or for referral of debts to the IRS.
    (d) FEMA shall establish a collect call or toll-free telephone 
number that the IRS will furnish to individuals whose refunds have been 
offset to obtain information from FEMA concerning the offsets taken.
    (e) Income tax refund offset procedures described in Secs. 11.61 
through 11.65 shall apply to debts owed the United States which are past 
due and legally enforceable; and
    (1) Except in the case of a judgment debt that has been delinquent 
for at least three months but has not been delinquent for more than ten 
years at the time the offset is made;
    (2) Cannot be currently collected pursuant to the Federal salary 
offset provisions of 5 U.S.C. 5524(a)(1);
    (3) Are ineligible for administrative offset under 31 U.S.C. 3716(a) 
by reason of 31 U.S.C. 3716(c)(2) or cannot be collected by FEMA using 
administrative offset under 31 U.S.C. 3716(a) against amounts payable to 
the debtor by or on behalf of FEMA;
    (4) With respect to which FEMA has given the taxpayer/debtor at 
least 65 days from the date of mailing of the notification (described in 
Sec. 11.63 of this part) to present evidence that all or part of the 
debt is not past due or legally enforceable, has considered evidence and 
reasons presented by such taxpayer/debtor and has determined that an 
amount of such debt is past due and legally enforceable;
    (5) Has been disclosed by FEMA to a consumer reporting agency as 
authorized by 31 U.S.C. 3711(f), unless the consumer reporting agency 
would be prohibited from using such information by 15 U.S.C. 1681c or 
unless the amount of the debt does not exceed $100.00;
    (6) With respect to which FEMA has notified or has made a reasonable 
attempt to notify the taxpayer/debtor that the debt is past due and, 
unless repaid within 65 days of the mailing of the notification, the 
debt will be referred to the IRS for offset against any overpayment of 
tax;
    (7) Is at least $25.00; and
    (8) Meets all other requirements of 31 U.S.C. 3720A and the 
Department of the Treasury regulations codified at 26 CFR 301.6402-6T 
relating to the eligibility of a debt for tax refund offset have been 
satisfied.

[57 FR 54715, Nov. 20, 1992]



Sec. 11.62  Administrative charges incurred in referrals for income tax refund offset.

    In accordance with 44 CFR 11.48(d), all administrative charges 
incurred in connection with the referral of the debts to the IRS shall 
be assessed on the debt and thus increase the amount of the offset. 
Assessed administrative charges will include, but not be limited to, a 
pro-rata share of charges made by the IRS in accordance with the IRS-
FEMA-MoU.

[57 FR 54716, Nov. 20, 1992]



Sec. 11.63  Notice to debtor before offset.

    A request for offset against an IRS tax refund will be made only 
after FEMA makes a determination that a debt is owed FEMA and, not less 
than 65 days prior to referring such debt to

[[Page 130]]

the IRS, provides a Notice of Intent to Use IRS Income Tax Refund Offset 
which will state that:
    (a) Debtor owes FEMA an amount due; and
    (b) The debt is past due; and
    (c) Unless the debt is repaid within 65 days of the date of FEMA's 
mailing, the Notice of Intent to use IRS Income Tax Refund Offset, FEMA 
intends to collect the debt by requesting the IRS to take offset to 
reduce a Federal tax refund by the amount of the debt and all 
accumulated interest and other charges; and
    (d) Debtor has an opportunity to present evidence, within 65 days of 
mailing of the Notice of Intent to Use IRS Income Tax Refund Offset, 
that all or a part of the debt is not due. A debtor wishing to present 
evidence shall send it to the Deputy Agency Collections Officer, Office 
of Financial Management, Federal Emergency Management Agency, 500 C 
Street, SW., Washington, DC 20472; and
    (e) Debtor may arrange to inspect and copy records relating to the 
debt by mailing a request to the Deputy Agency Collections Officer at 
the address above; and
    (f) If the debtor submits evidence described in paragraph (d) of 
this section then the debt shall not be referred to the IRS until such 
evidence is fully considered by the Agency Collections Officer (ACO). If 
no reply is received from the debtor within 65 days of mailing of the 
notice, FEMA may refer the debt to the IRS after reviewing the file and 
determining that the debt is due; and
    (g) The debt will be referred to the IRS only after the ACO, after 
reviewing the debt collection files and the debtor's evidence, if any, 
has determined that the debt is due. If the debtor has submitted 
evidence in accordance with paragraph (f) of this section, FEMA shall 
notify the debtor of the ACO's final determination.
    (h) If the debtor has questions concerning the debt or procedures 
being used, contact may be made with a specified FEMA employee whose 
work address and telephone will be provided in the Notice of Intent to 
Use IRS Income Tax Refund Offset.

[57 FR 54716, Nov. 20, 1992]



Sec. 11.64  Review within Federal Emergency Management Agency.

    (a) Notification by debtor. A debtor receiving Notice of Intent to 
Use IRS Income Tax Refund Offset has the right to present evidence and 
arguments within 65 days of mailing of the Notice of Intent to Use IRS 
Income Tax Refund Offset that all of the debt is not past-due or not 
legally enforceable. To exercise this right, the debtor must:
    (1) Send a written request for review of evidence to the Deputy 
Agency Collections Officer at the address provided in Sec. 11.63(d); and
    (2) State in the request the amount disputed and the reasons why the 
debtor believes that the debt is not past-due or is not legally 
enforceable; and
    (3) Include in the request any documents which the debtor wishes to 
be considered, or state that additional information will be submitted 
within the remainder of the 65-day period.
    (b) Submission of evidence. The debtor may submit evidence that all 
or part of the debt is not past-due or legally enforceable along with 
the notification required by paragraph (a) of this section. Failure to 
submit the notification and evidence within the 65-day period may result 
in a referral of the debt to the IRS with only a review by the ACO that 
the records show that the debt is actually due FEMA.
    (c) Review of the evidence. FEMA will consider all evidence, reasons 
and arguments submitted by the debtor, if any, relating to the debt. 
Within 30 days of receipt of debtor's evidence, if feasible, FEMA will 
notify the debtor whether FEMA has sustained, amended or canceled its 
determination that the debt is past-due or legally enforceable, in whole 
or in part.
    (1) Attached to the notification will be a written decision setting 
forth the supporting rationale for the determination.
    (2) FEMA will complete its review and determination and mail to the 
debtor the notification within 30 days of receipt of debtor's submission 
of evidence and arguments, if feasible.
    (3) The ACO may delegate his or her responsibilities in reviewing 
the files

[[Page 131]]

and evidence and for making determinations under this section to 
member(s) of his or her staff.

[57 FR 54716, Nov. 20, 1992]



Sec. 11.65  Stay of offset.

    If the debtor notifies FEMA that he or she is exercising rights 
described in Sec. 11.64 and submits evidence within time limits 
specified in Sec. 11.64(b), any notice to the IRS will be stayed until 
the issuance of a written decision which sustains or amends FEMA's 
original decision.

[57 FR 54717, Nov. 20, 1992]



                 Subpart D--Personnel Claims Regulations

    Authority: 31 U.S.C. 3721.

    Source: 50 FR 8112, Feb. 28, 1985.



Sec. 11.70  Scope and purpose.

    (a) The Director, Federal Emergency Management Agency (FEMA), is 
authorized by 31 U.S.C. 3721 to settle and pay (including replacement in 
kind) claims of officers and employees of FEMA, amounting to not more 
than $25,000 for damage to or loss of personal property incident to 
their service. Property may be replaced in-kind at the option of the 
Government. Claims are payable only for such types, quantities, or 
amounts of tangible personal property (including money) as the approving 
authority shall determine to be reasonable, useful, or proper under the 
circumstances existing at the time and place of the loss. In determining 
what is reasonable, useful, or proper, the approving authority will 
consider the type and quantity of property involved, circumstances 
attending acquisition and use of the property, and whether possession or 
use by the claimant at the time of damage or loss was incident to 
service.
    (b) The Government does not underwrite all personal property losses 
that a claimant may sustain and it does not underwrite individual 
tastes. While the Government does not attempt to limit possession of 
property by an individual, payment for damage or loss is made only to 
the extent that the possession of the property is determined to be 
reasonable, useful, or proper. If individuals possess excessive 
quantities of items, or expensive items, they should have such property 
privately insured. Failure of the claimant to comply with these 
procedures may reduce or preclude payment of the claim under this 
subpart.



Sec. 11.71  Claimants.

    (a) A claim pursuant to this subpart may only be made by: (1) An 
employee of FEMA; (2) a former employee of FEMA whose claim arises out 
of an incident occurring before his/her separation from FEMA; (3) 
survivors of a person named in paragraph (a) (1) or (2) of this section, 
in the following order of precedence: (i) Spouse; (ii) children; (iii) 
father or mother, or both or (iv) brothers or sisters, or both; (4) the 
authorized agent or legal representative of a person named in paragraphs 
(a) (1), (2), and (3) of this section.
    (b) A claim may not be presented by or for the benefit of a 
subrogee, assignee, conditional vendor, or other third party.



Sec. 11.72  Time limitations.

    (a) A claim under this part may be allowed only if it is in writing, 
specifies a sum certain and is received in the Office of General 
Counsel, Federal Emergency Management Agency, Washington, DC 20472: (1) 
Within 2 years after it accrues; (2) or if it cannot be filed within the 
time limits of paragraph (a)(1) of this section because it accrues in 
time of war or in time of armed conflict in which any armed force of the 
United States is engaged or if such a war or armed conflict intervenes 
within 2 years after the claim accrues, when the claimant shows good 
cause, the claim may be filed within 2 years after the cause ceases to 
exist but not more than 2 years after termination of the war or armed 
conflict.
    (b) For purposes of this subpart, a claim accrues at the time of the 
accident or incident causing the loss or damage, or at such time as the 
loss or damage should have been discovered by the claimant by the 
exercise of due diligence.



Sec. 11.73  Allowable claims.

    (a) A claim may be allowed only if: (1) The damage or loss was not 
caused

[[Page 132]]

wholly or partly by the negligent or wrongful act of the claimant, his/
her agent, the members of his/her family, or his/her private employee 
(the standard to be applied is that of reasonable care under the 
circumstances); and (2) the possession of the property lost or damaged 
and the quantity possessed is determined to have been reasonable, 
useful, or proper under the circumstances; and (3) the claim is 
substantiated by proper and convincing evidence.
    (b) Claims which are otherwise allowable under this subpart shall 
not be disallowed solely because the property was not in the possession 
of the claimant at the time of the damage or loss, or solely because the 
claimant was not the legal owner of the property for which the claim is 
made. For example, borrowed property may be the subject of a claim.
    (c) Subject to the conditions in paragraph (a) of this section, and 
the other provisions of this subpart, any claim for damage to, or loss 
of, personal property incident to service with FEMA may be considered 
and allowed. The following are examples of the principal types of claims 
which may be allowed, unless excluded by Sec. 11.74.
    (1) Property loss or damage in quarters or other authorized places. 
Claims may be allowed for damage to, or loss of, property arising from 
fire, flood, hurricane, other natural disaster, theft, or other unusual 
occurrence, while such property is located at:
    (i) Quarters within the 50 states or the District of Columbia that 
were assigned to the claimant or otherwise provided in-kind by the 
United States; or
    (ii) Any warehouse, office, working area, or other place (except 
quarters) authorized for the reception or storage of property.
    (2) Transportation or travel losses. Claims may be allowed for 
damage to, or loss of, property incident to transportation or storage 
pursuant to orders, or in connection with travel under orders, including 
property in the custody of a carrier, an agent or agency of the 
Government, or the claimant.
    (3) Motor vehicles. Claims may be allowed for automobiles and other 
motor vehicles damaged or lost by overseas shipments provided by the 
Government. ``Shipments provided by the Government'' means via 
Government vessels, charter of commercial vessels, or by Government 
bills of lading on commercial vessels, and includes storage, unloading, 
and offloading incident thereto. Other claims for damage to or loss of 
automobiles and other major vehicles may be allowed when use of the 
vehicles on a nonreimbursable basis was required by the claimant's 
supervisor, but these claims shall be limited to a maximum of $1,000.00.
    (4) Mobile homes. Claims may be allowed for damage to or loss of 
mobile homes and their content under the provisions of paragraph (c)(2) 
of this section. Claims for structural damage to mobile homes resulting 
from such structural damage must contain conclusive evidence that the 
damage was not caused by structural deficiency of the mobile home and 
that it was not overloaded. Claims for damage to or loss of tires 
mounted on mobile homes may be allowed only in cases of collision, 
theft, or vandalism.
    (5) Money. Claims for money in an amount that is determined to be 
reasonable for the claimant to possess at the time of the loss are 
payable:
    (i) Where personal funds were accepted by responsible Government 
personnel with apparent authority to receive them for safekeeping, 
deposit, transmittal, or other authorized disposition, but were neither 
applied as directed by the owner nor returned;
    (ii) When lost incident to a marine or aircraft disaster;
    (iii) When lost by fire, flood, hurricane, or other natural 
disaster;
    (iv) When stolen from the quarters of the claimant where it is 
conclusively shown that the money was in a locked container and that the 
quarters themselves were locked. Exceptions to the foregoing ``double 
lock'' rule are permitted when the adjudicating authority determines 
that the theft loss was not caused wholly or partly by the negligent or 
wrongful act of the claimant, their agent, or their employee. The 
adjudicating authority should use the test of whether the claimant did 
their best under the circumstances to protect the property; or

[[Page 133]]

    (v) When taken by force from the claimant's person.
    (6) Clothing. Claims may be allowed for clothing and accessories 
customarily worn on the person which are damaged or lost:
    (i) During the performance of official duties in an unusual or 
extraordinary-risk situation;
    (ii) In cases involving emergency action required by natural 
disaster such as fire, flood, hurricane, or by enemy or other 
belligerent action;
    (iii) In cases involving faulty equipment or defective furniture 
maintained by the Government and used by the claimant required by the 
job situation; or
    (iv) When using a motor vehicle.
    (7) Property used for benefit of the Government. Claims may be 
allowed for damage to or loss of property (except motor vehicles, see 
Secs. 11.73(c)(3) and 11.74(b)(13)) used for the benefit of the 
Government at the request of, or with the knowledge and consent of, 
superior authority or by reason of necessity.
    (8) Enemy action or public service. Claims may be allowed for damage 
to or loss of property as a direct consequence of:
    (i) Enemy action or threat thereof, or combat, guerrilla, 
brigandage, or other belligerent activity, or unjust confiscation by a 
foreign power or its nation:
    (ii) Action by the claimant to quiet a civil disturbance or to 
alleviate a public disaster; or
    (iii) Efforts by the claimant to save human life or Government 
property.
    (9) Marine or aircraft disaster. Claims may be allowed for personal 
property damaged or lost as a result of marine or aircraft disaster or 
accident.
    (10) Government property. Claims may be allowed for property owned 
by the United States only when the claimant is financially responsible 
to an agency of the Government other than FEMA.
    (11) Borrowed property. Claims may be allowed for borrowed property 
that has been damaged or lost.
    (12)(i) A claim against the Government may be made for not more than 
$40,000 by an officer or employee of the agency for damage to, or loss 
of, personal property in a foreign country that was incurred incident to 
service, and--
    (A) The officer, or employee was evacuated from the country on a 
recommendation or order of the Secretary of State or other competent 
authority that was made in responding to an incident of political unrest 
or hostile act by people in that country; and the damage or loss 
resulted from the evacuation, incident, or hostile act; or
    (B) The damage or loss resulted from a hostile act directed against 
the Government or its officers, or employees.
    (ii) On paying the claim under this section, the Government is 
subrogated for the amount of the payment to a right or claim that the 
claimant may have against the foreign country for the damage or loss for 
which the Government made the payment.
    (iii) Amounts may be obligated or expended for claims under this 
section only to the extent provided in advance in appropriation laws.



Sec. 11.74  Claims not allowed.

    (a) A claim is not allowable if:
    (1) The damage or loss was caused wholly or partly by the negligent 
or wrongful act of the claimant, claimant's agent, claimant's employee, 
or a member of claimant's family;
    (2) The damage or loss occurred in quarters occupied by the claimant 
within the 50 states and the District of Columbia that were not assigned 
to the claimant or otherwise provided in-kind by the United States;
    (3) Possession of the property lost or damaged was not incident to 
service or not reasonable or proper under the circumstances.
    (b) In addition to claims falling within the categories of paragraph 
(a) of this section, the following are examples of claims which are not 
payable:
    (1) Claims not incident to service. Claims which arose during the 
conduct of personal business are not payable.
    (2) Subrogation claims. Claims based upon payment or other 
consideration to a proper claimant are not payable.
    (3) Assigned claims. Claims based upon assignment of a claim by a 
proper claimant are not payable.
    (4) Conditional vendor claims. Claims asserted by or on behalf of a 
conditional vendor are not payable.

[[Page 134]]

    (5) Claims by improper claimants. Claims by persons not designated 
in Sec. 11.71 are not payable.
    (6) Articles of extraordinary value. Claims are not payable for 
valuable or expensive articles, such as cameras, watches, jewelry, furs, 
or other articles of extraordinary value, when shipped with household 
goods or as unaccompanied baggage (shipment includes storage). This 
prohibition does not apply to articles in the personal custody of the 
claimant or articles properly checked, provided that reasonable 
protection or security measures have been taken, by the claimant.
    (7) Articles acquired for other persons. Claims are not payable for 
articles intended directly or indirectly for persons other than the 
claimant or members of the claimants' immediate household. This 
prohibition includes articles acquired at the request of others and 
articles for sale.
    (8) Property used for business. Claims are not payable for property 
normally used for business or profit.
    (9) Unserviceable property. Claims are not payable for wornout or 
unserviceable property.
    (10) Violation of law or directive. Claims are not payable for 
property acquired, possessed, or transported in violation of law, 
regulation, or other directive. This does not apply to limitation 
imposed on the weight of shipments of household goods.
    (11) Intangible property. Claims are not payable for intangible 
property such as bank books, checks, promissory notes, stock 
certificates, bonds, bills of lading, warehouse receipts, baggage 
checks, insurance policies, money orders, and traveler's checks.
    (12) Government property. Claims are not payable for property owned 
by the United States unless the claimant is financially responsible for 
the property to an agency of the Government other than FEMA.
    (13) Motor vehicles. Claims for motor vehicles, except as provided 
for by Sec. 11.73(c)(3), will ordinarily not be paid. However, in 
exceptional cases, meritorious claims for damage to or loss of motor 
vehicles, limited to a maximum of $1,000.00, may be recommended to the 
Office of General Counsel for consideration and approval for payment.
    (14) Enemy property. Claims are not payable for enemy property, 
including war trophies.
    (15) Losses recoverable from carrier, insurer or contractor. Claims 
are not payable for losses, or any portion thereof, which have been 
recovered or are recoverable from a carrier, insurer or under contract 
except as permitted under Sec. 11.75.
    (16) Fees for estimates. Claims are not normally payable for fees 
paid to obtain estimates of repair in conjunction with submitting a 
claim under this subpart. However, where, in the opinion of the 
adjudicating authority, the claimant could not obtain an estimate 
without paying a fee, such a claim may be considered in an amount 
reasonable in relation to the value for the cost of repairs of the 
articles involved, provided that the evidence furnished clearly 
indicates that the amount of the fee paid will not be deducted from the 
cost of repairs if the work is accomplished by the estimator.
    (17) Items fraudulently claimed. Claims are not payable for items 
fraudulently claimed. When investigation discloses that a claimant, 
claimant's agent, claimant's employee, or member of claimant's family 
has intentionally misrepresented an item claimed as to cost, condition, 
costs to repair, etc., the item will be disallowed in its entirety even 
though some actual damage has been sustained. However, if the remainder 
of the claim is proper, it may be paid. This does not preclude 
appropriate disciplinary action if warranted.
    (18) Minimum amount. Loss or damage amounting to less than $10.



Sec. 11.75  Claims involving carriers and insurers.

    In the event the property which is the subject of a claim was lost 
or damaged while in the possession of a carrier or was insured, the 
following procedures will apply:
    (a) Whenever property is damaged, lost, or destroyed while being 
shipped pursuant to authorized travel orders, the owner must file a 
written claim for reimbursement with the last commercial carrier known 
or believed to have handled the goods, or the carrier known to be in 
possession of the property when the damage or loss occurred,

[[Page 135]]

according to the terms of its bill of lading or contract, before 
submitting a claim against the Government under this subpart.
    (1) If more than one bill of lading or contract was issued, a 
separate demand should be made against the last carrier on each such 
document.
    (2) The demand should be made within the time limit provided in the 
policy and prior to the filing of a claim against the Government.
    (3) If it is apparent that the damage or loss is attributable to 
packing, storage, or unpacking while in the custody of the Government, 
no demand need be made against the carrier.
    (b) Whenever property which is damaged, lost, or destroyed incident 
to the claimant's service is insured in whole or in part, the claimant 
must make demand in writing against the insurer for reimbursement under 
terms and conditions of the insurance coverage, prior to the filing of 
the concurrent claim against the Government.
    (c) Failure to make a demand on a carrier or insurer or to make all 
reasonable efforts to protect and prosecute rights available against a 
carrier or insurer and to collect the amount recoverable from the 
carrier or insurer may result in reducing the amount recoverable from 
the Government by the maximum amount which would have been recoverable 
from the carrier or insurer, had the claim been timely or diligently 
prosecuted. However, no deduction will be made where the circumstances 
of the claimant's service preclude reasonable filing of such a claim or 
diligent prosecution, or the evidence indicates a demand was 
impracticable or would have been unavailing.
    (d) Following the submission of the claim against the carrier or 
insurer, the claimant may immediately submit a claim against the 
Government in accordance with the provisions of this subpart, without 
waiting until either final approval or denial of the claim is made by 
the carrier or insurer.
    (1) Upon submission of a claim to the Government, the claimant must 
certify in the claim that no recovery (or the amount of recovery) has 
been gained from a carrier or insurer, and enclose all correspondence 
pertinent thereto.
    (2) If the carrier or insurer has not taken final action on the 
claim against them, by the time the claimant submits a claim to the 
Government, the claimant will immediately notify them to address all 
correspondence in regard to the claim to him/her, in care of the General 
Counsel of FEMA.
    (3) The claimant shall timely advise the General Counsel in writing, 
of any action which is taken by the carrier or insurer on the claim. On 
request, the claimant also will furnish such evidence as may be required 
to enable the United States to enforce the claim.
    (e) When a claim is paid by FEMA, the claimant will assign to the 
United States, to the extent of any payment on the claim accepted by 
claimant, all rights, title, and interest in any claim against the 
carrier, insurer, or other party arising out of the incident on which 
the claim against the Government is based. After payment of the claim by 
the Government, the claimant will, upon receipt of any payment from a 
carrier or insurer, pay the proceeds to the United States to the extent 
of the payment received by the claimant from the United States.
    (f) When a claimant recovers for the loss from the carrier or 
insurer before the claim against the Government under this subpart is 
settled, the amount or recovery shall be applied to the claim as 
follows:
    (1) When the amount recovered from a carrier, insurer, or other 
third party is greater than or equal to the claimant's total loss as 
determined under this subpart, no compensation is allowable under this 
subpart.
    (2) When the amount recovered is less than such total loss, the 
allowable amount is determined by deducting the recovery from the amount 
of such total loss;
    (3) For the purpose of this paragraph (f) the claimant's total loss 
is to be determined without regard to the $25,000 maximum set forth 
above. However, if the resulting amount, after making this deduction, 
exceeds $25,000, the claimant will be allowed only $25,000.



Sec. 11.76  Claims procedures.

    (a) Filing a claim. Applicants shall file claims in writing with the 
General

[[Page 136]]

Counsel, Federal Emergency Management Agency, Washington, DC 20472. Each 
written claim shall contain, as a minimum:
    (1) Name, address, and place of employment of the claimant;
    (2) Place and date of the damage or loss:
    (3) A brief statement of the facts and circumstances surrounding the 
damage or loss;
    (4) Cost, date, and place of acquisition of each price of property 
damaged or lost;
    (5) Two itemized repair estimates, or value estimates, whichever is 
applicable;
    (6) Copies of police reports, if applicable;
    (7) A statement from the claimant's supervisor that the loss was 
incident to service;
    (8) A statement that the property was or was not insured;
    (9) With respect to claims involving thefts or losses in quarters or 
other places where the property was reasonably kept, a statement as to 
what security precautions were taken to protect the property involved;
    (10) With respect to claims involving property being used for the 
benefit of the Government, a statement by the claimant's supervisor that 
the claimant was required to provide such property or that the 
claimant's providing it was in the interest of the Government; and
    (11) Other evidence as may be required.
    (b) Single claim. A single claim shall be presented for all lost or 
damaged property resulting from the same incident. If this procedure 
causes a hardship, the claimant may present an initial claim with notice 
that it is a partial claim, an explanation of the circumstances causing 
the hardship, and an estimate of the balance of the claim and the date 
it will be submitted. Payment may be made on a partial claim if the 
adjudicating authority determines that a genuine hardship exists.
    (c) Loss in quarters. Claims for property loss in quarters or other 
authorized places should be accompanied by a statement indicating:
    (1) Geographical location;
    (2) Whether the quarters were assigned or provided in-kind by the 
Government;
    (3) Whether the quarters are regularly occupied by the claimant;
    (4) Names of the authority, if any, who designated the place of 
storage of the property if other than quarters;
    (5) Measures taken to protect the property; and
    (6) Whether the claimant is a local inhabitant.
    (d) Loss by theft or robbery. Claims for property loss by theft or 
robbery should be accompanied by a statement indicating:
    (1) Geographical location;
    (2) Facts and circumstances surrounding the loss, including evidence 
of the crime such as breaking and entering, capture of the thief or 
robber, or recovery of part of the stolen goods; and
    (3) Evidence that the claimant exercised due care in protecting the 
property prior to the loss, including information as to the degree of 
care normally exercised in the locale of the loss due to any unusual 
risks involved.
    (e) Transportation losses. Claims for transportation losses should 
be accompanied by the following:
    (1) Copies of orders authorizing the travel, transportation, or 
shipment or a certificate explaining the absence of orders and stating 
their substance;
    (2) Statement in cases where property was turned over to a shipping 
officer, supply officer, or contract packer indicating:
    (i) Name (or designation) and address of the shipping officer, 
supply officer, or contract packer indicating;
    (ii) Date the property was turned over;
    (iii) Inventoried condition when the property was turned over;
    (iv) When and where the property was packed and by whom;
    (v) Date of shipment;
    (vi) Copies of all bills of lading, inventories, and other 
applicable shipping documents;
    (vii) Date and place of delivery to the claimant;
    (viii) Date the property was unpacked by the carrier, claimant, or 
Government;

[[Page 137]]

    (ix) Statement of disinterested witnesses as to the condition of the 
property when received and delivered, or as to handling or storage;
    (x) Whether the negligence of any Government employee acting within 
the scope of his/her employment caused the damage or loss;
    (xi) Whether the last common carrier or local carrier was given a 
clear receipt, except for concealed damages;
    (xii) Total gross, tare, and new weight of shipment;
    (xiii) Insurance certificate or policy if losses are privately 
insured;
    (xiv) Copy of the demand on carrier or insured, or both, when 
required, and the reply, if any;
    (xv) Action taken by the claimant to locate missing baggage or 
household effects, including related correspondence.
    (f) Marine or aircraft disaster. Claims for property losses due to 
marine or aircraft disaster should be accompanied by a copy of orders or 
other evidence to establish the claimant's right to be, or to have 
property on board.
    (g) Enemy action, public disaster, or public service. Claims for 
property losses due to enemy action, public disaster, or public service 
should be accompanied by:
    (1) Copies of orders or other evidence establishing the claimant's 
required presence in the area involved; and
    (2) A detailed statement of facts and circumstances showing an 
applicable case enumerated in Sec. 11.73(c)(8).
    (h) Money. Claims for loss of money deposited for safekeeping, 
transmittal, or other authorized disposition should be accompanied by:
    (1) Name, grade, and address of the person or persons who received 
money and any others involved;
    (2) Name and designation of the authority who authorized such person 
or persons to accept personal funds and the disposition required; and
    (3) Receipts and written sworn statements explaining the failure to 
account for funds or return them to the claimant.
    (i) Motor vehicles or mobile homes in transit. Claims for damage to 
motor vehicles or mobile homes in transit should be accompanied by a 
copy of orders or other available evidence to establish the claimant's 
lawful right to have the property shipped and evidence to establish 
damage in transit.



Sec. 11.77  Settlement of claims.

    (a) The General Counsel, FEMA, is authorized to settle (consider, 
ascertain, adjust, determine, and dispose of, whether by full or partial 
allowance or disallowance) any claim under this subpart.
    (b) The General Counsel may formulate such procedures and make such 
redelegations as may be required to fulfill the objectives of this 
subpart.
    (c) The General Counsel shall conduct or request the Office of 
Inspector General to conduct such investigation as may be appropriate in 
order to determine the validity of a claim.
    (d) The General Counsel shall notify a claimant in writing of action 
taken on their claim, and if partial or full disallowance is made, the 
reasons therefor.
    (e) In the event a claim submitted against a carrier under 
Sec. 11.75 has not been settled, before settlement of the claim against 
the Government pursuant to this subpart, the General Counsel shall 
notify such carrier or insurer to pay the proceeds of the claim to FEMA 
to the extent FEMA has paid such to claimant in settlement.
    (f) The settlement of a claim under this subpart, whether by full or 
partial allowance or disallowance, is final and conclusive.



Sec. 11.78  Computation of amount of award.

    (a) The amount allowed for damage to or loss of any items of 
property may not exceed the cost of the item (either the price paid in 
cash or property, or the value at the time of acquisition if not 
acquired by purchase or exchange), and there will be no allowance for 
replacement cost or for appreciation in the value of the property. 
Subject to these limitations, the amount allowable is either:
    (1) The depreciated value, immediately prior to the loss or damage, 
of property lost or damaged beyond economical repair, less any salvage 
value; or

[[Page 138]]

    (2) The reasonable cost or repairs, when property is economically 
repairable, provided that the cost of repairs does not exceed the amount 
allowable under paragraph (a)(1) of this section.
    (b) Depreciation in value is determined by considering the type of 
article involved, its costs, its conditions when damaged or lost, and 
the time elapsed between the date of acquisition and the date of damage 
or loss.
    (c) Replacement of lost or damaged property may be made in-kind 
whenever appropriate.



Sec. 11.79  Attorney's fees.

    No more than 10 per centum of the amount paid in settlement of each 
individual claim submitted and settled under this subpart shall be paid 
or delivered to or received by any agent or attorney on account of 
services rendered in connection with that claim. A person violating this 
section shall be fined not more than $1,000.

(Information collection approved by Office of Management and Budget 
under Control No. 3067-0167)



PART 12--ADVISORY COMMITTEES--Table of Contents




Sec.
12.1  Purpose and applicability.
12.2  Definitions.
12.3  Policy.
12.4  Interpretations.
12.5  Advisory committee management officer.
12.6  Establishment of advisory committees.
12.7  Charter.
12.8  Meetings.
12.9  Closed meetings.
12.10  Designated Federal officer or employee.
12.11  Public notice.
12.12  Minutes.
12.13  Transcripts of the advisory committee meetings and agency 
          proceedings.
12.14  Annual comprehensive review.
12.15  Termination and renewal of advisory committees.
12.16  Reports about the advisory committees.
12.17  Availability of documents and information on advisory committees.
12.18  Uniform pay guidelines.
12.19  Fiscal and administrative responsibilities.

    Authority: Federal Advisory Committee Act, 5 U.S.C. app. 1; 
Reorganization Plan No. 3 of 1978; E.O. 12127; E.O. 12148; E.O. 12024.

    Source: 45 FR 64180, Sept. 29, 1980, unless otherwise noted.



Sec. 12.1  Purpose and applicability.

    (a) The regulations in this part implement the Federal Advisory 
Committee Act, Executive Order 12024 and General Services Administration 
Regulation 41 CFR part 101-6. The provisions of the Federal Advisory 
Committee Act in this part shall apply to all advisory committees 
established by the Federal Emergency Management Agency (FEMA), including 
advisory committees created pursuant to any act of Congress relating to 
the United States Fire Administration, Federal Insurance Administration, 
or any other component of the Federal Emergency Management Agency, 
except to the extent that any act of Congress establishing an advisory 
committee reporting to the agencies specifically provides otherwise.
    (b) This part does not apply to inter-agency advisory committees or 
advisory committees established by the President unless specifically 
made applicable by the establishing authority.
    (c) This part does not apply to any local group, contractor, 
grantee, or other organization whose primary function is to render 
public service with respect to a Federal program, or any state or local 
committee, counsel, board, commission, or similar group established to 
advise or make recommendations to State or local officials or agencies.

[45 FR 64180, Sept. 29, 1980, as amended at 48 FR 44543, Sept. 29, 1983; 
50 FR 40007, Oct. 1, 1985]



Sec. 12.2  Definitions.

    As used in this part--
    Act means the Federal Advisory Committee Act (86 Stat. 770).
    Advisory Committee is used as per the meaning set forth in section 
3(2) of the Act.
    Agency means the Federal Emergency Management Agency, established by 
Presidential Reorganization Plan No. 3 of 1978, or any component 
thereof.
    Administrator, GSA means the Administrator of General Services.
    Director means the Director of the Federal Emergency Management 
Agency.

[[Page 139]]

    FEMA means the Federal Emergency Management Agency.
    GSA means the General Services Administration.
    Presidential Advisory Committee means an advisory committee which 
advises the President of the United States.
    Secretariat means the Committee Management Secretariat of the 
General Services Administration.
    Any officer of the Federal Government means any agency official or 
employee of the Federal government designated to perform duties with 
respect to an advisory committee established under this part.
    Nonstatutory advisory committee means an advisory committee not 
established by statute or reorganization plan.



Sec. 12.3  Policy.

    In determining whether an advisory committee should be created, and 
in reviewing the functions of operating advisory committees, the Agency 
will:
    (a) Establish new advisory committees only when they are determined 
to be essential, keeping their number to the minimum necessary to 
accomplish the assigned mission of the agency or its components;
    (b) Provide standards and uniform procedures to govern the 
establishment, operation, administration, and duration of the advisory 
committees;
    (c) Terminate the advisory committees when they are no longer 
necessary to carry out the purposes for which they were established; and
    (d) Keep the Congress and the public informed with respect to the 
number, purpose, membership, activity, and cost of the advisory 
committees.



Sec. 12.4  Interpretations.

    Except as specifically authorized in writing by the Director, 
including internal instructions, no interpretation of the meaning of the 
regulations in this part by any employee or officer of the Agency, other 
than a written interpretation by the General Counsel, will be recognized 
to be binding upon the Agency.



Sec. 12.5  Advisory committee management officer.

    (a) The Director will designate as advisory committee management 
officer the Chief, Staff Planning and Evaluation, Office of 
Administrative Support, who shall:
    (1) Exercise control and supervision over the establishment, 
procedures, and accomplishments of the advisory committees established 
by the Director; and
    (2) Assemble and maintain the reports, records, and other papers of 
any advisory committee during its existence.
    (b) The name of the Advisory Committee Management Officer designated 
in accordance with this part shall be provided to the Secretariat.

[45 FR 64180, Sept. 29, 1980, as amended at 47 FR 13149, Mar. 29, 1982; 
48 FR 44543, Sept. 29, 1983; 49 FR 33879, Aug. 27, 1984]



Sec. 12.6  Establishment of advisory committees.

    (a) No advisory committee shall be established under this part 
unless such establishment is:
    (1) Specifically authorized by statute or the President of the 
United States; or
    (2) Determined as a matter of formal record by the Director after 
consultation with the Secretariat, with timely notice published in the 
Federal Register as a matter of the public interest, in connection with 
the performance of duties imposed on the agency by law.
    (b) The determination required by paragraph (a)(2) of this section 
shall:
    (1) Contain a clearly defined purpose for the advisory committee;
    (2) Require the membership of the advisory committee to be fairly 
balanced in terms of the points of view represented in the functions 
performed by the advisory committee;
    (3) Contain appropriate provisions to assure that the advice and 
recommendations of the advisory committee will not be inappropriately 
influenced by the appointing authority or by any special interest, but 
will instead be the result of the advisory committee's independent 
judgment;
    (4) Contain provisions dealing with the date for submission of 
reports (if any), the duration of the advisory committee, and the 
publication of reports and other materials, to the extent that the 
agency determines the provisions

[[Page 140]]

of Sec. 12.16 of this part to be inadequate; and
    (5) Contain provisions which will assure that the advisory committee 
will have adequate staff (either supplied by the Agency or employed by 
it), will be provided adequate quarters, and will have funds available 
to meet its other necessary expenses.
    (c) Consultation with the Secretariat may be in the form of a letter 
from the Agency describing the nature and purpose of the proposed 
advisory committee, including an explanation of why the functions of the 
proposed committee could not be performed by FEMA or by an existing 
committee. The letter should describe the Agency's plan to attain 
balanced membership on the proposed committee, as prescribed in 
paragraph (b)(2) of this section. If the Secretariat is satisfied that 
the establishment of the advisory committee will be in accord with the 
Act, the Agency shall certify in writing that creation of the advisory 
committee is in the public interest.
    (d) Unless otherwise specifically provided by statute or 
Presidential directive, advisory committees shall be utilized solely for 
advisory functions.



Sec. 12.7  Charter.

    (a) No advisory committee established under this part shall meet or 
take any action until an advisory committee charter has been filed with 
the Agency and the standing Committee or Committees of the Senate and 
House of Representatives having legislative jurisdiction over the FEMA 
component to which the advisory committee renders its advice.
    (b) The charter required by paragraph (a) of this section shall 
contain at least the following information:
    (1) The committee's official designations;
    (2) The committee's objectives and the scope of its activities;
    (3) The period of time necessary for the committee to carry out its 
purposes;
    (4) The FEMA component and official to whom the committee reports;
    (5) The FEMA component responsible for providing the necessary 
support for the committee;
    (6) A description of the duties for which the committee is 
responsible, and, if such duties are not solely advisory, specification 
of the authority for such functions;
    (7) The estimated annual operating cost in dollars and man years for 
the committee;
    (8) The estimated number in frequency of committee meetings;
    (9) The committee's termination date, if less than 2 years from the 
date of committee's establishment; and
    (10) The date the charter is filed.
    (c) A copy of the charter required by paragraph (a) of this section 
shall also be furnished at the time of filing to the Library of 
Congress, Exchange and Gift Division, Federal Advisory Committee, 
Washington, DC 20540.
    (d) An amendment to the charter may be filed whenever there is a 
substantial change regarding matters stated in the original charter.
    (e) The requirements of this section shall also apply to committees 
utilized as advisory committees, even though not expressly established 
for that purpose.



Sec. 12.8  Meetings.

    (a) Advisory committees established under this part shall not hold 
any meetings, nor shall they render any advice, except at the call of, 
or with the advice and approval of, the Federal Officer or employee 
designated in accordance with Sec. 12.10 of this part, who shall also 
approve the agenda of such meetings. Timely notice of each meeting shall 
be provided in accordance with Sec. 12.11 of this part.
    (b) The agenda required by paragraph (a) of this section shall list 
the matters to be considered at the meeting. It shall also indicate when 
any part of the meeting will concern matters within the exceptions of 
the (Government) Sunshine Act, 5 U.S.C. 552b, and Sec. 12.9 of this 
part.
    (c) Subject to the provisions of Sec. 12.9 of this part, each 
advisory committee meeting shall be open to the public. Meetings which 
are completely or partly open to the public shall be held at reasonable 
times and at such a place that is reasonably accessible to the public. 
The size of the meeting room should be determined by such factors

[[Page 141]]

as the size of the committee, the number of members of the public who 
could reasonably be expected to attend, the number of persons who 
attended similar meetings in the past, and the resource facilities 
available.
    (d) Any member of the public shall be permitted to file a written 
statement with the committee related to any meeting that is completely 
or partly open to the public. Interested persons may also be permitted 
by the committee chairman to speak at such meetings in accordance with 
the procedures established by the committee.



Sec. 12.9  Closed meetings.

    (a) The requirements of Sec. 12.8 (c) and (d) of this part that 
meetings shall be open to the public and that the public shall be 
afforded an opportunity to participate in such meetings shall not apply 
to any advisory committee meeting which the President or the Director 
determines is concerned with matters listed in 5 U.S.C. 552b(c).
    (b) An advisory committee which seeks to have all or part of its 
meetings closed shall notify the Director before the scheduled date of 
the meeting. The notification shall be in writing and shall specify the 
reasons why any part of the meeting should be closed.
    (c) A request that the meeting be closed will be granted upon 
determination by the Director that the request is in accordance with the 
policies of this part. The Director's determination will be in writing 
and will state the specific reasons for closing all or part of the 
meeting. The determination will be made available to the public upon 
request.
    (d) The Director may delegate responsibility for making the 
determination required by paragraph (c) of this section. In any case 
where the determination to close the meeting is made by the Director's 
delegate, the determination will be reviewed by the General Counsel.
    (e) When a meeting is closed to the public, the advisory committee 
shall issue a report, at least annually, setting forth a summary of its 
activities in such meetings, addressing those related matters as would 
be informative to the public and consistent with the policy of 5 U.S.C. 
552b(c) and of this part. Notice of the availability of such annual 
reports shall be published in accordance with Sec. 12.11 of this part.



Sec. 12.10  Designated Federal officer or employee.

    (a) The Agency will designate an officer or employee of the Federal 
Government to chair or attend each meeting of each advisory committee 
established under this part.
    (b) No advisory committee shall conduct any meeting in the absence 
of the Federal employee or officer designated in accordance with 
paragraph (a) of this section.
    (c) The Federal officer or employee designated in accordance with 
paragraph (a) of this section is authorized, whenever he/she determines 
it to be in the public interest, to adjourn any committee meeting he/she 
is designated to chair or attend.



Sec. 12.11  Public notice.

    (a) The Agency's determination procedure described by Sec. 12.6 of 
this part for the creation of the advisory committee, and a description 
of the nature and purpose of the committee, should be published in the 
Federal Register at least 15 days prior to the filing of the committee's 
charter, unless the Secretariat, for good cause, authorizes a shorter 
period of time between publication of the notice and the filing of the 
charter.
    (b) Except when the Administrator GSA determines contrarily for 
reasons of national security, timely notice of each advisory committee 
meeting, whether open or closed to the public, shall be published in the 
Federal Register at least 15 days before the meeting date. Such notice 
should state the name of the advisory committee, the time, place and 
purpose of the meeting, and should include, where appropriate, a summary 
of the meeting agenda. Notice ordinarily should state that the meeting 
is open to the public or explain why the meeting or any portion of the 
meeting is to be closed. Notices shorter than the time prescribed by 
this paragraph may be provided in emergency situations, and the reasons 
for such emergency exceptions should be made part of the meeting notice. 
Due to the emergency nature of FEMA's

[[Page 142]]

many programs, it is contemplated that advisory committees may have to 
be established or meetings called on fairly short notice; however, every 
effort should be made to comply with the notice requirement, except in 
cases where delay may result in harm to individuals or damage to 
property. A request for a determination that notice of a meeting should 
not be published for reasons of national security shall be submitted to 
the Administrator GSA with a statement of reasons supporting such 
request at least 30 days before the meeting is scheduled. Where, 
however, there is a significant likelihood of severe damage to property 
or injury to individuals, the notice period may be reduced as necessary 
to minimize such damage or injury.
    (c) In addition to the notice required by paragraph (b) of this 
section, other forms of notice such as public releases and notices by 
mail should be used to inform the public of advisory committee meetings.
    (d) The Committee Management Officer, in coordination with the 
Office of Public Affairs, should, where practical, maintain lists of 
people and organizations interested in advisory committees and notify 
them of meetings by mail.
    (e) Notice of the availability of the annual reports required by 
Sec. 12.9(e) of this part will be published in the Federal Register no 
later than 60 days after their completion. Notice will include 
instructions which will allow the public access to the reports.



Sec. 12.12  Minutes.

    (a) Detailed minutes of each advisory committee meeting shall be 
kept and shall contain a record of the persons present, a complete 
summary of matters discussed and conclusions reached, and copies of all 
reports received, issued, or approved by the advisory committee. The 
record of persons present shall include the time and place of the 
meeting, a list of advisory committee members and staff and agency 
employees present at the meeting, a list of members of the public who 
presented oral or written statements, and an estimated number of members 
of the public who attended the meeting. The minutes shall describe the 
extent to which the meeting was open to the public and the extent of 
public participation. If it is impracticable to attach to the minutes of 
the meeting any report received, issued, or approved by the advisory 
committee, then the minutes will describe the report in sufficient 
detail to enable any person requesting the report to readily identify 
it.
    (b) The accuracy of all minutes shall be certified by the 
chairperson of the advisory committee concerned, except in the case of a 
subcommittee or subgroup of the advisory committee, in which case the 
accuracy of the minutes shall be certified by the chairperson of the 
subcommittee or subgroup concerned and co-signed by the chairperson of 
the advisory committee.



Sec. 12.13  Transcripts of the advisory committee meetings and agency proceedings.

    Copies of transcripts of advisory committee meetings which have been 
prepared will be made available to any person at the actual cost of 
duplication, as prescribed in Sec. 12.17 of this part.



Sec. 12.14  Annual comprehensive review.

    (a) The Agency will conduct an annual comprehensive review of the 
activities and responsibilities of each advisory committee to determine:
    (1) Whether such committee is carrying out its purpose;
    (2) Whether, consistent with the provisions of applicable statutes, 
the responsibilities assigned to it should be revised;
    (3) Whether it should be merged with any other advisory committee or 
committees; or
    (4) Whether it should be abolished.
    (b) Pertinent factors to be considered in the comprehensive review 
required by paragraph (a) of this section includes the following:
    (1) The number of times the committee has met in the past year;
    (2) The number of reports or recommendations submitted by the 
committee;
    (3) An evaluation of the substance of the reports or recommendations 
submitted by the committee, regarding the Agency's programs or 
operations;

[[Page 143]]

    (4) An evaluation of the utilization by the Agency of the 
committee's policy formation recommendations in: program planning, 
decision making, more effective achievement of program objectives, and 
more economical accomplishment of programs in general, with emphasis in 
such evaluation on the preceding 12 month period of the committee's 
work;
    (5) Whether information or recommendations could be obtained from 
sources within the Agency or from other advisory committees already in 
existence;
    (6) The degree of duplication of effort by the committee as compared 
with that of other parts of the Agency or other advisory committees; and
    (7) The estimated annual cost of the committee.
    (c) The annual review required by this section shall be conducted on 
a calendar year basis, and results of the review shall be included in 
the annual report to the Secretariat required by Sec. 12.16(b) of this 
part. The report shall contain a justification of each advisory 
committee which the Agency determines should be continued, making 
reference, as appropriate, to the factors specified in paragraph (b) of 
this section.
    (d) The review will examine all advisory committees, and committees 
found to be no longer needed shall be terminated. Advisory committees 
established by act of Congress or the President of the United States 
will be reviewed, and if appropriate, their termination will be 
recommended.



Sec. 12.15  Termination and renewal of advisory committees.

    (a) Each advisory committee shall terminate not later than the 
expiration of the 2 year period beginning on the date of its 
establishment, unless:
    (1) In the case of an advisory committee established by the 
President or an officer of the Federal Government, such advisory 
committee is renewed by the President or such officer by appropriate 
action prior to the end of such period; or
    (2) In the case of an advisory committee established by an Act of 
Congress, its duration is otherwise provided by law.
    (b) Any advisory committee which is renewed by the President or any 
officer of the Federal Government may be continued only for successive 
2-year periods by appropriate action taken by the President or such 
officer prior to the date on which the advisory committee would 
otherwise terminate.
    (c) Before it renews a non-statutory advisory committee in 
accordance with paragraph (a) or (b) of this section, the Agency will 
inform the Secretariat by letter, not more than 60 days nor less than 30 
days before the committee expires, of the following:
    (1) Its determination that a renewal is necessary and is in the 
public interest;
    (2) The reasons for its determination;
    (3) The Agency's plan to attain balanced membership on the 
committee;
    (4) An explanation of why the committee's functions cannot be 
performed by the Agency or by an existing advisory committee.
    (d) After concurrence by the Secretariat, the Agency will certify in 
writing that the renewal of the advisory committee is in the public 
interest, and will publish a notice of the renewal in the Federal 
Register, and will file a new charter in accordance with Sec. 12.7 of 
this part.
    (e) Any advisory committee established by an Act of Congress shall 
file a charter in accordance with Sec. 12.7 of this part upon the 
expiration of each successive 2-year period following the date of 
enactment of the Act establishing such advisory committee.
    (f) No advisory committee required under this section to file a 
charter shall take any action, other than preparation and filing of such 
charter, between the date the new charter is required and the date on 
which such charter is actually filed.



Sec. 12.16  Reports about the advisory committees.

    (a) The Agency will furnish a report of the activities of the FEMA 
advisory committees annually to the Administrator, General Services 
Administration, in accordance with the Federal Property Management 
Regulations.
    (b) The Agency will furnish a report of the activities of FEMA 
advisory

[[Page 144]]

committees annually to the Secretariat.
    (c) The Agency will inform the Secretariat, by letter, of the 
termination of, or other significant changes with respect to, its 
advisory committees no later than 10 working days following the end of 
the month in which the committee is changed. If no changes are made 
during any given month the report of the Secretariat is not required.

[45 FR 64180, Sept. 29, 1980, as amended at 48 FR 44543, Sept. 29, 1983]



Sec. 12.17  Availability of documents and information on advisory committees.

    (a) Subject to the provisions of Secs. 12.12 and 12.13 of this part, 
the records, reports, transcripts, minutes, appendices, working papers, 
drafts, studies, agenda, or other documents which were made available to 
or prepared for by each advisory committee shall be available for public 
inspection and copying at a single location in the FEMA Headquarters, 
Washington, DC, in accordance with the regulations in part 5 of this 
chapter.
    (b) The Agency will maintain systematic information on the nature, 
functions, and operations of each of its advisory committees. A complete 
set of the charters of the Agency's advisory committees and copies of 
the annual reports required by Sec. 12.16 will be maintained for public 
inspection in the FEMA Headquarters.

[45 FR 64180, Sept. 29, 1980, as amended at 47 FR 13150, Mar. 29, 1982]



Sec. 12.18  Uniform pay guidelines.

    (a) Members. Subject to the provisions of this section, the pay of 
any member of an advisory committee shall be fixed at the daily 
equivalent rate of the FEMA general salary schedule unless the member is 
appointed as a consultant, to be compensated as provided in paragraph 
(c) of this section. In determining an appropriate rate of pay for the 
members of an advisory committee, consideration shall be given to the 
significance, scope and technical complexity of the matters with which 
the advisory committee is concerned, and the qualifications required of 
the members of the advisory committee. The pay of the members of an 
advisory committee shall not be fixed at a rate higher than the daily 
equivalent of the maximum rate for GS-15 unless the Director has 
determined that, under the factors set forth in this paragraph, a higher 
rate of pay is justified and necessary. Such a determination will be 
reviewed annually by the Director.
    (b) Advisory committee staff. The pay of each member of the staff of 
an advisory committee shall be fixed at a rate of the general salary 
schedule in which the staff member's position would be appropriately 
compensated for in the FEMA evaluation system applicable to the 
position. Pay of the member of the staff of an advisory committee shall 
not be fixed at a rate higher than the daily equivalent of the maximum 
rate for a GS-15 unless the Director or his designee has determined 
that, under its evaluation system, the staff member's position would 
appropriately be placed in the General Salary Schedule at a grade higher 
than GS-15. Such a determination will be reviewed by the Director 
annually.
    (c) Consultants. The rate of pay of a consultant to an advisory 
committee shall not exceed the maximum rate of pay which FEMA may pay 
experts and consultants under 5 U.S.C. 3109. Consideration shall be 
given to the qualifications required of the consultant and the 
significance, scope, and technical complexity of the work in fixing the 
rate of pay for the consultants.
    (d) Voluntary services. The provisions of this section shall not 
prevent FEMA from accepting the voluntary services of a member of an 
advisory committee, or a member of the staff of an advisory committee, 
provided that FEMA has the authority to accept such services without 
compensation.
    (e) Reimbursable travel expenses. The members of an advisory 
committee and the staff thereof, while engaged in the performance of 
their duties away from their home or regular places of business, may be 
allowed travel expenses, including per diem and in lieu of subsistences, 
as authorized by 5 U.S.C. 5703 for persons employed intermittently in 
the government service.

[[Page 145]]



Sec. 12.19  Fiscal and administrative responsibilities.

    (a) The Comptroller, FEMA, shall keep such records as will fully 
disclose the disposition of any funds which may be at the disposal of 
any FEMA advisory committee.
    (b) The FEMA Advisory Committee management officer or designee shall 
keep such records as are necessary to fully disclose the nature and 
extent of the activities of the FEMA advisory committees.
    (c) Support services shall be provided by FEMA for each advisory 
committee established by or reporting to it, unless the establishing 
authority provides otherwise. Where such advisory committee reports to 
more than one agency, only one agency or component thereof shall be 
responsible for support services at any one time, and the establishing 
authority shall designate the agency responsible for providing such 
services.

[45 FR 64180, Sept. 29, 1980, as amended at 48 FR 44543, Sept. 29, 1983]



PART 13--UNIFORM ADMINISTRATIVE REQUIREMENTS FOR GRANTS AND COOPERATIVE AGREEMENTS TO STATE AND LOCAL GOVERNMENTS--Table of Contents




                           Subpart A--General

Sec.
13.1  Purpose and scope of this part.
13.2  Scope of subpart.
13.3  Definitions.
13.4  Applicability.
13.5  Effect on other issuances.
13.6  Additions and exceptions.

                    Subpart B--Pre-Award Requirements

13.10  Forms for applying for grants.
13.11  State plans.
13.12  Special grant or subgrant conditions for ``high-risk'' grantees.

                   Subpart C--Post-Award Requirements

                        Financial Administration

13.20  Standards for financial management systems.
13.21  Payment.
13.22  Allowable costs.
13.23  Period of availability of funds.
13.24  Matching or cost sharing.
13.25  Program income.
13.26  Non-Federal audit.

                    Changes, Property, and Subawards

13.30  Changes.
13.31  Real property.
13.32  Equipment.
13.33  Supplies.
13.34  Copyrights.
13.35  Subawards to debarred and suspended parties.
13.36  Procurement.
13.37  Subgrants.

               Reports, Records Retention, and Enforcement

13.40  Monitoring and reporting program performance.
13.41  Financial reporting.
13.42  Retention and access requirements for records.
13.43  Enforcement.
13.44  Termination for convenience.

                 Subpart D--After-the-Grant Requirements

13.50  Closeout.
13.51  Later disallowances and adjustments.
13.52  Collection of amounts due.

                   Subpart E--Entitlements [Reserved]

    Authority: Reorganization Plan No. 3of 1978; 43 FR 41943, 3 CFR, 
1978 Comp., p. 329; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 412.

    Source: 53 FR 8078, 8087, Mar. 11, 1988, unless otherwise noted.

    Editorial Note: For additional information, see related documents 
published at 49 FR 24958, June 18, 1984; 52 FR 20178, May 29, 1987; and 
53 FR 8028, Mar. 11, 1988.



                           Subpart A--General



Sec. 13.1  Purpose and scope of this part.

    This part establishes uniform administrative rules for Federal 
grants and cooperative agreements and subawards to State, local and 
Indian tribal governments.



Sec. 13.2  Scope of subpart.

    This subpart contains general rules pertaining to this part and 
procedures for control of exceptions from this part.



Sec. 13.3  Definitions.

    As used in this part:
    Accrued expenditures mean the charges incurred by the grantee during

[[Page 146]]

a given period requiring the provision of funds for:
    (1) Goods and other tangible property received;
    (2) Services performed by employees, contractors, subgrantees, 
subcontractors, and other payees; and
    (3) Other amounts becoming owed under programs for which no current 
services or performance is required, such as annuities, insurance 
claims, and other benefit payments.
    Accrued income means the sum of: (1) Earnings during a given period 
from services performed by the grantee and goods and other tangible 
property delivered to purchasers, and (2) amounts becoming owed to the 
grantee for which no current services or performance is required by the 
grantee.
    Acquisition cost of an item of purchased equipment means the net 
invoice unit price of the property including the cost of modifications, 
attachments, accessories, or auxiliary apparatus necessary to make the 
property usable for the purpose for which it was acquired. Other charges 
such as the cost of installation, transportation, taxes, duty or 
protective in-transit insurance, shall be included or excluded from the 
unit acquisition cost in accordance with the grantee's regular 
accounting practices.
    Administrative requirements mean those matters common to grants in 
general, such as financial management, kinds and frequency of reports, 
and retention of records. These are distinguished from ``programmatic'' 
requirements, which concern matters that can be treated only on a 
program-by-program or grant-by-grant basis, such as kinds of activities 
that can be supported by grants under a particular program.
    Awarding agency means (1) with respect to a grant, the Federal 
agency, and (2) with respect to a subgrant, the party that awarded the 
subgrant.
    Cash contributions means the grantee's cash outlay, including the 
outlay of money contributed to the grantee or subgrantee by other public 
agencies and institutions, and private organizations and individuals. 
When authorized by Federal legislation, Federal funds received from 
other assistance agreements may be considered as grantee or subgrantee 
cash contributions.
    Contract means (except as used in the definitions for grant and 
subgrant in this section and except where qualified by Federal) a 
procurement contract under a grant or subgrant, and means a procurement 
subcontract under a contract.
    Cost sharing or matching means the value of the third party in-kind 
contributions and the portion of the costs of a federally assisted 
project or program not borne by the Federal Government.
    Cost-type contract means a contract or subcontract under a grant in 
which the contractor or subcontractor is paid on the basis of the costs 
it incurs, with or without a fee.
    Equipment means tangible, nonexpendable, personal property having a 
useful life of more than one year and an acquisition cost of $5,000 or 
more per unit. A grantee may use its own definition of equipment 
provided that such definition would at least include all equipment 
defined above.
    Expenditure report means: (1) For nonconstruction grants, the SF-269 
``Financial Status Report'' (or other equivalent report); (2) for 
construction grants, the SF-271 ``Outlay Report and Request for 
Reimbursement'' (or other equivalent report).
    Federally recognized Indian tribal government means the governing 
body or a governmental agency of any Indian tribe, band, nation, or 
other organized group or community (including any Native village as 
defined in section 3 of the Alaska Native Claims Settlement Act, 85 Stat 
688) certified by the Secretary of the Interior as eligible for the 
special programs and services provided by him through the Bureau of 
Indian Affairs.
    Government means a State or local government or a federally 
recognized Indian tribal government.
    Grant means an award of financial assistance, including cooperative 
agreements, in the form of money, or property in lieu of money, by the 
Federal Government to an eligible grantee. The term does not include 
technical assistance which provides services instead of money, or other 
assistance in the form

[[Page 147]]

of revenue sharing, loans, loan guarantees, interest subsidies, 
insurance, or direct appropriations. Also, the term does not include 
assistance, such as a fellowship or other lump sum award, which the 
grantee is not required to account for.
    Grantee means the government to which a grant is awarded and which 
is accountable for the use of the funds provided. The grantee is the 
entire legal entity even if only a particular component of the entity is 
designated in the grant award document.
    Local government means a county, municipality, city, town, township, 
local public authority (including any public and Indian housing agency 
under the United States Housing Act of 1937) school district, special 
district, intrastate district, council of governments (whether or not 
incorporated as a nonprofit corporation under state law), any other 
regional or interstate government entity, or any agency or 
instrumentality of a local government.
    Obligations means the amounts of orders placed, contracts and 
subgrants awarded, goods and services received, and similar transactions 
during a given period that will require payment by the grantee during 
the same or a future period.
    OMB means the United States Office of Management and Budget.
    Outlays (expenditures) mean charges made to the project or program. 
They may be reported on a cash or accrual basis. For reports prepared on 
a cash basis, outlays are the sum of actual cash disbursement for direct 
charges for goods and services, the amount of indirect expense incurred, 
the value of in-kind contributions applied, and the amount of cash 
advances and payments made to contractors and subgrantees. For reports 
prepared on an accrued expenditure basis, outlays are the sum of actual 
cash disbursements, the amount of indirect expense incurred, the value 
of inkind contributions applied, and the new increase (or decrease) in 
the amounts owed by the grantee for goods and other property received, 
for services performed by employees, contractors, subgrantees, 
subcontractors, and other payees, and other amounts becoming owed under 
programs for which no current services or performance are required, such 
as annuities, insurance claims, and other benefit payments.
    Percentage of completion method refers to a system under which 
payments are made for construction work according to the percentage of 
completion of the work, rather than to the grantee's cost incurred.
    Prior approval means documentation evidencing consent prior to 
incurring specific cost.
    Real property means land, including land improvements, structures 
and appurtenances thereto, excluding movable machinery and equipment.
    Share, when referring to the awarding agency's portion of real 
property, equipment or supplies, means the same percentage as the 
awarding agency's portion of the acquiring party's total costs under the 
grant to which the acquisition costs under the grant to which the 
acquisition cost of the property was charged. Only costs are to be 
counted--not the value of third-party in-kind contributions.
    State means any of the several States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency or instrumentality of a 
State exclusive of local governments. The term does not include any 
public and Indian housing agency under United States Housing Act of 
1937.
    Subgrant means an award of financial assistance in the form of 
money, or property in lieu of money, made under a grant by a grantee to 
an eligible subgrantee. The term includes financial assistance when 
provided by contractual legal agreement, but does not include 
procurement purchases, nor does it include any form of assistance which 
is excluded from the definition of grant in this part.
    Subgrantee means the government or other legal entity to which a 
subgrant is awarded and which is accountable to the grantee for the use 
of the funds provided.
    Supplies means all tangible personal property other than equipment 
as defined in this part.
    Suspension means depending on the context, either (1) temporary 
withdrawal of the authority to obligate grant funds pending corrective 
action

[[Page 148]]

by the grantee or subgrantee or a decision to terminate the grant, or 
(2) an action taken by a suspending official in accordance with agency 
regulations implementing E.O. 12549 to immediately exclude a person from 
participating in grant transactions for a period, pending completion of 
an investigation and such legal or debarment proceedings as may ensue.
    Termination means permanent withdrawal of the authority to obligate 
previously-awarded grant funds before that authority would otherwise 
expire. It also means the voluntary relinquishment of that authority by 
the grantee or subgrantee. ``Termination'' does not include: (1) 
Withdrawal of funds awarded on the basis of the grantee's underestimate 
of the unobligated balance in a prior period; (2) Withdrawal of the 
unobligated balance as of the expiration of a grant; (3) Refusal to 
extend a grant or award additional funds, to make a competing or 
noncompeting continuation, renewal, extension, or supplemental award; or 
(4) voiding of a grant upon determination that the award was obtained 
fraudulently, or was otherwise illegal or invalid from inception.
    Terms of a grant or subgrant mean all requirements of the grant or 
subgrant, whether in statute, regulations, or the award document.
    Third party in-kind contributions mean property or services which 
benefit a federally assisted project or program and which are 
contributed by non-Federal third parties without charge to the grantee, 
or a cost-type contractor under the grant agreement.
    Unliquidated obligations for reports prepared on a cash basis mean 
the amount of obligations incurred by the grantee that has not been 
paid. For reports prepared on an accrued expenditure basis, they 
represent the amount of obligations incurred by the grantee for which an 
outlay has not been recorded.
    Unobligated balance means the portion of the funds authorized by the 
Federal agency that has not been obligated by the grantee and is 
determined by deducting the cumulative obligations from the cumulative 
funds authorized.



Sec. 13.4  Applicability.

    (a) General. Subparts A through D of this part apply to all grants 
and subgrants to governments, except where inconsistent with Federal 
statutes or with regulations authorized in accordance with the exception 
provision of section 13.6, or:
    (1) Grants and subgrants to State and local institutions of higher 
education or State and local hospitals.
    (2) The block grants authorized by the Omnibus Budget Reconciliation 
Act of 1981 (Community Services; Preventive Health and Health Services; 
Alcohol, Drug Abuse, and Mental Health Services; Maternal and Child 
Health Services; Social Services; Low-Income Home Energy Assistance; 
States' Program of Community Development Block Grants for Small Cities; 
and Elementary and Secondary Education other than programs administered 
by the Secretary of Education under title V, subtitle D, Chapter 2, 
Section 583--the Secretary's discretionary grant program) and titles I-
III of the Job Training Partnership Act of 1982 and under the Public 
Health Services Act (section 1921), Alcohol and Drug Abuse Treatment and 
Rehabilitation Block Grant and Part C of title V, Mental Health Service 
for the Homeless Block Grant).
    (3) Entitlement grants to carry out the following programs of the 
Social Security Act:
    (i) Aid to Needy Families with Dependent Children (Title IV-A of the 
Act, not including the Work Incentive Program (WIN) authorized by 
section 402(a)19(G); HHS grants for WIN are subject to this part);
    (ii) Child Support Enforcement and Establishment of Paternity (Title 
IV-D of the Act);
    (iii) Foster Care and Adoption Assistance (Title IV-E of the Act);
    (iv) Aid to the Aged, Blind, and Disabled (Titles I, X, XIV, and 
XVI-AABD of the Act); and
    (v) Medical Assistance (Medicaid) (Title XIX of the Act) not 
including the State Medicaid Fraud Control program authorized by section 
1903(a)(6)(B).
    (4) Entitlement grants under the following programs of The National 
School Lunch Act:

[[Page 149]]

    (i) School Lunch (section 4 of the Act),
    (ii) Commodity Assistance (section 6 of the Act),
    (iii) Special Meal Assistance (section 11 of the Act),
    (iv) Summer Food Service for Children (section 13 of the Act), and
    (v) Child Care Food Program (section 17 of the Act).
    (5) Entitlement grants under the following programs of The Child 
Nutrition Act of 1966:
    (i) Special Milk (section 3 of the Act), and
    (ii) School Breakfast (section 4 of the Act).
    (6) Entitlement grants for State Administrative expenses under The 
Food Stamp Act of 1977 (section 16 of the Act).
    (7) A grant for an experimental, pilot, or demonstration project 
that is also supported by a grant listed in paragraph (a)(3) of this 
section;
    (8) Grant funds awarded under subsection 412(e) of the Immigration 
and Nationality Act (8 U.S.C. 1522(e)) and subsection 501(a) of the 
Refugee Education Assistance Act of 1980 (Pub. L. 96-422, 94 Stat. 
1809), for cash assistance, medical assistance, and supplemental 
security income benefits to refugees and entrants and the administrative 
costs of providing the assistance and benefits;
    (9) Grants to local education agencies under 20 U.S.C. 236 through 
241-1(a), and 242 through 244 (portions of the Impact Aid program), 
except for 20 U.S.C. 238(d)(2)(c) and 240(f) (Entitlement Increase for 
Handicapped Children); and
    (10) Payments under the Veterans Administration's State Home Per 
Diem Program (38 U.S.C. 641(a)).
    (b) Entitlement programs. Entitlement programs enumerated above in 
Sec. 13.4(a) (3) through (8) are subject to subpart E.



Sec. 13.5  Effect on other issuances.

    All other grants administration provisions of codified program 
regulations, program manuals, handbooks and other nonregulatory 
materials which are inconsistent with this part are superseded, except 
to the extent they are required by statute, or authorized in accordance 
with the exception provision in Sec. 13.6.



Sec. 13.6  Additions and exceptions.

    (a) For classes of grants and grantees subject to this part, Federal 
agencies may not impose additional administrative requirements except in 
codified regulations published in the Federal Register.
    (b) Exceptions for classes of grants or grantees may be authorized 
only by OMB.
    (c) Exceptions on a case-by-case basis and for subgrantees may be 
authorized by the affected Federal agencies.



                    Subpart B--Pre-Award Requirements



Sec. 13.10  Forms for applying for grants.

    (a) Scope. (1) This section prescribes forms and instructions to be 
used by governmental organizations (except hospitals and institutions of 
higher education operated by a government) in applying for grants. This 
section is not applicable, however, to formula grant programs which do 
not require applicants to apply for funds on a project basis.
    (2) This section applies only to applications to Federal agencies 
for grants, and is not required to be applied by grantees in dealing 
with applicants for subgrants. However, grantees are encouraged to avoid 
more detailed or burdensome application requirements for subgrants.
    (b) Authorized forms and instructions for governmental 
organizations. (1) In applying for grants, applicants shall only use 
standard application forms or those prescribed by the granting agency 
with the approval of OMB under the Paperwork Reduction Act of 1980.
    (2) Applicants are not required to submit more than the original and 
two copies of preapplications or applications.
    (3) Applicants must follow all applicable instructions that bear OMB 
clearance numbers. Federal agencies may specify and describe the 
programs, functions, or activities that will be used to plan, budget, 
and evaluate the work under a grant. Other supplementary instructions 
may be issued only with the approval of OMB to the extent required under 
the Paperwork

[[Page 150]]

Reduction Act of 1980. For any standard form, except the SF-424 
facesheet, Federal agencies may shade out or instruct the applicant to 
disregard any line item that is not needed.
    (4) When a grantee applies for additional funding (such as a 
continuation or supplemental award) or amends a previously submitted 
application, only the affected pages need be submitted. Previously 
submitted pages with information that is still current need not be 
resubmitted.



Sec. 13.11  State plans.

    (a) Scope. The statutes for some programs require States to submit 
plans before receiving grants. Under regulations implementing Executive 
Order 12372, ``Intergovernmental Review of Federal Programs,'' States 
are allowed to simplify, consolidate and substitute plans. This section 
contains additional provisions for plans that are subject to regulations 
implementing the Executive Order.
    (b) Requirements. A State need meet only Federal administrative or 
programmatic requirements for a plan that are in statutes or codified 
regulations.
    (c) Assurances. In each plan the State will include an assurance 
that the State shall comply with all applicable Federal statutes and 
regulations in effect with respect to the periods for which it receives 
grant funding. For this assurance and other assurances required in the 
plan, the State may:
    (1) Cite by number the statutory or regulatory provisions requiring 
the assurances and affirm that it gives the assurances required by those 
provisions,
    (2) Repeat the assurance language in the statutes or regulations, or
    (3) Develop its own language to the extent permitted by law.
    (d) Amendments. A State will amend a plan whenever necessary to 
reflect: (1) New or revised Federal statutes or regulations or (2) a 
material change in any State law, organization, policy, or State agency 
operation. The State will obtain approval for the amendment and its 
effective date but need submit for approval only the amended portions of 
the plan.



Sec. 13.12  Special grant or subgrant conditions for ``high-risk'' grantees.

    (a) A grantee or subgrantee may be considered ``high risk'' if an 
awarding agency determines that a grantee or subgrantee:
    (1) Has a history of unsatisfactory performance, or
    (2) Is not financially stable, or
    (3) Has a management system which does not meet the management 
standards set forth in this part, or
    (4) Has not conformed to terms and conditions of previous awards, or
    (5) Is otherwise not responsible; and if the awarding agency 
determines that an award will be made, special conditions and/or 
restrictions shall correspond to the high risk condition and shall be 
included in the award.
    (b) Special conditions or restrictions may include:
    (1) Payment on a reimbursement basis;
    (2) Withholding authority to proceed to the next phase until receipt 
of evidence of acceptable performance within a given funding period;
    (3) Requiring additional, more detailed financial reports;
    (4) Additional project monitoring;
    (5) Requiring the grante or subgrantee to obtain technical or 
management assistance; or
    (6) Establishing additional prior approvals.
    (c) If an awarding agency decides to impose such conditions, the 
awarding official will notify the grantee or subgrantee as early as 
possible, in writing, of:
    (1) The nature of the special conditions/restrictions;
    (2) The reason(s) for imposing them;
    (3) The corrective actions which must be taken before they will be 
removed and the time allowed for completing the corrective actions and
    (4) The method of requesting reconsideration of the conditions/
restrictions imposed.

[[Page 151]]



                   Subpart C--Post-Award Requirements

                        Financial Administration



Sec. 13.20  Standards for financial management systems.

    (a) A State must expand and account for grant funds in accordance 
with State laws and procedures for expending and accounting for its own 
funds. Fiscal control and accounting procedures of the State, as well as 
its subgrantees and cost-type contractors, must be sufficient to--
    (1) Permit preparation of reports required by this part and the 
statutes authorizing the grant, and
    (2) Permit the tracing of funds to a level of expenditures adequate 
to establish that such funds have not been used in violation of the 
restrictions and prohibitions of applicable statutes.
    (b) The financial management systems of other grantees and 
subgrantees must meet the following standards:
    (1) Financial reporting. Accurate, current, and complete disclosure 
of the financial results of financially assisted activities must be made 
in accordance with the financial reporting requirements of the grant or 
subgrant.
    (2) Accounting records. Grantees and subgrantees must maintain 
records which adequately identify the source and application of funds 
provided for financially-assisted activities. These records must contain 
information pertaining to grant or subgrant awards and authorizations, 
obligations, unobligated balances, assets, liabilities, outlays or 
expenditures, and income.
    (3) Internal control. Effective control and accountability must be 
maintained for all grant and subgrant cash, real and personal property, 
and other assets. Grantees and subgrantees must adequately safeguard all 
such property and must assure that it is used solely for authorized 
purposes.
    (4) Budget control. Actual expenditures or outlays must be compared 
with budgeted amounts for each grant or subgrant. Financial information 
must be related to performance or productivity data, including the 
development of unit cost information whenever appropriate or 
specifically required in the grant or subgrant agreement. If unit cost 
data are required, estimates based on available documentation will be 
accepted whenever possible.
    (5) Allowable cost. Applicable OMB cost principles, agency program 
regulations, and the terms of grant and subgrant agreements will be 
followed in determining the reasonableness, allowability, and 
allocability of costs.
    (6) Source documentation. Accounting records must be supported by 
such source documentation as cancelled checks, paid bills, payrolls, 
time and attendance records, contract and subgrant award documents, etc.
    (7) Cash management. Procedures for minimizing the time elapsing 
between the transfer of funds from the U.S. Treasury and disbursement by 
grantees and subgrantees must be followed whenever advance payment 
procedures are used. Grantees must establish reasonable procedures to 
ensure the receipt of reports on subgrantees' cash balances and cash 
disbursements in sufficient time to enable them to prepare complete and 
accurate cash transactions reports to the awarding agency. When advances 
are made by letter-of-credit or electronic transfer of funds methods, 
the grantee must make drawdowns as close as possible to the time of 
making disbursements. Grantees must monitor cash drawdowns by their 
subgrantees to assure that they conform substantially to the same 
standards of timing and amount as apply to advances to the grantees.
    (c) An awarding agency may review the adequacy of the financial 
management system of any applicant for financial assistance as part of a 
preaward review or at any time subsequent to award.



Sec. 13.21  Payment.

    (a) Scope. This section prescribes the basic standard and the 
methods under which a Federal agency will make payments to grantees, and 
grantees will make payments to subgrantees and contractors.
    (b) Basic standard. Methods and procedures for payment shall 
minimize the time elapsing between the transfer of funds and 
disbursement by the grantee or subgrantee, in accordance

[[Page 152]]

with Treasury regulations at 31 CFR part 205.
    (c) Advances. Grantees and subgrantees shall be paid in advance, 
provided they maintain or demonstrate the willingness and ability to 
maintain procedures to minimize the time elapsing between the transfer 
of the funds and their disbursement by the grantee or subgrantee.
    (d) Reimbursement. Reimbursement shall be the preferred method when 
the requirements in paragraph (c) of this section are not met. Grantees 
and subgrantees may also be paid by reimbursement for any construction 
grant. Except as otherwise specified in regulation, Federal agencies 
shall not use the percentage of completion method to pay construction 
grants. The grantee or subgrantee may use that method to pay its 
construction contractor, and if it does, the awarding agency's payments 
to the grantee or subgrantee will be based on the grantee's or 
subgrantee's actual rate of disbursement.
    (e) Working capital advances. If a grantee cannot meet the criteria 
for advance payments described in paragraph (c) of this section, and the 
Federal agency has determined that reimbursement is not feasible because 
the grantee lacks sufficient working capital, the awarding agency may 
provide cash or a working capital advance basis. Under this procedure 
the awarding agency shall advance cash to the grantee to cover its 
estimated disbursement needs for an initial period generally geared to 
the grantee's disbursing cycle. Thereafter, the awarding agency shall 
reimburse the grantee for its actual cash disbursements. The working 
capital advance method of payment shall not be used by grantees or 
subgrantees if the reason for using such method is the unwillingness or 
inability of the grantee to provide timely advances to the subgrantee to 
meet the subgrantee's actual cash disbursements.
    (f) Effect of program income, refunds, and audit recoveries on 
payment. (1) Grantees and subgrantees shall disburse repayments to and 
interest earned on a revolving fund before requesting additional cash 
payments for the same activity.
    (2) Except as provided in paragraph (f)(1) of this section, grantees 
and subgrantees shall disburse program income, rebates, refunds, 
contract settlements, audit recoveries and interest earned on such funds 
before requesting additional cash payments.
    (g) Withholding payments. (1) Unless otherwise required by Federal 
statute, awarding agencies shall not withhold payments for proper 
charges incurred by grantees or subgrantees unless--
    (i) The grantee or subgrantee has failed to comply with grant award 
conditions or
    (ii) The grantee or subgrantee is indebted to the United States.
    (2) Cash withheld for failure to comply with grant award condition, 
but without suspension of the grant, shall be released to the grantee 
upon subsequent compliance. When a grant is suspended, payment 
adjustments will be made in accordance with Sec. 13.43(c).
    (3) A Federal agency shall not make payment to grantees for amounts 
that are withheld by grantees or subgrantees from payment to contractors 
to assure satisfactory completion of work. Payments shall be made by the 
Federal agency when the grantees or subgrantees actually disburse the 
withheld funds to the contractors or to escrow accounts established to 
assure satisfactory completion of work.
    (h) Cash depositories. (1) Consistent with the national goal of 
expanding the opportunities for minority business enterprises, grantees 
and subgrantees are encouraged to use minority banks (a bank which is 
owned at least 50 percent by minority group members). A list of minority 
owned banks can be obtained from the Minority Business Development 
Agency, Department of Commerce, Washington, DC 20230.
    (2) A grantee or subgrantee shall maintain a separate bank account 
only when required by Federal-State agreement.
    (i) Interest earned on advances. Except for interest earned on 
advances of funds exempt under the Intergovernmental Cooperation Act (31 
U.S.C. 6501 et seq.) and the Indian Self-Determination Act (23 U.S.C. 
450), grantees and subgrantees shall promptly, but at least quarterly, 
remit interest earned on advances to the Federal agency. The

[[Page 153]]

grantee or subgrantee may keep interest amounts up to $100 per year for 
administrative expenses.



Sec. 13.22  Allowable costs.

    (a) Limitation on use of funds. Grant funds may be used only for:
    (1) The allowable costs of the grantees, subgrantees and cost-type 
contractors, including allowable costs in the form of payments to fixed-
price contractors; and
    (2) Reasonable fees or profit to cost-type contractors but not any 
fee or profit (or other increment above allowable costs) to the grantee 
or subgrantee.
    (b) Applicable cost principles. For each kind of organization, there 
is a set of Federal principles for determining allowable costs. 
Allowable costs will be determined in accordance with the cost 
principles applicable to the organization incurring the costs. The 
following chart lists the kinds of organizations and the applicable cost 
principles.

                                                                        
------------------------------------------------------------------------
           For the costs of a--                Use the principles in--  
------------------------------------------------------------------------
State, local or Indian tribal government..  OMB Circular A-87.          
Private nonprofit organization other than   OBM Circular A-122.         
 an (1) institution of higher education,                                
 (2) hospital, or (3) organization named                                
 in OMB Circular A-122 as not subject to                                
 that circular.                                                         
Educational institutions..................  OMB Circular A-21.          
For-profit organization other than a        48 CFR part 31. Contract    
 hospital and an organization named in OBM   Cost Principles and        
 Circular A-122 as not subject to that       Procedures, or uniform cost
 circular.                                   accounting standards that  
                                             comply with cost principles
                                             acceptable to the Federal  
                                             agency.                    
------------------------------------------------------------------------



Sec. 13.23  Period of availability of funds.

    (a) General. Where a funding period is specified, a grantee may 
charge to the award only costs resulting from obligations of the funding 
period unless carryover of unobligated balances is permitted, in which 
case the carryover balances may be charged for costs resulting from 
obligations of the subsequent funding period.
    (b) Liquidation of obligations. A grantee must liquidate all 
obligations incurred under the award not later than 90 days after the 
end of the funding period (or as specified in a program regulation) to 
coincide with the submission of the annual Financial Status Report (SF-
269). The Federal agency may extend this deadline at the request of the 
grantee.



Sec. 13.24  Matching or cost sharing.

    (a) Basic rule: Costs and contributions acceptable. With the 
qualifications and exceptions listed in paragraph (b) of this section, a 
matching or cost sharing requirement may be satisfied by either or both 
of the following:
    (1) Allowable costs incurred by the grantee, subgrantee or a cost-
type contractor under the assistance agreement. This includes allowable 
costs borne by non-Federal grants or by others cash donations from non-
Federal third parties.
    (2) The value of third party in-kind contributions applicable to the 
period to which the cost sharing or matching requirements applies.
    (b) Qualifications and exceptions--(1) Costs borne by other Federal 
grant agreements. Except as provided by Federal statute, a cost sharing 
or matching requirement may not be met by costs borne by another Federal 
grant. This prohibition does not apply to income earned by a grantee or 
subgrantee from a contract awarded under another Federal grant.
    (2) General revenue sharing. For the purpose of this section, 
general revenue sharing funds distributed under 31 U.S.C. 6702 are not 
considered Federal grant funds.
    (3) Cost or contributions counted towards other Federal costs-
sharing requirements. Neither costs nor the values of third party in-
kind contributions may count towards satisfying a cost sharing or 
matching requirement of a grant agreement if they have been or will be 
counted towards satisfying a cost sharing or matching requirement of 
another Federal grant agreement, a Federal procurement contract, or any 
other award of Federal funds.
    (4) Costs financed by program income. Costs financed by program 
income, as defined in Sec. 13.25, shall not count towards satisfying a 
cost sharing or matching requirement unless they are expressly permitted 
in the terms of the assistance agreement. (This use of general program 
income is described in Sec. 13.25(g).)

[[Page 154]]

    (5) Services or property financed by income earned by contractors. 
Contractors under a grant may earn income from the activities carried 
out under the contract in addition to the amounts earned from the party 
awarding the contract. No costs of services or property supported by 
this income may count toward satisfying a cost sharing or matching 
requirement unless other provisions of the grant agreement expressly 
permit this kind of income to be used to meet the requirement.
    (6) Records. Costs and third party in-kind contributions counting 
towards satisfying a cost sharing or matching requirement must be 
verifiable from the records of grantees and subgrantee or cost-type 
contractors. These records must show how the value placed on third party 
in-kind contributions was derived. To the extent feasible, volunteer 
services will be supported by the same methods that the organization 
uses to support the allocability of regular personnel costs.
    (7) Special standards for third party in-kind contributions. (i) 
Third party in-kind contributions count towards satisfying a cost 
sharing or matching requirement only where, if the party receiving the 
contributions were to pay for them, the payments would be allowable 
costs.
    (ii) Some third party in-kind contributions are goods and services 
that, if the grantee, subgrantee, or contractor receiving the 
contribution had to pay for them, the payments would have been an 
indirect costs. Costs sharing or matching credit for such contributions 
shall be given only if the grantee, subgrantee, or contractor has 
established, along with its regular indirect cost rate, a special rate 
for allocating to individual projects or programs the value of the 
contributions.
    (iii) A third party in-kind contribution to a fixed-price contract 
may count towards satisfying a cost sharing or matching requirement only 
if it results in:
    (A) An increase in the services or property provided under the 
contract (without additional cost to the grantee or subgrantee) or
    (B) A cost savings to the grantee or subgrantee.
    (iv) The values placed on third party in-kind contributions for cost 
sharing or matching purposes will conform to the rules in the succeeding 
sections of this part. If a third party in-kind contribution is a type 
not treated in those sections, the value placed upon it shall be fair 
and reasonable.
    (c) Valuation of donated services--(1) Volunteer services. Unpaid 
services provided to a grantee or subgrantee by individuals will be 
valued at rates consistent with those ordinarily paid for similar work 
in the grantee's or subgrantee's organization. If the grantee or 
subgrantee does not have employees performing similar work, the rates 
will be consistent with those ordinarily paid by other employers for 
similar work in the same labor market. In either case, a reasonable 
amount for fringe benefits may be included in the valuation.
    (2) Employees of other organizations. When an employer other than a 
grantee, subgrantee, or cost-type contractor furnishes free of charge 
the services of an employee in the employee's normal line of work, the 
services will be valued at the employee's regular rate of pay exclusive 
of the employee's fringe benefits and overhead costs. If the services 
are in a different line of work, paragraph (c)(1) of this section 
applies.
    (d) Valuation of third party donated supplies and loaned equipment 
or space. (1) If a third party donates supplies, the contribution will 
be valued at the market value of the supplies at the time of donation.
    (2) If a third party donates the use of equipment or space in a 
building but retains title, the contribution will be valued at the fair 
rental rate of the equipment or space.
    (e) Valuation of third party donated equipment, buildings, and land. 
If a third party donates equipment, buildings, or land, and title passes 
to a grantee or subgrantee, the treatment of the donated property will 
depend upon the purpose of the grant or subgrant, as follows:
    (1) Awards for capital expenditures. If the purpose of the grant or 
subgrant is to assist the grantee or subgrantee in the acquisition of 
property, the market value of that property at the time of

[[Page 155]]

donation may be counted as cost sharing or matching,
    (2) Other awards. If assisting in the acquisition of property is not 
the purpose of the grant or subgrant, paragraphs (e)(2) (i) and (ii) of 
this section apply:
    (i) If approval is obtained from the awarding agency, the market 
value at the time of donation of the donated equipment or buildings and 
the fair rental rate of the donated land may be counted as cost sharing 
or matching. In the case of a subgrant, the terms of the grant agreement 
may require that the approval be obtained from the Federal agency as 
well as the grantee. In all cases, the approval may be given only if a 
purchase of the equipment or rental of the land would be approved as an 
allowable direct cost. If any part of the donated property was acquired 
with Federal funds, only the non-federal share of the property may be 
counted as cost-sharing or matching.
    (ii) If approval is not obtained under paragraph (e)(2)(i) of this 
section, no amount may be counted for donated land, and only 
depreciation or use allowances may be counted for donated equipment and 
buildings. The depreciation or use allowances for this property are not 
treated as third party in-kind contributions. Instead, they are treated 
as costs incurred by the grantee or subgrantee. They are computed and 
allocated (usually as indirect costs) in accordance with the cost 
principles specified in Sec. 13.22, in the same way as depreciation or 
use allowances for purchased equipment and buildings. The amount of 
depreciation or use allowances for donated equipment and buildings is 
based on the property's market value at the time it was donated.
    (f) Valuation of grantee or subgrantee donated real property for 
construction/acquisition. If a grantee or subgrantee donates real 
property for a construction or facilities acquisition project, the 
current market value of that property may be counted as cost sharing or 
matching. If any part of the donated property was acquired with Federal 
funds, only the non-federal share of the property may be counted as cost 
sharing or matching.
    (g) Appraisal of real property. In some cases under paragraphs (d), 
(e) and (f) of this section, it will be necessary to establish the 
market value of land or a building or the fair rental rate of land or of 
space in a building. In these cases, the Federal agency may require the 
market value or fair rental value be set by an independent appraiser, 
and that the value or rate be certified by the grantee. This requirement 
will also be imposed by the grantee on subgrantees.



Sec. 13.25  Program income.

    (a) General. Grantees are encouraged to earn income to defray 
program costs. Program income includes income from fees for services 
performed, from the use or rental of real or personal property acquired 
with grant funds, from the sale of commodities or items fabricated under 
a grant agreement, and from payments of principal and interest on loans 
made with grant funds. Except as otherwise provided in regulations of 
the Federal agency, program income does not include interest on grant 
funds, rebates, credits, discounts, refunds, etc. and interest earned on 
any of them.
    (b) Definition of program income. Program income means gross income 
received by the grantee or subgrantee directly generated by a grant 
supported activity, or earned only as a result of the grant agreement 
during the grant period. During the grant period is the time between the 
effective date of the award and the ending date of the award reflected 
in the final financial report.
    (c) Cost of generating program income. If authorized by Federal 
regulations or the grant agreement, costs incident to the generation of 
program income may be deducted from gross income to determine program 
income.
    (d) Governmental revenues. Taxes, special assessments, levies, 
fines, and other such revenues raised by a grantee or subgrantee are not 
program income unless the revenues are specifically identified in the 
grant agreement or Federal agency regulations as program income.
    (e) Royalties. Income from royalties and license fees for 
copyrighted material, patents, and inventions developed by a grantee or 
subgrantee is program income only if the revenues are specifically 
identified in the grant agreement

[[Page 156]]

or Federal agency regulations as program income. (See Sec. 13.34.)
    (f) Property. Proceeds from the sale of real property or equipment 
will be handled in accordance with the requirements of Secs. 13.31 and 
13.32.
    (g) Use of program income. Program income shall be deducted from 
outlays which may be both Federal and non-Federal as described below, 
unless the Federal agency regulations or the grant agreement specify 
another alternative (or a combination of the alternatives). In 
specifying alternatives, the Federal agency may distinguish between 
income earned by the grantee and income earned by subgrantees and 
between the sources, kinds, or amounts of income. When Federal agencies 
authorize the alternatives in paragraphs (g) (2) and (3) of this 
section, program income in excess of any limits stipulated shall also be 
deducted from outlays.
    (1) Deduction. Ordinarily program income shall be deducted from 
total allowable costs to determine the net allowable costs. Program 
income shall be used for current costs unless the Federal agency 
authorizes otherwise. Program income which the grantee did not 
anticipate at the time of the award shall be used to reduce the Federal 
agency and grantee contributions rather than to increase the funds 
committed to the project.
    (2) Addition. When authorized, program income may be added to the 
funds committed to the grant agreement by the Federal agency and the 
grantee. The program income shall be used for the purposes and under the 
conditions of the grant agreement.
    (3) Cost sharing or matching. When authorized, program income may be 
used to meet the cost sharing or matching requirement of the grant 
agreement. The amount of the Federal grant award remains the same.
    (h) Income after the award period. There are no Federal requirements 
governing the disposition of program income earned after the end of the 
award period (i.e., until the ending date of the final financial report, 
see paragraph (a) of this section), unless the terms of the agreement or 
the Federal agency regulations provide otherwise.



Sec. 13.26  Non-Federal audit.

    (a) Basic rule. Grantees and subgrantees are responsible for 
obtaining audits in accordance with the Single Audit Act Amendments of 
1996 (31 U.S.C. 7501-7507) and revised OMB Circular A-133, ``Audits of 
States, Local Governments, and Non-Profit Organizations.'' The audits 
shall be made by an independent auditor in accordance with generally 
accepted government auditing standards covering financial audits.
    (b) Subgrantees. State or local governments, as those terms are 
defined for purposes of the Single Audit Act Amendments of 1996, that 
provide Federal awards to a subgrantee, which expends $300,000 or more 
(or other amount as specified by OMB) in Federal awards in a fiscal 
year, shall:
    (1) Determine whether State or local subgrantees have met the audit 
requirements of the Act and whether subgrantees covered by OMB Circular 
A-110, ``Uniform Administrative Requirements for Grants and Agreements 
with Institutions of Higher Education, Hospitals, and Other Non-Profit 
Organizations,'' have met the audit requirements of the Act. Commercial 
contractors (private for-profit and private and governmental 
organizations) providing goods and services to State and local 
governments are not required to have a single audit performed. State and 
local governments should use their own procedures to ensure that the 
contractor has complied with laws and regulations affecting the 
expenditure of Federal funds;
    (2) Determine whether the subgrantee spent Federal assistance funds 
provided in accordance with applicable laws and regulations. This may be 
accomplished by reviewing an audit of the subgrantee made in accordance 
with the Act, Circular A-110, or through other means (e.g., program 
reviews) if the subgrantee has not had such an audit;
    (3) Ensure that appropriate corrective action is taken within six 
months after receipt of the audit report in instance of noncompliance 
with Federal laws and regulations;
    (4) Consider whether subgrantee audits necessitate adjustment of the 
grantee's own records; and

[[Page 157]]

    (5) Require each subgrantee to permit independent auditors to have 
access to the records and financial statements.
    (c) Auditor selection. In arranging for audit services, Sec. 13.36 
shall be followed.

[53 FR 8079, 887, Mar. 11, 1988, as amended at 62 FR 45939, 45945, Aug. 
29, 1997]

                    Changes, Property, and Subawards



Sec. 13.30  Changes.

    (a) General. Grantees and subgrantees are permitted to rebudget 
within the approved direct cost budget to meet unanticipated 
requirements and may make limited program changes to the approved 
project. However, unless waived by the awarding agency, certain types of 
post-award changes in budgets and projects shall require the prior 
written approval of the awarding agency.
    (b) Relation to cost principles. The applicable cost principles (see 
Sec. 13.22) contain requirements for prior approval of certain types of 
costs. Except where waived, those requirements apply to all grants and 
subgrants even if paragraphs (c) through (f) of this section do not.
    (c) Budget changes--(1) Nonconstruction projects. Except as stated 
in other regulations or an award document, grantees or subgrantees shall 
obtain the prior approval of the awarding agency whenever any of the 
following changes is anticipated under a nonconstruction award:
    (i) Any revision which would result in the need for additional 
funding.
    (ii) Unless waived by the awarding agency, cumulative transfers 
among direct cost categories, or, if applicable, among separately 
budgeted programs, projects, functions, or activities which exceed or 
are expected to exceed ten percent of the current total approved budget, 
whenever the awarding agency's share exceeds $100,000.
    (iii) Transfer of funds allotted for training allowances (i.e., from 
direct payments to trainees to other expense categories).
    (2) Construction projects. Grantees and subgrantees shall obtain 
prior written approval for any budget revision which would result in the 
need for additional funds.
    (3) Combined construction and nonconstruction projects. When a grant 
or subgrant provides funding for both construction and nonconstruction 
activities, the grantee or subgrantee must obtain prior written approval 
from the awarding agency before making any fund or budget transfer from 
nonconstruction to construction or vice versa.
    (d) Programmatic changes. Grantees or subgrantees must obtain the 
prior approval of the awarding agency whenever any of the following 
actions is anticipated:
    (1) Any revision of the scope or objectives of the project 
(regardless of whether there is an associated budget revision requiring 
prior approval).
    (2) Need to extend the period of availability of funds.
    (3) Changes in key persons in cases where specified in an 
application or a grant award. In research projects, a change in the 
project director or principal investigator shall always require approval 
unless waived by the awarding agency.
    (4) Under nonconstruction projects, contracting out, subgranting (if 
authorized by law) or otherwise obtaining the services of a third party 
to perform activities which are central to the purposes of the award. 
This approval requirement is in addition to the approval requirements of 
Sec. 13.36 but does not apply to the procurement of equipment, supplies, 
and general support services.
    (e) Additional prior approval requirements. The awarding agency may 
not require prior approval for any budget revision which is not 
described in paragraph (c) of this section.
    (f) Requesting prior approval. (1) A request for prior approval of 
any budget revision will be in the same budget formal the grantee used 
in its application and shall be accompanied by a narrative justification 
for the proposed revision.
    (2) A request for a prior approval under the applicable Federal cost 
principles (see Sec. 13.22) may be made by letter.
    (3) A request by a subgrantee for prior approval will be addressed 
in writing to the grantee. The grantee will promptly review such request 
and

[[Page 158]]

shall approve or disapprove the request in writing. A grantee will not 
approve any budget or project revision which is inconsistent with the 
purpose or terms and conditions of the Federal grant to the grantee. If 
the revision, requested by the subgrantee would result in a change to 
the grantee's approved project which requires Federal prior approval, 
the grantee will obtain the Federal agency's approval before approving 
the subgrantee's request.



Sec. 13.31  Real property.

    (a) Title. Subject to the obligations and conditions set forth in 
this section, title to real property acquired under a grant or subgrant 
will vest upon acquisition in the grantee or subgrantee respectively.
    (b) Use. Except as otherwise provided by Federal statutes, real 
property will be used for the originally authorized purposes as long as 
needed for that purposes, and the grantee or subgrantee shall not 
dispose of or encumber its title or other interests.
    (c) Disposition. When real property is no longer needed for the 
originally authorized purpose, the grantee or subgrantee will request 
disposition instructions from the awarding agency. The instructions will 
provide for one of the following alternatives:
    (1) Retention of title. Retain title after compensating the awarding 
agency. The amount paid to the awarding agency will be computed by 
applying the awarding agency's percentage of participation in the cost 
of the original purchase to the fair market value of the property. 
However, in those situations where a grantee or subgrantee is disposing 
of real property acquired with grant funds and acquiring replacement 
real property under the same program, the net proceeds from the 
disposition may be used as an offset to the cost of the replacement 
property.
    (2) Sale of property. Sell the property and compensate the awarding 
agency. The amount due to the awarding agency will be calculated by 
applying the awarding agency's percentage of participation in the cost 
of the original purchase to the proceeds of the sale after deduction of 
any actual and reasonable selling and fixing-up expenses. If the grant 
is still active, the net proceeds from sale may be offset against the 
original cost of the property. When a grantee or subgrantee is directed 
to sell property, sales procedures shall be followed that provide for 
competition to the extent practicable and result in the highest possible 
return.
    (3) Transfer of title. Transfer title to the awarding agency or to a 
third-party designated/approved by the awarding agency. The grantee or 
subgrantee shall be paid an amount calculated by applying the grantee or 
subgrantee's percentage of participation in the purchase of the real 
property to the current fair market value of the property.



Sec. 13.32  Equipment.

    (a) Title. Subject to the obligations and conditions set forth in 
this section, title to equipment acquired under a grant or subgrant will 
vest upon acquisition in the grantee or subgrantee respectively.
    (b) States. A State will use, manage, and dispose of equipment 
acquired under a grant by the State in accordance with State laws and 
procedures. Other grantees and subgrantees will follow paragraphs (c) 
through (e) of this section.
    (c) Use. (1) Equipment shall be used by the grantee or subgrantee in 
the program or project for which it was acquired as long as needed, 
whether or not the project or program continues to be supported by 
Federal funds. When no longer needed for the original program or 
project, the equipment may be used in other activities currently or 
previously supported by a Federal agency.
    (2) The grantee or subgrantee shall also make equipment available 
for use on other projects or programs currently or previously supported 
by the Federal Government, providing such use will not interfere with 
the work on the projects or program for which it was originally 
acquired. First preference for other use shall be given to other 
programs or projects supported by the awarding agency. User fees should 
be considered if appropriate.
    (3) Notwithstanding the encouragement in Sec. 13.25(a) to earn 
program income, the grantee or subgrantee must not use equipment 
acquired with grant

[[Page 159]]

funds to provide services for a fee to compete unfairly with private 
companies that provide equivalent services, unless specifically 
permitted or contemplated by Federal statute.
    (4) When acquiring replacement equipment, the grantee or subgrantee 
may use the equipment to be replaced as a trade-in or sell the property 
and use the proceeds to offset the cost of the replacement property, 
subject to the approval of the awarding agency.
    (d) Management requirements. Procedures for managing equipment 
(including replacement equipment), whether acquired in whole or in part 
with grant funds, until disposition takes place will, as a minimum, meet 
the following requirements:
    (1) Property records must be maintained that include a description 
of the property, a serial number or other identification number, the 
source of property, who holds title, the acquisition date, and cost of 
the property, percentage of Federal participation in the cost of the 
property, the location, use and condition of the property, and any 
ultimate disposition data including the date of disposal and sale price 
of the property.
    (2) A physical inventory of the property must be taken and the 
results reconciled with the property records at least once every two 
years.
    (3) A control system must be developed to ensure adequate safeguards 
to prevent loss, damage, or theft of the property. Any loss, damage, or 
theft shall be investigated.
    (4) Adequate maintenance procedures must be developed to keep the 
property in good condition.
    (5) If the grantee or subgrantee is authorized or required to sell 
the property, proper sales procedures must be established to ensure the 
highest possible return.
    (e) Disposition. When original or replacement equipment acquired 
under a grant or subgrant is no longer needed for the original project 
or program or for other activities currently or previously supported by 
a Federal agency, disposition of the equipment will be made as follows:
    (1) Items of equipment with a current per-unit fair market value of 
less than $5,000 may be retained, sold or otherwise disposed of with no 
further obligation to the awarding agency.
    (2) Items of equipment with a current per unit fair market value in 
excess of $5,000 may be retained or sold and the awarding agency shall 
have a right to an amount calculated by multiplying the current market 
value or proceeds from sale by the awarding agency's share of the 
equipment.
    (3) In cases where a grantee or subgrantee fails to take appropriate 
disposition actions, the awarding agency may direct the grantee or 
subgrantee to take excess and disposition actions.
    (f) Federal equipment. In the event a grantee or subgrantee is 
provided federally-owned equipment:
    (1) Title will remain vested in the Federal Government.
    (2) Grantees or subgrantees will manage the equipment in accordance 
with Federal agency rules and procedures, and submit an annual inventory 
listing.
    (3) When the equipment is no longer needed, the grantee or 
subgrantee will request disposition instructions from the Federal 
agency.
    (g) Right to transfer title. The Federal awarding agency may reserve 
the right to transfer title to the Federal Government or a third part 
named by the awarding agency when such a third party is otherwise 
eligible under existing statutes. Such transfers shall be subject to the 
following standards:
    (1) The property shall be identified in the grant or otherwise made 
known to the grantee in writing.
    (2) The Federal awarding agency shall issue disposition instruction 
within 120 calendar days after the end of the Federal support of the 
project for which it was acquired. If the Federal awarding agency fails 
to issue disposition instructions within the 120 calendar-day period the 
grantee shall follow Sec. 13.32(e).
    (3) When title to equipment is transferred, the grantee shall be 
paid an amount calculated by applying the percentage of participation in 
the purchase to the current fair market value of the property.



Sec. 13.33  Supplies.

    (a) Title. Title to supplies acquired under a grant or subgrant will 
vest,

[[Page 160]]

upon acquisition, in the grantee or subgrantee respectively.
    (b) Disposition. If there is a residual inventory of unused supplies 
exceeding $5,000 in total aggregate fair market value upon termination 
or completion of the award, and if the supplies are not needed for any 
other federally sponsored programs or projects, the grantee or 
subgrantee shall compensate the awarding agency for its share.



Sec. 13.34  Copyrights.

    The Federal awarding agency reserves a royalty-free, nonexclusive, 
and irrevocable license to reproduce, publish or otherwise use, and to 
authorize others to use, for Federal Government purposes:
    (a) The copyright in any work developed under a grant, subgrant, or 
contract under a grant or subgrant; and
    (b) Any rights of copyright to which a grantee, subgrantee or a 
contractor purchases ownership with grant support.



Sec. 13.35  Subawards to debarred and suspended parties.

    Grantees and subgrantees must not make any award or permit any award 
(subgrant or contract) at any tier to any party which is debarred or 
suspended or is otherwise excluded from or ineligible for participation 
in Federal assistance programs under Executive Order 12549, ``Debarment 
and Suspension.''



Sec. 13.36  Procurement.

    (a) States. When procuring property and services under a grant, a 
State will follow the same policies and procedures it uses for 
procurements from its non-Federal funds. The State will ensure that 
every purchase order or other contract includes any clauses required by 
Federal statutes and executive orders and their implementing 
regulations. Other grantees and subgrantees will follow paragraphs (b) 
through (i) in this section.
    (b) Procurement standards. (1) Grantees and subgrantees will use 
their own procurement procedures which reflect applicable State and 
local laws and regulations, provided that the procurements conform to 
applicable Federal law and the standards identified in this section.
    (2) Grantees and subgrantees will maintain a contract administration 
system which ensures that contractors perform in accordance with the 
terms, conditions, and specifications of their contracts or purchase 
orders.
    (3) Grantees and subgrantees will maintain a written code of 
standards of conduct governing the performance of their employees 
engaged in the award and administration of contracts. No employee, 
officer or agent of the grantee or subgrantee shall participate in 
selection, or in the award or administration of a contract supported by 
Federal funds if a conflict of interest, real or apparent, would be 
involved. Such a conflict would arise when:
    (i) The employee, officer or agent,
    (ii) Any member of his immediate family,
    (iii) His or her partner, or
    (iv) An organization which employs, or is about to employ, any of 
the above, has a financial or other interest in the firm selected for 
award. The grantee's or subgrantee's officers, employees or agents will 
neither solicit nor accept gratuities, favors or anything of monetary 
value from contractors, potential contractors, or parties to 
subagreements. Grantee and subgrantees may set minimum rules where the 
financial interest is not substantial or the gift is an unsolicited item 
of nominal intrinsic value. To the extent permitted by State or local 
law or regulations, such standards or conduct will provide for 
penalties, sanctions, or other disciplinary actions for violations of 
such standards by the grantee's and subgrantee's officers, employees, or 
agents, or by contractors or their agents. The awarding agency may in 
regulation provide additional prohibitions relative to real, apparent, 
or potential conflicts of interest.
    (4) Grantee and subgrantee procedures will provide for a review of 
proposed procurements to avoid purchase of unnecessary or duplicative 
items. Consideration should be given to consolidating or breaking out 
procurements to obtain a more economical

[[Page 161]]

purchase. Where appropriate, an analysis will be made of lease versus 
purchase alternatives, and any other appropriate analysis to determine 
the most economical approach.
    (5) To foster greater economy and efficiency, grantees and 
subgrantees are encouraged to enter into State and local 
intergovernmental agreements for procurement or use of common goods and 
services.
    (6) Grantees and subgrantees are encouraged to use Federal excess 
and surplus property in lieu of purchasing new equipment and property 
whenever such use is feasible and reduces project costs.
    (7) Grantees and subgrantees are encouraged to use value engineering 
clauses in contracts for construction projects of sufficient size to 
offer reasonable opportunities for cost reductions. Value engineering is 
a systematic and creative anaylsis of each contract item or task to 
ensure that its essential function is provided at the overall lower 
cost.
    (8) Grantees and subgrantees will make awards only to responsible 
contractors possessing the ability to perform successfully under the 
terms and conditions of a proposed procurement. Consideration will be 
given to such matters as contractor integrity, compliance with public 
policy, record of past performance, and financial and technical 
resources.
    (9) Grantees and subgrantees will maintain records sufficient to 
detail the significant history of a procurement. These records will 
include, but are not necessarily limited to the following: rationale for 
the method of procurement, selection of contract type, contractor 
selection or rejection, and the basis for the contract price.
    (10) Grantees and subgrantees will use time and material type 
contracts only--
    (i) After a determination that no other contract is suitable, and
    (ii) If the contract includes a ceiling price that the contractor 
exceeds at its own risk.
    (11) Grantees and subgrantees alone will be responsible, in 
accordance with good administrative practice and sound business 
judgment, for the settlement of all contractual and administrative 
issues arising out of procurements. These issues include, but are not 
limited to source evaluation, protests, disputes, and claims. These 
standards do not relieve the grantee or subgrantee of any contractual 
responsibilities under its contracts. Federal agencies will not 
substitute their judgment for that of the grantee or subgrantee unless 
the matter is primarily a Federal concern. Violations of law will be 
referred to the local, State, or Federal authority having proper 
jurisdiction.
    (12) Grantees and subgrantees will have protest procedures to handle 
and resolve disputes relating to their procurements and shall in all 
instances disclose information regarding the protest to the awarding 
agency. A protestor must exhaust all administrative remedies with the 
grantee and subgrantee before pursuing a protest with the Federal 
agency. Reviews of protests by the Federal agency will be limited to:
    (i) Violations of Federal law or regulations and the standards of 
this section (violations of State or local law will be under the 
jurisdiction of State or local authorities) and
    (ii) Violations of the grantee's or subgrantee's protest procedures 
for failure to review a complaint or protest. Protests received by the 
Federal agency other than those specified above will be referred to the 
grantee or subgrantee.
    (c) Competition. (1) All procurement transactions will be conducted 
in a manner providing full and open competition consistent with the 
standards of section 13.36. Some of the situations considered to be 
restrictive of competition include but are not limited to:
    (i) Placing unreasonable requirements on firms in order for them to 
qualify to do business,
    (ii) Requiring unnecessary experience and excessive bonding,
    (iii) Noncompetitive pricing practices between firms or between 
affiliated companies,
    (iv) Noncompetitive awards to consultants that are on retainer 
contracts,
    (v) Organizational conflicts of interest,
    (vi) Specifying only a ``brand name'' product instead of allowing 
``an equal'' product to be offered and describing

[[Page 162]]

the performance of other relevant requirements of the procurement, and
    (vii) Any arbitrary action in the procurement process.
    (2) Grantees and subgrantees will conduct procurements in a manner 
that prohibits the use of statutorily or administratively imposed in-
State or local geographical preferences in the evaluation of bids or 
proposals, except in those cases where applicable Federal statutes 
expressly mandate or encourage geographic preference. Nothing in this 
section preempts State licensing laws. When contracting for 
architectural and engineering (A/E) services, geographic location may be 
a selection criteria provided its application leaves an appropriate 
number of qualified firms, given the nature and size of the project, to 
compete for the contract.
    (3) Grantees will have written selection procedures for procurement 
transactions. These procedures will ensure that all solicitations:
    (i) Incorporate a clear and accurate description of the technical 
requirements for the material, product, or service to be procured. Such 
description shall not, in competitive procurements, contain features 
which unduly restrict competition. The description may include a 
statement of the qualitative nature of the material, product or service 
to be procured, and when necessary, shall set forth those minimum 
essential characteristics and standards to which it must conform if it 
is to satisfy its intended use. Detailed product specifications should 
be avoided if at all possible. When it is impractical or uneconomical to 
make a clear and accurate description of the technical requirements, a 
``brand name or equal'' description may be used as a means to define the 
performance or other salient requirements of a procurement. The specific 
features of the named brand which must be met by offerors shall be 
clearly stated; and
    (ii) Identify all requirements which the offerors must fulfill and 
all other factors to be used in evaluating bids or proposals.
    (4) Grantees and subgrantees will ensure that all prequalified lists 
of persons, firms, or products which are used in acquiring goods and 
services are current and include enough qualified sources to ensure 
maximum open and free competition. Also, grantees and subgrantees will 
not preclude potential bidders from qualifying during the solicitation 
period.
    (d) Methods of procurement to be followed--(1) Procurement by small 
purchase procedures. Small purchase procedures are those relatively 
simple and informal procurement methods for securing services, supplies, 
or other property that do not cost more than the simplified acquisition 
threshold fixed at 41 U.S.C. 403(11) (currently set at $100,000). If 
small purchase procedures are used, price or rate quotations shall be 
obtained from an adequate number of qualified sources.
    (2) Procurement by sealed bids (formal advertising). Bids are 
publicly solicited and a firm-fixed-price contract (lump sum or unit 
price) is awarded to the responsible bidder whose bid, conforming with 
all the material terms and conditions of the invitation for bids, is the 
lowest in price. The sealed bid method is the preferred method for 
procuring construction, if the conditions in Sec. 13.36(d)(2)(i) apply.
    (i) In order for sealed bidding to be feasible, the following 
conditions should be present:
    (A) A complete, adequate, and realistic specification or purchase 
description is available;
    (B) Two or more responsible bidders are willing and able to compete 
effectively and for the business; and
    (C) The procurement lends itself to a firm fixed price contract and 
the selection of the successful bidder can be made principally on the 
basis of price.
    (ii) If sealed bids are used, the following requirements apply:
    (A) The invitation for bids will be publicly advertised and bids 
shall be solicited from an adequate number of known suppliers, providing 
them sufficient time prior to the date set for opening the bids;
    (B) The invitation for bids, which will include any specifications 
and pertinent attachments, shall define the items or services in order 
for the bidder to properly respond;
    (C) All bids will be publicly opened at the time and place 
prescribed in the invitation for bids;

[[Page 163]]

    (D) A firm fixed-price contract award will be made in writing to the 
lowest responsive and responsible bidder. Where specified in bidding 
documents, factors such as discounts, transportation cost, and life 
cycle costs shall be considered in determining which bid is lowest. 
Payment discounts will only be used to determine the low bid when prior 
experience indicates that such discounts are usually taken advantage of; 
and
    (E) Any or all bids may be rejected if there is a sound documented 
reason.
    (3) Procurement by competitive proposals. The technique of 
competitive proposals is normally conducted with more than one source 
submitting an offer, and either a fixed-price or cost-reimbursement type 
contract is awarded. It is generally used when conditions are not 
appropriate for the use of sealed bids. If this method is used, the 
following requirements apply:
    (i) Requests for proposals will be publicized and identify all 
evaluation factors and their relative importance. Any response to 
publicized requests for proposals shall be honored to the maximum extent 
practical;
    (ii) Proposals will be solicited from an adequate number of 
qualified sources;
    (iii) Grantees and subgrantees will have a method for conducting 
technical evaluations of the proposals received and for selecting 
awardees;
    (iv) Awards will be made to the responsible firm whose proposal is 
most advantageous to the program, with price and other factors 
considered; and
    (v) Grantees and subgrantees may use competitive proposal procedures 
for qualifications-based procurement of architectural/engineering (A/E) 
professional services whereby competitors' qualifications are evaluated 
and the most qualified competitor is selected, subject to negotiation of 
fair and reasonable compensation. The method, where price is not used as 
a selection factor, can only be used in procurement of A/E professional 
services. It cannot be used to purchase other types of services though 
A/E firms are a potential source to perform the proposed effort.
    (4) Procurement by noncompetitive proposals is procurement through 
solicitation of a proposal from only one source, or after solicitation 
of a number of sources, competition is determined inadequate.
    (i) Procurement by noncompetitive proposals may be used only when 
the award of a contract is infeasible under small purchase procedures, 
sealed bids or competitive proposals and one of the following 
circumstances applies:
    (A) The item is available only from a single source;
    (B) The public exigency or emergency for the requirement will not 
permit a delay resulting from competitive solicitation;
    (C) The awarding agency authorizes noncompetitive proposals; or
    (D) After solicitation of a number of sources, competition is 
determined inadequate.
    (ii) Cost analysis, i.e., verifying the proposed cost data, the 
projections of the data, and the evaluation of the specific elements of 
costs and profits, is required.
    (iii) Grantees and subgrantees may be required to submit the 
proposed procurement to the awarding agency for pre-award review in 
accordance with paragraph (g) of this section.
    (e) Contracting with small and minority firms, women's business 
enterprise and labor surplus area firms. (1) The grantee and subgrantee 
will take all necessary affirmative steps to assure that minority firms, 
women's business enterprises, and labor surplus area firms are used when 
possible.
    (2) Affirmative steps shall include:
    (i) Placing qualified small and minority businesses and women's 
business enterprises on solicitation lists;
    (ii) Assuring that small and minority businesses, and women's 
business enterprises are solicited whenever they are potential sources;
    (iii) Dividing total requirements, when economically feasible, into 
smaller tasks or quantities to permit maximum participation by small and 
minority business, and women's business enterprises;
    (iv) Establishing delivery schedules, where the requirement permits, 
which encourage participation by small and minority business, and 
women's business enterprises;

[[Page 164]]

    (v) Using the services and assistance of the Small Business 
Administration, and the Minority Business Development Agency of the 
Department of Commerce; and
    (vi) Requiring the prime contractor, if subcontracts are to be let, 
to take the affirmative steps listed in paragraphs (e)(2) (i) through 
(v) of this section.
    (f) Contract cost and price. (1) Grantees and subgrantees must 
perform a cost or price analysis in connection with every procurement 
action including contract modifications. The method and degree of 
analysis is dependent on the facts surrounding the particular 
procurement situation, but as a starting point, grantees must make 
independent estimates before receiving bids or proposals. A cost 
analysis must be performed when the offeror is required to submit the 
elements of his estimated cost, e.g., under professional, consulting, 
and architectural engineering services contracts. A cost analysis will 
be necessary when adequate price competition is lacking, and for sole 
source procurements, including contract modifications or change orders, 
unless price resonableness can be established on the basis of a catalog 
or market price of a commercial product sold in substantial quantities 
to the general public or based on prices set by law or regulation. A 
price analysis will be used in all other instances to determine the 
reasonableness of the proposed contract price.
    (2) Grantees and subgrantees will negotiate profit as a separate 
element of the price for each contract in which there is no price 
competition and in all cases where cost analysis is performed. To 
establish a fair and reasonable profit, consideration will be given to 
the complexity of the work to be performed, the risk borne by the 
contractor, the contractor's investment, the amount of subcontracting, 
the quality of its record of past performance, and industry profit rates 
in the surrounding geographical area for similar work.
    (3) Costs or prices based on estimated costs for contracts under 
grants will be allowable only to the extent that costs incurred or cost 
estimates included in negotiated prices are consistent with Federal cost 
principles (see Sec. 13.22). Grantees may reference their own cost 
principles that comply with the applicable Federal cost principles.
    (4) The cost plus a percentage of cost and percentage of 
construction cost methods of contracting shall not be used.
    (g) Awarding agency review. (1) Grantees and subgrantees must make 
available, upon request of the awarding agency, technical specifications 
on proposed procurements where the awarding agency believes such review 
is needed to ensure that the item and/or service specified is the one 
being proposed for purchase. This review generally will take place prior 
to the time the specification is incorporated into a solicitation 
document. However, if the grantee or subgrantee desires to have the 
review accomplished after a solicitation has been developed, the 
awarding agency may still review the specifications, with such review 
usually limited to the technical aspects of the proposed purchase.
    (2) Grantees and subgrantees must on request make available for 
awarding agency pre-award review procurement documents, such as requests 
for proposals or invitations for bids, independent cost estimates, etc. 
when:
    (i) A grantee's or subgrantee's procurement procedures or operation 
fails to comply with the procurement standards in this section; or
    (ii) The procurement is expected to exceed the simplified 
acquisition threshold and is to be awarded without competition or only 
one bid or offer is received in response to a solicitation; or
    (iii) The procurement, which is expected to exceed the simplified 
acquisition threshold, specifies a ``brand name'' product; or
    (iv) The proposed award is more than the simplified acquisition 
threshold and is to be awarded to other than the apparent low bidder 
under a sealed bid procurement; or
    (v) A proposed contract modification changes the scope of a contract 
or increases the contract amount by more than the simplified acquisition 
threshold.
    (3) A grantee or subgrantee will be exempt from the pre-award review 
in paragraph (g)(2) of this section if the

[[Page 165]]

awarding agency determines that its procurement systems comply with the 
standards of this section.
    (i) A grantee or subgrantee may request that its procurement system 
be reviewed by the awarding agency to determine whether its system meets 
these standards in order for its system to be certified. Generally, 
these reviews shall occur where there is a continuous high-dollar 
funding, and third-party contracts are awarded on a regular basis.
    (ii) A grantee or subgrantee may self-certify its procurement 
system. Such self-certification shall not limit the awarding agency's 
right to survey the system. Under a self-certification procedure, 
awarding agencies may wish to rely on written assurances from the 
grantee or subgrantee that it is complying with these standards. A 
grantee or subgrantee will cite specific procedures, regulations, 
standards, etc., as being in compliance with these requirements and have 
its system available for review.
    (h) Bonding requirements. For construction or facility improvement 
contracts or subcontracts exceeding the simplified acquisition 
threshold, the awarding agency may accept the bonding policy and 
requirements of the grantee or subgrantee provided the awarding agency 
has made a determination that the awarding agency's interest is 
adequately protected. If such a determination has not been made, the 
minimum requirements shall be as follows:
    (1) A bid guarantee from each bidder equivalent to five percent of 
the bid price. The ``bid guarantee'' shall consist of a firm commitment 
such as a bid bond, certified check, or other negotiable instrument 
accompanying a bid as assurance that the bidder will, upon acceptance of 
his bid, execute such contractual documents as may be required within 
the time specified.
    (2) A performance bond on the part of the contractor for 100 percent 
of the contract price. A ``performance bond'' is one executed in 
connection with a contract to secure fulfillment of all the contractor's 
obligations under such contract.
    (3) A payment bond on the part of the contractor for 100 percent of 
the contract price. A ``payment bond'' is one executed in connection 
with a contract to assure payment as required by law of all persons 
supplying labor and material in the execution of the work provided for 
in the contract.
    (i) Contract provisions. A grantee's and subgrantee's contracts must 
contain provisions in paragraph (i) of this section. Federal agencies 
are permitted to require changes, remedies, changed conditions, access 
and records retention, suspension of work, and other clauses approved by 
the Office of Federal Procurement Policy.
    (1) Administrative, contractual, or legal remedies in instances 
where contractors violate or breach contract terms, and provide for such 
sanctions and penalties as may be appropriate. (Contracts more than the 
simplified acquisition threshold)
    (2) Termination for cause and for convenience by the grantee or 
subgrantee including the manner by which it will be effected and the 
basis for settlement. (All contracts in excess of $10,000)
    (3) Compliance with Executive Order 11246 of September 24, 1965, 
entitled ``Equal Employment Opportunity,'' as amended by Executive Order 
11375 of October 13, 1967, and as supplemented in Department of Labor 
regulations (41 CFR chapter 60). (All construction contracts awarded in 
excess of $10,000 by grantees and their contractors or subgrantees)
    (4) Compliance with the Copeland ``Anti-Kickback'' Act (18 U.S.C. 
874) as supplemented in Department of Labor regulations (29 CFR Part 3). 
(All contracts and subgrants for construction or repair)
    (5) Compliance with the Davis-Bacon Act (40 U.S.C. 276a to 276a-7) 
as supplemented by Department of Labor regulations (29 CFR Part 5). 
(Construction contracts in excess of $2000 awarded by grantees and 
subgrantees when required by Federal grant program legislation)
    (6) Compliance with Sections 103 and 107 of the Contract Work Hours 
and Safety Standards Act (40 U.S.C. 327-330) as supplemented by 
Department of Labor regulations (29 CFR Part 5). (Construction contracts 
awarded by grantees and subgrantees in excess of

[[Page 166]]

$2000, and in excess of $2500 for other contracts which involve the 
employment of mechanics or laborers)
    (7) Notice of awarding agency requirements and regulations 
pertaining to reporting.
    (8) Notice of awarding agency requirements and regulations 
pertaining to patent rights with respect to any discovery or invention 
which arises or is developed in the course of or under such contract.
    (9) Awarding agency requirements and regulations pertaining to 
copyrights and rights in data.
    (10) Access by the grantee, the subgrantee, the Federal grantor 
agency, the Comptroller General of the United States, or any of their 
duly authorized representatives to any books, documents, papers, and 
records of the contractor which are directly pertinent to that specific 
contract for the purpose of making audit, examination, excerpts, and 
transcriptions.
    (11) Retention of all required records for three years after 
grantees or subgrantees make final payments and all other pending 
matters are closed.
    (12) Compliance with all applicable standards, orders, or 
requirements issued under section 306 of the Clean Air Act (42 U.S.C. 
1857(h)), section 508 of the Clean Water Act (33 U.S.C. 1368), Executive 
Order 11738, and Environmental Protection Agency regulations (40 CFR 
part 15). (Contracts, subcontracts, and subgrants of amounts in excess 
of $100,000)
    (13) Mandatory standards and policies relating to energy efficiency 
which are contained in the state energy conservation plan issued in 
compliance with the Energy Policy and Conservation Act (Pub. L. 94-163, 
89 Stat. 871).

[53 FR 8078, 8087, Mar. 11, 1988, as amended at 60 FR 19639, 19645, Apr. 
19, 1995]



Sec. 13.37  Subgrants.

    (a) States. States shall follow state law and procedures when 
awarding and administering subgrants (whether on a cost reimbursement or 
fixed amount basis) of financial assistance to local and Indian tribal 
governments. States shall:
    (1) Ensure that every subgrant includes any clauses required by 
Federal statute and executive orders and their implementing regulations;
    (2) Ensure that subgrantees are aware of requirements imposed upon 
them by Federal statute and regulation;
    (3) Ensure that a provision for compliance with Sec. 13.42 is placed 
in every cost reimbursement subgrant; and
    (4) Conform any advances of grant funds to subgrantees substantially 
to the same standards of timing and amount that apply to cash advances 
by Federal agencies.
    (b) All other grantees. All other grantees shall follow the 
provisions of this part which are applicable to awarding agencies when 
awarding and administering subgrants (whether on a cost reimbursement or 
fixed amount basis) of financial assistance to local and Indian tribal 
governments. Grantees shall:
    (1) Ensure that every subgrant includes a provision for compliance 
with this part;
    (2) Ensure that every subgrant includes any clauses required by 
Federal statute and executive orders and their implementing regulations; 
and
    (3) Ensure that subgrantees are aware of requirements imposed upon 
them by Federal statutes and regulations.
    (c) Exceptions. By their own terms, certain provisions of this part 
do not apply to the award and administration of subgrants:
    (1) Section 13.10;
    (2) Section 13.11;
    (3) The letter-of-credit procedures specified in Treasury 
Regulations at 31 CFR part 205, cited in Sec. 13.21; and
    (4) Section 13.50.

               Reports, Records Retention, and Enforcement



Sec. 13.40  Monitoring and reporting program performance.

    (a) Monitoring by grantees. Grantees are responsible for managing 
the day-to-day operations of grant and subgrant supported activities. 
Grantees must monitor grant and subgrant supported activities to assure 
compliance with applicable Federal requirements and that performance 
goals are being achieved. Grantee monitoring must

[[Page 167]]

cover each program, function or activity.
    (b) Nonconstruction performance reports. The Federal agency may, if 
it decides that performance information available from subsequent 
applications contains sufficient information to meet its programmatic 
needs, require the grantee to submit a performance report only upon 
expiration or termination of grant support. Unless waived by the Federal 
agency this report will be due on the same date as the final Financial 
Status Report.
    (1) Grantees shall submit annual performance reports unless the 
awarding agency requires quarterly or semi-annual reports. However, 
performance reports will not be required more frequently than quarterly. 
Annual reports shall be due 90 days after the grant year, quarterly or 
semi-annual reports shall be due 30 days after the reporting period. The 
final performance report will be due 90 days after the expiration or 
termination of grant support. If a justified request is submitted by a 
grantee, the Federal agency may extend the due date for any performance 
report. Additionally, requirements for unnecessary performance reports 
may be waived by the Federal agency.
    (2) Performance reports will contain, for each grant, brief 
information on the following:
    (i) A comparison of actual accomplishments to the objectives 
established for the period. Where the output of the project can be 
quantified, a computation of the cost per unit of output may be required 
if that information will be useful.
    (ii) The reasons for slippage if established objectives were not 
met.
    (iii) Additional pertinent information including, when appropriate, 
analysis and explanation of cost overruns or high unit costs.
    (3) Grantees will not be required to submit more than the original 
and two copies of performance reports.
    (4) Grantees will adhere to the standards in this section in 
prescribing performance reporting requirements for subgrantees.
    (c) Construction performance reports. For the most part, on-site 
technical inspections and certified percentage-of-completion data are 
relied on heavily by Federal agencies to monitor progress under 
construction grants and subgrants. The Federal agency will require 
additional formal performance reports only when considered necessary, 
and never more frequently than quarterly.
    (d) Significant developments. Events may occur between the scheduled 
performance reporting dates which have significant impact upon the grant 
or subgrant supported activity. In such cases, the grantee must inform 
the Federal agency as soon as the following types of conditions become 
known:
    (1) Problems, delays, or adverse conditions which will materially 
impair the ability to meet the objective of the award. This disclosure 
must include a statement of the action taken, or contemplated, and any 
assistance needed to resolve the situation.
    (2) Favorable developments which enable meeting time schedules and 
objectives sooner or at less cost than anticipated or producing more 
beneficial results than originally planned.
    (e) Federal agencies may make site visits as warranted by program 
needs.
    (f) Waivers, extensions. (1) Federal agencies may waive any 
performance report required by this part if not needed.
    (2) The grantee may waive any performance report from a subgrantee 
when not needed. The grantee may extend the due date for any performance 
report from a subgrantee if the grantee will still be able to meet its 
performance reporting obligations to the Federal agency.



Sec. 13.41  Financial reporting.

    (a) General. (1) Except as provided in paragraphs (a) (2) and (5) of 
this section, grantees will use only the forms specified in paragraphs 
(a) through (e) of this section, and such supplementary or other forms 
as may from time to time be authorized by OMB, for:
    (i) Submitting financial reports to Federal agencies, or
    (ii) Requesting advances or reimbursements when letters of credit 
are not used.
    (2) Grantees need not apply the forms prescribed in this section in 
dealing with their subgrantees. However,

[[Page 168]]

grantees shall not impose more burdensome requirements on subgrantees.
    (3) Grantees shall follow all applicable standard and supplemental 
Federal agency instructions approved by OMB to the extend required under 
the Paperwork Reduction Act of 1980 for use in connection with forms 
specified in paragraphs (b) through (e) of this section. Federal 
agencies may issue substantive supplementary instructions only with the 
approval of OMB. Federal agencies may shade out or instruct the grantee 
to disregard any line item that the Federal agency finds unnecessary for 
its decisionmaking purposes.
    (4) Grantees will not be required to submit more than the original 
and two copies of forms required under this part.
    (5) Federal agencies may provide computer outputs to grantees to 
expedite or contribute to the accuracy of reporting. Federal agencies 
may accept the required information from grantees in machine usable 
format or computer printouts instead of prescribed forms.
    (6) Federal agencies may waive any report required by this section 
if not needed.
    (7) Federal agencies may extend the due date of any financial report 
upon receiving a justified request from a grantee.
    (b) Financial Status Report--(1) Form. Grantees will use Standard 
Form 269 or 269A, Financial Status Report, to report the status of funds 
for all nonconstruction grants and for construction grants when required 
in accordance with paragraph (e)(2)(iii) of this section.
    (2) Accounting basis. Each grantee will report program outlays and 
program income on a cash or accrual basis as prescribed by the awarding 
agency. If the Federal agency requires accrual information and the 
grantee's accounting records are not normally kept on the accural basis, 
the grantee shall not be required to convert its accounting system but 
shall develop such accrual information through and analysis of the 
documentation on hand.
    (3) Frequency. The Federal agency may prescribe the frequency of the 
report for each project or program. However, the report will not be 
required more frequently than quarterly. If the Federal agency does not 
specify the frequency of the report, it will be submitted annually. A 
final report will be required upon expiration or termination of grant 
support.
    (4) Due date. When reports are required on a quarterly or semiannual 
basis, they will be due 30 days after the reporting period. When 
required on an annual basis, they will be due 90 days after the grant 
year. Final reports will be due 90 days after the expiration or 
termination of grant support.
    (c) Federal Cash Transactions Report--(1) Form. (i) For grants paid 
by letter or credit, Treasury check advances or electronic transfer of 
funds, the grantee will submit the Standard Form 272, Federal Cash 
Transactions Report, and when necessary, its continuation sheet, 
Standard Form 272a, unless the terms of the award exempt the grantee 
from this requirement.
    (ii) These reports will be used by the Federal agency to monitor 
cash advanced to grantees and to obtain disbursement or outlay 
information for each grant from grantees. The format of the report may 
be adapted as appropriate when reporting is to be accomplished with the 
assistance of automatic data processing equipment provided that the 
information to be submitted is not changed in substance.
    (2) Forecasts of Federal cash requirements. Forecasts of Federal 
cash requirements may be required in the ``Remarks'' section of the 
report.
    (3) Cash in hands of subgrantees. When considered necessary and 
feasible by the Federal agency, grantees may be required to report the 
amount of cash advances in excess of three days' needs in the hands of 
their subgrantees or contractors and to provide short narrative 
explanations of actions taken by the grantee to reduce the excess 
balances.
    (4) Frequency and due date. Grantees must submit the report no later 
than 15 working days following the end of each quarter. However, where 
an advance either by letter of credit or electronic transfer of funds is 
authorized at an annualized rate of one million dollars or more, the 
Federal agency may require the report to be submitted within 15 working 
days following the end of each month.

[[Page 169]]

    (d) Request for advance or reimbursement--(1) Advance payments. 
Requests for Treasury check advance payments will be submitted on 
Standard Form 270, Request for Advance or Reimbursement. (This form will 
not be used for drawdowns under a letter of credit, electronic funds 
transfer or when Treasury check advance payments are made to the grantee 
automatically on a predetermined basis.)
    (2) Reimbursements. Requests for reimbursement under nonconstruction 
grants will also be submitted on Standard Form 270. (For reimbursement 
requests under construction grants, see paragraph (e)(1) of this 
section.)
    (3) The frequency for submitting payment requests is treated in 
paragraph (b)(3) of this section.
    (e) Outlay report and request for reimbursement for construction 
programs. (1) Grants that support construction activities paid by 
reimbursement method.
    (i) Requests for reimbursement under construction grants will be 
submitted on Standard Form 271, Outlay Report and Request for 
Reimbursement for Construction Programs. Federal agencies may, however, 
prescribe the Request for Advance or Reimbursement form, specified in 
paragraph (d) of this section, instead of this form.
    (ii) The frequency for submitting reimbursement requests is treated 
in paragraph (b)(3) of this section.
    (2) Grants that support construction activities paid by letter of 
credit, electronic funds transfer or Treasury check advance.
    (i) When a construction grant is paid by letter of credit, 
electronic funds transfer or Treasury check advances, the grantee will 
report its outlays to the Federal agency using Standard Form 271, Outlay 
Report and Request for Reimbursement for Construction Programs. The 
Federal agency will provide any necessary special instruction. However, 
frequency and due date shall be governed by paragraphs (b) (3) and (4) 
of this section.
    (ii) When a construction grant is paid by Treasury check advances 
based on periodic requests from the grantee, the advances will be 
requested on the form specified in paragraph (d) of this section.
    (iii) The Federal agency may substitute the Financial Status Report 
specified in paragraph (b) of this section for the Outlay Report and 
Request for Reimbursement for Construction Programs.
    (3) Accounting basis. The accounting basis for the Outlay Report and 
Request for Reimbursement for Construction Programs shall be governed by 
paragraph (b)(2) of this section.



Sec. 13.42  Retention and access requirements for records.

    (a) Applicability. (1) This section applies to all financial and 
programmatic records, supporting documents, statistical records, and 
other records of grantees or subgrantees which are:
    (i) Required to be maintained by the terms of this part, program 
regulations or the grant agreement, or
    (ii) Otherwise reasonably considered as pertinent to program 
regulations or the grant agreement.
    (2) This section does not apply to records maintained by contractors 
or subcontractors. For a requirement to place a provision concerning 
records in certain kinds of contracts, see Sec. 13.36(i)(10).
    (b) Length of retention period. (1) Except as otherwise provided, 
records must be retained for three years from the starting date 
specified in paragraph (c) of this section.
    (2) If any litigation, claim, negotiation, audit or other action 
involving the records has been started before the expiration of the 3-
year period, the records must be retained until completion of the action 
and resolution of all issues which arise from it, or until the end of 
the regular 3-year period, whichever is later.
    (3) To avoid duplicate recordkeeping, awarding agencies may make 
special arrangements with grantees and subgrantees to retain any records 
which are continuously needed for joint use. The awarding agency will 
request transfer of records to its custody when it determines that the 
records possess long-term retention value. When the records are 
transferred to or maintained by the Federal agency, the 3-year retention 
requirement is not applicable to the grantee or subgrantee.

[[Page 170]]

    (c) Starting date of retention period--(1) General. When grant 
support is continued or renewed at annual or other intervals, the 
retention period for the records of each funding period starts on the 
day the grantee or subgrantee submits to the awarding agency its single 
or last expenditure report for that period. However, if grant support is 
continued or renewed quarterly, the retention period for each year's 
records starts on the day the grantee submits its expenditure report for 
the last quarter of the Federal fiscal year. In all other cases, the 
retention period starts on the day the grantee submits its final 
expenditure report. If an expenditure report has been waived, the 
retention period starts on the day the report would have been due.
    (2) Real property and equipment records. The retention period for 
real property and equipment records starts from the date of the 
disposition or replacement or transfer at the direction of the awarding 
agency.
    (3) Records for income transactions after grant or subgrant support. 
In some cases grantees must report income after the period of grant 
support. Where there is such a requirement, the retention period for the 
records pertaining to the earning of the income starts from the end of 
the grantee's fiscal year in which the income is earned.
    (4) Indirect cost rate proposals, cost allocations plans, etc. This 
paragraph applies to the following types of documents, and their 
supporting records: indirect cost rate computations or proposals, cost 
allocation plans, and any similar accounting computations of the rate at 
which a particular group of costs is chargeable (such as computer usage 
chargeback rates or composite fringe benefit rates).
    (i) If submitted for negotiation. If the proposal, plan, or other 
computation is required to be submitted to the Federal Government (or to 
the grantee) to form the basis for negotiation of the rate, then the 3-
year retention period for its supporting records starts from the date of 
such submission.
    (ii) If not submitted for negotiation. If the proposal, plan, or 
other computation is not required to be submitted to the Federal 
Government (or to the grantee) for negotiation purposes, then the 3-year 
retention period for the proposal plan, or computation and its 
supporting records starts from end of the fiscal year (or other 
accounting period) covered by the proposal, plan, or other computation.
    (d) Substitution of microfilm. Copies made by microfilming, 
photocopying, or similar methods may be substituted for the original 
records.
    (e) Access to records--(1) Records of grantees and subgrantees. The 
awarding agency and the Comptroller General of the United States, or any 
of their authorized representatives, shall have the right of access to 
any pertinent books, documents, papers, or other records of grantees and 
subgrantees which are pertinent to the grant, in order to make audits, 
examinations, excerpts, and transcripts.
    (2) Expiration of right of access. The rights of access in this 
section must not be limited to the required retention period but shall 
last as long as the records are retained.
    (f) Restrictions on public access. The Federal Freedom of 
Information Act (5 U.S.C. 552) does not apply to records Unless required 
by Federal, State, or local law, grantees and subgrantees are not 
required to permit public access to their records.



Sec. 13.43  Enforcement.

    (a) Remedies for noncompliance. If a grantee or subgrantee 
materially fails to comply with any term of an award, whether stated in 
a Federal statute or regulation, an assurance, in a State plan or 
application, a notice of award, or elsewhere, the awarding agency may 
take one or more of the following actions, as appropriate in the 
circumstances:
    (1) Temporarily withhold cash payments pending correction of the 
deficiency by the grantee or subgrantee or more severe enforcement 
action by the awarding agency,
    (2) Disallow (that is, deny both use of funds and matching credit 
for) all or part of the cost of the activity or action not in 
compliance,
    (3) Wholly or partly suspend or terminate the current award for the 
grantee's or subgrantee's program,
    (4) Withhold further awards for the program, or

[[Page 171]]

    (5) Take other remedies that may be legally available.
    (b) Hearings, appeals. In taking an enforcement action, the awarding 
agency will provide the grantee or subgrantee an opportunity for such 
hearing, appeal, or other administrative proceeding to which the grantee 
or subgrantee is entitled under any statute or regulation applicable to 
the action involved.
    (c) Effects of suspension and termination. Costs of grantee or 
subgrantee resulting from obligations incurred by the grantee or 
subgrantee during a suspension or after termination of an award are not 
allowable unless the awarding agency expressly authorizes them in the 
notice of suspension or termination or subsequently. Other grantee or 
subgrantee costs during suspension or after termination which are 
necessary and not reasonably avoidable are allowable if:
    (1) The costs result from obligations which were properly incurred 
by the grantee or subgrantee before the effective date of suspension or 
termination, are not in anticipation of it, and, in the case of a 
termination, are noncancellable, and,
    (2) The costs would be allowable if the award were not suspended or 
expired normally at the end of the funding period in which the 
termination takes effect.
    (d) Relationship to Debarment and Suspension. The enforcement 
remedies identified in this section, including suspension and 
termination, do not preclude grantee or subgrantee from being subject to 
``Debarment and Suspension'' under E.O. 12549 (see Sec. 13.35).



Sec. 13.44  Termination for convenience.

    Except as provided in Sec. 13.43 awards may be terminated in whole 
or in part only as follows:
    (a) By the awarding agency with the consent of the grantee or 
subgrantee in which case the two parties shall agree upon the 
termination conditions, including the effective date and in the case of 
partial termination, the portion to be terminated, or
    (b) By the grantee or subgrantee upon written notification to the 
awarding agency, setting forth the reasons for such termination, the 
effective date, and in the case of partial termination, the portion to 
be terminated. However, if, in the case of a partial termination, the 
awarding agency determines that the remaining portion of the award will 
not accomplish the purposes for which the award was made, the awarding 
agency may terminate the award in its entirety under either Sec. 13.43 
or paragraph (a) of this section.



                 Subpart D--After-The-Grant Requirements



Sec. 13.50  Closeout.

    (a) General. The Federal agency will close out the award when it 
determines that all applicable administrative actions and all required 
work of the grant has been completed.
    (b) Reports. Within 90 days after the expiration or termination of 
the grant, the grantee must submit all financial, performance, and other 
reports required as a condition of the grant. Upon request by the 
grantee, Federal agencies may extend this timeframe. These may include 
but are not limited to:
    (1) Final performance or progress report.
    (2) Financial Status Report (SF 269) or Outlay Report and Request 
for Reimbursement for Construction Programs (SF-271) (as applicable.)
    (3) Final request for payment (SF-270) (if applicable).
    (4) Invention disclosure (if applicable).
    (5) Federally-owned property report:

In accordance with Sec. 13.32(f), a grantee must submit an inventory of 
all federally owned property (as distinct from property acquired with 
grant funds) for which it is accountable and request disposition 
instructions from the Federal agency of property no longer needed.
    (c) Cost adjustment. The Federal agency will, within 90 days after 
receipt of reports in paragraph (b) of this section, make upward or 
downward adjustments to the allowable costs.
    (d) Cash adjustments. (1) The Federal agency will make prompt 
payment to the grantee for allowable reimbursable costs.
    (2) The grantee must immediately refund to the Federal agency any 
balance of unobligated (unencumbered) cash

[[Page 172]]

advanced that is not authorized to be retained for use on other grants.



Sec. 13.51  Later disallowances and adjustments.

    The closeout of a grant does not affect:
    (a) The Federal agency's right to disallow costs and recover funds 
on the basis of a later audit or other review;
    (b) The grantee's obligation to return any funds due as a result of 
later refunds, corrections, or other transactions;
    (c) Records retention as required in Sec. 13.42;
    (d) Property management requirements in Secs. 13.31 and 13.32; and
    (e) Audit requirements in Sec. 13.26.



Sec. 13.52  Collection of amounts due.

    (a) Any funds paid to a grantee in excess of the amount to which the 
grantee is finally determined to be entitled under the terms of the 
award constitute a debt to the Federal Government. If not paid within a 
reasonable period after demand, the Federal agency may reduce the debt 
by:
    (1) Making an adminstrative offset against other requests for 
reimbursements,
    (2) Withholding advance payments otherwise due to the grantee, or
    (3) Other action permitted by law.
    (b) Except where otherwise provided by statutes or regulations, the 
Federal agency will charge interest on an overdue debt in accordance 
with the Federal Claims Collection Standards (4 CFR Chapter II). The 
date from which interest is computed is not extended by litigation or 
the filing of any form of appeal.



                    Subpart E--Entitlement [Reserved]



PART 14--ADMINISTRATION OF GRANTS: AUDITS OF STATE AND LOCAL GOVERNMENTS--Table of Contents




Sec.
14.1  Scope of part.
14.2  Non-Federal audits.

Appendix A to Part 14--OMB Circular A-128, ``Audits of State and Local 
          Governments''

    Authority: Reorganization Plan No. 3 of 1978; E.O. 12127, E.O. 
12148, 31 U.S.C. 7505.

    Source: 51 FR 24347, July 3, 1986, unless otherwise noted.



Sec. 14.1  Scope of part.

    (a) This part contains standards for non-Federal audits of 
recipients of financial assistance from the Federal Emergency Management 
Agency (herein called recipients). This includes, without limitation, 
assistance under the Disaster Relief Act of 1974 as amended, and the 
Federal Civil Defense Act of 1950, as amended.
    (b) FEMA may not impose on recipients additional requirements 
concerning non-Federal audits. However, it may provide recipients with 
suggestions and assistance on this subject.



Sec. 14.2  Non-Federal audits.

    (a) Governmental recipients. Recipients that are governments shall 
comply with OMB Circular A-128 including any amendments published in the 
Federal Register by OMB. The Circular is codified verbatim as Appendix A 
to this part.
    (b) Grant or contract audits. Recipients of $25,000 or more, but 
less than $100,000 in Federal financial assistance that choose not to 
have an organization wide single audit must conduct individual grant or 
contract audits on all FEMA awards over $25,000.
    (c) Submission of audit reports. All copies of audit reports that a 
recipient is required under OMB Circular A-128 to submit to FEMA shall 
be addressed to the FEMA District Inspector General responsible for the 
FEMA Region in which the recipient is located. The FEMA Office of 
Inspector General will distribute copies as appropriate within the 
Agency. Recipients therefore are not required to send their audit 
reports to any FEMA officials other than the responsible District 
Inspector General.

 Appendix A to Part 14--OMB Circular A-128, ``Audits of State and Local 
                              Governments''

                    EXECUTIVE OFFICE OF THE PRESIDENT

                     Office of Management and Budget

                           CIRCULAR NO. A-128

                             April 12, 1985

To the Heads of Executive Departments and Establishments.

[[Page 173]]

Subject: Audits of State and Local Governments.

    1. Purpose. This Circular is issued pursuant to the Single Audit Act 
of 1984, Public Law 98-502. It establishes audit requirements for State 
and local governments that receive Federal aid, and defines Federal 
responsibilities for implementing and monitoring those requirements.
    2. Supersession. The Circular supersedes Attachment P, ``Audit 
Requirements,'' of Circular A-102, ``Uniform requirements for grants to 
State and local governments.''
    3. Background. The Single Audit Act builds upon earlier efforts to 
improve audits of Federal aid programs. The Act requires State or local 
governments that receive $100,000 or more a year in Federal funds to 
have an audit made for that year. Section 7505 of the Act requires the 
Director of the Office of Management and Budget to prescribe policies, 
procedures and guidelines to implement the Act. It specifies that the 
Director shall designate ``cognizant'' Federal agencies, determine 
criteria for making appropriate charges to Federal programs for the cost 
of audits, and provide procedures to assure that small firms or firms 
owned and controlled by disadvantaged individuals have the opportunity 
to participate in contracts for single audits.
    4. Policy. The Single Audit Act requires the following:
    a. State or local governments that receive $100,000 or more a year 
in Federal financial assistance shall have an audit made in accordance 
with this Circular.
    b. State or local governments that receive between $25,000 and 
$100,000 a year shall have an audit made in accordance with this 
Circular, or in accordance with Federal laws and regulations governing 
the programs they participate in.
    c. State or local governments that receive less than $25,000 a year 
shall be exempt from compliance with the Act and other Federal audit 
requirements. These State and local governments shall be governed by 
audit requirements prescribed by State or local law or regulation.
    d. Nothing in this paragraph exempts State or local governments from 
maintaining records of Federal financial assistance or from providing 
access to such records to Federal agencies, as provided for in Federal 
law or in Circular A-102, ``Uniform requirements for grants to State or 
local governments.''
    5. Definitions. For the purposes of this Circular the following 
definitions from the Single Audit Act apply:
    a. Cognizant agency means the Federal agency assigned by the Office 
of Management and Budget to carry out the responsibilities described in 
paragraph 11 of this Circular.
    b. Federal financial assistance means assistance provided by a 
Federal agency in the form of grants, contracts, cooperative agreements, 
loans, loan guarantees, property, interest subsidies, insurance, or 
direct appropriations, but does not include direct Federal cash 
assistance to individuals. It includes awards received directly from 
Federal agencies, or indirectly through other units of State and local 
governments.
    c. Federal agency has the same meaning as the term agency in section 
551(1) of title 5, United States Code.
    d. Generally accepted accounting principles has the meaning 
specified in the generally accepted government auditing standards.
    e. Generally accepted government auditing standards means the 
Standards For Audit of Government Organizations, Programs, Activities, 
and Functions, developed by the Comptroller General, dated Febuary 27, 
1981.
    f. Independent auditor means:
    (1) A State or local government auditor who meets the independence 
standards specified in generally accepted government auditing standards; 
or
    (2) A public accountant who meets such independence standards.
    g. Internal controls means the plan of organization and methods and 
procedures adopted by management to ensure that:
    (1) Resource use is consistent with laws, regulations, and policies;
    (2) Resources are safeguarded against waste, loss, and misuse; and
    (3) Reliable data are obtained, maintained, and fairly disclosed in 
reports.
    h. Indian tribe means any Indian tribe, band, nations, or other 
organized group or community, including any Alaskan Native village or 
regional or village corporations (as defined in, or established under, 
the Alaskan Native Claims Settlement Act) that is recognized by the 
United States as eligible for the special programs and services provided 
by the United States to Indians because of their status as Indians.
    i. Local government means any unit of local government within a 
State, including a county, a borough, municipality, city, town, 
township, parish, local public authority, special district, school 
district, intrastate district, council of governments, and any other 
instrumentality of local government.
    j. Major Federal Assistance Program, as defined by Public Law 98-
502, is described in the Attachment to this Circular.
    k. Public accountants means those individuals who meet the 
qualification standards included in generally accepted government 
auditing standards for personnel performing government audits.
    l. State means any State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, Guam, 
American Samoa, the Commonwealth of the Northern Mariana Islands,

[[Page 174]]

and the Trust Territory of the Pacific Islands, any instrumentality 
thereof, and any multi-State, regional, or interstate entity that has 
governmental functions and any Indian tribe.
    m. Subrecipient means any person or government department, agency, 
or establishment that receives Federal financial assistance to carry out 
a program through a State or local government, but does not include an 
individual that is a beneficiary of such a program. A subrecipient may 
also be a direct recipient of Federal financial assistance.
    6. Scope of audit. The Single Audit Act provides that:
    a. The audit shall be made by an independent auditor in accordance 
with generally accepted government auditing standards covering financial 
and compliance audits.
    b. The audit shall cover the entire operations of a State or local 
government or, at the option of that government, it may cover 
departments, agencies or establishments that received, expended, or 
otherwise administered Federal financial assistance during the year. 
However, if a State or local government receives $25,000 or more in 
General Revenue Sharing Funds in a fiscal year, it shall have an audit 
of its entire operations. A series of audits of individual departments, 
agencies, and establishments for the same fiscal year may be considered 
a single audit.
    c. Public hospitals and public colleges and universities may be 
excluded from State and local audits and the requirements of this 
Circular. However, if such entities are excluded, audits of these 
entities shall be made in accordance with statutory requirements and the 
provisions of Circular A-110, ``Uniform requirements for grants to 
universities, hospitals, and other nonprofit organizations.''
    d. The auditor shall determine whether:
    (1) The financial statements of the government, department, agency 
or establishment present fairly its financial position and the results 
of its financial operations in accordance with generally accepted 
accounting principles;
    (2) The organization has internal accounting and other control 
systems to provide reasonable assurance that it is managing Federal 
financial assistance programs in compliance with applicable laws and 
regulations; and
    (3) The organization has complied with laws and regulations that may 
have material effect on its financial statements and on each major 
Federal assistance program.
    7. Frequency of audit. Audits shall be made annually unless the 
State or local government has, by January 1, 1987, a constitutional or 
statutory requirement for less frequent audits. For those governments, 
the cognizant agency shall permit biennial audits, covering both years, 
if the government so requests. It shall also honor requests for biennial 
audits by governments that have an administrative policy calling for 
audits less frequent than annual, but only for fiscal years beginning 
before January 1, 1987.
    8. Internal control and compliance reviews. The Single Audit Act 
requires that the independent auditor determine and report on whether 
the organization has internal control systems to provide reasonable 
assurance that it is managing Federal assistance programs in compliance 
with applicable laws and regulations.
    a. Internal control review. In order to provide this assurance the 
auditor must make a study and evaluation of internal control systems 
used in administering Federal assistance programs. The study and 
evaluation must be made whether or not the auditor intends to place 
reliance on such systems. As part of this review, the auditor shall:
    (1) Test whether these internal control systems are functioning in 
accordance with prescribed procedures.
    (2) Examine the recipient's system for monitoring subrecipients and 
obtaining and acting on subrecipient audit reports.
    b. Compliance review. The law also requires the auditor to determine 
whether the organization has complied with laws and regulations that may 
have a material effect on each major Federal assistance program.
    (1) In order to determine which major programs are to be tested for 
compliance, State and local governments shall identify in their accounts 
all Federal funds received and expended and the programs under which 
they were received. This shall include funds received directly from 
Federal agencies and through other State and local governments.
    (2) The review must include the selection and testing of a 
representative number of charges from each major Federal assistance 
program. The selection and testing of transactions shall be based on the 
auditor's professional judgment considering such factors as the amount 
of expeditures for the program and the individual awards; the newness of 
the program or changes in its conditions; prior experience with the 
program, particularly as revealed in audits and other evaluations (e.g., 
inspections, program reviews); the extent to which the program is 
carried out through subrecipients; the extent to which the program 
contracts for goods or services; the level to which the program is 
already subject to program reviews or other forms of independent 
oversight; the adequacy of the controls for ensuring compliance; the 
expectation of adherence or lack of adherence to the applicable laws and 
regulations; and the potential impact of adverse findings.
    (a) In making the test of transactions, the auditor shall determine 
whether:

--The amounts reported as expenditures were for allowable services, and

[[Page 175]]

--The records show that those who received services or benefits were 
eligible to receive them.

    (b) In addition to transaction testing, the auditor shall determine 
whether:

--Matching requirements, levels of effort and earmarking limitations 
were met,
--Federal financial reports and claims for advances and reimbursements 
contain information that is supported by the books and records from 
which the basic financial statements have been prepared, and
--Amounts claimed or used for matching were determined in accordance 
with OMB Circular A-87, ``Cost principles for State and local 
governments,'' and Attachment F of Circular A-102, ``Uniform 
requirements for grants to State and local governments.''

    (c) The principal compliance requirements of the largest Federal aid 
programs may be ascertained by referring to the Compliance Supplement 
for Single Audits of State and Local Governments, issued by OMB and 
available from the Government Printing Office. For those programs not 
covered in the Compliance Supplement, the auditor may ascertain 
compliance requirements by researching the statutes, regulations, and 
agreements governing individual programs.
    (3) Transactions related to other Federal assistance programs that 
are selected in connection with examinations of financial statements and 
evaluations of internal controls shall be tested for compliance with 
Federal laws and regulations that apply to such transactions.
    9. Subrecipients. State or local governments that receive Federal 
financial assistance and provide $25,000 or more of it in a fiscal year 
to a subrecipient shall:
    a. Determine whether State or local subrecipients have met the audit 
requirements of this Circular and whether subrecipients covered by 
Circular A-110, ``Uniform requirements for grants to universities, 
hospitals, and other nonprofit organizations,'' have met that 
requirement;
    b. Determine whether the subrecipient spent Federal assistance funds 
provided in accordance with applicable laws and regulations. This may be 
accomplished by reviewing an audit of the subrecipient made in 
accordance with this Circular, Circular A-110, or through other means 
(e.g., program reviews) if the subrecipient has not yet had such an 
audit;
    c. Ensure that appropriate corrective action is taken within six 
months after receipt of the audit report in instances of noncompliance 
with Federal laws and regulations;
    d. Consider whether subrecipient audits necessitate adjustment of 
the recipient's own records; and
    e. Require each subrecipient to permit independent auditors to have 
access to the records and financial statements as necessary to comply 
with this Circular.
    10. Relation to other audit requirements. The Single Audit Act 
provides that an audit made in accordance with this Circular shall be in 
lieu of any financial or financial compliance audit required under 
individual Federal assistance programs. To the extent that a single 
audit provides Federal agencies with information and assurances they 
need to carry out their overall responsibilities, they shall rely upon 
and use such information. However, a Federal agency shall make any 
additional audits which are necessary to carry out its responsibilities 
under Federal law and regulation. Any additional Federal audit effort 
shall be planned and carried out in such a way as to avoid duplication.
    a. The provisions of this Circular do not limit the authority of 
Federal agencies to make, or contract for audits and evaluations of 
Federal financial assistance programs, nor do they limit the authority 
of any Federal agency Inspector General or other Federal audit official.
    b. The provisions of this Circular do not authorize any State or 
local government or subrecipient thereof to constrain Federal agencies, 
in any manner, from carrying out additional audits.
    c. A Federal agency that makes or contracts for audits in addition 
to the audits made by recipients pursuant to this Circular shall, 
consistent with other applicable laws and regulations, arrange for 
funding the cost of such additional audits. Such additional audits 
include economy and efficiency audits, program results audits, and 
program evaluations.
    11. Cognizant agency responsibilities. The Single Audit Act provides 
for cognizant Federal agencies to oversee the implementation of this 
Circular.
    a. The Office of Management and Budget will assign cognizant 
agencies for States and their subdivisions and larger local governments 
and their subdivisions. Other Federal agencies may participate with an 
assigned cognizant agency, in order to fulfill the cognizance 
responsibilities. Smaller governments not assigned a cognizant agency 
will be under the general oversight of the Federal agency that provides 
them the most funds whether directly or indirectly.
    b. A cognizant agency shall have the following responsibilities:
    (1) Ensure that audits are made and reports are received in a timely 
manner and in accordance with the requirements of this Circular.
    (2) Provide technical advice and liaison to State and local 
governments and independent auditors.
    (3) Obtain or make quality control reviews of selected audits made 
by non-Federal audit

[[Page 176]]

organizations, and provide the results, when appropriate, to other 
interested organizations.
    (4) Promptly inform other affected Federal agencies and appropriate 
Federal law enforcement officials of any reported illegal acts or 
irregularities. They should also inform State or local law enforcement 
and prosecuting authorities, if not advised by the recipient, of any 
violation of law within their jurisdiction.
    (5) Advise the recipient of audits that have been found not to have 
met the requirements set forth in this Circular. In such instances, the 
recipient will be expected to work with the auditor to take corrective 
action. If corrective action is not taken, the cognizant agency shall 
notify the recipient and Federal awarding agencies of the facts and make 
recommendations for followup action. Major inadequacies or repetitive 
substandard performance of independent auditors shall be referred to 
appropriate professional bodies for disciplinary action.
    (6) Coordinate, to the extent practicable, audits made by or for 
Federal agencies that are in addition to the audits made pursuant to 
this Circular; so that the additional audits build upon such audits.
    (7) Oversee the resolution of audit findings that affect the 
programs of more than one agency.
    12. Illegal acts or irregularities. If the auditor becomes aware of 
illegal acts or other irregularities, prompt notice shall be given to 
recipient management officials above the level of involvement. (See also 
paragraph 13(a)(3) of this appendix for the auditor's reporting 
responsibilities.) The recipient, in turn, shall promptly notify the 
cognizant agency of the illegal acts or irregularities and of proposed 
and actual actions, if any. Illegal acts and irregularities include such 
matters as conflicts of interest, falsification of records or reports, 
and misappropriations of funds or other assets.
    13. Audit Reports. Audit reports must be prepared at the completion 
of the audit. Reports serve many needs of State and local governments as 
well as meeting the requirements of the Single Audit Act.
    a. The audit report shall state that the audit was made in 
accordance with the provisions of this Circular. The report shall be 
made up of at least:
    (1) The auditor's report on financial statements and on a schedule 
of Federal assistance; the financial statements; and a schedule of 
Federal assistance, showing the total expenditures for each Federal 
assistance program as identified in the Catalog of Federal Domestic 
Assistance. Federal programs or grants that have not been assigned a 
catalog number shall be identified under the caption ``other Federal 
assistance.''
    (2) The auditor's report on the study and evaluation of internal 
control systems must identify the organization's significant internal 
accounting controls, and those controls designed to provide reasonable 
assurance that Federal programs are being managed in compliance with 
laws and regulations. It must also identify the controls that were 
evaluated, the controls that were not evaluated, and the material 
weaknesses identified as a result of the evaluation.
    (3) The auditor's report on compliance containing:

--A statement of positive assurance with respect to those items tested 
for compliance, including compliance with law and regulations pertaining 
to financial reports and claims for advances and reimbursements;
--Negative assurance on those items not tested;
--A summary of all instances of noncompliance; and
--An identification of total amounts questioned, if any, for each 
Federal assistance award, as a result of noncompliance.

    b. The three parts of the audit report may be bound into a single 
report, or presented at the same time as separate documents.
    c. All fraud abuse, or illegal acts or indications of such acts, 
including all questioned costs found as the result of these acts that 
auditors become aware of, should normally be covered in a separate 
written report submitted in accordance with paragraph 13f of this 
appendix.
    d. In addition to the audit report, the recipient shall provide 
comments on the findings and recommendations in the report, including a 
plan for corrective action taken or planned and comments on the status 
of corrective action taken on prior findings. If corrective action is 
not necessary, a statement describing the reason it is not should 
accompany the audit report.
    e. The reports shall be made available by the State or local 
government for public inspection within 30 days after the completion of 
the audit.
    f. In accordance with generally accepted government audit standards, 
reports shall be submitted by the auditor to the organization audited 
and to those requiring or arranging for the audit. In addition, the 
recipient shall submit copies of the reports to each Federal department 
or agency that provided Federal assistance funds to the recipient. 
Subrecipients shall submit copies to recipients that provided them 
Federal assistance funds. The reports shall be sent within 30 days after 
the completion of the audit, but no later than one year after the end of 
the audit period unless a longer period is agreed to with the cognizant 
agency.
    g. Recipients of more than $100,000 in Federal funds shall submit 
one copy of the audit report within 30 days after issuance to a central 
clearinghouse to be designated by the Office of Management and Budget. 
The

[[Page 177]]

clearinghouse will keep completed audits on file and follow up with 
State and local governments that have not submitted required audit 
reports.
    h. Recipients shall keep audit reports on file for three years from 
their issuance.
    14. Audit Resolution. As provided in paragraph 11, the cognizant 
agency shall be responsible for monitoring the resolution of audit 
findings that affect the programs of more than one Federal agency. 
Resolution of findings that relate to the programs of a single Federal 
agency will be the responsibility of the recipient and that agency. 
Alternate arrangements may be made on a case-by-case basis by agreement 
among the agencies concerned.
    Resolution shall be made within six months after receipt of the 
report by the Federal departments and agencies. Corrective action should 
proceed as rapidly as possible.
    15. Audit workpapers and reports. Workpapers and reports shall be 
retained for a minimum of three years from the date of the audit report, 
unless the auditor is notified in writing by the cognizant agency to 
extend the retention period. Audit workpapers shall be made available 
upon request to the cognizant agency or its designee or the General 
Accounting Office, at the completion of the audit.
    16. Audit Costs. The cost of audits made in accordance with the 
provisions of this Circular are allowable charges to Federal assistance 
programs.
    a. The charges may be considered a direct cost or an allocated 
indirect cost, determined in accordance with the provision of Circular 
A-87, ``Cost principles for State and local governments.''
    b. Generally, the percentage of costs charged to Federal assistance 
programs for a single audit shall not exceed the percentage that Federal 
funds expended represent of total funds expended by the recipient during 
the fiscal year. The percentage may be exceeded, however, if appropriate 
documentation demonstrates higher actual cost.
    17. Sanctions. The Single Audit Act provides that no cost may be 
charged to Federal assistance programs for audits required by the Act 
that are not made in accordance with this Circular. In cases of 
continued inability or unwillingness to have a proper audit, Federal 
agencies must consider other appropriate sanctions including:

--Withholding a percentage of assistance payments until the audit is 
completed satisfactorily,
--Withholding or disallowing overhead costs, and
--Suspending the Federal assistance agreement until the audit is made.

    18. Auditor Selection. In arranging for audit services State and 
local governments shall follow the procurement standards prescribed by 
Attachment O of Circular A-102, ``Uniform requirements for grants to 
State and local governments.'' The standards provide that while 
recipients are encouraged to enter into intergovernmental agreements for 
audit and other services, analysis should be made to determine whether 
it would be more economical to purchase the services from private firms. 
In instances where use of such intergovernmental agreements are required 
by State statutes (e.g., audit services) these statutes will take 
precedence.
    19. Small and Minority Audit Firms. Small audit firms and audit 
firms owned and controlled by socially and economically disadvantaged 
individuals shall have the maximum practicable opportunity to 
participate in contracts awarded to fulfill the requirements of this 
Circular. Recipients of Federal assistance shall take the following 
steps to further this goal:
    a. Assure that small audit firms and audit firms owned and 
controlled by socially and economically disadvantaged individuals are 
used to the fullest extent practicable.
    b. Make information on forthcoming opportunities available and 
arrange timeframes for the audit so as to encourage and facilitate 
participation by small audit firms and audit firms owned and controlled 
by socially and economically disadvantaged individuals.
    c. Consider in the contract process whether firms competing for 
larger audits intend to subcontract with small audit firms and audit 
firms owned and controlled by socially and economically disadvantaged 
individuals.
    d. Encourage contracting with small audit firms or audit firms owned 
and controlled by socially and economically disadvantaged individuals 
which have traditionally audited government programs and, in such cases 
where this is not possible, assure that these firms are given 
consideration for audit subcontracting opportunities.
    e. Encourage contracting with consortiums of small audit firms as 
described in paragraph (a) of section 19 of this appendix when a 
contract is too large for an individual small audit firm or audit firm 
owned and controlled by socially and economically disadvantaged 
individuals.
    f. Use the services and assistance, as appropriate, of such 
organizations as the Small Business Administration in the solicitation 
and utilization of small audit firms or audit firms owned and controlled 
by socially and economically disadvantaged individuals.
    20. Reporting. Each Federal agency will report to the Director of 
OMB on or before March 1, 1987, and annually thereafter on the 
effectiveness of State and local governments in carrying out the 
provisions of this Circular. The report must identify each State or 
local government or Indian tribe that, in the

[[Page 178]]

opinion of the agency, is failing to comply with the Circular.
    21. Regulations. Each Federal agency shall include the provisions of 
this Circular in its regulations implementing the Single Audit Act.
    22. Effective date. This Circular is effective upon publication and 
shall apply to fiscal years of State and local governments that begin 
after December 31, 1984. Earlier implementation is encouraged. However, 
until it is implemented, the audit provisions of Attachment P to 
Circular A-102 shall continue to be observed.
    23. Inquiries. All questions or inquiries should be addressed to 
Financial Management Division, Office of Management and Budget, 
telephone number 202/395-3993.
    24. Sunset review date. This Circular shall have an independent 
policy review to ascertain its effectiveness three years from the date 
of issuance.

                                                      David A. Stockman,
                                                               Director.

                       Attachment--Circular A-128

      Definition of Major Program as Provided in Public Law 98-502

    ``Major Federal Assistance Program,'' for State and local 
governments having Federal assistance expenditures between $100,000 and 
$100,000,000, means any program for which Federal expenditures during 
the applicable year exceed the larger of $300,000, or 3 percent of such 
total expenditures.
    Where total expenditures of Federal assistance exceed $100,000,000, 
the following criteria apply:

                                                                        
------------------------------------------------------------------------
 Total expenditures of Federal financial assistance      Major Federal  
                  for all programs                    assistance program
-----------------------------------------------------  means any program
            More than                But less than       that exceeds   
------------------------------------------------------------------------
$100 million....................  $1 billion........  $3 million.       
$1 billion......................  $2 billion........  $4 million.       
$2 billion......................  $3 billion........  $7 million.       
$3 billion......................  $4 billion........  $10 million.      
$4 billion......................  $5 billion........  $13 million.      
$5 billion......................  $6 billion........  $16 million.      
$6 billion......................  $7 billion........  $19 million.      
Over $7 billion.................  ..................  $20 million.      
------------------------------------------------------------------------



PART 15--CONDUCT AT THE FEMA SPECIAL FACILITY--Table of Contents




             Subpart A--Conduct at the FEMA Special Facility

Sec.
15.1  Applicability.
15.2  Admission.
15.3  Inspection.
15.4  Preservation of property.
15.5  Conformity with signs and directions.
15.6  Disturbances.
15.7  Gambling.
15.8  Alcoholic beverages and narcotics.
15.9  Soliciting, vending, and debt collection.
15.10  Distribution of handbills.
15.11  Photographs and other depictions.
15.12  Dogs and other animals.
15.13  Vehicular and pedestrian traffic.
15.14  Weapons and explosives.
15.15  Penalties and other laws.

      Subpart B--Conduct at the National Emergency Training Center

15.31  Purpose.
15.32  Applicability.
15.33  Inspection.
15.34  Preservation of property.
15.35  Conformity with signs and directions.
15.36  Disturbances.
15.37  Gambling.
15.38  Alcoholic beverages and narcotics.
15.39  Soliciting, vending and debt collection.
15.40  Distribution of handbills.
15.41  Photographs and other depictions.
15.42  Dogs and other animals.
15.43  Vehicular and pedestrian traffic.
15.44  Weapons and explosives.
15.45  Penalties.
15.46  Other laws.

    Authority: FEMA Reorganization Plan No. 3 of 1978; E.O. 12127; E.O. 
12148; delegation of authority from the Administrator of General 
Services, dated July 18, 1979; Pub. L. 566, 80th Congress, approved June 
1, 1948 (40 U.S.C. 318-318d); and the Federal Property and 
Administrative Services Act of 1949 (63 Stat. 377), as amended.

    Source: 49 FR 20498, May 15, 1984, unless otherwise noted.



             Subpart A--Conduct at the FEMA Special Facility



Sec. 15.1  Applicability.

    These rules and regulations apply to all the property known as the 
``Special Facility,'' located on Mt. Weather on Virginia Route 601 near 
Berryville, Virginia, which is owned, operated or under the charge and 
control of the Federal Emergency Management Agency (FEMA) and to all 
persons entering, while on, or leaving the property.



Sec. 15.2  Admission.

    The Special Facility contains classified material and areas which 
must be

[[Page 179]]

protected in the interest of national security. The facility is 
designated a restricted area. Access to the Special Facility is closed 
to the general public and is limited to those persons having official 
business related to the missions and operations of the Special Facility. 
Persons and vehicles entering the Special Facility must be approved for 
admission by the Director, Federal Emergency Management Agency, or his/
her designee, registered with the Special Facility security force, and 
issued a Special Facility identification badge and vehicle parking decal 
or permit. No person shall enter or remain on the Special Facility 
premises unless he or she has received permission from the Director, 
FEMA or his/her designee and has complied with the above procedures.



Sec. 15.3  Inspection.

    All vehicles, packages, handbags, briefcases, and other containers 
being brought into, while on, or being removed from the Special Facility 
are subject to inspection by security force personnel and other 
authorized personnel. A full search may accompany an arrest. Inspection 
is permitted to prevent the possession and use of items prohibited by 
these rules and regulations or by other applicable laws, to prevent 
theft of property and to prevent the wrongful obtaining of defense 
information under 18 U.S.C. 793. Individuals objecting to such 
inspections must make their objection known to the officer on duty at 
the entrance gate prior to entering the Special Facility. Individuals 
refusing to permit an inspection of their vehicle or possessions will 
not be authorized or allowed to enter the premises of the Special 
Facility.



Sec. 15.4  Preservation of property.

    The improper disposal of rubbish at the Special Facility, the 
willful destruction of or damage to property, the theft of property, the 
creation of any hazard on the property to persons or things, the 
throwing of articles of any kind from or at a building, or the climbing 
upon a fence, or the climbing upon the roof or any part of a building is 
prohibited.



Sec. 15.5  Conformity with signs and directions.

    Persons at the Special Facility shall at all times comply with 
official signs of a prohibitory, regulatory, or directory nature and 
with the directions of law enforcement and other authorized officials.



Sec. 15.6  Disturbances.

    Any unwarranted loitering, disorderly conduct, or other conduct at 
the Special Facility which creates loud or unusual noise or a nuisance; 
which unreasonably obstructs the usual use of entrances, foyers, 
lobbies, corridors, offices, elevators, stairways, roadways or parking 
lots; which otherwise impedes or disrupts the performance of official 
duties by government employees; or which prevents persons from obtaining 
the administrative services provided at the Special Facility in a timely 
manner, is prohibited.



Sec. 15.7  Gambling.

    Participating in games for money or other personal property, or the 
operating of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets at the Special Facility is 
prohibited.



Sec. 15.8  Alcoholic beverages and narcotics.

    Operating a motor vehicle at the Special Facility by a person under 
the influence of alcoholic beverages, narcotic drugs, hallucinogens, 
marijuana, barbiturates or amphetamines is prohibited. Entering upon, or 
while on the property, under the influence of or using or possessing any 
narcotic drug, marijuana, hallucinogen, barbiturate or amphetamine is 
prohibited. This prohibition shall not apply in cases where the drug has 
been prescribed for a patient by a physician. Entering upon the 
property, or being on the property under the influence of alcoholic 
beverages is prohibited. Bringing alcoholic beverages, narcotic drugs, 
hallucinogens, marijuana, barbiturates or amphetamines onto the premises 
of the Special Facility is prohibited unless authorization has been 
granted by the Director, FEMA or his designee.

[[Page 180]]



Sec. 15.9  Soliciting, vending, and debt collection.

    Soliciting alms and contributions, commercial or political 
soliciting and vending of all kinds, displaying or distributing 
commercial advertising, or collecting private debts at the Special 
Facility is prohibited. This rule does not apply to (a) national or 
local drives for funds for welfare, health, or other purposes as 
authorized by the ``Manual on Fund Raising Within the Federal Service'' 
issued by the U.S. Office of Personnel Management and sponsored or 
approved by the occupant agencies (all such drives must have the prior 
approval of the Director, Federal Emergency Management Agency or his/her 
designee); (b) concessions or personal notices posted by employees on 
authorized bulletin boards; and (c) solicitation of labor organization 
membership or dues authorized by occupant agencies under the Civil 
Service Reform Act of 1978 (Pub. L. 95-454).



Sec. 15.10  Distribution of handbills.

    The distribution of materials such as pamphlets, handbills and/or 
flyers, and the displaying of placards or posting of materials on 
bulletin boards or elsewhere at the Special Facility is prohibited 
except as authorized in Sec. 15.9 of this part or when such distribution 
or displays are conducted as part of authorized government activities.



Sec. 15.11  Photographs and other depictions.

    The taking of photographs and the making of notes, sketches, or 
diagrams of buildings, grounds or other appurtenances of the Special 
Facility, or the possession of a camera is prohibited while at the 
Special Facility except when approved by the Director, Federal Emergency 
Management Agency, or his/her designee.



Sec. 15.12  Dogs and other animals.

    Dogs and other animals, except seeing-eye dogs, shall not be brought 
onto the Special Facility for other than official purposes.



Sec. 15.13  Vehicular and pedestrian traffic.

    (a) Drivers of all vehicles entering or while at the Special 
Facility shall drive in a careful and safe manner at all times and shall 
comply with the signals and directions of security force officers or 
other authorized individuals and all posted traffic signs;
    (b) The blocking of entrances, driveways, walks, loading platforms, 
or fire hydrants on the property is prohibited;
    (c) Except in emergencies, parking on the property is not allowed 
without a permit. Parking without authority, parking in unauthorized 
locations or in locations reserved for other persons, or parking 
contrary to the direction of posted signs is prohibited. Vehicles parked 
in violation, where warning signs are posted, shall be subject to 
removal at the owners' risk and expense. This paragraph may be 
supplemented from time to time with the approval of the Director of 
Federal Emergency Management Agency, or his/her designee, by the 
issuance and posting of such specific traffic directives as may be 
required, and when so issued and posted such directives shall have the 
same force and effect as if made a part thereof. Proof that a motor 
vehicle was parked in violation of these regulations or directives may 
be taken as prima facie evidence that the registered owner was 
responsible for the violation.



Sec. 15.14  Weapons and explosives.

    No person entering or while at the Special Facility shall carry or 
possess firearms, other dangerous or deadly weapons, explosives or items 
intended to be used or which could reasonably be used to fabricate an 
explosive or incendiary device, either openly or concealed, except for 
official purposes and upon the approval of the Director, Federal 
Emergency Management Agency, or his/her designee.



Sec. 15.15  Penalties and other laws.

    Whoever shall be found guilty of violating any rule or regulation 
herein is subject to a fine of not more than $50 or imprisonment for not 
more than 30 days, or both. (See 40 U.S.C. 318c.) Nothing contained in 
these rules and regulations shall be construed to abrogate any other 
Federal laws or any State and local laws and regulations applicable to 
the Special Facility premises. These rules and regulations

[[Page 181]]

supplement those penal provisions of Title 18, United States Code, 
relating to Crimes and Criminal Procedure, which apply without regard to 
the place of the offense and those penal provisions which apply in areas 
under the special maritime and territorial jurisdiction of the United 
States, as defined in 18 U.S.C. 7. However, they supersede those 
provisions of State law which are made Federal criminal offenses by 
virtue of the Assimilated Crimes Act (18 U.S.C. 13) to the extent that 
they are in conflict with these regulations. State and local criminal 
laws are applicable as such only to the extent that authority in that 
regard has been reserved to the State by the State consent or cession 
statute or vested in the State by Federal statute.



      Subpart B--Conduct at the National Emergency Training Center

    Authorities: EO 11222, EO 12148, Federal Fire Prevention and Control 
Act of 1974, Pub. L. 93-498, 15 USC 2201, et seq.

    Source: 56 FR 19597, April 29, 1991, unless otherwise noted.



Sec. 15.31  Purpose.

    To set forth the National Emergency Training Center (NETC) policy 
and procedure relating to the NETC grounds and buildings and to the 
conduct of all persons entering, while on, and leaving the NETC, and 
actions to be taken for violation of these rules and regulations.



Sec. 15.32  Applicability.

    This subpart applies to all the property known as the ``National 
Emergency Training Center,'' located on 16825 South Seton Avenue in 
Emmitsburg, Maryland, which is owned, operated and controlled by the 
Federal Emergency Management Agency (FEMA) and to all persons entering, 
while on, or leaving the property.



Sec. 15.33  Inspection.

    All vehicles, packages, handbags, briefcases, and other containers 
brought into, while on, or being removed from NETC may be subject to 
inspection. A full search of a person may accompany an arrest or 
apprehension.



Sec. 15.34  Preservation of property.

    The improper disposal of rubbish at NETC, the willful destruction of 
or damage to property, the theft of property, the creation of any hazard 
to persons or things, the throwing of articles of any kind from or at a 
building, or the climbing upon the roof or any part of the building is 
prohibited.



Sec. 15.35  Conformity with signs and directions.

    Persons in and on the NETC shall at all times comply with official 
signs of a prohibitory, regulatory, or directory nature and with the 
direction of the security force or other authorized individuals.



Sec. 15.36  Disturbances.

    Any unwarranted loitering, disorderly conduct, or other conduct at 
NETC which creates loud or unusual noise or a nuisance; which 
unreasonably obstructs the usual use of classrooms, dormitory rooms, 
entrances, foyers, lobbies, corridors, offices, elevators, stairways, 
roadways or parking lots; which otherwise impedes or disrupts the 
performance of official duties by Government employees or Government 
contractors; which interferes with the delivery of the educational 
program; or which prevents the general public from obtaining the 
services provided on the property in a timely manner, is prohibited.



Sec. 15.37  Gambling.

    Participating in games for money or other personal property or the 
operating of gambling devices, the conduct of a lottery or pool, or the 
selling or purchasing of numbers tickets at NETC is prohibited.



Sec. 15.38  Alcoholic beverages and narcotics.

    Operating a motor vehicle at NETC by a person under the influence of 
alcoholic beverages, narcotic drugs, hallucinogens, marijuana, 
barbiturates, or amphetamines as defined in the Annotated Code of 
Maryland, Transportation Article, Section or Title 21902 is prohibited. 
Entering

[[Page 182]]

upon, or while on the property under the influence of or using or 
possessing any narcotic drug, hallucinogen, marijuana, or barbiturate, 
or amphetamine is prohibited. This prohibition shall not apply in cases 
where the drug has been prescribed for a patient by a licensed 
physician. Entering upon the property, or being on the property under 
the influence of alcoholic beverages as defined in the Annotated Code of 
Maryland, Transportation Article, Section or Title 21902 is prohibited. 
Bringing alcoholic beverages, narcotic drugs, hallucinogens, marijuana, 
barbiturates or amphetamines onto the premises of NETC is prohibited 
unless the individual has been authorized. The use of alcoholic 
beverages on the property is prohibited except in the Student Center and 
other locations and occasions as authorized in writing by the 
Administrator, U.S. Fire Administration, FEMA, or his/her designee.



Sec. 15.39  Soliciting, vending and debt collection.

    Soliciting alms and contributions, commercial or political 
solicitation and vending of all kinds, displaying or distributing 
commercial advertising, or collecting private debts at NETC are 
prohibited. This does not apply to:
    (a) Approved national or local fund drives for health, welfare, or 
other purposes as authorized by the ``Manual on Fund Raising Within the 
Federal Service'' issued by the U.S. Office of Personnel Management and 
sponsored or approved by the occupant agencies (all such drives must 
have the prior approval of the Administrator, U.S. Fire Administration, 
FEMA or his/her designee);
    (b) Concessions or personal notices posted by employees on 
authorized bulletin boards; and
    (c) Solicitation of labor organization membership or dues authorized 
by occupant agencies under the Civil Service Reform Act of 1978 title 5, 
United States Code, section 1101.



Sec. 15.40  Distribution of handbills.

    The distribution of materials such as pamphlets, handbills, and/or 
flyers, and the displaying of placards or posting of materials on 
bulletin boards or elsewhere at NETC is prohibited except as authorized 
above or when such distribution or displays are conducted as part of 
authorized government activity.



Sec. 15.41  Photographs and other depictions.

    Photographs may be taken inside classroom or office areas only with 
the consent of the occupants. Except where security regulations apply or 
a Federal court order or rule prohibits it, photographs may be taken in 
entrances, lobbies, foyers, corridors, or auditoriums when used for 
public meetings. Subject to the foregoing prohibitions, photographs for 
advertising and commercial purposes may be taken only with written 
permission of the Director, Office of NETC Operations and Support, U.S. 
Fire Administration or other authorized official where the photographs 
are to be taken.



Sec. 15.42  Dogs and other animals.

    Dogs and other animals, except for seeing eye dogs or other guide 
dogs, shall not be brought into the buildings at NETC for other than 
official purposes.



Sec. 15.43  Vehicular and pedestrian traffic.

    (a) Drivers of all vehicles entering or while at NETC shall drive in 
a careful and safe manner at all times and shall comply with the parking 
and vehicle registration/requirements (except parking of four hours or 
less), signals and directions of security personnel and all posted 
traffic signs;
    (b) The blocking of entrances, driveways, walks, loading platforms, 
or fire hydrants on the property is prohibited; and
    (c) Parking without authority, parking in unauthorized locations or 
parking contrary to the direction of posted signs is prohibited. 
Vehicles parked in violation, where warning signs are posted, shall be 
subject to removal at the owner's risk and expense. The Administrator, 
U.S. Fire Administration or his/her designee may supplement this 
paragraph from time to time by issuing and posting such specific traffic 
directives as may be required. When issued and posted, such directives 
shall have the same force and effect as if

[[Page 183]]

made a part hereof. Proof that a motor vehicle was parked in violation 
of these regulations or other directives may be taken as evidence that 
the registered owner was responsible for the violation.



Sec. 15.44  Weapons and explosives.

    No person entering or while at NETC shall carry or possess firearms, 
other dangerous or deadly weapons, explosives, or items intended to be 
used to fabricate an explosive or incendiary device, either openly or 
concealed, except for official purposes (i.e., Federal, State or local 
law enforcement; when authorized by the Administrator, U.S. Fire 
Adminstration; or his designee or contract security forces when 
authorized by the contract project officer) and in accordance with FEMA 
policy governing the possession of firearms.



Sec. 15.45  Penalties.

    (a) Misconduct. Any misconduct will be processed and disposed of in 
accordance with FEMA/NETC policy or Instruction.
    (b) Parking violations. Vehicles parked in violation of State law, 
FEMA or NETC Instruction shall be subject to towing at the owner's 
expense.



Sec. 15.46  Other laws.

    Nothing contained in this subpart shall be construed to abrogate any 
other Federal laws or any State and local laws and regulations 
applicable to the National Emergency Training Center premises. This 
subpart supplements the penal provisions of title 18, United States 
Code, relating to Crimes and Criminal Procedure, which apply without 
regard to the place of the offense and those penal provisions which 
apply in areas under the special maritime and territorial jurisdiction 
of the United States, as defined in 18 U.S.C. 7. However, the content of 
this subpart supersedes those provisions of State law which are made 
Federal criminal offenses by virtue of the Assimilated Crime Act (18 
U.S.C. 13) to the extent that they are in conflict with this subpart. 
State and local criminal laws are applicable as such only to the extent 
that authority in that regard has been reserved to the State by the 
State consent or cession statute or vested in the State by Federal 
statute.



PART 16--ENFORCEMENT OF NONDISCRIMINATION ON THE BASIS OF HANDICAP IN PROGRAMS OR ACTIVITIES CONDUCTED BY THE FEDERAL EMERGENCY MANAGEMENT AGENCY--Table of Contents




Sec.
16.101  Purpose.
16.102  Application.
16.103  Definitions.
16.104-16.109  [Reserved]
16.110  Self-evaluation.
16.111  Notice.
16.112-16.129  [Reserved]
16.130  General prohibitions against discrimination.
16.131-16.139  [Reserved]
16.140  Employment.
16.141-16.148  [Reserved]
16.149  Program accessibility: Discrimination prohibited.
16.150  Program accessibility: Existing facilities.
16.151  Program accessibility: New construction and alterations.
16.152-16.159  [Reserved]
16.160  Communications.
16.161-16.169  [Reserved]
16.170  Compliance procedures.
16.171-16.999  [Reserved]

    Authority: 29 U.S.C. 794.

    Source: 53 FR 25885, July 8, 1988, unless otherwise noted.



Sec. 16.101  Purpose.

    The purpose of this regulation is to effectuate section 119 of the 
Rehabilitation, Comprehensive Services, and Developmental Disabilities 
Amendments of 1978, which amended section 504 of the Rehabilitation Act 
of 1973 to prohibit discrimination on the basis of handicap in programs 
or activities conducted by Executive agencies or the United States 
Postal Service.



Sec. 16.102  Application.

    This regulation (Secs. 16.101 through 16.170) applies to all 
programs or activities conducted by the agency, except for programs or 
activities conducted outside the United States that do not involve 
individuals with handicaps in the United States.

[[Page 184]]



Sec. 16.103  Definitions.

    For purposes of this regulation, the term--
    Assistant Attorney General means the Assistant Attorney General, 
Civil Rights Division, United States Department of Justice.
    Auxiliary aids means services or devices that enable persons with 
impaired sensory, manual, or speaking skills to have an equal 
opportunity to participate in, and enjoy the benefits of, programs or 
activities conducted by the agency. For example, auxiliary aids useful 
for persons with impaired vision include readers, Brailled materials, 
audio recordings, and other similar services and devices. Auxiliary aids 
useful for persons with impaired hearing include telephone handset 
amplifiers, telephones compatible with hearing aids, telecommunication 
devices for deaf persons (TDD's), interpreters, notetakers, written 
materials, and other similar services and devices.
    Complete complaint means a written statement that contains the 
complainant's name and address and describes the agency's alleged 
discriminatory action in sufficient detail to inform the agency of the 
nature and date of the alleged violation of section 504. It shall be 
signed by the complainant or by someone authorized to do so on his or 
her behalf. Complaints filed on behalf of classes or third parties shall 
describe or identify (by name, if possible) the alleged victims of 
discrimination.
    Facility means all or any portion of buildings, structures, 
equipment, roads, walks, parking lots, rolling stock or other 
conveyances, or other real or personal property.
    Historic preservation programs means programs conducted by the 
agency that have preservation of historic properties as a primary 
purpose.
    Historic properties means those properties that are listed or 
eligible for listing in the National Register of Historic Places or 
properties designated as historic under a statute of the appropriate 
State or local government body.
    Individual with handicaps means any person who has a physical or 
mental impairment that substantially limits one or more major life 
activities, has a record of such an impairment, or is regarded as having 
such an impairment.
    As used in this definition, the phrase:
    (1) Physical or mental impairment includes--
    (i) Any physiological disorder or condition, cosmetic disfigurement, 
or anatomical loss affecting one or more of the following body systems: 
Neurological; musculoskeletal; special sense organs; respiratory, 
including speech organs; cardiovascular; reproductive; digestive; 
genitourinary; hemic and lymphatic; skin; and endocrine; or
    (ii) Any mental or psychological disorder, such as mental 
retardation, organic brain syndrome, emotional or mental illness, and 
specific learning disabilities. The term physical or mental impairment 
includes, but is not limited to, such diseases and conditions as 
orthopedic, visual, speech, and hearing impairments, cerebral palsy, 
epilepsy, muscular dystrophy, multiple sclerosis, cancer, heart disease, 
diabetes, mental retardation, emotional illness, and drug addiction and 
alcoholism.
    (2) Major life activities includes functions such as caring for 
one's self, performing manual tasks, walking, seeing, hearing, speaking, 
breathing, learning, and working.
    (3) Has a record of such an impairment means has a history of, or 
has been misclassified as having, a mental or physical impairment that 
substantially limits one or more major life activities.
    (4) Is regarded as having an impairment means--
    (i) Has a physical or mental impairment that does not substantially 
limit major life activities but is treated by the agency as constituting 
such a limitation;
    (ii) Has a physical or mental impairment that substantially limits 
major life activities only as a result of the attitudes of others toward 
such impairment; or
    (iii) Has none of the impairments defined in paragraph (1) of this 
definition but is treated by the agency as having such an impairment.
    Qualified individual with handicaps means--
    (1) With respect to preschool, elementary, or secondary education 
services provided by the agency, an individual with handicaps who is a 
member of a class of persons otherwise entitled by

[[Page 185]]

statute, regulation, or agency policy to receive education services from 
the agency;
    (2) With respect to any other agency program or activity under which 
a person is required to perform services or to achieve a level of 
accomplishment, an individual with handicaps who meets the essential 
eligibility requirements and who can achieve the purpose of the program 
or activity without modifications in the program or activity that the 
agency can demonstrate would result in a fundamental alteration in its 
nature;
    (3) With respect to any other program or activity, an individual 
with handicaps who meets the essential eligibility requirements for 
participation in, or receipt of benefits from, that program or activity; 
and
    (4) Qualified handicapped person as that term is defined for 
purposes of employment in 29 CFR 1613.702(f), which is made applicable 
to this regulation by Sec. 16.140.
    Section 504 means section 504 of the Rehabilitation Act of 1973 
(Pub. L. 93-112, 87 Stat. 394 (29 U.S.C. 794)), as amended by the 
Rehabilitation Act Amendments of 1974 (Pub. L. 93-516, 88 Stat. 1617); 
the Rehabilitation, Comprehensive Services, and Developmental 
Disabilities Amendments of 1978 (Pub. L. 95-602, 92 Stat. 2955); and the 
Rehabilitation Act Amendments of 1986 (Pub. L. 99-506, 100 Stat. 1810). 
As used in this regulation, section 504 applies only to programs or 
activities conducted by Executive agencies and not to federally assisted 
programs.
    Substantial impairment means a significant loss of the integrity of 
finished materials, design quality, or special character resulting from 
a permanent alteration.



Secs. 16.104-16.109  [Reserved]



Sec. 16.110  Self-evaluation.

    (a) The agency shall, by September 6, 1989, evaluate its current 
policies and practices, and the effects thereof, that do not or may not 
meet the requirements of this regulation and, to the extent modification 
of any such policies and practices is required, the agency shall proceed 
to make the necessary modifications.
    (b) The agency shall provide an opportunity to interested persons, 
including individuals with handicaps or organizations representing 
individuals with handicaps, to participate in the self-evaluation 
process by submitting comments (both oral and written).
    (c) The agency shall, for at least three years following completion 
of the self-evaluation, maintain on file and make available for public 
inspection:
    (1) A description of areas examined and any problems identified; and
    (2) A description of any modifications made.



Sec. 16.111  Notice.

    The agency shall make available to employees, applicants, 
participants, beneficiaries, and other interested persons such 
information regarding the provisions of this regulation and its 
applicability to the programs or activities conducted by the agency, and 
make such information available to them in such manner as the head of 
the agency finds necessary to apprise such persons of the protections 
against discrimination assured them by section 504 and this regulation.



Secs. 16.112-16.129  [Reserved]



Sec. 16.130  General prohibitions against discrimination.

    (a) No qualified individual with handicaps shall, on the basis of 
handicap, be excluded from participation in, be denied the benefits of, 
or otherwise be subjected to discrimination under any program or 
activity conducted by the agency.
    (b)(1) The agency, in providing any aid, benefit, or service, may 
not, directly or through contractual, licensing, or other arrangements, 
on the basis of handicap--
    (i) Deny a qualified individual with handicaps the opportunity to 
participate in or benefit from the aid, benefit, or service;
    (ii) Afford a qualified individual with handicaps an opportunity to 
participate in or benefit from the aid, benefit, or service that is not 
equal to that afforded others;
    (iii) Provide a qualified individual with handicaps with an aid, 
benefit, or

[[Page 186]]

service that is not as effective in affording equal opportunity to 
obtain the same result, to gain the same benefit, or to reach the same 
level of achievement as that provided to others;
    (iv) Provide different or separate aid, benefits, or services to 
individuals with handicaps or to any class of individuals with handicaps 
than is provided to others unless such action is necessary to provide 
qualified individuals with handicaps with aid, benefits, or services 
that are as effective as those provided to others;
    (v) Deny a qualified individual with handicaps the opportunity to 
participate as a member of planning or advisory boards;
    (vi) Otherwise limit a qualified individual with handicaps in the 
enjoyment of any right, privilege, advantage, or opportunity enjoyed by 
others receiving the aid, benefit, or service.
    (2) The agency may not deny a qualified individual with handicaps 
the opportunity to participate in programs or activities that are not 
separate or different, despite the existence of permissibly separate or 
different programs or activities.
    (3) The agency may not, directly or through contractual or other 
arrangements, utilize criteria or methods of administration the purpose 
or effect of which would--
    (i) Subject qualified individuals with handicaps to discrimination 
on the basis of handicap; or
    (ii) Defeat or substantially impair accomplishment of the objectives 
of a program or activity with respect to individuals with handicaps.
    (4) The agency may not, in determining the site or location of a 
facility, make selections the purpose or effect of which would--
    (i) Exclude individuals with handicaps from, deny them the benefits 
of, or otherwise subject them to discrimination under any program or 
activity conducted by the agency; or
    (ii) Defeat or substantially impair the accomplishment of the 
objectives of a program or activity with respect to individuals with 
handicaps.
    (5) The agency, in the selection of procurement contractors, may not 
use criteria that subject qualified individuals with handicaps to 
discrimination on the basis of handicap.
    (6) The agency may not administer a licensing or certification 
program in a manner that subjects qualified individuals with handicaps 
to discrimination on the basis of handicap, nor may the agency establish 
requirements for the programs or activities of licensees or certified 
entities that subject qualified individuals with handicaps to 
discrimination on the basis of handicap. However, the programs or 
activities of entities that are licensed or certified by the agency are 
not, themselves, covered by this regulation.
    (c) The exclusion of nonhandicapped persons from the benefits of a 
program limited by Federal statute or Executive order to individuals 
with handicaps or the exclusion of a specific class of individuals with 
handicaps from a program limited by Federal statute or Executive order 
to a different class of individuals with handicaps is not prohibited by 
this regulation.
    (d) The agency shall administer programs and activities in the most 
integrated setting appropriate to the needs of qualified individuals 
with handicaps.



Secs. 16.131-16.139  [Reserved]



Sec. 16.140  Employment.

    No qualified individual with handicaps shall, on the basis of 
handicap, be subject to discrimination in employment under any program 
or activity conducted by the agency. The definitions, requirements, and 
procedures of section 501 of the Rehabilitation Act of 1973 (29 U.S.C. 
791), as established by the Equal Employment Opportunity Commission in 
29 CFR part 1613, shall apply to employment in federally conducted 
programs or activities.



Secs. 16.141-16.148  [Reserved]



Sec. 16.149  Program accessibility: Discrimination prohibited.

    Except as otherwise provided in Sec. 16.150, no qualified individual 
with handicaps shall, because the agency's facilities are inaccessible 
to or unusable by individuals with handicaps, be denied the benefits of, 
be excluded from

[[Page 187]]

participation in, or otherwise be subjected to discrimination under any 
program or activity conducted by the agency.



Sec. 16.150  Program accessibility: Existing facilities.

    (a) General. The agency shall operate each program or activity so 
that the program or activity, when viewed in its entirety, is readily 
accessible to and usable by individuals with handicaps. This paragraph 
does not--
    (1) Necessarily require the agency to make each of its existing 
facilities accessible to and usable by individuals with handicaps;
    (2) In the case of historic preservation programs, require the 
agency to take any action that would result in a substantial impairment 
of significant historic features of an historic property; or
    (3) Require the agency to take any action that it can demonstrate 
would result in a fundamental alteration in the nature of a program or 
activity or in undue financial and administrative burdens. In those 
circumstances where agency personnel believe that the proposed action 
would fundamentally alter the program or activity or would result in 
undue financial and administrative burdens, the agency has the burden of 
proving that compliance with Sec. 16.150(a) would result in such 
alteration or burdens. The decision that compliance would result in such 
alteration or burdens must be made by the agency head or his or her 
designee after considering all agency resources available for use in the 
funding and operation of the conducted program or activity, and must be 
accompanied by a written statement of the reasons for reaching that 
conclusion. If an action would result in such an alteration or such 
burdens, the agency shall take any other action that would not result in 
such an alteration or such burdens but would nevertheless ensure that 
individuals with handicaps receive the benefits and services of the 
program or activity.
    (b) Methods--(1) General. The agency may comply with the 
requirements of this section through such means as redesign of 
equipment, reassignment of services to accessible buildings, assignment 
of aides to beneficiaries, home visits, delivery of services at 
alternate accessible sites, alteration of existing facilities and 
construction of new facilities, use of accessible rolling stock, or any 
other methods that result in making its programs or activities readily 
accessible to and usable by individuals with handicaps. The agency is 
not required to make structural changes in existing facilities where 
other methods are effective in achieving compliance with this section. 
The agency, in making alterations to existing buildings, shall meet 
accessibility requirements to the extent compelled by the Architectural 
Barriers Act of 1968, as amended (42 U.S.C. 4151 through 4157), and any 
regulations implementing it. In choosing among available methods for 
meeting the requirements of this section, the agency shall give priority 
to those methods that offer programs and activities to qualified 
individuals with handicaps in the most integrated setting appropriate.
    (2) Historic preservation programs. In meeting the requirements of 
Sec. 16.150(a) in historic preservation programs, the agency shall give 
priority to methods that provide physical access to individuals with 
handicaps. In cases where a physical alteration to an historic property 
is not required because of Sec. 16.150(a) (2) or (3), alternative 
methods of achieving program accessibility include--
    (i) Using audio-visual materials and devices to depict those 
portions of an historic property that cannot otherwise be made 
accessible;
    (ii) Assigning persons to guide individuals with handicaps into or 
through portions of historic properties that cannot otherwise be made 
accessible; or
    (iii) Adopting other innovative methods.
    (c) Time period for compliance. The agency shall comply with the 
obligations established under this section by November 7, 1988, except 
that where structural changes in facilities are undertaken, such changes 
shall be made by September 6, 1991, but in any event as expeditiously as 
possible.
    (d) Transition plan. In the event that structural changes to 
facilities will be

[[Page 188]]

undertaken to achieve program accessibility, the agency shall develop, 
by March 6, 1989, a transition plan setting forth the steps necessary to 
complete such changes. The agency shall provide an opportunity to 
interested persons, including individuals with handicaps or 
organizations representing individuals with handicaps, to participate in 
the development of the transition plan by submitting comments (both oral 
and written). A copy of the transition plan shall be made available for 
public inspection. The plan shall, at a minimum--
    (1) Identify physical obstacles in the agency's facilities that 
limit the accessibility of its programs or activities to individuals 
with handicaps;
    (2) Describe in detail the methods that will be used to make the 
facilities accessible;
    (3) Specify the schedule for taking the steps necessary to achieve 
compliance with this section and, if the time period of the transition 
plan is longer than one year, identify steps that will be taken during 
each year of the transition period; and
    (4) Indicate the official responsible for implementation of the 
plan.



Sec. 16.151  Program accessibility: New construction and alterations.

    Each building or part of a building that is constructed or altered 
by, on behalf of, or for the use of the agency shall be designed, 
constructed, or altered so as to be readily accessible to and usable by 
individuals with handicaps. The definitions, requirements, and standards 
of the Architectural Barriers Act (42 U.S.C. 4151-4157), as established 
in 41 CFR 101-19.600 to 101-19.607, apply to buildings covered by this 
section.



Secs. 16.152-16.159  [Reserved]



Sec. 16.160  Communications.

    (a) The agency shall take appropriate steps to ensure effective 
communication with applicants, participants, personnel of other Federal 
entities, and members of the public.
    (1) The agency shall furnish appropriate auxiliary aids where 
necessary to afford an individual with handicaps an equal opportunity to 
participate in, and enjoy the benefits of, a program or activity 
conducted by the agency.
    (i) In determining what type of auxiliary aid is necessary, the 
agency shall give primary consideration to the requests of the 
individual with handicaps.
    (ii) The agency need not provide individually prescribed devices, 
readers for personal use or study, or other devices of a personal 
nature.
    (2) Where the agency communicates with applicants and beneficiaries 
by telephone, telecommunication devices for deaf persons (TDD's) or 
equally effective telecommunication systems shall be used to communicate 
with persons with impaired hearing.
    (b) The agency shall ensure that interested persons, including 
persons with impaired vision or hearing, can obtain information as to 
the existence and location of accessible services, activities, and 
facilities.
    (c) The agency shall provide signage at a primary entrance to each 
of its inaccessible facilities, directing users to a location at which 
they can obtain information about accessible facilities. The 
international symbol for accessibility shall be used at each primary 
entrance of an accessible facility.
    (d) This section does not require the agency to take any action that 
it can demonstrate would result in a fundamental alteration in the 
nature of a program or activity or in undue financial and administrative 
burdens. In those circumstances where agency personnel believe that the 
proposed action would fundamentally alter the program or activity or 
would result in undue financial and administrative burdens, the agency 
has the burden of proving that compliance with Sec. 16.160 would result 
in such alteration or burdens. The decision that compliance would result 
in such alteration or burdens must be made by the agency head or his or 
her designee after considering all agency resources available for use in 
the funding and operation of the conducted program or activity and must 
be accompanied by a written statement of the reasons for reaching that 
conclusion. If an action required to comply with this section would 
result in such an alteration or such burdens, the agency shall take any 
other action that would not

[[Page 189]]

result in such an alteration or such burdens but would nevertheless 
ensure that, to the maximum extent possible, individuals with handicaps 
receive the benefits and services of the program or activity.



Secs. 16.161-16.169  [Reserved]



Sec. 16.170  Compliance procedures.

    (a) Except as provided in paragraph (b) of this section, this 
section applies to all allegations of discrimination on the basis of 
handicap in programs and activities conducted by the agency.
    (b) The agency shall process complaints alleging violations of 
section 504 with respect to employment according to the procedures 
established by the Equal Employment Opportunity Commission in 29 CFR 
part 1613 pursuant to section 501 of the Rehabilitation Act of 1973 (29 
U.S.C. 791).
    (c) The Director of Personnel shall be responsible for coordinating 
implementation of this section. Complaints may be sent to Director of 
Personnel, Room 810, Federal Emergency Management Agency, 500 C Street, 
SW., Washington, DC 20472.
    (d) The agency shall accept and investigate all complete complaints 
for which it has jurisdiction. All complete complaints must be filed 
within 180 days of the alleged act of discrimination. The agency may 
extend this time period for good cause.
    (e) If the agency receives a complaint over which it does not have 
jurisdiction, it shall promptly notify the complainant and shall make 
reasonable efforts to refer the complaint to the appropriate Government 
entity.
    (f) The agency shall notify the Architectural and Transportation 
Barriers Compliance Board upon receipt of any complaint alleging that a 
building or facility that is subject to the Architectural Barriers Act 
of 1968, as amended (42 U.S.C. 4151-4157), is not readily accessible to 
and usable by individuals with handicaps.
    (g) Within 180 days of the receipt of a complete complaint for which 
it has jurisdiction, the agency shall notify the complainant of the 
results of the investigation in a letter containing--
    (1) Findings of fact and conclusions of law;
    (2) A description of a remedy for each violation found; and
    (3) A notice of the right to appeal.
    (h) Appeals of the findings of fact and conclusions of law or 
remedies must be filed by the complainant within 90 days of receipt from 
the agency of the letter required by paragraph (g) of this section. The 
agency may extend this time for good cause.
    (i) Timely appeals shall be accepted and processed by the head of 
the agency.
    (j) The head of the agency shall notify the complainant of the 
results of the appeal within 60 days of the receipt of the request. If 
the head of the agency determines that additional information is needed 
from the complainant, he or she shall have 60 days from the date of 
receipt of the additional information to make his or her determination 
on the appeal.
    (k) The time limits cited in paragraphs (g) and (j) of this section 
may be extended with the permission of the Assistant Attorney General.
    (l) The agency may delegate its authority for conducting complaint 
investigations to other Federal agencies, except that the authority for 
making the final determination may not be delegated to another agency.



Secs. 16.171-16.999  [Reserved]



PART 17--GOVERNMENTWIDE DEBARMENT AND SUSPENSION (NONPROCUREMENT) AND GOVERNMENTWIDE REQUIREMENTS FOR DRUG-FREE WORKPLACE (GRANTS)--Table of Contents




                           Subpart A--General

Sec.
17.100  Purpose.
17.105  Definitions.
17.110  Coverage.
17.115  Policy.

                       Subpart B--Effect of Action

17.200  Debarment or suspension.
17.205  Ineligible persons.
17.210  Voluntary exclusion.
17.215  Exception provision.
17.220  Continuation of covered transactions.
17.225  Failure to adhere to restrictions.

[[Page 190]]

                          Subpart C--Debarment

17.300  General.
17.305  Causes for debarment.
17.310  Procedures.
17.311  Investigation and referral.
17.312  Notice of proposed debarment.
17.313  Opportunity to contest proposed debarment.
17.314  Debarring official's decision.
17.315  Settlement and voluntary exclusion.
17.320  Period of debarment.
17.325  Scope of debarment.

                          Subpart D--Suspension

17.400  General.
17.405  Causes for suspension.
17.410  Procedures.
17.411  Notice of suspension.
17.412  Opportunity to contest suspension.
17.413  Suspending official's decision.
17.415  Period of suspension.
17.420  Scope of suspension.

       Subpart E--Responsibilities of GSA, Agency and Participants

17.500  GSA responsibilities.
17.505  FEMA responsibilities.
17.510  Participants' responsibilities.

          Subpart F--Drug-Free Workplace Requirements (Grants)

17.600  Purpose.
17.605  Definitions.
17.610  Coverage.
17.615  Grounds for suspension of payments, suspension or termination of 
          grants, or suspension or debarment.
17.620  Effect of violation.
17.625  Exception provision.
17.630  Certification requirements and procedures.
17.635  Reporting of and employee sanctions for convictions of criminal 
          drug offenses.

Appendix A to Part 17--Certification Regarding Debarment, Suspension, 
          and Other Responsibility Matters--Primary Covered Transactions
Appendix B to Part 17--Certification Regarding Debarment, Suspension, 
          Ineligibility and Voluntary Exclusion--Lower Tier Covered 
          Transactions
Appendix C to Part 17--Certification Regarding Drug-Free Workplace 
          Requirements

    Authority: 41 U.S.C. 701 et seq.; E.O. 12549, 51 FR 6370, 3 CFR, 
1986 Comp., p. 189; E.O. 12689, 54 FR 34131, 3 CFR, 1989 Comp., p. 235.

    Source: 53 FR 19199, and 19204, May 26, 1988, unless otherwise 
noted.

    Editorial Note: For additional information, see related documents 
published at 50 FR 8953, Mar. 5, 1985; 52 FR 18768, May 19, 1987; and 52 
FR 45667, Dec. 1, 1987.



                           Subpart A--General



Sec. 17.100  Purpose.

    (a) Executive Order (E.O.) 12549 provides that, to the extent 
permitted by law, Executive departments and agencies shall participate 
in a governmentwide system for nonprocurement debarment and suspension. 
A person who is debarred or suspended shall be excluded from Federal 
financial and nonfinancial assistance and benefits under Federal 
programs and activities. Debarment or suspension of a participant in a 
program by one agency shall have governmentwide effect.
    (b) These regulations implement section 3 of E.O. 12549 and the 
guidelines promulgated by the Office of Management and Budget under 
section 6 of the E.O. by:
    (1) Prescribing the programs and activities that are covered by the 
governmentwide system;
    (2) Prescribing the governmentwide criteria and governmentwide 
minimum due process procedures that each agency shall use;
    (3) Providing for the listing of debarred and suspended 
participants, participants declared ineligible (see definition of 
``ineligible'' in Sec. 17.105), and participants who have voluntarily 
excluded themselves from participation in covered transactions;
    (4) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion; and
    (5) Offering such other guidance as necessary for the effective 
implementation and administration of the governmentwide system.
    (c) These regulations also implement Executive Order 12689 (3 CFR, 
1989 Comp., p. 235) and 31 U.S.C. 6101 note (Public Law 103-355, sec. 
2455, 108 Stat. 3327) by--
    (1) Providing for the inclusion in the List of Parties Excluded from 
Federal Procurement and Nonprocurement Programs all persons proposed for 
debarment, debarred or suspended under the Federal Acquisition 
Regulation, 48 CFR Part 9, subpart 9.4; persons against which 
governmentwide exclusions have

[[Page 191]]

been entered under this part; and persons determined to be ineligible; 
and
    (2) Setting forth the consequences of a debarment, suspension, 
determination of ineligibility, or voluntary exclusion.
    (d) Although these regulations cover the listing of ineligible 
participants and the effect of such listing, they do not prescribe 
policies and procedures governing declarations of ineligibility.

[60 FR 33040, 33061, June 26, 1995]



Sec. 17.105  Definitions.

    The following definitions apply to this part:
    Adequate evidence. Information sufficient to support the reasonable 
belief that a particular act or omission has occurred.
    Affiliate. Persons are affiliates of each other if, directly or 
indirectly, either one controls or has the power to control the other, 
or, a third person controls or has the power to control both. Indicia of 
control include, but are not limited to: interlocking management or 
ownership, identity of interests among family members, shared facilities 
and equipment, common use of employees, or a business entity organized 
following the suspension or debarment of a person which has the same or 
similar management, ownership, or principal employees as the suspended, 
debarred, ineligible, or voluntarily excluded person.
    Agency. Any executive department, military department or defense 
agency or other agency of the executive branch, excluding the 
independent regulatory agencies.
    Civil judgment. The disposition of a civil action by any court of 
competent jurisdiction, whether entered by verdict, decision, 
settlement, stipulation, or otherwise creating a civil liability for the 
wrongful acts complained of; or a final determination of liability under 
the Program Fraud Civil Remedies Act of 1988 (31 U.S.C. 3801-12).
    Conviction. A judgment or conviction of a criminal offense by any 
court of competent jurisdiction, whether entered upon a verdict or a 
plea, including a plea of nolo contendere.
    Debarment. An action taken by a debarring official in accordance 
with these regulations to exclude a person from participating in covered 
transactions. A person so excluded is ``debarred.''
    Debarring official. An official authorized to impose debarment. The 
debarring official is either:
    The agency head, or
    An official designated by the agency head.
    Indictment. Indictment for a criminal offense. An information or 
other filing by competent authority charging a criminal offense shall be 
given the same effect as an indictment.
    Ineligible. Excluded from participation in Federal nonprocurement 
programs pursuant to a determination of ineligibility under statutory, 
executive order, or regulatory authority, other than Executive Order 
12549 and its agency implementing regulations; for exemple, excluded 
pursuant to the Davis-Bacon Act and its implementing regulations, the 
equal employment opportunity acts and executive orders, or the 
environmental protection acts and executive orders. A person is 
ineligible where the determination of ineligibility affects such 
person's eligibility to participate in more than one covered 
transaction.
    Legal proceedings. Any criminal proceeding or any civil judicial 
proceeding to which the Federal Government or a State or local 
government or quasi-governmental authority is a party. The term includes 
appeals from such proceedings.
    List of Parties Excluded from Federal Procurement and Nonprocurement 
Programs. A list compiled, maintained and distributed by the General 
Services Administration (GSA) containing the names and other information 
about persons who have been debarred, suspended, or voluntarily excluded 
under Executive Orders 12549 and 12689 and these regulations or 48 CFR 
part 9, subpart 9.4, persons who have been proposed for debarment under 
48 CFR part 9, subpart 9.4, and those persons who have been determined 
to be ineligible.
    Notice. A written communication served in person or sent by 
certified mail, return receipt requested, or its equivalent, to the last 
known address of a party, its identified counsel, its agent for service 
of process, or any partner, officer, director, owner, or

[[Page 192]]

joint venturer of the party. Notice, if undeliverable, shall be 
considered to have been received by the addressee five days after being 
properly sent to the last address known by the agency.
    Participant. Any person who submits a proposal for, enters into, or 
reasonably may be expected to enter into a covered transaction. This 
term also includes any person who acts on behalf of or is authorized to 
commit a participant in a covered transaction as an agent or 
representative of another participant.
    Person. Any individual, corporation, partnership, association, unit 
of government or legal entity, however organized, except: foreign 
governments or foreign governmental entities, public international 
organizations, foreign government owned (in whole or in part) or 
controlled entities, and entities consisting wholly or partially of 
foreign governments or foreign governmental entities.
    Preponderance of the evidence. Proof by information that, compared 
with that opposing it, leads to the conclusion that the fact at issue is 
more probably true than not.
    Principal. Officer, director, owner, partner, key employee, or other 
person within a participant with primary management or supervisory 
responsibilities; or a person who has a critical influence on or 
substantive control over a covered transaction, whether or not employed 
by the participant. Persons who have a critical influence on or 
substantive control over a covered transaction are:
    Principal investigators. [Reserved]
    Proposal. A solicited or unsolicited bid, application, request, 
invitation to consider or similar communication by or on behalf of a 
person seeking to participate or to receive a benefit, directly or 
indirectly, in or under a covered transaction.
    Respondent. A person against whom a debarment or suspension action 
has been initiated.
    State. Any of the States of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, any territory or possession 
of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers that instrumentality to be an agency of the 
State government.
    Suspending official. An official authorized to impose suspension. 
The suspending official is either:
    The agency head, or
    An official designated by the agency head.
    Suspension. An action taken by a suspending official in accordance 
with these regulations that immediately excludes a person from 
participating in covered transactions for a temporary period, pending 
completion of an investigation and such legal, debarment, or Program 
Fraud Civil Remedies Act proceedings as may ensue. A person so excluded 
is ``suspended.''
    Voluntary exclusion or voluntarily excluded. A status of 
nonparticipation or limited participation in covered transactions 
assumed by a person pursuant to the terms of a settlement.
    FEMA. Federal Emergency Management Agency.

[53 FR 19199, 19200, and 19204, May 26, 1988, as amended at 60 FR 33041, 
33061, June 26, 1995]



Sec. 17.110  Coverage.

    (a) These regulations apply to all persons who have participated, 
are currently participating or may reasonably be expected to participate 
in transactions under Federal nonprocurement programs. For purposes of 
these regulations such transactions will be referred to as ``covered 
transactions.''
    (1) Covered transaction. For purposes of these regulations, a 
covered transaction is a primary covered transaction or a lower tier 
covered transaction. Covered transactions at any tier need not involve 
the transfer of Federal funds.
    (i) Primary covered transaction. Except as noted in paragraph (a)(2) 
of this section, a primary covered transaction is any nonprocurement 
transaction between an agency and a person, regardless of type, 
including: grants, cooperative agreements, scholarships, fellowships, 
contracts of assistance, loans, loan guarantees, subsidies, insurance, 
payments for specified use, donation

[[Page 193]]

agreements and any other nonprocurement transactions between a Federal 
agency and a person. Primary covered transactions also include those 
transactions specially designated by the U.S. Department of Housing and 
Urban Development in such agency's regulations governing debarment and 
suspension.
    (ii) Lower tier covered transaction. A lower tier covered 
transaction is:
    (A) Any transaction between a participant and a person other than a 
procurement contract for goods or services, regardless of type, under a 
primary covered transaction.
    (B) Any procurement contract for goods or services between a 
participant and a person, regardless of type, expected to equal or 
exceed the Federal procurement small purchase threshold fixed at 10 
U.S.C. 2304(g) and 41 U.S.C. 253(g) (currently $25,000) under a primary 
covered transaction.
    (C) Any procurement contract for goods or services between a 
participant and a person under a covered transaction, regardless of 
amount, under which that person will have a critical influence on or 
substantive control over that covered transaction. Such persons are:
    (1) Principal investigators.
    (2) Providers of federally-required audit services.
    (2) Exceptions. The following transactions are not covered:
    (i) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (ii) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, entities 
consisting wholly or partially of foreign governments or foreign 
governmental entities;
    (iii) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (iv) Federal employment;
    (v) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (vi) Incidental benefits derived from ordinary governmental 
operations; and
    (vii) Other transactions where the application of these regulations 
would be prohibited by law.
    (b) Relationship to other sections. This section describes the types 
of transactions to which a debarment or suspension under the regulations 
will apply. Subpart B, ``Effect of Action,'' Sec. 17.200, ``Debarment or 
suspension,'' sets forth the consequences of a debarment or suspension. 
Those consequences would obtain only with respect to participants and 
principals in the covered transactions and activities described in 
Sec. 17.110(a). Sections 17.325, ``Scope of debarment,'' and 17.420, 
``Scope of suspension,'' govern the extent to which a specific 
participant or organizational elements of a participant would be 
automatically included within a debarment or suspension action, and the 
conditions under which affiliates or persons associated with a 
participant may also be brought within the scope of the action.
    (c) Relationship to Federal procurement activities. In accordance 
with E.O. 12689 and section 2455 of Public Law 103-355, any debarment, 
suspension, proposed debarment or other governmentwide exclusion 
initiated under the Federal Acquisition Regulation (FAR) on or after 
August 25, 1995 shall be recognized by and effective for Executive 
Branch agencies and participants as an exclusion under this regulation. 
Similarly, any debarment, suspension or other governmentwide exclusion 
initiated under this regulation on or after August 25, 1995 shall be 
recognized by and effective for those agencies as a debarment or 
suspension under the FAR.

[53 FR 19199, and 19204, May 26, 1988, as amended at 60 FR 33041, 33061, 
June 26, 1995]



Sec. 17.115  Policy.

    (a) In order to protect the public interest, it is the policy of the 
Federal Government to conduct business only with responsible persons. 
Debarment and suspension are discretionary actions that, taken in 
accordance with

[[Page 194]]

Executive Order 12549 and these regulations, are appropriate means to 
implement this policy.
    (b) Debarment and suspension are serious actions which shall be used 
only in the public interest and for the Federal Government's protection 
and not for purposes of punishment. Agencies may impose debarment or 
suspension for the causes and in accordance with the procedures set 
forth in these regulations.
    (c) When more than one agency has an interest in the proposed 
debarment or suspension of a person, consideration shall be given to 
designating one agency as the lead agency for making the decision. 
Agencies are encouraged to establish methods and procedures for 
coordinating their debarment or suspension actions.



                       Subpart B--Effect of Action



Sec. 17.200  Debarment or suspension.

    (a) Primary covered transactions. Except to the extent prohibited by 
law, persons who are debarred or suspended shall be excluded from 
primary covered transactions as either participants or principals 
throughout the Executive Branch of the Federal Government for the period 
of their debarment, suspension, or the period they are proposed for 
debarment under 48 CFR part 9, subpart 9.4. Accordingly, no agency shall 
enter into primary covered transactions with such excluded persons 
during such period, except as permitted pursuant to Sec. 17.215.
    (b) Lower tier covered transactions. Except to the extent prohibited 
by law, persons who have been proposed for debarment under 48 CFR part 
9, subpart 9.4, debarred or suspended shall be excluded from 
participating as either participants or principals in all lower tier 
covered transactions (see Sec. 17.110(a)(1)(ii)) for the period of their 
exclusion.
    (c) Exceptions. Debarment or suspension does not affect a person's 
eligibility for--
    (1) Statutory entitlements or mandatory awards (but not subtier 
awards thereunder which are not themselves mandatory), including 
deposited funds insured by the Federal Government;
    (2) Direct awards to foreign governments or public international 
organizations, or transactions with foreign governments or foreign 
governmental entities, public international organizations, foreign 
government owned (in whole or in part) or controlled entities, and 
entities consisting wholly or partially of foreign governments or 
foreign governmental entities;
    (3) Benefits to an individual as a personal entitlement without 
regard to the individual's present responsibility (but benefits received 
in an individual's business capacity are not excepted);
    (4) Federal employment;
    (5) Transactions pursuant to national or agency-recognized 
emergencies or disasters;
    (6) Incidental benefits derived from ordinary governmental 
operations; and
    (7) Other transactions where the application of these regulations 
would be prohibited by law.

[60 FR 33041, 33061, June 26, 1995]



Sec. 17.205  Ineligible persons.

    Persons who are ineligible, as defined in Sec. 17.105(i), are 
excluded in accordance with the applicable statutory, executive order, 
or regulatory authority.



Sec. 17.210  Voluntary exclusion.

    Persons who accept voluntary exclusions under Sec. 17.315 are 
excluded in accordance with the terms of their settlements. FEMA shall, 
and participants may, contact the original action agency to ascertain 
the extent of the exclusion.



Sec. 17.215  Exception provision.

    FEMA may grant an exception permitting a debarred, suspended, or 
voluntarily excluded person, or a person proposed for debarment under 48 
CFR part 9, subpart 9.4, to participate in a particular covered 
transaction upon a written determination by the agency head or an 
authorized designee stating the reason(s) for deviating from the 
Presidential policy established by Executive Order 12549 and 
Sec. 17.200. However, in accordance with the President's stated 
intention in the Executive Order, exceptions shall be granted

[[Page 195]]

only infrequently. Exceptions shall be reported in accordance with 
Sec. 17.505(a).

[60 FR 33041, 33061, June 26, 1995]



Sec. 17.220  Continuation of covered transactions.

    (a) Notwithstanding the debarment, suspension, proposed debarment 
under 48 CFR part 9, subpart 9.4, determination of ineligibility, or 
voluntary exclusion of any person by an agency, agencies and 
participants may continue covered transactions in existence at the time 
the person was debarred, suspended, proposed for debarment under 48 CFR 
part 9, subpart 9.4, declared ineligible, or voluntarily excluded. A 
decision as to the type of termination action, if any, to be taken 
should be made only after thorough review to ensure the propriety of the 
proposed action.
    (b) Agencies and participants shall not renew or extend covered 
transactions (other than no-cost time extensions) with any person who is 
debarred, suspended, proposed for debarment under 48 CFR part 9, subpart 
9.4, ineligible or voluntary excluded, except as provided in 
Sec. 17.215.

[60 FR 33041, 33061, June 26, 1995]



Sec. 17.225  Failure to adhere to restrictions.

    (a) Except as permitted under Sec. 17.215 or Sec. 17.220, a 
participant shall not knowingly do business under a covered transaction 
with a person who is--
    (1) Debarred or suspended;
    (2) Proposed for debarment under 48 CFR part 9, subpart 9.4; or
    (3) Ineligible for or voluntarily excluded from the covered 
transaction.
    (b) Violation of the restriction under paragraph (a) of this section 
may result in disallowance of costs, annulment or termination of award, 
issuance of a stop work order, debarment or suspension, or other 
remedies as appropriate.
    (c) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, proposed for debarment under 48 
CFR part 9, subpart 9.4, ineligible, or voluntarily excluded from the 
covered transaction (See Appendix B of these regulations), unless it 
knows that the certification is erroneous. An agency has the burden of 
proof that a participant did knowingly do business with a person that 
filed an erroneous certification.

[60 FR 33041, 33061, June 26, 1995]



                          Subpart C--Debarment



Sec. 17.300  General.

    The debarring official may debar a person for any of the causes in 
Sec. 17.305, using procedures established in Secs. 17.310 through 
17.314. The existence of a cause for debarment, however, does not 
necessarily require that the person be debarred; the seriousness of the 
person's acts or omissions and any mitigating factors shall be 
considered in making any debarment decision.



Sec. 17.305  Causes for debarment.

    Debarment may be imposed in accordance with the provisions of 
Secs. 17.300 through 17.314 for:
    (a) Conviction of or civil judgment for:
    (1) Commission of fraud or a criminal offense in connection with 
obtaining, attempting to obtain, or performing a public or private 
agreement or transaction;
    (2) Violation of Federal or State antitrust statutes, including 
those proscribing price fixing between competitors, allocation of 
customers between competitors, and bid rigging;
    (3) Commission of embezzlement, theft, forgery, bribery, 
falsification or destruction of records, making false statements, 
receiving stolen property, making false claims, or obstruction of 
justice; or
    (4) Commission of any other offense indicating a lack of business 
integrity or business honesty that seriously and directly affects the 
present responsibility of a person.
    (b) Violation of the terms of a public agreement or transaction so 
serious as to affect the integrity of an agency program, such as:
    (1) A willful failure to perform in accordance with the terms of one 
or more public agreements or transactions;
    (2) A history of failure to perform or of unsatisfactory performance 
of one or

[[Page 196]]

more public agreements or transactions; or
    (3) A willful violation of a statutory or regulatory provision or 
requirement applicable to a public agreement or transaction.
    (c) Any of the following causes:
    (1) A nonprocurement debarment by any Federal agency taken before 
October 1, 1988, the effective date of these regulations, or a 
procurement debarment by any Federal agency taken pursuant to 48 CFR 
subpart 9.4;
    (2) Knowingly doing business with a debarred, suspended, ineligible, 
or voluntarily excluded person, in connection with a covered 
transaction, except as permitted in Sec. 17.215 or Sec. 17.220;
    (3) Failure to pay a single substantial debt, or a number of 
outstanding debts (including disallowed costs and overpayments, but not 
including sums owed the Federal Government under the Internal Revenue 
Code) owed to any Federal agency or instrumentality, provided the debt 
is uncontested by the debtor or, if contested, provided that the 
debtor's legal and administrative remedies have been exhausted; or
    (4) Violation of a material provision of a voluntary exclusion 
agreement entered into under Sec. 17.315 or of any settlement of a 
debarment or suspension action.
    (5) Violation of any requirement of subpart F of this part, relating 
to providing a drug-free workplace, as set forth in Sec. 17.615 of this 
part.
    (d) Any other cause of so serious or compelling a nature that it 
affects the present responsibility of a person.

[53 FR 19199, and 19204, May 26, 1988, as amended at 54 FR 4963, Jan. 
31, 1989]



Sec. 17.310  Procedures.

    FEMA shall process debarment actions as informally as practicable, 
consistent with the principles of fundamental fairness, using the 
procedures in Secs. 17.311 through 17.314.



Sec. 17.311  Investigation and referral.

    Information concerning the existence of a cause for debarment from 
any source shall be promptly reported, investigated, and referred, when 
appropriate, to the debarring official for consideration. After 
consideration, the debarring official may issue a notice of proposed 
debarment.



Sec. 17.312  Notice of proposed debarment.

    A debarment proceeding shall be initiated by notice to the 
respondent advising:
    (a) That debarment is being considered;
    (b) Of the reasons for the proposed debarment in terms sufficient to 
put the respondent on notice of the conduct or transaction(s) upon which 
it is based;
    (c) Of the cause(s) relied upon under Sec. 17.305 for proposing 
debarment;
    (d) Of the provisions of Secs. 17.311 through 17.314, and any other 
FEMA procedures, if applicable, governing debarment decisionmaking; and
    (e) Of the potential effect of a debarment.



Sec. 17.313  Opportunity to contest proposed debarment.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of proposed debarment, the respondent may submit, in person, in 
writing, or through a representative, information and argument in 
opposition to the proposed debarment.
    (b) Additional proceedings as to disputed material facts. (1) In 
actions not based upon a conviction or civil judgment, if the debarring 
official finds that the respondent's submission in opposition raises a 
genuine dispute over facts material to the proposed debarment, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents.
    (2) A transcribed record of any additional proceedings shall be made 
available at cost to the respondent, upon request, unless the respondent 
and the agency, by mutual agreement, waive the requirement for a 
transcript.



Sec. 17.314  Debarring official's decision.

    (a) No additional proceedings necessary. In actions based upon a 
conviction or civil judgment, or in which there is no genuine dispute 
over material facts,

[[Page 197]]

the debarring official shall make a decision on the basis of all the 
information in the administrative record, including any submission made 
by the respondent. The decision shall be made within 45 days after 
receipt of any information and argument submitted by the respondent, 
unless the debarring official extends this period for good cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The debarring 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The debarring official may refer disputed material facts to 
another official for findings of fact. The debarring official may reject 
any such findings, in whole or in part, only after specifically 
determining them to be arbitrary and capricious or clearly erroneous.
    (3) The debarring official's decision shall be made after the 
conclusion of the proceedings with respect to disputed facts.
    (c)(1) Standard of proof. In any debarment action, the cause for 
debarment must be established by a preponderance of the evidence. Where 
the proposed debarment is based upon a conviction or civil judgment, the 
standard shall be deemed to have been met.
    (2) Burden of proof. The burden of proof is on the agency proposing 
debarment.
    (d) Notice of debarring official's decision. (1) If the debarring 
official decides to impose debarment, the respondent shall be given 
prompt notice:
    (i) Referring to the notice of proposed debarment;
    (ii) Specifying the reasons for debarment;
    (iii) Stating the period of debarment, including effective dates; 
and
    (iv) Advising that the debarment is effective for covered 
transactions throughout the executive branch of the Federal Government 
unless an agency head or an authorized designee makes the determination 
referred to in Sec. 17.215.
    (2) If the debarring official decides not to impose debarment, the 
respondent shall be given prompt notice of that decision. A decision not 
to impose debarment shall be without prejudice to a subsequent 
imposition of debarment by any other agency.



Sec. 17.315  Settlement and voluntary exclusion.

    (a) When in the best interest of the Government, FEMA may, at any 
time, settle a debarment or suspension action.
    (b) If a participant and the agency agree to a voluntary exclusion 
of the participant, such voluntary exclusion shall be entered on the 
Nonprocurement List (see subpart E).



Sec. 17.320  Period of debarment.

    (a) Debarment shall be for a period commensurate with the 
seriousness of the cause(s). If a suspension precedes a debarment, the 
suspension period shall be considered in determining the debarment 
period.
    (1) Debarment for causes other than those related to a violation of 
the requirements of subpart F of this part generally should not exceed 
three years. Where circumstances warrant, a longer period of debarment 
may be imposed.
    (2) In the case of a debarment for a violation of the requirements 
of subpart F of this part (see 17.305(c)(5)), the period of debarment 
shall not exceed five years.

[54 FR 4963, Jan. 31, 1989]



Sec. 17.325  Scope of debarment.

    (a) Scope in general. (1) Debarment of a person under these 
regulations constitutes debarment of all its divisions and other 
organizational elements from all covered transactions, unless the 
debarment decision is limited by its terms to one or more specifically 
identified individuals, divisions or other organizational elements or to 
specific types of transactions.
    (2) The debarment action may include any affiliate of the 
participant that is specifically named and given notice of the proposed 
debarment and an opportunity to respond (see Secs. 17.311 through 
17.314).

[[Page 198]]

    (b) Imputing conduct. For purposes of determining the scope of 
debarment, conduct may be imputed as follows:
    (1) Conduct imputed to participant. The fraudulent, criminal or 
other seriously improper conduct of any officer, director, shareholder, 
partner, employee, or other individual associated with a participant may 
be imputed to the participant when the conduct occurred in connection 
with the individual's performance of duties for or on behalf of the 
participant, or with the participant's knowledge, approval, or 
acquiescence. The participant's acceptance of the benefits derived from 
the conduct shall be evidence of such knowledge, approval, or 
acquiescence.
    (2) Conduct imputed to individuals associated with participant. The 
fraudulent, criminal, or other seriously improper conduct of a 
participant may be imputed to any officer, director, shareholder, 
partner, employee, or other individual associated with the participant 
who participated in, knew of, or had reason to know of the participant's 
conduct.
    (3) Conduct of one participant imputed to other participants in a 
joint venture. The fraudulent, criminal, or other seriously improper 
conduct of one participant in a joint venture, grant pursuant to a joint 
application, or similar arrangement may be imputed to other participants 
if the conduct occurred for or on behalf of the joint venture, grant 
pursuant to a joint application, or similar arrangement may be imputed 
to other participants if the conduct occurred for or on behalf of the 
joint venture, grant pursuant to a joint application, or similar 
arrangement or with the knowledge, approval, or acquiescence of these 
participants. Acceptance of the benefits derived from the conduct shall 
be evidence of such knowledge, approval, or acquiescence.



                          Subpart D--Suspension



Sec. 17.400  General.

    (a) The suspending official may suspend a person for any of the 
causes in Sec. 17.405 using procedures established in Secs. 17.410 
through 17.413.
    (b) Suspension is a serious action to be imposed only when:
    (1) There exists adequate evidence of one or more of the causes set 
out in Sec. 17.405, and
    (2) Immediate action is necessary to protect the public interest.
    (c) In assessing the adequacy of the evidence, the agency should 
consider how much information is available, how credible it is given the 
circumstances, whether or not important allegations are corroborated, 
and what inferences can reasonably be drawn as a result. This assessment 
should include an examination of basic documents such as grants, 
cooperative agreements, loan authorizations, and contracts.



Sec. 17.405  Causes for suspension.

    (a) Suspension may be imposed in accordance with the provisions of 
Secs. 17.400 through 17.413 upon adequate evidence:
    (1) To suspect the commission of an offense listed in 
Sec. 17.305(a); or
    (2) That a cause for debarment under Sec. 17.305 may exist.
    (b) Indictment shall constitute adequate evidence for purposes of 
suspension actions.



Sec. 17.410  Procedures.

    (a) Investigation and referral. Information concerning the existence 
of a cause for suspension from any source shall be promptly reported, 
investigated, and referred, when appropriate, to the suspending official 
for consideration. After consideration, the suspending official may 
issue a notice of suspension.
    (b) Decisionmaking process. FEMA shall process suspension actions as 
informally as practicable, consistent with principles of fundamental 
fairness, using the procedures in Sec. 17.411 through Sec. 17.413.



Sec. 17.411  Notice of suspension.

    When a respondent is suspended, notice shall immediately be given:
    (a) That suspension has been imposed;
    (b) That the suspension is based on an indictment, conviction, or 
other adequate evidence that the respondent has committed irregularities 
seriously reflecting on the propriety of further Federal Government 
dealings with the respondent;

[[Page 199]]

    (c) Describing any such irregularities in terms sufficient to put 
the respondent on notice without disclosing the Federal Government's 
evidence;
    (d) Of the cause(s) relied upon under Sec. 17.405 for imposing 
suspension;
    (e) That the suspension is for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings;
    (f) Of the provisions of Sec. 17.411 through Sec. 17.413 and any 
other FEMA procedures, if applicable, governing suspension 
decisionmaking; and
    (g) Of the effect of the suspension.



Sec. 17.412  Opportunity to contest suspension.

    (a) Submission in opposition. Within 30 days after receipt of the 
notice of suspension, the respondent may submit, in person, in writing, 
or through a representative, information and argument in opposition to 
the suspension.
    (b) Additional proceedings as to disputed material facts. (1) If the 
suspending official finds that the respondent's submission in opposition 
raises a genuine dispute over facts material to the suspension, 
respondent(s) shall be afforded an opportunity to appear with a 
representative, submit documentary evidence, present witnesses, and 
confront any witness the agency presents, unless:
    (i) The action is based on an indictment, conviction or civil 
judgment, or
    (ii) A determination is made, on the basis of Department of Justice 
advice, that the substantial interests of the Federal Government in 
pending or contemplated legal proceedings based on the same facts as the 
suspension would be prejudiced.
    (2) A transcribed record of any additional proceedings shall be 
prepared and made available at cost to the respondent, upon request, 
unless the respondent and the agency, by mutual agreement, waive the 
requirement for a transcript.



Sec. 17.413  Suspending official's decision.

    The suspending official may modify or terminate the suspension (for 
example, see Sec. 17.320(c) for reasons for reducing the period or scope 
of debarment) or may leave it in force. However, a decision to modify or 
terminate the suspension shall be without prejudice to the subsequent 
imposition of suspension by any other agency or debarment by any agency. 
The decision shall be rendered in accordance with the following 
provisions:
    (a) No additional proceedings necessary. In actions: based on an 
indictment, conviction, or civil judgment; in which there is no genuine 
dispute over material facts; or in which additional proceedings to 
determine disputed material facts have been denied on the basis of 
Department of Justice advice, the suspending official shall make a 
decision on the basis of all the information in the administrative 
record, including any submission made by the respondent. The decision 
shall be made within 45 days after receipt of any information and 
argument submitted by the respondent, unless the suspending official 
extends this period for good cause.
    (b) Additional proceedings necessary. (1) In actions in which 
additional proceedings are necessary to determine disputed material 
facts, written findings of fact shall be prepared. The suspending 
official shall base the decision on the facts as found, together with 
any information and argument submitted by the respondent and any other 
information in the administrative record.
    (2) The suspending official may refer matters involving disputed 
material facts to another official for findings of fact. The suspending 
official may reject any such findings, in whole or in part, only after 
specifically determining them to be arbitrary or capricious or clearly 
erroneous.
    (c) Notice of suspending official's decision. Prompt written notice 
of the suspending official's decision shall be sent to the respondent.



Sec. 17.415  Period of suspension.

    (a) Suspension shall be for a temporary period pending the 
completion of an investigation or ensuing legal, debarment, or Program 
Fraud Civil Remedies Act proceedings, unless terminated sooner by the 
suspending official or as provided in paragraph (b) of this section.
    (b) If legal or administrative proceedings are not initiated within 
12 months after the date of the suspension notice,

[[Page 200]]

the suspension shall be terminated unless an Assistant Attorney General 
or United States Attorney requests its extension in writing, in which 
case it may be extended for an additional six months. In no event may a 
suspension extend beyond 18 months, unless such proceedings have been 
initiated within that period.
    (c) The suspending official shall notify the Department of Justice 
of an impending termination of a suspension, at least 30 days before the 
12-month period expires, to give that Department an opportunity to 
request an extension.



Sec. 17.420  Scope of suspension.

    The scope of a suspension is the same as the scope of a debarment 
(see Sec. 17.325), except that the procedures of Secs. 17.410 through 
17.413 shall be used in imposing a suspension.



       Subpart E--Responsibilities of GSA, Agency and Participants



Sec. 17.500  GSA responsibilities.

    (a) In accordance with the OMB guidelines, GSA shall compile, 
maintain, and distribute a list of all persons who have been debarred, 
suspended, or voluntarily excluded by agencies under Executive Order 
12549 and these regulations, and those who have been determined to be 
ineligible.
    (b) At a minimum, this list shall indicate:
    (1) The names and addresses of all debarred, suspended, ineligible, 
and voluntarily excluded persons, in alphabetical order, with cross-
references when more than one name is involved in a single action;
    (2) The type of action;
    (3) The cause for the action;
    (4) The scope of the action;
    (5) Any termination date for each listing; and
    (6) The agency and name and telephone number of the agency point of 
contact for the action.



Sec. 17.505  FEMA responsibilities.

    (a) The agency shall provide GSA with current information concerning 
debarments, suspension, determinations of ineligibility, and voluntary 
exclusions it has taken. Until February 18, 1989, the agency shall also 
provide GSA and OMB with information concerning all transactions in 
which FEMA has granted exceptions under Sec. 17.215 permitting 
participation by debarred, suspended, or voluntarily excluded persons.
    (b) Unless an alternative schedule is agreed to by GSA, the agency 
shall advise GSA of the information set forth in Sec. 17.500(b) and of 
the exceptions granted under Sec. 17.215 within five working days after 
taking such actions.
    (c) The agency shall direct inquiries concerning listed persons to 
the agency that took the action.
    (d) Agency officials shall check the Nonprocurement List before 
entering covered transactions to determine whether a participant in a 
primary transaction is debarred, suspended, ineligible, or voluntarily 
excluded (Tel. #).
    (e) Agency officials shall check the Nonprocurement List before 
approving principals or lower tier participants where agency approval of 
the principal or lower tier participant is required under the terms of 
the transaction, to determine whether such principals or participants 
are debarred, suspended, ineligible, or voluntarily excluded.



Sec. 17.510  Participants' responsibilities.

    (a) Certification by participants in primary covered transactions. 
Each participant shall submit the certification in appendix A to this 
part for it and its principals at the time the participant submits its 
proposal in connection with a primary covered transaction, except that 
States need only complete such certification as to their principals. 
Participants may decide the method and frequency by which they determine 
the eligibility of their principals. In addition, each participant may, 
but is not required to, check the Nonprocurement List for its principals 
(Tel. #). Adverse information on the certification will not 
necessarily result in denial of participation. However, the 
certification, and any additional information pertaining to the 
certification submitted by the participant, shall be considered in the 
administration of covered transactions.
    (b) Certification by participants in lower tier covered 
transactions. (1) Each

[[Page 201]]

participant shall require participants in lower tier covered 
transactions to include the certification in Appendix B to this part for 
it and its principals in any proposal submitted in connection with such 
lower tier covered transactions.
    (2) A participant may rely upon the certification of a prospective 
participant in a lower tier covered transaction that it and its 
principals are not debarred, suspended, ineligible, or voluntarily 
excluded from the covered transaction by any Federal agency, unless it 
knows that the certification is erroneous. Participants may decide the 
method and frequency by which they determine the eligiblity of their 
principals. In addition, a participant may, but is not required to, 
check the Nonprocurement List for its principals and for participants 
(Tel. #).
    (c) Changed circumstances regarding certification. A participant 
shall provide immediate written notice to FEMA if at any time the 
participant learns that its certification was erroneous when submitted 
or has become erroneous by reason of changed circumstances. Participants 
in lower tier covered transactions shall provide the same updated notice 
to the participant to which it submitted its proposals.



          Subpart F--Drug-Free Workplace Requirements (Grants)

    Source: 55 FR 21702, May 25, 1990, unless otherwise noted.



Sec. 17.600  Purpose.

    (a) The purpose of this subpart is to carry out the Drug-Free 
Workplace Act of 1988 by requiring that--
    (1) A grantee, other than an individual, shall certify to the agency 
that it will provide a drug-free workplace;
    (2) A grantee who is an individual shall certify to the agency that, 
as a condition of the grant, he or she will not engage in the unlawful 
manufacture, distribution, dispensing, possession or use of a controlled 
substance in conducting any activity with the grant.
    (b) Requirements implementing the Drug-Free Workplace Act of 1988 
for contractors with the agency are found at 48 CFR subparts 9.4, 23.5, 
and 52.2.



Sec. 17.605  Definitions.

    (a) Except as amended in this section, the definitions of 
Sec. 17.105 apply to this subpart.
    (b) For purposes of this subpart--
    (1) Controlled substance means a controlled substance in schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812), and as 
further defined by regulation at 21 CFR 1308.11 through 1308.15;
    (2) Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    (3) Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    (4) Drug-free workplace means a site for the performance of work 
done in connection with a specific grant at which employees of the 
grantee are prohibited from engaging in the unlawful manufacture, 
distribution, dispensing, possession, or use of a controlled substance;
    (5) Employee means the employee of a grantee directly engaged in the 
performance of work under the grant, including:
    (i) All ``direct charge'' employees;
    (ii) All ``indirect charge'' employees, unless their impact or 
involvement is insignificant to the performance of the grant; and,
    (iii) Temporary personnel and consultants who are directly engaged 
in the performance of work under the grant and who are on the grantee's 
payroll.

This definition does not include workers not on the payroll of the 
grantee (e.g., volunteers, even if used to meet a matching requirement; 
consultants or independent contractors not on the payroll; or employees 
of subrecipients or subcontractors in covered workplaces);

[[Page 202]]

    (6) Federal agency or agency means any United States executive 
department, military department, government corporation, government 
controlled corporation, any other establishment in the executive branch 
(including the Executive Office of the President), or any independent 
regulatory agency;
    (7) Grant means an award of financial assistance, including a 
cooperative agreement, in the form of money, or property in lieu of 
money, by a Federal agency directly to a grantee. The term grant 
includes block grant and entitlement grant programs, whether or not 
exempted from coverage under the grants management government-wide 
common rule on uniform administrative requirements for grants and 
cooperative agreements. The term does not include technical assistance 
that provides services instead of money, or other assistance in the form 
of loans, loan guarantees, interest subsidies, insurance, or direct 
appropriations; or any veterans' benefits to individuals, i.e., any 
benefit to veterans, their families, or survivors by virtue of the 
service of a veteran in the Armed Forces of the United States;
    (8) Grantee means a person who applies for or receives a grant 
directly from a Federal agency (except another Federal agency);
    (9) Individual means a natural person;
    (10) State means any of the States of the United States, the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or any agency of a State, exclusive of 
institutions of higher education, hospitals, and units of local 
government. A State instrumentality will be considered part of the State 
government if it has a written determination from a State government 
that such State considers the instrumentality to be an agency of the 
State government.



Sec. 17.610  Coverage.

    (a) This subpart applies to any grantee of the agency.
    (b) This subpart applies to any grant, except where application of 
this subpart would be inconsistent with the international obligations of 
the United States or the laws or regulations of a foreign government. A 
determination of such inconsistency may be made only by the agency head 
or his/her designee.
    (c) The provisions of subparts A, B, C, D and E of this part apply 
to matters covered by this subpart, except where specifically modified 
by this subpart. In the event of any conflict between provisions of this 
subpart and other provisions of this part, the provisions of this 
subpart are deemed to control with respect to the implementation of 
drug-free workplace requirements concerning grants.



Sec. 17.615  Grounds for suspension of payments, suspension or termination of grants, or suspension or debarment.

    A grantee shall be deemed in violation of the requirements of this 
subpart if the agency head or his or her official designee determines, 
in writing, that--
    (a) The grantee has made a false certification under Sec. 17.630;
    (b) With respect to a grantee other than an individual--
    (1) The grantee has violated the certification by failing to carry 
out the requirements of subparagraphs (A.) (a)-(g) and/or (B.) of the 
certification (Alternate I to appendix C) or
    (2) Such a number of employees of the grantee have been convicted of 
violations of criminal drug statutes for violations occurring in the 
workplace as to indicate that the grantee has failed to make a good 
faith effort to provide a drug-free workplace.
    (c) With respect to a grantee who is an individual--
    (1) The grantee has violated the certification by failing to carry 
out its requirements (Alternate II to appendix C); or
    (2) The grantee is convicted of a criminal drug offense resulting 
from a violation occurring during the conduct of any grant activity.



Sec. 17.620  Effect of violation.

    (a) In the event of a violation of this subpart as provided in 
Sec. 17.615, and in accordance with applicable law, the grantee shall be 
subject to one or more of the following actions:

[[Page 203]]

    (1) Suspension of payments under the grant;
    (2) Suspension or termination of the grant; and
    (3) Suspension or debarment of the grantee under the provisions of 
this part.
    (b) Upon issuance of any final decision under this part requiring 
debarment of a grantee, the debarred grantee shall be ineligible for 
award of any grant from any Federal agency for a period specified in the 
decision, not to exceed five years (see Sec. 17.320(a)(2) of this part).



Sec. 17.625  Exception provision.

    The agency head may waive with respect to a particular grant, in 
writing, a suspension of payments under a grant, suspension or 
termination of a grant, or suspension or debarment of a grantee if the 
agency head determines that such a waiver would be in the public 
interest. This exception authority cannot be delegated to any other 
official.



Sec. 17.630  Certification requirements and procedures.

    (a)(1) As a prior condition of being awarded a grant, each grantee 
shall make the appropriate certification to the Federal agency providing 
the grant, as provided in appendix C to this part.
    (2) Grantees are not required to make a certification in order to 
continue receiving funds under a grant awarded before March 18, 1989, or 
under a no-cost time extension of such a grant. However, the grantee 
shall make a one-time drug-free workplace certification for a non-
automatic continuation of such a grant made on or after March 18, 1989.
    (b) Except as provided in this section, all grantees shall make the 
required certification for each grant. For mandatory formula grants and 
entitlements that have no application process, grantees shall submit a 
one-time certification in order to continue receiving awards.
    (c) A grantee that is a State may elect to make one certification in 
each Federal fiscal year. States that previously submitted an annual 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. Except as provided in paragraph (d) of this 
section, this certification shall cover all grants to all State agencies 
from any Federal agency. The State shall retain the original of this 
statewide certification in its Governor's office and, prior to grant 
award, shall ensure that a copy is submitted individually with respect 
to each grant, unless the Federal agency has designated a central 
location for submission.
    (d)(1) The Governor of a State may exclude certain State agencies 
from the statewide certification and authorize these agencies to submit 
their own certifications to Federal agencies. The statewide 
certification shall name any State agencies so excluded.
    (2) A State agency to which the statewide certification does not 
apply, or a State agency in a State that does not have a statewide 
certification, may elect to make one certification in each Federal 
fiscal year. State agencies that previously submitted a State agency 
certification are not required to make a certification for Fiscal Year 
1990 until June 30, 1990. The State agency shall retain the original of 
this State agency-wide certification in its central office and, prior to 
grant award, shall ensure that a copy is submitted individually with 
respect to each grant, unless the Federal agency designates a central 
location for submission.
    (3) When the work of a grant is done by more than one State agency, 
the certification of the State agency directly receiving the grant shall 
be deemed to certify compliance for all workplaces, including those 
located in other State agencies.
    (e)(1) For a grant of less than 30 days performance duration, 
grantees shall have this policy statement and program in place as soon 
as possible, but in any case by a date prior to the date on which 
performance is expected to be completed.
    (2) For a grant of 30 days or more performance duration, grantees 
shall have this policy statement and program in place within 30 days 
after award.
    (3) Where extraordinary circumstances warrant for a specific grant, 
the grant officer may determine a different date on which the policy

[[Page 204]]

statement and program shall be in place.



Sec. 17.635  Reporting of and employee sanctions for convictions of criminal drug offenses.

    (a) When a grantee other than an individual is notified that an 
employee has been convicted for a violation of a criminal drug statute 
occurring in the workplace, it shall take the following actions:
    (1) Within 10 calendar days of receiving notice of the conviction, 
the grantee shall provide written notice, including the convicted 
employee's position title, to every grant officer, or other designee on 
whose grant activity the convicted employee was working, unless a 
Federal agency has designated a central point for the receipt of such 
notifications. Notification shall include the identification number(s) 
for each of the Federal agency's affected grants.
    (2) Within 30 calendar days of receiving notice of the conviction, 
the grantee shall do the following with respect to the employee who was 
convicted.
    (i) Take appropriate personnel action against the employee, up to 
and including termination, consistent with requirements of the 
Rehabilitation Act of 1973, as amended; or
    (ii) Require the employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency.
    (b) A grantee who is an individual who is convicted for a violation 
of a criminal drug statute occurring during the conduct of any grant 
activity shall report the conviction, in writing, within 10 calendar 
days, to his or her Federal agency grant officer, or other designee, 
unless the Federal agency has designated a central point for the receipt 
of such notices. Notification shall include the identification number(s) 
for each of the Federal agency's affected grants.

(Approved by the Office of Management and Budget under control number 
0991-0002.)

 Appendix A to Part 17--Certification Regarding Debarment, Suspension, 
     and Other Responsibility Matters--Primary Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective primary 
participant is providing the certification set out below.
    2. The inability of a person to provide the certification required 
below will not necessarily result in denial of participation in this 
covered transaction. The prospective participant shall submit an 
explanation of why it cannot provide the certification set out below. 
The certification or explanation will be considered in connection with 
the department or agency's determination whether to enter into this 
transaction. However, failure of the prospective primary participant to 
furnish a certification or an explanation shall disqualify such person 
from participation in this transaction.
    3. The certification in this clause is a material representation of 
fact upon which reliance was placed when the department or agency 
determined to enter into this transaction. If it is later determined 
that the prospective primary participant knowingly rendered an erroneous 
certification, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.
    4. The prospective primary participant shall provide immediate 
written notice to the department or agency to which this proposal is 
submitted if at any time the prospective primary participant learns that 
its certification was erroneous when submitted or has become erroneous 
by reason of changed circumstances.
    5. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meanings set out in the Definitions and Coverage 
sections of the rules implementing Executive Order 12549. You may 
contact the department or agency to which this proposal is being 
submitted for assistance in obtaining a copy of those regulations.
    6. The prospective primary participant agrees by submitting this 
proposal that, should the proposed covered transaction be entered into, 
it shall not knowingly enter into any lower tier covered transaction 
with a person who is proposed for debarment under 48 CFR part 9, subpart 
9.4, debarred, suspended, declared ineligible, or voluntarily excluded 
from participation in this covered

[[Page 205]]

transaction, unless authorized by the department or agency entering into 
this transaction.
    7. The prospective primary participant further agrees by submitting 
this proposal that it will include the clause titled ``Certification 
Regarding Debarment, Suspension, Ineligibility and Voluntary Exclusion-
Lower Tier Covered Transaction,'' provided by the department or agency 
entering into this covered transaction, without modification, in all 
lower tier covered transactions and in all solicitations for lower tier 
covered transactions.
    8. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from the covered transaction, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to, check the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs.
    9. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    10. Except for transactions authorized under paragraph 6 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency may terminate this transaction for 
cause or default.

Certification Regarding Debarment, Suspension, and Other Responsibility 
                  Matters--Primary Covered Transactions

    (1) The prospective primary participant certifies to the best of its 
knowledge and belief, that it and its principals:
    (a) Are not presently debarred, suspended, proposed for debarment, 
declared ineligible, or voluntarily excluded by any Federal department 
or agency;
    (b) Have not within a three-year period preceding this proposal been 
convicted of or had a civil judgment rendered against them for 
commission of fraud or a criminal offense in connection with obtaining, 
attempting to obtain, or performing a public (Federal, State or local) 
transaction or contract under a public transaction; violation of Federal 
or State antitrust statutes or commission of embezzlement, theft, 
forgery, bribery, falsification or destruction of records, making false 
statements, or receiving stolen property;
    (c) Are not presently indicted for or otherwise criminally or 
civilly charged by a governmental entity (Federal, State or local) with 
commission of any of the offenses enumerated in paragraph (1)(b) of this 
certification; and
    (d) Have not within a three-year period preceding this application/
proposal had one or more public transactions (Federal, State or local) 
terminated for cause or default.
    (2) Where the prospective primary participant is unable to certify 
to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.

[60 FR 33042, 33061, June 26, 1995]

 Appendix B to Part 17--Certification Regarding Debarment, Suspension, 
 Ineligibility and Voluntary Exclusion--Lower Tier Covered Transactions

                     Instructions for Certification

    1. By signing and submitting this proposal, the prospective lower 
tier participant is providing the certification set out below.
    2. The certification in this clause is a material representation of 
fact upon which reliance was placed when this transaction was entered 
into. If it is later determined that the prospective lower tier 
participant knowingly rendered an erroneous certification, in addition 
to other remedies available to the Federal Government the department or 
agency with which this transaction originated may pursue available 
remedies, including suspension and/or debarment.
    3. The prospective lower tier participant shall provide immediate 
written notice to the person to which this proposal is submitted if at 
any time the prospective lower tier participant learns that its 
certification was erroneous when submitted or had become erroneous by 
reason of changed circumstances.
    4. The terms covered transaction, debarred, suspended, ineligible, 
lower tier covered transaction, participant, person, primary covered 
transaction, principal, proposal, and voluntarily excluded, as used in 
this clause, have the meaning set out in the Definitions and Coverage 
sections of rules implementing Executive Order 12549. You may contact 
the person to which this proposal is submitted for assistance in 
obtaining a copy of those regulations.
    5. The prospective lower tier participant agrees by submitting this 
proposal that, should the proposed covered transaction be

[[Page 206]]

entered into, it shall not knowingly enter into any lower tier covered 
transaction with a person who is proposed for debarment under 48 CFR 
part 9, subpart 9.4, debarred, suspended, declared ineligible, or 
voluntarily excluded from participation in this covered transaction, 
unless authorized by the department or agency with which this 
transaction originated.
    6. The prospective lower tier participant further agrees by 
submitting this proposal that it will include this clause titled 
``Certification Regarding Debarment, Suspension, Ineligibility and 
Voluntary Exclusion-Lower Tier Covered Transaction,'' without 
modification, in all lower tier covered transactions and in all 
solicitations for lower tier covered transactions.
    7. A participant in a covered transaction may rely upon a 
certification of a prospective participant in a lower tier covered 
transaction that it is not proposed for debarment under 48 CFR part 9, 
subpart 9.4, debarred, suspended, ineligible, or voluntarily excluded 
from covered transactions, unless it knows that the certification is 
erroneous. A participant may decide the method and frequency by which it 
determines the eligibility of its principals. Each participant may, but 
is not required to, check the List of Parties Excluded from Federal 
Procurement and Nonprocurement Programs.
    8. Nothing contained in the foregoing shall be construed to require 
establishment of a system of records in order to render in good faith 
the certification required by this clause. The knowledge and information 
of a participant is not required to exceed that which is normally 
possessed by a prudent person in the ordinary course of business 
dealings.
    9. Except for transactions authorized under paragraph 5 of these 
instructions, if a participant in a covered transaction knowingly enters 
into a lower tier covered transaction with a person who is proposed for 
debarment under 48 CFR part 9, subpart 9.4, suspended, debarred, 
ineligible, or voluntarily excluded from participation in this 
transaction, in addition to other remedies available to the Federal 
Government, the department or agency with which this transaction 
originated may pursue available remedies, including suspension and/or 
debarment.

    Certification Regarding Debarment, Suspension, Ineligibility an 
          Voluntary Exclusion--Lower Tier Covered Transactions

    (1) The prospective lower tier participant certifies, by submission 
of this proposal, that neither it nor its principals is presently 
debarred, suspended, proposed for debarment, declared ineligible, or 
voluntarily excluded from participation in this transaction by any 
Federal department or agency.
    (2) Where the prospective lower tier participant is unable to 
certify to any of the statements in this certification, such prospective 
participant shall attach an explanation to this proposal.

[60 FR 33042, 33061, June 26, 1995]

   Appendix C to Part 17--Certification Regarding Drug-Free Workplace 
                              Requirements

                     Instructions for Certification

    1. By signing and/or submitting this application or grant agreement, 
the grantee is providing the certification set out below.
    2. The certification set out below is a material representation of 
fact upon which reliance is placed when the agency awards the grant. If 
it is later determined that the grantee knowingly rendered a false 
certification, or otherwise violates the requirements of the Drug-Free 
Workplace Act, the agency, in addition to any other remedies available 
to the Federal Government, may take action authorized under the Drug-
Free Workplace Act.
    3. For grantees other than individuals, Alternate I applies.
    4. For grantees who are individuals, Alternate II applies.
    5. Workplaces under grants, for grantees other than individuals, 
need not be identified on the certification. If known, they may be 
identified in the grant application. If the grantee does not identify 
the workplaces at the time of application, or upon award, if there is no 
application, the grantee must keep the identity of the workplace(s) on 
file in its office and make the information available for Federal 
inspection. Failure to identify all known workplaces constitutes a 
violation of the grantee's drug-free workplace requirements.
    6. Workplace identifications must include the actual address of 
buildings (or parts of buildings) or other sites where work under the 
grant takes place. Categorical descriptions may be used (e.g., all 
vehicles of a mass transit authority or State highway department while 
in operation, State employees in each local unemployment office, 
performers in concert halls or radio studios).
    7. If the workplace identified to the agency changes during the 
performance of the grant, the grantee shall inform the agency of the 
change(s), if it previously identified the workplaces in question (see 
paragraph five).
    8. Definitions of terms in the Nonprocurement Suspension and 
Debarment common rule and Drug-Free Workplace common rule apply to this 
certification. Grantees' attention is called, in particular, to the 
following definitions from these rules:
    Controlled substance means a controlled substance in Schedules I 
through V of the Controlled Substances Act (21 U.S.C. 812) and as 
further defined by regulation (21 CFR 1308.11 through 1308.15);

[[Page 207]]

    Conviction means a finding of guilt (including a plea of nolo 
contendere) or imposition of sentence, or both, by any judicial body 
charged with the responsibility to determine violations of the Federal 
or State criminal drug statutes;
    Criminal drug statute means a Federal or non-Federal criminal 
statute involving the manufacture, distribution, dispensing, use, or 
possession of any controlled substance;
    Employee means the employee of a grantee directly engaged in the 
performance of work under a grant, including: (i) All ``direct charge'' 
employees; (ii) all ``indirect charge'' employees unless their impact or 
involvement is insignificant to the performance of the grant; and, (iii) 
temporary personnel and consultants who are directly engaged in the 
performance of work under the grant and who are on the grantee's 
payroll. This definition does not include workers not on the payroll of 
the grantee (e.g., volunteers, even if used to meet a matching 
requirement; consultants or independent contractors not on the grantee's 
payroll; or employees of subrecipients or subcontractors in covered 
workplaces).

        Certification Reqardinq Druq-Free Workplace Requirements

             Alternate I. (Grantees Other Than Individuals)

    A. The grantee certifies that it will or will continue to provide a 
drug-free workplace by:
    (a) Publishing a statement notifying employees that the unlawful 
manufacture, distribution, dispensing, possession, or use of a 
controlled substance is prohibited in the grantee's workplace and 
specifying the actions that will be taken against employees for 
violation of such prohibition;
    (b) Establishing an ongoing drug-free awareness program to inform 
employees about--
    (1) The dangers of drug abuse in the workplace;
    (2) The grantee's policy of maintaining a drug-free workplace;
    (3) Any available drug counseling, rehabilitation, and employee 
assistance programs; and
    (4) The penalties that may be imposed upon employees for drug abuse 
violations occurring in the workplace;
    (c) Making it a requirement that each employee to be engaged in the 
performance of the grant be given a copy of the statement required by 
paragraph (a);
    (d) Notifying the employee in the statement required by paragraph 
(a) that, as a condition of employment under the grant, the employee 
will--
    (1) Abide by the terms of the statement; and
    (2) Notify the employer in writing of his or her conviction for a 
violation of a criminal drug statute occurring in the workplace no later 
than five calendar days after such conviction;
    (e) Notifying the agency in writing, within ten calendar days after 
receiving notice under subparagraph (d)(2) from an employee or otherwise 
receiving actual notice of such conviction. Employers of convicted 
employees must provide notice, including position title, to every grant 
officer or other designee on whose grant activity the convicted employee 
was working, unless the Federal agency has designated a central point 
for the receipt of such notices. Notice shall include the identification 
number(s) of each affected grant;
    (f) Taking one of the following actions, within 30 calendar days of 
receiving notice under subparagraph (d)(2), with respect to any employee 
who is so convicted--
    (1) Taking appropriate personnel action against such an employee, up 
to and including termination, consistent with the requirements of the 
Rehabilitation Act of 1973, as amended; or
    (2) Requiring such employee to participate satisfactorily in a drug 
abuse assistance or rehabilitation program approved for such purposes by 
a Federal, State, or local health, law enforcement, or other appropriate 
agency;
    (g) Making a good faith effort to continue to maintain a drug-free 
workplace through implementation of paragraphs (a), (b), (c), (d), (e) 
and (f).
    B. The grantee may insert in the space provided below the site(s) 
for the performance of work done in connection with the specific grant:

    Place of Performance (Street address, city, county, state, zip code)

 _______________________________________________________________________

________________________________________________________________________

________________________________________________________________________

Check □ if there are workplaces on file that are not identified 
here.

              Alternate II. (Grantees Who Are Individuals)

    (a) The grantee certifies that, as a condition of the grant, he or 
she will not engage in the unlawful manufacture, distribution, 
dispensing, possession, or use of a controlled substance in conducting 
any activity with the grant;
    (b) If convicted of a criminal drug offense resulting from a 
violation occurring during the conduct of any grant activity, he or she 
will report the conviction, in writing, within 10 calendar days of the 
conviction, to every grant officer or other designee, unless the Federal 
agency designates a central point for the receipt of such notices. When 
notice is

[[Page 208]]

made to such a central point, it shall include the identification 
number(s) of each affected grant.

[55 FR 21702, May 25, 1990]



PART 18--NEW RESTRICTIONS ON LOBBYING--Table of Contents




                           Subpart A--General

Sec.
18.100  Conditions on use of funds.
18.105  Definitions.
18.110  Certification and disclosure.

                 Subpart B--Activities by Own Employees

18.200  Agency and legislative liaison.
18.205  Professional and technical services.
18.210  Reporting.

            Subpart C--Activities by Other Than Own Employees

18.300  Professional and technical services.

                  Subpart D--Penalties and Enforcement

18.400  Penalties.
18.405  Penalty procedures.
18.410  Enforcement.

                          Subpart E--Exemptions

18.500  Secretary of Defense.

                        Subpart F--Agency Reports

18.600  Semi-annual compilation.
18.605  Inspector General report.

Appendix A to Part 18--Certification Regarding Lobbying
Appendix B to Part 18--Disclosure Form To Report Lobbying

    Authority: Section 319, Public Law 101-121 (31 U.S.C. 1352); 5 
U.S.C. 551, 552, 553; 5 U.S.C. 601, et seq.; E.O. 12291. Reorganization 
Plan No. 3 of 1978, E.O. 12127, E.O. 12148, E.O. 12657, E.O. 12699.

    Source: 55 FR 6737 and 6754, Feb. 26, 1990, unless otherwise noted.


    Cross reference:  See also Office of Management and Budget notice 
published at 54 FR 52306, December 20, 1989.



                           Subpart A--General



Sec. 18.100  Conditions on use of funds.

    (a) No appropriated funds may be expended by the recipient of a 
Federal contract, grant, loan, or cooperative ageement to pay any person 
for influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with any of the following 
covered Federal actions: the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (b) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or cooperative agreement shall file with that 
agency a certification, set forth in appendix A, that the person has not 
made, and will not make, any payment prohibited by paragraph (a) of this 
section.
    (c) Each person who requests or receives from an agency a Federal 
contract, grant, loan, or a cooperative agreement shall file with that 
agency a disclosure form, set forth in appendix B, if such person has 
made or has agreed to make any payment using nonappropriated funds (to 
include profits from any covered Federal action), which would be 
prohibited under paragraph (a) of this section if paid for with 
appropriated funds.
    (d) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a statement, set forth in appendix A, whether that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with that loan insurance or guarantee.
    (e) Each person who requests or receives from an agency a commitment 
providing for the United States to insure or guarantee a loan shall file 
with that agency a disclosure form, set forth in appendix B, if that 
person has made or has agreed to make any payment to influence or 
attempt to influence an officer or employee of any agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a

[[Page 209]]

Member of Congress in connection with that loan insurance or guarantee.



Sec. 18.105  Definitions.

    For purposes of this part:
    (a) Agency, as defined in 5 U.S.C. 552(f), includes Federal 
executive departments and agencies as well as independent regulatory 
commissions and Government corporations, as defined in 31 U.S.C. 
9101(1).
    (b) Covered Federal action means any of the following Federal 
actions:
    (1) The awarding of any Federal contract;
    (2) The making of any Federal grant;
    (3) The making of any Federal loan;
    (4) The entering into of any cooperative agreement; and,
    (5) The extension, continuation, renewal, amendment, or modification 
of any Federal contract, grant, loan, or cooperative agreement.

Covered Federal action does not include receiving from an agency a 
commitment providing for the United States to insure or guarantee a 
loan. Loan guarantees and loan insurance are addressed independently 
within this part.
    (c) Federal contract means an acquisition contract awarded by an 
agency, including those subject to the Federal Acquisition Regulation 
(FAR), and any other acquisition contract for real or personal property 
or services not subject to the FAR.
    (d) Federal cooperative agreement means a cooperative agreement 
entered into by an agency.
    (e) Federal grant means an award of financial assistance in the form 
of money, or property in lieu of money, by the Federal Government or a 
direct appropriation made by law to any person. The term does not 
include technical assistance which provides services instead of money, 
or other assistance in the form of revenue sharing, loans, loan 
guarantees, loan insurance, interest subsidies, insurance, or direct 
United States cash assistance to an individual.
    (f) Federal loan means a loan made by an agency. The term does not 
include loan guarantee or loan insurance.
    (g) Indian tribe and tribal organization have the meaning provided 
in section 4 of the Indian Self-Determination and Education Assistance 
Act (25 U.S.C. 450B). Alaskan Natives are included under the definitions 
of Indian tribes in that Act.
    (h) Influencing or attempting to influence means making, with the 
intent to influence, any communication to or appearance before an 
officer or employee or any agency, a Member of Congress, an officer or 
employee of Congress, or an employee of a Member of Congress in 
connection with any covered Federal action.
    (i) Loan guarantee and loan insurance means an agency's guarantee or 
insurance of a loan made by a person.
    (j) Local government means a unit of government in a State and, if 
chartered, established, or otherwise recognized by a State for the 
performance of a governmental duty, including a local public authority, 
a special district, an intrastate district, a council of governments, a 
sponsor group representative organization, and any other instrumentality 
of a local government.
    (k) Officer or employee of an agency includes the following 
individuals who are employed by an agency:
    (1) An individual who is appointed to a position in the Government 
under title 5, U.S. Code, including a position under a temporary 
appointment;
    (2) A member of the uniformed services as defined in section 101(3), 
title 37, U.S. Code;
    (3) A special Government employee as defined in section 202, title 
18, U.S. Code; and,
    (4) An individual who is a member of a Federal advisory committee, 
as defined by the Federal Advisory Committee Act, title 5, U.S. Code 
appendix 2.
    (l) Person means an individual, corporation, company, association, 
authority, firm, partnership, society, State, and local government, 
regardless of whether such entity is operated for profit or not for 
profit. This term excludes an Indian tribe, tribal organization, or any 
other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (m) Reasonable compensation means, with respect to a regularly 
employed officer or employee of any person, compensation that is 
consistent with the normal compensation for such officer

[[Page 210]]

or employee for work that is not furnished to, not funded by, or not 
furnished in cooperation with the Federal Government.
    (n) Reasonable payment means, with respect to perfessional and other 
technical services, a payment in an amount that is consistent with the 
amount normally paid for such services in the private sector.
    (o) Recipient includes all contractors, subcontractors at any tier, 
and subgrantees at any tier of the recipient of funds received in 
connection with a Federal contract, grant, loan, or cooperative 
agreement. The term excludes an Indian tribe, tribal organization, or 
any other Indian organization with respect to expenditures specifically 
permitted by other Federal law.
    (p) Regularly employed means, with respect to an officer or employee 
of a person requesting or receiving a Federal contract, grant, loan, or 
cooperative agreement or a commitment providing for the United States to 
insure or guarantee a loan, an officer or employee who is employed by 
such person for at least 130 working days within one year immediately 
preceding the date of the submission that initiates agency consideration 
of such person for receipt of such contract, grant, loan, cooperative 
agreement, loan insurance commitment, or loan guarantee commitment. An 
officer or employee who is employed by such person for less than 130 
working days within one year immediately preceding the date of the 
submission that initiates agency consideration of such person shall be 
considered to be regularly employed as soon as he or she is employed by 
such person for 130 working days.
    (q) State means a State of the United States, the District of 
Columbia, the Commonwealth of Puerto Rico, a territory or possession of 
the United States, an agency or instrumentality of a State, and a multi-
State, regional, or interstate entity having governmental duties and 
powers.



Sec. 18.110  Certification and disclosure.

    (a) Each person shall file a certification, and a disclosure form, 
if required, with each submission that initiates agency consideration of 
such person for:
    (1) Award of a Federal contract, grant, or cooperative agreement 
exceeding $100,000; or
    (2) An award of a Federal loan or a commitment providing for the 
United States to insure or guarantee a loan exceeding $150,000.
    (b) Each person shall file a certification, and a disclosure form, 
if required, upon receipt by such person of:
    (1) A Federal contract, grant, or cooperative agreement exceeding 
$100,000; or
    (2) A Federal loan or a commitment providing for the United States 
to insure or guarantee a loan exceeding $150,000, unless such person 
previously filed a certification, and a disclosure form, if required, 
under paragraph (a) of this section.
    (c) Each person shall file a disclosure form at the end of each 
calendar quarter in which there occurs any event that requires 
disclosure or that materially affects the accuracy of the information 
contained in any disclosure form previously filed by such person under 
paragraphs (a) or (b) of this section. An event that materially affects 
the accuracy of the information reported includes:
    (1) A cumulative increase of $25,000 or more in the amount paid or 
expected to be paid for influencing or attempting to influence a covered 
Federal action; or
    (2) A change in the person(s) or individual(s) influencing or 
attempting to influence a covered Federal action; or,
    (3) A change in the officer(s), employee(s), or Member(s) contacted 
to influence or attempt to influence a covered Federal action.
    (d) Any person who requests or receives from a person referred to in 
paragraphs (a) or (b) of this section:
    (1) A subcontract exceeding $100,000 at any tier under a Federal 
contract;
    (2) A subgrant, contract, or subcontract exceeding $100,000 at any 
tier under a Federal grant;
    (3) A contract or subcontract exceeding $100,000 at any tier under a 
Federal loan exceeding $150,000; or,
    (4) A contract or subcontract exceeding $100,000 at any tier under a 
Federal cooperative agreement,


[[Page 211]]



shall file a certification, and a disclosure form, if required, to the 
next tier above.
    (e) All disclosure forms, but not certifications, shall be forwarded 
from tier to tier until received by the person referred to in paragraphs 
(a) or (b) of this section. That person shall forward all disclosure 
forms to the agency.
    (f) Any certification or disclosure form filed under paragraph (e) 
of this section shall be treated as a material representation of fact 
upon which all receiving tiers shall rely. All liability arising from an 
erroneous representation shall be borne solely by the tier filing that 
representation and shall not be shared by any tier to which the 
erroneous representation is forwarded. Submitting an erroneous 
certification or disclosure constitutes a failure to file the required 
certification or disclosure, respectively. If a person fails to file a 
required certification or disclosure, the United States may pursue all 
available remedies, including those authorized by section 1352, title 
31, U.S. Code.
    (g) For awards and commitments in process prior to December 23, 
1989, but not made before that date, certifications shall be required at 
award or commitment, covering activities occurring between December 23, 
1989, and the date of award or commitment. However, for awards and 
commitments in process prior to the December 23, 1989 effective date of 
these provisions, but not made before December 23, 1989, disclosure 
forms shall not be required at time of award or commitment but shall be 
filed within 30 days.
    (h) No reporting is required for an activity paid for with 
appropriated funds if that activity is allowable under either subpart B 
or C.



                 Subpart B--Activities by Own Employees



Sec. 18.200  Agency and legislative liaison.

    (a) The prohibition on the use of appropriated funds, in Sec. 18.100 
(a), does not apply in the case of a payment of reasonable compensation 
made to an officer or employee of a person requesting or receiving a 
Federal contract, grant, loan, or cooperative agreement if the payment 
is for agency and legislative liaison activities not directly related to 
a covered Federal action.
    (b) For purposes of paragraph (a) of this section, providing any 
information specifically requested by an agency or Congress is allowable 
at any time.
    (c) For purposes of paragraph (a) of this section, the following 
agency and legislative liaison activities are allowable at any time only 
where they are not related to a specific solicitation for any covered 
Federal action:
    (1) Discussing with an agency (including individual demonstrations) 
the qualities and characteristics of the person's products or services, 
conditions or terms of sale, and service capabilities; and,
    (2) Technical discussions and other activities regarding the 
application or adaptation of the person's products or services for an 
agency's use.
    (d) For purposes of paragraph (a) of this section, the following 
agencies and legislative liaison activities are allowable only where 
they are prior to formal solicitation of any covered Federal action:
    (1) Providing any information not specifically requested but 
necessary for an agency to make an informed decision about initiation of 
a covered Federal action;
    (2) Technical discussions regarding the preparation of an 
unsolicited proposal prior to its official submission; and,
    (3) Capability presentations by persons seeking awards from an 
agency pursuant to the provisions of the Small Business Act, as amended 
by Public Law 95-507 and other subsequent amendments.
    (e) Only those activities expressly authorized by this section are 
allowable under this section.



Sec. 18.205  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in Sec. 18.100 
(a), does not apply in the case of a payment of reasonable compensation 
made to an officer or employee of a person requesting or receiving a 
Federal contract, grant, loan, or cooperative agreement or an extension, 
continuation, renewal,

[[Page 212]]

amendment, or modification of a Federal contract, grant, loan, or 
cooperative agreement if payment is for professional or technical 
services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting of a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a contract is allowable. However, 
communications with the intent to influence made by a professional (such 
as a licensed lawyer) or a technical person (such as a licensed 
accountant) are not allowable under this section unless they provide 
advice and analysis directly applying their professional or technical 
expertise and unless the advice or analysis is rendered directly and 
solely in the preparation, submission or negotiation of a covered 
Federal action. Thus, for example, communications with the intent to 
influence made by a lawyer that do not provide legal advice or analysis 
directly and solely related to the legal aspects of his or her client's 
proposal, but generally advocate one proposal over another are not 
allowable under this section because the lawyer is not providing 
professional legal services. Similarly, communications with the intent 
to influence made by an engineer providing an engineering analysis prior 
to the preparation or submission of a bid or proposal are not allowable 
under this section since the engineer is providing technical services 
but not directly in the preparation, submission or negotiation of a 
covered Federal action.
    (c) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (d) Only those services expressly authorized by this section are 
allowable under this section.



Sec. 18.210  Reporting.

    No reporting is required with respect to payments of reasonable 
compensation made to regularly employed officers or employees of a 
person.



            Subpart C--Activities by Other Than Own Employees



Sec. 18.300  Professional and technical services.

    (a) The prohibition on the use of appropriated funds, in Sec. 18.100 
(a), does not apply in the case of any reasonable payment to a person, 
other than an officer or employee of a person requesting or receiving a 
covered Federal action, if the payment is for professional or technical 
services rendered directly in the preparation, submission, or 
negotiation of any bid, proposal, or application for that Federal 
contract, grant, loan, or cooperative agreement or for meeting 
requirements imposed by or pursuant to law as a condition for receiving 
that Federal contract, grant, loan, or cooperative agreement.
    (b) The reporting requirements in Sec. 18.110 (a) and (b) regarding 
filing a disclosure form by each person, if required, shall not apply 
with respect to professional or technical services rendered directly in 
the preparation, submission, or negotiation of any commitment providing 
for the United States to insure or guarantee a loan.
    (c) For purposes of paragraph (a) of this section, ``professional 
and technical services'' shall be limited to advice and analysis 
directly applying any professional or technical discipline. For example, 
drafting or a legal document accompanying a bid or proposal by a lawyer 
is allowable. Similarly, technical advice provided by an engineer on the 
performance or operational capability of a piece of equipment rendered 
directly in the negotiation of a

[[Page 213]]

contract is allowable. However, communications with the intent to 
influence made by a professional (such as a licensed lawyer) or a 
technical person (such as a licensed accountant) are not allowable under 
this section unless they provide advice and analysis directly applying 
their professional or technical expertise and unless the advice or 
analysis is rendered directly and solely in the preparation, submission 
or negotiation of a covered Federal action. Thus, for example, 
communications with the intent to influence made by a lawyer that do not 
provide legal advice or analysis directly and solely related to the 
legal aspects of his or her client's proposal, but generally advocate 
one proposal over another are not allowable under this section because 
the lawyer is not providing professional legal services. Similarly, 
communications with the intent to influence made by an engineer 
providing an engineering analysis prior to the preparation or submission 
of a bid or proposal are not allowable under this section since the 
engineer is providing technical services but not directly in the 
preparation, submission or negotiation of a covered Federal action.
    (d) Requirements imposed by or pursuant to law as a condition for 
receiving a covered Federal award include those required by law or 
regulation, or reasonably expected to be required by law or regulation, 
and any other requirements in the actual award documents.
    (e) Persons other than officers or employees of a person requesting 
or receiving a covered Federal action include consultants and trade 
associations.
    (f) Only those services expressly authorized by this section are 
allowable under this section.



                  Subpart D--Penalties and Enforcement



Sec. 18.400  Penalties.

    (a) Any person who makes an expenditure prohibited herein shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such expenditure.
    (b) Any person who fails to file or amend the disclosure form (see 
appendix B) to be filed or amended if required herein, shall be subject 
to a civil penalty of not less than $10,000 and not more than $100,000 
for each such failure.
    (c) A filing or amended filing on or after the date on which an 
administrative action for the imposition of a civil penalty is commenced 
does not prevent the imposition of such civil penalty for a failure 
occurring before that date. An administrative action is commenced with 
respect to a failure when an investigating official determines in 
writing to commence an investigation of an allegation of such failure.
    (d) In determining whether to impose a civil penalty, and the amount 
of any such penalty, by reason of a violation by any person, the agency 
shall consider the nature, circumstances, extent, and gravity of the 
violation, the effect on the ability of such person to continue in 
business, any prior violations by such person, the degree of culpability 
of such person, the ability of the person to pay the penalty, and such 
other matters as may be appropriate.
    (e) First offenders under paragraphs (a) or (b) of this section 
shall be subject to a civil penalty of $10,000, absent aggravating 
circumstances. Second and subsequent offenses by persons shall be 
subject to an appropriate civil penalty between $10,000 and $100,000, as 
determined by the agency head or his or her designee.
    (f) An imposition of a civil penalty under this section does not 
prevent the United States from seeking any other remedy that may apply 
to the same conduct that is the basis for the imposition of such civil 
penalty.



Sec. 18.405  Penalty procedures.

    Agencies shall impose and collect civil penalties pursuant to the 
provisions of the Program Fraud and Civil Remedies Act, 31 U.S.C. 3803 
(except subsection (c)), 3804, 3805, 3806, 3807, 3808, and 3812, insofar 
as these provisions are not inconsistent with the requirements herein.



Sec. 18.410  Enforcement.

    The head of each agency shall take such actions as are necessary to 
ensure

[[Page 214]]

that the provisions herein are vigorously implemented and enforced in 
that agency.



                          Subpart E--Exemptions



Sec. 18.500  Secretary of Defense.

    (a) The Secretary of Defense may exempt, on a case-by-case basis, a 
covered Federal action from the prohibition whenever the Secretary 
determines, in writing, that such an exemption is in the national 
interest. The Secretary shall transmit a copy of each such written 
exemption to Congress immediately after making such a determination.
    (b) The Department of Defense may issue supplemental regulations to 
implement paragraph (a) of this section.



                        Subpart F--Agency Reports



Sec. 18.600  Semi-annual compilation.

    (a) The head of each agency shall collect and compile the disclosure 
reports (see appendix B) and, on May 31 and November 30 of each year, 
submit to the Secretary of the Senate and the Clerk of the House of 
Representatives a report containing a compilation of the information 
contained in the disclosure reports received during the six-month period 
ending on March 31 or September 30, respectively, of that year.
    (b) The report, including the compilation, shall be available for 
public inspection 30 days after receipt of the report by the Secretary 
and the Clerk.
    (c) Information that involves intelligence matters shall be reported 
only to the Select Committee on Intelligence of the Senate, the 
Permanent Select Committee on Intelligence of the House of 
Representatives, and the Committees on Appropriations of the Senate and 
the House of Representatives in accordance with procedures agreed to by 
such committees. Such information shall not be available for public 
inspection.
    (d) Information that is classified under Executive Order 12356 or 
any successor order shall be reported only to the Committee on Foreign 
Relations of the Senate and the Committee on Foreign Affairs of the 
House of Representatives or the Committees on Armed Services of the 
Senate and the House of Representatives (whichever such committees have 
jurisdiction of matters involving such information) and to the 
Committees on Appropriations of the Senate and the House of 
Representatives in accordance with procedures agreed to by such 
committees. Such information shall not be available for public 
inspection.
    (e) The first semi-annual compilation shall be submitted on May 31, 
1990, and shall contain a compilation of the disclosure reports received 
from December 23, 1989 to March 31, 1990.
    (f) Major agencies, designated by the Office of Management and 
Budget (OMB), are required to provide machine-readable compilations to 
the Secretary of the Senate and the Clerk of the House of 
Representatives no later than with the compilations due on May 31, 1991. 
OMB shall provide detailed specifications in a memorandum to these 
agencies.
    (g) Non-major agencies are requested to provide machine-readable 
compilations to the Secretary of the Senate and the Clerk of the House 
of Representatives.
    (h) Agencies shall keep the originals of all disclosure reports in 
the official files of the agency.



Sec. 18.605  Inspector General report.

    (a) The Inspector General, or other official as specified in 
paragraph (b) of this section, of each agency shall prepare and submit 
to Congress each year, commencing with submission of the President's 
Budget in 1991, an evaluation of the compliance of that agency with, and 
the effectiveness of, the requirements herein. The evaluation may 
include any recommended changes that may be necessary to strengthen or 
improve the requirements.
    (b) In the case of an agency that does not have an Inspector 
General, the agency official comparable to an Inspector General shall 
prepare and submit the annual report, or, if there is no such comparable 
official, the head of the agency shall prepare and submit the annual 
report.
    (c) The annual report shall be submitted at the same time the agency 
submits its annual budget justifications to Congress.

[[Page 215]]

    (d) The annual report shall include the following: All alleged 
violations relating to the agency's covered Federal actions during the 
year covered by the report, the actions taken by the head of the agency 
in the year covered by the report with respect to those alleged 
violations and alleged violations in previous years, and the amounts of 
civil penalties imposed by the agency in the year covered by the report.

         Appendix A to Part 18--Certification Regarding Lobbying

 Certification for Contracts, Grants, Loans, and Cooperative Agreements

    The undersigned certifies, to the best of his or her knowledge and 
belief, that:
    (1) No Federal appropriated funds have been paid or will be paid, by 
or on behalf of the undersigned, to any person for influencing or 
attempting to influence an officer or employee of an agency, a Member of 
Congress, an officer or employee of Congress, or an employee of a Member 
of Congress in connection with the awarding of any Federal contract, the 
making of any Federal grant, the making of any Federal loan, the 
entering into of any cooperative agreement, and the extension, 
continuation, renewal, amendment, or modification of any Federal 
contract, grant, loan, or cooperative agreement.
    (2) If any funds other than Federal appropriated funds have been 
paid or will be paid to any person for influencing or attempting to 
influence an officer or employee of any agency, a Member of Congress, an 
officer or employee of Congress, or an employee of a Member of Congress 
in connection with this Federal contract, grant, loan, or cooperative 
agreement, the undersigned shall complete and submit Standard Form-LLL, 
``Disclosure Form to Report Lobbying,'' in accordance with its 
instructions.
    (3) The undersigned shall require that the language of this 
certification be included in the award documents for all subawards at 
all tiers (including subcontracts, subgrants, and contracts under 
grants, loans, and cooperative agreements) and that all subrecipients 
shall certify and disclose accordingly.
    This certification is a material representation of fact upon which 
reliance was placed when this transaction was made or entered into. 
Submission of this certification is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required certification shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 for each such failure.

            Statement for Loan Guarantees and Loan Insurance

    The undersigned states, to the best of his or her knowledge and 
belief, that:
    If any funds have been paid or will be paid to any person for 
influencing or attempting to influence an officer or employee of any 
agency, a Member of Congress, an officer or employee of Congress, or an 
employee of a Member of Congress in connection with this commitment 
providing for the United States to insure or guarantee a loan, the 
undersigned shall complete and submit Standard Form-LLL, ``Disclosure 
Form to Report Lobbying,'' in accordance with its instructions.
    Submission of this statement is a prerequisite for making or 
entering into this transaction imposed by section 1352, title 31, U.S. 
Code. Any person who fails to file the required statement shall be 
subject to a civil penalty of not less than $10,000 and not more than 
$100,000 f

[[Page 216]]

or each such failure.

        Appendix B to Part 18--Disclosure Form To Report Lobbying
[GRAPHIC] [TIFF OMITTED] TC02FE91.075


[[Page 217]]

[GRAPHIC] [TIFF OMITTED] TC02FE91.076



[[Page 218]]

[GRAPHIC] [TIFF OMITTED] TC02FE91.077



[[Page 219]]



PARTS 19-24 [RESERVED]






PART 25--UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS--Table of Contents




    Authority: Sec. 213, Uniform Relocation Assistance and Real Property 
Acquisition Policies Act of 1970, Pub. L. 91-646, 84 Stat. 1894 (42 
U.S.C. 4601) as amended by the Surface Transportation and Uniform 
Relocation Assistance Act of 1987, title IV of Pub. L. 100-17, 101 Stat. 
246-256 (42 U.S.C. 4601 note).



Pts. 26-25.1  Uniform relocation assistance and real property acquisition.

    Regulations and procedures for complying with the Uniform Relocation 
Assistance and Real Property Acquisition Policies Act of 1970 (Pub. L. 
91-646, 84 Stat. 1894, 42 U.S.C. 4601), as amended by the Surface 
Transportation and Uniform Relocation Assistance Act of 1987 (title IV 
of Pub. L. 100-17, 101 Stat. 246-256, 42 U.S.C. 4601 note) are set forth 
in 49 CFR part 24.

[52 FR 48026, Dec. 17, 1987 and 54 FR 8912, Mar. 2, 1989]



PARTS 26-49 [RESERVED]




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              SUBCHAPTER B--INSURANCE AND HAZARD MITIGATION





PARTS 50-54 [RESERVED]




                 National Insurance Development Program



PARTS 55-58 [RESERVED]




                    National Flood Insurance Program



PART 59--GENERAL PROVISIONS--Table of Contents




                           Subpart A--General

Sec.
59.1  Definitions.
59.2  Description of program.
59.3  Emergency program.
59.4  References.

                   Subpart B--Eligibility Requirements

59.21  Purpose of subpart.
59.22  Prerequisites for the sale of flood insurance.
59.23  Priorities for the sale of flood insurance under the regular 
          program.
59.24  Suspension of community eligibility.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329, 43 FR 41943; E.O. 12127, 3 CFR, 1979 
Comp., p. 376.



                           Subpart A--General



Sec. 59.1  Definitions.

    As used in this subchapter--
    Act means the statutes authorizing the National Flood Insurance 
Program that are incorporated in 42 U.S.C. 4001-4128.
    Actuarial rates--see risk premium rates.
    Administrator means the Federal Insurance Administrator.
    Agency means the Federal Emergency Management Agency, Washington DC.
    Alluvial fan flooding means flooding occurring on the surface of an 
alluvial fan or similar landform which originates at the apex and is 
characterized by high-velocity flows; active processes of erosion, 
sediment transport, and deposition; and, unpredictable flow paths.
    Apex means a point on an alluvial fan or similar landform below 
which the flow path of the major stream that formed the fan becomes 
unpredictable and alluvial fan flooding can occur.
    Applicant means a community which indicates a desire to participate 
in the Program.
    Appurtenant structure means a structure which is on the same parcel 
of property as the principal structure to be insured and the use of 
which is incidental to the use of the principal structure.
    Area of shallow flooding means a designated AO, AH, AR/AO, AR/AH, or 
VO zone on a community's Flood Insurance Rate Map (FIRM) with a one 
percent or greater annual chance of flooding to an average depth of one 
to three feet where a clearly defined channel does not exist, where the 
path of flooding is unpredictable, and where velocity flow may be 
evident. Such flooding is characterized by ponding or sheet flow.
    Area of special flood-related erosion hazard is the land within a 
community which is most likely to be subject to severe flood-related 
erosion losses. The area may be designated as Zone E on the Flood Hazard 
Boundary Map (FHBM). After the detailed evaluation of the special flood-
related erosion hazard area in preparation for publication of the FIRM, 
Zone E may be further refined.
    Area of special flood hazard is the land in the flood plain within a 
community subject to a one percent or greater chance of flooding in any 
given year. The area may be designated as Zone A on the FHBM. After 
detailed ratemaking has been completed in preparation for publication of 
the flood insurance rate map, Zone A usually is refined into Zones A, 
AO, AH, A1-30, AE, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, or 
V1-30, VE, or V. For purposes of these regulations, the term special 
flood hazard area (SFHA) is synonymous in meaning with the phrase area 
of special flood hazard.
    Area of special mudslide (i.e., mudflow) hazard is the land within a 
community most likely to be subject to severe mudslides (i.e., 
mudflows). The area may be designated as Zone M on the FHBM. After the 
detailed evaluation of

[[Page 221]]

the special mudslide (i.e., mudflow) hazard area in preparation for 
publication of the FIRM, Zone M may be further refined.
    Base flood means the flood having a one percent chance of being 
equalled or exceeded in any given year.
    Basement'' means any area of the building having its floor subgrade 
(below ground level) on all sides.
    Breakaway wall means a wall that is not part of the structural 
support of the building and is intended through its design and 
construction to collapse under specific lateral loading forces, without 
causing damage to the elevated portion of the building or supporting 
foundation system.
    Building--see structure.
    Chargeable rates mean the rates established by the Administrator 
pursuant to section 1308 of the Act for first layer limits of flood 
insurance on existing structures.
    Chief Executive Officer of the community (CEO) means the official of 
the community who is charged with the authority to implement and 
administer laws, ordinances and regulations for that community.
    Coastal high hazard area means an area of special flood hazard 
extending from offshore to the inland limit of a primary frontal dune 
along an open coast and any other area subject to high velocity wave 
action from storms or seismic sources.
    Community means any State or area or political subdivision thereof, 
or any Indian tribe or authorized tribal organization, or Alaska Native 
village or authorized native organization, which has authority to adopt 
and enforce flood plain management regulations for the areas within its 
jurisdiction.
    Contents coverage is the insurance on personal property within an 
enclosed structure, including the cost of debris removal, and the 
reasonable cost of removal of contents to minimize damage. Personal 
property may be household goods usual or incidental to residential 
occupancy, or merchandise, furniture, fixtures, machinery, equipment and 
supplies usual to other than residential occupancies.
    Criteria means the comprehensive criteria for land management and 
use for flood-prone areas developed under 42 U.S.C. 4102 for the 
purposes set forth in part 60 of this subchapter.
    Critical feature means an integral and readily identifiable part of 
a flood protection system, without which the flood protection provided 
by the entire system would be compromised.
    Curvilinear Line means the border on either a FHBM or FIRM that 
delineates the special flood, mudslide (i.e., mudflow) and/or flood-
related erosion hazard areas and consists of a curved or contour line 
that follows the topography.
    Deductible means the fixed amount or percentage of any loss covered 
by insurance which is borne by the insured prior to the insurer's 
liability.
    Developed area means an area of a community that is:
    (a) A primarily urbanized, built-up area that is a minimum of 20 
contiguous acres, has basic urban infrastructure, including roads, 
utilities, communications, and public facilities, to sustain industrial, 
residential, and commercial activities, and
    (1) Within which 75 percent or more of the parcels, tracts, or lots 
contain commercial, industrial, or residential structures or uses; or
    (2) Is a single parcel, tract, or lot in which 75 percent of the 
area contains existing commercial or industrial structures or uses; or
    (3) Is a subdivision developed at a density of at least two 
residential structures per acre within which 75 percent or more of the 
lots contain existing residential structures at the time the designation 
is adopted.
    (b) An undeveloped single parcel, tract, or lot of less than 20 
acres that is contiguous on at least three sides to areas meeting the 
criteria of paragraph (a) at the time the designation is adopted.
    (c) A subdivision that is a minimum of 20 contiguous acres that has 
obtained all necessary government approvals, provided that the actual 
``start of construction'' of structures has occurred on at least 10 
percent of the lots or remaining lots of a subdivision or 10 percent of 
the maximum building coverage or remaining building coverage allowed for 
a single lot subdivision at the time the designation

[[Page 222]]

is adopted and construction of structures is underway. Residential 
subdivisions must meet the density criteria in paragraph (a)(3).
    Development means any man-made change to improved or unimproved real 
estate, including but not limited to buildings or other structures, 
mining, dredging, filling, grading, paving, excavation or drilling 
operations or storage of equipment or materials..
    Director means the Director of the Federal Emergency Management 
Agency.
    Eligible community or participating community means a community for 
which the Administrator has authorized the sale of flood insurance under 
the National Flood Insurance Program.
    Elevated building means, for insurance purposes, a nonbasement 
building which has its lowest elevated floor raised above ground level 
by foundation walls, shear walls, posts, piers, pilings, or columns.
    Emergency Flood Insurance Program or emergency program means the 
Program as implemented on an emergency basis in accordance with section 
1336 of the Act. It is intended as a program to provide a first layer 
amount of insurance on all insurable structures before the effective 
date of the initial FIRM.
    Erosion means the process of the gradual wearing away of land 
masses. This peril is not per se covered under the Program.
    Exception means a waiver from the provisions of part 60 of this 
subchapter directed to a community which relieves it from the 
requirements of a rule, regulation, order or other determination made or 
issued pursuant to the Act.
    Existing construction, means for the purposes of determining rates, 
structures for which the ``start of construction'' commenced before the 
effective date of the FIRM or before January 1, 1975, for FIRMs 
effective before that date. ``Existing construction'' may also be 
referred to as ``existing structures.''
    Existing manufactured home park or subdivision means a manufactured 
home park or subdivision for which the construction of facilities for 
servicing the lots on which the manufactured homes are to be affixed 
(including, at a minimum, the installation of utilities, the 
construction of streets, and either final site grading or the pouring of 
concrete pads) is completed before the effective date of the floodplain 
management regulations adopted by a community.
    Existing structures see existing construction.
    Expansion to an existing manfactured home park or subdivision means 
the preparation of additional sites by the construction of facilities 
for servicing the lots on which the manufacturing homes are to be 
affixed (including the installation of utilities, the construction of 
streets, and either final site grading or the pouring of concrete pads).
    Federal agency means any department, agency, corporation, or other 
entity or instrumentality of the executive branch of the Federal 
Government, and includes the Federal National Mortgage Association and 
the Federal Home Loan Mortgage Corporation.
    Federal instrumentality responsible for the supervision, approval, 
regulation, or insuring of banks, savings and loan associations, or 
similar institutions means the Board of Governors of the Federal Reserve 
System, the Federal Deposit Insurance Corporation, the Comptroller of 
the Currency, the Federal Home Loan Bank Board, the Federal Savings and 
Loan Insurance Corporation, and the National Credit Union 
Administration.
    Financial assistance means any form of loan, grant, guaranty, 
insurance, payment, rebate, subsidy, disaster assistance loan or grant, 
or any other form of direct or indirect Federal assistance, other than 
general or special revenue sharing or formula grants made to States.
    Financial assistance for acquisition or construction purposes means 
any form of financial assistance which is intended in whole or in part 
for the acquisition, construction, reconstruction, repair, or 
improvement of any publicly or privately owned building or mobile home, 
and for any machinery, equipment, fixtures, and furnishings contained or 
to be contained therein, and shall include

[[Page 223]]

the purchase or subsidization of mortgages or mortgage loans but shall 
exclude assistance pursuant to the Disaster Relief Act of 1974 other 
than assistance under such Act in connection with a flood. It includes 
only financial assistance insurable under the Standard Flood Insurance 
Policy.
    First-layer coverage is the maximum amount of structural and 
contents insurance coverage available under the Emergency Program.
    Flood or Flooding means:
    (a) A general and temporary condition of partial or complete 
inundation of normally dry land areas from:
    (1) The overflow of inland or tidal waters.
    (2) The unusual and rapid accumulation or runoff of surface waters 
from any source.
    (3) Mudslides (i.e., mudflows) which are proximately caused by 
flooding as defined in paragraph (a)(2) of this definition and are akin 
to a river of liquid and flowing mud on the surfaces of normally dry 
land areas, as when earth is carried by a current of water and deposited 
along the path of the current.
    (b) The collapse or subsidence of land along the shore of a lake or 
other body of water as a result of erosion or undermining caused by 
waves or currents of water exceeding anticipated cyclical levels or 
suddenly caused by an unusually high water level in a natural body of 
water, accompanied by a severe storm, or by an unanticipated force of 
nature, such as flash flood or an abnormal tidal surge, or by some 
similarly unusual and unforeseeable event which results in flooding as 
defined in paragraph (a)(1) of this definition.
    Flood elevation determination means a determination by the 
Administrator of the water surface elevations of the base flood, that 
is, the flood level that has a one percent or greater chance of 
occurrence in any given year.
    Flood elevation study means an examination, evaluation and 
determination of flood hazards and, if appropriate, corresponding water 
surface elevations, or an examination, evaluation and determination of 
mudslide (i.e., mudflow) and/or flood-related erosion hazards.
    Flood Hazard Boundary Map (FHBM) means an official map of a 
community, issued by the Administrator, where the boundaries of the 
flood, mudslide (i.e., mudflow) related erosion areas having special 
hazards have been designated as Zones A, M, and/or E.
    Flood insurance means the insurance coverage provided under the 
Program.
    Flood Insurance Rate Map (FIRM) means an official map of a 
community, on which the Administrator has delineated both the special 
hazard areas and the risk premium zones applicable to the community.
    Flood Insurance Study see flood elevation study.
    Flood plain or flood-prone area means any land area susceptible to 
being inundated by water from any source (see definition of 
``flooding'').
    Flood plain management means the operation of an overall program of 
corrective and preventive measures for reducing flood damage, including 
but not limited to emergency preparedness plans, flood control works and 
flood plain management regulations.
    Flood plain management regulations means zoning ordinances, 
subdivision regulations, building codes, health regulations, special 
purpose ordinances (such as a flood plain ordinance, grading ordinance 
and erosion control ordinance) and other applications of police power. 
The term describes such state or local regulations, in any combination 
thereof, which provide standards for the purpose of flood damage 
prevention and reduction.
    Flood protection system means those physical structural works for 
which funds have been authorized, appropriated, and expended and which 
have been constructed specifically to modify flooding in order to reduce 
the extent of the area within a community subject to a ``special flood 
hazard'' and the extent of the depths of associated flooding. Such a 
system typically includes hurricane tidal barriers, dams, reservoirs, 
levees or dikes. These specialized flood modifying works are those 
constructed in conformance with sound engineering standards.
    Flood proofing means any combination of structural and non-
structural additions, changes, or adjustments to structures which reduce 
or eliminate

[[Page 224]]

flood damage to real estate or improved real property, water and 
sanitary facilities, structures and their contents.
    Flood-related erosion means the collapse or subsidence of land along 
the shore of a lake or other body of water as a result of undermining 
caused by waves or currents of water exceeding anticipated cyclical 
levels or suddenly caused by an unusually high water level in a natural 
body of water, accompanied by a severe storm, or by an unanticipated 
force of nature, such as a flash flood or an abnormal tidal surge, or by 
some similarly unusual and unforeseeable event which results in 
flooding.
    Flood-related erosion area or flood-related erosion prone area means 
a land area adjoining the shore of a lake or other body of water, which 
due to the composition of the shoreline or bank and high water levels or 
wind-driven currents, is likely to suffer flood-related erosion damage.
    Flood-related erosion area management means the operation of an 
overall program of corrective and preventive measures for reducing 
flood-related erosion damage, including but not limited to emergency 
preparedness plans, flood-related erosion control works, and flood plain 
management regulations.
    Floodway-- see regulatory floodway.
    Floodway encroachment lines mean the lines marking the limits of 
floodways on Federal, State and local flood plain maps.
    Freeboard means a factor of safety usually expressed in feet above a 
flood level for purposes of flood plain management. ``Freeboard'' tends 
to compensate for the many unknown factors that could contribute to 
flood heights greater than the height calculated for a selected size 
flood and floodway conditions, such as wave action, bridge openings, and 
the hydrological effect of urbanization of the watershed.
    Functionally dependent use means a use which cannot perform its 
intended purpose unless it is located or carried out in close proximity 
to water. The term includes only docking facilities, port facilities 
that are necessary for the loading and unloading of cargo or passengers, 
and ship building and ship repair facilities, but does not include long-
term storage or related manufacturing facilities.
    General Counsel means the General Counsel of the Federal Emergency 
Management Agency.
    Highest adjacent grade means the highest natural elevation of the 
ground surface prior to construction next to the proposed walls of a 
structure.
    Historic Structure means any structure that is:
    (a) Listed individually in the National Register of Historic Places 
(a listing maintained by the Department of Interior) or preliminarily 
determined by the Secretary of the Interior as meeting the requirements 
for individual listing on the National Register;
    (b) Certified or preliminarily determined by the Secretary of the 
Interior as contributing to the historical significance of a registered 
historic district or a district preliminarily determined by the 
Secretary to qualify as a registered historic district;
    (c) Individually listed on a state inventory of historic places in 
states with historic preservation programs which have been approved by 
the Secretary of the Interior; or
    (d) Individually listed on a local inventory of historic places in 
communities with historic preservation programs that have been certified 
either:
    (1) By an approved state program as determined by the Secretary of 
the Interior or
    (2) Directly by the Secretary of the Interior in states without 
approved programs.
    Independent scientific body means a non-federal technical or 
scientific organization involved in the study of land use planning, 
flood plain management, hydrology, geology, geography, or any other 
related field of study concerned with flooding.
    Insurance adjustment organization means any organization or person 
engaged in the business of adjusting loss claims arising under the 
Standard Flood Insurance Policy.
    Insurance company or insurer means any person or organization 
authorized to engage in the insurance business under the laws of any 
State.

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    Levee means a man-made structure, usually an earthen embankment, 
designed and constructed in accordance with sound engineering practices 
to contain, control, or divert the flow of water so as to provide 
protection from temporary flooding.
    Levee System means a flood protection system which consists of a 
levee, or levees, and associated structures, such as closure and 
drainage devices, which are constructed and operated in accordance with 
sound engineering practices.
    Lowest Floor means the lowest floor of the lowest enclosed area 
(including basement). An unfinished or flood resistant enclosure, usable 
solely for parking of vehicles, building access or storage in an area 
other than a basement area is not considered a building's lowest floor; 
Provided, that such enclosure is not built so as to render the structure 
in violation of the applicable non-elevation design requirements of 
Sec. 60.3.
    Mangrove stand means an assemblage of mangrove trees which are 
mostly low trees noted for a copious development of interlacing 
adventitious roots above the ground and which contain one or more of the 
following species: Black mangrove (Avicennia Nitida); red mangrove 
(Rhizophora Mangle); white mangrove (Languncularia Racemosa); and 
buttonwood (Conocarpus Erecta).
    Manufactured home means a structure, transportable in one or more 
sections, which is built on a permanent chassis and is designed for use 
with or without a permanent foundation when attached to the required 
utilities. The term ``manufactured home'' does not include a 
``recreational vehicle''.
    Manufactured home park or subdivision'' means a parcel (or 
contiguous parcels) of land divided into two or more manufactured home 
lots for rent or sale.
    Map means the Flood Hazard Boundary Map (FHBM) or the Flood 
Insurance Rate Map (FIRM) for a community issued by the Agency.
    Mean sea level means, for purposes of the National Flood Insurance 
Program, the National Geodetic Vertical Datum (NGVD) of 1929 or other 
datum, to which base flood elevations shown on a community's Flood 
Insurance Rate Map are referenced.
    Mudslide(i.e., mudflow) describes a condition where there is a 
river, flow or inundation of liquid mud down a hillside usually as a 
result of a dual condition of loss of brush cover, and the subsequent 
accumulation of water on the ground preceded by a period of unusually 
heavy or sustained rain. A mudslide (i.e., mudflow) may occur as a 
distinct phenomenon while a landslide is in progress, and will be 
recognized as such by the Administrator only if the mudflow, and not the 
landslide, is the proximate cause of damage that occurs.
    Mudslide (i.e., mudflow) area management means the operation of an 
overall program of corrective and preventive measures for reducing 
mudslide (i.e., mudflow) damage, including but not limited to emergency 
preparedness plans, mudslide control works, and flood plain management 
regulations.
    Mudslide (i.e., mudflow) prone area means an area with land surfaces 
and slopes of unconsolidated material where the history, geology and 
climate indicate a potential for mudflow.
    New construction means, for the purposes of determining insurance 
rates, structures for which the ``start of construction'' commenced on 
or after the effective date of an initial FIRM or after December 31, 
1974, whichever is later, and includes any subsequent improvements to 
such structures. For floodplain management purposes, new construction 
means structures for which the start of construction commenced on or 
after the effective date of a floodplain management regulation adopted 
by a community and includes any subsequent improvements to such 
structures.
    New manufactured home park or subdivision means a manufactured home 
park or subdivision for which the construciton of facilities for 
servicing the lots on which the manufactured homes are to be affixed 
(including at a minimum, the installation of utilities, the construction 
of streets, and either final site grading or the pouring of concrete 
pads) is completed on or after the effective date of floodplain 
management regulations adopted by a community.

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    100-year flood see base flood.
    Participating community, also known as an eligible community, means 
a community in which the Administrator has authorized the sale of flood 
insurance.
    Person includes any individual or group of individuals, corporation, 
partnership, association, or any other entity, including State and local 
governments and agencies.
    Policy means the Standard Flood Insurance Policy.
    Premium means the total premium payable by the insured for the 
coverage or coverages provided under the policy. The calculation of the 
premium may be based upon either chargeable rates or risk premium rates, 
or a combination of both.
    Primary frontal dune means a continuous or nearly continuous mound 
or ridge of sand with relatively steep seaward and landward slopes 
immediately landward and adjacent to the beach and subject to erosion 
and overtopping from high tides and waves during major coastal storms. 
The inland limit of the primary frontal dune occurs at the point where 
there is a distinct change from a relatively steep slope to a relatively 
mild slope.
    Principally above ground means that at least 51 percent of the 
actual cash value of the structure, less land value, is above ground.
    Program means the National Flood Insurance Program authorized by 42 
U.S.C. 4001 through 4128.
    Program deficiency means a defect in a community's flood plain 
management regulations or administrative procedures that impairs 
effective implementation of those flood plain management regulations or 
of the standards in Secs. 60.3, 60.4, 60.5, or 60.6.
    Project cost means the total financial cost of a flood protection 
system (including design, land acquisition, construction, fees, 
overhead, and profits), unless the Federal Insurance Administrator 
determines a given ``cost'' not to be a part of such project cost.
    Recreational vehicle means a vehicle which is:
    (a) Built on a single chassis;
    (b) 400 square feet or less when measured at the largest horizontal 
projection;
    (c) Designed to be self-propelled or permanently towable by a light 
duty truck; and
    (d) Designed primarily not for use as a permanent dwelling but as 
temporary living quarters for recreational, camping, travel, or seasonal 
use.
    Reference feature is the receding edge of a bluff or eroding frontal 
dune, or if such a feature is not present, the normal high-water line or 
the seaward line of permanent vegetation if a high-water line cannot be 
identified.
    Regular Program means the Program authorized by the Act under which 
risk premium rates are required for the first half of available coverage 
(also known as ``first layer'' coverage) for all new construction and 
substantial improvements started on or after the effective date of the 
FIRM, or after December 31, 1974, for FIRM's effective on or before that 
date. All buildings, the construction of which started before the 
effective date of the FIRM, or before January 1, 1975, for FIRMs 
effective before that date, are eligible for first layer coverage at 
either subsidized rates or risk premium rates, whichever are lower. 
Regardless of date of construction, risk premium rates are always 
required for the second layer coverage and such coverage is offered only 
after the Administrator has completed a risk study for the community.
    Regulatory floodway means the channel of a river or other 
watercourse and the adjacent land areas that must be reserved in order 
to discharge the base flood without cumulatively increasing the water 
surface elevation more than a designated height.
    Remedy a violation means to bring the structure or other development 
into compliance with State or local flood plain management regulations, 
or, if this is not possible, to reduce the impacts of its noncompliance. 
Ways that impacts may be reduced include protecting the structure or 
other affected development from flood damages, implementing the 
enforcement provisions of the ordinance or otherwise deterring future 
similar violations, or reducing Federal financial exposure with regard 
to the structure or other development.
    Risk premium rates mean those rates established by the Administrator 
pursuant to individual community studies

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and investigations which are undertaken to provide flood insurance in 
accordance with section 1307 of the Act and the accepted actuarial 
principles. ``Risk premium rates'' include provisions for operating 
costs and allowances.
    Riverine means relating to, formed by, or resembling a river 
(including tributaries), stream, brook, etc.
    Sand dunes mean naturally occurring accumulations of sand in ridges 
or mounds landward of the beach.
    Scientifically incorrect. The methodology(ies) and/or assumptions 
which have been utilized are inappropriate for the physical processes 
being evaluated or are otherwise erroneous.
    Second layer coverage means an additional limit of coverage equal to 
the amounts made available under the Emergency Program, and made 
available under the Regular Program.
    Servicing company means a corporation, partnership, association, or 
any other organized entity which contracts with the Federal Insurance 
Administration to service insurance policies under the National Flood 
Insurance Program for a particular area.
    Sheet flow area-- see area of shallow flooding.
    60-year setback means a distance equal to 60 times the average 
annual long term recession rate at a site, measured from the reference 
feature.
    Special flood hazard area-- see ``area of special flood hazard''.
    Special hazard area means an area having special flood, mudslide 
(i.e., mudflow), or flood-related erosion hazards, and shown on a Flood 
Hazard Boundary Map or Flood Insurance Rate Map as Zone A, AO, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, AH, VO, V1-30, VE, V, 
M, or E.
    Standard Flood Insurance Policy means the flood insurance policy 
issued by the Federal Insurance Administrator, or an insurer pursuant to 
an arrangement with the Administrator pursuant to Federal statutes and 
regulations.
    Start of Construction (for other than new construction or 
substantial improvements under the Coastal Barrier Resources Act (Pub. 
L. 97-348)), includes substantial improvement, and means the date the 
building permit was issued, provided the actual start of construction, 
repair, reconstruction, rehabilitation, addition placement, or other 
improvement was within 180 days of the permit date. The actual start 
means either the first placement of permanent construction of a 
structure on a site, such as the pouring of slab or footings, the 
installation of piles, the construction of columns, or any work beyond 
the stage of excavation; or the placement of a manufactured home on a 
foundation. Permanent construction does not include land preparation, 
such as clearing, grading and filling; nor does it include the 
installation of streets and/or walkways; nor does it include excavation 
for a basement, footings, piers, or foundations or the erection of 
temporary forms; nor does it include the installation on the property of 
accessory buildings, such as garages or sheds not occupied as dwelling 
units or not part of the main structure. For a substantial improvement, 
the actual start of construction means the first alteration of any wall, 
ceiling, floor, or other structural part of a building, whether or not 
that alteration affects the external dimensions of the building.
    State means any State, the District of Columbia, the territories and 
possessions of the United States, the Commonwealth of Puerto Rico, and 
the Trust Territory of the Pacific Islands.
    State coordinating agency means the agency of the state government, 
or other office designated by the Governor of the state or by state 
statute at the request of the Administrator to assist in the 
implementation of the National Flood Insurance Program in that state.
    Storm cellar means a space below grade used to accommodate occupants 
of the structure and emergency supplies as a means of temporary shelter 
against severe tornado or similar wind storm activity.
    Structure means, for flood plain management purposes, a walled and 
roofed building, including a gas or liquid storage tank, that is 
principally above ground, as well as a manufactured home. ``Structure'' 
for insurance coverage purposes, means a walled and roofed building, 
other than a gas or liquid storage tank, that is principally

[[Page 228]]

above ground and affixed to a permanent site, as well as a manufactured 
home on a permanent foundation. For the latter purpose, the term 
includes a building while in the course of construction, alteration or 
repair, but does not include building materials or supplies intended for 
use in such construction, alteration or repair, unless such materials or 
supplies are within an enclosed building on the premises.
    Subsidized rates mean the rates established by the Administrator 
involving in the aggregate a subsidization by the Federal Government.
    Substantial damage means damage of any origin sustained by a 
structure whereby the cost of restoring the structure to its before 
damaged condition would equal or exceed 50 percent of the market value 
of the structure before the damage occurred.
    Substantial improvement means any reconstruction, rehabilitation, 
addition, or other improvement of a structure, the cost of which equals 
or exceeds 50 percent of the market value of the structure before the 
``start of construction'' of the improvement. This term includes 
structures which have incurred ``substantial damage'', regardless of the 
actual repair work performed. The term does not, however, include 
either:
    (1) Any project for improvement of a structure to correct existing 
violations of state or local health, sanitary, or safety code 
specifications which have been identified by the local code enforcement 
official and which are the minimum necessary to assure safe living 
conditions or
    (2) Any alteration of a ``historic structure'', provided that the 
alteration will not preclude the structure's continued designation as a 
``historic structure''.
    30-year setback means a distance equal to 30 times the average 
annual long term recession rate at a site, measured from the reference 
feature.
    Technically incorrect. The methodology(ies) utilized has been 
erroneously applied due to mathematical or measurement error, changed 
physical conditions, or insufficient quantity or quality of input data.
    V Zone--see ``coastal high hazard area.''
    Variance means a grant of relief by a community from the terms of a 
flood plain management regulation.
    Violation means the failure of a structure or other development to 
be fully compliant with the community's flood plain management 
regulations. A structure or other development without the elevation 
certificate, other certifications, or other evidence of compliance 
required in Sec. 60.3(b)(5), (c)(4), (c)(10), (d)(3), (e)(2), (e)(4), or 
(e)(5) is presumed to be in violation until such time as that 
documentation is provided.
    Water surface elevation means the height, in relation to the 
National Geodetic Vertical Datum (NGVD) of 1929, (or other datum, where 
specified) of floods of various magnitudes and frequencies in the flood 
plains of coastal or riverine areas.
    Zone of imminent collapse means an area subject to erosion adjacent 
to the shoreline of an ocean, bay, or lake and within a distance equal 
to 10 feet plus 5 times the average annual long-term erosion rate for 
the site, measured from the reference feature.

[41 FR 46968, Oct. 26, 1976]

    Editorial Note: For Federal Register citations affecting Sec. 59.1, 
see the List of Sections Affected in the Finding Aids section of this 
volume.



Sec. 59.2  Description of program.

    (a) The National Flood Insurance Act of 1968 was enacted by title 
XIII of the Housing and Urban Development Act of 1968 (Pub. L. 90-448, 
August 1, 1968) to provide previously unavailable flood insurance 
protection to property owners in flood-prone areas. Mudslide (as defined 
in Sec. 59.1) protection was added to the Program by the Housing and 
Urban Development Act of 1969 (Pub. L. 91-152, December 24, 1969). 
Flood-related erosion (as defined in Sec. 59.1) protection was added to 
the Program by the Flood Disaster Protection Act of 1973 (Pub. L. 93-
234, December 31, 1973). The Flood Disaster Protection Act of 1973 
requires the purchase of flood insurance on and after March 2, 1974, as 
a condition of receiving any form of Federal or federally-related 
financial assistance for acquisition or construction purposes with 
respect to insurable buildings and mobile homes within an

[[Page 229]]

identified special flood, mudslide (i.e., mudflow), or flood-related 
erosion hazard area that is located within any community participating 
in the Program. The Act also requires that on and after July 1, 1975, or 
one year after a community has been formally notified by the 
Administrator of its identification as community containing one or more 
special flood, mudslide (i.e., mudflow), or flood-related erosion hazard 
areas, no such Federal financial assistance, shall be provided within 
such an area unless the community in which the area is located is then 
participating in the Program, subject to certain exceptions. See FIA 
published Guidelines at Sec. 59.4(c).
    (b) To qualify for the sale of federally-subsidized flood insurance 
a community must adopt and submit to the Administrator as part of its 
application, flood plain management regulations, satisfying at a minimum 
the criteria set forth at part 60 of this subchapter, designed to reduce 
or avoid future flood, mudslide (i.e., mudflow) or flood-related erosion 
damages. These regulations must include effective enforcement 
provisions.
    (c) Minimum requirements for adequate flood plain management 
regulations are set forth in Sec. 60.3 for flood-prone areas, in 
Sec. 60.4 for mudslide (i.e., mudflow) areas and in Sec. 60.5 for flood-
related erosion areas. Those applicable requirements and standards are 
based on the amount of technical information available to the community.

[41 FR 46968, Oct. 26, 1976, as amended at 43 FR 7140, Feb. 17, 1978. 
Redesignated at 44 FR 31177, May 31, 1979, and amended at 48 FR 44552, 
Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 59.3  Emergency program.

    The 1968 Act required a risk study to be undertaken for each 
community before it could become eligible for the sale of flood 
insurance. Since this requirement resulted in a delay in providing 
insurance, the Congress, in section 408 of the Housing and Urban 
Development Act of 1969 (Pub. L. 91-152, December 24, 1969), established 
an Emergency Flood Insurance Program as a new section 1336 of the 
National Flood Insurance Act (42 U.S.C. 4056) to permit the early sale 
of insurance in flood-prone communities. The emergency program does not 
affect the requirement that a community must adopt adequate flood plain 
management regulations pursuant to part 60 of this subchapter but 
permits insurance to be sold before a study is conducted to determine 
risk premium rates for the community. The program still requires upon 
the effective date of a FIRM the charging of risk premium rates for all 
new construction and substantial improvements and for higher limits of 
coverage for existing structures.

[43 FR 7140, Feb. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
and amended at 48 FR 44543, Sept. 29, 1983]



Sec. 59.4  References.

    (a) The following are statutory references for the National Flood 
Insurance Program, under which these regulations are issued:
    (1) National Flood Insurance Act of 1968 (title XIII of the Housing 
and Urban Development Act of 1968), Pub. L. 90-448, approved August 1, 
1968, 42 U.S.C. 4001 et seq.
    (2) Housing and Urban Development Act of 1969 (Pub. L. 91-152, 
approved December 24, 1969).
    (3) Flood Disaster Protection Act of 1973 (87 Stat. 980), Public Law 
93-234, approved December 31, 1973.
    (4) Section 816 of the Housing and Community Development Act of 1974 
(87 Stat. 975), Public Law 93-383, approved August 22, 1974.
    (5) Public Law 5-128 (effective October 12, 1977).
    (6) The above statutes are included in 42 U.S.C. 4001 et seq.
    (b) The following are references relevant to the National Flood 
Insurance Program:
    (1) Executive Order 11988 (Floodplain Management, dated May 24, 1977 
(42 FR 26951, May 25, 1977)).
    (2) The Flood Control Act of 1960 (Pub. L. 86-645).
    (3) Title II, section 314 of title III and section 406 of title IV 
of the Disaster Relief Act of 1974 (Pub. L. 93-288).
    (4) Coastal Zone Management Act (Pub. L. 92-583), as amended Public 
Law 94-370.
    (5) Water Resources Planning Act (Pub. L. 89-90), as amended Public 
Law 94-112 (October 16, 1975).

[[Page 230]]

    (6) Title I, National Environmental Policy Act (Pub. L. 91-190).
    (7) Land and Water Conservation Fund Act (Pub. L. 89-578), and 
subsequent amendments thereto.
    (8) Water Resources Council, Principals and Standards for Planning, 
Water and Related Land Resources (38 FR 24778-24869, September 10, 
1973).
    (9) Executive Order 11593 (Protection and Enchancement of the 
Cultural Environment), dated May 13, 1971 (36 FR 8921, May 15, 1971).
    (10) 89th Cong., 2nd Session, H.D. 465.
    (11) Required land use element for comprehensive planning assistance 
under section 701 of the Housing Act of 1954, as amended by the Housing 
and Community Development Act of 1974 (24 CFR 600.72).
    (12) Executive Order 11990 (Protection of Wetlands, dated May 24, 
1977 (42 FR 26951, May 25, 1977)).
    (13) Water Resources Council (Guidance for Floodplain Management) 
(42 FR 52590, September 30, 1977).
    (14) Unified National Program for Floodplain Management of the 
United States Water Resources Council, July 1976.
    (c) The following reference guidelines represent the views of the 
Federal Insurance Administration with respect to the mandatory purchase 
of flood insurance under section 102 of the Flood Disaster Protection 
Act of 1973: Mandatory Purchase of Flood Insurance Guidelines (54 FR 
29666-29695, July 13, 1989).

[41 FR 46968, Oct. 26, 1976, as amended at 43 FR 7140, Feb. 17, 1978. 
Redesignated at 44 FR 31177, May 31, 1979, and amended at 57 FR 19540, 
May 7, 1992]



                   Subpart B--Eligibility Requirements



Sec. 59.21  Purpose of subpart.

    This subpart lists actions that must be taken by a community to 
become eligible and to remain eligible for the Program.

[41 FR 46968, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 59.22  Prerequisites for the sale of flood insurance.

    (a) To qualify for flood insurance availability a community shall 
apply for the entire area within its jurisdiction, and shall submit:
    (1) Copies of legislative and executive actions indicating a local 
need for flood insurance and an explicit desire to participate in the 
National Flood Insurance Program;
    (2) Citations to State and local statutes and ordinances authorizing 
actions regulating land use and copies of the local laws and regulations 
cited;
    (3) A copy of the flood plain management regulations the community 
has adopted to meet the requirements of Secs. 60.3, 60.4 and/or 
Sec. 60.5 of this subchapter. This submission shall include copies of 
any zoning, building, and subdivision regulations, health codes, special 
purpose ordinances (such as a flood plain ordinance, grading ordinance, 
or flood-related erosion control ordinance), and any other corrective 
and preventive measures enacted to reduce or prevent flood, mudslide 
(i.e., mudflow) or flood-related erosion damage;
    (4) A list of the incorporated communities within the applicant's 
boundaries;
    (5) Estimates relating to the community as a whole and to the flood, 
mudslide (i.e., mudflow) and flood-related erosion prone areas 
concerning:
    (i) Population;
    (ii) Number of one to four family residences;
    (iii) Number of small businesses; and
    (iv) Number of all other structures.
    (6) Address of a local repository, such as a municipal building, 
where the Flood Hazard Boundary Maps (FHBM's) and Flood Insurance Rate 
Maps (FIRM's) will be made available for public inspection;
    (7) A summary of any State or Federal activities with respect to 
flood plain, mudslide (i.e., mudflow) or flood-related erosion area 
management within the community, such as federally-funded flood control 
projects and State-administered flood plain management regulations;
    (8) A commitment to recognize and duly evaluate flood, mudslide 
(i.e., mudflow) and/or flood-related erosion hazards in all official 
actions in the areas having special flood, mudslide (i.e., mudflow) and/
or flood-related erosion hazards and to take such other official action 
reasonably necessary to

[[Page 231]]

carry out the objectives of the program; and
    (9) A commitment to:
    (i) Assist the Administrator at his/her request, in his/her 
delineation of the limits of the areas having special flood, mudslide 
(i.e., mudflow) or flood-related erosion hazards;
    (ii) Provide such information concerning present uses and occupancy 
of the flood plain, mudslide (i.e., mudflow) or flood-related erosion 
areas as the Administrator may request;
    (iii) Maintain for public inspection and furnish upon request, for 
the determination of applicable flood insurance risk premium rates 
within all areas having special flood hazards identified on a FHBM or 
FIRM, any certificates of floodproofing, and information on the 
elevation (in relation to mean sea level) of the level of the lowest 
floor (including basement) of all new or substantially improved 
structures, and include whether or not such structures contain a 
basement, and if the structure has been floodproofed, the elevation (in 
relation to mean sea level) to which the structure was floodproofed;
    (iv) Cooperate with Federal, State, and local agencies and private 
firms which undertake to study, survey, map, and identify flood plain, 
mudslide (i.e., mudflow) or flood-related erosion areas, and cooperate 
with neighboring communities with respect to the management of adjoining 
flood plain, mudslide (i.e., mudflow) and/or flood-related erosion areas 
in order to prevent aggravation of existing hazards;
    (v) Upon occurrence, notify the Administrator in writing whenever 
the boundaries of the community have been modified by annexation or the 
community has otherwise assumed or no longer has authority to adopt and 
enforce flood plain management regulations for a particular area. In 
order that all FHBM's and FIRM's accurately represent the community's 
bound aries, include within such notification a copy of a map of the 
community suitable for reproduction, clearly delineating the new 
corporate limits or new area for which the community has assumed or 
relinquished flood plain management regulatory authority.
    (b) An applicant shall legislatively:
    (1) Appoint or designate the agency or official with the 
responsibility, authority, and means to implement the commitments made 
in paragraph (a) of this section, and
    (2) Designate the official responsible to submit a report to the 
Administrator concerning the community participation in the Program, 
including, but not limited to the development and implementation of 
flood plain management regulations. This report shall be submitted 
annually or biennially as determined by the Administrator.
    (c) The documents required by paragraph (a) of this section and 
evidence of the actions required by paragraph (b) of this section shall 
be submitted to the Federal Emergency Management Agency, Washington DC 
20472.

[41 FR 46968, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979 
and amended at 48 FR 29318, June 24, 1983; 48 FR 44543 and 44552, Sept. 
29, 1983; 49 FR 4751, Feb. 8, 1984; 49 FR 33656, Aug. 24, 1984; 50 FR 
36023, Sept. 4, 1985]



Sec. 59.23  Priorities for the sale of flood insurance under the regular program.

    Flood-prone, mudslide (i.e., mudflow) and flood-related erosion 
prone communities are placed on a register of areas eligible for 
ratemaking studies and then selected from this register for ratemaking 
studies on the basis of the following considerations--
    (a) Recommendations of State officials;
    (b) Location of community and urgency of need for flood insurance;
    (c) Population of community and intensity of existing or proposed 
development of the flood plain, the mudslide (i.e., mudflow) and the 
flood-related erosion area;
    (d) Availability of information on the community with respect to its 
flood, mudslide (i.e., mudflow) and flood-related erosion 
characteristics and previous losses;
    (e) Extent of State and local progress in flood plain, mudslide 
(i.e., mudflow) area and flood-related erosion area management, 
including adoption of flood plain management regulations consistent with 
related ongoing programs in the area.

[41 FR 46968, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]

[[Page 232]]



Sec. 59.24  Suspension of community eligibility.

    (a) A community eligible for the sale of flood insurance shall be 
subject to suspension from the Program for failing to submit copies of 
adequate floodplain management regulations meeting the minimum 
requirements of paragraphs (b), (c), (d), (e) or (f) of Sec. 60.3 or 
paragraph (b) of Sec. 60.4 or Sec. 60.5, within six months from the date 
the Director provides the data upon which the flood plain regulations 
for the applicable paragraph shall be based. Where there has not been 
any submission by the community, the Director shall notify the community 
that 90 days remain in the six month period in order to submit adequate 
flood plain management regulations. Where there has been an inadequate 
submission, the Director shall notify the community of the specific 
deficiencies in its submitted flood plain management regulations and 
inform the community of the amount of time remaining within the six 
month period. If, subsequently, copies of adequate flood plain 
management regulations are not received by the Director, he shall, no 
later than 30 days before the expiration of the original six month 
period, provide written notice to the community and to the state and 
assure publication in the Federal Register under part 64 of this 
subchapter, of the community's loss of eligibility for the sale of flood 
insurance, such suspension to become effective upon the expiration of 
the six month period. Should the community remedy the defect and the 
Director receive copies of adequate flood plain management regulations 
within the notice period, the suspension notice shall be rescinded by 
the Director. If the Director receives notice from the State that it has 
enacted adequate flood plain management regulations for the community 
within the notice period, the suspension notice shall be rescinded by 
the Director. The community's eligibility shall remain terminated after 
suspension until copies of adequate flood plain management regulations 
have been received and approved by the Director.
    (b) A community eligible for the sale of flood insurance which fails 
to adequately enforce flood plain management regulations meeting the 
minimum requirements set forth in Secs. 60.3, 60.4 and/or 60.5 shall be 
subject to probation. Probation shall represent formal notification to 
the community that the Administrator regards the community's flood plain 
management program as not compliant with NFIP criteria. Prior to 
imposing probation, the Administrator (1) shall inform the community 
upon 90 days prior written notice of the impending probation and of the 
specific program deficiencies and violations relative to the failure to 
enforce, (2) shall, at least 60 days before probation is to begin, issue 
a press release to local media explaining the reasons for and the 
effects of probation, and (3) shall, at least 90 days before probation 
is to begin, advise all policyholders in the community of the impending 
probation and the additional premium that will be charged, as provided 
in this paragraph, on policies sold or renewed during the period of 
probation. During this 90-day period the community shall have the 
opportunity to avoid probation by demonstrating compliance with Program 
requirements, or by correcting Program deficiencies and remedying all 
violations to the maximum extent possible. If, at the end of the 90-day 
period, the Administrator determines that the community has failed to do 
so, the probation shall go into effect. Probation may be continued for 
up to one year after the community corrects all Program deficiencies and 
remedies all violations to the maximum extent possible. Flood insurance 
may be sold or renewed in the community while it is on probation. Where 
a policy covers property located in a community placed on probation on 
or after October 1, 1986, but prior to October 1, 1992, an additional 
premium of $25.00 shall be charged on each such policy newly issued or 
renewed during the one-year period beginning on the date the community 
is placed on probation and during any successive one-year periods that 
begin prior to October 1, 1992. Where a community's probation begins on 
or after October 1, 1992, the additional premium described in the 
preceding sentence shall be $50.00, which shall also be charged during 
any successive one-year periods during which the community remains on 
probation

[[Page 233]]

for any part thereof. This $50.00 additional premium shall further be 
charged during any successive one-year periods that begin on or after 
October 1, 1992, where the preceding one-year probation period began 
prior to October 1, 1992.
    (c) A community eligible for the sale of flood insurance which fails 
to adequately enforce its flood plain management regulations meeting the 
minimum requirements set forth in Secs. 60.3, 60.4 and/or 60.5 and does 
not correct its Program deficiencies and remedy all violations to the 
maximum extent possible in accordance with compliance deadlines 
established during a period of probation shall be subject to suspension 
of its Program eligibility. Under such circumstances, the Administrator 
shall grant the community 30 days in which to show cause why it should 
not be suspended. The Administrator may conduct a hearing, written or 
oral, before commencing suspensive action. If a community is to be 
suspended, the Administrator shall inform it upon 30 days prior written 
notice and upon publication in the Federal Register under part 64 of 
this subchapter of its loss of eligibility for the sale of flood 
insurance. In the event of impending suspension, the Administrator shall 
issue a press release to the local media explaining the reasons and 
effects of the suspension. The community's eligibility shall only be 
reinstated by the Administrator upon his receipt of a local legislative 
or executive measure reaffirming the community's formal intent to 
adequately enforce the flood plain management requirements of this 
subpart, together with evidence of action taken by the community to 
correct Program deficiencies and remedy to the maximum extent possible 
those violations which caused the suspension. In certain cases, the 
Administrator, in order to evaluate the community's performance under 
the terms of its submission, may withhold reinstatement for a period not 
to exceed one year from the date of his receipt of the satisfactory 
submission or place the community on probation as provided for in 
paragraph (b) of this section.
    (d) A community eligible for the sale of flood insurance which 
repeals its flood plain management regulations, allows its regulations 
to lapse, or amends its regulations so that they no longer meet the 
minimum requirements set forth in Secs. 60.3, 60.4 and/or 60.5 shall be 
suspended from the Program. If a community is to be suspended, the 
Administrator shall inform it upon 30 days prior written notice and upon 
publication in the Federal Register under part 64 of this subchapter of 
its loss of eligibility for the sale of flood insurance. The community 
eligibility shall remain terminated after suspension until copies of 
adequate flood plain management regulations have been received and 
approved by the Administrator.
    (e) A community eligible for the sale of flood insurance may 
withdraw from the Program by submitting to the Administrator a copy of a 
legislative action that explicitly states its desire to withdraw from 
the National Flood Insurance Program. Upon receipt of a certified copy 
of a final legislative action, the Administrator shall withdraw the 
community from the Program and publish in the Federal Register under 
part 64 of this subchapter its loss of eligibility for the sale of flood 
insurance. A community that has withdrawn from the Program may be 
reinstated if its submits the application materials specified in 
Sec. 59.22(a).
    (f) If during a period of ineligibility under paragraphs (a), (d), 
or (e) of this section, a community has permitted actions to take place 
that have aggravated existing flood plain, mudslide (i.e., mudflow) and/
or flood related erosion hazards, the Administrator may withhold 
reinstatement until the community submits evidence that it has taken 
action to remedy to the maximum extent possible the increased hazards. 
The Administrator may also place the reinstated community on probation 
as provided for in paragraph (b) of this section.
    (g) The Administrator shall promptly notify the servicing company 
and any insurers issuing flood insurance pursuant to an arrangement with 
the Administrator of those communities whose eligibility has been 
suspended or which have withdrawn from the program. Flood insurance 
shall not be sold

[[Page 234]]

or renewed in those communities. Policies sold or renewed within a 
community during a period of ineligibility are deemed to be voidable by 
the Administrator whether or not the parties to sale or renewal had 
actual notice of the ineligibility.

[41 FR 46968, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
and amended at 48 FR 44543 and 44552, Sept. 29, 1983; 49 FR 4751, Feb. 
8, 1984; 50 FR 36023, Sept. 4, 1985; 57 FR 19540, May 7, 1992; 59 FR 
53598, Oct. 25, 1994]



PART 60--CRITERIA FOR LAND MANAGEMENT AND USE--Table of Contents




     Subpart A--Requirements for Flood Plain Management Regulations

Sec.
60.1  Purpose of subpart.
60.2  Minimum compliance with flood plain management criteria.
60.3  Flood plain management criteria for flood-prone areas.
60.4  Flood plain management criteria for mudslide (i.e., mudflow) -
          prone areas.
60.5  Flood plain management criteria for flood-related erosion-prone 
          areas.
60.6  Variances and exceptions.
60.7  Revisions of criteria for flood plain management regulations.
60.8  Definitions.

  Subpart B--Requirements for State Flood Plain Management Regulations

60.11  Purpose of this subpart.
60.12  Flood plain management criteria for State-owned properties in 
          special hazard areas.
60.13  Noncompliance.

 Subpart C--Additional Considerations in Managing Flood-Prone, Mudslide 
      (i.e., Mudflow)-Prone, and Flood-Related Erosion-Prone Areas

60.21  Purpose of this subpart.
60.22  Planning considerations for flood-prone areas.
60.23  Planning considerations for mudslide (i.e., mudflow)-prone areas.
60.24  Planning considerations for flood-related erosion-prone areas.
60.25  Designation, duties, and responsibilities of State Coordinating 
          Agencies.
60.26  Local coordination.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 376.

    Source: 41 FR 46975, Oct. 26, 1976, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.



     Subpart A--Requirements for Flood Plain Management Regulations



Sec. 60.1  Purpose of subpart.

    (a) The Act provides that flood insurance shall not be sold or 
renewed under the program within a community, unless the community has 
adopted adequate flood plain management regulations consistent with 
Federal criteria. Responsibility for establishing such criteria is 
delegated to the Administrator.
    (b) This subpart sets forth the criteria developed in accordance 
with the Act by which the Administrator will determine the adequacy of a 
community's flood plain management regulations. These regulations must 
be legally-enforceable, applied uniformly throughout the community to 
all privately and publicly owned land within flood-prone, mudslide 
(i.e., mudflow) or flood-related erosion areas, and the community must 
provide that the regulations take precedence over any less restrictive 
conflicting local laws, ordinances or codes. Except as otherwise 
provided in Sec. 60.6, the adequacy of such regulations shall be 
determined on the basis of the standards set forth in Sec. 60.3 for 
flood-prone areas, Sec. 60.4 for mudslide areas and Sec. 60.5 for flood-
related erosion areas.
    (c) Nothing in this subpart shall be construed as modifying or 
replacing the general requirement that all eligible communities must 
take into account flood, mudslide (i.e., mudflow) and flood-related 
erosion hazards, to the extent that they are known, in all official 
actions relating to land management and use.
    (d) The criteria set forth in this subpart are minimum standards for 
the adoption of flood plain management regulations by flood-prone, 
mudslide (i.e., mudflow)-prone and flood-related erosion-prone 
communities. Any community may exceed the minimum criteria under this 
part by adopting more comprehensive flood plain management regulations 
utilizing the standards such as contained in subpart C of this

[[Page 235]]

part. In some instances, community officials may have access to 
information or knowledge of conditions that require, particularly for 
human safety, higher standards than the minimum criteria set forth in 
subpart A of this part. Therefore, any flood plain management 
regulations adopted by a State or a community which are more restrictive 
than the criteria set forth in this part are encouraged and shall take 
precedence.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 60.2  Minimum compliance with flood plain management criteria.

    (a) A flood-prone community applying for flood insurance eligibility 
shall meet the standards of Sec. 60.3(a) in order to become eligible if 
a FHBM has not been issued for the community at the time of application. 
Thereafter, the community will be given a period of six months from the 
date the Director provides the data set forth in Sec. 60.3 (b), (c), 
(d), (e) or (f), in which to meet the requirements of the applicable 
paragraph. If a community has received a FHBM, but has not yet applied 
for Program eligibility, the community shall apply for eligibility 
directly under the standards set forth in Sec. 60.3(b). Thereafter, the 
community will be given a period of six months from the date the 
Director provides the data set forth in Sec. 60.3 (c), (d), (e) or (f) 
in which to meet the requirements of the applicable paragraph.
    (b) A mudslide (i.e., mudflow)-prone community applying for flood 
insurance eligibility shall meet the standards of Sec. 60.4(a) to become 
eligible. Thereafter, the community will be given a period of six months 
from the date the mudslide (i.e., mudflow) areas having special mudslide 
hazards are delineated in which to meet the requirements of 
Sec. 60.4(b).
    (c) A flood-related erosion-prone community applying for flood 
insurance eligibility shall meet the standards of Sec. 60.5(a) to become 
eligible. Thereafter, the community will be given a period of six months 
from the date the flood-related erosion areas having special erosion 
hazards are delineated in which to meet the requirements of 
Sec. 60.5(b).
    (d) Communities identified in part 65 of this subchapter as 
containing more than one type of hazard (e.g., any combination of 
special flood, mudslide (i.e., mudflow), and flood-related erosion 
hazard areas) shall adopt flood plain management regulations for each 
type of hazard consistent with the requirements of Secs. 60.3, 60.4 and 
60.5.
    (e) Local flood plain management regulations may be submitted to the 
State Coordinating Agency designated pursuant to Sec. 60.25 for its 
advice and concurrence. The submission to the State shall clearly 
describe proposed enforcement procedures.
    (f) The community official responsible for submitting annual or 
biennial reports to the Administrator pursuant to Sec. 59.22(b)(2) of 
this subchapter shall also submit copies of each annual or biennial 
report to any State Coordinating Agency.
    (g) A community shall assure that its comprehensive plan is 
consistent with the flood plain management objectives of this part.
    (h) The community shall adopt and enforce flood plain management 
regulations based on data provided by the Administrator. Without prior 
approval of the Administrator, the community shall not adopt and enforce 
flood plain management regulations based upon modified data reflecting 
natural or man-made physical changes.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 29318, June 24, 1983; 48 FR 44552, Sept. 29, 1983; 
49 FR 4751, Feb. 8, 1984; 50 FR 36024, Sept. 4, 1985; 59 FR 53598, Oct. 
25, 1994]



Sec. 60.3  Flood plain management criteria for flood-prone areas.

    The Administrator will provide the data upon which flood plain 
management regulations shall be based. If the Administrator has not 
provided sufficient data to furnish a basis for these regulations in a 
particular community, the community shall obtain, review and reasonably 
utilize data available from other Federal, State or other sources 
pending receipt of data from the Administrator. However, when special 
flood hazard area designations and

[[Page 236]]

water surface elevations have been furnished by the Administrator, they 
shall apply. The symbols defining such special flood hazard designations 
are set forth in Sec. 64.3 of this subchapter. In all cases the minimum 
requirements governing the adequacy of the flood plain management 
regulations for flood-prone areas adopted by a particular community 
depend on the amount of technical data formally provided to the 
community by the Administrator. Minimum standards for communities are as 
follows:
    (a) When the Administrator has not defined the special flood hazard 
areas within a community, has not provided water surface elevation data, 
and has not provided sufficient data to identify the floodway or coastal 
high hazard area, but the community has indicated the presence of such 
hazards by submitting an application to participate in the Program, the 
community shall:
    (1) Require permits for all proposed construction or other 
development in the community, including the placement of manufactured 
homes, so that it may determine whether such construction or other 
development is proposed within flood-prone areas;
    (2) Review proposed development to assure that all necessary permits 
have been received from those governmental agencies from which approval 
is required by Federal or State law, including section 404 of the 
Federal Water Pollution Control Act Amendments of 1972, 33 U.S.C. 1334;
    (3) Review all permit applications to determine whether proposed 
building sites will be reasonably safe from flooding. If a proposed 
building site is in a flood-prone area, all new construction and 
substantial improvements shall (i) be designed (or modified) and 
adequately anchored to prevent flotation, collapse, or lateral movement 
of the structure resulting from hydrodynamic and hydrostatic loads, 
including the effects of buoyancy, (ii) be constructed with materials 
resistant to flood damage, (iii) be constructed by methods and practices 
that minimize flood damages, and (iv) be constructed with electrical, 
heating, ventilation, plumbing, and air conditioning equipment and other 
service facilities that are designed and/or located so as to prevent 
water from entering or accumulating within the components during 
conditions of flooding.
    (4) Review subdivision proposals and other proposed new development, 
including manufactured home parks or subdivisions, to determine whether 
such proposals will be reasonably safe from flooding. If a subdivision 
proposal or other proposed new development is in a flood-prone area, any 
such proposals shall be reviewed to assure that (i) all such proposals 
are consistent with the need to minimize flood damage within the flood-
prone area, (ii) all public utilities and facilities, such as sewer, 
gas, electrical, and water systems are located and constructed to 
minimize or eliminate flood damage, and (iii) adequate drainage is 
provided to reduce exposure to flood hazards;
    (5) Require within flood-prone areas new and replacement water 
supply systems to be designed to minimize or eliminate infiltration of 
flood waters into the systems; and
    (6) Require within flood-prone areas (i) new and replacement 
sanitary sewage systems to be designed to minimize or eliminate 
infiltration of flood waters into the systems and discharges from the 
systems into flood waters and (ii) onsite waste disposal systems to be 
located to avoid impairment to them or contamination from them during 
flooding.
    (b) When the Administrator has designated areas of special flood 
hazards (A zones) by the publication of a community's FHBM or FIRM, but 
has neither produced water surface elevation data nor identified a 
floodway or coastal high hazard area, the community shall:
    (1) Require permits for all proposed construction and other 
developments including the placement of manufactured homes, within Zone 
A on the community's FHBM or FIRM;
    (2) Require the application of the standards in paragraphs (a) (2), 
(3), (4), (5) and (6) of this section to development within Zone A on 
the community's FHBM or FIRM;
    (3) Require that all new subdivision proposals and other proposed 
developments (including proposals for manufactured home parks and 
subdivisions)

[[Page 237]]

greater than 50 lots or 5 acres, whichever is the lesser, include within 
such proposals base flood elevation data;
    (4) Obtain, review and reasonably utilize any base flood elevation 
and floodway data available from a Federal, State, or other source, 
including data developed pursuant to paragraph (b)(3) of this section, 
as criteria for requiring that new construction, substantial 
improvements, or other development in Zone A on the community's FHBM or 
FIRM meet the standards in paragraphs (c)(2), (c)(3), (c)(5), (c)(6), 
(c)(12), (c)(14), (d)(2) and (d)(3) of this section;
    (5) Where base flood elevation data are utilized, within Zone A on 
the community's FHBM or FIRM:
    (i) Obtain the elevation (in relation to mean sea level) of the 
lowest floor (including basement) of all new and substantially improved 
structures, and
    (ii) Obtain, if the structure has been floodproofed in accordance 
with paragraph (c)(3)(ii) of this section, the elevation (in relation to 
mean sea level) to which the structure was floodproofed, and
    (iii) Maintain a record of all such information with the official 
designated by the community under Sec. 59.22 (a)(9)(iii);
    (6) Notify, in riverine situations, adjacent communities and the 
State Coordinating Office prior to any alteration or relocation of a 
watercourse, and submit copies of such notifications to the 
Administrator;
    (7) Assure that the flood carrying capacity within the altered or 
relocated portion of any watercourse is maintained;
    (8) Require that all manufactured homes to be placed within Zone A 
on a community's FHBM or FIRM shall be installed using methods and 
practices which minimize flood damage. For the purposes of this 
requirement, manufactured homes must be elevated and anchored to resist 
flotation, collapse, or lateral movement. Methods of anchoring may 
include, but are not to be limited to, use of over-the-top or frame ties 
to ground anchors. This requirement is in addition to applicable State 
and local anchoring requirements for resisting wind forces.
    (c) When the Administrator has provided a notice of final flood 
elevations for one or more special flood hazard areas on the community's 
FIRM and, if appropriate, has designated other special flood hazard 
areas without base flood elevations on the community's FIRM, but has not 
identified a regulatory floodway or coastal high hazard area, the 
community shall:
    (1) Require the standards of paragraph (b) of this section within 
all A1-30 zones, AE zones, A zones, AH zones, and AO zones, on the 
community's FIRM;
    (2) Require that all new construction and substantial improvements 
of residential structures within Zones A1-30, AE and AH zones on the 
community's FIRM have the lowest floor (including basement) elevated to 
or above the base flood level, unless the community is granted an 
exception by the Administrator for the allowance of basements in 
accordance with Sec. 60.6 (b) or (c);
    (3) Require that all new construction and substantial improvements 
of non-residential structures within Zones A1-30, AE and AH zones on the 
community's firm (i) have the lowest floor (including basement) elevated 
to or above the base flood level or, (ii) together with attendant 
utility and sanitary facilities, be designed so that below the base 
flood level the structure is watertight with walls substantially 
impermeable to the passage of water and with structural components 
having the capability of resisting hydrostatic and hydrodynamic loads 
and effects of buoyancy;
    (4) Provide that where a non-residential structure is intended to be 
made watertight below the base flood level, (i) a registered 
professional engineer or architect shall develop and/or review 
structural design, specifications, and plans for the construction, and 
shall certify that the design and methods of construction are in 
accordance with accepted standards of practice for meeting the 
applicable provisions of paragraph (c)(3)(ii) or (c)(8)(ii) of this 
section, and (ii) a record of such certificates which includes the 
specific elevation (in relation to mean sea level) to which such 
structures are floodproofed shall be maintained with

[[Page 238]]

the official designated by the community under Sec. 59.22(a)(9)(iii);
    (5) Require, for all new construction and substantial improvements, 
that fully enclosed areas below the lowest floor that are usable solely 
for parking of vehicles, building access or storage in an area other 
than a basement and which are subject to flooding shall be designed to 
automatically equalize hydrostatic flood forces on exterior walls by 
allowing for the entry and exit of floodwaters. Designs for meeting this 
requirement must either be certified by a registered professional 
engineer or architect or meet or exceed the following minimum criteria: 
A minimum of two openings having a total net area of not less than one 
square inch for every square foot of enclosed area subject to flooding 
shall be provided. The bottom of all openings shall be no higher than 
one foot above grade. Openings may be equipped with screens, louvers, 
valves, or other coverings or devices provided that they permit the 
automatic entry and exit of floodwaters.
    (6) Require that manufactured homes that are placed or substantially 
improved within Zones A1-30, AH, and AE on the community's FIRM on sites
    (i) Outside of a manufactured home park or subdivision,
    (ii) In a new manufactured home park or subdivision,
    (iii) In an expansion to an existing manufactured home park or 
subdivision, or
    (iv) In an existing manufactured home park or subdivision on which a 
manufactured home has incurred ``substantial damage'' as the result of a 
flood, be elevated on a permanent foundation such that the lowest floor 
of the manufactured home is elevated to or above the base flood 
elevation and be securely anchored to an adequately anchored foundation 
system to resist floatation collapse and lateral movement.
    (7) Require within any AO zone on the community's FIRM that all new 
construction and substantial improvements of residential structures have 
the lowest floor (including basement) elevated above the highest 
adjacent grade at least as high as the depth number specified in feet on 
the community's FIRM (at least two feet if no depth number is 
specified);
    (8) Require within any AO zone on the community's FIRM that all new 
construction and substantial improvements of nonresidential structures 
(i) have the lowest floor (including basement) elevated above the 
highest adjacent grade at least as high as the depth number specified in 
feet on the community's FIRM (at least two feet if no depth number is 
specified), or (ii) together with attendant utility and sanitary 
facilities be completely floodproofed to that level to meet the 
floodproofing standard specified in Sec. 60.3(c)(3)(ii);
    (9) Require within any A99 zones on a community's FIRM the standards 
of paragraphs (a)(1) through (a)(4)(i) and (b)(5) through (b)(9) of this 
section;
    (10) Require until a regulatory floodway is designated, that no new 
construction, substantial improvements, or other development (including 
fill) shall be permitted within Zones A1-30 and AE on the community's 
FIRM, unless it is demonstrated that the cumulative effect of the 
proposed development, when combined with all other existing and 
anticipated development, will not increase the water surface elevation 
of the base flood more than one foot at any point within the community.
    (11) Require within Zones AH and AO, adequate drainage paths around 
structures on slopes, to guide floodwaters around and away from proposed 
structures.
    (12) Require that manufactured homes to be placed or substantially 
improved on sites in an existing manufactured home park or subdivision 
within Zones A-1-30, AH, and AE on the community's FIRM that are not 
subject to the provisions of paragraph (c)(6) of this section be 
elevated so that either
    (i) The lowest floor of the manufactured home is at or above the 
base flood elevation, or
    (ii) The manufactured home chassis is supported by reinforced piers 
or other foundation elements of at least equivalent strength that are no 
less than 36 inches in height above grade and be securely anchored to an 
adequately anchored foundation system to

[[Page 239]]

resist floatation, collapse, and lateral movement.
    (13) Notwithstanding any other provisions of Sec. 60.3, a community 
may approve certain development in Zones Al-30, AE, and AH, on the 
community's FIRM which increase the water surface elevation of the base 
flood by more than one foot, provided that the community first applies 
for a conditional FIRM revision, fulfills the requirements for such a 
revision as established under the provisions of Sec. 65.12, and receives 
the approval of the Administrator.
    (14) Require that recreational vehicles placed on sites within Zones 
A1-30, AH, and AE on the community's FIRM either
    (i) Be on the site for fewer than 180 consecutive days,
    (ii) Be fully licensed and ready for highway use, or
    (iii) Meet the permit requirements of paragraph (b)(1) of this 
section and the elevation and anchoring requirements for ``manufactured 
homes'' in paragraph (c)(6) of this section.

A recreational vehicle is ready for highway use if it is on its wheels 
or jacking system, is attached to the site only by quick disconnect type 
utilities and security devices, and has no permanently attached 
additions.
    (d) When the Administrator has provided a notice of final base flood 
elevations within Zones A1-30 and/or AE on the community's FIRM and, if 
appropriate, has designated AO zones, AH zones, A99 zones, and A zones 
on the community's FIRM, and has provided data from which the community 
shall designate its regulatory floodway, the community shall:
    (1) Meet the requirements of paragraphs (c) (1) through (14) of this 
section;
    (2) Select and adopt a regulatory floodway based on the principle 
that the area chosen for the regulatory floodway must be designed to 
carry the waters of the base flood, without increasing the water surface 
elevation of that flood more than one foot at any point;
    (3) Prohibit encroachments, including fill, new construction, 
substantial improvements, and other development within the adopted 
regulatory floodway unless it has been demonstrated through hydrologic 
and hydraulic analyses performed in accordance with standard engineering 
practice that the proposed encroachment would not result in any increase 
in flood levels within the community during the occurrence of the base 
flood discharge;
    (4) Notwithstanding any other provisions of Sec. 60.3, a community 
may permit encroachments within the adopted regulatory floodway that 
would result in an increase in base flood elevations, provided that the 
community first applies for a conditional FIRM and floodway revision, 
fulfills the requirements for such revisions as established under the 
provisions of Sec. 65.12, and receives the approval of the 
Administrator.
    (e) When the Administrator has provided a notice of final base flood 
elevations within Zones A1-30 and/or AE on the community's FIRM and, if 
appropriate, has designated AH zones, AO zones, A99 zones, and A zones 
on the community's FIRM, and has identified on the community's FIRM 
coastal high hazard areas by designating Zones V1-30, VE, and/or V, the 
community shall:
    (1) Meet the requirements of paragraphs (c)(1) through (14) of this 
section;
    (2) Within Zones V1-30, VE, and V on a community's FIRM, (i ) obtain 
the elevation (in relation to mean sea level) of the bottom of the 
lowest structural member of the lowest floor (excluding pilings and 
columns) of all new and substantially improved structures, and whether 
or not such structures contain a basement, and (ii) maintain a record of 
all such information with the official designated by the community under 
Sec. 59.22(a)(9)(iii);
    (3) Provide that all new construction within Zones V1-30, VE, and V 
on the community's FIRM is located landward of the reach of mean high 
tide;
    (4) Provide that all new construction and substantial improvements 
in Zones V1-30 and VE, and also Zone V if base flood elevation data is 
available, on the community's FIRM, are elevated on pilings and columns 
so that (i) the bottom of the lowest horizontal structural member of the 
lowest floor (excluding the pilings or columns) is elevated to

[[Page 240]]

or above the base flood level; and (ii) the pile or column foundation 
and structure attached thereto is anchored to resist flotation, collapse 
and lateral movement due to the effects of wind and water loads acting 
simultaneously on all building components. Water loading values used 
shall be those associated with the base flood. Wind loading values used 
shall be those required by applicable State or local building standards. 
A registered professional engineer or architect shall develop or review 
the structural design, specifications and plans for the construction, 
and shall certify that the design and methods of construction to be used 
are in accordance with accepted standards of practice for meeting the 
provisions of paragraphs (e)(4) (i) and (ii) of this section.
    (5) Provide that all new construction and substantial improvements 
within Zones V1-30, VE, and V on the community's FIRM have the space 
below the lowest floor either free of obstruction or constructed with 
non-supporting breakaway walls, open wood lattice-work, or insect 
screening intended to collapse under wind and water loads without 
causing collapse, displacement, or other structural damage to the 
elevated portion of the building or supporting foundation system. For 
the purposes of this section, a breakway wall shall have a design safe 
loading resistance of not less than 10 and no more than 20 pounds per 
square foot. Use of breakway walls which exceed a design safe loading 
resistance of 20 pounds per square foot (either by design or when so 
required by local or State codes) may be permitted only if a registered 
professional engineer or architect certifies that the designs proposed 
meet the following conditions:
    (i) Breakaway wall collapse shall result from a water load less than 
that which would occur during the base flood; and,
    (ii) The elevated portion of the building and supporting foundation 
system shall not be subject to collapse, displacement, or other 
structural damage due to the effects of wind and water loads acting 
simultaneously on all building components (structural and non-
structural). Water loading values used shall be those associated with 
the base flood. Wind loading values used shall be those required by 
applicable State or local building standards.

Such enclosed space shall be useable solely for parking of vehicles, 
building access, or storage.
    (6) Prohibit the use of fill for structural support of buildings 
within Zones V1-30, VE, and V on the community's FIRM;
    (7) Prohibit man-made alteration of sand dunes and mangrove stands 
within Zones V1-30, VE, and V on the community's FIRM which would 
increase potential flood damage.
    (8) Require that manufactured homes placed or substantially improved 
within Zones V1-30, V, and VE on the community's FIRM on sites
    (i) Outside of a manufactured home park or subdivision,
    (ii) In a new manufactured home park or subdivision,
    (iii) In an expansion to an existing manufactured home park or 
subdivision, or
    (iv) In an existing manufactured home park or subdivision on which a 
manufactured home has incurred ``substantial damage'' as the result of a 
flood, meet the standards of paragraphs (e)(2) through (7) of this 
section and that manufactured homes placed or substantially improved on 
other sites in an existing manufactured home park or subdivision within 
Zones VI-30, V, and VE on the community's FIRM meet the requirements of 
paragraph (c)(12) of this section.
    (9) Require that recreational vehicles placed on sites within Zones 
V1-30, V, and VE on the community's FIRM either
    (i) Be on the site for fewer than 180 consecutive days,
    (ii) Be fully licensed and ready for highway use, or
    (iii) Meet the requirements in paragraphs (b)(1) and (e) (2) through 
(7) of this section.

A recreational vehicle is ready for highway use if it is on its wheels 
or jacking system, is attached to the site only by quick disconnect type 
utilities and security devices, and has no permanently attached 
additions.

[[Page 241]]

    (f) When the Director has provided a notice of final base flood 
elevations within Zones A1-30 or AE on the community's Flood Insurance 
Rate Map, and, if appropriate, has designated AH zones, AO zones, A99 
zones, and A zones on the community's Flood Insurance Rate Map, and has 
identified flood protection restoration areas by designating Zones AR, 
AR/A1-30, AR/AE, AR/AH, AR/AO, or AR/A, the community shall:
    (1) Meet the requirements of paragraphs (c) (1) through (14) and (d) 
(1) through (4) of this section.
    (2) Adopt the official map or legal description of those areas 
within Zones AR, AR/A1-30, AR/AE, AR/AH, AR/A, or AR/AO that are 
designated developed areas as defined in Sec. 59.1 in accordance with 
the eligibility procedures under Sec. 65.14.
    (3) For all new construction of structures in areas within Zone AR 
that are designated as developed areas and in other areas within Zone AR 
where the AR flood depth is five feet or less:
    (i) Determine the lower of either the AR base flood elevation or the 
elevation that is 3 feet above highest adjacent grade; and
    (ii) Using this elevation, require the standards of paragraphs (c) 
(1) through (14).
    (4) For all new construction of structures in those areas within 
Zone AR that are not designated as developed areas where the AR flood 
depth is greater than 5 feet:
    (i) Determine the AR base flood elevation; and
    (ii) Using that elevation require the standards of paragraphs (c) 
(1) through (14).
    (5) For all new construction of structures in areas within Zone AR/
A1-30, AR/AE, AR/AH, AR/AO, and AR/A:
    (i) Determine the applicable elevation for Zone AR from paragraphs 
(3) and (4);
    (ii) Determine the base flood elevation or flood depth for the 
underlying A1-30, AE, AH, AO and A Zone; and
    (iii) Using the higher elevation from (i) and (ii) require the 
standards of paragraphs (c) (1) through (14).
    (6) For all substantial improvements to existing construction within 
Zones AR/A1-30, AR/AE, AR/AH, AR/AO, and AR/A:
    (i) Determine the A1-30 or AE, AH, AO, or A Zone base flood 
elevation; and
    (ii) Using this elevation apply the requirements of paragraphs 
(c)(1) through (c)(14).
    (7) Notify the permit applicant that the area has been designated as 
an AR, AR/A1-30, AR/AE, AR/AH, AR/AO, or AR/A Zone and whether the 
structure will be elevated or protected to or above the AR base flood 
elevation.

[41 FR 46975, Oct. 26, 1976]

    Editorial Note: For Federal Register citations affecting Sec. 60.3, 
see the List of Sections Affected in the Finding Aids section of this 
volume.



Sec. 60.4  Flood plain management criteria for mudslide (i.e., mudflow)-prone areas.

    The Administrator will provide the data upon which flood plain 
management regulations shall be based. If the Administrator has not 
provided sufficient data to furnish a basis for these regulations in a 
particular community, the community shall obtain, review, and reasonably 
utilize data available from other Federal, State or other sources 
pending receipt of data from the Administrator. However, when special 
mudslide (i.e., mudflow) hazard area designations have been furnished by 
the Administrator, they shall apply. The symbols defining such special 
mudslide (i.e., mudflow) hazard designations are set forth in Sec. 64.3 
of this subchapter. In all cases, the minimum requirements for mudslide 
(i.e., mudflow)-prone areas adopted by a particular community depend on 
the amount of technical data provided to the community by the 
Administrator. Minimum standards for communities are as follows:
    (a) When the Administrator has not yet identified any area within 
the community as an area having special mudslide (i.e., mudflow) 
hazards, but the community has indicated the presence of such hazards by 
submitting an application to participate in the Program, the community 
shall
    (1) Require permits for all proposed construction or other 
development in the community so that it may determine whether 
development is proposed

[[Page 242]]

within mudslide (i.e., mudflow)-prone areas;
    (2) Require review of each permit application to determine whether 
the proposed site and improvements will be reasonably safe from 
mudslides (i.e., mudflows). Factors to be considered in making such a 
determination should include but not be limited to (i) the type and 
quality of soils, (ii) any evidence of ground water or surface water 
problems, (iii) the depth and quality of any fill, (iv) the overall 
slope of the site, and (v) the weight that any proposed structure will 
impose on the slope;
    (3) Require, if a proposed site and improvements are in a location 
that may have mudslide (i.e., mudflow) hazards, that (i) a site 
investigation and further review be made by persons qualified in geology 
and soils engineering, (ii) the proposed grading, excavations, new 
construction, and substantial improvements are adequately designed and 
protected against mudslide (i.e., mudflow) damages, (iii) the proposed 
grading, excavations, new construction and substantial improvements do 
not aggravate the existing hazard by creating either on-site or off-site 
disturbances, and (iv) drainage, planting, watering, and maintenance be 
such as not to endanger slope stability.
    (b) When the Administrator has delineated Zone M on the community's 
FIRM, the community shall:
    (1) Meet the requirements of paragraph (a) of this section; and
    (2) Adopt and enforce a grading ordinance or regulation in 
accordance with data supplied by the Administrator which (i) regulates 
the location of foundation systems and utility systems of new 
construction and substantial improvements, (ii) regulates the location, 
drainage and maintenance of all excavations, cuts and fills and planted 
slopes, (iii) provides special requirements for protective measures 
including but not necessarily limited to retaining walls, buttress 
fills, sub-drains, diverter terraces, benchings, etc., and (iv) requires 
engineering drawings and specifications to be submitted for all 
corrective measures, accompanied by supporting soils engineering and 
geology reports. Guidance may be obtained from the provisions of the 
1973 edition and any subsequent edition of the Uniform Building Code, 
sections 7001 through 7006, and 7008 through 7015. The Uniform Building 
Code is published by the International Conference of Building Officials, 
50 South Los Robles, Pasadena, California 91101.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 60.5  Flood plain management criteria for flood-related erosion-prone areas.

    The Administrator will provide the data upon which flood plain 
management regulations for flood-related erosion-prone areas shall be 
based. If the Administrator has not provided sufficient data to furnish 
a basis for these regulations in a particular community, the community 
shall obtain, review, and reasonably utilize data available from other 
Federal, State or other sources, pending receipt of data from the 
Administrator. However, when special flood-related erosion hazard area 
designations have been furnished by the Administrator they shall apply. 
The symbols defining such special flood-related erosion hazard 
designations are set forth in Sec. 64.3 of this subchapter. In all cases 
the minimum requirements governing the adequacy of the flood plain 
management regulations for flood-related erosion-prone areas adopted by 
a particular community depend on the amount of technical data provided 
to the community by the Administrator. Minimum standards for communities 
are as follows:
    (a) When the Administrator has not yet identified any area within 
the community as having special flood-related erosion hazards, but the 
community has indicated the presence of such hazards by submitting an 
application to participate in the Program, the community shall
    (1) Require the issuance of a permit for all proposed construction, 
or other development in the area of flood-related erosion hazard, as it 
is known to the community;
    (2) Require review of each permit application to determine whether 
the proposed site alterations and improvements will be reasonably safe 
from flood-related erosion and will not cause

[[Page 243]]

flood-related erosion hazards or otherwise aggravate the existing flood-
related erosion hazard; and
    (3) If a proposed improvement is found to be in the path of flood-
related erosion or to increase the erosion hazard, require the 
improvement to be relocated or adequate protective measures to be taken 
which will not aggravate the existing erosion hazard.
    (b) When the Administrator has delineated Zone E on the community's 
FIRM, the community shall
    (1) Meet the requirements of paragraph (a) of this section; and
    (2) Require a setback for all new development from the ocean, lake, 
bay, riverfront or other body of water, to create a safety buffer 
consisting of a natural vegetative or contour strip. This buffer will be 
designated by the Administrator according to the flood-related erosion 
hazard and erosion rate, in conjunction with the anticipated ``useful 
life'' of structures, and depending upon the geologic, hydrologic, 
topographic and climatic characteristics of the community's land. The 
buffer may be used for suitable open space purposes, such as for 
agricultural, forestry, outdoor recreation and wildlife habitat areas, 
and for other activities using temporary and portable structures only.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 60.6  Variances and exceptions.

    (a) The Administrator does not set forth absolute criteria for 
granting variances from the criteria set forth in Secs. 60.3, 60.4, and 
60.5. The issuance of a variance is for flood plain management purposes 
only. Insurance premium rates are determined by statute according to 
actuarial risk and will not be modified by the granting of a variance. 
The community, after examining the applicant's hardships, shall approve 
or disapprove a request. While the granting of variances generally is 
limited to a lot size less than one-half acre (as set forth in paragraph 
(a)(2) of this section), deviations from that limitation may occur. 
However, as the lot size increases beyond one-half acre, the technical 
justification required for issuing a variance increases. The 
Administrator may review a community's findings justifying the granting 
of variances, and if that review indicates a pattern inconsistent with 
the objectives of sound flood plain management, the Administrator may 
take appropriate action under Sec. 59.24(b) of this subchapter. 
Variances may be issued for the repair or rehabilitation of historic 
structures upon a determination that the proposed repair or 
rehabilitation will not preclude the structure's continued designation 
as a historic structure and the variance is the minimum necessary to 
preserve the historic character and design of the structure. Procedures 
for the granting of variances by a community are as follows:
    (1) Variances shall not be issued by a community within any 
designated regulatory floodway if any increase in flood levels during 
the base flood discharge would result;
    (2) Variances may be issued by a community for new construction and 
substantial improvements to be erected on a lot of one-half acre or less 
in size contiguous to and surrounded by lots with existing structures 
constructed below the base flood level, in conformance with the 
procedures of paragraphs (a) (3), (4), (5) and (6) of this section;
    (3) Variances shall only be issued by a community upon (i) a showing 
of good and sufficient cause, (ii) a determination that failure to grant 
the variance would result in exceptional hardship to the applicant, and 
(iii) a determination that the granting of a variance will not result in 
increased flood heights, additional threats to public safety, 
extraordinary public expense, create nuisances, cause fraud on or 
victimization of the public, or conflict with existing local laws or 
ordinances;
    (4) Variances shall only be issued upon a determination that the 
variance is the minimum necessary, considering the flood hazard, to 
afford relief;
    (5) A community shall notify the applicant in writing over the 
signature of a community official that (i) the issuance of a variance to 
construct a structure below the base flood level will result in 
increased premium rates for flood insurance up to amounts as high as $25 
for $100 of insurance coverage and (ii) such construction below the

[[Page 244]]

base flood level increases risks to life and property. Such notification 
shall be maintained with a record of all variance actions as required in 
paragraph (a)(6) of this section; and
    (6) A community shall (i) maintain a record of all variance actions, 
including justification for their issuance, and (ii) report such 
variances issued in its annual or biennial report submitted to the 
Administrator.
    (7) Variances may be issued by a community for new construction and 
substantial improvements and for other development necessary for the 
conduct of a functionally dependent use provided that (i) the criteria 
of paragraphs (a)(1) through (a)(4) of this section are met, and (ii) 
the structure or other development is protected by methods that minimize 
flood damages during the base flood and create no additional threats to 
public safety.
    (b)(1) The requirement that each flood-prone, mudslide (i.e., 
mudflow)-prone, and flood-related erosion prone community must adopt and 
submit adequate flood plain management regulations as a condition of 
initial and continued flood insurance eligibility is statutory and 
cannot be waived, and such regulations shall be adopted by a community 
within the time periods specified in Secs. 60.3, 60.4 or Sec. 60.5. 
However, certain exceptions from the standards contained in this subpart 
may be permitted where the Administrator recognizes that, because of 
extraordinary circumstances, local conditions may render the application 
of certain standards the cause for severe hardship and gross inequity 
for a particular community. Consequently, a community proposing the 
adoption of flood plain management regulations which vary from the 
standards set forth in Secs. 60.3, 60.4, or Sec. 60.5, shall explain in 
writing to the Administrator the nature and extent of and the reasons 
for the exception request and shall include sufficient supporting 
economic, environmental, topographic, hydrologic, and other scientific 
and technical data, and data with respect to the impact on public safety 
and the environment.
    (2) The Administrator shall prepare a Special Environmental 
Clearance to determine whether the proposal for an exception under 
paragraph (b)(1) of this section will have significant impact on the 
human environment. The decision whether an Environmental Impact 
Statement or other environmental document will be prepared, will be made 
in accordance with the procedures set out in 44 CFR part 10. Ninety or 
more days may be required for an environmental quality clearance if the 
proposed exception will have significant impact on the human environment 
thereby requiring an EIS.
    (c) A community may propose flood plain management measures which 
adopt standards for floodproofed residential basements below the base 
flood level in zones A1-30, AH, AO, and AE which are not subject to 
tidal flooding. Nothwithstanding the requirements of paragraph (b) of 
this section the Administrator may approve the proposal provided that:
    (1) The community has demonstrated that areas of special flood 
hazard in which basements will be permitted are subject to shallow and 
low velocity flooding and that there is adequate flood warning time to 
ensure that all residents are notified of impending floods. For the 
purposes of this paragraph flood characteristics must include:
    (i) Flood depths that are five feet or less for developable lots 
that are contiguous to land above the base flood level and three feet or 
less for other lots;
    (ii) Flood velocities that are five feet per second or less; and
    (iii) Flood warning times that are 12 hours or greater. Flood 
warning times of two hours or greater may be approved if the community 
demonstrates that it has a flood warning system and emergency plan in 
operation that is adequate to ensure safe evacuation of flood plain 
residents.
    (2) The community has adopted flood plain management measures that 
require that new construction and substantial improvements of 
residential structures with basements in zones A1-30, AH, AO, and AE 
shall:
    (i) Be designed and built so that any basement area, together with 
attendant utilities and sanitary facilities below the floodproofed 
design level, is

[[Page 245]]

watertight with walls that are impermeable to the passage of water 
without human intervention. Basement walls shall be built with the 
capacity to resist hydrostatic and hydrodynamic loads and the effects of 
buoyancy resulting from flooding to the floodproofed design level, and 
shall be designed so that minimal damage will occur from floods that 
exceed that level. The floodproofed design level shall be an elevation 
one foot above the level of the base flood where the difference between 
the base flood and the 500-year flood is three feet or less and two feet 
above the level of the base flood where the difference is greater than 
three feet.
    (ii) Have the top of the floor of any basement area no lower than 
five feet below the elevation of the base flood;
    (iii) Have the area surrounding the structure on all sides filled to 
or above the elevation of the base flood. Fill must be compacted with 
slopes protected by vegetative cover;
    (iv) Have a registered professional engineer or architect develop or 
review the building's structual design, specifications, and plans, 
including consideration of the depth, velocity, and duration of flooding 
and type and permeability of soils at the building site, and certify 
that the basement design and methods of construction proposed are in 
accordance with accepted standards of practice for meeting the 
provisions of this paragraph;
    (v) Be inspected by the building inspector or other authorized 
representative of the community to verify that the structure is built 
according to its design and those provisions of this section which are 
verifiable.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44543 and 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 
1984; 50 FR 36025, Sept. 4, 1985; 51 FR 30308, Aug. 25, 1986; 54 FR 
33550, Aug. 15, 1989]



Sec. 60.7  Revisions of criteria for flood plain management regulations.

    From time to time part 60 may be revised as experience is acquired 
under the Program and new information becomes available. Communities 
will be given six months from the effective date of any new regulation 
to revise their flood plain management regulations to comply with any 
such changes.



Sec. 60.8  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.



  Subpart B--Requirements for State Flood Plain Management Regulations



Sec. 60.11  Purpose of this subpart.

    (a) A State is considered a ``community'' pursuant to Sec. 59.1 of 
this subchapter; and, accordingly, the Act provides that flood insurance 
shall not be sold or renewed under the Program unless a community has 
adopted adequate flood plain management regulations consistent with 
criteria established by the Administrator.
    (b) This subpart sets forth the flood plain management criteria 
required for State-owned properties located within special hazard areas 
identified by the Administrator. A State shall satisfy such criteria as 
a condition to the purchase of a Standard Flood Insurance Policy for a 
State-owned structure or its contents, or as a condition to the approval 
by the Administrator, pursuant to part 75 of this subchapter, of its 
plan of self-insurance.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 60.12  Flood plain management criteria for State-owned properties in special hazard areas.

    (a) The State shall comply with the minimum flood plain management 
criteria set forth in Secs. 60.3, 60.4, and 60.5. A State either shall:
    (1) Comply with the flood plain management requirements of all local 
communities participating in the program in which State-owned properties 
are located; or
    (2) Establish and enforce flood plain management regulations which, 
at a minimum, satisfy the criteria set forth in Secs. 60.3, 60.4, and 
60.5.
    (b) The procedures by which a state government adopts and 
administers flood plain management regulations satisfying the criteria 
set forth in

[[Page 246]]

Sec. Sec. 60.3, 60.4 and 60.5 may vary from the procedures by which 
local governments satisfy the criteria.
    (c) If any State-owned property is located in a non-participating 
local community, then the State shall comply with the requirements of 
paragraph (a)(2) of this section for the property.



Sec. 60.13  Noncompliance.

    If a State fails to submit adequate flood plain management 
regulations applicable to State-owned properties pursuant to Sec. 60.12 
within six months of the effective date of this regulation, or fails to 
adequately enforce such regulations, the State shall be subject to 
suspensive action pursuant to Sec. 59.24. Where the State fails to 
adequately enforce its flood plain management regulations, the 
Administrator shall conduct a hearing before initiating such suspensive 
action.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



 Subpart C--Additional Considerations in Managing Flood-Prone, Mudslide 
       (i.e., Mudflow)-Prone and Flood-Related Erosion-Prone Areas



Sec. 60.21  Purpose of this subpart.

    The purpose of this subpart is to encourage the formation and 
adoption of overall comprehensive management plans for flood-prone, 
mudslide (i.e., mudflow)-prone and flood-related erosion-prone areas. 
While adoption by a community of the standards in this subpart is not 
mandatory, the community shall completely evaluate these standards.



Sec. 60.22  Planning considerations for flood-prone areas.

    (a) The flood plain management regulations adopted by a community 
for flood-prone areas should:
    (1) Permit only that development of flood-prone areas which (i) is 
appropriate in light of the probability of flood damage and the need to 
reduce flood losses, (ii) is an acceptable social and economic use of 
the land in relation to the hazards involved, and (iii) does not 
increase the danger to human life;
    (2) Prohibit nonessential or improper installation of public 
utilities and public facilities in flood-prone areas.
    (b) In formulating community development goals after the occurrence 
of a flood disaster, each community shall consider--
    (1) Preservation of the flood-prone areas for open space purposes;
    (2) Relocation of occupants away from flood-prone areas;
    (3) Acquisition of land or land development rights for public 
purposes consistent with a policy of minimization of future property 
losses;
    (4) Acquisition of frequently flood-damaged structures;
    (c) In formulating community development goals and in adopting flood 
plain management regulations, each community shall consider at least the 
following factors--
    (1) Human safety;
    (2) Diversion of development to areas safe from flooding in light of 
the need to reduce flood damages and in light of the need to prevent 
environmentally incompatible flood plain use;
    (3) Full disclosure to all prospective and interested parties 
(including but not limited to purchasers and renters) that (i) certain 
structures are located within flood-prone areas, (ii) variances have 
been granted for certain structures located within flood-prone areas, 
and (iii) premium rates applied to new structures built at elevations 
below the base flood substantially increase as the elevation decreases;
    (4) Adverse effects of flood plain development on existing 
development;
    (5) Encouragement of floodproofing to reduce flood damage;
    (6) Flood warning and emergency preparedness plans;
    (7) Provision for alternative vehicular access and escape routes 
when normal routes are blocked or destroyed by flooding;
    (8) Establishment of minimum floodproofing and access requirements 
for schools, hospitals, nursing homes, orphanages, penal institutions, 
fire stations, police stations, communications centers, water and sewage 
pumping stations, and other public or quasi-public facilities already 
located in the

[[Page 247]]

flood-prone area, to enable them to withstand flood damage, and to 
facilitate emergency operations;
    (9) Improvement of local drainage to control increased runoff that 
might increase the danger of flooding to other properties;
    (10) Coordination of plans with neighboring community's flood plain 
management programs;
    (11) The requirement that all new construction and substantial 
improvements in areas subject to subsidence be elevated above the base 
flood level equal to expected subsidence for at least a ten year period;
    (12) For riverine areas, requiring subdividers to furnish 
delineations for floodways before approving a subdivision;
    (13) Prohibition of any alteration or relocation of a watercourse, 
except as part of an overall drainage basin plan. In the event of an 
overall drainage basin plan, provide that the flood carrying capacity 
within the altered or relocated portion of the watercourse is 
maintained;
    (14) Requirement of setbacks for new construction within Zones V1-
30, VE, and V on a community's FIRM;
    (15) Requirement of additional elevation above the base flood level 
for all new construction and substantial improvements within Zones A1-
30, AE, V1-30, and VE on the community's FIRM to protect against such 
occurrences as wave wash and floating debris, to provide an added margin 
of safety against floods having a magnitude greater than the base flood, 
or to compensate for future urban development;
    (16) Requirement of consistency between state, regional and local 
comprehensive plans and flood plain management programs;
    (17) Requirement of pilings or columns rather than fill, for the 
elevation of structures within flood-prone areas, in order to maintain 
the storage capacity of the flood plain and to minimize the potential 
for negative impacts to sensitive ecological areas;
    (18) Prohibition, within any floodway or coastal high hazard area, 
of plants or facilities in which hazardous substances are manufactured.
    (19) Requirement that a plan for evacuating residents of all 
manufactured home parks or subdivisions located within flood prone areas 
be developed and filed with and approved by appropriate community 
emergency management authorities.

[41 FR 46975, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 50 FR 36025, Sept. 4, 1985; 54 FR 40284, Sept. 29, 1989]



Sec. 60.23  Planning considerations for mudslide (i.e., mudflow)-prone areas.

    The planning process for communities identified under part 65 of 
this subchapter as containing Zone M, or which indicate in their 
applications for flood insurance pursuant to Sec. 59.22 of this 
subchapter that they have mudslide (i.e., mudflow) areas, should 
include--
    (a) The existence and extent of the hazard;
    (b) The potential effects of inappropriate hillside development, 
including
    (1) Loss of life and personal injuries, and
    (2) Public and private property losses, costs, liabilities, and 
exposures resulting from potential mudslide (i.e., mudflow) hazards;
    (c) The means of avoiding the hazard including the (1) availability 
of land which is not mudslide (i.e., mudflow)-prone and the feasibility 
of developing such land instead of further encroaching upon mudslide 
(i.e., mudflow) areas, (2) possibility of public acquisition of land, 
easements, and development rights to assure the proper development of 
hillsides, and (3) advisability of preserving mudslide (i.e., mudflow) 
areas as open space;
    (d) The means of adjusting to the hazard, including the (1) 
establishment by ordinance of site exploration, investigation, design, 
grading, construction, filing, compacting, foundation, sewerage, 
drainage, subdrainage, planting, inspection and maintenance standards 
and requirements that promote proper land use, and (2) provision for 
proper drainage and subdrainage on public property and the location of 
public utilities and service facilities, such as sewer, water, gas and 
electrical systems and streets in a manner designed to minimize exposure 
to mudslide (i.e.,

[[Page 248]]

mudflow) hazards and prevent their aggravation;
    (e) Coordination of land use, sewer, and drainage regulations and 
ordinances with fire prevention, flood plain, mudslide (i.e., mudflow), 
soil, land, and water regulation in neighboring communities;
    (f) Planning subdivisions and other developments in such a manner as 
to avoid exposure to mudslide (i.e., mudflow) hazards and the control of 
public facility and utility extension to discourage inappropriate 
development;
    (g) Public facility location and design requirements with higher 
site stability and access standards for schools, hospitals, nursing 
homes, orphanages, correctional and other residential institutions, fire 
and police stations, communication centers, electric power transformers 
and substations, water and sewer pumping stations and any other public 
or quasi-public institutions located in the mudslide (i.e., mudflow) 
area to enable them to withstand mudslide (i.e., mudflow) damage and to 
facilitate emergency operations; and
    (h) Provision for emergencies, including:
    (1) Warning, evacuation, abatement, and access procedures in the 
event of mudslide (i.e., mudflow),
    (2) Enactment of public measures and initiation of private 
procedures to limit danger and damage from continued or future mudslides 
(i.e., mudflow),
    (3) Fire prevention procedures in the event of the rupture of gas or 
electrical distribution systems by mudslides,
    (4) Provisions to avoid contamination of water conduits or 
deterioration of slope stability by the rupture of such systems,
    (5) Similar provisions for sewers which in the event of rupture pose 
both health and site stability hazards and
    (6) Provisions for alternative vehicular access and escape routes 
when normal routes are blocked or destroyed by mudslides (i.e., 
mudflow);
    (i) The means for assuring consistency between state, areawide, and 
local comprehensive plans with the plans developed for mudslide (i.e., 
mudflow)-prone areas;
    (j) Deterring the nonessential installation of public utilities and 
public facilities in mudslide (i.e., mudflow)-prone areas.



Sec. 60.24  Planning considerations for flood-related erosion-prone areas.

    The planning process for communities identified under part 65 of 
this subchapter as containing Zone E or which indicate in their 
applications for flood insurance coverage pursuant to Sec. 59.22 of this 
subchapter that they have flood-related erosion areas should include--
    (a) The importance of directing future developments to areas not 
exposed to flood-related erosion;
    (b) The possibility of reserving flood-related erosion-prone areas 
for open space purposes;
    (c) The coordination of all planning for the flood-related erosion-
prone areas with planning at the State and Regional levels, and with 
planning at the level of neighboring communities;
    (d) Preventive action in E zones, including setbacks, shore 
protection works, relocating structures in the path of flood-related 
erosion, and community acquisition of flood-related erosion-prone 
properties for public purposes;
    (e) Consistency of plans for flood-related erosion-prone areas with 
comprehensive plans at the state, regional and local levels.



Sec. 60.25  Designation, duties, and responsibilities of State Coordinating Agencies.

    (a) States are encouraged to demonstrate a commitment to the minimum 
flood plain management criteria set forth in Secs. 60.3, 60.4, and 60.5 
as evidenced by the designation of an agency of State government to be 
responsible for coordinating the Program aspects of flood plain 
management in the State.
    (b) State participation in furthering the objectives of this part 
shall include maintaining capability to perform the appropriate duties 
and responsibilities as follows:
    (1) Enact, whenever necessary, legislation enabling counties and 
municipalities to regulate development within flood-prone areas;

[[Page 249]]

    (2) Encourage and assist communities in qualifying for participation 
in the Program;
    (3) Guide and assist county and municipal public bodies and agencies 
in developing, implementing, and maintaining local flood plain 
management regulations;
    (4) Provide local governments and the general public with Program 
information on the coordination of local activities with Federal and 
State requirements for managing flood-prone areas;
    (5) Assist communities in disseminating information on minimum 
elevation requirements for development within flood-prone areas;
    (6) Assist in the delineation of riverine and coastal flood-prone 
areas, whenever possible, and provide all relevant technical information 
to the Administrator;
    (7) Recommend priorities for Federal flood plain management 
activities in relation to the needs of county and municipal localities 
within the State;
    (8) Provide notification to the Administrator in the event of 
apparent irreconcilable differences between a community's local flood 
plain management program and the minimum requirements of the Program;
    (9) Establish minimum State flood plain management regulatory 
standards consistent with those established in this part and in 
conformance with other Federal and State environmental and water 
pollution standards for the prevention of pollution during periods of 
flooding;
    (10) Assure coordination and consistency of flood plain management 
activities with other State, areawide, and local planning and 
enforcement agencies;
    (11) Assist in the identification and implementation of flood hazard 
mitigation recommendations which are consistent with the minimum flood 
plain management criteria for the Program;
    (12) Participate in flood plain management training opportunities 
and other flood hazard preparedness programs whenever practicable.
    (c) Other duties and responsibilities, which may be deemed 
appropriate by the State and which are to be officially designated as 
being conducted in the capacity of the State Coordinating Agency for the 
Program, may be carried out with prior notification of the 
Administrator.
    (d) For States which have demonstrated a commitment to and 
experience in application of the minimum flood plain management criteria 
set forth in Secs. 60.3, 60.4, and 60.5 as evidenced by the 
establishment and implementation of programs which substantially 
encompass the activities described in paragraphs (a), (b), and (c) of 
this section, the Administrator shall take the foregoing into account 
when:
    (1) Considering State recommendations prior to implementing Program 
activities affecting State communities;
    (2) Considering State approval or certifications of local flood 
plain management regulations as meeting the requirements of this part.

[51 FR 30309, Aug. 25, 1986]



Sec. 60.26  Local coordination.

    (a) Local flood plain, mudslide (i.e., mudflow) and flood-related 
erosion area management, forecasting, emergency preparedness, and damage 
abatement programs should be coordinated with relevant Federal, State, 
and regional programs;
    (b) A community adopting flood plain management regulations pursuant 
to these criteria should coordinate with the appropriate State agency to 
promote public acceptance and use of effective flood plain, mudslide, 
(i.e., mudflow) and flood-related erosion regulations;
    (c) A community should notify adjacent communities prior to 
substantial commercial developments and large subdivisions to be 
undertaken in areas having special flood, mudslide (i.e., mudflow) and/
or flood-related erosion hazards.



PART 61--INSURANCE COVERAGE AND RATES--Table of Contents




Sec.
61.1  Purpose of part.
61.2  Definitions.
61.3  Types of coverage.
61.4  Limitations on coverage.
61.5  Special terms and conditions.
61.6  Maximum amounts of coverage available.
61.7  Risk premium rate determinations.

[[Page 250]]

61.8  Applicability of risk premium rates.
61.9  Establishment of chargeable rates.
61.10  Minimum premiums.
61.11  Effective date and time of coverage under the Standard Flood 
          Insurance Policy--New Business Applications and Endorsements.
61.12  Rates based on a flood protection system involving Federal funds.
61.13  Standard Flood Insurance Policy.
61.14  Standard Flood Insurance Policy Interpretations.
61.16  Probation additional premium.
61.17  Group Flood Insurance Policy.

Appendix A(1) to Part 61--Federal Emergency Management Agency, Federal 
          Insurance Administration Standard Flood Insurance Policy
Appendix A(2) to Part 61--Federal Emergency Management Agency, Federal 
          Insurance Administration Standard Flood Insurance Policy
Appendix A(3) to Part 61--Federal Emergency Management Agency, Federal 
          Insurance Administration Standard Flood Insurance Policy

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127 of Mar. 31, 
1979, 44 FR 19367, 3 CFR, 1979 Comp., p. 376.

    Source: 43 FR 2570, Jan. 17, 1978, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.



Sec. 61.1  Purpose of part.

    This part describes the types of properties eligible for flood 
insurance coverage under the Program, the limits of such coverage, and 
the premium rates actually to be paid by insureds. The specific 
communities eligible for coverage are designated by the Administrator 
from time to time as applications are approved under the emergency 
program and as ratemaking studies of communities are completed prior to 
the regular program. Lists of such communities are periodically 
published under part 64 of this subchapter.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 39068, Aug. 29, 1983; 49 FR 4751, Feb. 8, 1984; 49 
FR 5621, Feb. 14, 1984]



Sec. 61.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.



Sec. 61.3  Types of coverage.

    Insurance coverage under the Program is available for structures and 
their contents. Coverage for each may be purchased separately.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 39068, Aug. 29, 1983; 50 FR 36025, Sept. 4, 1985; 51 
FR 30309, Aug. 25, 1986; 58 FR 62424, Nov. 26, 1993]



Sec. 61.4  Limitations on coverage.

    All flood insurance made available under the Program is subject:
    (a) To the Act, the Amendments thereto, and the Regulations issued 
under the Act;
    (b) To the terms and conditions of the Standard Flood Insurance 
Policy, which shall be promulgated by the Administrator for substance 
and form, and which is subject to interpretation by the Administrator as 
to scope of coverage pursuant to the applicable statutes and 
regulations;
    (c) To the specified limits of coverage set forth in the Application 
and Declarations page of the policy; and
    (d) To the maximum limits of coverage set forth in Sec. 61.6.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 39068, Aug. 29, 1983; 50 FR 36025, Sept. 4, 1985; 53 
FR 16277, May 6, 1988; 58 FR 62424, Nov. 26, 1993]



Sec. 61.5  Special terms and conditions.

    (a) No new flood insurance or renewal of flood insurance policies 
shall be written for properties declared by a duly constituted State or 
local zoning or other authority to be in violation of any flood plain, 
mudslide (i.e., mudflow) or flood-related erosion area management or 
control law, regulation, or ordinance.
    (b) In order to reduce the administrative costs of the Program, of 
which the Federal Government pays a major share, payment of the full 
policyholder premium must be made at the time of application.
    (c) Because of the seasonal nature of flooding, refunds of premiums 
upon cancellation of coverage by the insured are permitted only if the 
insurer ceases to have an ownership interest in the

[[Page 251]]

covered property at the location described in the policy. Refunds of 
premiums for any other reason are subject to the conditions set forth in 
Sec. 62.5 of this subchapter.
    (d) Optional Deductibles, All Zones, are available as follows:

   Category One--1 to 4 Family Building and Contents Coverage Policies  
------------------------------------------------------------------------
                                                            Building/   
                        Options                             contents    
------------------------------------------------------------------------
                                                               $500/$500
                                                             1,000/1,000
                                                             2,000/1,000
                                                             3,000/1,000
                                                             4,000/2,000
                                                             5,000/2,000
------------------------------------------------------------------------


 Category Two--1 to 4 Family Building Coverage Only or Contents Coverage
                              Only Policies                             
------------------------------------------------------------------------
                     Options                      Building  Contents \1\
------------------------------------------------------------------------
                                                      $500        $500  
                                                     1,000       1,000  
                                                     2,000       2,000  
                                                     3,000       3,000  
                                                     4,000       4,000  
                                                     5,000       5,000  
------------------------------------------------------------------------
\1\ Also applies to residential unit contents in other residential      
  building or in multi-unit condominium building.                       


      Category Three--Other Residential and Nonresidential Policies     
------------------------------------------------------------------------
                                                                 Single 
                                                                coverage
                                                   Policy         only  
                                                  combining      policy 
                   Options                      building and    (either 
                                                  contents      building
                                                                   or   
                                                               contents)
------------------------------------------------------------------------
                                                    $500/$500       $500
                                                  1,000/1,000      1,000
                                                  2,000/2,000      2,000
                                                  3,000/3,000      3,000
                                                  4,000/4,000      4,000
                                                  5,000/5,000      5,000
------------------------------------------------------------------------


        Category Four--Residential Condominium Building Policies        
------------------------------------------------------------------------
                                                                 Single 
                                                                coverage
                                                                  only  
                                            Policy combining     policy 
                 Options                      building and      (either 
                                                contents        building
                                                                   or   
                                                               contents)
------------------------------------------------------------------------
                                              $10,000/$10,000    $10,000
                                                25,000/10,000     25,000
------------------------------------------------------------------------


    Note: Any other combination may be submitted for rating to the NFIP.


    (e) The standard flood insurance policy is authorized only under 
terms and conditions established by Federal statute, the program's 
regulations, the Administrator's interpretations and the express terms 
of the policy itself. Accordingly, representations regarding the extent 
and scope of coverage which are not consistent with the National Flood 
Insurance Act of 1968, as amended, or the Program's regulations, are 
void, and the duly licensed property or casualty agent acts for the 
insured and does not act as agent for the Federal Government, the 
Federal Emergency Management Agency, or the servicing agent.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 19140, May 4, 1982; 48 FR 39068, Aug. 29, 1983; 49 
FR 33656, Aug. 23, 1984; 50 FR 36025, Sept. 4, 1985; 51 FR 30309, Aug. 
25, 1986; 53 FR 16277, May 6, 1988; 53 FR 27991, July 26, 1988; 57 FR 
19541, May 7, 1992; 58 FR 62424, Nov. 26, 1993]



Sec. 61.6  Maximum amounts of coverage available.

    (a) Pursuant to section 1306 of the Act, the following are the 
limits of coverage available under the emergency program and under the 
regular program.

                                                                        
------------------------------------------------------------------------
                                              Regular program           
                                  --------------------------------------
                                    Emergency                   Total   
                                   program \1\     Second       amount  
                                   first layer     layer      available 
------------------------------------------------------------------------
    Single Family Residential                                           
                                                                        
Except in Hawaii, Alaska, Guam,                                         
 U.S. Virgin Islands.............      $35,000     $215,000     $250,000
In Hawaii, Alaska, Guam, U.S.                                           
 Virgin Islands..................       50,000      200,000      250,000
                                                                        
        Other Residential                                               
                                                                        
Except in Hawaii, Alaska, Guam,                                         
 U.S. Virgin Islands.............      100,000      150,000      250,000
In Hawaii, Alaska, Guam, U.S.                                           
 Virgin Islands..................      150,000      100,000      250,000
                                                                        
          Nonresidential                                                
                                                                        
Small business...................      100,000      400,000      500,000
Churches and other properties....      100,000      400,000      500,000
                                                                        

[[Page 252]]

                                                                        
           Contents \2\                                                 
                                                                        
Residential......................       10,000       90,000      100,000
Small business...................      100,000      400,000      500,000
Churches, other properties.......      100,000      400,000      500,000
------------------------------------------------------------------------
\1\ Only first layer available under emergency program.                 
\2\ Per unit.                                                           

    (b) In the insuring of a residential condominium building in a 
regular program community, the maximum limit of building coverage is 
$250,000 times the number of units in the building (not to exceed the 
building's replacement cost).

[60 FR 5585, Jan. 30, 1995]



Sec. 61.7  Risk premium rate determinations.

    (a) Pursuant to section 1307 of the Act, the Administrator is 
authorized to undertake studies and investigations to enable him/her to 
estimate the risk premium rates necessary to provide flood insurance in 
accordance with accepted actuarial principles, including applicable 
operating costs and allowances. Such rates are also referred to in this 
subchapter as ``actuarial rates.''
    (b) The Administrator is also authorized to prescribe by regulation 
the rates which can reasonably be charged to insureds in order to 
encourage them to purchase the flood insurance made available under the 
Program. Such rates are referred to in this subchapter as ``chargeable 
rates.'' For areas having special flood, mudslide (i.e., mudflow), and 
flood-related erosion hazards, chargeable rates are usually lower than 
actuarial rates.



Sec. 61.8  Applicability of risk premium rates.

    Risk premium rates are applicable to all flood insurance made 
available for:
    (a) Any structure, the construction or substantial improvement of 
which was started after December 31, 1974 or on or after the effective 
date of the initial FIRM, whichever is later.
    (b) Coverage which exceeds the following limits:
    (1) For dwelling properties in States other than Alaska, Hawaii, the 
Virgin Islands, and Guam (i) $35,000 aggregate liability for any 
property containing only one unit, (ii) $100,000 for any property 
containing more than one unit, and (iii) $10,000 liability per unit for 
any contents related to such unit.
    (2) For dwelling properties in Alaska, Hawaii, the Virgin Islands, 
and Guam (i) $50,000 aggregate liability for any property containing 
only one unit, (ii) $150,000 for property containing more than one unit, 
and (iii) $10,000 aggregate liability per unit for any contents related 
to such unit.
    (3) For churches and other properties (i) $100,000 for the structure 
and (ii) $100,000 for contents of any such unit.
    (c) Any structure or the contents thereof for which the chargeable 
rates prescribed by this part would exceed the risk premium rates.



Sec. 61.9  Establishment of chargeable rates.

    (a) Pursuant to section 1308 of the Act, chargeable rates per year 
per $100 of flood insurance are established as follows for all areas 
designated by the Administrator under part 64 of this subchapter for the 
offering of flood insurance.

                   Rates for New and Renewal Policies                   
------------------------------------------------------------------------
                                                      Rates per year per
                                                       $100 coverage on 
                 Type of structure                  --------------------
                                                     Structure  Contents
------------------------------------------------------------------------
(1) Residential....................................      $0.68     $0.79
(2) All other (including hotels and motels with                         
 normal occupancy of less than 6 months in duration        .79      1.58
------------------------------------------------------------------------

    (b) The contents rate shall be based upon the use of the individual 
premises for which contents coverage is purchased.

[61 FR 8223, Mar. 4, 1996]

[[Page 253]]



Sec. 61.10  Minimum premiums.

    The minimum premium required for any policy, regardless of the term 
or amount of coverage, is $50.00.

[46 FR 13514, Feb. 23, 1981]



Sec. 61.11  Effective date and time of coverage under the Standard Flood Insurance Policy--New Business Applications and Endorsements.

    (a) During the 13-month period beginning on the effective date of a 
revised Flood Hazard Boundary Map or Flood Insurance Rate Map for a 
community, the effective date and time of any initial flood insurance 
coverage shall be 12:01 a.m. (local time) on the first calendar day 
after the application date and the presentment of payment of premium; 
for example, a flood insurance policy applied for with the payment of 
the premium on May 1 will become effective at 12:01 a.m. on May 2.
    (b) Where the initial purchase of flood insurance is in connection 
with the making, increasing, extension, or renewal of a loan, the 
coverage with respect to the property which is the subject of the loan 
shall be effective as of the time of the loan closing, provided the 
written request for the coverage is received by the NFIP and the flood 
insurance policy is applied for and the presentment of payment of 
premium is made at or prior to the loan closing.
    (c) Except as provided by paragraphs (a) and (b) of this section, 
the effective date and time of any new policy or added coverage or 
increase in the amount of coverage shall be 12:01 a.m. (local time) on 
the 30th calendar day after the application date and the presentment of 
payment of premium; for example, a flood insurance policy applied for 
with the payment of the premium on May 1 will become effective at 12:01 
a.m. on May 31.
    (d) Adding new coverage or increasing the amount of coverage in 
force is permitted during the term of any policy. The additional premium 
for any new coverage or increase in the amount of coverage shall be 
calculated pro rata in accordance with the rates currently in force.
    (e) With respect to any submission of an application in connection 
with new business, the payment by an insured to an agent or the issuance 
of premium payment by the agent, does not constitute payment to the 
NFIP, except where a WYO Company receives an application and premium 
payment from one of its agents and elects to refer the business to the 
NFIP Servicing Agent because the WYO Company does not wish to write the 
business, in which case any applicable waiting period under this section 
shall be calculated in accordance with the first sentence of paragraph 
(f) of this section. Therefore, it is important that an application for 
Flood Insurance and its premium be mailed to the NFIP promptly in order 
to have the effective date of the coverage based on the application date 
plus the waiting period. If the application and the premium payment are 
received at the office of the NFIP within ten (10) days from the date of 
application, the waiting period will be calculated from the date of 
application. Also, as an alternative, in those cases where the 
application and premium payment are mailed by certified mail within four 
(4) days from the date of application, the waiting period will be 
calculated from the date of application even though the application and 
premium payment are received at the office of the NFIP after ten (10) 
days following the date of application. Thus, if the application and 
premium payment are received after ten (10) days from the date of the 
application or are not mailed by certified mail within four (4) days 
from the date of application, the waiting period will be calculated from 
the date of receipt at the office of the NFIP. To determine the 
effective date of any coverage added by endorsement to a flood insurance 
policy already in effect, substitute the term endorsement for the term 
application in this paragraph (e).
    (f) With respect to the submission of an application in connection 
with new business, a renewal of a policy in effect and an endorsement to 
a policy in effect, the payment by an insured to an agent or the 
issuance of premium payment to a Write-Your-Own (WYO) Company by the 
agent, accompanied by a properly completed application, renewal or 
endorsement form, as appropriate, shall commence the calculation of any 
applicable waiting period under this section, provided that the agent is

[[Page 254]]

acting in the capacity of an agent of a Write-Your-Own (WYO) Company 
authorized by 44 CFR 62.23, is under written contract to or is an 
employee of such Company, and such WYO Company is, at the time of such 
submission of an application in connection with new business or a 
renewal of or endorsement to flood insurance coverage, engaged in WYO 
business under an arrangement entered into by the Administrator and the 
WYO Company pursuant to Sec. 62.23.
    (g) Subject to the provisions of paragraph (f) of this section, the 
rules set forth in paragraphs (a), (b), (c), (d) and (e) of this section 
apply to WYO Companies, except that premium payments and accompanying 
applications and endorsements shall be mailed to and received by the WYO 
Company, rather than the NFIP.

[43 FR 50427, Oct. 30, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 46 FR 13514, Feb. 23, 1981; 48 FR 39069, Aug. 29, 1983; 48 
FR 44544, Sept. 29, 1983; 49 FR 33656, Aug. 24, 1984; 50 FR 16242, Apr. 
25, 1985; 50 FR 36026, Sept. 4, 1985; 51 FR 30309, Aug. 25, 1986; 53 FR 
15211, Apr. 28, 1988; 60 FR 5585, 5586, Jan. 30, 1995]



Sec. 61.12  Rates based on a flood protection system involving Federal funds.

    (a) Where the Administrator determines that a community has made 
adequate progress on the construction of a flood protection system 
involving Federal funds which will significantly limit the area of 
special flood hazards, the applicable risk premium rates for any 
property, located within a special flood hazard area intended to be 
protected directly by such system will be those risk premium rates which 
would be applicable when the system is complete.
    (b) Adequate progress in paragraph (a) of this section means that 
the community has provided information to the Administrator sufficient 
to determine that substantial completion of the flood protection system 
has been effected because:
    (1) 100 percent of the total financial project cost of the completed 
flood protection system has been authorized;
    (2) At least 60 percent of the total financial project cost of the 
completed flood protection system has been appropriated;
    (3) At least 50 percent of the total financial project cost of the 
completed flood protection system has been expended;
    (4) All critical features of the flood protection system, as 
identified by the Administrator, are under construction, and each 
critical feature is 50 percent completed as measured by the actual 
expenditure of the estimated construction budget funds; and
    (5) The community has not been responsible for any delay in the 
completion of the system.
    (c) Each request by a community for a determination must be 
submitted in writing to the Risk Studies Division, Office of Risk 
Assessment, Federal Insurance Administration, Federal Emergency 
Management Agency, Washington DC, and contain a complete statement of 
all relevant facts relating to the flood protection system, including, 
but not limited to, supporting technical data (e.g., U.S. Army Corps of 
Engineers flood protection project data), cost schedules, budget 
appropriation data and the extent of Federal funding of the system's 
construction. Such facts shall include information sufficient to 
identify all persons affected by such flood protection system or by such 
request: A full and precise statement of intended purposes of the flood 
protection system; and a carefully detailed description of such project, 
including construction completion target dates. In addition, true copies 
of all contracts, agreements, leases, instruments, and other documents 
involved must be submitted with the request. Relevant facts reflected in 
documents, however, must be included in the statement and not merely 
incorporated by reference, and must be accompanied by an analysis of 
their bearing on the requirements of paragraph (b) of this section, 
specifying the pertinent provisions. The request must contain a 
statement whether, to the best of the knowledge of the person 
responsible for preparing the application for the community, the flood 
protection system is currently the subject matter of litigation before 
any Federal, State or local court or administrative agency, and

[[Page 255]]

the purpose of that litigation. The request must also contain a 
statement as to whether the community has previously requested a 
determination with respect to the same subject matter from the 
Administrator, detailing the disposition of such previous request. As 
documents become part of the file and cannot be returned, the original 
documents should not be submitted.
    (d) The effective date for any risk premium rates established under 
this section shall be the date of final determination by the 
Administrator that adequate progress toward completion of a flood 
protection system has been made in a community.
    (e) A responsible official of a community which received a 
determination that adequate progress has been made towards completion of 
a flood protection system shall certify to the Administrator annually on 
the anniversary date of receipt of such determination that no present 
delay in completion of the system is attributable to local sponsors of 
the system, and that a good faith effort is being made to complete the 
project.
    (f) A community for which risk premium rates have been made 
available under section 1307(e) of the National Flood Insurance Act of 
1968, as amended, shall notify the Administrator if, at any time, all 
progress on the completion of the flood protection system has been 
halted or if the project for the completion of the flood protection 
system has been canceled.

[43 FR 2570, Jan. 17, 1978, Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 43061 Sept. 30, 1982; 48 FR 39069, Aug. 29, 1983; 48 
FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 51 FR 30310, Aug. 
25, 1986]



Sec. 61.13  Standard Flood Insurance Policy.

    (a) Incorporation of forms. Each of the Standard Flood Insurance 
Policy forms included in appendix ``A'' hereto (General Property, 
Dwelling, and Residential Condominium Building Association) and by 
reference incorporated herein shall be incorporated into the Standard 
Flood Insurance Policy.
    (b) Endorsements. All endorsements to the Standard Flood Insurance 
Policy shall be final upon publication in the Federal Register for 
inclusion in appendix A.
    (c) Applications. The application and renewal application forms 
utilized by the National Flood Insurance Program shall be the only 
application forms used in connection with the Standard Flood Insurance 
Policy.
    (d) Waivers. The Standard Flood Insurance Policy and required 
endorsements must be used in the Flood Insurance Program, and no 
provision of the said documents shall be altered, varied, or waived 
other than by the express written consent of the Administrator through 
the issuance of an appropriate amendatory endorsement, approved by the 
Administrator as to form and substance for uniform use.
    (e) Oral and written binders. No oral binder or contract shall be 
effective. No written binder shall be effective unless issued with 
express authorization of the Administrator.
    (f) The Standard Flood Insurance Policy and endorsements may be 
issued by private sector ``Write-Your-Own'' (WYO) property insurance 
companies, based upon flood insurance applications and renewal forms, 
all of which instruments of flood insurance may bear the name, as 
Insurer, of the issuing WYO Company. In the case of any Standard Flood 
Insurance Policy, and its related forms, issued by a WYO Company, 
wherever the names ``Federal Emergency Management Agency'' and ``Federal 
Insurance Administration'' appear, the WYO Company is authorized to 
substitute its own name therefor. Standard Flood Insurance Policies 
issued by WYO Companies may be executed by the issuing WYO Company as 
Insurer, in the place and stead of the Federal Insurance Administrator.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 44 FR 62517, Oct. 31, 1979; 48 FR 46791, Oct. 14, 1983; 58 
FR 62424, Nov. 26, 1993]



Sec. 61.14  Standard Flood Insurance Policy Interpretations.

    (a) Definition. A Standard Flood Insurance Policy Interpretation is 
a written determination by the Administrator construing the scope of the 
flood insurance coverage that has been and is provided under the policy.

[[Page 256]]

    (b) Publication and requests for interpretation. The Administrator 
shall, pursuant to these regulations from time to time, issue 
interpretative rulings regarding the provisions of the Standard Flood 
Insurance Policy. Such Interpretations shall be published in the Federal 
Register, made a part of appendix C to these regulations, and 
incorporated by reference as part of these regulations. Any policyholder 
or person in privity with a policyholder may file a request for an 
interpretation in writing with the Federal Insurance Administration, 
Federal Emergency Management Agency, Washington, DC 20472.

[43 FR 2570, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 39072, Aug. 29, 1983]



Sec. 61.16  Probation additional premium.

    The additional premium charged pursuant to Sec. 59.24(b) on each 
policy sold or renewed within a community placed on probation prior to 
October 1, 1992, is $25.00. Where the community was placed on probation 
on or after October 1, 1992, the additional premium charge is $50.00.''.

[50 FR 36026, Sept. 4, 1985, as amended at 57 FR 19541, May 7, 1992]



Sec. 61.17  Group Flood Insurance Policy.

    (a) A Group Flood Insurance Policy (GFIP) is a policy covering all 
individuals named by a State as recipients under Sec. 411 of the 
Stafford Act (42 U.S.C. 5178) of an Individual and Family Grant (IFG) 
program award for flood damage as a result of a Presidential major 
disaster declaration, and, as a one-time, pilot project, to recipients 
of the State of Alaska's own fully funded disaster assistance program 
for individuals and families suffering damage from flooding in September 
and October 1995. Alaska's disaster assistance program is comparable to 
the IFG program in benefits and eligibility requirements, including 
income levels. The State of Alaska has also agreed to provide 
information to the National Flood Insurance Program (NFIP) in a data 
format compatible with NFIP requirements. The premium for the GFIP, 
initially, is a flat fee of $200 per policyholder. Thereafter, the 
premium may be adjusted to reflect NFIP loss experience and any 
adjustment of benefits under the IFG program. The amount of coverage 
shall be equivalent to the maximum grant amount established under 
Sec. 411. The term of the GFIP shall be for 36 months and will begin, 
for implementation with the IFG program, 60 days from the date of the 
disaster declaration. For FEMA's pilot project with the State of Alaska, 
the term of the three-year policy will begin on May 1, 1996. On and 
after the inception date of the GFIP, coverage for IFG recipients or for 
recipients of the one time pilot project of the GFIP for the State of 
Alaska's own comparable fully funded, disaster assistance program, will 
begin on the 30th day after the NFIP receives the records of GFIP 
insureds and their premium payments from the State. A Certificate of 
Flood Insurance shall be sent to each IFG recipient, and, for the one-
time pilot project in Alaska, to each individual or family receiving a 
grant from Alaska's own fully funded disaster assistance program.
    (b) The GFIP is the Standard Flood Insurance Policy Dwelling Form (a 
copy of which is included in Appendix A(1) of this part), except that:
    (1) The GFIP provides coverage for losses caused by land subsidence, 
sewer backup, or seepage of water without regard to the requirement in 
paragraph B.3. of Article 3 that the structure be insured to 80 percent 
of its replacement cost or the maximum amount of insurance available 
under the NFIP.
    (2) Article 7, Deductibles, does not apply to the GFIP. Instead, a 
special deductible of $200 (applicable separately to any building loss 
and any contents loss) applies to insured flood-damage losses sustained 
by the insured property in the course of any subsequent flooding event 
during the term of the GFIP. The separate deductible applicable to 
Article 3 B.3 does not apply.
    (3) Article 9 E., Cancellation of Policy By You, does not apply to 
the GFIP.
    (4) Article 9 G., Policy Renewal, does not apply to the GFIP.
    (c) A notice will be sent to the GFIP certificate holders 
approximately 60 days before the end of the 3-year term

[[Page 257]]

of the GFIP. The notice will (1) encourage them to contact a local 
insurance agent or producer or a private insurance company selling NFIP 
policies under the Write Your Own program of the NFIP to apply for a 
conventional NFIP Standard Flood Insurance Policy and (2) advise them as 
to the amount of coverage they must maintain in order not to jeopardize 
their eligibility for future disaster assistance.

[61 FR 19200, May 1, 1996]

                        Appendix A(1) to Part 61

  Federal Emergency Management Agency, Federal Insurance Administration

                     Standard Flood Insurance Policy

[Issued Pursuant to the National Flood Insurance Act of 1968, or Any 
Acts Amendatory Thereof (Hereinafter Called the Act), and Applicable 
Federal Regulations in Title 44 of the Code of Federal Regulations, 
Subchapter B]

                              Dwelling Form

    Read the policy carefully. The coverage provided is subject to 
limitations, restrictions and exclusions. This policy covers only:
    1. A non-condominium residential building, designed for principal 
use as a dwelling place of one to four families, or
    2. A single family dwelling unit in a condominium building.

                           Insuring Agreement

    Agreement of insurance between the Federal Emergency Management 
Agency (FEMA), as Insurer, (hereinafter known as ``we,'' ``our,'' and 
``us,'') and the Insured, (hereinafter known as ``you'' and ``your'').
    We insure you against all direct physical loss by or from flood to 
the insured property, based upon:
    1. Your having paid the correct amount of premium; and
    2. Our reliance on the accuracy of the information and statements 
you have furnished; and
    3. All the terms of this policy, the National Flood Insurance Act of 
1968, as amended, and Title 44 of the Code of Federal Regulations.
    On this basis, you are insured up to the lesser of:
    1. The actual cash value, except as provided in Article 8, not 
including any antique value, of the property at the time of loss; or
    2. The amount it would cost to repair or replace the property with 
material of like kind and quality within a reasonable time after the 
loss.

                       Article 1--Persons Insured

    We insure only:
    A. The named Insured and legal representatives;
    B. Any mortgagee and loss payee named in the application and 
declarations page, as well as any other mortgagee or loss payee 
determined to exist at the time of a loss (See Article 9, paragraph P.), 
in the order of precedence and to the extent of their interest but for 
no more, in the aggregate, than the interest of the named Insured.

                         Article 2--Definitions

    As used in this policy--
    Act means the National Flood Insurance Act of 1968, and any acts 
amendatory thereof.
    Actual Cash Value means the replacement cost of an insured item of 
property at the time of loss, less the value of physical depreciation as 
to the item damaged.
    Application means the statement made and signed by you or your 
agent, and giving information on the basis of which we determine the 
acceptability of the risk, the policy to be issued and the correct 
premium payment. The correct premium payment must accompany the 
application for the policy to be issued. The application is a part of 
this flood insurance policy.
    Association means the group of unit owners which manages the 
condominium building in which you, as the insured unit owner, maintain 
your residence.
    Base flood means the flood having a one percent chance of being 
equalled or exceeded in any given year.
    Basement means any area of the building, including any sunken room 
or sunken portion of a room, having its floor subgrade (below ground 
level) on all sides.
    Building means a walled and roofed structure, other than a gas or 
liquid storage tank, that is principally above ground and affixed to a 
permanent site, including a manufactured (i.e., mobile) home on a 
permanent foundation, subject to Article 6, paragraph H. and a walled 
and roofed building in the course of construction, alteration or repair.
    Cancellation means that ending of the insurance coverage provided by 
this policy prior to the expiration date.
    Coastal High Hazard Area means an area subject to high velocity 
waters, including hurricane wave wash and tsunamis.
    Condominium means a system of individual ownership of units in a 
multi-unit building or buildings or in single-unit buildings as to which 
each unit owner in the condominium has an undivided interest in the 
common areas of the building(s) and facilities that serve the 
building(s).
    Condominium Association Policy means a policy of flood insurance 
coverage issued to an association pursuant to the Act.

[[Page 258]]

    Declarations Page is a computer generated summary of information 
furnished by you in the application for insurance. The declarations page 
also describes the term of the policy, limits of coverage, and displays 
the premium and our name. The declarations page is a part of this flood 
insurance policy.
    Direct Physical Loss By or From Flood means any loss in the nature 
of actual loss of or physical damage, evidenced by physical changes, to 
the insured property (building or personal property) which is directly 
and proximately caused by a flood (as defined in this policy).
    Dwelling means a building designed for use as a residence for no 
more than four families and a single family dwelling unit in a 
condominium building.
    Elevated Building means a non-basement building which has its lowest 
elevated floor raised above ground level by foundation walls, shear 
walls, posts, piers, pilings, or columns.
    Emergency Program Community means a community wherein a Flood Hazard 
Boundary Map (FHBM) is in effect and only limited amounts of insurance 
are available under the Act.
    Expense Constant means a flat charge per policy term, paid by the 
Insured to defray the Federal Government's policywriting and other 
expenses.
    Expiration Date means the ending of the insurance coverage provided 
by this policy on the expiration date shown on the declarations page.
    Federal policy fee means a flat charge per policy term, paid by the 
Insured to defray certain administrative expenses incurred in carrying 
out the National Flood Insurance Program not covered by the expense 
constant. This fee was established by section 1307(a)(1)(B)(iii) of the 
National Flood Insurance Act of 1968, as amended, and is not subject to 
producers' commissions, expense allowances, or state or local premium 
taxes.
    Flood means:
    A. A general and temporary condition of partial or complete 
inundation of normally dry land area from:
    1. The overflow of inland or tidal waters.
    2. The unusual and rapid accumulation or runoff of surface waters 
from any source.
    3. Mudslides (i.e., mudflows) which are proximately caused by 
flooding as defined in subparagraph A-2 above and are akin to a river of 
liquid and flowing mud on the surfaces of normally dry land areas, 
including your premises, as when earth is carried by a current of water 
and deposited along the path of the current.
    B. The collapse or subsidence of land along the shore of a lake or 
other body of water as a result of erosion or undermining caused by 
waves or currents of water exceeding the cyclical levels which result in 
flooding as defined in subparagraph A-1 above.
    Improvements means fixtures, alterations, installations, or 
additions comprising a part of the insured building or condominium 
dwelling unit.
    Manufactured home means a building transportable in one or more 
sections, which is built on a permanent chassis and designed to be used 
with or without a permanent foundation when connected to the required 
utilities. The term manufactured home does not include park trailers, 
and other similar vehicles. To be eligible for coverage under this 
policy, a manufactured home must be on a permanent foundation and, if 
located in a FEMA designated Special Hazard Area, must meet the 
requirements of paragraph H. of Article 6.
    Mobile home means a manufactured home.
    National Flood Insurance Program means the program of flood 
insurance coverage and floodplain management administered under the Act 
and applicable Federal regulations in Title 44 of the Code of Federal 
Regulations, Subchapter B.
    Policy means the entire written contract between you and us; it 
includes this printed form, the application, and declarations page, any 
endorsements which may be issued and any renewal certificates indicating 
that coverage has been instituted for a new policy and policy term. Only 
one dwelling building or unit, specifically described by you in the 
application, may be insured under this policy, unless application to 
cover more than one dwelling building or unit is made on a form or in a 
format approved for that purpose by the Federal Insurance Administrator.
    Post-FIRM building means a building for which the start of 
construction or substantial improvement occurred after December 31, 
1974, or on or after the effective date of the initial Flood Insurance 
Rate Map (FIRM) for the community in which the building is located, 
whichever is later.
    Pre-FIRM rated building means a building for which the start of 
construction or substantial improvement occurred on or before December 
31, 1974, or before the effective date of the initial FIRM for the 
community in which the building is located, whichever is later.
    Probation Additional Premium means a flat charge per policy term 
paid by the Insured on all new and renewal policies issued covering 
property in a community that has been placed on probation under the 
provisions of 44 CFR 59.24.
    Regular Program Community means a community wherein a FIRM is in 
effect and full limits of coverage are available under the Act.
    Residential condominium building means a building owned by the 
members of a Condominium Association containing one or more residential 
units and in which at least 75 percent of the floor area within the 
building is residential.

[[Page 259]]

    Special hazard area means an area having special flood, mudslide, 
(i.e., mudflow) and/or flood-related erosion hazards, and shown on a 
FHBM or FIRM as Zone A, AO, A1-30, AE, A99, AH, AR, VO, V1-30, VE, V, M 
or E.
    Unit means a single family dwelling unit, owned by the named 
Insured, in a condominium building.
    Valued policy means a policy contract in which the Insurer and the 
Insured agree on the value of the property insured, that value being 
payable in event of total loss.
    Walled and Roofed means the building has in place two or more 
exterior, rigid walls and the roof is fully secured so that the building 
will resist flotation, collapse and lateral movement.

                      Article 3--Losses Not Covered

    We only provide coverage for direct physical loss by or from flood 
which means we do not cover:
    A. Compensation, reimbursement or allowance for:
    1. Loss of use of the insured property or premises.
    2. Loss of access to the insured property or premises.
    3. Loss of profits.
    4. Loss resulting from interruption of business, profession, or 
manufacture.
    5. Your additional living expenses incurred while the insured 
building is being repaired or is uninhabitable for any reason.
    6. Any increased cost of repair or reconstruction as a result of any 
ordinance regulating reconstruction or repair except as provided in 
Coverage D--Increased Cost of Compliance.
    7. Any other economic loss.
    B. Losses from other casualties, including loss caused by:
    1. Theft, fire, windstorm, wind, explosion, earthquake, land 
sinkage, landslide, destabilization or movement of land resulting from 
the accumulation of water in subsurface land areas, gradual erosion, or 
any other earth movement except such mudslides (i.e., mudflows) or 
erosion as is covered under the peril of flood.
    2. Rain, snow, sleet, hail or water spray.
    3. Land subsidence, sewer backup, or seepage of water unless, 
subject to additional deductibles as provided for at Article 7, (a) 
there is a general and temporary condition of flooding in the area, (b) 
the flooding is the proximate cause of the land subsidence, sewer 
backup, or seepage of water, (c) the land subsidence, sewer backup, or 
seepage of water damage occurs no later than 72 hours after the flood 
has receded, and (d) the insured building must be insured, at the time 
of the loss, for at least 80 percent of its replacement cost or the 
maximum amount of insurance available under the National Flood Insurance 
Program.
    4. Freezing, thawing, or the pressure or weight of ice or water.
    5. Water, moisture, mildew, mold or mudslide (i.e., mudflow) damage 
resulting primarily from any condition substantially confined to the 
described dwelling or from any condition which is within your control 
(including but not limited to design, structural or mechanical defects, 
failures, stoppages or breakages of water or sewer lines, drains, pumps, 
fixtures or equipment).
    C. Losses of the following nature:
    1. A loss which is already in progress as of 12:01 a.m. of the first 
day of the policy term, or, as to any increase in the limits of coverage 
which is requested by you, a loss which is already in progress as of 
12:01 a.m. on the date when the additional coverage becomes effective.
    2. A loss from a flood which is confined to the premises on which 
your insured property is located unless the flood is displaced over two 
acres of the premises.
    3. A loss caused by your modification to the insured property which 
materially increases the risk of flooding.
    4. A loss caused intentionally by you or any member of your 
household.
    5. A loss caused by or resulting from power, heating or cooling 
failure, unless such failure results from physical damage to power, 
heating or cooling equipment situated on the premises where the 
described building or unit is located, caused by a flood.
    6. Loss to any building or contents located on property leased from 
the Federal Government, arising from or incident to the flooding of the 
property by the Federal Government, where the lease expressly holds the 
Federal Government harmless, under flood insurance issued under any 
Federal Government program, from loss arising from or incident to the 
flooding of the property by the Federal Government.

Article 4--Property Covered (Subject to Articles 3, 5, and 6 Provisions, 
  Which Also Apply to the Other Articles, Terms and Conditions of This 
                Policy, Including the Insuring Agreement)

                      Coverage A--Building Property

    Subject to paragraph C. below, we cover your dwelling which 
includes:
    A. A residential building, not a condominium, designed for principal 
use as a dwelling place for no more than four families, including:
    1. Additions and extensions attached to and in contact with the 
dwelling by means of a common wall (but see Article 6, paragraph D.2.).
    2. Materials and supplies to be used in constructing, altering or 
repairing the dwelling or an appurtenant structure while stored inside a 
fully enclosed building:
    a. At the property address; or

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    b. On an adjacent property at the time of loss; or
    c. In case of another building at the property address which does 
not have walls on all sides, while stored and secured to prevent 
flotation out of the building during flooding (the flotation out of the 
building shall be deemed by you and us to establish the conclusive 
presumption that the materials and supplies were not reasonably secured 
to prevent flotation, in which case no coverage is provided for such 
materials and supplies under this policy).
    3. As appurtenant structures, detached garages and carports located 
at the described premises, at your option at the time of loss, in an 
amount up to 10 percent of the amount of insurance you have purchased to 
cover the dwelling, including additions to the dwelling. By exercising 
this option, you reduce the amount of insurance available to cover other 
loss relating to Coverage A.
    This option may not be used to extend coverage to buildings:
    a. Occupied, rented or leased in whole or in part for dwelling 
purposes (or held for such use); or
    b. Used in whole or in part for business or farming purposes (or 
held for such uses); or
    c. Which are boathouses.
    4. A building in the course of construction before it is walled and 
roofed subject to the following conditions:
    a. The amount of the deductible for each loss occurrence before the 
building is walled and roofed is two times the deductible which is 
selected to apply after the building is walled and roofed;
    b. Coverage is provided before the building is walled and roofed 
only while construction is in progress, or if construction is halted, 
only for a period of up to 90 continuous days thereafter, until 
construction is resumed; and
    c. There is no coverage before the building is walled and roofed 
where the lowest floor, including basement floor, of a non-elevated 
building or the lowest elevated floor of an elevated building is below 
the base flood elevation in Zones AH, AE or A1-30 or is below the base 
flood elevation adjusted to include the effect of wave action in Zones 
VE or V1-30. The lowest floor levels are based on the bottom of the 
lowest horizontal structural member of the floor in Zones VE or V1-30 
and the top of the floor in Zones AH, AE or A1-30.
    B. Or, we cover your single-family dwelling unit, including 
improvements therein owned solely by you, in a condominium building. We 
also cover your share of assessments made against you as a tenant in 
common in that building's common elements and the common elements of any 
other building of your Condominium Association covered by insurance that 
is:
    1. In the name of your Condominium Association;
    2. Provided under the Act; and
    3. In an amount at least equal to the actual cash value of the 
building's common elements at the beginning of the current policy term 
or the maximum building coverage limit available under the Act, 
whichever is less.
    Provided, with respect to coverage for single-family dwelling unit 
assessments:
    1. Coverage is available only when each of the unit owners 
comprising the membership of the Association are also assessed by reason 
of the same cause and provided the assessment arises out of a direct 
physical loss by or from flood to the condominium building in which your 
unit is located or to another condominium building of the Association, 
as to which the condominium documents (Articles of Association, 
Declarations, and your Deed) impose upon you the responsibility for such 
an assessment). The deductibles provisions of Article 7 of this policy 
do not apply to assessments.
    2. Assessments made by the Association to recoup the amount of a 
loss deductible incurred by the Association in connection with any 
condominium building or contents policy of insurance are not covered.
    3. Assessments made by the Association in connection with loss of or 
damage to personal property, including any contents of any condominium 
building of the Association, are not covered.
    4. Assessments made by the Association of a condominium building are 
not covered if the assessments are made to recoup loss not reimbursed to 
the Association, under a policy of insurance issued pursuant to the 
National Flood Insurance Program, by reason of the fact that the 
condominium building insured under such policy was not, at the time of 
the loss, insured in an amount equal to the lesser of 80 percent or more 
of the full replacement cost of the building or the maximum amount of 
insurance available under the National Flood Insurance Program.
    C. And we cover fixtures including the following items of property, 
if owned solely by you, for which coverage is not provided under 
``Coverage B - Personal Property'':
     Furnaces
     Wall mirrors permanently installed
     Permanently Installed Corner Cupboards, Bookcases, 
Paneling, and Wallpaper
     Venetian Blinds
     Central Air Conditioners
     Awnings and Canopies
     Elevator Equipment
     Fire Sprinkler Systems
     Built-in Dishwashers
     Garbage Disposal Units
     Outdoor Antennas and Aerials
     Pumps and Machinery for operating them
     Carpet Permanently Installed Over Unfinished Flooring

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     Built-in Microwave Ovens
     Hot Water Heaters, Including Solar Water Heaters
     Ranges and Stoves
     Radiators
     Kitchen Cabinets
     Light Fixtures
     Plumbing Fixtures
     Refrigerators

                      Coverage B--Personal Property

    A. Subject to paragraphs B. and C. below, we cover personal 
property:
    1. Owned by you as contents incidental to the occupancy of the 
building.
    2. Owned by members of your family in your household.
    3. At your option and within the limits of personal property 
coverage you have purchased, owned by your guests and servants.
    Such personal property is covered while stored:
    a. Within your dwelling;
    b. Within a fully enclosed building at the property address;
    c. Within a building having in place two or more rigid walls and a 
fully secured roof if the contents are secured to prevent flotation out 
of the building during flooding. The flotation out of the building 
during flooding of any such contents shall be deemed to establish the 
conclusive presumption that the contents were not reasonably secured to 
prevent flotation; or
    d. At a temporary location, as expressly authorized under this 
policy (see Article 5, paragraph C.2.).
    B. Coverage, under this ``Coverage B--Personal Property,'' includes 
the following property if owned solely by you, for which coverage is not 
provided under ``Coverage A--Building Property'':
     Clothes Washers
     Clothes Dryers
     Food Freezers
     Air Conditioning Units
     Portable Dishwashers
     Carpet, including wall-to-wall carpet, over finished 
flooring and whether or not it is permanently installed
     Carpet not permanently installed over unfinished flooring
     Outdoor equipment and furniture stored inside the dwelling 
or another fully enclosed building at the property address
      Portable microwave ovens and ``cook-out'' grills, ovens 
and the like
    C. Limitations. Under this ``Coverage B--Personal Property'' we 
shall not reimburse you for loss as to:
    1. Personal property owned by you in common with any unit owners 
comprising the membership of a Condominium Association.
    2. The following personal property to the extent the loss to any one 
or more of such property exceeds, individually or in total, $250.00:
     Artwork, including but not limited to, paintings, etchings, 
pictures, tapestries, art glass windows including their frames, 
statuary, marbles, and bronzes;
     Rare books;
     Necklaces, bracelets, gems, precious or semi-precious 
stones, watches, articles of gold, silver, or platinum; or
     Furs or any article containing fur which represents its 
principal value.

                       Coverage C--Debris Removal

    Within the limits of your coverage, we cover any expense you incur, 
including the value of your own labor and the labor of members of your 
household at prevailing Federal minimum wage rates, as a result of 
removing debris of, on or from the insured property so long as the 
debris problem was directly caused by a flood. Under these provisions 
coverage extends to:
    A. Non-owned debris from beyond the boundaries of the described 
premises which is physically on the insured property.
    B. Parts of the insured property which is anywhere:
    1. On the described premises; and
    2. On property beyond the boundaries of the described premises.

            Coverage D--Increased Cost of Compliance Coverage

    Increased Cost of Compliance coverage (Coverage D) is for the 
consequential loss brought on by a floodplain management ordinance or 
law affecting repair and reconstruction involving elevation, 
floodproofing, relocation, or demolition (or any combination thereof) of 
a structure, after a direct loss caused by a ``flood'' as defined by 
this policy. (Floodproofing activities eligible for Coverage D and 
referred to hereafter in this policy are limited to residential 
structures with basements that satisfy the criteria of 44 CFR 60.6 (b) 
or (c) and to non-residential structures.)
    The limit of liability under this Coverage D (Increased Cost of 
Compliance) will not exceed $15,000. This coverage is only applicable to 
policies with building coverage (Coverage A) and is in addition to the 
Building limit you selected on your application, and appears on the 
Declarations Page. No separate deductible applies. The maximum amount 
collectible under this policy for both Coverage A (Building Property) 
and Coverage D (Increased Cost of Compliance), however, cannot exceed 
the maximum permitted under the Act.
    Eligibility
    A structure covered under Coverage A--Building Property--sustaining 
a loss caused by a ``flood'' as defined by this policy must:
    1. Be a structure that is a repetitive loss structure. A repetitive 
loss structure means a

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structure, covered by a contract for flood insurance issued pursuant to 
the Act, that has incurred flood-related damage on 2 occasions during a 
10-year period ending on the date of the event for which a second claim 
is made, in which the cost of repairing the flood damage, on the 
average, equaled or exceeded 25% of the market value of the structure at 
the time of each such flood event. In addition to the current claim, the 
National Flood Insurance Program must have paid the previous qualifying 
claim, and the State or community must have a cumulative, substantial 
damage provision or repetitive loss provision in its flood plain 
management law or ordinance being enforced against the structure; or
    2. Be a structure that has had flood damage in which the cost to 
repair equals or exceeds 50% of the market value of the structure at the 
time of the flood event. The State or community must have a substantial 
damage provision in its floodplain management law or ordinance being 
enforced against the structure.
    This Coverage D will not pay for Increased Cost of Compliance to 
meet State or community floodplain management laws or ordinances which 
exceed the minimum criteria at 44 CFR 60.3, except as provided in 1. 
above or a. or b. as follows:
    a. elevation or floodproofing in any risk zone to preliminary or 
advisory base flood elevations provided by FEMA which the State or local 
government has adopted and is enforcing for flood-damaged structures in 
such areas. (This includes compliance activities in B, C, X, or D zones 
which are being changed to zones with base flood elevations. This also 
includes compliance activities in zones where base flood elevations are 
being increased, and a flood-damaged structure must comply with the 
higher advisory base flood elevation.) Increased Cost of Compliance 
coverage does not respond to situations in B, C, X, or D zones where the 
community has derived its own elevations and is enforcing elevation or 
floodproofing requirements for flood-damaged structures to elevations 
derived solely by the community.
    b. elevation or floodproofing above the base flood elevation to meet 
State or local ``freeboard'' requirements, i.e., that a structure must 
be elevated above the base flood elevation.
    Under the minimum NFIP criteria at 44 CFR 60.3(b)(4), States and 
communities must require the elevation or floodproofing of structures in 
unnumbered A zones to the base flood elevation where elevation data are 
obtained from a Federal, State, or other source. Such compliance 
activities are also eligible for this Coverage D.
    This coverage will also pay for the incremental cost, after 
demolition, or relocation, of elevating or floodproofing a structure 
during its rebuilding at the same or another site to meet State or local 
floodplain management laws or ordinances, subject to Exclusion (7).
    This coverage will also pay to bring a flood-damaged structure into 
compliance with State or local floodplain management laws or ordinances 
even if the structure had received a variance before the present loss 
from the applicable floodplain management requirements.
    Conditions
    (1) When a structure covered under Coverage A--Building Property--
sustains a loss caused by a ``flood'' as defined by this policy, our 
payment for the loss under this Coverage D will be for the increased 
cost to elevate, floodproof, relocate, demolish, or any combination 
thereof, caused by enforcement of current State or local floodplain 
management ordinances or laws. Our payment for eligible demolition 
activities will be for the cost to demolish and clear the site of the 
building or a portion thereof caused by enforcement of current State or 
local floodplain management ordinances or laws. Eligible activities for 
the cost of clearing the site will include those necessary to 
discontinue utility service to the site and ensure proper abandonment of 
on-site utilities.
    (2) When the building is repaired or rebuilt, it must be intended 
for the same occupancy as the present building unless otherwise required 
by current floodplain management ordinances or laws.
    Exclusions
    Under this Coverage D (Increased Cost of Compliance), we will not 
pay for:
    (1) The cost associated with enforcement of any floodplain 
management ordinance or law in communities participating in the 
Emergency Program.
    (2) The cost associated with enforcement of any ordinance or law 
that requires any insured or others to test for, monitor, clean up, 
remove, contain, treat, detoxify or neutralize, or in any way respond 
to, or assess the effects of pollutants. Pollutants include but are not 
limited to any solid, liquid, gaseous or thermal irritant or 
contaminant, including smoke, vapor, soot, fumes, acid, alkalis, 
chemicals and waste. Waste includes but is not limited to materials to 
be recycled, reconditioned or reclaimed.
    (3) The loss in value to any covered building or other structure due 
to the requirements of any ordinance or law.
    (4) The loss in residual value of the undamaged portion of a 
building demolished as a consequence of enforcement of any State or 
local floodplain management law or ordinance.
    (5) Any increased cost of compliance under this Coverage D:
    (a) Until the covered building is actually elevated, floodproofed, 
demolished or relocated on the same or to another premises; and

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    (b) Unless the covered building is elevated, floodproofed, 
demolished, or relocated as soon as reasonably possible after the loss, 
not to exceed two years.
    (6) For any code upgrade requirements, e.g., plumbing or electrical 
wiring, not specifically related to the State or local floodplain 
management law or ordinance.
    (7) For any compliance activities needed to bring additions or 
improvements made after the loss occurred into compliance with State or 
local floodplain management laws or ordinances.
    (8) Loss due to any ordinance or law that you were required to 
comply with before the current loss.
    (9) For any rebuilding activity to standards that do not meet the 
NFIP's minimum requirements. This includes any situation where the 
insured has received from the State or community a variance in 
connection with the current flood loss to rebuild the property to an 
elevation below the base flood elevation.
    (10) Increased cost of compliance for appurtenant structure(s).
    (11) For any structure insured under a Group Flood Insurance Policy 
issued pursuant to 44 CFR 61.17.
    (12) Assessments made by a condominium association on individual 
condominium unit owners to pay increased costs of repairing commonly 
owned buildings after a flood in compliance with State or local 
floodplain management ordinances or laws.
    Other Provisions
    (1) Increased Cost of Compliance coverage will not be included in 
the calculation to determine whether coverage meets the 80% insurance-
to-value requirement for replacement cost coverage under Article 8 or 
for payment under Article 3.B.3 for loss from land subsidence, sewer 
backup, or seepage of water.
    (2) All other conditions and provisions of the policy apply.

    Article 5--Special Provisions Applicable to Coverages A, B, and C

    A. Condominium unit owner coverage is excess over Association 
coverage. The insurance under this policy shall be excess over any 
insurance in the name of your Condominium Association covering the same 
property covered by this policy. Loss shall not be paid under ``Coverage 
A--Building Property'', paragraph B., and under ``Coverage B--Personal 
Property'' until we have verified the extent to which loss to 
improvements and personal property within your unit, and to the common 
elements of your building or any other building of your Condominium 
Association, is covered by any insurance in the name of your Condominium 
Association.
    Should the amount of insurance collectible under this policy for a 
loss, when combined with any recovery available to you as a tenant in 
common under any Condominium Association flood insurance policy provided 
under the Act for the same loss, exceed the statutorily permissible 
limits of building coverage available for the insuring of single-family 
dwellings under the Act, then the limits of building coverage under this 
policy shall be reduced in regard to that loss by the amount of such 
excess.
    B. This policy is not a valued policy. Loss will be paid, provided 
you have purchased a sufficient amount of coverage, i.e., in an amount 
equal to the lesser of the value of the damaged property under the terms 
and conditions of this policy (and regardless of whether the amount of 
insurance purchased is greater than such value) or the limit of coverage 
permitted under the Act.
    C. Insured Property, Covered Locations. Your dwelling and personal 
property are covered while the property is located:
    1. At the property address shown on the application or endorsement, 
if corrected by endorsement; and
    2. For 45 days, at another place above ground level or outside of 
the special hazard area, to which any of the insured property shall 
necessarily be removed by you in order to protect and preserve it from 
flood, due to the imminent danger of flood (provided, personal property 
so removed must be placed in a fully enclosed building or otherwise 
reasonably protected from the elements to be insured against loss), in 
which case the reasonable expenses incurred by you, including the value 
of your own labor and the labor of members of your household at 
prevailing Federal minimum wage rates, in moving any of your insured 
property temporarily away from the peril of flood shall be reimbursed to 
you in an amount not to exceed $500. This policy's deductible amounts, 
as provided for at Article 7, shall not be applied to this 
reimbursement.
    D. Coverage For Certain Loss Mitigation Measures. When the insurance 
under this policy covers a building, reasonable expenses incurred by you 
for the purchase of the following items are also covered, in an 
aggregate amount not to exceed $750.00:
    1. Sandbags, including sand to fill them and plastic sheeting and 
lumber used in connection with them;
    2. Fill for temporary levees;
    3. Pumps; and
    4. Wood;

all for the purpose of saving the building due to the imminent danger of 
a flood loss, including the value of your own labor and the labor of 
members of your household at prevailing Federal minimum wage rates.
    The policy's building deductible amount, as provided for at Article 
7, shall not be applied to this reimbursement.
    For reimbursement under this paragraph D. to apply, the following 
conditions must be met:

[[Page 264]]

    a. The insured property must be in imminent danger of sustaining 
flood damage; and
    b. The threat of flood damage must be of such imminence as to lead a 
person of common prudence to apprehend flood damage; and
    c. A general and temporary condition of flooding in the area must 
occur, even if the flooding does not reach the insured property, or a 
legally authorized official must issue an evacuation order or other 
civil order for the community in which the insured property is located 
calling for measures to preserve life and property from the peril of 
flood.

                     Article 6--Property Not Covered

    We do not cover any of the following:
    A. Valuables and commercial property, meaning:
    1. Accounts, bills, currency, deeds, evidences of debt, money, 
coins, medals, postage stamps, securities, bullion, manuscripts, other 
valuable papers or records, and personal property used in a business.
    2. Personal property used in connection with any incidental 
commercial occupancy or use of the building.
    B. Property over water or in the open, meaning:
    1. A building and personal property in the building located entirely 
in, on, or over water or seaward of mean high tide, if the building was 
newly constructed or substantially improved on or after October 1, 1982.
    2. Personal property in the open.
    C. Structures other than buildings, including:
    1. Fences, retaining walls, seawalls, bulkheads, wharves, piers, 
bridges, and docks.
    2. Indoor and outdoor swimming pools.
    3. Open structures and personal property located in, on, or over 
water, including boat houses or any structure or building into which 
boats are floated.
    4. Underground structures and equipment, including wells, septic 
tanks and septic systems.
    D. Other real property, including:
    1. Land, land values, lawns, trees, shrubs, plants, and growing 
crops.
    2. Those portions of walks, walkways, decks, driveways, patios, and 
other surfaces, all whether covered or not and all of whatever kind of 
construction, located outside the perimeter, exterior walls of the 
insured building or unit.
    E. Other personal property, meaning:
    1. Animals, livestock, birds, and fish.
    2. Aircraft.
    3. Any self-propelled vehicle or machine and motor vehicle (other 
than motorized equipment pertaining to the service of the described unit 
or building, operated principally on your premises, and not licensed for 
highway use) including their parts and equipment.
    4. Trailers on wheels and other recreational vehicles whether 
affixed to a permanent foundation or on wheels.
    5. Watercraft including their furnishings and equipment.
    F. Basements, building enclosures lower than the elevated floors of 
elevated buildings, and personal property, as follows:
    1. In a special hazard area, at an elevation lower than the lowest 
elevated floor of an elevated Post-FIRM building, including a 
manufactured (i.e., mobile) home:
    a. Personal property.
    b. Building enclosures, equipment, machinery, fixtures and 
components, except for the required utility connections and the 
footings, foundation, posts, pilings, piers or other foundation walls 
and anchorage system as required for the support of the building.
    2. In a basement as defined in Article 2:
    a. Personal property.
    b. Building equipment, machinery, fixtures and components, including 
finished walls, floors, ceilings and other improvements, except for the 
required utility connections, fiberglass insulation, drywalls and 
sheetrock walls, and ceilings but only to the extent of replacing 
drywalls and sheetrock walls in an unfinished manner (i.e., nailed to 
framing but not taped, painted, or covered).
    3. Provided, with regard to both 1. and 2., except for the case of a 
dwelling unit in a condominium building as to which the Association's 
coverage is sufficient to cover such property, the following building 
and personal property items connected to a power source and installed in 
their functioning location are covered so long as you have purchased 
building and personal property coverage, as appropriate:
     Sump pumps
     Well water tanks and pumps
     Oil tanks and the oil in them
     Cisterns and the water in them
     Natural gas tanks and the gas in them
     Pumps and or tanks used in conjunction with solar energy
     Furnaces
     Hot water heaters
     Clothes washers and dryers
     Food freezers and the food in them
     Air conditioners
     Heat pumps
     Electrical junction and circuit breaker boxes
     Clean-up
     Stairways and staircases attached to the building which are 
not separated from the building by elevated walkways.
     Elevators, dumbwaiters, and relevant equipment, except for 
such relevant equipment located below the base flood elevation if such 
relevant equipment was installed on or after October 1, 1987.
    G. Property below ground, meaning a building or unit and its 
contents, including personal

[[Page 265]]

property and machinery and equipment, which are part of the building or 
unit, where more than 49 percent of the actual cash value of such 
building or unit is below ground, unless the lowest level is at or above 
the base flood elevation (in the Regular Program) or the adjacent ground 
level (in the Emergency Program) by reason of earth having been used as 
an insulation material in conjunction with energy efficient building 
techniques.
    H. Certain manufactured homes, meaning a manufactured (i.e., mobile) 
home located or placed within a FEMA designated Special Hazard Area that 
is not anchored to a permanent foundation to resist flotation, collapse, 
or lateral movement:
    1. By over-the-top or frame ties to ground anchors; or
    2. In accordance with manufacturer's specifications; or
    3. In compliance with the community's floodplain management 
requirements;

unless it is a manufactured (i.e., mobile) home on a permanent 
foundation continuously insured by the National Flood Insurance Program 
at the same site at least since September 30, 1982.
    I. Containers such as but not limited to gas tanks or liquid tanks.
    J. Buildings and their contents made ineligible for flood insurance 
pursuant to the provisions of the Coastal Barrier Resources Act, 16 
U.S.C. 3501 et seq., and the Coastal Barrier Improvement Act of 1990, 
Pub. L. 101-591, 16 U.S.C. 3501 et seq.

                         Article 7--Deductibles

    A. Each loss to your insured property is subject to a deductible 
provision under which you bear a portion of the loss before payment is 
made under the policy.
    B. The loss deductible shall apply separately to each building and 
personal property loss including, as to each, any appurtenant structure 
loss and debris removal expense.
    C. For any flood insurance policy issued or renewed for a property 
located in an Emergency Program community or for any property located in 
a Regular Program community in Zones A, AO, AH, A1-30, AE, VO, V1-30, 
VE, or V where the rates available for buildings built before the 
effective date of the initial Flood Insurance Rate Map or December 31, 
1974, whichever is later, are used to compute the premium, the amount of 
the deductible for each loss occurrence is determined as follows: We 
shall be liable only when such loss exceeds $750.00, or the amount of 
any higher deductible which you selected when you applied for this 
policy or subsequently by endorsement.
    D. For policies other than those described in paragraph C. above, 
the amount of the deductible for each loss occurrence is determined as 
follows: We shall be liable only when such loss exceeds $500.00, or the 
amount of any higher deductible which you selected when you applied for 
this policy or subsequently by endorsement.
    E. Notwithstanding the applicable deductible in paragraphs C. or D. 
above, an additional deductible in the sum of $250.00 shall apply 
separately to each building and contents loss before payment is made 
under the policy for land subsidence, sewer backup, or seepage of water 
as provided for in Article 3, paragraph B.3.

                 Article 8--Replacement Cost Provisions

    Subject to Article 7 and the limits of building coverage you have 
purchased, these provisions shall apply only to a single family dwelling 
which is your principal residence and which is covered under this 
policy.
    For purposes of this Article 8, a single family dwelling qualifies 
as your principal residence provided that, at the time of the loss, you 
or your spouse have lived in your building for either:
    1. 80 percent of the calendar year immediately preceding the loss; 
or
    2. 80 percent of the period of your ownership of the insured 
building, if less than one calendar year immediately preceded the loss.
    The following are excluded from replacement cost coverage:
    1. A unit, in a condominium building, not used exclusively for 
single family dwelling purposes.
    2. Outdoor antennas and aerials, awnings, and other outdoor 
equipment, all whether attached to the building or not.
    3. Carpeting.
    4. Appliances.
    Under this Article:
    A. If at the time of loss the total amount of insurance applicable 
to the dwelling is 80 percent or more of the full replacement cost of 
such dwelling, or is the maximum amount of insurance available under the 
National Flood Insurance Program, the coverage of this policy applicable 
to the dwelling is extended to include the full cost of repair or 
replacement (without deduction for depreciation).
    B. If at the time of loss the total amount of insurance applicable 
to the dwelling is less than 80 percent of the full replacement cost of 
such dwelling and less than the maximum amount of insurance available 
under the National Flood Insurance Program, our liability for loss shall 
not exceed the larger of the following amounts:
    1. The actual cash value (meaning replacement cost less 
depreciation) of that part of the dwelling damaged or destroyed; or
    2. That portion of the full cost of repair or replacement without 
deduction for depreciation of that part of the dwelling damaged or 
destroyed, which the total amount of insurance applicable to the 
dwelling bears to 80 percent of the full replacement cost of such 
dwelling.

[[Page 266]]

    If 80 percent of the full replacement cost of such dwelling is 
greater than the maximum amount of insurance available under the 
National Flood Insurance Program, use the maximum amount in lieu of the 
80 percent figure in the application of this limit.
    C. Our liability for loss under this policy shall not exceed the 
smallest of the following amounts:
    1. The limit of liability of this policy applicable to the damaged 
or destroyed building; or
    2. The replacement cost of the dwelling or any part thereof 
identical with such dwelling on the same premises and intended for the 
same occupancy and use; or
    3. The amount actually and necessarily expended in repairing or 
replacing said dwelling or any part thereof intended for the same 
occupancy and use.
    D. When the full cost of repair or replacement is more than $1,000 
or more than 5 percent of the whole amount of insurance applicable to 
said dwelling, we shall not be liable for any loss under paragraph A. or 
subparagraph B.2. of these provisions unless and until actual repair or 
replacement is completed.
    E. In determining if the whole amount of insurance applicable to 
said dwelling is 80 percent or more of the full replacement cost of such 
dwelling, the cost of excavations, underground flues and pipes, 
underground wiring and drains, and brick, stone and concrete 
foundations, piers and other supports which are below the under surface 
of the lowest basement floor, or where there is no basement, which are 
below the surface of the ground inside the foundation walls, shall be 
disregarded.
    F. You may elect to disregard this condition in making claim 
hereunder, but such election shall not prejudice your right to make 
further claim within 180 days after loss for any additional liability 
brought about by these provisions.
    G. These Replacement Cost Provisions do not apply to any 
manufactured (i.e., mobile) home which when assembled is not at least 16 
feet wide or does not have an area within its perimeter walls of at 
least 600 square feet or personal property (contents) covered under this 
policy, nor do they apply to any loss where insured property is 
abandoned and remains as debris at the property address following a 
loss.
    H. If your dwelling sustains a total loss or if we should pay you 
the entire building loss proceeds under these Replacement Cost 
Provisions, there is no requirement that you rebuild the building at the 
insured property address.
    I. If the community in which your property is located has been 
converted from the Emergency Program to the Regular Program during the 
current policy term, then these Replacement Cost Provisions shall be 
applied based on the maximum amount of insurance available under the 
National Flood Insurance Program at the beginning of the current policy 
term instead of at the time of loss.

              Article 9--General Conditions and Provisions

    A. Pair and Set Clause: If you lose an article which is part of a 
pair or set, we will have the option of paying you an amount equal to 
the cost of replacing the lost article, less depreciation, or an amount 
which represents the fair proportion of the total value of the pair or 
set that the lost article bears to the pair or set.
    B. Concealment, Fraud: We will not cover you under this policy, 
which shall be void, nor can this policy be renewed or any new flood 
insurance coverage be issued to you if:
    1. You have sworn falsely, or willfully concealed or misrepresented 
any material fact; or
    2. You have done any fraudulent act concerning this insurance (see 
paragraph F.1.d. below); or
    3. You have willfully concealed or misrepresented any fact on a 
``Recertification Questionnaire,'' which causes us to issue a policy to 
you based on a premium amount which is less than the premium amount 
which would have been payable by you were it not for the misstatement of 
fact (see paragraph G. below).
    C. Other Insurance. If a loss covered by this policy is also covered 
by other insurance whether collectible or not, except insurance in the 
name of the Condominium Association issued pursuant to the Act, we will 
pay only the proportion of the loss that the limit of liability that 
applies under this policy bears to the total amount of insurance 
covering the loss.
    If there is other insurance in the name of the Condominium 
Association covering the same property covered by this policy, this 
insurance shall be excess over the other insurance.
    D. Amendments, Waivers, Assignment: This policy cannot be amended 
nor can any of its provisions be waived without the express written 
consent of the Federal Insurance Administrator. No action we take under 
the terms of this policy can constitute a waiver of any of our rights. 
Except in the case of 1. a contents only policy, and 2. a policy issued 
to cover a building in the course of construction, assignment of this 
policy, in writing, is allowed upon transfer of title.
    E. Cancellation of Policy By You:
    You may cancel this policy at any time but a refund of premium money 
will only be made to you when:
    1. You cancel because you have transferred ownership of the 
described building or unit to someone else. In this case, we will refund 
to you, once we receive your written request for cancellation (signed by 
you), the excess of

[[Page 267]]

premiums paid by you which apply to the unused portion of the policy's 
term, pro rata but with retention of the expense constant and the 
Federal policy fee.
    2. You cancel a policy having a term of 3 years, on an anniversary 
date, and the reason for the cancellation is:
    a. A policy of flood insurance has been obtained or is being 
obtained in substitution for this policy and we have received a written 
concurrence in the cancellation from any mortgagee of which we have 
actual notice; or
    b. You have extinguished the insured mortgage debt and are no longer 
required by the mortgagee to maintain the coverage.
    Refund of any premium, under this subparagraph 2., shall be pro rata 
but with retention of the expense constant and the Federal policy fee.
    3. You cancel because we have determined that your property is not, 
in fact, in a special hazard area; and you were required to purchase 
flood insurance coverage by a private lender or Federal agency pursuant 
to the Act; and the lender or Federal agency no longer requires the 
retention by you of the coverage. In this event, if no claims have been 
paid or are pending, your premium payments will be refunded to you in 
full, according to our applicable regulations.
    F. Voidance, Reduction or Reformation of the Coverage By Us:
    1. Voidance: This policy shall be void and of no legal force and 
effect in the event that any one of the following conditions occurs:
    a. The property listed on the application is not eligible for 
coverage, in which case the policy is void from its inception;
    b. The community in which the property is located was not 
participating in the National Flood Insurance Program on the policy's 
inception date and did not qualify as a participating community during 
the policy's term and before the occurrence of any loss for which you 
may receive compensation under the policy;
    c. If, during the term of the policy, the participation in the 
National Flood Insurance Program of the community in which your property 
is located ceases, in which case the policy shall be deemed void 
effective at the end of the last day of the policy year in which such 
cessation occurred and shall not be renewed.
    In the event the voided policy included 3 policy years in a contract 
term of 3 years, you shall be entitled to a pro rata refund of any 
premium applicable to the remainder of the policy's term;
    d. In the event you or your agent have:
    (1) Sworn falsely, or
    (2) Fraudulently or willfully concealed or misrepresented any 
material fact including facts relevant to the rating of this policy in 
the application for coverage, or upon any renewal of coverage, or in 
connection with the submission of any claim brought under the policy, in 
which case this entire policy shall be void as of the date the wrongful 
act was committed or from its inception if this policy is a renewal 
policy and the wrongful act occurred in connection with an application 
for or renewal or endorsement of a policy issued to you in a prior year 
and affects the rating of or premium amount received for this policy. 
Refunds of premiums, if any, shall be subject to offsets for our 
administrative expenses (including the payment of agent's commissions 
for any voided policy year) in connection with the issuance of the 
policy;
    e. The premium you submit is less than the minimum set forth in 44 
CFR 61.10 in connection with any application for a new policy or policy 
renewal, in which case the policy is void from its inception date.
    2. Reduction of Coverage Limits or Reformation: In the event that 
the premium payment received by us is not sufficient (whether evident or 
not) to purchase the amount of coverage requested by an application, 
renewal, endorsement, or other form and paragraph F.1.d. does not apply, 
then the policy shall be deemed to provide only such coverage as can be 
purchased for the entire term of the policy, for the amount of premium 
received, subject to increasing the amount of coverage pursuant to 44 
CFR 61.11; provided, however:
    a. If the insufficient premium is discovered by us prior to a loss 
and we can determine the amount of insufficient premium from information 
in our possession at the time of our discovery of the insufficient 
premium, we shall give a notice of additional premium due, and if you 
remit and we receive the additional premium required to purchase the 
limits of coverage for each kind of coverage as was initially requested 
by you within 30 days from the date we give you written notice of 
additional premium due, the policy shall be reformed, from its inception 
date, or, in the case of an endorsement, from the effective date of the 
endorsement, to provide flood insurance coverage in the amount of 
coverage initially requested.
    b. If the insufficient premium is discovered by us at the time of a 
loss under the policy, we shall give a notice of premium due, and if you 
remit and we receive the additional premium required to purchase (for 
the current policy term and the previous policy term, if then insured) 
the limits of coverage for each kind of coverage as was initially 
requested by you within 30 days from the date we give you written notice 
of additional premium due, the policy shall be reformed, from its 
inception date, or, in the case of an endorsement, from the effective 
date of the endorsement, to provide flood insurance coverage in the 
amount of coverage initially requested.
    c. Under subparagraphs a. and b. as to any mortgagee or trustee 
named in the policy, we shall give a notice of additional premium due 
and the right of reformation shall continue in force for the benefit 
only of the

[[Page 268]]

mortgagee or trustee, up to the amount of your indebtedness, for 30 days 
after written notice to the mortgagee or trustee.
    G. Policy Renewal: The term of this policy commences on its 
inception date and ends on its expiration date, as shown on the 
declarations page which is attached to the policy. We are under no 
obligation to:
    1. Send you any renewal notice or other notice that your policy term 
is coming to an end and the receipt of any such notice by you shall not 
be deemed to be a waiver of this provision on our part.
    2. Assure that policy changes reflected in endorsements submitted by 
you during the policy term and accepted by us are included in any 
renewal notice or new policy which we send to you. Policy changes 
includes the addition of any increases in the amounts of coverage.
    This policy shall not be renewed and the coverage provided by it 
shall not continue into any successive policy term unless the renewal 
premium payment is received by us at the office of the National Flood 
Insurance Program within 30 days of the expiration date of this policy, 
subject to Article 9, paragraph F. above. If the renewal premium payment 
is mailed by certified mail to the National Flood Insurance Program 
prior to the expiration date, it shall be deemed to have been received 
within the required 30 days. The coverage provided by the renewal policy 
is in effect for any loss occurring during this 30-day period even if 
the loss occurs before the renewal premium payment is received, so long 
as the renewal premium payment is received within the required 30 days. 
In all other cases, this policy shall terminate as of the expiration 
date of the last policy term for which the premium payment was timely 
received at the office of the National Flood Insurance Program and, in 
that event, we shall not be obligated to provide you with any 
cancellation, termination, policy lapse, or policy renewal notice.
    In connection with the renewal of this policy, you may be requested 
during the policy term to recertify, on a Recertification Questionnaire 
we will provide you, the rating information used to rate your most 
recent application for or renewal of insurance.
    Notwithstanding your responsibility to submit the appropriate 
renewal premium in sufficient time to permit its receipt by us prior to 
the expiration of the policy being renewed, we have established a 
business procedure for mailing renewal notices to assist Insureds in 
meeting their responsibility. Regarding our business procedure, evidence 
of the placing of any such notices into the U.S. Postal Service, 
addressed to you at the address appearing on your most recent 
application or other appropriate form (received by the National Flood 
Insurance Program prior to the mailing of the renewal notice by us), 
does, in all respects for purposes of the National Flood Insurance 
Program, presumptively establish delivery to you for all purposes 
irrespective of whether you actually received the notice.
    However, in the event we determine that, through any circumstances, 
any renewal notice was not placed into the U.S. Postal Service, or, if 
placed, was prepared or addressed in a manner which we determine could 
preclude the likelihood of its being actually and timely received by you 
prior to the due date for the renewal premium, the following procedures 
shall be followed:
    In the event that you or your agent notified us, not later than 1 
year after the date on which the payment of the renewal was due, of a 
nonreceipt of a renewal notice prior to the due date for the renewal 
premium, which we determine was attributable to the above circumstance, 
we shall mail a second bill providing a revised due date, which shall be 
30 days after the date on which the bill is mailed.
    If the renewal payment requested by reason of the second bill is not 
received by the revised due date, no renewal shall occur and the policy 
shall remain as an expired policy as of the expiration date prescribed 
on the policy.
    H. Conditions Suspending or Restricting Insurance: Unless otherwise 
provided in writing added hereto, we shall not be liable for loss 
occurring while the hazard is increased by any means within your control 
or knowledge.
    I. Alterations and Repairs: You may, at any time and at your own 
expense, make alterations, additions and repairs to the insured 
property, and complete structures in the course of construction.
    J. Requirements in Case of Loss: Should a flood loss occur to your 
insured property, you must:
    1. Notify us in writing as soon as practicable;
    2. As soon as reasonably possible, separate the damaged and 
undamaged property, putting it in the best possible order so that we may 
examine it; and
    3. Within 60 days after the loss, send us a proof of loss, which is 
your statement as to the amount you are claiming under the policy signed 
and sworn to by you and furnishing us with the following information:
    a. The date and time of the loss;
    b. A brief explanation of how the loss happened;
    c. Your interest in the property damaged (for example, ``owner'') 
and the interest, if any, of others in the damaged property;
    d. The actual cash value or replacement cost, whichever is 
appropriate, of each damaged item of insured property and the amount of 
damages sustained;
    e. Names of mortgagees or anyone else having a lien, charge or claim 
against the insured property;

[[Page 269]]

    f. Details as to any other contracts of insurance covering the 
property, whether valid or not;
    g. Details of any changes in ownership, use, occupancy, location or 
possession of the insured property since the policy was issued;
    h. Details as to who occupied any insured building at the time of 
loss and for what purpose; and
    i. The amount you claim is due under this policy to cover the loss, 
including statements concerning:
    (1) The limits of coverage stated in the policy; and
    (2) The cost to repair or replace the damaged property (whichever 
costs less).
    4. Cooperate with our adjuster or representative in the 
investigation of the claim;
    5. Document the loss with all bills, receipts, and related documents 
for the amount being claimed;
    6. The insurance adjuster whom we hire to investigate your claim may 
furnish you with a proof of loss form, and she or he may help you to 
complete it. However, this is a matter of courtesy only, and you must 
still send us a proof of loss within 60 days after the loss even if the 
adjuster does not furnish the form or help you complete it.
    In completing the proof of loss, you must use your own judgment 
concerning the amount of loss and the justification for that amount.
    The adjuster is not authorized to approve or disapprove claims or 
tell you whether your claim will be approved by us.
    7. We may, at our option, waive the requirement for the completion 
and filing of a proof of loss in certain cases, in which event you will 
be required to sign and, at our option, swear to an adjuster's report of 
the loss which includes information about your loss and the damages 
sustained, which is needed by us in order to adjust your claim.
    8. Any false statements made in the course of presenting a claim 
under this policy may be punishable by fine or imprisonment under the 
applicable Federal Laws.
    K. Our Options After a Loss: Options we may, in our sole discretion, 
exercise after loss include the following:
    1. Evidence of Loss: If we specifically request it, in writing, you 
may be required to furnish us with a complete inventory of the 
destroyed, damaged and undamaged property, including details as to 
quantities, costs, actual cash values or replacement cost (whichever is 
appropriate), amounts of loss claimed, and any written plans and 
specifications for repair of the damaged property which you can make 
reasonably available to us.
    2. Examination Under Oath and Access to Insured Property Ownership 
Records and Condominium Documents: We may require you to:
    a. Show us, or our designee, the damaged property, to be examined 
under oath by our designee and to sign any transcripts of such 
examinations; and
    b. At such reasonable times and places as we may designate, permit 
us to examine and make extracts and copies of any policies of property 
insurance insuring you against loss; and the deed establishing your 
ownership of the insured real property; and the condominium documents 
including the Declarations of the condominium, its Articles of 
Association or Incorporation, Bylaws, rules and regulations, and other 
condominium documents if you are a unit owner in a condominium building; 
and all books of accounts, bills, invoices and other vouchers, or 
certified copies thereof if the originals are lost, pertaining to the 
damaged property.
    3. Options to Replace: We may take all or any part of the damaged 
property at the agreed or appraised value and, also, repair, rebuild or 
replace the property destroyed or damaged with other of like kind and 
quality within a reasonable time, on giving you notice of our intention 
to do so within 30 days after the receipt of the proof of loss herein 
required under paragraph J.3. above.
    4. Adjustment Options: We may adjust loss to any insured property of 
others with the owners of such property or with you for their account. 
Any such insurance under this policy shall not inure directly or 
indirectly to the benefit of any carrier or other bailee for hire.
    L. When Loss Payable: Loss is payable within 60 days after you file 
your proof of loss (or within 90 days after the insurance adjuster files 
an adjuster's report signed and sworn to by you in lieu of a proof of 
loss) and ascertainment of the loss is made either by agreement between 
us and you expressed in writing or by the filing with us of an award as 
provided in paragraph N. below.
    If we reject your proof of loss in whole or in part, you may accept 
such denial of your claim, or exercise your rights under this policy, or 
file an amended proof of loss as long as it is filed within 60 days of 
the date of the loss or any extension of time allowed by the 
Administrator.
    M. Abandonment: You may not abandon damaged or undamaged insured 
property to us.
    However, we may permit you to keep damaged, insured property 
(``salvage'') after a loss and we will reduce the amount of the loss 
proceeds payable to you under the policy by the value of the salvage.
    N. Appraisal: If at any time after a loss, we are unable to agree 
with you as to the actual cash value or, if applicable, replacement cost 
of the damaged property so as to determine the amount of loss to be paid 
to you, then, on the written demand of either one of us, each of us 
shall select a competent and disinterested appraiser and notify the 
other of the appraiser selected within 20 days of such demand. The 
appraisers shall first select a

[[Page 270]]

competent and disinterested umpire; and failing, after 15 days, to agree 
upon such umpire, then, on your request or our request, such umpire 
shall be selected by a judge of a court of record in the State in which 
the insured property is located. The appraisers shall then appraise the 
loss, stating separately replacement cost, actual cash value and loss to 
each item; and, failing to agree, shall submit their differences, only, 
to the umpire. An award in writing, so itemized, of any two (appraisers 
or appraiser and umpire) when filed with us shall determine the amount 
of actual cash value and loss or, should this policy's replacement cost 
provisions apply, the amount of replacement cost and loss. Each 
appraiser shall be paid by the party selecting him or her and the 
expenses of appraisal and umpire shall be paid by both of us equally.
    O. Loss Clause: If we pay you for damage to property sustained in a 
flood loss, you are still eligible, during the term of the policy, to 
collect for a subsequent loss due to another flood. Of course, all loss 
arising out of a single, continuous flood of long duration shall be 
adjusted as one flood loss.
    P. Mortgage Clause: (Applicable to building coverage only and 
effective only when the policy is made payable to a mortgagee or trustee 
named in the application and declarations page attached to this policy 
or of whom we have actual notice prior to the payment of loss proceeds 
under this policy).
    Loss, if any, under this policy, shall be payable to the aforesaid 
as mortgagee or trustee as interest may appear under all present or 
future mortgages upon the property described in which the aforesaid may 
have an interest as mortgagee or trustee, in order of precedence of said 
mortgages, and this insurance, as to the interest of the mortgagee or 
trustee only therein, shall not be invalidated by any act or neglect of 
the mortgagor or owner of the described property, nor by any foreclosure 
or other proceedings or notice of sale relating to the property, nor by 
any change in the title or ownership of the property, nor by the 
occupation of the premises for purposes more hazardous than are 
permitted by this policy; provided, that in case the mortgagor or owner 
shall neglect to pay any premium due under this policy, the mortgagee or 
trustee shall, on demand, pay the same.
    Provided, also, that the mortgagee or trustee shall notify us of any 
change of ownership or occupancy or increase of hazard which shall come 
to the knowledge of said mortgagee or trustee and, unless permitted by 
this policy, it shall be noted thereon and the mortgagee or trustee 
shall, on demand, pay the premium for such increased hazard for the term 
of the use thereof; otherwise, this policy shall be null and void.
    If this policy is cancelled by us, it shall continue in force for 
the benefit only of the mortgagee or trustee for 30 days after written 
notice to the mortgagee or trustee of such cancellation and shall then 
cease, and we shall have the right, on like notice, to cancel this 
agreement.
    Whenever we shall pay the mortgagee or trustee any sum for loss 
under this policy and shall claim that, as to the mortgagor or owner, no 
liability therefor existed, we shall, to the extent of such payment, be 
thereupon legally subrogated to all the rights of the party to whom such 
payment shall be made, under all securities held as collateral to the 
mortgage debt, or may, at our option, pay to the mortgagee or trustee 
the whole principal due or to grow due on the mortgage with interest, 
and shall thereupon receive a full assignment and transfer of the 
mortgage and of all such other securities; but no subrogation shall 
impair the right of the mortgagee or trustee to recover the full amount 
of said mortgagee's or trustee's claim.
    Q. Mortgagee Obligations: If you fail to render proof of loss, the 
named mortgagee or trustee, upon notice, shall render proof of loss in 
the form herein specified within 60 days thereafter and shall be subject 
to the provisions of this policy relating to appraisal and time of 
payment and of bringing suit.
    R. Conditions for Filing a Lawsuit: You may not sue us to recover 
money under this policy unless you have complied with all the 
requirements of the policy. If you do sue, you must start the suit 
within 12 months from the date we mailed you notice that we have denied 
your claim, or part of your claim, and you must file the suit in the 
United States District Court of the district in which the insured 
property was located at the time of loss.
    S. Subrogation: Whenever we make a payment for a loss under this 
policy, we are subrogated to your right to recover for that loss from 
any other person. That means that your right to recover for a loss that 
was partly or totally caused by someone else is automatically 
transferred to us, to the extent that we have paid you for the loss. We 
may require you to acknowledge this transfer in writing. After the loss, 
you may not give up our right to recover this money or do anything which 
would prevent us from recovering it. If you make any claim against any 
person who caused your loss and recover any money, you must pay us back 
first before you may keep any of that money.
    T. Continuous Lake Flooding: Where the insured building has been 
inundated by rising lake waters continuously for 90 days or more and it 
appears reasonably certain that a continuation of this flooding will 
result in damage, reimbursable under this policy, to the insured 
building equal to or greater than the building policy limits plus the 
deductible(s) or the maximum payable under the policy for any one 
building loss, we will pay you the lesser of these two amounts without 
waiting

[[Page 271]]

for the further damage to occur if you sign a release agreeing:
    1. To make no further claim under this policy;
    2. Not to seek renewal of this policy; and
    3. Not to apply for any flood insurance under the Act for property 
at the property location of the insured building.
    If the policy term ends before the insured building has been flooded 
continuously for 90 days, the provisions of this paragraph T. still 
apply so long as the first building damage reimbursable under this 
policy from the continuous flooding occurred before the end of the 
policy term.
    U. Duplicate Policies Not Allowed: Property may not be insured under 
more than one policy issued under the Act. When we find that duplicate 
policies are in effect, we shall by written notice give you the option 
of choosing which policy is to remain in effect under the following 
procedures:
    1. If you choose to keep in effect the policy with the earlier 
effective date, we shall by the same written notice give you an 
opportunity to add the coverage limits of the later policy to those of 
the earlier policy, as of the effective date of the later policy.
    2. If you choose to keep in effect the policy with the later 
effective date, we shall by the same written notice give you the 
opportunity to add the coverage limits of the earlier policy to those of 
the later policy, as of the effective date of the later policy.
    In either case, you must pay the pro rata premium for the increased 
coverage limits within 30 days of the written notice. In no event shall 
the resulting coverage limits exceed the statutorily permissible limits 
of coverage under the Act or your insurable interests, whichever is 
less.
    We shall make a refund to you, according to applicable National 
Flood Insurance Program rules, of the premium for the policy not being 
kept in effect. For purposes of this paragraph U., the term effective 
date means the date coverage that has been in effect without any lapse 
was first placed in effect.
    In addition to the provisions of this paragraph U. for increasing 
policy limits, the usual procedures for increasing policy limits, by 
mid-term endorsement or at renewal time, with the appropriate waiting 
period, are applicable to the policy you choose to keep in effect.

                    Article 10--Liberalization Clause

    If during the period that insurance is in force under this policy or 
within 45 days prior to the inception date thereof, should we have 
adopted under the Act, any forms, endorsements, rules or regulations by 
which this policy could be extended or broadened, without additional 
premium charge, by endorsement or substitution of form, then, such 
extended or broadened insurance shall inure to your benefit as though 
such endorsement or substitution of form had been made. Any broadening 
or extension of this policy to your benefit shall only apply to losses 
occurring on or after the effective date of the adoption of any forms, 
endorsements, rules or regulations affecting this policy.

                      Article 11--What Law Governs

    This policy is governed by the flood insurance regulations issued by 
FEMA, the National Flood Insurance Act of 1968, as amended (42 U.S.C. 
4001, et seq.) and Federal common law.
    In witness whereof, we have signed this policy below and hereby 
enter into this Insurance Agreement.

                                                        James L. Witt,  
                          Director, Federal Emergency Management Agency.
    (The information required under the terms of this policy has been 
approved by the Office of Management and Budget under OMB control number 
3067-0021.)

[58 FR 62424, Nov. 26, 1993, as amended at 62 FR 8397, Feb. 25, 1997]

                        Appendix A(2) to Part 61

  Federal Emergency Management Agency, Federal Insurance Administration

                     Standard Flood Insurance Policy

[Issued Pursuant to the National Flood Insurance Act of 1968, or Any 
Acts Amendatory Thereof (Hereinafter Called the Act), and Applicable 
Federal Regulations in Title 44 of the Code of Federal Regulations, 
Subchapter B]

                          General Property Form

    Read the policy carefully. The coverage provided is subject to 
limitations, restrictions and exclusions.
    This policy provides no coverage:
    1. In a regular program community, for a residential condominium 
building, as defined in this policy; and
    2. Except for personal property coverage, for a unit in a 
condominium building.

                           Insuring Agreement

    Agreement of Insurance between the Federal Emergency Management 
Agency (FEMA), as Insurer, and the Insured.
    The Insurer insures the Insured against all Direct physical loss by 
or from flood to the insured property, based upon:
    1. The Insured having paid the correct amount of premium; and
    2. The Insurer's reliance on the accuracy of the information and 
statements the Insured has furnished; and
    3. All the terms of this policy, the National Flood Insurance Act of 
1968, as amended, and Title 44 of the Code of Federal Regulations.

[[Page 272]]

    On this basis, the Insured is insured up to the lesser of:
    1. The actual cash value, not including any antique value, of the 
property at the time of loss; or
    2. The amount it would cost to repair or replace the property with 
material of like kind and quality within a reasonable time after the 
loss.

                       Article 1--Persons Insured

    The following are insured under this policy:
    A. The named Insured and legal representatives;
    B. Any mortgagee and trustee named in the application and 
declarations page, as well as any other mortgagee or loss payee 
determined to exist at the time of a loss (See Article 8, paragraph L.), 
in the order of precedence and to the extent of their interest but for 
no more, in the aggregate, than the interest of the named Insured.

                         Article 2--Definitions

    As used in this policy:
    Act means the National Flood Insurance Act of 1968 and any acts 
amendatory thereof.
    Actual Cash Value means the replacement cost of an insured item of 
property at the time of loss, less the value of physical depreciation as 
to the item damaged.
    Application means the statement made and signed by the Insured, or 
the Insured's agent, and giving information on the basis of which the 
Insurer determines the acceptability of the risk, the policy to be 
issued and the correct premium payment, which must accompany the 
application in order for the policy to be issued. The application is a 
part of this flood insurance policy.
    Association means the group of unit owners which manages the 
described Condominium Building.
    Base flood means the flood having a one percent chance of being 
equalled or exceeded in any given year.
    Basement means any area of the building, including any sunken room 
or sunken portion of a room, having its floor subgrade (below ground 
level) on all sides.
    Building means a walled and roofed structure, other than a gas or 
liquid storage tank, that is principally above ground and affixed to a 
permanent site, including a walled and roofed building in the course of 
construction, alteration or repair and a manufactured (i.e., mobile) 
home on a permanent foundation, subject to Article 6, paragraph H.
    Cancellation means that ending of the insurance coverage provided by 
this policy prior to the expiration date.
    Coastal High Hazard Area means an area subject to high velocity 
waters, including hurricane wave wash and tsunamis.
    Condominium means a system of individual ownership of units in a 
multi-unit building or buildings or in single-unit buildings as to which 
each unit owner in the condominium has an undivided interest in the 
common areas of the building(s) and facilities that serve the 
building(s).
    Declarations Page is a computer generated summary of information 
furnished by the Insured in the application for insurance. The 
declarations page also describes the term of the policy, limits of 
coverage, and displays the premium and the name of the Insurer. The 
declarations page is a part of this flood insurance policy.
    Direct Physical Loss By or From Flood means any loss in the nature 
of actual loss of or physical damage, evidenced by physical changes, to 
the insured property (building or personal property) which is directly 
and proximately caused by a ``flood'' (as defined in this policy).
    Elevated Building means a non-basement building which has its lowest 
elevated floor raised above ground level by foundation walls, shear 
walls, posts, piers, pilings, or columns.
    Emergency Program Community means a community wherein a Flood Hazard 
Boundary Map (FHBM) is in effect and only limited amounts of insurance 
are available under the Act.
    Expense Constant means a flat charge per policy term, paid by the 
Insured to defray the Federal Government's policywriting and other 
expenses.
    Expiration Date means the ending of the insurance coverage provided 
by this policy on the expiration date shown on the declarations page.
    Federal policy fee means a flat charge per policy term, paid by the 
Insured to defray certain administrative expenses incurred in carrying 
out the National Flood Insurance Program not covered by the expense 
constant. This fee was established by section 1307(a)(1)(B)(iii) of the 
National Flood Insurance Act of 1968, as amended, and is not subject to 
producers' commissions, expense allowances, or state or local premium 
taxes.
    Flood means:
    A. A general and temporary condition of partial or complete 
inundation of normally dry land areas from:
    1. The overflow of inland or tidal waters.
    2. The unusual and rapid accumulation or runoff of surface waters 
from any source.
    3. Mudslides (i.e., mudflows) which are proximately caused by 
flooding as defined in subparagraph A-2 above and are akin to a river of 
liquid and flowing mud on the surfaces of normally dry land areas as 
when earth is carried by a current of water and deposited along the path 
of the current.
    B. The collapse or subsidence of land along the shore of a lake or 
other body of water as a result of erosion or undermining caused by

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waves or currents of water exceeding the cyclical levels which result in 
flooding as defined in subparagraph A-1 above.
    Improvements means fixtures, alterations, or additions comprising a 
part of the insured building.
    Manufactured home means a building transportable in one or more 
sections, which is built on a permanent chassis and designed to be used 
with or without a permanent foundation when connected to the required 
utilities. The term manufactured home does not include park trailers, 
and other similar vehicles. To be eligible for coverage under this 
policy, a manufactured home must be on a permanent foundation and, if 
located in a FEMA designated Special Hazard Area, must meet the 
requirements of paragraph H. of Article 6.
    Mobile home means a manufactured home.
    National Flood Insurance Program means the program of flood 
insurance coverage and floodplain management administered under the Act 
and applicable Federal regulations in Title 44 of the Code of Federal 
Regulations, Subchapter B.
    Policy means the entire written contract between the Insured and the 
Insurer, including this printed form, the application, and declarations 
page, any endorsements which may be issued and any renewal certificates 
indicating that coverage has been instituted for a new policy and policy 
term. Only one building, specifically described by the Insured in the 
application, may be insured under this policy, unless application to 
cover more than one building is made on a form or in a format approved 
for that purpose by the Federal Insurance Administrator.
    Post-FIRM building means a building for which the start of 
construction or substantial improvement occurred after December 31, 
1974, or on or after the effective date of the initial Flood Insurance 
Rate Map (FIRM) for the community in which the building is located, 
whichever is later.
    Pre-FIRM rated building means a building for which the start of 
construction or substantial improvement occurred on or before December 
31, 1974, or before the effective date of the initial FIRM for the 
community in which the building is located, whichever is later.
    Probation Additional Premium means a flat charge per policy term 
paid by the Insured on all new and renewal policies issued covering 
property in a community that has been placed on probation under the 
provisions of 44 CFR 59.24.
    Regular Program Community means a community wherein a FIRM is in 
effect and full limits of coverage are available under the Act.
    Residential Condominium Building means a building owned by the 
members of a condominium association containing one or more residential 
units and in which at least 75% of the floor area within the building is 
residential.
    Special hazard area means an area having special flood, mudslide 
(i.e., mudflow), and/or flood-related erosion hazards, and shown on a 
FHBM or FIRM as Zone A, AO, A1-30, AE, A99, AH, AR, VO, V1-30, VE, V, M 
or E.
    Unit means a unit in the insured Condominium Building.
    Valued policy means a policy contract in which the Insurer and the 
Insured agree on the value of the property insured, that value being 
payable in event of total loss.
    Walled and Roofed means the building has in place two or more 
exterior, rigid walls and the roof is fully secured so that the building 
will resist flotation, collapse and lateral movement.

                      Article 3--Losses Not Covered

    The Insurer only provides coverage for direct physical loss by or 
from flood which means the following are not covered:
    A. Compensation, reimbursement or allowance for:
    1. Loss of use of the insured property or premises.
    2. Loss of access to the insured property or premises.
    3. Loss of profits.
    4. Loss resulting from interruption of business, profession, or 
manufacture.
    5. Any additional expenses incurred while the insured building is 
being repaired or is uninhabitable for any reason.
    6. Any increased cost of repair or reconstruction as a result of any 
ordinance regulating reconstruction or repair except as provided in 
Coverage D-- Increased Cost of Compliance.
    7. Any other economic loss.
    B. Losses from other casualties, including loss caused by:
    1. Theft, fire, windstorm, wind, explosion, earthquake, land 
sinkage, landslide, destabilization or movement of land resulting from 
the accumulation of water in subsurface land areas, gradual erosion, or 
any other earth movement except such mudslides (i.e., mudflows) or 
erosion as is covered under the peril of flood.
    2. Rain, snow, sleet, hail or water spray.
    3. Land subsidence, sewer backup, or seepage of water unless, 
subject to additional deductibles as provided for at Article 7, (a) 
there is a general and temporary condition of flooding in the area, (b) 
the flooding is the proximate cause of the land subsidence, sewer 
backup, or seepage of water, (c) the land subsidence, sewer backup, or 
seepage of water damage occurs no later than 72 hours after the flood 
has receded, and (d) the insured building must be insured, at the time 
of the loss, for at least 80 percent of its replacement cost or the 
maximum amount of insurance available under the National Flood Insurance 
Program.

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    4. Freezing, thawing, or the pressure or weight of ice or water.
    5. Water, moisture, mildew, mold or mudslide (i.e., mudflow) damage 
resulting primarily from any condition substantially confined to the 
insured building or from any condition which is within the Insured's 
control (including but not limited to design, structural or mechanical 
defects, failures, stoppages or breakages of water or sewer lines, 
drains, pumps, fixtures or equipment).
    C. Losses of the following nature:
    1. A loss which is already in progress as of 12:01 a.m. of the first 
day of the policy term, or, as to any increase in the limits of coverage 
which is requested by the Insured, a loss which is already in progress 
as of 12:01 a.m. on the date when the additional coverage becomes 
effective.
    2. A loss from a flood which is confined to the premises on which 
the insured property is located unless the flood is displaced over two 
acres of the premises.
    3. A loss caused by the Insured's modification to the insured 
property which materially increases the risk of flooding.
    4. A loss caused intentionally by the Insured.
    5. A loss caused by or resulting from power, heating or cooling 
failure, unless such failure results from physical damage to power, 
heating or cooling equipment situated on the premises where the 
described building or unit is located, caused by a flood.
    6. A loss to any building or contents located on property leased 
from the Federal Government, arising from or incident to the flooding of 
the property by the Federal Government where the lease expressly holds 
the Federal Government harmless, under flood insurance issued under any 
Federal Government program, from loss arising from or incident to the 
flooding of the property by the Federal Government.

Article 4--Property Covered (Subject to Articles 3, 5 and 6 Provisions, 
 Which Also Apply to the Other Articles, Terms, and Conditions of This 
                Policy, Including the Insuring Agreement)

                      Coverage A--Building Property

    This policy covers a building (the ``building'') at the premises 
which is described in the application, and includes:
    1. The entire building, for its real property elements, including, 
if owned in common by a Condominium Association, as named Insured, all 
units within the building and the improvements within the units.
    2. Additions and extensions attached to and in contact with the 
building by means of a common wall (but see Article 6, paragraph D.2.).
    3. Fixtures, machinery and equipment, including the following 
property, all while within the building and owned by the named Insured, 
as to which coverage is not provided under ``Coverage B--Personal 
Property'':
     Furnaces
     Wall Mirrors Permanently Installed
     Permanently Installed Corner Cupboards, Bookcases, 
Paneling, and Wallpaper
     Ventilating Equipment
     Fire Extinguishing Apparatus
     Venetian Blinds
     Central Air Conditioners
     Awnings and Canopies
     Elevator Equipment
     Fire Sprinkler Systems
     Outdoor Antennas and Aerials
     Pumps and Machinery for Operating Them
     Carpet Permanently Installed Over Unfinished Flooring
     In the Units Within the Building, Installed:
     Built-in Dishwashers
     Garbage Disposal Units
     Hot Water Heaters
     Kitchen Cabinets
     Built-in Microwave Ovens
     Plumbing Fixtures
     Radiators
     Ranges
     Refrigerators
     Stoves
    4. Materials and supplies to be used in constructing, altering or 
repairing the building while stored inside a fully enclosed building:
    a. At the property address; or
    b. On an adjacent property at the time of loss; or
    c. In case of another building at the property address which does 
not have walls on all sides, while stored and secured to prevent 
flotation out of the building during flooding (the flotation out of the 
building shall be deemed to establish the conclusive presumption that 
the materials and supplies were not reasonably secured to prevent 
flotation, in which case no coverage is provided for such materials and 
supplies under this policy).
    5. A building in the course of construction before it is walled and 
roofed subject to the following conditions:
    a. The amount of the deductible for each loss occurrence before the 
building is walled and roofed is two times the deductible which is 
selected to apply after the building is walled and roofed;
    b. Coverage is provided before the building is walled and roofed 
only while construction is in progress, or if construction is halted, 
only for a period of up to 90 continuous days thereafter, until 
construction is resumed; and
    c. There is no coverage before the building is walled and roofed 
where the lowest floor, including basement floor, of a non-elevated 
building or the lowest elevated floor of an elevated building is below 
the base flood elevation in Zones AH, AE or A1-30 or is below the base 
flood elevation adjusted to include

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the effect of wave action in Zones VE or V1-30. The lowest floor levels 
are based on the bottom of the lowest horizontal structural member of 
the floor in Zones VE or V1-30 and the top of the floor in Zones AH, AE 
or A1-30.

                      Coverage B--Personal Property

    A. Subject to paragraphs B, C, and D, below, this policy covers 
personal property which is in or on the insured, fully enclosed building 
and is:
    1. Owned solely by the Insured, or in common by the unit owners of a 
condominium, i.e., as to which each unit owner has an undivided 
ownership interest; or
    2. In the case of a condominium, owned solely by a condominium 
association and used exclusively in the conduct of the business affairs 
of the condominium.
    3. Such personal property is also covered while stored at a 
temporary location, as expressly authorized under this policy (see 
Article 5, paragraph B.2.).
    B. When the insurance under this policy covers personal property 
(contents), coverage shall be for either household contents or other 
than household contents, but not for both.
    1. When the insurance under this policy covers other than household 
contents, such insurance shall cover, subject to ``Coverage A--Building 
Property'', paragraph 3.: Merchandise and stock, materials and stock 
supplies of every description, furniture, fixtures, machinery and 
equipment of every description all owned by the Insured and all while 
within the described enclosed building. Bailees' goods are specifically 
excluded from coverage under this policy.
    2. When the insurance under this policy covers household contents, 
such insurance shall cover, subject to ``Coverage A--Building 
Property'', paragraph 3.: All household and personal property usual or 
incidental to the occupancy of the premises as a residence, except any 
property more specifically covered in whole or in part by other 
insurance including the peril insured against in this policy, belonging 
to the Insured or members of the Insured's family of the same household, 
or for which the Insured may be liable, or, at the option of the 
Insured, belonging to a servant or guest of the Insured--all while 
within the described enclosed building.
    C. Coverage for personal property includes the following property, 
subject to paragraph A. 1. and 2., above, for which coverage is not 
provided (irrespective of the manner in which the property is installed 
in or adapted to the building) under ``Coverage A--Building Property'':
     Clothes Washers
     Clothes Dryers
     Food Freezers
     Air Conditioning Units Installed in the Building
     Portable Dishwashers
     Carpet, including wall-to-wall carpet, over finished 
flooring and whether or not it is permanently installed
     Carpet not permanently installed over unfinished flooring
     Outdoor equipment and furniture stored inside the dwelling 
or another fully enclosed building at the property address
     Portable microwave ovens and ``cook-out'' grills, ovens and 
the like
    D. Limitations. Under this ``Coverage B--Personal Property'', the 
Insured shall not be reimbursed for loss as to the following personal 
property to the extent the loss to any one or more of such property 
exceeds, individually or in total, $250.00:
     Artwork, including but not limited to, paintings, etchings, 
pictures, tapestries, art glass windows including their frames, 
statuary, marbles, and bronzes;
     Rare books;
     Necklaces, bracelets, gems, precious or semi-precious 
stones, watches, articles of gold, silver, or platinum; or
     Furs or any article containing fur which represents its 
principal value.
    E. The Insured, if not an owner of the described building, may apply 
up to 10 percent of the amount of insurance applicable to the personal 
property covered under this item, not as an additional amount of 
insurance, to cover loss to improvements to the described building which 
have been made, or acquired, at the expense of the Insured exclusive of 
rent paid by the Insured, even though the improvements are not legally 
subject to removal by the Insured.
    F. The Insured, if a condominium unit owner in the described 
building, may apply up to 10 percent of the amount of insurance on 
personal property covered under this policy, not as an additional amount 
of insurance, to cover loss to the interior walls, floors, and ceilings 
that are not otherwise covered under a condominium association policy 
insuring the described non-residential condominium building.
    G. In the case of personal property owned by the Insured in a 
condominium building, as a condominium unit owner, as well as in common 
with other condominium unit owners, should the amount of insurance 
collectible under this policy for a loss, when combined with any 
recovery available to the Insured as a tenant in common under any 
condominium association flood insurance coverage provided under the Act 
for the same loss, exceed the statutorily permissible limits of personal 
property coverage available under the Act for the insuring of the 
personal property, then the limits of personal property coverage under 
this policy shall be reduced in regard to that loss by the amount of 
such excess.
    The insurance under this policy shall be excess over any insurance 
in the name of the Condominium Association covering the same

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property. Loss shall not be paid under this policy until the Insurer has 
verified the extent to which such loss is covered by any insurance in 
the name of a condominium association.

                       Coverage C--Debris Removal

    This insurance covers expense incurred in the removal of debris of, 
or on, or from the building or personal property covered hereunder, 
which may be occasioned by loss caused by a flood. Under these 
provisions coverage extends to:
    1. Non-owned debris from beyond the boundaries of the described 
premises which is physically on the insured property (i.e., on the 
building or the personal property).
    2. Parts of the insured property anywhere:
    a. On the described premises; and
    b. On property beyond the boundaries of the described premises.
    The total liability under this policy for both loss to property and 
debris removal expense shall not exceed the amount of insurance applying 
under this policy to the property covered.

            Coverage D--Increased Cost of Compliance Coverage

    Increased Cost of Compliance coverage (Coverage D) is for the 
consequential loss brought on by a floodplain management ordinance or 
law affecting repair and reconstruction involving elevation, 
floodproofing, relocation, or demolition (or any combination thereof) of 
a structure, after a direct loss caused by a ``flood'' as defined by 
this policy. (Floodproofing activities eligible for Coverage D and 
referred to hereafter in this policy are limited to residential 
structures with basements that satisfy the criteria of 44 CFR 60.6 (b) 
or (c) and to non-residential structures.)
    The limit of liability under this Coverage D (Increased Cost of 
Compliance) will not exceed $15,000. This coverage is only applicable to 
policies with building coverage (Coverage A) and is in addition to the 
Building limit you selected on your application, and appears on the 
Declarations Page. No separate deductible applies. The maximum amount 
collectible under this policy for both Coverage A (Building Property) 
and Coverage D (Increased Cost of Compliance), however, cannot exceed 
the maximum permitted under the Act.
    Eligibility
    A structure covered under Coverage A--Building Property--sustaining 
a loss caused by a ``flood'' as defined by this policy must:
    1. Be a structure that is a repetitive loss structure. A repetitive 
loss structure means a structure, covered by a contract for flood 
insurance issued pursuant to the Act, that has incurred flood-related 
damage on 2 occasions during a 10-year period ending on the date of the 
event for which a second claim is made, in which the cost of repairing 
the flood damage, on the average, equaled or exceeded 25% of the market 
value of the structure at the time of each such flood event. In addition 
to the current claim, the National Flood Insurance Program must have 
paid the previous qualifying claim, and the State or community must have 
a cumulative, substantial damage provision or repetitive loss provision 
in its flood plain management law or ordinance being enforced against 
the structure; or
    2. Be a structure that has had flood damage in which the cost to 
repair equals or exceeds 50% of the market value of the structure at the 
time of the flood event. The State or community must have a substantial 
damage provision in its floodplain management law or ordinance being 
enforced against the structure.
    This Coverage D will not pay for Increased Cost of Compliance to 
meet State or community floodplain management laws or ordinances which 
exceed the minimum criteria at 44 CFR 60.3, except as provided in 1. 
above or a. or b. as follows:
    a. Elevation or floodproofing in any risk zone to preliminary or 
advisory base flood elevations provided by FEMA which the State or local 
government has adopted and is enforcing for flood-damaged structures in 
such areas. (This includes compliance activities in B, C, X, or D zones 
which are being changed to zones with base flood elevations. This also 
includes compliance activities in zones where base flood elevations are 
being increased, and a flood-damaged structure must comply with the 
higher advisory base flood elevation.) Increased Cost of Compliance 
coverage does not respond to situations in B, C, X, or D zones where the 
community has derived its own elevations and is enforcing elevation or 
floodproofing requirements for flood-damaged structures to elevations 
derived solely by the community.
    b. Elevation or floodproofing above the base flood elevation to meet 
State or local ``freeboard'' requirements, i.e., that a structure must 
be elevated above the base flood elevation.
    Under the minimum NFIP criteria at 44 CFR 60.3(b)(4), States and 
communities must require the elevation or floodproofing of structures to 
the base flood elevation where elevation data are obtained from a 
Federal, State, or other source. Such compliance activities are also 
eligible for this Coverage D.
    This coverage will also pay for the incremental cost, after 
demolition, or relocation, of elevating or floodproofing a structure 
during its rebuilding at the same or another site to meet State or local 
floodplain management laws or ordinances, subject to Exclusion (7).
    This coverage will also pay to bring a flood-damaged structure into 
compliance

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with State or local floodplain management laws or ordinances even if the 
structure had received a variance before the present loss from the 
applicable floodplain management requirements.
    Conditions
    (1) When a structure covered under Coverage A--Building Property--
sustains a loss caused by a ``flood'' as defined by this policy, our 
payment for the loss under this Coverage D will be for the increased 
cost to elevate, floodproof, relocate, demolish, or any combination 
thereof, caused by enforcement of current State or local floodplain 
management ordinances or laws. Our payment for eligible demolition 
activities will be for the cost to demolish and clear the site of the 
building or a portion thereof caused by enforcement of current State or 
local floodplain management ordinances or laws. Eligible activities for 
the cost of clearing the site will include those necessary to 
discontinue utility service to the site and ensure proper abandonment of 
on-site utilities.
    (2) When the building is repaired or rebuilt, it must be intended 
for the same occupancy as the present building unless otherwise required 
by current floodplain management ordinances or laws.
    Exclusions
    Under this Coverage D (Increased Cost of Compliance), we will not 
pay for:
    (1) The cost associated with enforcement of any floodplain 
management ordinance or law in communities participating in the 
Emergency Program.
    (2) The cost associated with enforcement of any ordinance or law 
that requires any insured or others to test for, monitor, clean up, 
remove, contain, treat, detoxify or neutralize, or in any way respond 
to, or assess the effects of pollutants. Pollutants include but are not 
limited to any solid, liquid, gaseous or thermal irritant or 
contaminant, including smoke, vapor, soot, fumes, acid, alkalis, 
chemicals and waste. Waste includes but is not limited to materials to 
be recycled, reconditioned or reclaimed.
    (3) The loss in value to any covered building or other structure due 
to the requirements of any ordinance or law.
    (4) The loss in residual value of the undamaged portion of a 
building demolished as a consequence of enforcement of any State or 
local floodplain management law or ordinance.
    (5) Any increased cost of compliance under this Coverage D:
    (a) Until the covered building is actually elevated, floodproofed, 
demolished or relocated on the same or to another premises; and
    (b) Unless the covered building is elevated, floodproofed, 
demolished, or relocated as soon as reasonably possible after the loss, 
not to exceed two years.
    (6) For any code upgrade requirements, e.g., plumbing or electrical 
wiring, not specifically related to the State or local floodplain 
management law or ordinance.
    (7) For any compliance activities needed to bring additions or 
improvements made after the loss occurred into compliance with State or 
local floodplain management laws or ordinances.
    (8) Loss due to any ordinance or law that you were required to 
comply with before the current loss.
    (9) For any rebuilding activity to standards that do not meet the 
NFIP's minimum requirements. This includes any situation where the 
insured has received from the State or community a variance in 
connection with the current flood loss to rebuild the property to an 
elevation below the base flood elevation.
    (10) For any structure insured under a Group Flood Insurance Policy 
issued pursuant to 44 CFR 61.17.
    Other Provisions
    (1) Increased Cost of Compliance coverage will not be included in 
the calculation to determine whether coverage meets the 80% insurance-
to-value requirement for payment under Article 3.B.3 for loss from land 
subsidence, sewer backup, or seepage of water.
    (2) All other conditions and provisions of the policy apply.

    Article 5--Special Provisions Applicable to Coverages A, B, and C

    A. This policy is not a valued policy. Loss will be paid, provided 
the Insured has purchased a sufficient amount of coverage, i.e., in an 
amount equal to the lesser of the value of the damaged property under 
the terms and conditions of this policy (and regardless of whether the 
amount of insurance purchased is greater than such value) or the limit 
of coverage permitted under the Act.
    B. Insured Property, Covered Locations. The building and personal 
property are covered while the property is located:
    1. At the property address shown on the application; and
    2. For 45 days at another place above ground level or outside of the 
special hazard area, to which any of the insured property shall 
necessarily be removed in order to protect and preserve it from flood, 
due to the imminent danger of flood (provided, personal property so 
removed must be placed in a fully enclosed building or otherwise 
reasonably protected from the elements to be insured against loss), in 
which case the reasonable expenses incurred by the Insured, including 
the value of its own labor at prevailing Federal minimum wage rates, in 
moving any of the insured property temporarily away from the peril of 
flood shall be reimbursed in an amount not to exceed $500.00. This 
policy's deductible amounts, as provided for at Article 7, shall not be 
applied to this

[[Page 278]]

reimbursement, but shall be applied to any other benefits under this 
policy's coverage.
    C. Coverage For Certain Loss Mitigation Measures. When the insurance 
under this policy covers a building, reasonable expenses incurred by the 
Insured for the purchase of the following items are also covered, in an 
aggregate amount not to exceed $750.00:
    1. Sandbags, including sand to fill them and plastic sheeting and 
lumber used in connection with them;
    2. Fill for temporary levees;
    3. Pumps; and
    4. Wood;

all for the purpose of saving the building due to the imminent danger of 
a flood loss, including the value of the Insured's own labor at 
prevailing Federal minimum wage rates.
    For reimbursement under this paragraph C. to apply, the following 
conditions must be met:
    a. The insured property must be in imminent danger of sustaining 
flood damage; and
    b. The threat of flood damage must be of such imminence as to lead a 
person of common prudence to apprehend flood damage; and
    c. A general and temporary condition of flooding in the area must 
occur, even if the flooding does not reach the insured property, or a 
legally authorized official must issue an evacuation order or other 
civil order for the community in which the insured property is located 
calling for measures to preserve life and property from the peril of 
flood.
    The policy's building deductible amount, as provided for at Article 
7, shall not be applied to this reimbursement, but shall be applied to 
any other benefits under the policy's building coverage.

                     Article 6--Property Not Covered

    This policy shall not cover any of the following:
    A. Valuables and commercial property, meaning:
    1. Accounts, bills, currency, deeds, evidences of debt, money, 
coins, medals, postage stamps, securities, bullion, manuscripts, other 
valuable papers or records, and personal property used in a business.
    2. Personal property used in connection with any incidental 
commercial occupancy or use of the building.
    B. Property over water or in the open, meaning:
    1. A building and personal property in the building located entirely 
in, on, or over water or seaward of mean high tide, if the building was 
newly constructed or substantially improved on or after October 1, 1982.
    2. Personal property in the open.
    C. Structures other than buildings, including:
    1. Fences, retaining walls, seawalls, bulkheads, wharves, piers, 
bridges, and docks.
    2. Indoor and outdoor swimming pools.
    3. Open structures and personal property located in, on, or over 
water, including boat houses or any structure or building into which 
boats are floated.
    4. Underground structures and equipment, including wells, septic 
tanks and septic systems.
    D. Other real property, including:
    1. Land, land values, lawns, trees, shrubs, plants, and growing 
crops.
    2. Those portions of walks, walkways, decks, driveways, patios, and 
other surfaces, all whether covered or not and all of whatever kind of 
construction, located outside the perimeter, exterior walls of the 
insured building.
    E. Other personal property, meaning:
    1. Animals, livestock, birds, and fish.
    2. Aircraft.
    3. Any self-propelled vehicle or machine and motor vehicle (other 
than motorized equipment pertaining to the service of the described unit 
or building, operated principally on the premises of the Insured, and 
not licensed for highway use) including their parts and equipment.
    4. Trailers on wheels and other recreational vehicles whether 
affixed to a permanent foundation or on wheels.
    5. Watercraft including their furnishings and equipment.
    6. Personal property owned by or in the care, custody or control of 
a unit owner, except for the property described in Article 4 under 
``Coverage B--Personal Property'', paragraph B. of this policy.
    F. Basements, building enclosures lower than the elevated floors of 
elevated buildings, and personal property, as follows:
    1. In a special hazard area, at an elevation lower than the lowest 
elevated floor of an elevated Post-FIRM building, including a 
manufactured (i.e., mobile) home:
    a. Personal property.
    b. Building enclosures, equipment, machinery, fixtures and 
components, except for the required utility connections and the 
footings, foundation, posts, pilings, piers or other foundation walls 
and anchorage system as required for the support of the building.
    2. In a basement as defined in Article 2:
    a. Personal property.
    b. Building equipment, machinery, fixtures and components, including 
finished walls, floors, ceilings and other improvements, except for the 
required utility connections, fiberglass insulation, drywalls and 
sheetrock walls, and ceilings but only to the extent of replacing 
drywalls and sheetrock walls in an unfinished manner (i.e., nailed to 
framing but not taped, painted, or covered).
    3. Provided, with regard to both 1. and 2., above, the following 
building and personal property items connected to a power source and 
installed in their functioning location

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are covered so long as the Insured has purchased building and personal 
property coverage, as appropriate:
     Sump pumps
     Well water tanks and pumps
     Oil tanks and the oil in them
     Cisterns and the water in them
     Natural gas tanks and the gas in them
     Pumps and/or tanks used in conjunction with solar energy
     Furnaces
     Hot water heaters
     Clothes washers and dryers
     Food freezers and the food in them
     Air conditioners
     Heat pumps
     Electrical junction and circuit breaker boxes
     Stairways and staircases attached to the building which are 
not separated from the building by elevated walkways
     Clean-up
     Elevators, dumbwaiters, and relevant equipment, except for 
such relevant equipment located below the base flood elevation if such 
relevant equipment was installed on or after October 1, 1987.
    G. Property below ground, meaning a building or unit and its 
contents, including personal property and machinery and equipment, which 
are part of the building or unit, where more than 49 percent of the 
actual cash value of such building or unit is below ground, unless the 
lowest level is at or above the base flood elevation (in the Regular 
Program) or the adjacent ground level (in the Emergency Program) by 
reason of earth having been used as an insulation material in 
conjunction with energy efficient building techniques.
    H. Certain manufactured homes, meaning a manufactured (i.e., mobile) 
home located or placed within a FEMA designated Special Hazard Area that 
is not anchored to a permanent foundation to resist flotation, collapse, 
or lateral movement:
    1. By over-the-top or frame ties to ground anchors; or
    2. In accordance with manufacturer's specifications; or
    3. In compliance with the community's floodplain management 
requirements;

unless it is a manufactured (i.e., mobile) home on a permanent 
foundation continuously insured by the National Flood Insurance Program 
at the same site at least since September 30, 1982.
    I. Containers such as but not limited to gas tanks or liquid tanks.
    J. Buildings and their contents made ineligible for flood insurance 
pursuant to the provisions of the Coastal Barrier Resources Act, 16 
U.S.C. 3501 et seq., and the Coastal Barrier Improvement Act of 1990, 
Public Law 101-591, 16 U.S.C. 3501 et seq.
    K. Residential condominium buildings and their contents owned by the 
Insured as a tenant in common with others under a condominium form of 
ownership and any building components and contents owned solely by the 
Insured in connection with a residential condominium building in a 
Regular Program community.

                         Article 7--Deductibles

    A. Each loss to the insured property is subject to a deductible 
provision under which the Insured bears a portion of the loss before 
payment is made under the policy.
    B. The loss deductible shall apply separately to each building and 
personal property coverage loss including, as to each, any appurtenant 
structure loss and debris removal expense.
    C. For any flood insurance policy issued or renewed for a property 
located in an Emergency Program community or for any property located in 
a Regular Program community in Zones A, AO, AH, A1-30, AE, VO, V1-30, 
VE, or V where the rates available for buildings built before the 
effective date of the initial Flood Insurance Rate Map or December 31, 
1974, whichever is later, are used to compute the premium, the amount of 
the deductible for each loss occurrence is determined as follows: The 
Insurer shall be liable only when such loss exceeds $750.00, or the 
amount of any higher deductible which the Insured selected when it 
applied for this policy or subsequently by endorsement.
    D. For policies other than those described in paragraph C. above, 
the amount of the deductible for each loss occurrence is determined as 
follows: The Insurer shall be liable only when such loss exceeds 
$500.00, or the amount of any higher deductible which the Insured 
selected when it applied for this policy or subsequently by endorsement.
    E. Notwithstanding the applicable deductible in paragraphs C. or D. 
above, an additional deductible in the sum of $250.00 shall apply 
separately to each building and contents loss before payment is made 
under the policy for land subsidence, sewer backup, or seepage of water 
as provided for in Article 3, paragraph B.3.

              Article 8--General Conditions and Provisions

    A. Pair and Set Clause: If there is loss of an article which is part 
of a pair or set, the measure of loss shall be a reasonable and fair 
proportion of the total value of the pair or set, giving consideration 
to the importance of said article, but such loss shall not be construed 
to mean total loss of the pair or set.
    B. Concealment, Fraud: This policy shall be void, nor can this 
policy be renewed or any new flood insurance coverage be issued to the 
Insured if any person insured under Article 1, paragraph A., whether 
before or after a loss, has:
    1. Sworn falsely, or willfully concealed or misrepresented any 
material fact; or

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    2. Done any fraudulent act concerning this insurance (See paragraph 
E.1.d. below); or
    3. Willfully concealed or misrepresented any fact on a 
``Recertification Questionnaire,'' which causes the Insurer to issue a 
policy based on a premium amount which is less than the premium amount 
which would have been payable were it not for the misstatement of fact 
(see paragraph F. below).
    C. Other Insurance: If a loss covered by this policy is also covered 
by other insurance, whether collectible or not, the Insurer will pay 
only the proportion of the loss that the limit of liability that applies 
under this policy bears to the total amount of insurance covering the 
loss, provided, if at the time of loss, there is other insurance made 
available under the Act, in the name of a unit owner which provides 
coverage for the same loss covered by this policy, this policy's 
coverage shall be primary and not contributing with such other 
insurance.
    D. Amendments and Waivers, Assignment: This Standard Flood Insurance 
Policy cannot be amended nor can any of its provisions be waived without 
the express written consent of the Federal Insurance Administrator. No 
action the Insurer takes under the terms of this policy can constitute a 
waiver of any of its rights. Except in the case of 1. a contents only 
policy and 2. a policy issued to cover a building in the course of 
construction, assignment of this policy, in writing, is allowed upon 
transfer of title.
    E. Voidance, Reduction or Reformation of the Coverage:
    1. Voidance: This policy shall be void and of no legal force and 
effect in the event that any one of the following conditions occurs:
    a. The property listed on the application is not eligible for 
coverage, in which case the policy is void from its inception;
    b. The community in which the property is located was not 
participating in the National Flood Insurance Program on the policy's 
inception date and did not qualify as a participating community during 
the policy's term and before the occurrence of any loss;
    c. If, during the term of the policy, the participation in the 
National Flood Insurance Program of the community in which the property 
is located ceases, in which case the policy shall be deemed void 
effective at the end of the last day of the policy year in which such 
cessation occurred and shall not be renewed.
    In the event the voided policy included 3 policy years in a contract 
term of 3 years, the Insured shall be entitled to a pro-rata refund of 
any premium applicable to the remainder of the policy's term;
    d. In the event any Insured or its agent has:
    (1) Sworn falsely; or
    (2) Fraudulently or willfully concealed or misrepresented any 
material fact including facts relevant to the rating of this policy in 
the application for coverage, or upon any renewal of coverage, or in 
connection with the submission of any claim brought under the policy, in 
which case this entire policy shall be void as of the date the wrongful 
act was committed or from its inception if this policy is a renewal 
policy and the wrongful act occurred in connection with an application 
for or renewal or endorsement of a policy issued to the Insured in a 
prior year and affects the rating of or premium amount received for this 
policy. Refunds of premiums, if any, shall be subject to offsets for the 
Insurer's administrative expenses (including the payment of agent's 
commissions for any voided policy year) in connection with the issuance 
of the policy;
    e. The premium submitted is less than the minimum set forth in 44 
CFR 61.10 in connection with any application for a new policy or policy 
renewal, in which case the policy is void from its inception date.
    2. Reduction of Coverage Limits or Reformation: In the event that 
the premium payment is not sufficient (whether evident or not) to 
purchase the amount of coverage requested by an application, renewal, 
endorsement, or other form and paragraph E.1.d. does not apply, then the 
policy shall be deemed to provide only such coverage as can be purchased 
for the entire term of the policy, for the amount of premium received, 
subject to increasing the amount of coverage pursuant to 44 CFR 61.11; 
provided, however:
    a. If the insufficient premium is discovered by the Insurer prior to 
a loss and the Insurer can determine the amount of insufficient premium 
from information in its possession at the time of its discovery of the 
insufficient premium, the Insurer shall give a notice of additional 
premium due, and if the Insured remits and the Insurer receives the 
additional premium required to purchase the limits of coverage for each 
kind of coverage as was initially requested by the Insured within 30 
days from the date the Insurer gives the Insured written notice of 
additional premium due, the policy shall be reformed, from its inception 
date, or, in the case of an endorsement, from the effective date of the 
endorsement, to provide flood insurance coverage in the amount of 
coverage initially requested.
    b. If the insufficient premium is discovered by the Insurer at the 
time of a loss under the policy, the Insurer shall give a notice of 
premium due, and if the Insured remits and the Insurer receives the 
additional premium required to purchase (for the current policy term and 
the previous policy term, if then insured) the limits of coverage for 
each kind of coverage as was initially requested by the Insured within 
30 days from the date the Insurer gives the Insured written notice of 
additional premium due, the policy shall be reformed, from its inception 
date, or, in the

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case of an endorsement, from the effective date of the endorsement, to 
provide flood insurance coverage in the amount of coverage initially 
requested.
    c. Under subparagraphs a. and b. as to any mortgagee or trustee 
named in the policy, the Insurer shall give a notice of additional 
premium due and the right of reformation shall continue in force for the 
benefit only of the mortgagee or trustee, up to the amount of the 
Insured's indebtedness, for 30 days after written notice to the 
mortgagee or trustee.
    F. Policy Renewal: The term of this policy commences on its 
inception date and ends on its expiration date, as shown on the 
declarations page which is attached to the policy. The Insurer is under 
no obligation to:
    1. Send the Insured any renewal notice or other notice that the 
policy term is coming to an end and the receipt of any such notice by 
the Insured shall not be deemed to be a waiver of this provision on the 
Insurer's part.
    2. Assure that policy changes reflected in endorsements submitted 
during the policy term are included in any renewal notice or new policy 
sent to the Insured. Policy changes includes the addition of any 
increases in the amounts of coverage.
    This policy shall not be renewed and the coverage provided by it 
shall not continue into any successive policy term unless the renewal 
premium payment is received by the Insurer at the office of the National 
Flood Insurance Program within 30 days of the expiration date of this 
policy, subject to paragraph E. above. If the renewal premium payment is 
mailed by certified mail to the Insurer prior to the expiration date, it 
shall be deemed to have been received within the required 30 days. The 
coverage provided by the renewal policy is in effect for any loss 
occurring during this 30-day period even if the loss occurs before the 
renewal premium payment is received, so long as the renewal premium 
payment is received within the required 30 days. In all other cases, 
this policy shall terminate as of the expiration date of the last policy 
term for which the premium payment was timely received and in that 
event, the Insurer shall not be obligated to provide the Insured with 
any cancellation, termination, policy lapse, or policy renewal notice.
    In connection with the renewal of this policy, the Insured may be 
requested during the policy term to recertify, on a Recertification 
Questionnaire the Insurer will provide, the rating information used to 
rate the most recent application for or renewal of insurance.
    Notwithstanding the Insured's responsibility to submit the 
appropriate renewal premium in sufficient time to permit its receipt by 
the Insurer prior to the expiration of the policy being renewed, the 
Insurer has established a business procedure for mailing renewal notices 
to assist Insureds in meeting their responsibility. Regarding the 
business procedure, evidence of the placing of any such notices into the 
U.S. Postal Service, addressed to the Insured at the address appearing 
on its most recent application or other appropriate form (received by 
the Insurer prior to the mailing of the renewal notice), does, in all 
respects, for purposes of the National Flood Insurance Program, 
presumptively establish delivery to the Insured for all purposes 
irrespective of whether the Insured actually received the notice.
    However, in the event the Insurer determines that, through any 
circumstances, any renewal notice was not placed into the U.S. Postal 
Service, or, if placed, was prepared or addressed in a manner which the 
Insurer determines could preclude the likelihood of its being actually 
and timely received by the Insured prior to the due date for the renewal 
premium, the following procedures shall be followed:
    In the event that the Insured or its agent notified the Insurer, not 
later than 1 year after the date on which the payment of the renewal 
premium was due, of a nonreceipt of a renewal notice prior to the due 
date for the renewal premium, which the Insurer determines was 
attributable to the above circumstance, the Insurer shall mail a second 
bill providing a revised due date, which shall be 30 days after the date 
on which the bill is mailed.
    If the renewal payment requested by reason of the second bill is not 
received by the revised due date, no renewal shall occur and the policy 
shall remain as an expired policy as of the expiration date prescribed 
on the policy.
    G. Conditions Suspending or Restricting Insurance: Unless otherwise 
provided in writing added hereto, the Insurer shall not be liable for 
loss occurring while the hazard is increased by any means within the 
control or knowledge of the Insured.
    H. Liberalization clause: If during the period that insurance is in 
force under this policy or within 45 days prior to the inception date 
thereof, should the Insurer have adopted under the Act, any forms, 
endorsements, rules or regulations by which this policy could be 
extended or broadened, without additional premium charge, by endorsement 
or substitution of form, then, such extended or broadened insurance 
shall inure to the benefit of the Insured as though such endorsement or 
substitution of form had been made. Any broadening or extension of this 
policy to the Insured's benefit shall only apply to losses occurring on 
or after the effective date of the adoption of any forms, endorsements, 
rules or regulations affecting this policy.
    I. Alterations and Repairs: The Insured may, at the Insured's own 
expense, make alterations, additions and repairs, and complete 
structures in the course of construction.
    J. Cancellation of Policy by Insured: The Insured may cancel this 
policy at any time but

[[Page 282]]

a refund of premium money will only be made when:
    1. Except with respect to a condominium building or a building which 
has a condominium form of ownership, the Insured cancels because the 
Insured has transferred ownership of the insured property to someone 
else. In this case, the Insurer will refund to the Insured, once the 
Insurer receives the Insured's written request for cancellation (signed 
by the Insured) the excess of premiums paid by the Insured which apply 
to the unused portion of the policy's term, pro rata but with retention 
of the expense constant and the Federal policy fee.
    2. The Insured cancels a policy having a term of 3 years, on an 
anniversary date, and the reason for the cancellation is that:
    a. A policy of flood insurance has been obtained or is being 
obtained in substitution for this policy and the Insurer has received a 
written concurrence in the cancellation from any mortgagee of which the 
Insurer has actual notice, or
    b. The Insured has extinguished the insured mortgage debt and is no 
longer required by the mortgagee to maintain the coverage. Refund of any 
premium, under this subparagraph 2., shall be pro rata but with 
retention of the expense constant and the Federal policy fee.
    3. The Insured cancels because the Insurer has determined that the 
property is not, in fact, in a special hazard area; and the Insured was 
required to purchase flood insurance coverage by a private lender or 
Federal agency pursuant to Public Law 93-234, section 102 and the lender 
or agency no longer requires the retention of the coverage. In this 
event, if no claims have been paid or are pending, the premium payments 
will be refunded in full, according to applicable National Flood 
Insurance Program regulations.
    K. Loss Clause: Payment of any loss under this policy shall not 
reduce the amount of insurance applicable to any other loss during the 
policy term which arises out of a separate occurrence of the peril 
insured against hereunder; provided, that all loss arising out of a 
continuous or protracted occurrence shall be deemed to constitute loss 
arising out of a single occurrence.
    L. Mortgage Clause: (Applicable to building coverage only and 
effective only when the policy is made payable to a mortgagee or trustee 
named in the application and declarations page attached to this policy 
or of whom the Insurer has actual notice prior to the payment of loss 
proceeds under this policy.)
    Loss, if any, under this policy, shall be payable to the aforesaid 
as mortgagee or trustee as interest may appear under all present or 
future mortgages upon the property described in which the aforesaid may 
have an interest as mortgagee or trustee, in order of precedence of said 
mortgages, and this insurance, as to the interest of the mortgagee or 
trustee only therein, shall not be invalidated:
    1. By any act or neglect of the mortgagor or owner of the described 
property; nor
    2. By any foreclosure or other proceedings or notice of sale 
relating to the property; nor
    3. By any change in the title or ownership of the property; nor
    4. By the occupation of the premises for purposes more hazardous 
than are permitted by this policy, provided, That in case the mortgagor 
or owner shall neglect to pay any premium due under this policy, the 
mortgagee or trustee shall, on demand, pay the same.
    Provided, also, that the mortgagee or trustee shall notify the 
Insurer of any change of ownership or occupancy of the building or 
increase of hazard which shall come to the knowledge of said mortgagee 
or trustee and, unless permitted by this policy, it shall be noted 
thereon and the mortgagee or trustee shall, on demand, pay the premium 
for such increased hazard for the term of the use thereof; otherwise, 
this policy shall be null and void.
    If this policy is cancelled by the Insurer, it shall continue in 
force for the benefit of the mortgagee or trustee for 30 days after 
written notice to the mortgagee or trustee of such cancellation and 
shall then cease.
    Whenever the Insurer shall pay the mortgagee or trustee any sum for 
loss under this policy and shall claim that, as to the mortgagor or 
owner, no liability therefor existed, the Insurer shall, to the extent 
of such payment, be thereupon legally subrogated to all the rights of 
the party to whom such payment shall be made, under all securities held 
as collateral to the mortgage debt, or may, at its option, pay to the 
mortgagee or trustee the whole principal due or to grow due on the 
mortgage with interest, and shall thereupon receive a full assignment 
and transfer of the mortgage and of all such other securities, but no 
subrogation shall impair the right of the mortgagee or trustee to 
recover the full amount of said mortgagee's or trustee's claim.
    M. Mortgagee Obligations: If the Insured fails to render proof of 
loss, the named mortgagee or trustee, upon notice, shall render proof of 
loss in the form herein specified within 60 days thereafter and shall be 
subject to the provisions of this policy relating to appraisal and time 
of payment and of bringing suit.
    N. Loss Payable Clause (Applicable to contents items only): Loss, if 
any, shall be adjusted with the Insured and shall be payable to the 
Insured and loss payee as their interests may appear.
    O. Requirements in Case of Loss: Should a flood loss occur to the 
insured property, the Insured must:
    1. Notify the Insurer in writing as soon as practicable;

[[Page 283]]

    2. As soon as reasonably possible, separate the damaged and 
undamaged property, putting it in the best possible order so that the 
Insurer may examine it; and
    3. Within 60 days after the loss, send the Insurer a proof of loss, 
which is the Insured's statement as to the amount it is claiming under 
the policy signed and sworn to by the Insured and furnishing the 
following information:
    a. The date and time of the loss;
    b. A brief explanation of how the loss happened;
    c. The Insured's interest in the property damaged (for example, 
``owner'') and the interests, if any, of others in the damaged property;
    d. The actual cash value of each damaged item of insured property 
and the amount of damages sustained;
    e. The names of mortgagees or anyone else having a lien, charge or 
claim against the insured property;
    f. Details as to any other contracts of insurance covering the 
property, whether valid or not;
    g. Details of any changes in ownership, use, occupancy, location or 
possession of the insured property since the policy was issued;
    h. Details as to who occupied any insured building at the time of 
loss and for what purpose; and
    i. The amount the Insured claims is due under this policy to cover 
the loss, including statements concerning:
    (1) The limits of coverage stated in the policy; and
    (2) The cost to repair or replace the damaged property (whichever 
costs less).
    4. Cooperate with the Insurer's adjuster or representative in the 
investigation of the claim;
    5. Document the loss with all bills, receipts, and related documents 
for the amount being claimed;
    6. The insurance adjuster whom the Insurer hires to investigate the 
claim may furnish the Insured with a proof of loss form, and she or he 
may help the Insured to complete it. However, this is a matter of 
courtesy only, and the Insured must still send the Insurer a proof of 
loss within 60 days after the loss even if the adjuster does not furnish 
the form or help the Insured complete it. In completing the proof of 
loss, the Insured must use its own judgment concerning the amount of 
loss and the justification for the amount.
    The adjuster is not authorized to approve or disapprove claims or to 
tell the Insured whether the claim will be approved by the Insurer.
    7. The Insurer may, at its option, waive the requirement for the 
completion and filing of a proof of loss in certain cases, in which 
event the Insured will be required to sign and, at the Insurer's option, 
swear to an adjuster's report of the loss which includes information 
about the loss and the damages needed by the Insurer in order to adjust 
the claim.
    8. Any false statements made in the course of presenting a claim 
under this policy may be punishable by fine or imprisonment under the 
applicable Federal laws.
    P. Options After a Loss: Options the Insurer may, in its sole 
discretion, exercise after loss include the following:
    1. Evidence of Loss: If the Insurer specifically requests it, in 
writing, the Insured may be required to furnish a complete inventory of 
the destroyed, damaged and undamaged property, including details as to 
quantities, costs, actual cash values, amount of loss claims, and any 
written plans and specifications for repair of the damaged property 
which can reasonably be made available to the Insurer.
    2. Examination Under Oath and Access to the Condominium 
Association's Articles of Association or Incorporation, Property 
Insurance Policies, and Other Condominium Documents: The Insurer may 
require the Insured to:
    a. Show the Insurer, or its designee, the damaged property;
    b. Be examined under oath by the Insurer or its designee;
    c. Sign any transcripts of such examinations; and
    d. At such reasonable times and places as the Insurer may designate, 
permit the Insurer to examine and make extracts and copies of any 
condominium documents, including the Articles of Association or 
Incorporation, Bylaws, rules and regulations, Declarations of the 
condominium, property insurance policies, and other condominium 
documents; and all books of accounts, bills, invoices and vouchers, or 
certified copies thereof if the originals are lost, pertaining to the 
damaged property.
    3. Options to Repair or Replace: The Insurer may take all or any 
part of the damaged property at the agreed or appraised value and, also, 
repair, rebuild or replace the property destroyed or damaged with other 
of like kind and quality within a reasonable time, on giving the Insured 
notice of the Insurer's intention to do so within 30 days after the 
receipt of the proof of loss herein required under paragraph O. above.
    4. Adjustment Options: The Insurer may adjust loss to any insured 
property of others with the owners of such property or with the Insured 
for their account. Any such insurance under this policy shall not inure 
directly or indirectly to the benefit of any carrier or other bailee for 
hire.
    Q. When Loss Payable: Loss is payable within 60 days after the 
Insured files its proof of loss (or within 90 days after the insurance 
adjuster files an adjuster's report signed and sworn to by the Insured 
in lieu of a proof of loss) and ascertainment of the loss is made either 
by agreement between the Insured and

[[Page 284]]

the Insurer in writing or by the filing with the Insurer of an award as 
provided in paragraph S. below.
    If the Insurer rejects the Insured's proof of loss in whole or in 
part, the Insured may accept such denial of its claim, or exercise its 
rights under this policy, or file an amended proof of loss as long as it 
is filed within 60 days of the date of the loss or any extension of time 
allowed by the Administrator.
    R. Abandonment: The Insured may not abandon damaged or undamaged 
insured property to the Insurer.
    However, the Insurer may permit the Insured to keep damaged, insured 
property (``salvage'') after a loss and reduce the amount of the loss 
proceeds payable to the Insured under the policy by the value of the 
salvage.
    S. Appraisal: In case the Insured and the Insurer shall fail to 
agree as to the actual cash value of the amount of loss, then:
    1. On the written demand of either the Insurer or the Insured, each 
shall select a competent and disinterested appraiser and notify the 
other of the appraiser selected within 20 days of such demand.
    2. The appraisers shall first select a competent and disinterested 
umpire and failing, after 15 days, to agree upon such umpire, then on 
the Insurer's request or the Insured's request, such umpire shall be 
selected by a judge of a court of record in the State in which the 
insured property is located.
    3. The appraisers shall then appraise the loss, stating separately 
actual cash value and loss to each item; and, failing to agree, shall 
submit their differences, only, to the umpire.
    4. An award in writing, so itemized, of any two (appraisers or 
appraiser and umpire) when filed with the Insurer shall determine the 
amount of actual cash value and loss.
    5. Each appraiser shall be paid by the party selecting him or her 
and the expenses of appraisal and umpire shall be paid by both parties 
equally.
    T. Action Against the Insurer: No suit or action on this policy for 
the recovery of any claim shall be sustainable in any court of law or 
equity unless all the requirements of this policy shall have been 
complied with, and unless commenced within 12 months next after the date 
of mailing of notice of disallowance or partial disallowance of the 
claim. An action on such claim against the Insurer must be instituted, 
without regard to the amount in controversy, in the United States 
District Court for the district in which the property shall have been 
situated.
    U. Subrogation: In the event of any payment under this policy, the 
Insurer shall be subrogated to all the Insured's rights of recovery 
therefor against any party, and the Insurer may require from the Insured 
an assignment of all rights of recovery against any party for loss to 
the extent that payment therefor is made by the Insurer. The Insured 
shall do nothing after loss to prejudice such rights; however, this 
insurance shall not be invalidated should the Insured waive in writing 
prior to a loss any or all rights of recovery against any party for loss 
occurring to the described property.
    V. Continuous Lake Flooding: Where the insured building has been 
inundated by rising lake waters continuously for 90 days or more and it 
appears reasonably certain that a continuation of this flooding will 
result in damage, reimbursable under this policy, to the insured 
building equal to or greater than the building policy limits plus the 
deductible(s) or the maximum payable under the policy for any one 
building loss, the Insurer will pay the Insured the lesser of these two 
amounts without waiting for the further damage to occur if the Insured 
signs a release agreeing to:
    1. Make no further claim under this policy; and
    2. Not seek renewal of this policy; and
    3. Not apply for any flood insurance under the Act for property at 
the property location of the insured building.
    If the policy term ends before the insured building has been flooded 
continuously for 90 days, the provisions of this paragraph V. still 
apply so long as the first building damage reimbursable under this 
policy from the continuous flooding occurred before the end of the 
policy term.
    W. Duplicate Policies Not Allowed: Property may not be insured under 
more than one policy issued under the Act. When the Insurer finds that 
duplicate policies are in effect, the Insurer shall by written notice 
give the Insured the option of choosing which policy is to remain in 
effect, under the following procedures:
    1. If the Insured chooses to keep in effect the policy with the 
earlier effective date, the Insurer shall by the same written notice 
give the Insured an opportunity to add the coverage limits of the later 
policy to those of the earlier policy, as of the effective date of the 
later policy.
    2. If the Insured chooses to keep in effect the policy with the 
later effective date, the Insurer shall by the same written notice give 
the Insured the opportunity to add the coverage limits of the earlier 
policy to those of the later policy, as of the effective date of the 
later policy.
    In either case, the Insured must pay the pro rata premium for the 
increased coverage limits within 30 days of the written notice. In no 
event shall the resulting coverage limits exceed the statutorily 
permissible limits of coverage under the Act or the Insured's insurable 
interest, whichever is less.
    The Insurer shall make a refund to the Insured, according to 
applicable National Flood Insurance Program rules, of the premium for 
the policy not being kept in effect.

[[Page 285]]

    For purposes of this paragraph W., the term effective date means the 
date coverage that has been in effect without any lapse was first placed 
in effect. In addition to the provisions of this paragraph W. for 
increasing policy limits, the usual procedures for increasing limits by 
mid-term endorsement or at renewal time, with the appropriate waiting 
period, are applicable to the policy the Insured chooses to keep in 
effect.

                       Article 9--What Law Governs

    This policy is governed by the flood insurance regulations issued by 
FEMA, the National Flood Insurance Act of 1968, as amended (42 U.S.C. 
4001, et seq.) and Federal common law.
    In witness whereof, the Insurer has executed and attested these 
presents.

                                                        James L. Witt,  
                          Director, Federal Emergency Management Agency.

(The information required under the terms of this policy has been 
approved by the Office of Management and Budget under OMB control number 
3067-0021).


[58 FR 62432, Nov. 26, 1993, as amended at 62 FR 8398, Feb. 25, 1997]

                        Appendix A(3) to Part 61

  Federal Emergency Management Agency, Federal Insurance Administration

                     Standard Flood Insurance Policy

[Issued Pursuant to the National Flood Insurance Act of 1968, or Any 
Acts Amendatory Thereof (Hereinafter Called the Act), and Applicable 
Federal Regulations in Title 44 of the Code of Federal Regulations, 
Subchapter B]

           Residential Condominium Building Association Policy

    Read the policy carefully. The coverage provided is subject to 
limitations, restrictions and exclusions.
    This policy covers only a residential condominium building in a 
regular program community. If the community reverts to emergency program 
status during the policy term and remains as an emergency program 
community at time of renewal, this policy cannot be renewed.

                           Insuring Agreement

    Agreement of insurance between the Federal Emergency Management 
Agency (FEMA), as Insurer, and the Insured.
    The Insurer insures the Insured against all Direct physical loss by 
or from flood to the insured property, based upon:
    1. The Insured having paid the correct amount of premium; and
    2. The Insurer's reliance on the accuracy of the information and 
statements the Insured has furnished; and
    3. All the terms of this policy, the National Flood Insurance Act of 
1968, as amended, and Title 44 of the Code of Federal Regulations.
    On this basis, the Insured is insured up to the lesser of:
    1. The actual cash value, except as provided in Article 8, not 
including any antique value, of the property at the time of loss; or
    2. The amount it would cost to repair or replace the property with 
material of like kind and quality within a reasonable time after the 
loss.

                       Article 1--Persons Insured

    The following are insured under this policy:
    A. The named Insured condominium association, unit owners in the 
insured residential condominium building and legal representatives;
    B. Any mortgagee and trustee named in the application and 
declarations page, as well as any other mortgagee or loss payee 
determined to exist at the time of a loss (See Article 10, paragraph 
L.), in the order of precedence and to the extent of their interest but 
for no more, in the aggregate, than the interest of the named Insured.

                         Article 2--Definitions

    As used in this Policy:
    Act means the National Flood Insurance Act of 1968 and any acts 
amendatory thereof.
    Actual Cash Value means the replacement cost of an insured item of 
property at the time of loss, less the value of physical depreciation as 
to the item damaged.
    Application means the statement made and signed by the Insured, or 
the Insured's agent, and giving information on the basis of which the 
Insurer determines the acceptability of the risk, the policy to be 
issued and the correct premium payment, which must accompany the 
application in order for the policy to be issued. The application is a 
part of this flood insurance policy.
    Association means the group of unit owners which manages the 
described Residential Condominium Building.
    Base flood means the flood having a one percent chance of being 
equalled or exceeded in any given year.
    Basement means any area of the building, including any sunken room 
or sunken portion of a room, having its floor subgrade (below ground 
level) on all sides.
    Building means a walled and roofed structure, other than a gas or 
liquid storage tank, that is principally above ground and affixed to a 
permanent site, including a walled and roofed building in the course of 
construction, alteration or repair and a manufactured (i.e., mobile) 
home on a permanent foundation, subject to Article 6, paragraph H.

[[Page 286]]

    Cancellation means that ending of the insurance coverage provided by 
this policy prior to the expiration date.
    Coastal High Hazard Area means an area subject to high velocity 
waters, including hurricane wave wash and tsunamis.
    Coinsurance means that the Insurer's liability for loss under the 
policy shall be in an amount which is of no greater proportion to the 
amount of loss than the amount of insurance which the Insured has 
purchased to cover the property bears, at the time of loss, to the value 
of the insured property under the terms and conditions of this policy, 
provided, if the property is insured at the time of loss in an amount 
equal to the lesser of 80 percent or more of its full replacement cost 
or the maximum amount of insurance available under the National Flood 
Insurance Program, the loss will be adjusted, subject to the policy's 
limit of coverage and all of the other terms and conditions of the 
policy, as if the amount of insurance and the value of the insured 
property are equal.
    Condominium means a system of individual ownership of units in a 
multi-unit building or buildings or in single-unit buildings as to which 
each unit owner in the condominium has an undivided interest in the 
common areas of the building(s) and facilities that serve the 
building(s).
    Declarations Page is a computer generated summary of information 
furnished by the Insured in the application for insurance. The 
declarations page also describes the term of the policy, limits of 
coverage, and displays the premium and the name of the Insurer. The 
declarations page is a part of this flood insurance policy.
    Direct Physical Loss By or From Flood means any loss in the nature 
of actual loss of or physical damage, evidenced by physical changes, to 
the insured property (building or personal property) which is directly 
and proximately caused by a flood (as defined in this policy).
    Elevated Building means a non-basement building which has its lowest 
elevated floor raised above ground level by foundation walls, shear 
walls, posts, piers, pilings, or columns.
    Emergency Program Community means a community wherein a Flood Hazard 
Boundary Map (FHBM) is in effect and only limited amounts of insurance 
are available under the Act.
    Expense Constant means a flat charge per policy term, paid by the 
Insured to defray the Federal Government's policywriting and other 
expenses.
    Expiration Date means the ending of the insurance coverage provided 
by this policy on the expiration date shown on the declarations page.
    Federal policy fee means a flat charge per policy term, paid by the 
Insured to defray certain administrative expenses incurred in carrying 
out the National Flood Insurance Program not covered by the expense 
constant. This fee was established by section 1307(a)(1)(B)(iii) of the 
National Flood Insurance Act of 1968, as amended, 42 U.S.C. 4014, and is 
not subject to producers' commissions, expense allowances, or state or 
local premium taxes.
    Flood means:
    A. A general and temporary condition of partial or complete 
inundation of normally dry land areas from:
    1. The overflow of inland or tidal waters.
    2. The unusual and rapid accumulation or runoff of surface waters 
from any source.
    3. Mudslides (i.e., mudflows) which are proximately caused by 
flooding as defined in subparagraph A-2 above and are akin to a river of 
liquid and flowing mud on the surfaces of normally dry land areas as 
when earth is carried by a current of water and deposited along the path 
of the current.
    B. The collapse or subsidence of land along the shore of a lake or 
other body of water as a result of erosion or undermining caused by 
waves or currents of water exceeding the cyclical levels which result in 
flooding as defined in subparagraph A-1 above.
    Improvements means fixtures, alterations, or additions comprising a 
part of the insured building, including the units within the insured 
building.
    Manufactured home means a building transportable in one or more 
sections, which is built on a permanent chassis and designed to be used 
with or without a permanent foundation when connected to the required 
utilities. The term manufactured home does not include park trailers, 
and other similar vehicles. To be eligible for coverage under this 
policy, a manufactured home must be on a permanent foundation and, if 
located in a FEMA designated Special Hazard Area, must meet the 
requirements of paragraph H. of Article 6.
    Mobile home means a manufactured home.
    National Flood Insurance Program means the program of flood 
insurance coverage and floodplain management administered under the Act 
and applicable Federal regulations in title 44 of the Code of Federal 
Regulations, subchapter B.
    Policy means the entire written contract between the Insured and the 
Insurer, including this printed form, the application, and declarations 
page, any endorsements which may be issued and any renewal certificates 
indicating that coverage has been instituted for a new policy and policy 
term. Only one building, specifically described by the Insured in the 
application, may be insured under this policy, unless application to 
cover more than one building is made on a form or in a format approved 
for that purpose by the Federal Insurance Administrator.

[[Page 287]]

    Post-FIRM building means a building for which the start of 
construction or substantial improvement occurred after December 31, 
1974, or on or after the effective date of the initial Flood Insurance 
Rate Map (FIRM) for the community in which the building is located, 
whichever is later.
    Pre-FIRM rated building means a building for which the start of 
construction or substantial improvement occurred on or before December 
31, 1974, or before the effective date of the initial FIRM for the 
community in which the building is located, whichever is later.
    Probation Additional Premium means a flat charge per policy term 
paid by the Insured on all new and renewal policies issued covering 
property in a community that has been placed on probation under the 
provisions of 44 CFR 59.24.
    Regular Program Community means a community wherein a FIRM is in 
effect and full limits of coverage are available under the Act.
    Residential Condominium Building means a building owned by the 
members of a condominium association containing one or more residential 
units and in which at least 75 percent of the floor area within the 
building is residential.
    Residential Condominium Building Association Policy means a policy 
of flood insurance coverage issued to an Association pursuant to the 
Act.
    Special hazard area means an area having special flood, mudslide 
(i.e., mudflow), and/or flood-related erosion hazards, and shown on a 
FHBM or FIRM as Zone A, AO, A1-30, AE, A99, AH, AR, VO, V1-30, VE, V, M 
or E.
    Unit means a single family dwelling unit, in a Residential 
Condominium Building.
    Valued policy means a policy contract in which the Insurer and the 
Insured agree on the value of the property insured, that value being 
payable in event of total loss.
    Walled and Roofed means the building has in place two or more 
exterior, rigid walls and the roof is fully secured so that the building 
will resist flotation, collapse and lateral movement.

                      Article 3--Losses Not Covered

    The Insurer only provides coverage for direct physical loss by or 
from flood which means the following are not covered:
    A. Compensation, reimbursement or allowance for:
    1. Loss of use of the insured property or premises.
    2. Loss of access to the insured property or premises.
    3. Loss of profits.
    4. Loss resulting from interruption of business, profession, or 
manufacture.
    5. Any additional living expenses incurred while the insured 
building is being repaired or is uninhabitable for any reason.
    6. Any increased cost of repair or reconstruction as a result of any 
ordinance regulating reconstruction or repair except as provided in 
Coverage D--Increased Cost of Compliance.
    7. Any other economic loss.
    B. Losses from other casualties, including loss caused by:
    1. Theft, fire, windstorm, wind, explosion, earthquake, land 
sinkage, landslide, destabilization or movement of land resulting from 
the accumulation of water in subsurface land areas, gradual erosion, or 
any other earth movement except such mudslides (i.e., mudflows) or 
erosion as is covered under the peril of flood.
    2. Rain, snow, sleet, hail or water spray.
    3. Land subsidence, sewer backup, or seepage of water unless, 
subject to additional deductibles as provided for at Article 7, (a) 
there is a general and temporary condition of flooding in the area, (b) 
the flooding is the proximate cause of the land subsidence, sewer 
backup, or seepage of water, (c) the land subsidence, sewer backup, or 
seepage of water damage occurs no later than 72 hours after the flood 
has receded, and (d) the insured building must be insured, at the time 
of the loss, for at least 80 percent of its replacement cost or the 
maximum amount of insurance available under the National Flood Insurance 
Program.
    4. Freezing, thawing, or the pressure or weight of ice or water.
    5. Water, moisture, mildew, mold or mudslide (i.e., mudflow) damage 
resulting primarily from any condition substantially confined to the 
insured building or from any condition which is within the Insured's 
control (including but not limited to design, structural or mechanical 
defects, failures, stoppages or breakages of water or sewer lines, 
drains, pumps, fixtures or equipment).
    C. Losses of the following nature:
    1. A loss which is already in progress as of 12:01 a.m. of the first 
day of the policy term, or, as to any increase in the limits of coverage 
which is requested by the Insured, a loss which is already in progress 
as of 12:01 a.m. on the date when the additional coverage becomes 
effective.
    2. A loss from a flood which is confined to the premises on which 
the insured property is located unless the flood is displaced over two 
acres of the premises.
    3. A loss caused by the Insured's modification to the insured 
property which materially increases the risk of flooding.
    4. A loss caused intentionally by the Insured.
    5. A loss caused by or resulting from power, heating or cooling 
failure, unless such failure results from physical damage to power, 
heating or cooling equipment situated on the premises where the 
described building or unit is located, caused by a flood.

[[Page 288]]

    6. A loss to any building or contents located on property leased 
from the Federal Government, arising from or incident to the flooding of 
the property by the Federal Government where the lease expressly holds 
the Federal Government harmless, under flood insurance issued under any 
Federal Government program, from loss arising from or incident to the 
flooding of the property by the Federal Government.

Article 4--Property Covered (Subject to Articles 3, 5 and 6 Provisions, 
 Which Also Apply to the Other Articles, Terms, and Conditions of This 
                Policy, Including the Insuring Agreement)

                      Coverage A--Building Property

    This policy covers the Residential Condominium Building (the 
building) at the premises which is described in the application, and 
includes:
    1. The entire building, for its real property elements, including 
all units within the building and the improvements within the units.
    2. Additions and extensions attached to and in contact with the 
building by means of a common wall (but see Article 6, paragraph D.2.).
    3. Fixtures, machinery and equipment, including the following 
property, all while within the building, including its units, as to 
which coverage is not provided under ``Coverage B--Personal Property'':
     Furnaces.
     Wall Mirrors Permanently Installed.
     Permanently Installed Corner Cupboards, Bookcases, 
Paneling, and Wallpaper.
     Ventilating Equipment.
     Fire Extinguishing Apparatus.
     Venetian Blinds.
     Central Air Conditioners.
     Awnings and Canopies.
     Elevator Equipment.
     Fire Sprinkler Systems.
     Outdoor Antennas and Aerials.
     Pumps and Machinery for Operating them.
     Carpet Permanently Installed Over Unfinished Flooring.
     In the Units Within the Building, Installed:
     Built-in Dishwashers.
     Garbage Disposal Units.
     Hot Water Heaters.
     Kitchen Cabinets.
     Built-in Microwave Ovens.
     Plumbing Fixtures.
     Radiators.
     Ranges.
     Refrigerators.
     Stoves.
    4. Materials and supplies to be used in constructing, altering or 
repairing the building while stored inside a fully enclosed building:
    a. At the property address; or
    b. On an adjacent property at the time of loss; or
    c. In case of another building at the property address which does 
not have walls on all sides, while stored and secured to prevent 
flotation out of the building during flooding (the flotation out of the 
building shall be deemed to establish the conclusive presumption that 
the materials and supplies were not reasonably secured to prevent 
flotation, in which case no coverage is provided for such materials and 
supplies under this policy).
    5. A building in the course of construction before it is walled and 
roofed subject to the following conditions:
    a. The amount of the deductible for each loss occurrence before the 
building is walled and roofed is two times the Sec. ductible which is 
selected to apply after the building is walled and roofed;
    b. Coverage is provided before the building is walled and roofed 
only while construction is in progress, or if construction is halted, 
only for a period of up to 90 continuous days thereafter, until 
construction is resumed; and
    c. There is no coverage before the building is walled and roofed 
where the lowest floor, including basement floor, of a non-elevated 
building or the lowest elevated floor of an elevated building is below 
the base flood elevation in Zones AH, AE or A1-30 or is below the base 
flood elevation adjusted to include the effect of wave action in Zones 
VE or V1-30. The lowest floor levels are based on the bottom of the 
lowest horizontal structural member of the floor in Zones VE or V1-30 
and the top of the floor in Zones AH, AE or A1-30.

                      Coverage B--Personal Property

    A. Subject to paragraphs B. and C. below, this policy covers 
personal property which is in or on the insured, fully enclosed building 
and is:
    1. Owned by the unit owners of the condominium in common, i.e., as 
to which each unit owner has an undivided ownership interest; or
    2. Owned solely by the Condominium Association and used exclusively 
in the conduct of the business affairs of the condominium.
    3. Such personal property is also covered while stored at a 
temporary location, as expressly authorized under this policy (see 
Article 5, paragraph B.2.).
    B. Coverage for personal property includes the following property, 
whether owned by the Association or unit owner and subject to paragraph 
A. 1. and 2., above, for which coverage is not provided (irrespective of 
the manner in which the property is installed in or adapted to the 
building) under ``Coverage A--Building Property'':
     Clothes Washers.
     Clothes Dryers.
     Food Freezers.

[[Page 289]]

     Air Conditioning Units Installed in the Building.
     Portable Dishwashers.
     Carpet, including wall-to-wall carpet, over finished 
flooring and whether or not it is permanently installed.
     Carpet not permanently installed over unfinished flooring.
     Outdoor equipment and furniture stored inside the dwelling 
or another fully enclosed building at the property address.
     Portable microwave ovens and ``cook-out'' grills, ovens and 
the like.
    C. Limitations. Under this ``Coverage B--Personal Property'', the 
Insured shall not be reimbursed for loss as to the following personal 
property to the extent the loss to any one or more of such property 
exceeds, individually or in total, $250.00:
     Artwork, including but not limited to, paintings, etchings, 
pictures, tapestries, art glass windows including their frames, 
statuary, marbles, and bronzes;
     Rare books;
     Necklaces, bracelets, gems, precious or semi-precious 
stones, watches, articles of gold, silver, or platinum; or
     Furs or any article containing fur which represents its 
principal value.

                       Coverage C--Debris Removal

    This insurance covers expense incurred in the removal of debris of, 
or on, or from the building or personal property covered hereunder, 
which may be occasioned by loss caused by a flood. Under these 
provisions coverage extends to:
    1. Non-owned debris from beyond the boundaries of the described 
premises which is physically on the insured property (i.e., on the 
building or the personal property).
    2. Parts of the insured property anywhere:
    a. On the described premises; and
    b. On property beyond the boundaries of the described premises.
    The total liability under this policy for both loss to property and 
debris removal expense shall not exceed the amount of insurance applying 
under this policy to the property covered.

            Coverage D--Increased Cost of Compliance Coverage

    Increased Cost of Compliance coverage (Coverage D) is for the 
consequential loss brought on by a floodplain management ordinance or 
law affecting repair and reconstruction involving elevation, 
floodproofing, relocation, or demolition (or any combination thereof) of 
a structure, after a direct loss caused by a ``flood'' as defined by 
this policy. (Floodproofing activities eligible for Coverage D and 
referred to hereafter in this policy are limited to residential 
structures with basements that satisfy the criteria of 44 CFR 60.6 (b) 
or (c) and to non-residential structures.)
    The limit of liability under this Coverage D (Increased Cost of 
Compliance) will not exceed $15,000. This coverage is only applicable to 
policies with building coverage (Coverage A) and is in addition to the 
Building limit you selected on your application, and appears on the 
Declarations Page. No separate deductible applies. The maximum amount 
collectible under this policy for both Coverage A (Building Property) 
and Coverage D (Increased Cost of Compliance), however, cannot exceed 
the maximum permitted under the Act.
    Eligibility
    A structure covered under Coverage A--Building Property--sustaining 
a loss caused by a ``flood'' as defined by this policy must:
    1. Be a structure that is a repetitive loss structure. A repetitive 
loss structure means a structure, covered by a contract for flood 
insurance issued pursuant to the Act, that has incurred flood-related 
damage on 2 occasions during a 10-year period ending on the date of the 
event for which a second claim is made, in which the cost of repairing 
the flood damage, on the average, equaled or exceeded 25% of the market 
value of the structure at the time of each such flood event. In addition 
to the current claim, the National Flood Insurance Program must have 
paid the previous qualifying claim, and the State or community must have 
a cumulative, substantial damage provision or repetitive loss provision 
in its flood plain management law or ordinance being enforced against 
the structure; or
    2. Be a structure that has had flood damage in which the cost to 
repair equals or exceeds 50% of the market value of the structure at the 
time of the flood event. The State or community must have a substantial 
damage provision in its floodplain management law or ordinance being 
enforced against the structure.
    This Coverage D will not pay for Increased Cost of Compliance to 
meet State or community floodplain management laws or ordinances which 
exceed the minimum criteria at 44 CFR 60.3, except as provided in 1. 
above or a. or b. as follows:
    a. Elevation or floodproofing in any risk zone to preliminary or 
advisory base flood elevations provided by FEMA which the State or local 
government has adopted and is enforcing for flood-damaged structures in 
such areas. (This includes compliance activities in B, C, X, or D zones 
which are being changed to zones with base flood elevations. This also 
includes compliance activities in zones where base flood elevations are 
being increased, and a flood-damaged structure must comply with the 
higher advisory base flood elevation.) Increased Cost of Compliance 
coverage does not respond to situations in B, C, X, or D zones where the 
community

[[Page 290]]

has derived its own elevations and is enforcing elevation or 
floodproofing requirements for flood-damaged structures to elevations 
derived solely by the community.
    b. Elevation or floodproofing above the base flood elevation to meet 
State or local ``freeboard'' requirements, i.e., that a structure must 
be elevated above the base flood elevation.
    Under the minimum NFIP criteria at 44 CFR 60.3(b)(4), States and 
communities must require the elevation or floodproofing of structures to 
the base flood elevation where elevation data are obtained from a 
Federal, State, or other source. Such compliance activities are also 
eligible for this Coverage D.
    This coverage will also pay for the incremental cost, after 
demolition, or relocation, of elevating or floodproofing a structure 
during its rebuilding at the same or another site to meet State or local 
floodplain management laws or ordinances, subject to Exclusion (7).
    This coverage will also pay to bring a flood-damaged structure into 
compliance with State or local floodplain management laws or ordinances 
even if the structure had received a variance before the present loss 
from the applicable floodplain management requirements.
    Conditions
    (1) When a structure covered under Coverage A--Building Property--
sustains a loss caused by a ``flood'' as defined by this policy, our 
payment for the loss under this Coverage D will be for the increased 
cost to elevate, floodproof, relocate, demolish, or any combination 
thereof, caused by enforcement of current State or local floodplain 
management ordinances or laws. Our payment for eligible demolition 
activities will be for the cost to demolish and clear the site of the 
building or a portion thereof caused by enforcement of current State or 
local floodplain management ordinances or laws. Eligible activities for 
the cost of clearing the site will include those necessary to 
discontinue utility service to the site and ensure proper abandonment of 
on-site utilities.
    (2) When the building is repaired or rebuilt, it must be intended 
for the same occupancy as the present building unless otherwise required 
by current floodplain management ordinances or laws.
    Exclusions
    Under this Coverage D (Increased Cost of Compliance), we will not 
pay for:
    (1) The cost associated with enforcement of any floodplain 
management ordinance or law in communities participating in the 
Emergency Program.
    (2) The cost associated with enforcement of any ordinance or law 
that requires any insured or others to test for, monitor, clean up, 
remove, contain, treat, detoxify or neutralize, or in any way respond 
to, or assess the effects of pollutants. Pollutants include but are not 
limited to any solid, liquid, gaseous or thermal irritant or 
contaminant, including smoke, vapor, soot, fumes, acid, alkalis, 
chemicals and waste. Waste includes but is not limited to materials to 
be recycled, reconditioned or reclaimed.
    (3) The loss in value to any covered building or other structure due 
to the requirements of any ordinance or law.
    (4) The loss in residual value of the undamaged portion of a 
building demolished as a consequence of enforcement of any State or 
local floodplain management law or ordinance.
    (5) Any increased cost of compliance under this Coverage D:
    (a) Until the covered building is actually elevated, floodproofed, 
demolished or relocated on the same or to another premises; and
    (b) Unless the covered building is elevated, floodproofed, 
demolished, or relocated as soon as reasonably possible after the loss, 
not to exceed two years.
    (6) For any code upgrade requirements, e.g., plumbing or electrical 
wiring, not specifically related to the State or local floodplain 
management law or ordinance.
    (7) For any compliance activities needed to bring additions or 
improvements made after the loss occurred into compliance with State or 
local floodplain management laws or ordinances.
    (8) Loss due to any ordinance or law that you were required to 
comply with before the current loss.
    (9) For any rebuilding activity to standards that do not meet the 
NFIP's minimum requirements. This includes any situation where the 
insured has received from the State or community a variance in 
connection with the current flood loss to rebuild the property to an 
elevation below the base flood elevation.
    (10) For any structure insured under a Group Flood Insurance Policy 
issued pursuant to 44 CFR 61.17.
    Other Provisions
    (1) Increased Cost of Compliance coverage will not be included in 
the calculation to determine whether coverage meets the 80% replacement 
cost requirement under Article 9 or for payment under Article 3.B.3 for 
loss from land subsidence, sewer backup, or seepage of water.
    (2) All other conditions and provisions of the policy apply.

    Article 5--Special Provisions Applicable to Coverages A, B, and C

    A. This policy is not a valued policy. Loss will be paid, provided 
the Insured has purchased a sufficient amount of coverage, i.e., in an 
amount equal to the lesser of the value of the damaged property under 
the terms and conditions of this policy (and regardless of whether the 
amount of insurance purchased

[[Page 291]]

is greater than such value) or the limit of coverage permitted under the 
Act.
    B. Insured Property, Covered Locations. The building and personal 
property are covered while the property is located:
    1. At the property address shown on the application; and
    2. For 45 days at another place above ground level or outside of the 
special hazard area, to which any of the insured property shall 
necessarily be removed in order to protect and preserve it from flood, 
due to the imminent danger of flood (provided, personal property so 
removed must be placed in a fully enclosed building or otherwise 
reasonably protected from the elements to be insured against loss), in 
which case the reasonable expenses incurred by the Insured, including 
the value of its own labor at prevailing Federal minimum wage rates, in 
moving any of the insured property temporarily away from the peril of 
flood shall be reimbursed in an amount not to exceed $500.00. This 
policy's deductible amounts, as provided for at Article 7, shall not be 
applied to this reimbursement, but shall be applied to any other 
benefits under this policy's coverage.
    C. Coverage For Certain Loss Mitigation Measures. When the insurance 
under this policy covers a building, reasonable expenses incurred by the 
Insured for the purchase of the following items are also covered, in an 
aggregate amount not to exceed $750.00:
    1. Sandbags, including sand to fill them and plastic sheeting and 
lumber used in connection with them;
    2. Fill for temporary levees;
    3. Pumps; and
    4. Wood;

all for the purpose of saving the building due to the imminent danger of 
a flood loss, including the value of the Insured's own labor at 
prevailing Federal minimum wage rates.
    The policy's building deductible amount, as provided for at Article 
7, shall not be applied to this reimbursement, but shall be applied to 
any other benefits under the policy's building coverage.
    For reimbursement under this paragraph C. to apply, the following 
conditions must be met:
    a. The insured property must be in imminent danger of sustaining 
flood damage; and
    b. The threat of flood damage must be of such imminence as to lead a 
person of common prudence to apprehend flood damage; and
    c. A general and temporary condition of flooding in the area must 
occur, even if the flooding does not reach the insured property, or a 
legally authorized official must issue an evacuation order or other 
civil order for the community in which the insured property is located 
calling for measures to preserve life and property from the peril of 
flood.

                     Article 6--Property Not Covered

    This policy shall not cover any of the following:
    A. Valuables and commercial property, meaning:
    1. Accounts, bills, currency, deeds, evidences of debt, money, 
coins, medals, postage stamps, securities, bullion, manuscripts, other 
valuable papers or records, and personal property used in a business.
    2. Personal property used in connection with any incidental 
commercial occupancy or use of the building.
    B. Property over water or in the open, meaning:
    1. A building and personal property in the building located entirely 
in, on, or over water or seaward of mean high tide, if the building was 
newly constructed or substantially improved on or after October 1, 1982.
    2. Personal property in the open.
    C. Structures other than buildings, including:
    1. Fences, retaining walls, seawalls, bulkheads, wharves, piers, 
bridges, and docks.
    2. Indoor and outdoor swimming pools.
    3. Open structures and personal property located in, on, or over 
water, including boat houses or any structure or building into which 
boats are floated.
    4. Underground structures and equipment, including wells, septic 
tanks and septic systems.
    D. Other real property, including:
    1. Land, land values, lawns, trees, shrubs, plants, and growing 
crops.
    2. Those portions of walks, walkways, decks, driveways, patios, and 
other surfaces, all whether covered or not and all of whatever kind of 
construction, located outside the perimeter, exterior walls of the 
insured building.
    E. Other personal property, meaning:
    1. Animals, livestock, birds, and fish.
    2. Aircraft.
    3. Any self-propelled vehicle or machine and motor vehicle (other 
than motorized equipment pertaining to the service of the described unit 
or building, operated principally on the premises of the Insured, and 
not licensed for highway use) including their parts and equipment.
    4. Trailers on wheels and other recreational vehicles whether 
affixed to a permanent foundation or on wheels.
    5. Watercraft including their furnishings and equipment.
    6. Personal property owned by or in the care, custody or control of 
a unit owner, except for the property described in Article 4 under 
``Coverage B--Personal Property'', paragraph B. of this policy.
    F. Basements, building enclosures lower than the elevated floors of 
elevated buildings, and personal property as follows:
    1. In a special hazard area, at an elevation lower than the lowest 
elevated floor of an

[[Page 292]]

elevated Post-FIRM building, including a manufactured (i.e., mobile) 
home:
    a. Personal property.
    b. Building enclosures, equipment, machinery, fixtures and 
components, except for the required utility connections and the 
footings, foundation, posts, pilings, piers or other foundation walls 
and anchorage system as required for the support of the building.
    2. In a basement as defined in Article 2:
    a. Personal property.
    b. Building equipment, machinery, fixtures and components, including 
finished walls, floors, ceilings and other improvements, except for the 
required utility connections, fiberglass insulation, drywalls and 
sheetrock walls, and ceilings but only to the extent of replacing 
drywalls and sheetrock walls in an unfinished manner (i.e., nailed to 
framing but not taped, painted, or covered).
    3. Provided, with regard to both 1. and 2., above, the following 
building and personal property items connected to a power source and 
installed in their functioning location are covered so long as the 
Insured has purchased building and personal property coverage, as 
appropriate:
     Sump pumps.
     Well water tanks and pumps.
     Oil tanks and the oil in them.
     Cisterns and the water in them.
     Natural gas tanks and the gas in them.
     Pumps and/or tanks used in conjunction with solar energy.
     Furnaces.
     Hot water heaters.
     Clothes washers and dryers.
     Food freezers and the food in them.
     Air conditioners.
     Heat pumps.
     Electrical junction and circuit breaker boxes.
     Stairways and staircases attached to the building which are 
not separated from the building by elevated walkways.
     Clean-up.
     Elevators, dumbwaiters, and relevant equipment, except for 
such relevant equipment located below the base flood elevation if such 
relevant equipment was installed on or after October 1, 1987.
    G. Property below ground, meaning a building or unit and its 
contents, including personal property and machinery and equipment, which 
are part of the building or unit, where more than 49 percent of the 
actual cash value of such building or unit is below ground, unless the 
lowest level is at or above the base flood elevation by reason of earth 
having been used as an insulation material in conjunction with energy 
efficient building techniques.
    H. Certain manufactured homes, meaning a manufactured (i.e., mobile) 
home located or placed within a FEMA designated Special Hazard Area that 
is not anchored to a permanent foundation to resist flotation, collapse, 
or lateral movement:
    1. By over-the-top or frame ties to ground anchors; or
    2. In accordance with manufacturer's specifications; or
    3. In compliance with the community's floodplain management 
requirements;
unless it is a manufactured (i.e., mobile) home on a permanent 
foundation continuously insured by the National Flood Insurance Program 
at the same site at least since September 30, 1982.
    I. Containers such as but not limited to gas tanks or liquid tanks.
    J. Buildings and their contents made ineligible for flood insurance 
pursuant to the provisions of the Coastal Barrier Resources Act, 16 
U.S.C. 3501 et seq., and the Coastal Barrier Improvement Act of 1990, 
Pub. L. 101-591, 16 U.S.C. 3501 et seq.

                         Article 7--Deductibles

    A. Each loss to the insured property is subject to a deductible 
provision under which the Insured bears a portion of the loss before 
payment is made under the policy.
    B. The loss deductible shall apply separately to each building and 
personal property coverage loss including, as to each, any appurtenant 
structure loss and debris removal expense.
    C. For any flood insurance policy issued or renewed for any property 
located in Zones A, AO, AH, A1-30, AE, VO, V1-30, VE, or V where the 
rates available for buildings built before the effective date of the 
initial Flood Insurance Rate Map or December 31, 1974, whichever is 
later, are used to compute the premium, the amount of the deductible for 
each loss occurrence is determined as follows: The Insurer shall be 
liable only when such loss exceeds $750.00, or the amount of any higher 
deductible which the Insured selected when it applied for this policy or 
subsequently by endorsement.
    D. For policies other than those described in paragraph C. above, 
the amount of the deductible for each loss occurrence is determined as 
follows: The Insurer shall be liable only when such loss exceeds 
$500.00, or the amount of any higher deductible which the Insured 
selected when it applied for this policy or subsequently by endorsement.
    E. Notwithstanding the applicable deductible in paragraphs C. or D. 
above, an additional deductible in the sum of $250.00 shall apply 
separately to each building and contents loss before payment is made 
under the policy for land subsidence, sewer backup, or seepage of water 
as provided for in Article 3, paragraph B.3.

[[Page 293]]

    Article 8--Replacement Cost Coverage (For Building Coverage Only)

    Subject to Articles 7 and 9, this policy will, in the event of a 
loss for which there is coverage and subject to the limits of building 
coverage purchased, pay the full cost of repair or replacement of the 
damaged parts of the building without deduction for depreciation. Under 
this Article:
    A. The following outdoor property, whether attached to the insured 
building or not, are excluded from Replacement Cost Coverage: Antennas, 
aerials, carpeting, awnings, appliances, and other outdoor equipment.
    B. Carpeting inside the insured building and laid over or affixed to 
finished or unfinished flooring is excluded from Replacement Cost 
Coverage.
    C. The Insurer's liability for loss under this policy shall not 
exceed the smallest of the following amounts:
    1. The limit of liability of this policy applicable to the damaged 
or destroyed building; or
    2. The cost to repair or replace the building or any part thereof 
with material of like kind and quality on the same premises and intended 
for the same occupancy and use; or
    3. The amount actually and necessarily expended in repairing or 
replacing said building or any part thereof intended for the same 
occupancy and use.
    D. The Insurer shall not be liable for any loss on a Replacement 
Cost Coverage basis unless and until actual repair or replacement of the 
damaged building, or parts thereof, is completed.
    E. These Replacement Cost Provisions do not apply to any 
manufactured (i.e., mobile) home which when assembled is not at least 16 
feet wide or does not have an area within its perimeter walls of at 
least 600 square feet nor do they apply to any loss where insured 
property is abandoned and remains as debris at the property address 
following a loss.
    F. If the building sustains a total loss or if the Insurer should 
pay the entire building loss proceeds under these Replacement Cost 
Provisions, there is no requirement that the building be rebuilt at the 
insured property address.

           Article 9--Coinsurance (For Building Coverage Only)

    A. In consideration of the rate and form under which this policy is 
written, it is expressly stipulated and made a condition of this 
contract that the Insurer's liability for loss under this policy shall 
be in an amount which is of no greater proportion to the amount of loss 
than the amount of insurance which the Insured has purchased to cover 
the insured property bears, at the time of loss, to the replacement cost 
value of the insured property, as follows:
    1. If at the time of loss the total amount of insurance applicable 
to the insured property is the lesser of 80 percent or more of the full 
replacement cost of the insured property or the maximum amount of 
insurance available under the National Flood Insurance Program, the loss 
will be adjusted, subject to the policy's limit of coverage and all of 
the other terms and conditions of this policy, as if the amount of 
insurance and the value of the insured property are equal.
    2. If at the time of loss the Insured has not purchased the maximum 
amount of insurance available under the National Flood Insurance 
Program, or if the replacement cost value of the covered property at the 
time of the loss times 80 percent is greater than the amount of 
insurance purchased to cover the property, the full cost of replacement 
or repair of the insured property, subject to the terms and conditions 
of this policy, arising out of a covered loss, shall not be paid and 
payment shall be made as follows:
    To the extent the Insured has not purchased insurance in an amount 
equal to the lesser of 80 percent or more of the full replacement cost 
of the insured property at the time of loss or the maximum amount of 
insurance available under the National Flood Insurance Program, the 
Insured will not be reimbursed fully for a loss. The amount of loss to 
be paid in such cases shall be determined in accordance with the 
following formula:
[GRAPHIC] [TIFF OMITTED] TR26NO93.000

    a. Example 1: The insurance carried is $500,000.00, the replacement 
cost value of the building is $1,000,000.00 (which is available under 
the National Flood Insurance Program) and the amount of the loss is 
$240,000.00. The formula is applied as follows:

[[Page 294]]

[GRAPHIC] [TIFF OMITTED] TR26NO93.001


*($150,000 Less Deductible) The balance of the loss in the sum of 
$90,500.00 is not covered.
    b. Example 2: The insurance carried is $1,850,000.00, the 
replacement cost value of the building is $2,000,000.00 and the amount 
of loss is $1,000,000.00. The formula is not applied because $1,850,000 
exceeds $1,600,000 ($2,000,000 x 80%). The Insured is paid the full 
amount of the loss ($1 Million).
    B. In determining if the whole amount of insurance applicable to the 
building is 80 percent or more of the full replacement cost of such 
building:
    1. The replacement cost value of any covered building property 
described in Article 4 shall be included and the replacement cost value 
of any building property described in Article 4 which constitutes 
property not covered under this policy shall not be included.
    2. Regarding improvements, only the replacement cost value of 
improvements installed by the Association shall be included.

              Article 10--General Conditions and Provisions

    A. Pair and Set Clause: If there is loss of an article which is part 
of a pair or set, the measure of loss shall be a reasonable and fair 
proportion of the total value of the pair or set, giving consideration 
to the importance of said article, but such loss shall not be construed 
to mean total loss of the pair or set.
    B. Concealment, Fraud: This policy shall be void, nor can this 
policy be renewed or any new flood insurance coverage be issued to the 
Insured if any person insured under Article 1, paragraph A., whether 
before or after a loss, has:
    1. Sworn falsely, or willfully concealed or misrepresented any 
material fact; or
    2. Done any fraudulent act concerning this insurance (see paragraph 
E.1.d. below); or
    3. Willfully concealed or misrepresented any fact on a 
``Recertification Questionnaire,'' which causes the Insurer to issue a 
policy based on a premium amount which is less than the premium amount 
which would have been payable were it not for the misstatement of fact 
(see paragraph F. below).
    C. Other Insurance: If a loss covered by this policy is also covered 
by other insurance, whether collectible or not, the Insurer will pay 
only the proportion of the loss that the limit of liability that applies 
under this policy bears to the total amount of insurance covering the 
loss, provided, if at the time of loss, there is other insurance made 
available under the Act, in the name of a unit owner which provides 
coverage for the same loss covered by this policy, this policy's 
coverage shall be primary and not contributing with such other 
insurance.
    D. Amendments and Waivers, Assignment: This Standard Flood Insurance 
Policy cannot be amended nor can any of its provisions be waived without 
the express written consent of the Federal Insurance Administrator. No 
action the Insurer takes under the terms of this policy can constitute a 
waiver of any of its rights. Except in the case of 1. a contents only 
policy and 2. a policy issued to cover a building in the course of 
construction, assignment of this policy, in writing, is allowed upon 
transfer of title.
    E. Voidance, Reduction or Reformation of the Coverage:
    1. Voidance: This policy shall be void and of no legal force and 
effect in the event that any one of the following conditions occurs:
    a. The property listed on the application is not eligible for 
coverage, in which case the policy is void from its inception;
    b. The community in which the property is located was not 
participating in the National Flood Insurance Program on the policy's 
inception date and did not qualify as a participating community during 
the policy's term and before the occurrence of any loss;
    c. If, during the term of the policy, the participation in the 
National Flood Insurance Program of the community in which the property 
is located ceases, in which case the policy shall be deemed void 
effective at the end of the last day of the policy year in which such 
cessation occurred and shall not be renewed.
    In the event the voided policy included 3 policy years in a contract 
term of 3 years, the Insured shall be entitled to a pro-rata refund of 
any premium applicable to the remainder of the policy's term;
    d. In the event any Insured or its agent has:
    (1) Sworn falsely; or
    (2) Fraudulently or willfully concealed or misrepresented any 
material fact including facts relevant to the rating of this policy in 
the application for coverage, or upon any renewal of coverage, or in 
connection with the submission of any claim brought under the policy, in 
which case this entire policy shall be void as of the date the wrongful 
act was committed or from its inception if this policy is a renewal 
policy and the wrongful act occurred in connection with an application 
for or renewal or endorsement of a policy issued to the Insured in a 
prior year and affects the rating of or premium amount received for this 
policy. Refunds of premiums, if any, shall be subject to offsets for the 
Insurer's

[[Page 295]]

administrative expenses (including the payment of agent's commissions 
for any voided policy year) in connection with the issuance of the 
policy;
    e. The premium submitted is less than the minimum set forth in 44 
CFR 61.10 in connection with any application for a new policy or policy 
renewal, in which case the policy is void from its inception date.
    2. Reduction of Coverage Limits or Reformation: In the event that 
the premium payment is not sufficient (whether evident or not) to 
purchase the amount of coverage requested by an application, renewal, 
endorsement, or other form and paragraph E.1.d. does not apply, then the 
policy shall be deemed to provide only such coverage as can be purchased 
for the entire term of the policy, for the amount of premium received, 
subject to increasing the amount of coverage pursuant to 44 CFR 61.11; 
provided, however:
    a. If the insufficient premium is discovered by the Insurer prior to 
a loss and the Insurer can determine the amount of insufficient premium 
from information in its possession at the time of its discovery of the 
insufficient premium, the Insurer shall give a notice of additional 
premium due, and if the Insured remits and the Insurer receives the 
additional premium required to purchase the limits of coverage for each 
kind of coverage as was initially requested by the Insured within 30 
days from the date the Insurer gives the Insured written notice of 
additional premium due, the policy shall be reformed, from its inception 
date, or, in the case of an endorsement, from the effective date of the 
endorsement, to provide flood insurance coverage in the amount of 
coverage initially requested.
    b. If the insufficient premium is discovered by the Insurer at the 
time of a loss under the policy, the Insurer shall give a notice of 
premium due, and if the Insured remits and the Insurer receives the 
additional premium required to purchase (for the current policy term and 
the previous policy term, if then insured) the limits of coverage for 
each kind of coverage as was initially requested by the Insured within 
30 days from the date the Insurer gives the Insured written notice of 
additional premium due, the policy shall be reformed, from its inception 
date, or, in the case of an endorsement, from the effective date of the 
endorsement, to provide flood insurance coverage in the amount of 
coverage initially requested.
    c. Under subparagraphs a. and b. as to any mortgagee or trustee 
named in the policy, the Insurer shall give a notice of additional 
premium due and the right of reformation shall continue in force for the 
benefit only of the mortgagee or trustee, up to the amount of the 
Insured's indebtedness, for 30 days after written notice to the 
mortgagee or trustee.
    F. Policy Renewal: The term of this policy commences on its 
inception date and ends on its expiration date, as shown on the 
declarations page which is attached to the policy. The Insurer is under 
no obligation to:
    1. Send the Insured any renewal notice or other notice that the 
policy term is coming to an end and the receipt of any such notice by 
the Insured shall not be deemed to be a waiver of this provision on the 
Insurer's part.
    2. Assure that policy changes reflected in endorsements submitted 
during the policy term are included in any renewal notice or new policy 
sent to the Insured. Policy changes includes the addition of any 
increases in the amounts of coverage.
    This policy shall not be renewed and the coverage provided by it 
shall not continue into any successive policy term unless the renewal 
premium payment is received by the Insurer at the office of the National 
Flood Insurance Program within 30 days of the expiration date of this 
policy, subject to paragraph E. above. If the renewal premium payment is 
mailed by certified mail to the Insurer prior to the expiration date, it 
shall be deemed to have been received within the required 30 days. The 
coverage provided by the renewal policy is in effect for any loss 
occurring during this 30-day period even if the loss occurs before the 
renewal premium payment is received, so long as the renewal premium 
payment is received within the required 30 days. In all other cases, 
this policy shall terminate as of the expiration date of the last policy 
term for which the premium payment was timely received and in that 
event, the Insurer shall not be obligated to provide the Insured with 
any cancellation, termination, policy lapse, or policy renewal notice.
    In connection with the renewal of this policy, the Insured may be 
requested during the policy term to recertify, on a Recertification 
Questionnaire the Insurer will provide, the rating information used to 
rate the most recent application for or renewal of insurance.
    Notwithstanding the Insured's responsibility to submit the 
appropriate renewal premium in sufficient time to permit its receipt by 
the Insurer prior to the expiration of the policy being renewed, the 
Insurer has established a business procedure for mailing renewal notices 
to assist Insureds in meeting their responsibility. Regarding the 
business procedure, evidence of the placing of any such notices into the 
U.S. Postal Service, addressed to the Insured at the address appearing 
on its most recent application or other appropriate form (received by 
the Insurer prior to the mailing of the renewal notice), does, in all 
respects, for purposes of the National Flood Insurance Program, 
presumptively establish delivery to the Insured for all purposes 
irrespective of whether the Insured actually received the notice.

[[Page 296]]

    However, in the event the Insurer determines that, through any 
circumstances, any renewal notice was not placed into the U.S. Postal 
Service, or, if placed, was prepared or addressed in a manner which the 
Insurer determines could preclude the likelihood of its being actually 
and timely received by the Insured prior to the due date for the renewal 
premium, the following procedures shall be followed:
    In the event that the Insured or its agent notified the Insurer, not 
later than 1 year after the date on which the payment of the renewal 
premium was due, of a nonreceipt of a renewal notice prior to the due 
date for the renewal premium, which the Insurer determines was 
attributable to the above circumstance, the Insurer shall mail a second 
bill providing a revised due date, which shall be 30 days after the date 
on which the bill is mailed.
    If the renewal payment requested by reason of the second bill is not 
received by the revised due date, no renewal shall occur and the policy 
shall remain as an expired policy as of the expiration date prescribed 
on the policy.
    G. Conditions Suspending or Restricting Insurance: Unless otherwise 
provided in writing added hereto, the Insurer shall not be liable for 
loss occurring while the hazard is increased by any means within the 
control or knowledge of the Insured.
    H. Liberalization clause: If during the period that insurance is in 
force under this policy or within 45 days prior to the inception date 
thereof, should the Insurer have adopted under the Act, any forms, 
endorsements, rules or regulations by which this policy could be 
extended or broadened, without additional premium charge, by endorsement 
or substitution of form, then, such extended or broadened insurance 
shall inure to the benefit of the Insured as though such endorsement or 
substitution of form had been made. Any broadening or extension of this 
policy to the Insured's benefit shall only apply to losses occurring on 
or after the effective date of the adoption of any forms, endorsements, 
rules or regulations affecting this policy.
    I. Alterations and Repairs: The Insured may, at the Insured's own 
expense, make alterations, additions and repairs, and complete 
structures in the course of construction.
    J. Cancellation of Policy By Insured: The Insured may cancel this 
policy at any time but a refund of premium money will only be made when:
    1. The Insured cancels a policy having a term of 3 years, on an 
anniversary date, and the reason for the cancellation is that:
    a. A policy of flood insurance has been obtained or is being 
obtained in substitution for this policy and the Insurer has received a 
written concurrence in the cancellation from any mortgagee of which the 
Insurer has actual notice, or
    b. The Insured has extinguished the insured mortgage debt and is no 
longer required by the mortgagee to maintain the coverage. Refund of any 
premium, under this subparagraph 1., shall be pro rata but with 
retention of the expense constant and the Federal policy fee.
    2. The Insured cancels because the Insurer has determined that the 
property is not, in fact, in a special hazard area; and the Insured was 
required to purchase flood insurance coverage by a private lender or 
Federal agency pursuant to Public Law 93-234, section 102 and the lender 
or agency no longer requires the retention of the coverage. In this 
event, if no claims have been paid or are pending, the premium payments 
will be refunded in full, according to applicable National Flood 
Insurance Program regulations.
    K. Loss Clause: Payment of any loss under this policy shall not 
reduce the amount of insurance applicable to any other loss during the 
policy term which arises out of a separate occurrence of the peril 
insured against hereunder; provided, that all loss arising out of a 
continuous or protracted occurrence shall be deemed to constitute loss 
arising out of a single occurrence.
    L. Mortgage Clause: (Applicable to building coverage only and 
effective only when the policy is made payable to a mortgagee or trustee 
named in the application and declarations page attached to this policy 
or of whom the Insurer has actual notice prior to the payment of loss 
proceeds under this policy.)
    Loss, if any, under this policy, shall be payable to the aforesaid 
as mortgagee or trustee as interest may appear under all present or 
future mortgages upon the property described in which the aforesaid may 
have an interest as mortgagee or trustee, in order of precedence of said 
mortgages, and this insurance, as to the interest of the mortgagee or 
trustee only therein, shall not be invalidated:
    1. By any act or neglect of the mortgagor or owner of the described 
property; nor
    2. By any foreclosure or other proceedings or notice of sale 
relating to the property; nor
    3. By any change in the title or ownership of the property; nor
    4. By the occupation of the premises for purposes more hazardous 
than are permitted by this policy, provided, that it in case the 
mortgagor or owner shall neglect to pay any premium due under this 
policy, the mortgagee or trustee shall, on demand, pay the same.
    Provided, also, that the mortgagee or trustee shall notify the 
Insurer of any change of ownership or occupancy of the building or 
increase of hazard which shall come to the knowledge of said mortgagee 
or trustee and, unless permitted by this policy, it shall be noted 
thereon and the mortgagee or trustee shall, on demand, pay the premium 
for such increased hazard for the term of the use

[[Page 297]]

thereof; otherwise, this policy shall be null and void.
    If this policy is cancelled by the Insurer, it shall continue in 
force for the benefit of the mortgagee or trustee for 30 days after 
written notice to the mortgagee or trustee of such cancellation and 
shall then cease.
    Whenever the Insurer shall pay the mortgagee or trustee any sum for 
loss under this policy and shall claim that, as to the mortgagor or 
owner, no liability therefor existed, the Insurer shall, to the extent 
of such payment, be thereupon legally subrogated to all the rights of 
the party to whom such payment shall be made, under all securities held 
as collateral to the mortgage debt, or may, at its option, pay to the 
mortgagee or trustee the whole principal due or to grow due on the 
mortgage with interest, and shall thereupon receive a full assignment 
and transfer of the mortgage and of all such other securities, but no 
subrogation shall impair the right of the mortgagee or trustee to 
recover the full amount of said mortgagee's or trustee's claim.
    M. Mortgagee Obligations: If the Insured fails to render proof of 
loss, the named mortgagee or trustee, upon notice, shall render proof of 
loss in the form herein specified within 60 days thereafter and shall be 
subject to the provisions of this policy relating to appraisal and time 
of payment and of bringing suit.
    N. Loss Payable Clause (Applicable to contents items only): Loss, if 
any, shall be adjusted with the Insured and shall be payable to the 
Insured and loss payee as their interests may appear.
    O. Requirements in Case of Loss: Should a flood loss occur to the 
insured property, the Insured must:
    1. Notify the Insurer in writing as soon as practicable;
    2. As soon as reasonably possible, separate the damaged and 
undamaged property, putting it in the best possible order so that the 
Insurer may examine it; and
    3. Within 60 days after the loss, send the Insurer a proof of loss, 
which is the Insured's statement as to the amount it is claiming under 
the policy signed and sworn to by the Insured and furnishing the 
following information:
    a. The date and time of the loss;
    b. A brief explanation of how the loss happened;
    c. The Insured's interest in the property damaged (for example, 
``owner'') and the interests, if any, of others in the damaged property;
    d. The actual cash value or replacement cost, whichever is 
appropriate, of each damaged item of insured property and the amount of 
damages sustained;
    e. The names of mortgagees or anyone else having a lien, charge or 
claim against the insured property;
    f. Details as to any other contracts of insurance covering the 
property, whether valid or not;
    g. Details of any changes in ownership, use, occupancy, location or 
possession of the insured property since the policy was issued;
    h. Details as to who occupied any insured building at the time of 
loss and for what purpose; and
    i. The amount the Insured claims is due under this policy to cover 
the loss, including statements concerning:
    (1) The limits of coverage stated in the policy; and
    (2) The cost to repair or replace the damaged property (whichever 
costs less).
    4. Cooperate with the Insurer's adjuster or representative in the 
investigation of the claim;
    5. Document the loss with all bills, receipts, and related documents 
for the amount being claimed;
    6. The insurance adjuster whom the Insurer hires to investigate the 
claim may furnish the Insured with a proof of loss form, and she or he 
may help the Insured to complete it. However, this is a matter of 
courtesy only, and the Insured must still send the Insurer a proof of 
loss within 60 days after the loss even if the adjuster does not furnish 
the form or help the Insured complete it. In completing the proof of 
loss, the Insured must use its own judgment concerning the amount of 
loss and the justification for the amount.
    The adjuster is not authorized to approve or disapprove claims or to 
tell the Insured whether the claim will be approved by the Insurer.
    7. The Insurer may, at its option, waive the requirement for the 
completion and filing of a proof of loss in certain cases, in which 
event the Insured will be required to sign and, at the Insurer's option, 
swear to an adjuster's report of the loss which includes information 
about the loss and the damages needed by the Insurer in order to adjust 
the claim.
    8. Any false statements made in the course of presenting a claim 
under this policy may be punishable by fine or imprisonment under the 
applicable Federal laws.
    P. Options After a Loss: Options the Insurer may, in its sole 
discretion, exercise after loss include the following:
    1. Evidence of Loss: If the Insurer specifically requests it, in 
writing, the Insured may be required to furnish a complete inventory of 
the destroyed, damaged and undamaged property, including details as to 
quantities, costs, actual cash values or replacement cost (whichever is 
appropriate), amount of loss claims, and any written plans and 
specifications for repair of the damaged property which can reasonably 
be made available to the Insurer.

[[Page 298]]

    2. Examination Under Oath and Access to the Condominium 
Association's Articles of Association or Incorporation, Property 
Insurance Policies, and Other Condominium Documents: The Insurer may 
require the Insured to:
    a. Show the Insurer, or its designee, the damaged property;
    b. Be examined under oath by the Insurer or its designee;
    c. Sign any transcripts of such examinations; and
    d. At such reasonable times and places as the Insurer may designate, 
permit the Insurer to examine and make extracts and copies of any 
condominium documents, including the Articles of Association or 
Incorporation, Bylaws, rules and regulations, Declarations of the 
condominium, property insurance policies, and other condominium 
documents; and all books of accounts, bills, invoices and vouchers, or 
certified copies thereof if the originals are lost, pertaining to the 
damaged property.
    3. Options to Repair or Replace: The Insurer may take all or any 
part of the damaged property at the agreed or appraised value and, also, 
repair, rebuild or replace the property destroyed or damaged with other 
of like kind and quality within a reasonable time, on giving the Insured 
notice of the Insurer's intention to do so within 30 days after the 
receipt of the proof of loss herein required under paragraph O. above.
    4. Adjustment Options: The Insurer may adjust loss to any insured 
property of others with the owners of such property or with the Insured 
for their account. Any such insurance under this policy shall not inure 
directly or indirectly to the benefit of any carrier or other bailee for 
hire.
    Q. When Loss Payable: Loss is payable within 60 days after the 
Insured files its proof of loss (or within 90 days after the insurance 
adjuster files an adjuster's report signed and sworn to by the Insured 
in lieu of a proof of loss) and ascertainment of the loss is made either 
by agreement between the Insured and the Insurer in writing or by the 
filing with the Insurer of an award as provided in paragraph S. below.
    If the Insurer rejects the Insured's proof of loss in whole or in 
part, the Insured may accept such denial of its claim, or exercise its 
rights under this policy, or file an amended proof of loss as long as it 
is filed within 60 days of the date of the loss or any extension of time 
allowed by the Administrator.
    R. Abandonment: The Insured may not abandon damaged or undamaged 
insured property to the Insurer.
    However, the Insurer may permit the Insured to keep damaged, insured 
property (``salvage'') after a loss and reduce the amount of the loss 
proceeds payable to the Insured under the policy by the value of the 
salvage.
    S. Appraisal: If at any time after a loss, the Insurer is unable to 
agree with the Insured as to the actual cash value--or, if applicable, 
replacement cost--of the damaged property so as to determine the amount 
of loss to be paid to the Insured, then:
    1. On the written demand of either the Insurer or the Insured, each 
shall select a competent and disinterested appraiser and notify the 
other of the appraiser selected within 20 days of such demand.
    2. The appraisers shall first select a competent and disinterested 
umpire and failing, after 15 days, to agree upon such umpire, then on 
the Insurer's request or the Insured's request, such umpire shall be 
selected by a judge of a court of record in the State in which the 
insured property is located.
    3. The appraisers shall then appraise the loss, stating separately 
replacement cost, actual cash value and loss to each item; and, failing 
to agree, shall submit their differences, only, to the umpire.
    4. An award in writing, so itemized, of any two (appraisers or 
appraiser and umpire) when filed with the Insurer shall determine the 
amount of actual cash value and loss or, should this policy's 
replacement cost provisions apply, the amount of the replacement cost 
and loss.
    5. Each appraiser shall be paid by the party selecting him or her 
and the expenses of appraisal and umpire shall be paid by both parties 
equally.
    T. Action Against the Insurer: No suit or action on this policy for 
the recovery of any claim shall be sustainable in any court of law or 
equity unless all the requirements of this policy shall have been 
complied with, and unless commenced within 12 months next after the date 
of mailing of notice of disallowance or partial disallowance of the 
claim. An action on such claim against the Insurer must be instituted, 
without regard to the amount in controversy, in the United States 
District Court for the district in which the property shall have been 
situated.
    U. Subrogation: In the event of any payment under this policy, the 
Insurer shall be subrogated to all the Insured's rights of recovery 
therefor against any party, and the Insurer may require from the Insured 
an assignment of all rights of recovery against any party for loss to 
the extent that payment therefor is made by the Insurer. The Insured 
shall do nothing after loss to prejudice such rights; however, this 
insurance shall not be invalidated should the Insured waive in writing 
prior to a loss any or all rights of recovery against any party for loss 
occurring to the described property.
    V. Continuous Lake Flooding: Where the insured building has been 
inundated by rising lake waters continuously for 90 days or more and it 
appears reasonably certain that a continuation of this flooding will 
result in damage, reimbursable under this policy, to the

[[Page 299]]

insured building equal to or greater than the building policy limits 
plus the deductible(s) or the maximum payable under the policy for any 
one building loss, the Insurer will pay the Insured the lesser of these 
two amounts without waiting for the further damage to occur if the 
Insured signs a release agreeing to:
    1. Make no further claim under this policy; and
    2. Not seek renewal of this policy; and
    3. Not apply for any flood insurance under the Act for property at 
the property location of the insured building.
    If the policy term ends before the insured building has been flooded 
continuously for 90 days, the provisions of this paragraph V. still 
apply so long as the first building damage reimbursable under this 
policy from the continuous flooding occurred before the end of the 
policy term.
    W. Duplicate Policies Not Allowed: Property may not be insured under 
more than one policy issued under the Act. When the Insurer finds that 
duplicate policies are in effect, the Insurer shall by written notice 
give the Insured the option of choosing which policy is to remain in 
effect, under the following procedures:
    1. If the Insured chooses to keep in effect the policy with the 
earlier effective date, the Insurer shall by the same written notice 
give the Insured an opportunity to add the coverage limits of the later 
policy to those of the earlier policy, as of the effective date of the 
later policy.
    2. If the Insured chooses to keep in effect the policy with the 
later effective date, the Insurer shall by the same written notice give 
the Insured the opportunity to add the coverage limits of the earlier 
policy of those of the later policy, as of the effective date of the 
later policy.
    In either case, the Insured must pay the pro rata premium for the 
increased coverage limits within 30 days of the written notice. In no 
event shall the resulting coverage limits exceed the statutorily 
permissible limits of coverage under the Act or the Insured's insurable 
interest, whichever is less.
    The Insurer shall make a refund to the Insured, according to 
applicable National Flood Insurance Program rules, of the premium for 
the policy not being kept in effect.
    For purposes of this paragraph W., the term effective date means the 
date coverage that has been in effect without any lapse was first placed 
in effect. In addition to the provisions of this paragraph W. for 
increasing policy limits, the usual procedures for increasing limits by 
mid-term endorsement or at renewal time, with the appropriate waiting 
period, are applicable to the policy the Insured chooses to keep in 
effect.

                      Article 11--What Law Governs

    This policy is governed by the flood insurance regulations issued by 
FEMA, the National Flood Insurance Act of 1968, as amended (42 U.S.C. 
4001, et seq.) and Federal common law.
    In witness whereof, the Insurer has executed and attested these 
presents.

                                                        James L. Witt,  
                          Director, Federal Emergency Management Agency.

(The information required under the terms of this policy has been 
approved by the Office of Management and Budget under OMB control number 
3067-0021.)


[58 FR 62439, Nov. 26, 1993, as amended at 62 FR 8399, Feb. 25, 1997]



PART 62--SALE OF INSURANCE AND ADJUSTMENT OF CLAIMS--Table of Contents




                     Subpart A--Issuance of Policies

Sec.
62.1  Purpose of part.
62.2  Definitions.
62.3  Servicing agent.
62.4  Limitations on sale of policies.
62.5  Premium refund.
62.6  Minimum commissions.

            Subpart B--Claims Adjustment and Judicial Review

62.21  Claims adjustment.
62.22  Judicial review.

                Subpart C--Write-Your-Own (WYO) Companies

62.23  WYO Companies authorized.
62.24  WYO Company participation criteria: new applicants.

Appendix A to Part 62--Federal Emergency Management Agency, Federal 
          Insurance Administration, Financial Assistance/Subsidy 
          Arrangement
Appendix B to Part 62--National Flood Insurance Program

    Authority: 42 U.S.C. 4001 et seq,; Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127 of Mar. 31, 
1979, 44 FR 19367, 3 CFR, 1979 Comp., p. 376.

    Source: 43 FR 2573, Jan. 17, 1978, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.

[[Page 300]]



                     Subpart A--Issuance of Policies



Sec. 62.1  Purpose of part.

    The purpose of this part is to set forth the manner in which flood 
insurance under the Program is made available to the general public in 
those communities designated as eligible for the sale of insurance under 
part 64 of this subchapter, and to prescribe the general method by which 
the Administrator exercises his/her responsibility regarding the manner 
in which claims for losses are paid.



Sec. 62.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.



Sec. 62.3  Servicing agent.

    (a) Pursuant to sections 1345 and 1346 of the Act, the Administrator 
has entered into the Agreement with a servicing agent to authorize it to 
assist in issuing flood insurance policies under the Program in 
communities designated by the Administrator and to accept responsibility 
for delivery of policies and payment of claims for losses as prescribed 
by and at the discretion of the Administrator.
    (b) National Con-Serv, Inc., whose offices are located in Rockville, 
Maryland, is the servicing agent for the Federal Insurance 
Administration.
    (c) The servicing agent will arrange for the issuance of flood 
insurance to any person qualifying for such coverage under parts 61 and 
64 of this subchapter who submits an application to the servicing agent 
in accordance with the terms and conditions of the contract between the 
Agency and the servicing agent.

[43 FR 2573, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 58 
FR 62447, Nov. 26, 1993]



Sec. 62.4  Limitations on sale of policies.

    (a) The servicing agent shall be deemed to have agreed, as a 
condition of its contract that it shall not offer flood insurance under 
any authority or auspices in any amount within the maximum limits of 
coverage specified in Sec. 61.6 of this subchapter, in any area the 
Administrator designates in part 64 of this subchapter as eligible for 
the sale of flood insurance under the Program, other than in accordance 
with this part, and the Standard Flood Insurance Policy.
    (b) The agreement and all activities thereunder are subject to title 
VI of the Civil Rights Act of 1964, 42 U.S.C. 2000d, and to the 
applicable Federal regulations and requirements issued from time to time 
pursuant thereto. No person shall be excluded from participation in, 
denied the benefits of, or subjected to discrimination under the 
Program, on the ground of race, color, sex, creed or national origin. 
Any complaint or information concerning the existence of any such 
unlawful discrimination in any matter within the purview of this part 
should be referred to the Administrator.

[43 FR 2573, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 62.5  Premium refund.

    A Standard Flood Insurance Policyholder whose property has been 
determined not to be in a special hazard area after the map revision or 
a Letter of Map Amendment under part 70 of this subchapter may cancel 
the policy within the current policy year provided (a) he was required 
to purchase or to maintain flood insurance coverage, or both, as a 
condition for financial assistance, and (b) his property was located in 
an identified special hazard area as represented on an effective FHBM or 
FIRM when the financial assistance was provided. If no claim under the 
policy has been paid or is pending, the full premium shall be refunded 
for the current policy year, and for an additional policy year where the 
insured had been required to renew the policy during the period when a 
revised map was being reprinted. A Standard Flood Insurance Policyholder 
may cancel a policy having a term of three (3) years, on an anniversary 
date, where the reason for the cancellation is that a policy of flood 
insurance has been obtained or is being obtained in substitution for the 
NFIP policy and the NFIP obtains a written concurrence in the 
cancellation from any mortgage of which the NFIP has actual notice; or

[[Page 301]]

the policyholder has extinguishing the insured mortgage debt and is no 
longer required by the mortgagee to maintain the coverage. In such 
event, the premium refund shall be pro rata but with retention of the 
expense constant.

[43 FR 2573, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 49 FR 33658, Aug. 24, 1984; 53 FR 16279, May 6, 1988]



Sec. 62.6  Minimum commissions.

    (a) The earned commission which shall be paid to any property or 
casualty insurance agent or broker duly licensed by a state insurance 
regulatory authority, with respect to each policy or renewal the agent 
duly procures on behalf of the insured, in connection with policies of 
flood insurance placed with the NFIP at the offices of its servicing 
agent, but not with respect to policies of flood insurance issued 
pursuant to Subpart C of this part, shall not be less than $10 and is 
computed as follows:
    (1) In the case of a new or renewal policy, the following 
commissions shall apply based on the total premiums paid for the policy 
term:

                                                                        
------------------------------------------------------------------------
                                                             Commissions
                       Premium amount                         (percent) 
------------------------------------------------------------------------
First $2,000 of Premium....................................           15
Excess of $2,000...........................................            5
------------------------------------------------------------------------

    (2) In the case of mid-term increases in amounts of insurance added 
by endorsements, the following commissions shall apply based on the 
total premiums paid for the increased amounts of insurance:

                                                                        
------------------------------------------------------------------------
                                                             Commissions
                       Premium amount                         (percent) 
------------------------------------------------------------------------
First $2,000 of Premium....................................           15
Excess of $2,000...........................................            5
------------------------------------------------------------------------

    (b) Any refunds of premiums authorized under this subchapter shall 
not affect a previously earned commission; and no agent shall be 
required to return that earned commission, unless the refund is made to 
establish a common policy term anniversary date with other insurance 
providing coverage against loss by other perils in which case a return 
of commission will be required by the agent on a pro rata basis. In such 
cases, the policy shall be immediately rewritten for a new term with the 
same amount(s) of coverage and with premium calculated at the then 
current rate and, as to return premium, returned, pro rata, to the 
insured based on the former policy's premium rate.

[46 FR 13515, Feb. 23, 1981, as amended at 53 FR 15221, Apr. 28, 1988; 
57 FR 19541, May 7, 1992]



            Subpart B--Claims Adjustment and Judicial Review



Sec. 62.21  Claims adjustment.

    (a) In accordance with the Agreement, the servicing agent shall 
arrange for the prompt adjustment and settlement and payment of all 
claims arising from policies of insurance issued under the program. 
Investigation of such claims may be made through the facilities of its 
subcontractors or insurance adjustment organizations, to the extent 
required and appropriate for the expeditious processing of such claims.
    (b) All adjustment of losses and settlements of claims shall be made 
in accordance with the terms and conditions of the policy and parts 61 
and 62 of this subchapter.



Sec. 62.22  Judicial review.

    (a) Upon the disallowance by the Federal Insurance Administration or 
the servicing agent of any claim on grounds other than failure to file a 
proof of loss, or upon the refusal of the claimant to accept the amount 
allowed upon any such claim, after appraisal pursuant to policy 
provisions, the claimant within one year after the date of mailing by 
the Federal Insurance Administration or the servicing agent of the 
notice of disallowance or partial disallowance of the claim may, 
pursuant to 42 U.S.C. 4072, institute an action on such claim against 
the Federal Insurance Administrator in the U.S. District Court for the 
district in which the insured property or the major portion thereof 
shall have been situated, without regard to the amount in controversy.
    (b) Service of process for all judicial proceedings where a claimant 
is suing Director pursuant to 42 U.S.C. 4071 shall be made upon the 
appropriate

[[Page 302]]

United States Attorney, the Attorney General of the United States, and 
the Federal Insurance Administrator of the Federal Emergency Management 
Agency.

[43 FR 2573, Jan. 17, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 43061 Sept. 30, 1982; 49 FR 33879, Aug. 27, 1984]



                Subpart C--Write-Your-Own (WYO) Companies



Sec. 62.23  WYO Companies authorized.

    (a) Pursuant to section 1345 of the Act, the Administrator may enter 
into arrangements with individual private sector property insurance 
companies whereby such companies may offer flood insurance coverage 
under the Program to eligible applicants for such insurance, including 
policyholders insured by them under their own property business lines of 
insurance pursuant to their customary business practices including their 
usual arrangements with agents and producers, in any State in which such 
WYO Companies are licensed to engage in the business of property 
insurance. Arrangements entered into by WYO Companies under this subpart 
shall be in the form and substance of the standard arrangement, entitled 
``Financial Assistance/Subsidy Arrangement'', a copy of which is 
included in appendix A of this part and made a part of these 
regulations.
    (b) Any duly licensed insurer so engaged in the Program shall be a 
WYO Company.
    (c) A WYO Company is authorized to arrange for the issuance of flood 
insurance in any amount within the maximum limits of coverage specified 
in Sec. 61.6 of this subchapter, as Insurer, to any person qualifying 
for such coverage under parts 61 and 64 of this subchapter who submits 
an application to the WYO Company; coverage shall be issued under the 
Standard Flood Insurance Policy.
    (d) A WYO Company issuing flood insurance coverage shall arrange for 
the adjustment, settlement, payment and defense of all claims arising 
from policies of flood insurance it issues under the Program, based upon 
the terms and conditions of the Standard Flood Insurance Policy.
    (e) In carrying out its functions under this subpart, a WYO Company 
shall use its own customary standards, staff and independent contractor 
resources, as it would in the ordinary and necessary conduct of its own 
business affairs, subject to the Act and regulations prescribed by the 
Administrator under the Act.
    (f) To facilitate the marketing of flood insurance coverage under 
the Program to policyholders of WYO Companies, the Administrator will 
enter into arrangements with such companies whereby the Federal 
Government will be a guarantor in which the primary relationship between 
the WYO Company and the Federal Government will be one of a fiduciary 
nature, i.e., to assure that any taxpayer funds are accounted for and 
appropriately expended. In furtherance of this end, the Administrator 
has established ``A Plan to Maintain Financial Control for Business 
Written Under the Write Your Own Program'', a copy of which is included 
in appendix B of this part and made a part of these regulations.
    (g) WYO Companies shall not be agents of the Federal Government and 
are solely responsible for their obligations to their insureds under any 
flood insurance policies issued under agreements entered into with the 
Administrator.
    (h) To facilitate the underwriting of flood insurance coverage by 
WYO Companies, the following procedures will be used by WYO Companies:
    (1) To expedite business growth, the WYO Company will encourage its 
present property insurance policyholders to purchase flood insurance 
through the NFIP WYO Program.
    (2) To conform its underwriting practices to the underwriting rules 
and rates in effect as to the NFIP, the WYO Company will establish 
procedures to carry out the NFIP rating system and provide its 
policyholders with the same coverage as is afforded under the NFIP.
    (3) The WYO Company may follow its customary billing practices to 
meet the Federal rules on the presentment of premium and net premium 
deposits to a Letter of Credit bank account authorized by the 
Administrator and reduction of coverage when an underpayment is 
discovered.

[[Page 303]]

    (4) The WYO Company is expected to meet the recording and reporting 
requirements of the WYO Transaction Record Reporting and Processing 
Plan. Transactions reported by the WYO Company under the WYO Transaction 
Record Reporting and Processing Plan will be analyzed by the NFIP Bureau 
& Statistical Agent. A monthly report will be submitted to the WYO 
Company and the FIA. The analysis will cover the timeliness of WYO 
Company submissions, the disposition of transactions that have not 
passed systems edits and the reconciliation of the totals generated from 
transaction reports with those submitted on the WYO Company's 
reconciliation reports.
    (5) If a WYO Company rejects an application from an agent or a 
producer, the agent or producer shall be notified so that the business 
can be placed through the NFIP Servicing Agent, or another WYO Company.
    (6) Flood insurance coverage will be issued by the WYO Company on a 
separate policy form and will not be added, by endorsement, to the 
Company's other property insurance forms.
    (7) Premium payment plans can be offered by the WYO Company so long 
as the net premium depository requirements specified under the NFIP/WYO 
Program accounting procedures are met. A cancellation by the WYO Company 
for non-payment of premium will not produce a pro rata return of the net 
premium deposit to the WYO Company.
    (8) NFIP business will not be assumed by the WYO Companies at any 
time other than at renewal time, at which time the insurance producer 
may submit the business to the WYO Company as new business. However, it 
is permissible to cancel and rewrite flood policies to obtain concurrent 
expiration dates with other policies covering the property.
    (i) To facilitate the adjustment of flood insurance claims by WYO 
Companies, the following procedures will be used by WYO Companies.
    (1) Under the terms of the Arrangement set forth at appendix A of 
this part, WYO Companies will adjust claims in accordance with general 
Company standards, guided by NFIP Claims manuals. The Arrangement also 
provides that claim adjustments shall be binding upon the FIA. For 
example, the entire responsibility for providing a proper adjustment for 
both combined wind and water claims and flood-alone claims is the 
responsibility of the WYO Company. The responsibility for providing a 
proper adjustment for combined wind and water claims is to be conducted 
by listing in concert with the Single Adjuster provisions listed in 
appendix A.
    (2) The WYO Company may use its staff adjusters, independent 
adjusters, or both. It is important that the Company's Claims Department 
verifies the correctness of the coverage interpretations and 
reasonableness of the payments recommended by the adjusters.
    (3) An established loss adjustment Fee Schedule is part of the 
Arrangement and cannot be changed during an Arrangement year. This is 
the expense allowance to cover costs of independent or WYO Company 
adjusters.
    (4) The normal catastrophe claims procedure currently operated by a 
WYO Company should be implemented in the event of a claim catastrophe 
situation. Flood claims will be handled along with other catastrophe 
claims.
    (5) It will be the WYO Company's responsibility to try to detect 
fraud (as it does in the case of property insurance) and coordinate its 
findings with FIA.
    (6) Pursuant to the Arrangement, the responsibility for defending 
claims will be upon the Write Your Own Company and defense costs will be 
part of the unallocated or allocated claim expense allowance, depending 
on whether a staff counsel or an outside attorney handles the defense of 
the matter. Claims in litigation will be reported by WYO Companies to 
FIA upon joinder of issue and FIA may inquire and be advised of the 
disposition of such litigation.
    (7) The claim reserving procedures of the individual WYO Company can 
be used.
    (8) Regarding the handling of subrogation, if a WYO Company prefers 
to forego pursuit of subrogation recovery, it may do so by referring the 
matter, with a complete copy of the claim file, to FIA. Subrogation 
initiatives may be truncated at any time before suit is commenced (after 
commencing an action, special arrangement must be

[[Page 304]]

made). FIA, after consultation with FEMA's Office of the General Counsel 
(OGC), will forward the cause of action to OGC or to the NFIP Bureau and 
Statistical Agent for prosecution. Any funds received will be deposited, 
less expenses, in the National Flood Insurance Fund.
    (9) Special allocated loss adjustment expenses will include such 
items as: nonstaff attorney fees, engineering fees and special 
investigation fees over and above normal adjustment practices.
    (10) The customary content of claim files will include coverage 
verification, normal adjuster investigations, including statements where 
necessary, police reports, building reports and investigations, damage 
verification and other documentation relevant to the adjustment of 
claims under the NFIP's and the WYO Company's traditional claim 
adjustment practices and procedures. The WYO Company's claim examiners 
and managers will supervise the adjustment of flood insurance claims by 
staff and independent claims adjusters.
    (11) The WYO Company will extend reasonable cooperation to FEMA's 
Office of the General Counsel on matters pertaining to litigation and 
subrogation, under paragraph (i)(8) of this section.
    (j) To facilitate establishment of financial controls under the WYO 
Program, the WYO Company will:
    (1) Select a Certified Public Accountant (CPA) firm to conduct 
biennial audits of the financial, claims and underwriting records of the 
company. These audits shall be performed in accordance with the 
Government Auditing Standards issued by the Comptroller General of the 
United States (commonly known as the ``yellow book''). FIA further 
requires that pre-selected policy and claims files the CPA firm is asked 
to review are in addition to any files that the auditors may select for 
their sample. A report of the detailed biennial audit conducted will be 
filed with the FIA which, after a review of the audit report, will 
convey its determination to the Standards Committee. The CPA firm chosen 
to conduct the audit is expected to use qualified, skilled persons with 
the requisite background in property insurance and a knowledge of the 
NFIP. Persons performing claims audits are expected to possess claims 
expertise which would allow them to ascertain whether the scope of 
damage was proper, and if all applicable NFIP policy provisions were 
properly followed. Persons performing underwriting audits should be able 
to ascertain if the risk has been properly rated, which would 
necessitate being aware of special NFIP rating situations, such as 
elevated buildings.
    (2) Meet the recording and reporting requirements of the WYO 
Transaction Record Reporting and Processing Plan and the WYO Accounting 
Procedures Manual. Transactions reported to the National Flood Insurance 
Program's (NFIP's) Bureau and Statistical Agent by the WYO Company under 
the WYO Transaction Record Reporting and Processing Plan and the WYO 
Accounting Procedures Manual will be analyzed by the Bureau and 
Statistical Agent and a monthly report will be submitted to the WYO 
Company and the FIA. The analysis will cover the timeliness of the WYO 
Company submissions, the disposition of transactions which do not pass 
systems edits and the reconciliation of the totals generated from 
transaction reports with those submitted on WYO Company reconciliation 
reports.
    (3) Cooperate with FEMA's Office of Financial Management on Letter 
of Credit matters.
    (4) Cooperate with FIA in the implementation of a claims 
reinspection program.
    (5) Cooperate with FIA in the verification of risk rating 
information.
    (6) Cooperate with FEMA's Office of the Inspector General on matters 
pertaining to fraud.
    (k) To facilitate the operation of the WYO Program and in order that 
a WYO Company can use its own customary standards, staff and independent 
contractor resources, as it would in the ordinary and necessary conduct 
of its own business affairs, subject to the Act, the Administrator, for 
good cause shown, may grant exceptions to and waivers of the regulations 
contained in this title relative to the administration of the NFIP.
    (l)(1) WYO Companies may, on a voluntary basis, elect to participate 
in the

[[Page 305]]

Mortgage Portfolio Protection Program (MPPP), under which they can 
offer, as a last resort, flood insurance at special high rates, 
sufficient to recover the full cost of this program in recognition of 
the uncertainty as to the degree of risk a given building presents due 
to the limited underwriting data required, to properties in a lending 
institution's mortgage portfolio to achieve compliance with the flood 
insurance purchase requirements of the Flood Disaster Protection Act of 
1973. Flood insurance policies under the MPPP may only be issued for 
those properties that:
    (i) Are determined to be located within special flood hazard areas 
of communities that are participating in the NFIP, and
    (ii) Are not covered by a flood insurance policy even after a 
required series of notices have been given to the property owner 
(mortgagor) by the lending institution of the requirement for obtaining 
and maintaining such coverage, but the mortgagor has failed to respond.
    (2) WYO Companies participating in the MPPP must provide a detailed 
implementation package to any lending institution that, on a voluntary 
basis, chooses to participate in the MPPP to ensure the lending 
institution has full knowledge of the criteria in that program and must 
obtain a signed receipt for that package from the lending institution. 
Participating WYO Companies must also maintain evidence of compliance 
with paragraph (l)(3) of this section for review during the audits and 
reviews required by the WYO Financial Control Plan contained in appendix 
B of this part.
    (3) The mortgagor must be protected against the lending 
institution's arbitrary placing of flood insurance for which the 
mortgagor will be billed by being sent three notification letters as 
described in paragraphs (l)(4) through (6) of this section.
    (4) The initial notification letter must:
    (i) State the requirements of the Flood Disaster Protection Act of 
1973, as amended;
    (ii) Announce the determination that the mortgagor's property is in 
an identified special flood hazard area as delineated on the appropriate 
FEMA map, necessitating flood insurance coverage for the duration of the 
loan;
    (iii) Describe the procedure to follow should the mortgagor wish to 
challenge the determination;
    (iv) Request evidence of a valid flood insurance policy or, if there 
is none, encourage the mortgagor to obtain a Standard Flood Insurance 
Policy (SFIP) promptly from a local insurance agent (or WYO Company);
    (v) Advise that the premium for a MPPP policy is significantly 
higher than a conventional SFIP policy and advise as to the option for 
obtaining less costly flood insurance; and
    (vi) Advise that a MPPP policy will be purchased by the lender if 
evidence of flood insurance coverage is not received by a date certain.
    (5) The second notification letter must remind the mortgagor of the 
previous notice and provide essentially the same information.
    (6) The final notification letter must:
    (i) Enclose a copy of the flood insurance policy purchased under the 
MPPP on the mortgagor's (insured's) behalf, together with the 
Declarations Page,
    (ii) Advise that the policy was purchased because of the failure to 
respond to the previous notices, and
    (iii) Remind the insured that similar coverage may be available at 
significantly lower cost and advise that the policy can be cancelled at 
any time during the policy year and a pro rata refund provided for the 
unearned portion of the premium in the event the insured purchases 
another policy that is acceptable to satisfy the requirements of the 
1973 Act. ``(Approved by the Office of Management and Budget under OMB 
control number 3067-0229.)''

[61 FR 51219, Oct. 1, 1996]



Sec. 62.24  WYO Company participation criteria: new applicants.

    New companies seeking to participate in the WYO Program, as well as 
former WYO Companies seeking to return to the WYO Program, must meet 
standards for financial capability and stability, for statistical and 
financial reporting, and for commitment to Program objectives.
    (a) To demonstrate the ability to meet the financial requirements, 
an

[[Page 306]]

applicant for entry or reentry into the WYO Program must:
    (1) be a licensed property insurance company;
    (2) have a five (5) year history of writing property insurance;
    (3) disclose any legal proceedings, suspensions, judgments, 
settlements, or agreements reached with any State insurance department, 
State attorney general, State corporation commission, or the Federal 
government during the immediate prior five (5) years regarding the 
company's business practices;
    (4) submit its most recent National Association of Insurance 
Commissioners (NAIC) annual statement;
    (5) submit, as data become available, information to indicate that 
the company meets or exceeds NAIC standards for risk-based capital and 
surplus; and
    (6) submit its last State or regional audit, which should contain no 
material negative findings.
    (b) An applicant for entry or reentry into the WYO Program must also 
pass a test to determine the company's ability to process flood 
insurance and meet the Transaction Record Reporting and Processing 
(TRRP) Plan requirements of the WYO Financial Control Plan. Unless the 
test requirement is waived, e.g., where the company's reporting 
requirements will be fulfilled by an already qualified performer, the 
applicant must prepare and submit test output monthly tape(s) and 
monthly financial statements and reconciliations for processing by the 
NFIP Bureau and Statistical Agent contractor. For test purposes, no 
error tolerance will be allowed. If the applicant fails the initial 
test, a second test will be run, which the applicant must pass to 
participate in the Program.
    (c) To satisfy the requirement for commitment to Program goals, 
including marketing of flood insurance policies, the company shall 
submit information concerning the company's plans for the Write Your Own 
Program including plans for the training and support of producers and 
staff, marketing plans and sales targets, and claims handling and 
disaster response plans. Applicants must also identify those aspects of 
their planned flood insurance operations to be performed by another 
organization, managing agent, another WYO Company, a WYO vendor, a 
service bureau or related organization. Applicant companies shall also 
name, in addition to a Principal Coordinator, a corporate officer point 
of contact-- an individual, e.g., at the level of a Senior Executive 
Vice President, who reports directly to the Chief Executive Officer or 
the Chief Operating Officer. Each applicant shall furnish the latest 
available information regarding the number of its fire, allied lines, 
farmowners multiple peril, homeowners multiple peril, and commercial 
multiple peril policies in force, by line, and the company's Best's 
Financial Size Category for the purpose of setting marketing goals.

[59 FR 38572, July 29, 1994]

  Appendix A to Part 62--Federal Emergency Management Agency, Federal 
   Insurance Administration, Financial Assistance/Subsidy Arrangement

    Purpose: To assist the company in underwriting flood insurance using 
the Standard Flood Insurance Policy.
    Accounting Data: Pursuant to Section 1310 of the Act, a Letter of 
Credit shall be issued for payment as provided for herein from the 
National Flood Insurance Fund.
    Effective Date: October 1, 1997.
    Issued By: Federal Emergency Management Agency, Federal Insurance 
Administration, Washington, DC 20472.

               Article I--Findings, Purpose, and Authority

    Whereas, the Congress in its ``Finding and Declaration of Purpose'' 
in the National Flood Insurance Act of 1968, as amended, (``the Act'') 
recognized the benefit of having the National Flood Insurance Program 
(the ``Program'' or ``NFIP'') ``carried out to the maximum extent 
practicable by the private insurance industry''; and
    Whereas, the Federal Insurance Administration (FIA) recognizes this 
Arrangement as coming under the provisions of Section 1345 of the Act; 
and
    Whereas, the goal of the FIA is to develop a program with the 
insurance industry where, overtime, some risk-bearing role for the 
industry will evolve as intended by the Congress (Section 1304 of the 
Act); and
    Whereas, the insurer (hereinafter the ``Company'') under this 
Arrangement shall charge rates established by the FIA; and
    Whereas, this Arrangement will subsidize all flood policy losses by 
the Company; and

[[Page 307]]

    Whereas, this Financial Assistance/Subsidy Arrangement has been 
developed to enable any interested qualified insurer to write flood 
insurance under its own name; and
    Whereas, one of the primary objectives of the Program is to provide 
coverage to the maximum number of structures at risk and because the 
insurance industry has marketing access through its existing facilities 
not directly available to the FIA, it has been concluded that coverage 
will be extended to those who would not otherwise be insured under the 
Program; and
    Whereas, flood insurance policies issued subject to this Arrangement 
shall be only that insurance written by the Company in its own name 
under prescribed policy conditions and pursuant to this Arrangement and 
the Act; and
    Whereas, over time, the Program is designed to increase industry 
participation, and, accordingly, reduce or eliminate Government as the 
principal vehicle for delivering flood insurance to the public; and
    Whereas, the direct beneficiaries of this Arrangement will be those 
Company policyholders and applicants for flood insurance who otherwise 
would not be covered against the peril of flood.
    Now, therefore, the parties hereto mutually undertake the following:

                 Article II--Undertaking of the Company

    A. Eligibility Requirements for Participation in the NFIP:
    1. Policy Administration. All fund receipt, recording, control, 
timely deposit requirements, and disbursement in connection with all 
Policy Administration and any other related activities or 
correspondences, must meet all requirements of the Financial Control 
Plan. The Company shall be responsible for:
    a. Compliance with the Community Eligibility/Rating Criteria
    b. Making Policyholder Eligibility Determinations
    c. Policy Issuance
    d. Policy Endorsements
    e. Policy Cancellations
    f. Policy Correspondence
    g. Payment of Agents' Commissions

    2. Claims Processing. All claims processing must be processed in 
accordance with the processing of all the companies' insurance policies 
and with the Financial Control Plan. Companies will also be required to 
comply with FIA Policy Issuances and other guidance authorized by FIA or 
the Federal Emergency Management Agency (``FEMA'').
    3. Reports.
    a. Monthly Financial Reporting and Statistical Transaction reporting 
requirements. All monthly financial reporting and statistical 
transaction reporting shall be in accordance with the requirements of 
the NFIP Transaction Record Reporting and Processing Plan for the 
Company Program and the Financial Control Plan for business written 
under the WYO (Write Your Own) Program. 44 CFR part 62, appendix B. 
These data shall be validated/edited/audited in detail and shall be 
compared and balanced against Company reports.
    b. Monthly financial reporting procedure shall be in accordance with 
the WYO Accounting Procedures.
    B. Time Standards. Time will be measured from the date of receipt 
through the date mailed out. All dates referenced are working days, not 
calendar days. In addition to the standards set forth below, all 
functions performed by the company shall be in accordance with the 
highest reasonably attainable quality standards generally utilized in 
the insurance and data processing field. Continual failure to meet these 
requirements may result in limitations on the company's authority to 
write new business or the removal of the Company from the program. 
Applicable time standards are:
    1. Application Processing--15 days (note: if the policy cannot be 
mailed due to insufficient or erroneous information or insufficient 
funds, a request for correction or added moneys shall be mailed within 
10 days);
    2. Renewal Processing--7 days.
    3. Endorsement Processing--15 days.
    4. Cancellation Processing--15 days.
    5. Claims Draft Processing--7 days from completion of file 
examination.
    6. Claims Adjustment--45 days average from the receipt of Notice of 
Loss (or equivalent) through completion of examination.
    C. Single Adjuster Program. To ensure the maximum responsiveness to 
the NFIP policy holders following a catastrophic event, e.g., a 
hurricane, involving insured wind and flood damage to policyholders, the 
Company shall agree to the adjustment of the combined flood and wind 
losses utilizing one adjuster under an NFIP-approved Single Adjuster 
Program using procedures issued by the Administrator. The Single 
Adjuster procedure shall be followed in the following cases:
    1. Where the flood and wind coverage is provided by the Company;
    2. Where the flood coverage is provided by the Company and the wind 
coverage is provided by a participating State Property Insurance Plan, 
Windpool Association, Beach Plan, Joint Underwriting Association, FAIR 
Plan, or similar property insurance mechanism; and
    3. Where the flood coverage is provided by the Company and the wind 
coverage is provided by another property insurer and the State Insurance 
Regulator has determined that such property insurer shall, in the 
interest of consumers, facilitate the adjustment of its wind loss by the 
adjuster engaged to adjust the flood loss of the Company.
    D. Policy Issuance.

[[Page 308]]

    1. The flood insurance subject to this Arrangement shall be only 
that insurance written by the Company in its own name pursuant to the 
Act.
    2. The Company shall issue policies under the regulations prescribed 
by the Administrator in accordance with the Act.
    3. All such policies of insurance shall conform to the regulations 
prescribed by the Administrator pursuant to the Act, and be issued on a 
form approved by the Administrator.
    4. All policies shall be issued in consideration of such premiums 
and upon such terms and conditions and in such States or areas or 
subdivisions thereof as may be designated by the Administrator and only 
where the Company is licensed by State law to engage in the property 
insurance business.
    5. The Administrator may require the Company to discontinue issuing 
policies subject to this Arrangement immediately in the event 
Congressional authorization or appropriation for the National Flood 
Insurance Program is withdrawn.
    E. The Company shall separate Federal flood insurance funds from all 
other Company accounts, at a bank or banks of its choosing for the 
collection, retention and disbursement of Federal funds relating to its 
obligation under this Arrangement, less the Company's expenses as set 
forth in Article III, and the operation of the Letter of Credit 
established pursuant to Article IV. All funds not required to meet 
current expenditures shall be remitted to the United States Treasury, in 
accordance with the provisions of the WYO Accounting Procedures Manual.
    F. The Company shall investigate, adjust, settle and defend all 
claims or losses arising from policies issued under this Arrangement. 
Payment of flood insurance claims by the Company shall be binding upon 
the FIA.
    G. The Company shall market flood insurance policies in a manner 
consistent with the marketing guidelines established by the Federal 
Insurance Administration.

 Article III--Loss Costs, Expenses, Expense Reimbursement, and Premium 
                                 Refunds

    A. The Company shall be liable for operating, administrative and 
production expenses, including any State premium taxes, dividends, 
agents' commissions or any other expense of whatever nature incurred by 
the Company in the performance of its obligations under this Arrangement 
but excluding other taxes or fees, such as surcharges on flood insurance 
premium and guaranty fund assessments.
    B. The Company shall be entitled to withhold, as operating and 
administrative expenses, including agents' or brokers' commissions, an 
amount from the Company's written premium on the policies covered by 
this Arrangement in reimbursement of all of the Company's marketing, 
operating and administrative expenses, except for allocated and 
unallocated loss adjustment expenses described in Section C. of this 
Article, which amount shall be a minimum of 31.6% of the Company's 
written premium on the policies covered by this Arrangement.
    The amount of expense allowance retained by the company may be 
increased to a maximum of 32.9%, depending on the extent to which the 
company meets the marketing goals for the 1997-1998 Arrangement year 
contained in marketing guidelines established pursuant to Article II.G. 
The amount of any increase shall be paid to the company after the end of 
the 1997-1998 Arrangement year.
    The Company, with the consent of the Administrator as to terms and 
costs, shall be entitled to utilize the services of a national rating 
organization, licensed under state law, to assist the FIA in undertaking 
and carrying out such studies and investigations on a community or 
individual risk basis, and in determining more equitable and accurate 
estimates of flood insurance risk premium rates as authorized under the 
National Flood Insurance Act of 1968, as amended. The Company shall be 
reimbursed in accordance with the provisions of the WYO Accounting 
Procedures Manual for the charges or fees for such services.
    C. Loss Adjustment Expenses shall be reimbursed as follows:
    1. Unallocated loss adjustment shall be an expense reimbursement of 
3.3% of the incurred loss (except that it does not include ``incurred 
but not reported'').
    2. Allocated loss adjustment expense shall be reimbursed to the 
Company pursuant to a ``Fee Schedule'' coordinated with the Company and 
provided by the Administrator.
    3. Special allocated loss expenses shall be reimbursed to the 
Company in accordance with guidelines issued by the Administrator.
    D. Loss Payments.
    1. Loss payments under policies of flood insurance shall be made by 
the Company from funds retained in the bank account(s) established under 
Article II, Section E and, if such funds are depleted, from funds 
derived by drawing against the Letter of Credit established pursuant to 
Article IV.
    2. Loss payments include payments as a result of litigation which 
arises under the scope of this Arrangement, and the Authorities set 
forth above. All such loss payments must meet the documentation 
requirements of the Financial Control Plan and of this Arrangement. The 
Company will be reimbursed for errors and omissions only as set forth at 
Article IX of this Arrangement.
    3. Notification of claims in litigation against the company. To 
ensure reimbursement of costs expended to defend a claim in litigation 
against the Company, the Company must promptly notify FIA.

[[Page 309]]

    Prompt notice, in duplicate, of any such claim in litigation within 
the scope of this section (D) shall be sent to the FIA along with a copy 
of any material pertinent to the claim in litigation. FIA shall forward 
one copy of all such claims to the Associate General Counsel for 
Litigation, FEMA OGC, to ensure that the FEMA OGC is aware of all 
pending litigation. Following the initial notice of claims in 
litigation, to ensure expeditious reimbursement, the company must submit 
all pertinent material and billing documentation as it becomes 
available. Within 60 days of the receipt of a notice of claim in 
litigation by the Company, the Company must submit an initial case 
analysis and legal fee estimate for billing support. Failure to meet 
these notice requirements may result in the Administrator's decision not 
to reimburse expenses for which FIA and the FEMA OGC have not been 
notified in a timely manner.
    4. Limitation on Litigation Costs. Following receipt of notice of 
such claim, the Office of General Counsel (OGC), FEMA, shall review the 
information submitted. If it is determined that the claim is grounded in 
actions by the Company that are outside the scope of this Arrangement, 
the National Flood Insurance Act, and 44 CFR chapter 1, subchapter B, 
and/or involve issues of insurer/agent negligence as discussed in 
Article IX of this Arrangement, the OGC shall make a recommendation to 
the Administrator as to whether the claim is grounded in actions by the 
Company that are significantly outside the scope of this Arrangement. In 
the event the Administrator determines that the claim is grounded in 
actions by the Company that are significantly outside the scope of this 
Arrangement, the Company will be notified, in writing, within thirty 
(30) days of the Administrator's decision, if the decision is that any 
award or judgment for damages arising out of such actions will not be 
recognized under Article III of this Arrangement as a reimbursable loss 
cost, expense or expense reimbursement. In the event that the Company 
wishes to petition for reconsideration the determination that it will 
not be reimbursed for the award or judgment made under the above 
circumstances, it may do so by mailing, within thirty days of the notice 
declining to recognize any such award or judgment as reimbursable under 
Article III, a written petition to the Chairman of the WYO Standards 
Committee established under the Financial Control Plan. The WYO 
Standards Committee will, then, consider the petition at its next 
regularly scheduled meeting or at a special meeting called for that 
purpose by the Chairman and issue a written recommendation to the 
Administrator within thirty days of the meeting. The Administrator's 
final determination will be made, in writing, to the Company within 
thirty days of the recommendation made by the WYO Standards Committee.
    E. Premium refunds to applicants and policyholders required pursuant 
to rules contained in the National Flood Insurance Program (NFIP) 
``Flood Insurance Manual'' shall be made by the Company from Federal 
flood insurance funds referred to in Article II, Section E, and, if such 
funds are depleted, from funds derived by drawing against the Letter of 
Credit established pursuant to Article IV.

               Article IV--Undertakings of the Government

    A. Letter(s) of Credit shall be established by the Federal Emergency 
Management Agency (FEMA) against which the Company may withdraw funds 
daily, if needed, pursuant to prescribed procedures implemented by FEMA. 
The amounts of the authorizations will be increased as necessary to meet 
the obligations of the Company under Article III, Sections C, D, and E. 
Request for funds shall be made only when net premium income has been 
depleted. The timing and amount of cash advances shall be as close as is 
administratively feasible to the actual disbursements by the recipient 
organization for allowable Letter of Credit expenses.
    Request for payment on Letters of Credit shall not ordinarily be 
drawn more frequently than daily nor in amounts less than $5,000, and in 
no case more than $5,000,000 unless so stated on the Letter of Credit. 
This Letter of Credit may be drawn by the Company for any of the 
following reasons:
    1. Payment of claim as described in Article III, Section D;
    2. Refunds to applicants and policyholders for insurance premium 
overpayment, or if the application for insurance is rejected or when 
cancellation or endorsement of a policy results in a premium refund as 
described in Article III, Section E; and
    3. Allocated and unallocated Loss Adjustment Expenses as described 
in Article III, Section C.
    B. The FIA shall provide technical assistance to the Company as 
follows:
    1. The FIA's policy and history concerning underwriting and claims 
handling.
    2. A mechanism to assist in clarification of coverage and claims 
questions.
    3. Other assistance as needed.

                 Article V--Commencement and Termination

    A. Upon signature of authorized officials for both the Company and 
the FIA, this Arrangement shall be effective for the period October 1 
through September 30. The FIA shall provide financial assistance only 
for policy applications and endorsements accepted by the Company during 
this period

[[Page 310]]

pursuant to the Program's effective date, underwriting and eligibility 
rules.
    B. By June 1, of each year, the FIA shall publish in the Federal 
Register and make available to the Company the terms for the re-
subscription of this Financial Assistance/Subsidy Arrangement. In the 
event the Company chooses not to re-subscribe, it shall notify the FIA 
to that effect by the following July 1.
    C. In the event the Company elects not to participate in the Program 
in any subsequent fiscal year, or the FIA chooses not to renew the 
Company's participation, the FIA, at its option, may require (1) the 
continued performance of this entire Arrangement for a period not to 
exceed one (1) year following the original term of this Arrangement, or 
any renewal thereof, or (2) the transfer to the FIA of:
    1. All data received, produced, and maintained through the life of 
the Company's participation in the Program, including certain data, as 
determined by FIA, in a standard format and medium; and
    2. A plan for the orderly transfer to the FIA of any continuing 
responsibilities in administering the policies issued by the Company 
under the Program including provisions for coordination assistance; and
    3. All claims and policy files, including those pertaining to 
receipts and disbursements that have occurred during the life of each 
policy. In the event of a transfer of the services provided, the Company 
shall provide the FIA with a report showing, on a policy basis, any 
amounts due from or payable to insureds, agents, brokers, and others as 
of the transition date.
    D. Financial assistance under this Arrangement may be canceled by 
the FIA in its entirety upon 30 days written notice to the Company by 
certified mail stating one of the following reasons for such 
cancellation: (1) Fraud or misrepresentation by the Company subsequent 
to the inception of the contract, or (2) nonpayment to the FIA of any 
amount due the FIA. Under these very specific conditions, the FIA may 
require the transfer of data as shown in Section C., above. If transfer 
is required, the unearned expenses retained by the Company shall be 
remitted to the FIA. In such event the Government will assume all 
obligations and liabilities owed to policyholders under such policies 
arising before and after the date of transfer.
    E. In the event the Act is amended, or repealed, or expires, or if 
the FIA is otherwise without authority to continue the Program, 
financial assistance under this Arrangement may be canceled for any new 
or renewal business, but the Arrangement shall continue for policies in 
force that shall be allowed to run their term under the Arrangement.
    F. In the event that the Company is unable to, or otherwise fails 
to, carry out its obligations under this Arrangement by reason of any 
order or directive duly issued by the Department of Insurance of any 
Jurisdiction to which the Company is subject, the Company agrees to 
transfer, and the Government will accept, any and all WYO policies 
issued by the Company and in force as of the date of such inability or 
failure to perform. In such event the Government will assume all 
obligations and liabilities owed to policyholders under such policies 
arising before and after the date of transfer and the Company will 
immediately transfer to the Government all funds in its possession with 
respect to all such policies transferred and the unearned portion of the 
Company expenses for operating, administrative and loss adjustment on 
all such policies.

              Article VI--Information and Annual Statements

    The Company shall furnish to FEMA such summaries and analyses of 
information including claim file information, and property address, 
location, and/or site information in its records as may be necessary to 
carry out the purposes of the National Flood Insurance Act of 1968, as 
amended, in such form as the FIA, in cooperation with the Company, shall 
prescribe. The Company shall be a property/casualty insurer domiciled in 
a State or territory of the United States. Upon request, the Company 
shall file with the FIA a true and correct copy of the Company's Fire 
and Casualty Annual Statement, and Insurance Expense Exhibit or 
amendments thereof as filed with the State Insurance Authority of the 
Company's domiciliary State.

               Article VII--Cash Management and Accounting

    A. FEMA shall make available to the Company during the entire term 
of this Arrangement and any continuation period required by FIA pursuant 
to Article V, Section C., the Letter of Credit provided for in Article 
IV drawn on a repository bank within the Federal Reserve System upon 
which the Company may draw for reimbursement of its expenses as set 
forth in Article IV that exceed net written premiums collected by the 
Company from the effective date of this Arrangement or continuation 
period to the date of the draw.
    B. The Company shall remit all funds, including interest, not 
required to meet current expenditures to the United States Treasury, in 
accordance with the provisions of the WYO Accounting Procedures Manual 
or procedures approved in writing by the FIA.
    C. In the event the Company elects not to participate in the Program 
in any subsequent fiscal year, the Company and FIA shall make a 
provisional settlement of all amounts due or owing within three months 
of the termination of this Arrangement. This

[[Page 311]]

settlement shall include net premiums collected, funds drawn on the 
Letter of Credit, and reserves for outstanding claims. The Company and 
FIA agree to make a final settlement of accounts for all obligations 
arising from this Arrangement within 18 months of its expiration or 
termination, except for contingent liabilities that shall be listed by 
the Company. At the time of final settlement, the balance, if any, due 
the FIA or the Company shall be remitted by the other immediately and 
the operating year under this Arrangement shall be closed.

                        Article VIII--Arbitration

    If any misunderstanding or dispute arises between the Company and 
the FIA with reference to any factual issue under any provisions of this 
Arrangement or with respect to the FIA's non-renewal of the Company's 
participation, other than as to legal liability under or interpretation 
of the standard flood insurance policy, such misunderstanding or dispute 
may be submitted to arbitration for a determination that shall be 
binding upon approval by the FIA. The Company and the FIA may agree on 
and appoint an arbitrator who shall investigate the subject of the 
misunderstanding or dispute and make a determination. If the Company and 
the FIA cannot agree on the appointment of an arbitrator, then two 
arbitrators shall be appointed, one to be chosen by the Company and one 
by the FIA.
    The two arbitrators so chosen, if they are unable to reach an 
agreement, shall select a third arbitrator who shall act as umpire, and 
such umpire's determination shall become final only upon approval by the 
FIA.
    The Company and the FIA shall bear in equal shares all expenses of 
the arbitration. Findings, proposed awards, and determinations resulting 
from arbitration proceedings carried out under this section, upon 
objection by FIA or the Company, shall be inadmissible as evidence in 
any subsequent proceedings in any court of competent jurisdiction.
    This Article shall indefinitely succeed the term of this 
Arrangement.

                    Article IX--Errors and Omissions

    The parties shall not be liable to each other for damages caused by 
inadvertent delay, error, or omission made in connection with any 
transaction under this Arrangement. In the event of such actions, the 
responsible party must attempt to rectify that error as soon as possible 
after discovery of the error and act to mitigate any costs incurred due 
to that error. In the event that steps are not taken to rectify the 
situation and such action leads to claims against the company, the NFIP, 
or other related entities, the responsible party shall bear all 
liability attached to that delay, error or omission to the extent 
permissible by law.
    However, in the event that the Company has made a claim payment to 
an insured without including a mortgagee (or trustee) of which the 
Company had actual notice prior to making payment, and subsequently 
determines that the mortgagee (or trustee) is also entitled to any part 
of said claim payment, any additional payment shall not be paid by the 
Company from any portion of the premium and any funds derived from any 
Federal Letter of Credit deposited in the bank account described in 
Article II, section E. In addition, the Company agrees to hold the 
Federal Government harmless against any claim asserted against the 
Federal Government by any such mortgagee (or Trustee), as described in 
the preceding sentence, by reason of any claim payment made to any 
insured under the circumstances described above.

                   Article X--Officials Not to Benefit

    No Member or Delegate to Congress, or Resident Commissioner, shall 
be admitted to any share or part of this Arrangement, or to any benefit 
that may arise therefrom; but this provision shall not be construed to 
extend to this Arrangement if made with a corporation for its general 
benefit.

                           Article XI--Offset

    At the settlement of accounts the Company and the FIA shall have, 
and may exercise, the right to offset any balance or balances, whether 
on account of premiums, commissions, losses, loss adjustment expenses, 
salvage, or otherwise due one party to the other, its successors or 
assigns, hereunder or under any other Arrangements heretofore or 
hereafter entered into between the Company and the FIA. This right of 
offset shall not be affected or diminished because of insolvency of the 
Company.
    All debts or credits of the same class, whether liquidated or 
unliquidated, in favor of or against either party to this Arrangement on 
the date of entry, or any order of conservation, receivership, or 
liquidation, shall be deemed to be mutual debts and credits and shall be 
offset with the balance only to be allowed or paid. No offset shall be 
allowed where a conservator, receiver, or liquidator has been appointed 
and where an obligation was purchased by or transferred to a party 
hereunder to be used as an offset.
    Although a claim on the part of either party against the other may 
be unliquidated or undetermined in amount on the date of the entry of 
the order, such claim will be regarded as being in existence as of the 
date of such order and any credits or claims of the same class then in 
existence and held by the other party may be offset against it.

[[Page 312]]

                     Article XII--Equal Opportunity

    The Company shall not discriminate against any applicant for 
insurance because of race, color, religion, sex, age, handicap, marital 
status, or national origin.

           Article XIII--Restriction on Other Flood Insurance

    As a condition of entering into this Arrangement, the Company agrees 
that in any area in which the Administrator authorizes the purchase of 
flood insurance pursuant to the Program, all flood insurance offered and 
sold by the Company to persons eligible to buy pursuant to the Program 
for coverages available under the Program shall be written pursuant to 
this Arrangement.
    However, this restriction applies solely to policies providing only 
flood insurance. It does not apply to policies provided by the Company 
of which flood is one of the several perils covered, or where the flood 
insurance coverage amount is over and above the limits of liability 
available to the insured under the Program.

                Article XIV--Access to Books and Records

    The FIA and the Comptroller General of The United States, or their 
duly authorized representatives, for the purpose of investigation, 
audit, and examination shall have access to any books, documents, papers 
and records of the Company that are pertinent to this Arrangement. The 
Company shall keep records that fully disclose all matters pertinent to 
this Arrangement, including premiums and claims paid or payable under 
policies issued pursuant to this Arrangement. Records of accounts and 
records relating to financial assistance shall be retained and available 
for three (3) years after final settlement of accounts, and to financial 
assistance, three (3) years after final adjustment of such claims. The 
FIA shall have access to policyholder and claim records at all times for 
purposes of the review, defense, examination, adjustment, or 
investigation of any claim under a flood insurance policy subject to 
this Arrangement.

             Article XV--Compliance With Act and Regulations

    This Arrangement and all policies of insurance issued pursuant 
thereto shall be subject to the provisions of the National Flood 
Insurance Act of 1968, as amended, the Flood Disaster Protection Act of 
1973, as amended, the National Flood Insurance Reform Act of 1994, and 
Regulations issued pursuant thereto and all Regulations affecting the 
work that are issued pursuant thereto, during the term hereof.

 Article XVI--Relationship Between the Parties (Federal Government and 
                        Company) and the Insured

    Inasmuch as the Federal Government is a guarantor hereunder, the 
primary relationship between the Company and the Federal Government is 
one of a fiduciary nature, i.e., to assure that any taxpayer funds are 
accounted for and appropriately expended. The Company is not the agent 
of the Federal Government. The Company is solely responsible for its 
obligations to its insured under any flood policy issued pursuant 
hereto.

[62 FR 39910, July 24, 1997]

         Appendix B to Part 62--National Flood Insurance Program

  A Plan to Maintain Financial Control for Business Written Under the 
                         Write Your Own Program

    Under the Write Your Own (WYO) Program, the Federal Insurance 
Administrator (Administrator) may enter into arrangements with 
individual private sector insurance companies that are licensed to 
engage in the business of property insurance, whereby these companies 
may offer flood insurance coverage to eligible property owners using 
their customary business practices. To facilitate the marketing of flood 
insurance coverage, the Federal Government will be a guarantor of flood 
insurance coverage for WYO Company policies issued under the WYO 
Arrangement. To ensure that any taxpayer funds are accounted for and 
appropriately expended, the Federal Insurance Administration (FIA) and 
WYO Companies will implement this Financial Control Plan. Any departures 
from the requirements of this Plan must be approved by the 
Administrator. The authority for the WYO Program is contained in section 
1345 of the National Flood Insurance Act of 1968, 42 U.S.C. 4081, and 44 
CFR parts 61 and 62, Secs. 61.13 and 62.23. The WYO Financial 
Assistance/Subsidy Arrangement (Arrangement) which is included in 
appendix A of this part is hereby made a part of this Financial Control 
Plan.
    WYO Companies are subject to audit, examination, and regulatory 
controls of the various states. Additionally, insurance company 
operating departments are customarily subject to examinations and audits 
performed by Company internal audit or quality control departments, or 
both, and independent CPA firms. It is intended that this Plan use to 
the extent possible, the findings of these examinations and audits as 
they pertain to business written under the WYO Program (Parts 3 and 4).
    The WYO Financial Control Plan contains several checks and balances 
that can, if properly implemented by the WYO Company, significantly 
reduce the need for extensive

[[Page 313]]

on-site reviews of Company files by the FIA staff or their designee. 
Furthermore, we believe that this process is consistent with customary 
reinsurance practices and avoids duplication of examinations performed 
under the auspices of individual State Insurance Departments, NAIC Zone 
examinations, and independent CPA firms.
    The WYO Financial Control Plan requires the WYO Company to meet the 
minimum requirements established by the Standards Committee. The 
Standards Committee consists of four (4) members from FIA, one (1) 
member from the Federal Emergency Management Agency's (FEMA's) Office of 
Financial Management, one (1) member designated by the Administrator who 
is not directly involved in the WYO Program, and one (1) member from 
each of six (6) designated WYO Companies, pools or other entities.
    The WYO Financial Control Plan must require the WYO Company to:
    1. Have a biennial audit of the flood insurance financial statements 
and claims and underwriting activity conducted by an independent 
accounting firm at the Company's expense to ensure that the financial 
data reported to FIA accurately represents the flood insurance 
activities of the Company. Require that the CPA firm's audit be 
performed in accordance with GAO yellow book requirements. Require that 
the auditors conduct their own review sample, even if pre-selected 
policy and claims files are given to them for review.
    2. Meet the recording and reporting requirements of the WYO 
Transaction Record Reporting and Processing Plan. Transactions reported 
to the National Flood Insurance Program's (NFIP's) Bureau and 
Statistical Agent by the WYO Company under the WYO Transaction Record 
Reporting and Processing Plan will be analyzed by the Bureau and 
Statistical Agent and a monthly report will be submitted to the WYO 
Company and the FIA. The analysis will cover the timeliness of the WYO 
Company's submissions, the disposition of transactions that do not pass 
systems edits, and the reconciliation of the total generated from 
transaction reports with those submitted on the WYO Company's reports 
(part 1).
    3. Cooperate with FEMA's Office of Financial Management on Letter of 
Credit matters.
    4. Cooperate with FIA in the implementation of a claims reinspection 
program (part 2).
    5. Cooperate with FIA in the verification of risk rating 
information.
    6. Cooperate with FEMA's Office of the Inspector General on matters 
pertaining to fraud.
    The Standards Committee will review and make a recommendation to the 
Administrator concerning any adverse action arising from the 
implementation of the Financial Control Plan. Adverse actions include, 
but are not limited to, the FIA Operations Division's recommendation not 
to renew a particular Company's WYO arrangement.
    This Plan includes the following guidelines:
    Part 1--Transaction Record Reporting and Processing Plan 
Reconciliation Procedures
    Part 2--Claims Reinspection Program
    Part 3--Financial Audits, Underwriting Audits, Claims Audits, Audits 
for Cause, and State Insurance Department Audits
    Part 4--Reports Certifications
    Part 5--WYO Financial Assistance/Subsidy Arrangement (Incorporated 
by Reference)
    Part 6--Transaction Record Reporting and Processing Plan 
(Incorporated by Reference)
    Part 7--Write Your Own (WYO) Accounting Procedures Manual 
(Incorporated by Reference)

Part 1--Transaction Record Reporting and Processing Plan Reconciliation 
      Procedures, Transaction Record Reporting and Processing Plan 
                        Reconciliation Objectives

    The objectives are: To reconcile transaction detail with monthly 
financial statements submitted by the WYO Companies; to assess the 
quality and timeliness of submitted data; and to provide for the 
identification and resolution of discrepancies in the data. The reliance 
on computer processing to perform the review of transaction and 
financial data will help minimize the necessity for on-site audits of 
WYO Companies. Reconciliation of the statistical reports submitted will 
be performed by the WYO Companies and independently by the NFIP Bureau 
and Statistical Agent.
    The review of monthly financial statements and transaction level 
detail will involve six areas:
    A. Financial control;
    B. Quality control (audit trails);
    C. Quality review of submitted data;
    D. Policy rating;
    E. Timeliness of reporting; and
    F. Monthly reports.

                          A. Financial Control

    1. WYO Companies are required to submit a reconciliation report 
(Exhibit ``A'') with the submission of transaction level detail. This 
report will reconcile the transaction records data to the financial 
report, explaining any discrepancies.
    2. WYO Companies are required to submit, on a form approved by the 
Administrator, a tape transmittal document with the submission of the 
statistical tape containing transaction detail. This will be used to 
validate record counts and dollar amounts.
    3. The NFIP will review, at a minimum, the categories on the 
attached format and produce a similar report reconciling the

[[Page 314]]

transaction data to the monthly financial statement submitted by each 
WYO Company.
    4. To facilitate financial reconciliation, transaction records which 
do not pass various edits employed by the NFIP to review the quality of 
submitted data will be so identified, but will be maintained whenever 
possible until the error is corrected by the company in order to 
reconcile all financial data submitted to the NFIP.

                           B. Quality Control

    Transaction level detail will be maintained in policy and claim 
history files for record-keeping and audit purposes.

                   C. Quality Review of Submitted Data

    1. Transaction records will be edited for correct format and values.
    2. Relational edits will be performed on individual transactions as 
well as between policy and claim transactions submitted against those 
policies.
    3. Record validation will be performed to check that the transaction 
type is allowable for the type of policy or claim indicated.
    4. Errors will be categorized as critical or non-critical. The rate 
of critical errors in the submission of statistical data will be the 
basis by which company performance is reported to the Standards 
Committee. Critical errors include those made in required data elements. 
Required data elements:
    a. Identify the policyholder, the policy, the loss, and the property 
location;
    b. Provide information necessary to rate the policy;
    c. Provide information used in financial control; and
    d. Provide information used for actuarial review of NFIP experience.
    5. Non-critical errors are those made in data elements reported by 
the WYO Companies at their option.

                            D. Policy Rating

    1. The rating will be validated by the NFIP for all policies for 
which the following transactions have been submitted:
    a. New Business;
    b. Renewals;
    c. Endorsements involving type A transaction records; and
    d. Corrections of type A transaction records previously submitted 
for premium transactions.
    2. Incorrect rating will be considered a critical error.

                       E. Timeliness of Reporting

    1. WYO Companies will be expected to submit monthly statistical and 
financial reports within thirty days of the end of the month of record.
    2. The NFIP will produce reports based on review of submitted data 
within thirty days after the due date or the first processing cycle 
subsequent to the receipt of WYO Company submissions, whichever is 
later.

                           F. Monthly Reports

    1. Reports for each WYO Company's data submission will be sent to 
the respective WYO Company and the FIA explaining any discrepancies 
found by the NFIP review.
    2. Report to WYO Companies. Transaction records that fail to pass 
the quality review or policy rating edits will be reported to the 
appropriate Company in transaction detail with error codes, 
classification of errors as either critical or non-critical and any 
codes used by the Company to identify the source of the transaction 
data.
    3. Reports to WYO Companies and the FIA:
    a. Summary statistics will be generated for each monthly submission 
of transaction data. These will include:
    i. Absolute numbers of transactions read and transactions rejected 
by transaction type; and
    ii. Dollar amounts associated with transactions read and 
transactions rejected.
    b. Summary statistics for all policy and claim records submitted to 
date (which may each be the result of multiple transactions) will be 
generated, separately for critical and non-critical errors. These will 
include:
    i. Absolute number of policy and claim records on file and those 
containing errors; and
    ii. Relative values for the number of records containing critical 
errors.
    c. Control totals will be generated for tapes submitted to and 
processed by the NFIP. This front-end balancing procedure will include:
    i. Numbers of records submitted according to the NFIP compared with 
numbers of records submitted according to the WYO Company transmittal 
document; and
    ii. Dollar amounts submitted according to the NFIP compared with 
dollar amounts submitted according to the WYO Company transmittal 
document.
    d. If there is any discrepancy between the NFIP reading of dollar 
amounts from the tape and the WYO Company tape transmittal document, 
then the monthly statistical tape submission will be rejected and 
returned to the Company. The rejected tape must be corrected and 
resubmitted by the next monthly submission due date.
    e. In cases where the NFIP reconciliation of transaction level 
detail with the financial statements does not agree with the 
reconciliation report submitted by the WYO Company, a separate report 
will be generated and transmitted to the Company for resolution and to 
the FIA.

[[Page 315]]

     Reporting of Company Rating to the Standards Committee and the 
                              Administrator

                         A. Satisfactory Rating

    An annual end of the year report will be submitted to convey the 
satisfactory rating of WYO Companies' submission of transaction data and 
the reconciliation of these data with financial reports.

                        B. Unsatisfactory Rating

    The report of an unsatisfactory rating will be submitted as soon as 
errors and problems reach critical threshold levels. This rating will be 
based on: Continuing problems in reconciling transaction data with 
financial reports; statistics on the percentage of transactions 
submitted with critical errors; the percentage of policy and claim 
records on file that contain critical errors; and late submission of 
statistical and financial reports.

        Exhibit ``A''--WYO Statistical Tape--Transmittal Document

 Date Sent:_____________________________________________________________

 WYO Prefix Code:_______________________________________________________

 Address:_______________________________________________________________

 _______________________________________________________________________

Reel Number(s) of Enclosed

 Tapes:_________________________________________________________________

 Density________________________________________________________________

 LRECL__________________________________________________________________

 Blocksize______________________________________________________________

 File Name (DSN)________________________________________________________

 Contact Person_________________________________________________________

 Contact Number_________________________________________________________

 IBU No. (WYO Use Only)_________________________________________________

              Monthly Reconciliation--Net Written Premiums

 Company name___________________________________________________________

 Co. NAIC No.___________________________________________________________

 Month/year ending______________________________________________________

 Date submitted_________________________________________________________

 Preparer's name________________________________________________________

 Telephone No___________________________________________________________


                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                         Monthly statistical transactions report                
       Monthly financial report        -------------------------------------------------------------------------
                                                    Trans. code                Record count      Premium amount 
----------------------------------------------------------------------------------------------------------------
Net Written premiums..................  $                                                                       
    (Income statement = Line 100......  11                                  .................      $            
                                        15                                  .................  .................
                                        17                                  .................  .................
Unprocessed statistical:                                                                                        
    (+) Prior month's.................  20                                  .................  .................
    (-) Current month's...............  23                                  .................  .................
Other--Explain:                                                                                                 
    (+) Current month's...............  26                                  .................        (-)        
    (-) Prior month's.................  29                                  .................        (-)        
                                        14 and 81                           .................        (+)        
                                       -------------------------------------------------------------------------
        Total.........................  Total:                              .................  .................
                                        (Add 11 Through 23 less 26 and 29)                                      
                                       -------------------------------------------------------------------------
Comments:                                                                                                       
----------------------------------------------------------------------------------------------------------------

                     Monthly Reconciliation--Losses

 Company name

 Co. NAIC No.

 Month/year

 Date submitted

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                                                                   Loss/paid    
                                                    Trans. code                Record count        recoveries   
----------------------------------------------------------------------------------------------------------------
100 Net paid losses...................  $                                   .................  .................
(Income statement line 115)             ..................................                                      
Unprocessed statistical:                ..................................  .................  .................
                                        31                                  .................     $             
    140 (+) Prior month's.............  34                                  .................  .................
                                        37                                  .................  .................
    150 (-) Current month.............  40                                  .................  .................
                                        43                                  .................  .................
    160 Salvage not to be reported by   ..................................  .................  .................
     transaction (explain).                                                                                     
    170 Other--Explain................  46 and 61                           .................  .................
                                        49                                  .................  .................
                                        64                                  .................  .................

[[Page 316]]

                                                                                                                
                                        84 and 87                           .................  .................
                                        52 Recovery                         .................  .................
                                        Salvage                             .................  .................
                                        Subrogation                         .................  .................
                                        67 Recovery                         .................  .................
                                        Salvage                             .................  .................
                                        Subrogation                         .................  .................
                                       -------------------------------------------------------------------------
        Total:........................  Total:                              .................  .................
                                       -------------------------------------------------------------------------
        (Sum of Lines 100, 140, 160,     (Add 31, 34, 40 through 64 less                                        
         and 170 less 150).              52 and 67)                                                             
                                       -------------------------------------------------------------------------
Comments:                                                                                                       
----------------------------------------------------------------------------------------------------------------

              Monthly Reconciliation--Special Allocated LAE

 Company name

 Co. NAIC No.

 Month/year ending

 Date submitted

                                                                                                                
----------------------------------------------------------------------------------------------------------------
                                                         Monthly statistical transaction report                 
       Monthly financial report        -------------------------------------------------------------------------
                                                    Trans. code                Record count         Amounts     
----------------------------------------------------------------------------------------------------------------
Special allocated loss adjustment       ..................................  .................  .................
 expenses.                                                                                                      
(Other loss and LAE Calc.--Line 655)                                                                            
                                        71                                  .................     $             
                                        74                                  .................  .................
Unprocessed statistical:                                                                                        
    (+) Prior Month...................  ..................................  .................  .................
    (-) Current Month.................  ..................................  .................  .................
Other--Explain:                                                                                                 
    (1)...............................  ..................................  .................  .................
    (2)...............................  ..................................  .................  .................
                                       -------------------------------------------------------------------------
                Total:................  Total:                              .................  .................
                                       -------------------------------------------------------------------------
Comments:                                                                                                       
----------------------------------------------------------------------------------------------------------------

             Monthly Reconciliation--Net Policy Service Fees

 Company Name___________________________________________________________

 Co. NAIC No.___________________________________________________________

 Month/Year Ending______________________________________________________

 Date Submitted_________________________________________________________

                        Monthly Financial Report

Net Policy Service Fees (Income Statement Line 170):

 $______________________________________________________________________

Unprocessed statistical:

 (+) Prior Month's______________________________________________________

 (-) Current Month's____________________________________________________

Other--Explain:

 (1)____________________________________________________________________

 (2)____________________________________________________________________

 Total__________________________________________________________________

Comments:

                 Monthly Statistical Transaction Report

 Record Count:__________________________________________________________

 Fee Amount:____________________________________________________________

 Total:_________________________________________________________________

(Approved by the Office of Management and Budget under OMB control 
number 3067-0169.)

                   Part 2--Claims Reinspection Program

                  WYO-NFIP Claims Reinspection Program

    To keep WYO-NFIP Claims Management informed, to assist in the 
overall claims operation, and to provide necessary assurances and 
documentation for dealing with GAO, Congressional Oversight Committees, 
and the public, the FIA and WYO Companies have established a Claims 
Reinspection Program. The Program is comprised of the following major 
elements:
    A. All files are subject to reinspection.
    B. Files for reinspection may be randomly selected by flood event, 
or size of loss, or class of business, as determined by WYO-NFIP Claims 
Management.

[[Page 317]]

    C. WYO-NFIP Claims Management will utilize a binomial table to 
define sample size for reinspections prior to payment. A larger sample 
may be used depending upon error ratio.
    D. An agreed upon sample of closed files, by event, will be 
subjected to reinspection as well.
    E. A WYO representative will conduct the reinspection, accompanied 
by an NFIP General Adjuster.
    F. A joint, single report will be issued by the WYO Company 
representative and the NFIP General Adjuster.
    G. Copies of reinspection reports will be forwarded to the Claims 
Management of both the WYO Company and the NFIP.

Part 3---Biennial Financial Audits, Underwriting Audits, Claims Audits, 
         Audits for Cause, and State Insurance Department Audits

          A. Biennial Financial, Underwriting and Claims Audits

    1. Objectives of WYO Biennial Financial Underwriting and Claims 
Audit. The biennial, financial, underwriting and claims audit is 
intended to provide the Federal Emergency Management Agency with 
independent assessment of the quality of financial controls over 
activities relating to the Company's participation in the National Flood 
Insurance Program as well as the integrity of the underwriting and 
claims data reported to FEMA.
    a. Participating WYO companies are responsible for selecting and 
funding independent Certified Public Accounting firms to conduct the 
biennial audits. Such costs are considered part of the normal 
administrative cost of operating the WYO program and as such are 
included in the WYO expense allowance.
    b. The WYO Company's representative will be notified in writing to 
arrange for a biennial audit. This notice should provide the WYO Company 
at least 120 days to prepare for the biennial audit.
    c. It is also intended that the biennial audit will reduce if not 
eliminate the need for FEMA auditors or their designees to conduct on-
site visits to WYO companies in their review of financial activity. 
However, the requirement may still exist for such visits to occur as 
determined by the auditors. The CPA firm's audit shall be performed in 
accordance with GAO yellow book requirements. Further, the CPA firm is 
required to select its own sample, even though FIA may provide them with 
pre-selected policy and claim files for review. In addition, nothing in 
this section should be construed as limiting the ability of the General 
Accounting Office or FEMA's Office of Inspector General to review the 
activities of the WYO Program.
    d. The purpose of the biennial audit is to provide opinion on the 
fairness of the financial statements, the adequacy of internal controls, 
and the extent of compliance with laws and regulations.
    e. Any WYO Company which has been subject to a comprehensive audit 
by the CPA firm under contract with the FEMA OIG is exempted by its 
selected Certified Public Accountant firm. Only the remaining unaudited 
fiscal year of the two years normally to be reviewed under the biennial 
audit will be examined. Policy and claim related financial data as 
reported to the NFIP are proper and adequately supported by underlying 
documentation.

                           B. Audits for Cause

    In accordance with the terms of the Arrangement, the Administrator, 
on his/her own initiative or upon recommendation of the WYO Standards 
Committee or the FEMA Inspector General, may conduct for-cause audits of 
participating companies. The following criteria, in combination or 
independently, may constitute the basis for initiation of such an audit.

                             1. Underwriting

    a. Excessively high frequency of errors in underwriting.
    i. Issuing policies for ineligible risks.
    ii. Issuing policies in ineligible communities.
    iii. Consistent premium rating errors.
    iv. Missing or insufficient documentation for submit for rate 
policies.
    v. Other patterns of consistent errors.
    b. Abnormally high rate of policy cancellations or non-renewals.
    c. Policies not processed in a timely fashion.
    d. Duplication of policy coverage noted.
    e. Relational type edits indicate an usually high or low premium 
amount per policy for the geographical area.
    f. Biennial audit results indicate usual volume of errors in 
underwriting.
    2. Claims
    a. Reinspection indicates consistent patterns of:
    i. Losses being paid when not covered.
    ii. Statistical information being reported on original loss 
adjustment found to be incorrect on reinspection.
    iii. Salvage/subrogation not being adequately addressed.
    iv. Consistent overpayment of claims.
    b. Unusually high count of erroneous assignments and/or claims 
closed without payment (CWP).
    c. Unusually low count of CWP. (May indicate inadequate follow-up of 
claims submitted).
    d. Average claim payments that significantly exceed the average for 
the Program as a whole.

[[Page 318]]

    e. Lack of (adequate) documentation for paid claims.
    f. Claims not processed in a timely fashion.
    g. Consistent failure of WYO Company to receive authorization for 
special allocated loss adjustment expenses prior to incurring them.
    h. High submission of Special Allocated Loss Adjustment Expenses 
(SALAE).
    i. Consistently high policyholder complaint level.
    j. Low/high count of salvage/subrogation.
    k. Biennial audit indicates significant problems.
    3. Financial Reporting/Accounting
    a. Consistently high reconciliation variations and/or errors in 
statistical information.
    b. Financial and/or statistical information not received in a timely 
fashion.
    c. Letter of Credit violations are found.
    d. WYO Company is not depositing funds to the Restricted Account in 
a timely manner, or funds are not being transferred through the 
automated clearinghouse on a timely basis.
    e. Premium suspense is consistently significant, older than 60 days, 
and/or cannot be detailed sufficiently, or both.
    f. Large/unusual balance in Cash-Other (Receivables and/or Payable).
    g. Large, unexplained differences in cash reconciliation.
    h. Large/unusual balances or variations between months noted for key 
reported financial data.
    i. Financial statement to statistical data reconciliation sheets 
improperly completed indicating proper review of information is not 
being performed prior to signing certification statement.
    j. Repeated failure to respond fully in a timely manner to questions 
raised by FIA or the NFIP Bureau and Statistical Agent concerning 
monthly financial reporting.
    k. Biennial audit indicates significant problems.

                          C. Underwriting Audit

    1. Samples of new business policies, renewals, endorsements and 
cancellations will be provided by the FIA with the biennial audit 
instructions, including samples of the Mortgage Portfolio Protection 
business, where applicable. The audit is to be conducted in accordance 
with GAO yellow book requirements. The CPA firm may supplement with its 
own sample of risks which were in force during all or part of the 
Arrangement Year under audit for detail testing.

                      2. Underwriting Audit Outline

    a. Review of the Underwriting Department's responsibilities, 
authorities and composition.
    b. Personal interviews with management and key clerical personnel to 
determine current processing activities, planned changes and problems.
    c. Administrative review to verify compliance with company 
procedures.
    d. Thorough examination of a random sample of underwriting files to 
measure the quality of work. The CPA firm is expected to provide a 
representative sample of its review to substantiate its opinion and 
findings. At a minimum, the files should be reviewed to verify the 
following:
    i. Policies are issued for eligible risks;
    ii. Rates are correct and consistent with the amount of insurance 
requested on the application;
    iii. Waiting period for new business is consistent with government 
regulations;
    iv. Elevation certification or difference is correctly shown on 
application;
    v. The coverage does not include more than one building and/or its 
contents per policy;
    vi. No binder is effective unless issued with the authorization of 
FIA;
    vii. The FIRM zone shown on the application to the community in 
which the property is located;
    viii. Community shown on application is eligible to purchase 
insurance under the NFIP;
    ix. Information on type of building, etc., is fully complete;
    x. Applicable deductibles are recorded;
    xi. A new, fully completed application or a photocopy of the most 
recent application, or similar documentation, with the appropriate 
updates to reflect current information is on file for each risk, 
including those formerly written by the NFIP Servicing Facility;
    xii. If any files to be audited are unavailable, determine the 
reason for the absence.
    e. Endorsement Processing.
    1. Complete tasks as applicable.
    2. Review requests for additional coverage to ensure that they are 
subject to the waiting period rule.
    3. Review controls established to ensure that no risk is insured 
under endorsement provisions that are not acceptable as a new business 
risk (i.e., a property located in a suspended community).
    f. Cancellation Processing. Verify controls to ensure that one of 
the necessary reasons for cancellation exists and that the transaction 
is accompanied by proper documentation.
    g. Renewal Processing. Determine controls to ensure that all 
necessary information needed to complete the transaction is provided.
    h. Expired Policies. Determine controls to ensure that each step is 
carried out at the proper time.
    i. Observance of Waiting Period. Establish procedures to document, 
as a matter of WYO

[[Page 319]]

Company business record and in each transaction involving a new 
application, renewal, and endorsement, that any applicable effective 
date and premium receipt rules have been observed (44 CFR 61.11). 
Documentation reasonably suitable for the purpose includes retention of 
postmarked envelopes (for three (3) years) from date, date stamping and 
retention (via hard copy or microfilm process) of application, renewal 
and endorsement documents and checks received in payment of premium; 
computer input of document and premium receipt transactions and 
retention of such records in the computer system; and other reasonable 
insurer methods of verifying transactions involving requests for 
coverage and receipts of premium.

                         D. Claims Audit Outline

    1. Review of the Claims Department's responsibilities, authorities, 
and composition.
    2. Personal interviews with management and key clerical personnel to 
determine current processing activities, planned changes and problems.
    3. Administrative review to verify compliance with company 
procedures.
    4. Thorough examination of a random sample of claims files which may 
be provided by FIA to measure the quality of work. At a minimum, the 
files should be reviewed to verify the following:
    a. Verify controls to ensure that a file is set up for each Notice 
of Loss Received.
    b. Review adjuster reports to determine whether they contain 
adequate evidence to substantiate the payment or denial of claims, 
including amount of losses claimed, any salvage proceeds, depreciation 
and potential subrogation.
    c. Ascertain that building and contents allocations are correct.
    d. Determine whether the file contains evidence identifying 
subrogation possibilities.
    e. Verify that partial payments were properly considered in 
processing the final draft or check.
    f. Verify that the loss payees are listed correctly (consider 
insured and mortgagee).
    g. Verify that the total amount of the drafts or checks is within 
the policy limits.
    h. Ascertain the relevance and validity of the criteria used by the 
carrier to judge effectiveness of its claims servicing operation.
    i. Confirm that when information is received from an independent 
adjuster, the examiner either acts promptly to give proper feedback with 
instructions or takes action to pay or deny the loss.
    j. Determine whether the Claims Department is using an ``impression 
of risk'' program in reporting misrated policies, etc.
    k. Where attempts at fraud occur, verify that these instances are 
being reported to FIA for referral to the FEMA Inspector General's 
office.
    i. If any files to be audited are unavailable, determine the reason 
for their absence. In undertaking this portion of the biennial audit, 
the Administrative Review Checklist (Exhibit B) below should be 
utilized.

             Exhibit ``B''--Administrative Review Checklist

Policy #:
Insured's Name:
State:
Date of loss:
Date paid:
Date reported:
Amt. of loss: $
Bldg: $
Contents: $
Adjusting firm:
Examiner's name:
Comments:

                    1. Investigation and Adjustments

                                                                        
                                                                        
                                                 Yes       No      N/A  
                                                                        
A. Application of Coverage.                                             
(1) Insurable Interest?......................    [  ]     [  ]     [  ] 
(2) Is loss from the flood peril?............    [  ]     [  ]     [  ] 
(3) Did loss occur within the policy term:...    [  ]     [  ]     [  ] 
(4) Does location and description of risk                               
 coincide with policy information?...........    [  ]     [  ]     [  ] 
(5) Were proper deductibles applied?.........    [  ]     [  ]     [  ] 
(6) Other insurance considered?..............    [  ]     [  ]     [  ] 
(7) Other losses?............................    [  ]     [  ]     [  ] 
B. Application of Sound Adjusting Practices:                            
(1) Was adjuster's report accurate/complete?.    [  ]     [  ]     [  ] 
(2) Was an attorney used in the settlement?..    [  ]     [  ]     [  ] 
(3) Was a technical expert used in the                                  
 settlement?.................................    [  ]     [  ]     [  ] 
C. Documentation:                                                       
(1) Are damages clearly identified?..........    [  ]     [  ]     [  ] 
(2) Are damages flood related?...............    [  ]     [  ]     [  ] 
(3) Are damages clearly and completely                                  
 itemized and documented by the adjuster?....    [  ]     [  ]     [  ] 
(4) Was depreciation considered?.............    [  ]     [  ]     [  ] 
(5) Has subrogation been considered..........    [  ]     [  ]     [  ] 
(6) Has salvage been properly handled?.......    [  ]     [  ]     [  ] 
(7) Was salvage timely?......................    [  ]     [  ]     [  ] 
2. Supervision:                                                         

[[Page 320]]

                                                                        
a. Assignments:                                                         
(1) Are assignments made promptly?...........    [  ]     [  ]     [  ] 
(2) Is insured contacted promptly?...........    [  ]     [  ]     [  ] 
b. Reserves:                                                            
(1) Are initial reserves indicated on the                               
 first report?...............................    [  ]     [  ]     [  ] 
(2) Are they adequate?.......................    [  ]     [  ]     [  ] 
(3) Does final settlement compare favorably                             
 with last reserve established?..............    [  ]     [  ]     [  ] 
c. Diary Control:                                                       
(1) Automatic?...............................    [  ]     [  ]     [  ] 
(2) Timely?..................................    [  ]     [  ]     [  ] 
(3) Is file reviewed at diary date with                                 
 examiner's comments?........................    [  ]     [  ]     [  ] 
d. Examiner Evaluation and Settlement                                   
 Performances:                                                          
(1) Is examiner directing adjuster when                                 
 needed?.....................................    [  ]     [  ]     [  ] 
(2) Are files documented?....................    [  ]     [  ]     [  ] 
(3) Is adequate control maintained over in-                             
 house adjuster?.............................    [  ]     [  ]     [  ] 
(4) Is adequate control maintained over                                 
 outside adjuster?...........................    [  ]     [  ]     [  ] 
e. Salvage and subrogation:                                             
(1) Is salvage evaluated by salvors?.........    [  ]     [  ]     [  ] 
(2) Is salvage disposed of promptly?.........    [  ]     [  ]     [  ] 
(3) Are salvage returns adequate?............    [  ]     [  ]     [  ] 
(4) Is potential subrogation being promptly                             
 and properly investigated?..................    [  ]     [  ]     [  ] 
(5) Are proper subrogation forms used?.......    [  ]     [  ]     [  ] 
(6) Are subrogation and salvage files                                   
 properly opened, diaried, and referred (if                             
 appropriate)?...............................    [  ]     [  ]     [  ] 
(7) Are recovery funds for subrogation and                              
 salvage being properly handled?.............    [  ]     [  ]     [  ] 
f. Suits:                                                               
(1) Are suits properly identified?...........    [  ]     [  ]     [  ] 
(2) Are suits being properly evaluated?......    [  ]     [  ]     [  ] 
(3) Are suits being referred to attorneys                               
 promptly?...................................    [  ]     [  ]     [  ] 
(4) Are attorneys being advised as to                                   
 handling settlement or compromise?..........    [  ]     [  ]     [  ] 
(5) Are suits being properly controlled?.....    [  ]     [  ]     [  ] 
(6) Are suits files properly diaried?........    [  ]     [  ]     [  ] 
(7)-(8) [Reserved]...........................                           
g. Other:                                                               
(1) Was there other coverage by the WYO                                 
 Company?....................................    [  ]     [  ]     [  ] 
(2) Were damages correctly apportioned?......    [  ]     [  ]     [  ] 
(3) Was a solo adjuster used?................    [  ]     [  ]     [  ] 
(4) Were there prior flood claims?...........    [  ]     [  ]     [  ] 
(5) Were prior damages repaired?.............    [  ]     [  ]     [  ] 
(6) Were prior claim files reviewed?.........    [  ]     [  ]     [  ] 
(7) Was a Congressional complaint letter in                             
 file?.......................................    [  ]     [  ]     [  ] 
(8) Was it responded to promptly?............    [  ]     [  ]     [  ] 
(9) Is the statistical reporting correction                             
 file being properly managed?................    [  ]     [  ]     [  ] 
                                                                        

                E. State Insurance Department Examination

    1. It is expected that audits of WYO companies by independent 
accountants and/or state insurance departments, aside from those 
conducted by the FIA or its designee, will include flood insurance 
activity. When such audits occur, a financial officer for the WYO 
Company will notify the FIA, identifying the auditing entity and 
providing a brief statement of the overall conclusions that relate to 
flood insurance and the insurer's financial condition, when available. 
In the case of an audit in progress, a brief statement on the scope of 
the audit should be provided to the FIA. A checklist will be utilized 
for this reporting and will be provided to WYO Companies by the FIA.
    2. The WYO Companies will maintain on file the reports resulting 
from audits, subject to on-site inspection by the FIA or its designee. 
At the FIA's request, the WYO Company will submit a copy of the 
auditor's opinion, should one be available, summarizing the audit 
conclusion. ``(Approved by the Office of Management and Budget under OMB 
control number 3067-0169)''
    a. Certification Statement for Monthly Financial and Statistical 
Reconciliation Reports.
    I have reviewed the accompanying financial and statistical 
reconciliation reports of

[[Page 321]]

XYZ Company as of 
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm. All information 
included in these statements is the representation of the XYZ Company.
    Based on my review (with the exception of the matter(s) described in 
the following paragraphs, if applicable), I certify that I am not aware 
of any material modifications that should be made to the accompanying 
reports.

 Signed_________________________________________________________________

    (Responsible Financial Officer)
 Date___________________________________________________________________

  B. Certification Statement for Monthly Statistical Transaction Report

    I have reviewed the accompanying statistical transaction report 
control totals in conjunction with appropriate statistical 
reconciliation reports. All information included in these reports is the 
representation of the XYZ Company. ``(Approved by the Office of 
Management and Budget under OMB control number 3067-0169).''

 Signed_________________________________________________________________

(Responsible Reporting Officer)

 Date___________________________________________________________________

[61 FR 51221, Oct. 1, 1996]



PART 63--IMPLEMENTATION OF SECTION 1306(c) OF THE NATIONAL FLOOD INSURANCE ACT OF 1968--Table of Contents




                           Subpart A--General

Sec.
63.1  Purpose of part.
63.2  Condemnation in lieu of certification.
63.3  Requirement to be covered by a contract for flood insurance by 
          June 1, 1988.
63.4  Property not covered.
63.5  Coverage for contents removal.
63.6  Reimbursable relocation costs.
63.7  Amount of coverage and deductible on effective date of 
          condemnation or certification.
63.8  Limitation on amount of benefits.
63.9  Sale while claim pending.
63.10  Demolition or relocation contractor to be joint payee.
63.11  Requirement for a commitment before October 1, 1989.
63.12  Setback and community flood plain management requirements.

    Subpart B--State Certification of Structures Subject to Imminent 
                                Collapse

63.13  Purpose of subpart.
63.14  Criteria for State qualification to perform imminent collapse 
          certifications.
63.15  State application for eligibility to certify structures subject 
          to imminent collapse.
63.16  Review of State application by the Administrator.
63.17  Procedures and data requirements for imminent collapse 
          certifications by States.
63.18  Review of State certification by the Administrator.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.

    Source: 53 FR 36975, Sept. 23, 1988, unless otherwise noted.



                           Subpart A--General



Sec. 63.1  Purpose of part.

    The purpose of this part is to implement section 1306(c) of the 
National Flood Insurance Act of 1968, as amended (the Act). Section 544 
of the Housing and Community Development Act of 1987 (Pub. L. 100-242) 
amended the Act by adding subsection (c) to section 1306 of the Act. 
Under this amendment, effective February 5, 1988, section 1306(c) of the 
Act provides for benefit payments under the Standard Flood Insurance 
Policy (SFIP) for demolition or relocation of a structure insured under 
the Act that is located along the shore of a lake or other body of water 
and that is certified by an appropriate State or local land use 
authority to be subject to imminent collapse or subsidence as a result 
of erosion or undermining caused by waves or currents of water exceeding 
anticipated cyclical levels. This part establishes criteria by which 
States can obtain the approval of the Administrator to make these 
certifications and sets forth the procedures and data requirements to be 
used by those States in making these certifications. This part also 
contains provisions regarding other aspects of section 1306(c) of the 
Act. For example, there are provisions regarding section 1306(c)(6)(B) 
of the Act (which provides for condemnation in lieu of certification), 
including clarification as to the form of condemnation issued under a 
State or local law that is required.



Sec. 63.2  Condemnation in lieu of certification.

    (a) The condemnation required by section 1306(c)(6)(B) of the Act in 
lieu of certification need not be grounded in

[[Page 322]]

a finding that the structure is subject to imminent collapse or 
subsidence as a result of erosion, but may be issued for other reasons 
deemed sufficient by the State or local authority.
    (b) The condemnation may be in the form of a court order or other 
instrument authorized by State or local law, e.g., a notification to the 
property owner of an unsafe condition, or unsanitary condition, or other 
deficiency at the property address, coupled with a statement that the 
property owner must vacate the property if the condition giving rise to 
the condemnation notice is not cured by repair, removal, or demolition 
of the building by a date certain.
    (c) In addition to a condemnation in accordance with paragraphs (a) 
and (b) of this section, a structure must be found by the Administrator 
to be subject to imminent collapse or subsidence as a result of erosion 
or undermining caused by waves or currents of water exceeding 
anticipated cyclical levels to be eligible for benefits under section 
1306(c) of the Act.



Sec. 63.3  Requirement to be covered by a contract for flood insurance by June 1, 1988.

    The requirement in section 1306(c)(4)(C)(i) of the Act that a 
structure be ``covered by a contract for flood insurance under this 
title--(i) on or before June 1, 1988'' was met if presentation of the 
appropriate premium and a properly completed flood insurance application 
form was made to the National Flood Insurance Program or a Write Your 
Own (WYO) Company on or before June 1, 1988.



Sec. 63.4  Property not covered.

    Benefits under section 1306(c) of the Act do not include 
compensation for items excluded under the provisions of the Standard 
Flood Insurance Policy (SFIP).



Sec. 63.5  Coverage for contents removal.

    Whenever a structure is subject to imminent collapse or subsidence 
as a result of erosion or undermining caused by waves or currents of 
water exceeding anticipated cyclical levels and otherwise meets the 
requirements of section 1306(c) of the Act so that benefits are payable 
under those provisions, the coverage in the definition of ``Direct 
Physical Loss by or from Flood'' in the SFIP for the expense of removing 
contents, up to the minimum deductible of $500.00, to protect and 
preserve them from flood or from the imminent danger of flood, applies 
if contents coverage is in effect.



Sec. 63.6  Reimbursable relocation costs.

    In addition to the coverage described in Sec. 63.5 of this part, 
relocation costs for which benefits are payable under section 1306(c) of 
the Act include the costs of:
    (a) Removing the structure from the site,
    (b) Site cleanup,
    (c) Debris removal,
    (d) Moving the structure to a new site, and
    (e) At the new site, a new foundation and related grading, including 
elevating the structure as required by local flood plain management 
ordinances, and sewer, septic, electric, gas, telephone, and water 
connections at the building.



Sec. 63.7  Amount of coverage and deductible on effective date of condemnation or certification.

    The amount of building coverage and the deductible applicable to a 
claim for benefits under section 1306(c) of the Act are what was in 
effect on the date of condemnation or the date of application for 
certification.

[53 FR 36975, Sept. 23, 1988, as amended at 53 FR 44193, Nov. 2, 1988]



Sec. 63.8  Limitation on amount of benefits.

    (a) In section 1306(c)(3)(C) of the Act, the phrase under the flood 
insurance contract issued pursuant to this title means the value of the 
structure under section 1306(c)(3)(C) of the Act is limited to the 
amount of building coverage provided by the insured's policy.
    (b) Where the amount payable under section 1306(c)(1)(A)(ii) of the 
Act for the cost of demolition, together with the amount payable under 
section 1306(c)(1)(A) of the Act for the value of the structure under 
the demolition option, exceeds the amount of building

[[Page 323]]

coverage provided by the insured's policy, such amounts will be paid 
beyond the amount of that building coverage, even if this payment 
exceeds the limits of coverage otherwise authorized by section 1306(a) 
of the Act for the particular class of property.



Sec. 63.9  Sale while claim pending.

    If a claimant sells a structure prior to its demolition or 
relocation, no benefits are payable to that claimant under section 
1306(c) of the Act, and any payments which may have been made under 
those provisions shall be reimbursed to the insurer making them.



Sec. 63.10  Demolition or relocation contractor to be joint payee.

    If a demolition or relocation contractor is used, the instrument of 
payment for benefits under section 1306(c) of the Act for the fee of 
that contractor, shall include that contractor as a joint payee, unless 
that contractor has already been paid when the instrument of payment is 
issued.



Sec. 63.11  Requirement for a commitment before October 1, 1989.

    The requirement in section 1306(c)(7) of the Act that a commitment 
be made on or before September 30, 1989 as a necessary condition to 
making any payments after September 30, 1989, is met if before October 
1, 1989,
    (a) There is either a condemnation in accordance with Sec. 63.2 of 
this part or a certification in accordance with subpart B of this part, 
and
    (b) A policyholder's notice of claim for benefits under section 
1306(c) of the Act is received by the insurer.



Sec. 63.12  Setback and community flood plain management requirements.

    (a) Where benefits have been paid under section 1306(c) of the Act, 
the setback requirements in section 1306(c)(5) of the Act, which if not 
met result in a prohibition against subsequently providing flood 
insurance or assistance under the Disaster Relief Act of 1974, shall 
apply:
    (1) To the structure involved wherever it is located, and
    (2) To any other structure subsequently constructed on or moved to 
the parcel of land on which the structure involved was located when the 
claim under section 1306(c) of the Act arose.
    (b) In addition, any structures relocated under section 1306 of the 
Act must comply with the flood plain management criteria set forth in 
Sec. 60.3 of this chapter.



    Subpart B--State Certification of Structures Subject to Imminent 
                                Collapse



Sec. 63.13  Purpose of subpart.

    The purpose of this subpart is to establish criteria under the 
provisions of section 1306(c) of the National Flood Insurance Act of 
1968, as amended, by which States can obtain approval from the 
Administrator to certify that structures are subject to imminent 
collapse or subsidence as a result of erosion or undermining caused by 
waves or currents of water exceeding anticipated cyclical levels. The 
subpart also sets forth the procedures and data requirements to be 
utilized by those States in certifying structures as subject to imminent 
collapse. The State certification procedure represents an option to the 
use of the procedure whereby a structure is condemned by a State or 
local authority as a prerequisite to consideration for imminent collapse 
insurance benefits.



Sec. 63.14  Criteria for State qualification to perform imminent collapse certifications.

    In order to qualify under this subpart, the State must be 
administering a coastal zone management program which includes the 
following components, as a minimum:
    (a) A state-wide requirement that prohibits new construction and the 
relocation of structures seaward of an adopted erosion setback. Such 
setback must be based in whole or in part on some multiple of the local 
mean annual erosion (recession) rate; and
    (b) An established, complete and functional data base of mean annual 
erosion rates for all reaches of coastal shorelines subject to erosion 
in the State, which is used as the basis to enforce these setback 
requirements.

[[Page 324]]



Sec. 63.15  State application for eligibility to certify structures subject to imminent collapse.

    (a) Application pursuant to this part shall be made by the Governor 
or other duly authorized official of the State.
    (b) The application must be submitted to the Federal Emergency 
Management Agency, Federal Insurance Administration, 500 C Street SW., 
Washington, DC 20472.
    (c) Documents to be included in the application are as follows:
    (1) Copies of all applicable State statutes and regulations 
verifying the existence of a coastal zone management program including 
setback requirements for new and relocated construction which are based 
in whole or in part on mean annual erosion rates established for the 
State's shorelines.
    (2) A copy of the State's mean annual erosion rate data base, if not 
already provided, showing such rates for all reaches of coastal 
shorelines subject to erosion within the State.
    (3) The title, address and phone number of a contact person within 
the State agency having authority for administering the coastal zone 
management program.
    (4) A statement that adequate resources are available to carry out 
the certification services, and that certifications will be performed in 
accordance with the procedures described in Sec. 63.17.



Sec. 63.16  Review of State application by the Administrator.

    (a) The Administrator may return the application for eligibility 
upon finding it incomplete or upon finding that additional information 
is required in order to make a determination as to the adequacy of the 
coastal zone management program and erosion rate data base.
    (b) Upon determining that the State's program and/or data base does 
not meet the criteria set forth in Sec. 63.14, the Administrator shall 
in writing reject the application for eligibility and indicate in what 
respects the State program and/or data base fails to comply with the 
criteria.
    (c) Upon determining that the State program and data base meets the 
criteria set forth in Sec. 63.14, the Administrator shall approve the 
State as eligible to certify structures subject to imminent collapse. 
Such approval, however, is in all cases provisional. The Administrator 
shall review the State program and data base for continued compliance 
with the criteria set forth in this part and may request updated 
documentation for the purpose of such review. If the program and/or data 
base is found to be inadequate and is not corrected within ninety days 
from the date that such inadequacies were identified, the Administrator 
may revoke his approval.



Sec. 63.17  Procedures and data requirements for imminent collapse certifications by States.

    Any State that has been determined to be eligible by the 
Administrator may certify that a coastal structure is subject to 
imminent collapse. Such certification requires that the State collect 
scientific or technical information relative to the structure and its 
site and provide such information to the insured to be filed with a 
claim for insurance benefits under Section 1306 of the National Flood 
Insurance Act of 1968, as amended. The information which is provided to 
the insured shall include, but is not limited to, the following:
    (a) Certification from the State agency that the structure is 
subject to imminent collapse. The certification shall cite the property 
address, legal description (e.g., lot, block), the date of application 
for certification, and the date of and basis for the certification, and
    (b) Supporting scientific and technical data to substantiate the 
certification consisting of the following:
    (1) Photographs of the structure in relation to the obvious peril. 
All photographs should be labeled with the location, direction, date and 
time from which they were taken. The collection of photographs should 
adequately display the following:
    (i) Any evidence of existing damage. The damage can include loss or 
erosion of soil near or around the foundation, or structural damage to 
the foundation components.
    (ii) Structure and waterbody. These photographs shall show both the 
structure and the waterbody that presents

[[Page 325]]

the peril. If the structure is on a high bluff or dune and not 
accessible from the water side, the top edge of the bluff or dune will 
be sufficient. These will usually be taken from one or both sides of the 
structure.
    (iii) Physical reference features used in the measurements discussed 
below. The reference feature shall be in or near the area affected by 
normal tides, when applicable. If a reference is not clearly 
distinguishable on the photograph, it should be annotated to identify 
the feature. If possible, all reference features described below should 
be photographed showing their relationship to the site of the threatened 
structure.
    (2) Identification and selection of reference features. The 
following reference features are presented according to priority. If the 
first feature is not present, the next feature shall be located and 
photographed, and so forth.
    (i) Top edge of bluff (cliff top).
    (ii) Top edge of escarpment on an eroding dune (i.e., a nearly 
vertical erosional cut at the seaward face of the dune). The normal high 
tide should be near the toe of the dune and there should be indications 
that the dune is actively eroding.
    (iii) The normal high tide limit may be indicated by one of the 
following:
    (A) Vegetation line (the seaward most edge of permanent vegetation).
    (B) Beach scarp (erosion line on beach, usually a sharp, nearly 
vertical drop of 0.5 to 3.0 feet at the upper limit of high tide).
    (C) Debris line deposited by the normal high tide, not by a recent 
storm.
    (D) Upper limit of wet sand.
    (3) Distance measurements from the threatened structure to the 
nearest points on the reference features. These measurements should be 
taken from all photographed reference features to the closest point on 
the supporting foundation. For purposes of making this measurement, 
decks, stairs, and other exterior attachments that do not contribute to 
the structural support of the building are not considered part of the 
structure. The measurements shall be taken horizontally with a tape and 
recorded to the nearest foot. The date and time of the measurement shall 
be noted. The location of the measurements (i.e., reference feature and 
closest structural member) shall be identified on the appropriate 
photograph or sketch of the site. If some or all of the reference 
features coincide, this shall also be noted and identified on the 
photographs. Reference features landward of the structure need not be 
measured, but shall be noted on the photographs.
    (4) A determination of the average annual erosion rate at the site 
and a copy of the pertinent section of the reference document used to 
obtain the annual erosion rate at the site.
    (5) Copy of the effective Flood Insurance Rate Map panel annotated 
with the location of the threatened structure.
    (6) In the event that a structure is not situated within a ``zone of 
imminent collapse'' using the criteria and procedures in paragraphs (b) 
(1) through (5) of this section, then the State may submit other 
scientific and technical data, in addition to the information described 
in paragraphs (b) (1) through (5) of this section, that would reveal 
unusual erosive or stability conditions at the site. Such data must 
include engineering analyses or reports performed on the structure or 
site which evaluates local rates of erosion, or the condition or 
stability of the structure's foundation including supporting soil.
    (c) In the case of structures planned to be relocated, a 
certification as to whether the proposed relocation site is outside the 
30-year setback for 1-4 family residential structures, or outside the 
60-year setback for all other structures, must also be submitted by the 
State.

[53 FR 36975, Sept. 23, 1988, as amended at 53 FR 44193, Nov. 2, 1988]



Sec. 63.18  Review of State certification by the Administrator.

    The Administrator, after a claim has been filed by the property 
owner, will review the certification and data prepared by the State. 
Upon completion of the review, the State will be notified that:
    (a) The structure has been determined to be subject to imminent 
collapse, or

[[Page 326]]

    (b) The structure has not been determined to be subject to imminent 
collapse and the basis for such determination, or
    (c) Additional data are needed to verify that the procedures and 
criteria for imminent collapse certification have been met.



PART 64--COMMUNITIES ELIGIBLE FOR THE SALE OF INSURANCE--Table of Contents




Sec.
64.1  Purpose of part.
64.2  Definitions.
64.3  Flood Insurance Maps.
64.4  Effect on community eligibility resulting from boundary changes, 
          governmental reorganization, etc.
64.5  Relationship of rates to zone designations.
64.6  List of eligible communities.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 376.



Sec. 64.1  Purpose of part.

    (a) 42 U.S.C. 4012(c), 4022 and 4102 require that flood insurance in 
the maximum limits of coverage under the regular program shall be 
offered in communities only after the Administrator has: (1) Identified 
the areas of special flood, mudslide (i.e., mudflow) or flood-related 
erosion hazards within the community; and/or (2) completed a risk study 
for the applicant community. The priorities for conducting such risk 
studies are set forth in Secs. 59.23 and 60.25 of this subchapter. The 
purpose of this part is to define the types of zones which the Agency 
will use for identifying the hazard areas on maps.
    (b) 42 U.S.C. 4056 authorizes an emergency implementation of the 
National Flood Insurance Program whereby the Administrator may make 
subsidized coverage available to eligible communities prior to the 
completion of detailed risk studies for such areas. This part also 
describes procedures under the emergency program and lists communities 
which become eligible under the NFIP.

[48 FR 28278, June 21, 1983, as amended at 49 FR 4751, Feb. 8, 1984; 49 
FR 33879, Aug. 27, 1984]



Sec. 64.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.

[41 FR 46986, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 64.3  Flood Insurance Maps.

    (a) The following maps may be prepared by the Administrator for use 
in connection with the sale of flood insurance:
    (1) Flood Insurance Rate Map (FIRM): This map is prepared after the 
risk study for the community has been completed and the risk premium 
rates have been established. It indicates the risk premium rate zones 
applicable in the community and when those rates are effective. The 
symbols used to designate those zones are as follows:

                                                                        
------------------------------------------------------------------------
               Zone symbol                                              
------------------------------------------------------------------------
A.......................................  Area of special flood hazard  
                                           without water surface        
                                           elevations determined.       
A1-30, AE...............................  Area of special flood hazard  
                                           with water surface elevations
                                           determined.                  
A0......................................  Area of special flood hazards 
                                           having shallow water depths  
                                           and/or unpredictable flow    
                                           paths between (1) and (3) ft.
A99.....................................  Area of special flood hazard  
                                           where enough progress has    
                                           been made on a protective    
                                           system, such as dikes, dams, 
                                           and levees, to consider it   
                                           complete for insurance rating
                                           purposes.                    
AH......................................  Areas of special flood hazards
                                           having shallow water depths  
                                           and/or unpredictable flow    
                                           paths between (1) and (3)    
                                           feet, and with water surface 
                                           elevations determined.       
AR......................................  Area of special flood hazard  
                                           that results from the        
                                           decertification of a         
                                           previously accredited flood  
                                           protection system that is    
                                           determined to be in the      
                                           process of being restored to 
                                           provide a 100-year or greater
                                           level of flood protection.   
V.......................................  Area of special flood hazards 
                                           without water surface        
                                           elevations determined, and   
                                           with velocity, that is       
                                           inundated by tidal floods    
                                           (coastal high hazard area).  
V1-30, VE...............................  Area of special flood hazards,
                                           with water surface elevations
                                           determined and with velocity,
                                           that is inundated by tidal   
                                           floods (coastal high hazard  
                                           area).                       
V0......................................  Area of special flood hazards 
                                           having shallow water depths  
                                           and/or unpredictable flow    
                                           paths between (1) and (3) ft.
                                           and with velocity.           
B, X....................................  Area of moderate flood        
                                           hazards.                     
C, X....................................  Area of minimal hazards.      
D.......................................  Area of undetermined but      
                                           possible, flood hazards.     
M.......................................  Area of special mudslide      
                                           (i.e., mudflow) hazards.     
N.......................................  Area of moderate mudslide     
                                           (i.e., mudflow) hazards.     

[[Page 327]]

                                                                        
P.......................................  Area of undetermined, but     
                                           possible, mudslide hazards.  
E.......................................  Area of special flood-related 
                                           erosion hazards.             
------------------------------------------------------------------------


Areas identified as subject to more than one hazard (flood, mudslide 
(i.e., mudflow), flood-related erosion) will be designated by use of the 
proper symbols in combination.
    (2) Flood Hazard Boundary Map (FHBM). This map is issued by the 
Administrator delineating Zones A, M, and E within a community.
    (b) Notice of the issuance of new or revised FHBMs or Flood 
Insurance Rate Maps is given in part 65 of this subchapter. The 
mandatory purchase of insurance is required within designated Zones A, 
A1-30, AE, A99, AO, AH, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, V1-30, 
VE, V, VO, M, and E.
    (c) The FHBM or FIRM shall be maintained for public inspection at 
the following locations:
    (1) The information office of the State agency or agencies 
designated by statute or the respective Governors to cooperate with the 
Administrator in implementing the Program whenever a community becomes 
eligible for Program participation and the sale of insurance pursuant to 
this section or is identified as flood prone.
    (2) One or more official locations within the community in which 
flood insurance is offered.
    (3) [Reserved]
    (4) The official record copy of each official map shall be 
maintained in FEMA files in Washington, DC.

[41 FR 46986, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 46 FR 1274, Jan. 6, 1981; 48 FR 28278, June 21, 1983; 48 
FR 44544 and 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 50 FR 
36028, Sept. 4, 1985; 59 FR 53599, Oct. 25, 1994]



Sec. 64.4  Effect on community eligibility resulting from boundary changes, governmental reorganization, etc.

    (a) When a community not participating in the Program acquires by 
means of annexation, incorporation, or otherwise, an area within another 
community participating in the Program, no new flood insurance shall be 
made available as of the effective date of annexation until the newly 
acquiring community participates in the Program. Until the effective 
date of participation, existing flood insurance policies remain in 
effect until the policy's date of expiration, but shall not be renewed.
    (b) When a community participating in the Program acquires by means 
of annexation, incorporation, or otherwise, another area which was 
previously located in a community either participating or not 
participating in the Program, the community shall have six months from 
the date of acquisition to formally amend its flood plain management 
regulations in order to include all flood-prone areas within the newly 
acquired area. The amended regulations shall satisfy the applicable 
requirements in Sec. 60.3 of this subchapter based on the data 
previously provided by the Administrator. In the event that the newly 
acquired area was previously located in a community participating in the 
Program, the provisions of this section shall only apply if the 
community, upon acquisition, and pending formal adoption of the 
amendment to its flood plain management regulations, certifies in 
writing over the signature of a community official that within the newly 
acquired area the flood plain management requirements previously 
applicable in the area remain in force. In the event that the newly-
acquired area was previously located in a community not participating in 
the Program, the provisions of the section shall only apply if the 
community, upon acquisition, and pending formal adoption of the 
amendments to its flood plain management regulations, certifies in 
writing over the signature of a community official that it shall enforce 
within the newly-month period, existing flood insurance policies shall 
remain in effect until their date of expiration may be renewed, and new 
policies may be issued. Failure to satisfy the applicable requirements 
in Sec. 60.3 shall result in the community's suspension from Program 
participation pursuant to Sec. 59.24 of this subchapter.
    (c) When an area previously a part of a community participating in 
the Program becomes autonomous or becomes a portion of a newly 
autonomous community resulting from boundary

[[Page 328]]

changes, governmental reorganization, changes in state statutes or 
constitution, or otherwise, such new community shall be given six months 
from the date of its independence, to adopt flood plain management 
regulations within the special hazard areas subject to its jurisdiction 
and to submit its application for participation as a separate community 
in order to retain eligibility for the sale of flood insurance. The 
regulations adopted by such new community shall satisfy the applicable 
requirements in Sec. 60.3 of this subchapter based on the data 
previously provided by the Administrator. The provisions of this section 
shall only apply where the new community upon the date of its 
independence certifies in writing over the signature of a community 
official that, pending formal adoption of flood plain management 
regulations, the flood plain management requirements previously 
applicable in that area remain in effect. During the six month period, 
existing flood insurance policies shall remain in effect until their 
dates of expiration may be renewed, and new policies may be issued. 
Failure to satisfy the applicable requirements in Sec. 60.3 of this 
subchapter shall result in the community's suspension from Program 
participation pursuant to Sec. 59.24 of this subchapter.
    (d) Where any community or any area within a community had in effect 
a FHBM or FIRM, but all or a portion of that community has been acquired 
by another community, or becomes autonomous, that map shall remain in 
effect until it is superseded by the Administrator, whether by 
republication as part of the map of the acquiring community, or 
otherwise.
    (e) When a community described in paragraph (a), (b), (c), or (d) of 
this section has flood elevations in effect, no new appeal period under 
parts 66, 67, and 68 of this subchapter will begin except as new 
scientific and technical data are available.

[41 FR 46986, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 64.5  Relationship of rates to zone designations.

    (a) In order to expedite a community's qualification for flood 
insurance under the emergency program, the Administrator may authorize 
the sale of such insurance without designating any Zones A, M, or E 
within a community, provided the community has previously adopted flood 
plain management regulations meeting the requirements of Sec. 60.3(a), 
Sec. 60.4(a) or Sec. 60.5(a) of this subchapter. When the Administrator 
has obtained sufficient technical information to delineate Zones A, M, 
or E, he/she shall delineate the tentative boundaries on a FHBM.
    (b) Upon the effective date of the FIRM, flood insurance will 
continue to be available throughout the entire community at chargeable 
rates (i.e., subsidized) for first layer coverage of existing 
structures, but will be only available at risk premium rates for all new 
construction and substantial improvements. Upon the effective date of a 
FIRM, second layer coverage is available only at risk premium rates for 
all structures.
    (c) Detailed insurance information may be obtained from the 
servicing companies. See part 62 of this subchapter.

[41 FR 46986, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44552, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 64.6  List of eligible communities.

    The sale of flood insurance pursuant to the National Flood Insurance 
Program (42 U.S.C. 4001-4128) is authorized for the communities set 
forth under this section. Previous listings under this part continue in 
effect until revised.

[41 FR 46986, Oct. 25, 1976]

    Editorial Note: For references to FR pages showing lists of eligible 
communities, see the List of CFR Sections Affected appearing in the 
Finding Aids section of this volume.



PART 65--IDENTIFICATION AND MAPPING OF SPECIAL HAZARD AREAS--Table of Contents




Sec.

[[Page 329]]

65.1  Purpose of part.
65.2  Definitions.
65.3  Requirement to submit new technical data.
65.4  Right to submit new technical data.
65.5  Revision to special flood hazard area boundaries with no change to 
          base flood elevation determinations.
65.6  Revision of base flood elevation determinations.
65.7  Floodway revisions.
65.8  Review of proposed projects.
65.9  Review and response by the Administrator.
65.10  Mapping of areas protected by levee systems.
65.11  Evaluation of sand dunes in mapping coastal flood hazard areas.
65.12  Revision of flood insurance rate maps to reflect base flood 
          elevations caused by proposed encroachments.
65.13  Mapping and map revisions for areas subject to alluvial fan 
          flooding.
65.14  Remapping of areas for which local flood protection systems no 
          longer provide 100-year flood protection.
65.15  List of communities submitting new technical data.
65.16  Standard Flood Hazard Determination Form and instructions.
Sec. 65.17  Review of determinations.

Appendix A to Part 65--Federal Emergency Management Agency, Standard 
          Flood Hazard Determination Form and Instructions

    Authority: 42 U.S.C. 4001 et seq., Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127 of Mar. 31, 
1979, 44 FR 19367, 3 CFR, 1979 Comp., p. 376.



Sec. 65.1  Purpose of part.

    42 U.S.C. 4104 authorizes the Director to identify and publish 
information with respect to all areas within the United States having 
special flood, mudslide (i.e., mudflow) and flood-related erosion 
hazards. The purpose of this part is to outline the steps a community 
needs to take in order to assist the Agency's effort in providing up-to-
date identification and publication, in the form of the maps described 
in part 64, on special flood, mudslide (i.e., mudflow) and flood-related 
erosion hazards.

[48 FR 28278, June 21, 1983]



Sec. 65.2  Definitions.

    (a) Except as otherwise provided in this part, the definitions set 
forth in part 59 of this subchapter are applicable to this part.
    (b) For the purpose of this part, a certification by a registered 
professional engineer or other party does not constitute a warranty or 
guarantee of performance, expressed or implied. Certification of data is 
a statement that the data is accurate to the best of the certifier's 
knowledge. Certification of analyses is a statement that the analyses 
have been performed correctly and in accordance with sound engineering 
practices. Certification of structural works is a statement that the 
works are designed in accordance with sound engineering practices to 
provide protection from the base flood. Certification of ``as built'' 
conditions is a statement that the structure(s) has been built according 
to the plans being certified, is in place, and is fully functioning.

[51 FR 30313, Aug. 25, 1986]



Sec. 65.3  Requirement to submit new technical data.

    A community's base flood elevations may increase or decrease 
resulting from physical changes affecting flooding conditions. As soon 
as practicable, but not later than six months after the date such 
information becomes available, a community shall notify the 
Administrator of the changes by submitting technical or scientific data 
in accordance with this part. Such a submission is necessary so that 
upon confirmation of those physical changes affecting flooding 
conditions, risk premium rates and flood plain management requirements 
will be based upon current data.

[51 FR 30313, Aug. 25, 1986]



Sec. 65.4  Right to submit new technical data.

    (a) A community has a right to request changes to any of the 
information shown on an effective map that does not impact flood plain 
or floodway delineations or base flood elevations, such as community 
boundary changes, labeling, or planimetric details. Such a submission 
shall include appropriate supporting documentation in accordance with 
this part and may be submitted at any time.
    (b) All requests for changes to effective maps, other than those 
initiated

[[Page 330]]

by FEMA, must be made in writing by the Chief Executive Officer of the 
community (CEO) or an official designated by the CEO. Should the CEO 
refuse to submit such a request on behalf of another party, FEMA will 
agree to review it only if written evidence is provided indicating the 
CEO or designee has been requested to do so.
    (c) Requests for changes to effective Flood Insurance Rate Maps 
(FIRMs) and Flood Boundary and Floodway Maps (FBFMs) are subject to the 
cost recovery procedures described in 44 CFR part 72. As indicated in 
part 72, revisions requested to correct mapping errors or errors in the 
Flood Insurance Study analysis are not to be subject to the cost-
recovery procedures.

[51 FR 30313, Aug. 25, 1986, as amended at 57 FR 29038, June 30, 1992; 
61 FR 46331, Aug. 30, 1996; 62 FR 5736, Feb. 6, 1997]

    Editorial Note: For references to FR pages showing lists of eligible 
communities, see the List of CFR Sections Affected appearing in the 
Finding Aids section of this volume.



Sec. 65.5  Revision to special flood hazard area boundaries with no change to base flood elevation determinations.

    (a) Data requirements for topographic changes. In many areas of 
special flood hazard (excluding V zones and floodways) it may be 
feasible to elevate areas with earth fill above the base flood 
elevation. Scientific and technical information to support a request to 
gain exclusion from an area of special flood hazard of a structure or 
parcel of land that has been elevated by the placement of fill shall 
include the following:
    (1) A copy of the recorded deed indicating the legal description of 
the property and the official recordation information (deed book volume 
and page number) and bearing the seal of the appropriate recordation 
official (e.g., County Clerk or Recorder of Deeds).
    (2) If the property is recorded on a plat map, a copy of the 
recorded plat indicating both the location of the property and the 
official recordation information (plat book volume and page number) and 
bearing the seal of the appropriate recordation official. If the 
property is not recorded on a plat map, copies of the tax map or other 
suitable maps are required to aid FEMA in accurately locating the 
property.
    (3) If a legally defined parcel of land is involved, a topographic 
map indicating present ground elevations and date of fill. FEMA's 
determination as to whether a legally defined parcel of land is to be 
excluded from the area of special flood hazard shall be based upon a 
comparison of the ground elevations of the parcel with the elevations of 
the base flood. If the ground elevations of the entire legally defined 
parcel of land are at or above the elevations of the base flood, the 
parcel may be excluded from the area of special flood hazard.
    (4) If a structure is involved, a topographic map indicating 
structure location and ground elevations including the elevations of the 
lowest floor (including basement) and the lowest adjacent grade to the 
structure. FEMA's determination as to whether a structure is to be 
excluded from the area of special flood hazard shall be based upon a 
comparison of the elevation of the lowest floor (including basement) and 
the elevation of the lowest adjacent grade with the elevation of the 
base flood. If the entire structure and the lowest adjacent grade are at 
or above the elevation of the base flood, the structure may be excluded 
from the area of special flood hazard.
    (5) Data to substantiate the base flood elevation. If FEMA has 
completed a Flood Insurance Study (FIS), that data will be used to 
substantiate the base flood. Otherwise, data provided by an 
authoritative source, such as the U.S. Army Corps of Engineers, U.S. 
Geological Survey, U.S. Soil Conservation Service, state and local water 
resource departments, or technical data prepared and certified by a 
registered professional engineer may be submitted. If base flood 
elevations have not previously been established, hydraulic calculations 
may also be requested.
    (6) Where fill has been placed to raise the ground surface to or 
above the base flood elevation and the request to gain exclusion from an 
area of special flood hazard includes more than a single structure or a 
single lot, it must be

[[Page 331]]

demonstrated that fill will not settle below the elevation of the base 
flood, and that the fill is adequately protected from the forces of 
erosion, scour, or differential settlement as described below:
    (i) Fill must be compacted to 95 percent of the maximum density 
obtainable with the Standard Proctor Test method issued by the American 
Society for Testing and Materials (ASTM Standard D-698). This 
requirement applies to fill pads prepared for residential or commercial 
structure foundations and does not apply to filled areas intended for 
other uses.
    (ii) Fill slopes for granular materials are not steeper than one 
vertical on one-and-one-half horizontal unless substantiating data 
justifying steeper slopes is submitted.
    (iii) Adequate protection is provided fill slopes exposed to flood 
waters with expected velocities during the occurrence of the base flood 
of five feet per second or less by covering them with grass, vines, 
weeds, or similar vegetation undergrowth.
    (iv) Adequate protection is provided fill slopes exposed to flood 
waters with velocities during the occurrence of the base flood of 
greater than five feet per second by armoring them with stone or rock 
slope protection.
    (7) A revision of flood plain delineations based on fill must 
demonstrate that any such fill has not resulted in a floodway 
encroachment.
    (b) New topographic data. The procedures described in paragraphs (a) 
(1) through (5) of this section may be also followed to request a map 
revision when no physical changes have occurred in the area of special 
flood hazard, when no fill has been placed, and when the natural ground 
elevations, as evidenced by new topographic maps, more detailed or more 
accurate than those used to prepare the map to be revised, are shown to 
be above the elevation of the base flood.
    (c) Certification requirements. The items required in paragraphs (a) 
(3) and (4) and (b) of this section shall be certified by a registered 
professional engineer or licensed land surveyor. Items required in 
paragraph (a)(6) of this section shall be certified by the community's 
NFIP permit official, a registered professional engineer, or an 
accredited soils engineer. Such certifications are subject to the 
provisions of Sec. 65.2 of this subchapter.
    (d) Submission procedures. All requests shall be submitted to the 
FEMA Regional Office servicing the community's geographic area or to the 
FEMA Headquarters Office in Washington, DC, and shall be accompanied by 
the appropriate payment, in accordance with 44 CFR part 72.

[51 FR 30313, Aug. 25, 1986; as amended at 61 FR 46331, Aug. 30, 1996; 
62 FR 5736, Feb. 6, 1997]



Sec. 65.6  Revision of base flood elevation determinations.

    (a) General conditions and data requirements. (1) The supporting 
data must include all the information FEMA needs to review and evaluate 
the request. This may involve the requestor's performing new hydrologic 
and hydraulic analysis and delineation of new flood plain boundaries and 
floodways, as necessary.
    (2) To avoid discontinuities between the revised and unrevised flood 
data, the necessary hydrologic and hydraulic analyses submitted by the 
map revision requestor must be extensive enough to ensure that a logical 
transition can be shown between the revised flood elevations, flood 
plain boundaries, and floodways and those developed previously for areas 
not affected by the revision. Unless it is demonstrated that it would 
not be appropriate, the revised and unrevised base flood elevations must 
match within one-half foot where such transitions occur.
    (3) Revisions cannot be made based on the effects of proposed 
projects or future conditions. Section 65.8 of this subchapter contains 
provisions for obtaining conditional approval of proposed projects that 
may effect map changes when they are completed.
    (4) The datum and date of releveling of benchmarks, if any, to which 
the elevations are referenced must be indicated.
    (5) Maps will not be revised when discharges change as a result of 
the use of an alternative methodology or data for computing flood 
discharges unless the change is statistically significant as

[[Page 332]]

measured by a confidence limits analysis of the new discharge estimates.
    (6) Any computer program used to perform hydrologic or hydraulic 
analyses in support of a flood insurance map revision must meet all of 
the following criteria:
    (i) It must have been reviewed and accepted by a governmental agency 
responsible for the implementation of programs for flood control and/or 
the regulation of flood plain lands. For computer programs adopted by 
non-Federal agencies, certification by a responsible agency official 
must be provided which states that the program has been reviewed, 
tested, and accepted by that agency for purposes of design of flood 
control structures or flood plain land use regulation.
    (ii) It must be well-documented including source codes and user's 
manuals.
    (iii) It must be available to FEMA and all present and future 
parties impacted by flood insurance mapping developed or amended through 
the use of the program. For programs not generally available from a 
Federal agency, the source code and user's manuals must be sent to FEMA 
free of charge, with fully-documented permission from the owner that 
FEMA may release the code and user's manuals to such impacted parties.
    (7) A revised hydrologic analysis for flooding sources with 
established base flood elevations must include evaluation of the same 
recurrence interval(s) studied in the effective FIS, such as the 10-, 
50-, 100-, and 500-year flood discharges.
    (8) A revised hydraulic analysis for a flooding source with 
established base flood elevations must include evaluation of the same 
recurrence interval(s) studied in the effective FIS, such as the 10-, 
50-, 100-, and 500-year flood elevations, and of the floodway. Unless 
the basis of the request is the use of an alternative hydraulic 
methodology or the requestor can demonstrate that the data of the 
original hydraulic computer model is unavailable or its use is 
inappropriate, the analysis shall be made using the same hydraulic 
computer model used to develop the base flood elevations shown on the 
effective Flood Insurance Rate Map and updated to show present 
conditions in the flood plain. Copies of the input and output data from 
the original and revised hydraulic analyses shall be submitted.
    (9) A hydrologic or hydraulic analysis for a flooding source without 
established base flood elevations may be performed for only the 100-year 
flood.
    (10) A revision of flood plain delineations based on topographic 
changes must demonstrate that any topographic changes have not resulted 
in a floodway encroachment.
    (11) Delineations of flood plain boundaries for a flooding source 
with established base flood elevations must provide both the 100- and 
500-year flood plain boundaries. For flooding sources without 
established base flood elevations, only 100-year flood plain boundaries 
need be submitted. These boundaries should be shown on a topographic map 
of suitable scale and contour interval.
    (12) If a community or other party seeks recognition from FEMA, on 
its FHBM or FIRM, that an altered or relocated portion of a watercourse 
provides protection from, or mitigates potential hazards of, the base 
flood, the Administrator may request specific documentation from the 
community certifying that, and describing how, the provisions of 
Sec. 60.3(b)(7) of this subchapter will be met for the particular 
watercourse involved. This documentation, which may be in the form of a 
written statement from the Community Chief Executive Officer, an 
ordinance, or other legislative action, shall describe the nature of the 
maintenance activities to be performed, the frequency with which they 
will be performed, and the title of the local community official who 
will be responsible for assuring that the maintenance activities are 
accomplished.
    (13) Notwithstanding any other provisions of Sec. 65.6, a community 
may submit, in lieu of the documentation specified in Sec. 65.6(a)(12), 
certification by a registered professional engineer that the project has 
been designed to retain its flood carrying capacity without periodic 
maintenance.
    (b) Data requirements for correcting map errors. To correct errors 
in the original flood analysis, technical data

[[Page 333]]

submissions shall include the following:
    (1) Data identifying mathematical errors.
    (2) Data identifying measurement errors and providing correct 
measurements.
    (c) Data requirements for changed physical conditions. Revisions 
based on the effects of physical changes that have occurred in the flood 
plain shall include:
    (1) Changes affecting hydrologic conditions. The following data must 
be submitted:
    (i) General description of the changes (e.g., dam, diversion 
channel, or detention basin).
    (ii) Construction plans for as-built conditions, if applicable.
    (iii) New hydrologic analysis accounting for the effects of the 
changes.
    (iv) New hydraulic analysis and profiles using the new flood 
discharge values resulting from the hydrologic analysis.
    (v) Revised delineations of the flood plain boundaries and floodway.
    (2) Changes affecting hydraulic conditions. The following data shall 
be submitted:
    (i) General description of the changes (e.g., channelization or new 
bridge, culvert, or levee).
    (ii) Construction plans for as-built conditions.
    (iii) New hydraulic analysis and flood elevation profiles accounting 
for the effects of the changes and using the original flood discharge 
values upon which the original map is based.
    (iv) Revised delineations of the flood plain boundaries and 
floodway.
    (3) Changes involving topographic conditions. The following data 
shall be submitted:
    (i) General description of the changes (e.g., grading or filling).
    (ii) New topographic information, such as spot elevations, cross 
sections grading plans, or contour maps.
    (iii) Revised delineations of the flood plain boundaries and, if 
necessary, floodway.
    (d) Data requirements for incorporating improved data. Requests for 
revisions based on the use of improved hydrologic, hydraulic, or 
topographic data shall include the following data:
    (1) Data that are believed to be better than those used in the 
original analysis (such as additional years of stream gage data).
    (2) Documentation of the source of the data.
    (3) Explanation as to why the use of the new data will improve the 
results of the original analysis.
    (4) Revised hydrologic analysis where hydrologic data are being 
incorporated.
    (5) Revised hydraulic analysis and flood elevation profiles where 
new hydrologic or hydraulic data are being incorporated.
    (6) Revised delineations of the flood plain boundaries and floodway 
where new hydrologic, hydraulic, or topographic data are being 
incorporated.
    (e) Data requirements for incorporating improved methods. Requests 
for revisions based on the use of improved hydrologic or hydraulic 
methodology shall include the following data:
    (1) New hydrologic analysis when an alternative hydrologic 
methodology is being proposed.
    (2) New hydraulic analysis and flood elevation profiles when an 
alternative hyrologic or hydraulic methodology is being proposed.
    (3) Explanation as to why the alternative methodologies are superior 
to the original methodologies.
    (4) Revised delineations of the flood plain boundaries and floodway 
based on the new analysis(es).
    (f) Certification requirements. All analysis and data submitted by 
the requester shall be certified by a registered professional engineer 
or licensed land surveyor, as appropriate, subject to the definition of 
``certification'' given at Sec. 65.2 of this subchapter.
    (g) Submission procedures. All requests shall be submitted to the 
FEMA Regional Office servicing the community's geographic area or to the 
FEMA Headquarters Office in Washington, DC, and shall be accompanied by 
the appropriate payment, in accordance with 44 CFR part 72.

[51 FR 30314, Aug. 25, 1986, as amended at 53 FR 16279, May 6, 1988; 54 
FR 33550, Aug. 15, 1989; 61 FR 46331, Aug. 30, 1996; 62 FR 5736, Feb. 6, 
1997]

[[Page 334]]



Sec. 65.7  Floodway revisions.

    (a) General. Floodway data is developed as part of FEMA Flood 
Insurance Studies and is utilized by communities to select and adopt 
floodways as part of the flood plain management program required by 
Sec. 60.3 of this subchapter. When it has been determined by a community 
that no practicable alternatives exist to revising the boundaries of its 
previously adopted floodway, the procedures below shall be followed.
    (b) Data requirements when base flood elevation changes are 
requested. When a floodway revision is requested in association with a 
change to base flood elevations, the data requirements of Sec. 65.6 
shall also be applicable. In addition, the following documentation shall 
be submitted:
    (1) Copy of a public notice distributed by the community stating the 
community's intent to revise the floodway or a statement by the 
community that it has notified all affected property owners and affected 
adjacent jurisdictions.
    (2) Copy of a letter notifying the appropriate State agency of the 
floodway revision when the State has jurisdiction over the floodway or 
its adoption by communities participating in the NFIP.
    (3) Documentation of the approval of the revised floodway by the 
appropriate State agency (for communities where the State has 
jurisdiction over the floodway or its adoption by communities 
participating in the NFIP).
    (4) Engineering analysis for the revised floodway, as described 
below:
    (i) The floodway analysis must be performed using the hydraulic 
computer model used to determine the proposed base flood elevations.
    (ii) The floodway limits must be set so that neither the effective 
base flood elevations nor the proposed base flood elevations if less 
than the effective base flood elevations, are increased by more than the 
amount specified under Sec. 60.3 (d)(2). Copies of the input and output 
data from the original and modified computer models must be submitted.
    (5) Delineation of the revised floodway on the same topographic map 
used for the delineation of the revised flood boundaries.
    (c) Data requirements for changes not associated with base flood 
elevation changes. The following data shall be submitted:
    (1) Items described in paragraphs (b) (1) through (3) of this 
section must be submitted.
    (2) Engineering analysis for the revised floodway, as described 
below:
    (i) The original hydraulic computer model used to develop the 
established base flood elevations must be modified to include all 
encroachments that have occurred in the flood plain since the existing 
floodway was developed. If the original hydraulic computer model is not 
available, an alternate hydraulic computer model may be used provided 
the alternate model has been calibrated so as to reproduce the original 
water surface profile of the original hydraulic computer model. The 
alternate model must be then modified to include all encroachments that 
have occurred since the existing floodway was developed.
    (ii) The floodway analysis must be performed with the modified 
computer model using the desired floodway limits.
    (iii) The floodway limits must be set so that combined effects of 
the past encroachments and the new floodway limits do not increase the 
effective base flood elevations by more than the amount specified in 
Sec. 60.3(d)(2). Copies of the input and output data from the original 
and modified computer models must be submitted.
    (3) Delineation of the revised floodway on a copy of the effective 
NFIP map and a suitable topographic map.
    (d) Certification requirements. All analyses submitted shall be 
certified by a registered professional engineer. All topographic data 
shall be certified by a registered professional engineer or licensed 
land surveyor. Certifications are subject to the definition given at 
Sec. 65.2 of this subchapter.
    (e) Submission procedures. All requests that involve changes to 
floodways shall be submitted to the appropriate FEMA Regional Office 
servicing the community's geographic area.

[51 FR 30315, Aug. 25, 1986]

[[Page 335]]



Sec. 65.8  Review of proposed projects.

    A community, or an individual through the community, may request 
FEMA's comments on whether a proposed project, if built as proposed, 
would justify a map revision. FEMA's comments will be issued in the form 
of a letter, termed a Conditional Letter of Map Revision, in accordance 
with 44 CFR part 72. The data required to support such requests are the 
same as those required for final revisions under Secs. 65.5, 65.6, and 
65.7, except as-built certification is not required. All such requests 
shall be submitted to the FEMA Headquarters Office in Washington, DC, 
and shall be accompanied by the appropriate payment, in accordance with 
44 CFR part 72.

[62 FR 5736, Feb. 6, 1997]



Sec. 65.9  Review and response by the Administrator.

    If any questions or problems arise during review, FEMA will consult 
the Chief Executive Officer of the community (CEO), the community 
official designated by the CEO, and/or the requester for resolution. 
Upon receipt of a revision request, the Administrator shall mail an 
acknowledgment of receipt of such request to the CEO. Within 90 days of 
receiving the request with all necessary information, the Administrator 
shall notify the CEO of one or more of the following:
    (a) The effective map(s) shall not be modified;
    (b) The base flood elevations on the effective FIRM shall be 
modified and new base flood elevations shall be established under the 
provisions of part 67 of this subchapter;
    (c) The changes requested are approved and the map(s) amended by 
Letter of Map Revision (LOMR);
    (d) The changes requested are approved and a revised map(s) will be 
printed and distributed;
    (e) The changes requested are not of such a significant nature as to 
warrant a reissuance or revision of the flood insurance study or maps 
and will be deferred until such time as a significant change occurs;
    (f) An additional 90 days is required to evaluate the scientific or 
technical data submitted; or
    (g) Additional data are required to support the revision request.
    (h) The required payment has not been submitted in accordance with 
44 CFR part 72, no review will be conducted and no determination will be 
issued until payment is received.

[51 FR 30315, Aug. 25, 1986; 61 FR 46331, Aug. 30, 1996, as amended at 
62 FR 5736, Feb. 6, 1997]



Sec. 65.10  Mapping of areas protected by levee systems.

    (a) General. For purposes of the NFIP, FEMA will only recognize in 
its flood hazard and risk mapping effort those levee systems that meet, 
and continue to meet, minimum design, operation, and maintenance 
standards that are consistent with the level of protection sought 
through the comprehensive flood plain management criteria established by 
Sec. 60.3 of this subchapter. Accordingly, this section describes the 
types of information FEMA needs to recognize, on NFIP maps, that a levee 
system provides protection from the base flood. This information must be 
supplied to FEMA by the community or other party seeking recognition of 
such a levee system at the time a flood risk study or restudy is 
conducted, when a map revision under the provisions of part 65 of this 
subchapter is sought based on a levee system, and upon request by the 
Administrator during the review of previously recognized structures. The 
FEMA review will be for the sole purpose of establishing appropriate 
risk zone determinations for NFIP maps and shall not constitute a 
determination by FEMA as to how a structure or system will perform in a 
flood event.
    (b) Design criteria. For levees to be recognized by FEMA, evidence 
that adequate design and operation and maintenance systems are in place 
to provide reasonable assurance that protection from the base flood 
exists must be provided. The following requirements must be met:
    (1) Freeboard. (i) Riverine levees must provide a minimum freeboard 
of three feet above the water-surface level of the base flood. An 
additional one foot above the minimum is required within 100 feet in 
either side of structures (such as bridges) riverward of the levee or 
wherever the flow is constricted. An

[[Page 336]]

additional one-half foot above the minimum at the upstream end of the 
levee, tapering to not less than the minimum at the downstream end of 
the levee, is also required.
    (ii) Occasionally, exceptions to the minimum riverine freeboard 
requirement described in paragraph (b)(1)(i) of this section, may be 
approved. Appropriate engineering analyses demonstrating adequate 
protection with a lesser freeboard must be submitted to support a 
request for such an exception. The material presented must evaluate the 
uncertainty in the estimated base flood elevation profile and include, 
but not necessarily be limited to an assessment of statistical 
confidence limits of the 100-year discharge; changes in stage-discharge 
relationships; and the sources, potential, and magnitude of debris, 
sediment, and ice accumulation. It must be also shown that the levee 
will remain structurally stable during the base flood when such 
additional loading considerations are imposed. Under no circumstances 
will freeboard of less than two feet be accepted.
    (iii) For coastal levees, the freeboard must be established at one 
foot above the height of the one percent wave or the maximum wave runup 
(whichever is greater) associated with the 100-year stillwater surge 
elevation at the site.
    (iv) Occasionally, exceptions to the minimum coastal levee freeboard 
requirement described in paragraph (b)(1)(iii) of this section, may be 
approved. Appropriate engineering analyses demonstrating adequate 
protection with a lesser freeboard must be submitted to support a 
request for such an exception. The material presented must evaluate the 
uncertainty in the estimated base flood loading conditions. Particular 
emphasis must be placed on the effects of wave attack and overtopping on 
the stability of the levee. Under no circumstances, however, will a 
freeboard of less than two feet above the 100-year stillwater surge 
elevation be accepted.
    (2) Closures. All openings must be provided with closure devices 
that are structural parts of the system during operation and design 
according to sound engineering practice.
    (3) Embankment protection. Engineering analyses must be submitted 
that demonstrate that no appreciable erosion of the levee embankment can 
be expected during the base flood, as a result of either currents or 
waves, and that anticipated erosion will not result in failure of the 
levee embankment or foundation directly or indirectly through reduction 
of the seepage path and subsequent instability. The factors to be 
addressed in such analyses include, but are not limited to: Expected 
flow velocities (especially in constricted areas); expected wind and 
wave action; ice loading; impact of debris; slope protection techniques; 
duration of flooding at various stages and velocities; embankment and 
foundation materials; levee alignment, bends, and transitions; and levee 
side slopes.
    (4) Embankment and foundation stability. Engineering analyses that 
evaluate levee embankment stability must be submitted. The analyses 
provided shall evaluate expected seepage during loading conditions 
associated with the base flood and shall demonstrate that seepage into 
or through the levee foundation and embankment will not jeopardize 
embankment or foundation stability. An alternative analysis 
demonstrating that the levee is designed and constructed for stability 
against loading conditions for Case IV as defined in the U.S. Army Corps 
of Engineers (COE) manual, ``Design and Construction of Levees'' (EM 
1110-2-1913, Chapter 6, Section II), may be used. The factors that shall 
be addressed in the analyses include: Depth of flooding, duration of 
flooding, embankment geometry and length of seepage path at critical 
locations, embankment and foundation materials, embankment compaction, 
penetrations, other design factors affecting seepage (such as drainage 
layers), and other design factors affecting embankment and foundation 
stability (such as berms).
    (5) Settlement. Engineering analyses must be submitted that assess 
the potential and magnitude of future losses of freeboard as a result of 
levee settlement and demonstrate that freeboard will be maintained 
within the minimum standards set forth in paragraph (b)(1) of this 
section. This analysis

[[Page 337]]

must address embankment loads, compressibility of embankment soils, 
compressibility of foundation soils, age of the levee system, and 
construction compaction methods. In addition, detailed settlement 
analysis using procedures such as those described in the COE manual, 
``Soil Mechanics Design--Settlement Analysis'' (EM 1100-2-1904) must be 
submitted.
    (6) Interior drainage. An analysis must be submitted that identifies 
the source(s) of such flooding, the extent of the flooded area, and, if 
the average depth is greater than one foot, the water-surface 
elevation(s) of the base flood. This analysis must be based on the joint 
probability of interior and exterior flooding and the capacity of 
facilities (such as drainage lines and pumps) for evacuating interior 
floodwaters.
    (7) Other design criteria. In unique situations, such as those where 
the levee system has relatively high vulnerability, FEMA may require 
that other design criteria and analyses be submitted to show that the 
levees provide adequate protection. In such situations, sound 
engineering practice will be the standard on which FEMA will base its 
determinations. FEMA will also provide the rationale for requiring this 
additional information.
    (c) Operation plans and criteria. For a levee system to be 
recognized, the operational criteria must be as described below. All 
closure devices or mechanical systems for internal drainage, whether 
manual or automatic, must be operated in accordance with an officially 
adopted operation manual, a copy of which must be provided to FEMA by 
the operator when levee or drainage system recognition is being sought 
or when the manual for a previously recognized system is revised in any 
manner. All operations must be under the jurisdiction of a Federal or 
State agency, an agency created by Federal or State law, or an agency of 
a community participating in the NFIP.
    (1) Closures. Operation plans for closures must include the 
following:
    (i) Documentation of the flood warning system, under the 
jurisdiction of Federal, State, or community officials, that will be 
used to trigger emergency operation activities and demonstration that 
sufficient flood warning time exists for the completed operation of all 
closure structures, including necessary sealing, before floodwaters 
reach the base of the closure.
    (ii) A formal plan of operation including specific actions and 
assignments of responsibility by individual name or title.
    (iii) Provisions for periodic operation, at not less than one-year 
intervals, of the closure structure for testing and training purposes.
    (2) Interior drainage systems. Interior drainage systems associated 
with levee systems usually include storage areas, gravity outlets, 
pumping stations, or a combination thereof. These drainage systems will 
be recognized by FEMA on NFIP maps for flood protection purposes only if 
the following minimum criteria are included in the operation plan:
    (i) Documentation of the flood warning system, under the 
jurisdiction of Federal, State, or community officials, that will be 
used to trigger emergency operation activities and demonstration that 
sufficient flood warning time exists to permit activation of mechanized 
portions of the drainage system.
    (ii) A formal plan of operation including specific actions and 
assignments of responsibility by individual name or title.
    (iii) Provision for manual backup for the activation of automatic 
systems.
    (iv) Provisions for periodic inspection of interior drainage systems 
and periodic operation of any mechanized portions for testing and 
training purposes. No more than one year shall elapse between either the 
inspections or the operations.
    (3) Other operation plans and criteria. Other operating plans and 
criteria may be required by FEMA to ensure that adequate protection is 
provided in specific situations. In such cases, sound emergency 
management practice will be the standard upon which FEMA determinations 
will be based.
    (d) Maintenance plans and criteria. For levee systems to be 
recognized as providing protection from the base flood, the maintenance 
criteria must be as described herein. Levee systems must be maintained 
in accordance with an officially adopted maintenance plan,

[[Page 338]]

and a copy of this plan must be provided to FEMA by the owner of the 
levee system when recognition is being sought or when the plan for a 
previously recognized system is revised in any manner. All maintenance 
activities must be under the jurisdiction of a Federal or State agency, 
an agency created by Federal or State law, or an agency of a community 
participating in the NFIP that must assume ultimate responsibility for 
maintenance. This plan must document the formal procedure that ensures 
that the stability, height, and overall integrity of the levee and its 
associated structures and systems are maintained. At a minimum, 
maintenance plans shall specify the maintenance activities to be 
performed, the frequency of their performance, and the person by name or 
title responsible for their performance.
    (e) Certification requirements. Data submitted to support that a 
given levee system complies with the structural requirements set forth 
in paragraphs (b)(1) through (7) of this section must be certified by a 
registered professional engineer. Also, certified as-built plans of the 
levee must be submitted. Certifications are subject to the definition 
given at Sec. 65.2 of this subchapter. In lieu of these structural 
requirements, a Federal agency with responsibility for levee design may 
certify that the levee has been adequately designed and constructed to 
provide protection against the base flood.

[51 FR 30316, Aug. 25, 1986]



Sec. 65.11  Evaluation of sand dunes in mapping coastal flood hazard areas.

    (a) General conditions. For purposes of the NFIP, FEMA will consider 
storm-induced dune erosion potential in its determination of coastal 
flood hazards and risk mapping efforts. The criterion to be used in the 
evaluation of dune erosion will apply to primary frontal dunes as 
defined in Sec. 59.1, but does not apply to artificially designed and 
constructed dunes that are not well-established with long-standing 
vegetative cover, such as the placement of sand materials in a dune-like 
formation.
    (b) Evaluation criterion. Primary frontal dunes will not be 
considered as effective barriers to base flood storm surges and 
associated wave action where the cross-sectional area of the primary 
frontal dune, as measured perpendicular to the shoreline and above the 
100-year stillwater flood elevation and seaward of the dune crest, is 
equal to, or less than, 540 square feet.
    (c) Exceptions. Exceptions to the evaluation criterion may be 
granted where it can be demonstrated through authoritative historical 
documentation that the primary frontal dunes at a specific site 
withstood previous base flood storm surges and associated wave action.

[53 FR 16279, May 6, 1988]



Sec. 65.12  Revision of flood insurance rate maps to reflect base flood elevations caused by proposed encroachments.

    (a) When a community proposes to permit encroachments upon the flood 
plain when a regulatory floodway has not been adopted or to permit 
encroachments upon an adopted regulatory floodway which will cause base 
flood elevation increases in excess of those permitted under paragraphs 
(c)(10) or (d)(3) of Sec. 60.3 of this subchapter, the community shall 
apply to the Administrator for conditional approval of such action prior 
to permitting the encroachments to occur and shall submit the following 
as part of its application:
    (1) A request for conditional approval of map change and the 
appropriate initial fee as specified by Sec. 72.3 of this subchapter or 
a request for exemption from fees as specified by Sec. 72.5 of this 
subchapter, whichever is appropriate;
    (2) An evaluation of alternatives which would not result in a base 
flood elevation increase above that permitted under paragraphs (c)(10) 
or (d)(3) of Sec. 60.3 of this subchapter demonstrating why these 
alternatives are not feasible;
    (3) Documentation of individual legal notice to all impacted 
property owners within and outside of the community, explaining the 
impact of the proposed action on their property.
    (4) Concurrence of the Chief Executive Officer of any other 
communities impacted by the proposed actions;

[[Page 339]]

    (5) Certification that no structures are located in areas which 
would be impacted by the increased base flood elevation;
    (6) A request for revision of base flood elevation determination 
according to the provisions of Sec. 65.6 of this part;
    (7) A request for floodway revision in accordance with the 
provisions of Sec. 65.7 of this part;
    (b) Upon receipt of the Administrator's conditional approval of map 
change and prior to approving the proposed encroachments, a community 
shall provide evidence to the Administrator of the adoption of flood 
plain management ordinances incorporating the increased base flood 
elevations and/or revised floodway reflecting the post-project 
condition.
    (c) Upon completion of the proposed encroachments, a community shall 
provide as-built certifications in accordance with the provisions of 
Sec. 65.3 of this part. The Administrator will initiate a final map 
revision upon receipt of such certifications in accordance with part 67 
of this subchapter.

[53 FR 16279, May 6, 1988]



Sec. 65.13  Mapping and map revisions for areas subject to alluvial fan flooding.

    This section describes the procedures to be followed and the types 
of information FEMA needs to recognize on a NFIP map that a structural 
flood control measure provides protection from the base flood in an area 
subject to alluvial fan flooding. This information must be supplied to 
FEMA by the community or other party seeking recognition of such a flood 
control measure at the time a flood risk study or restudy is conducted, 
when a map revision under the provisions of part 65 of this subchapter 
is sought, and upon request by the Administrator during the review of 
previously recognized flood control measures. The FEMA review will be 
for the sole purpose of establishing appropriate risk zone 
determinations for NFIP maps and shall not constitute a determination by 
FEMA as to how the flood control measure will perform in a flood event.
    (a) The applicable provisions of Secs. 65.2, 65.3, 65.4, 65.6, 65.8 
and 65.10 shall also apply to FIRM revisions involving alluvial fan 
flooding.
    (b) The provisions of Sec. 65.5 regarding map revisions based on 
fill and the provisions of part 70 of this chapter shall not apply to 
FIRM revisions involving alluvial fan flooding. In general, elevations 
of a parcel of land or a structure by fill or other means, will not 
serve as a basis for removing areas subject to alluvial fan flooding 
from an area of special food hazards.
    (c) FEMA will credit on NFIP maps only major structural flood 
control measures whose design and construction are supported by sound 
engineering analyses which demonstrate that the measures will 
effectively eliminate alluvial fan flood hazards from the area protected 
by such measures. The provided analyses must include, but are not 
necessarily limited to, the following:
    (1) Engineering analyses that quantify the discharges and volumes of 
water, debris, and sediment movement associated with the flood that has 
a one-percent probability of being exceeded in any year at the apex 
under current watershed conditions and under potential adverse 
conditions (e.g., deforestation of the watershed by fire). The potential 
for debris flow and sediment movement must be assessed using an 
engineering method acceptable to FEMA. The assessment should consider 
the characteristics and availability of sediment in the drainage basin 
above the apex and on the alluvial fan.
    (2) Engineering analyses showing that the measures will accommodate 
the estimated peak discharges and volumes of water, debris, and 
sediment, as determined in accordance with paragraph (c)(1) of this 
section, and will withstand the associated hydrodynamic and hydrostatic 
forces.
    (3) Engineering analyses showing that the measures have been 
designed to withstand the potential erosion and scour associated with 
estimated discharges.
    (4) Engineering analyses or evidence showing that the measures will 
provide protection from hazards associated with the possible relocation 
of flow paths from other parts of the fan.

[[Page 340]]

    (5) Engineering analyses that assess the effect of the project on 
flood hazards, including depth and velocity of floodwaters and scour and 
sediment deposition, on other areas of the fan.
    (6) Engineering analyses demonstrating that flooding from scources 
other than the fan apex, including local runoff, is either insignificant 
or has been accounted for in the design.
    (d) Coordination. FEMA will recognize measures that are adequately 
designed and constructed, provided that: evidence is submitted to show 
that the impact of the measures on flood hazards in all areas of the fan 
(including those not protected by the flood control measures), and the 
design and maintenance requirements of the measures, were reviewed and 
approved by the impacted communities, and also by State and local 
agencies that have jurisdiction over flood control activities.
    (e) Operation and maintenance plans and criteria. The requirements 
for operation and maintenance of flood control measures on areas subject 
to alluvial fan flooding shall be those specified under Sec. 65.10, 
paragraphs (c) and (d), when applicable.
    (f) Certification requirements. Data submitted to support that a 
given flood control measure complies with the requirements set forth in 
paragraphs (c) (1) through (6) of this section must be certified by a 
registered professional engineer. Also, certified as-built plans of the 
flood control measures must be submitted. Certifications are subject to 
the definition given at Sec. 65.2.

(Approved by the Office of Management and Budget under control number 
3067-0147.)


[54 FR 33551, Aug. 15, 1989]



Sec. 65.14  Remapping of areas for which local flood protection systems no longer provide 100-year flood protection.

    (a) General. (1) This section describes the procedures to follow and 
the types of information FEMA requires to designate flood control 
restoration zones. A community may be eligible to apply for this zone 
designation if the Director determines that it is engaged in the process 
of restoring a flood protection system that was:
    (i) Constructed using Federal funds;
    (ii) Recognized as providing 100-year flood protection on the 
community's effective Flood Insurance Rate Map; and
    (iii) Decertified by a Federal agency responsible for flood 
protection design or construction.
    (2) Where the Director determines that a community is in the process 
of restoring its flood protection system to provide 100-year minimum 
flood protection, a Flood Insurance Rate Map will be prepared that 
designates the temporary flood hazard areas as a flood control 
restoration zone (Zone AR). Existing Special Flood Hazard Areas shown on 
the community's effective Flood Insurance Rate Map that are further 
inundated by Zone AR flooding shall be designated as a ``dual'' flood 
insurance rate zone, Zone AR/AE or AR/AH with Zone AR base flood 
elevations, and AE or AH with base flood elevations and Zone AR/AO with 
Zone AR base flood elevations and Zone AO with flood depths, or Zone AR/
A with Zone AR base flood elevations and Zone A without base flood 
elevations.
    (b) Limitations. A community may have a flood control restoration 
zone designation only once for the purposes of restoring a given flood 
protection system and must complete restoration of the system or meet 
the requirements of 44 CFR 61.12 within a specified period, not to 
exceed ten (10) years from the date of submittal of the community's 
application for designation of a flood control restoration zone. The 
community may not extend this period. The information specified in this 
section must be supplied to FEMA by the community as part of its request 
for designation of a flood control restoration zone.
    (c) Exclusions. The provisions of these regulations do not apply in 
a coastal high hazard area as defined in 44 CFR 59.1, including areas 
that would be subject to coastal high hazards as a result of the 
decertification of a flood protection system shown on the community's 
effective Flood Insurance Rate Map (FIRM) as providing 100-year 
protection.
    (d) Effective date for risk premium rates. The effective date for 
any risk premium rates established for Zone AR

[[Page 341]]

shall be the effective date of the revised Flood Insurance Rate Map 
showing AR Zone designations.
    (e) Application and submittal requirements for designation of a 
flood control restoration zone. A community must submit a written 
request to the Director, signed by the community's Chief Executive 
Officer, for a flood plain designation as a flood control restoration 
zone. The request must include a legislative action by the community 
requesting the designation. The Director will not initiate any action to 
designate flood control restoration zones without receipt of the formal 
request from the community that complies with all requirements of this 
section. The Director reserves the right to request additional 
information from the community to support or further document the 
community's formal request for designation of a flood control 
restoration zone, if deemed necessary. At a minimum, each request must 
include the following:
    (1) A statement whether, to the best of the knowledge of the 
community's Chief Executive Officer, the flood protection system is 
currently the subject matter of litigation before any Federal, State or 
local court or administrative agency, and if so, the purpose of that 
litigation;
    (2) A statement whether the community has previously requested a 
determination with respect to the same subject matter from the Director, 
and if so, a statement that details the disposition of such previous 
request;
    (3) A statement from the community and certification by a Federal 
agency responsible for flood protection design or construction that the 
existing flood control system shown on the effective Flood Insurance 
Rate Map was built using Federal funds, that it no longer provides 100-
year flood protection, but that it continues to provide at least a 35-
year level of protection;
    (4) A statement identifying the local project sponsor responsible 
for restoration of the flood protection system to the 100-year or 
greater level of flood protection;
    (5) a copy of a study, performed by a Federal agency responsible for 
flood protection design or construction in consultation with the local 
project sponsor, which demonstrates a Federal interest in restoration of 
the system and which deems that the flood protection system is 
restorable to a 100-year or greater level of flood protection.
    (6) A joint statement from the Federal agency responsible for flood 
protection design or construction involved in restoration of the flood 
protection system and the local project sponsor certifying that the 
design and construction of the flood control system involves Federal 
funds, and that the restoration of the flood protection system will 
provide 100-year or greater flood protection;
    (7) A restoration plan to return the system to a 100-year or greater 
level of protection. At a minimum, this plan must:
    (i) List all important project elements, such as acquisition of 
permits, approvals, and contracts and construction schedules of planned 
features;
    (ii) Identify anticipated start and completion dates for each 
element, as well as significant milestones and dates;
    (iii) Identify the date on which ``as built'' drawings and 
certification for the completed restoration project will be submitted. 
This date must provide for a restoration period not to exceed, ten (10) 
years from the date of submittal of the community's application for 
designation as a flood control restoration zone, or;
    (iv) Identify the date on which the community will submit a request 
for a finding of adequate progress that meets all requirements of 
Sec. 61.12. This date may not exceed ten (10) years from the date of 
submittal of the community's application for designation as a flood 
control restoration zone;
    (8) An official map of the community or legal description, with 
supporting documentation, that the community will adopt as part of its 
floodplain management measures, which designates developed areas as 
defined in Sec. 59.1 and as further defined in Sec. 60.3(f).
    (f) Review and response by the Director. The review and response by 
the Director shall be in accordance with procedures specified in 
Sec. 65.9.
    (g) Requirements for maintaining designation of a flood control 
restoration zone. During the restoration period, the

[[Page 342]]

community and the cost-sharing Federal agency must certify annually to 
the FEMA Regional Office having jurisdiction that the restoration will 
be completed in accordance with the restoration plan within the time 
period specified by the plan. In addition, the community and the Federal 
agency will update the restoration plan and will identify any permitting 
or construction problems that will delay the project completion from the 
restoration plan previously submitted to the Director. The FEMA Regional 
Office having jurisdiction will make an annual assessment and 
recommendation to the Director as to the viability of the restoration 
plan and will conduct periodic on-site inspections of the flood 
protection system under restoration.
    (h) Procedures for removing flood control restoration zone 
designation due to adequate progress or complete restoration of the 
flood protection system. At any time during the restoration period, the 
community may provide written evidence of certification from a Federal 
agency having flood protection design or construction responsibility 
that the necessary improvements have been completed and that the system 
has been restored to provide a minimum 100-year level of protection, or 
may submit a request for a finding of adequate progress that meets all 
requirements of section 61.12. If the Director determines that adequate 
progress has been made, FEMA will revise the zone designation from a 
flood control restoration zone designation to Zone A99. After the 
improvements have been completed and certified by a Federal agency as 
providing a minimum 100-year level of protection, FEMA will revise the 
Flood Insurance Rate Map to reflect the completed flood control system.
    (i) Procedures for removing flood control restoration zone 
designation due to non-compliance with the restoration schedule or as a 
result of a finding that satisfactory progress is not being made to 
complete the restoration. At any time during the restoration period, 
should the Director determine that the restoration will not be completed 
in accordance with the time frame specified in the restoration plan, or 
that satisfactory progress is not being made to restore the flood 
protection system to provide complete flood protection in accordance 
with the restoration plan, the Director shall notify the community and 
the responsible Federal agency, in writing, of the determination, the 
reasons for that determination, and that the Flood Insurance Rate Map 
will be revised to remove the flood control restoration zone 
designation. Within thirty (30) days of such notice, the community may 
submit written information that provides assurance that the restoration 
will be completed in accordance with the time frame specified in the 
restoration plan, or that satisfactory progress is being made to restore 
complete protection in accordance with the restoration plan, or that, 
with reasonable certainty, the restoration will be completed within the 
maximum restoration period, which may not exceed ten (10) years from the 
date of submittal of the community's application for designation of a 
flood control restoration zone. On the basis of this information the 
Director may suspend the decision to revise the Flood Insurance Rate Map 
to remove the flood control restoration zone designation. If the 
community does not submit any information, or if, based on a review of 
the information submitted, there is sufficient cause to find that the 
restoration will not be completed as provided for in the restoration 
plan, the Director shall revise the Flood Insurance Rate Map, in 
accordance with 44 CFR Part 67, and shall remove the flood control 
restoration zone designations and shall redesignate those areas as Zone 
A1-30, AE, AH, AO, or A.

[59 FR 53599, Oct. 25, 1994]



Sec. 65.15  List of communities submitting new technical data.

    This section provides a cumulative list of communities where 
modifications of the base flood elevation determinations have been made 
because of submission of new scientific or technical data. Due to the 
need for expediting the modifications, the revised map is already in 
effect and the appeal period commences on or about the effective date of 
the modified map. An interim rule, followed by a final rule, will list 
the revised map effective date,

[[Page 343]]

local repository and the name and address of the Chief Executive Officer 
of the community. The map(s) is (are) effective for both flood plain 
management and insurance purposes.

[51 FR 30317, Aug. 25, 1986. Redesignated at 53 FR 16279, May 6, 1988, 
and further redesignated at 54 FR 33551, Aug. 15, 1989. Redesignated at 
59 FR 53599, Oct. 25, 1994]


    Editorial Note: For references to FR pages showing lists of eligible 
communities, see the List of CFR Sections Affected appearing in the 
Finding Aids section of this volume.



Sec. 65.16  Standard Flood Hazard Determination Form and instructions.

    Section 528 of the National Flood Insurance Reform Act of 1994 (42 
U.S.C. 1365(a)) directs that FEMA shall develop a standard form for 
determining, in the case of a loan secured by improved real estate or a 
mobile home, whether the building or mobile home is located in an area 
identified by the Director as an area having special flood hazards and 
in which flood insurance under this title is available. The purpose of 
the form is to determine whether a building or mobile home is located 
within an identified Special Flood Hazard Area (SFHA), whether flood 
insurance is required, and whether federal flood insurance is available. 
Use of this form will ensure that required flood insurance coverage is 
purchased for structures located in an SFHA, and will assist federal 
entities for lending regulation in assuring compliance with these 
purchase requirements. The Standard Flood Hazard Determination Form and 
accompanying instructions are found in Appendix A to this Part.

[60 FR 35281, July 6, 1995]



Sec. 65.17  Review of determinations.

    This section describes the procedures that shall be followed and the 
types of information required by FEMA to review a determination of 
whether a building or manufactured home is located within an identified 
Special Flood Hazard Area (SFHA).
    (a) General conditions. The borrower and lender of a loan secured by 
improved real estate or a manufactured home may jointly request that 
FEMA review a determination that the building or manufactured home is 
located in an identified SFHA. Such a request must be submitted within 
45 days of the lender's notification to the borrower that the building 
or manufactured home is in the SFHA and that flood insurance is 
required. Such a request must be submitted jointly by the lender and the 
borrower and shall include the required fee and technical information 
related to the building or manufactured home. Elevation data will not be 
considered under the procedures described in this section.
    (b) Data and other requirements. Items required for FEMA's review of 
a determination shall include the following:
    (1) Payment of the required fee by check or money order, in U.S. 
funds, payable to the National Flood Insurance Program;
    (2) A request for FEMA's review of the determination, signed by both 
the borrower and the lender;
    (3) A copy of the lender's notification to the borrower that the 
building or manufactured home is in an SFHA and that flood insurance is 
required (the request for review of the determination must be postmarked 
within 45 days of borrower notification);
    (4) A completed Standard Flood Hazard Determination Form for the 
building or manufactured home, together with a legible hard copy of all 
technical data used in making the determination; and
    (5) A copy of the effective NFIP map (Flood Hazard Boundary Map 
(FHBM) or Flood Insurance Rate Map (FIRM)) panel for the community in 
which the building or manufactured home is located, with the building or 
manufactured home location indicated. Portions of the map panel may be 
submitted but shall include the area of the building or manufactured 
home in question together with the map panel title block, including 
effective date, bar scale, and north arrow.
    (c) Review and response by FEMA. Within 45 days after receipt of a 
request to review a determination, FEMA will notify the applicants in 
writing of one of the following:
    (1) Request submitted more than 45 days after borrower notification; 
no review will be performed and all materials are being returned;

[[Page 344]]

    (2) Insufficient information was received to review the 
determination; therefore, the determination stands until a complete 
submittal is received; or
    (3) The results of FEMA's review of the determination, which shall 
include the following:
    (i) The name of the NFIP community in which the building or 
manufactured home is located;
    (ii) The property address or other identification of the building or 
manufactured home to which the determination applies;
    (iii) The NFIP map panel number and effective date upon which the 
determination is based;
    (iv) A statement indicating whether the building or manufactured 
home is within the Special Flood Hazard Area;
    (v) The time frame during which the determination is effective.

[60 FR 62218, Dec. 5, 1995]

[[Page 345]]



  Appendix A to Part 65--Federal Emergency Management Agency, Standard 
            Flood Hazard Determination Form and Instructions
[GRAPHIC] [TIFF OMITTED] TC02FE91.078


[[Page 346]]



          Standard Flood Hazard Determination Form Instructions

                   Paperwork Burden Disclosure Notice

    Public reporting burden for FEMA Form 81-93 is estimated to average 
20 minutes per response. The burden estimate includes the time for 
reviewing instructions, searching existing data sources, gathering and 
maintaining the data needed, and completing and reviewing the form. Send 
comments regarding the accuracy of the burden estimate and any 
suggestions for reducing the burden to: Information Collections 
Management, Federal Emergency Management Agency, 500 C Street, SW, 
Washington, DC 20472; and to the Office of Management and Budget, 
Paperwork Reduction Project (30676-0264), Washington, DC 20503.


    Note: The 1-800 number referred to in these instructions is not 
available as of June 1995. FEMA is in the process of establishing this 
service and will have this number in place by December 1995. A notice 
will be published in the Federal Register announcing this service. In 
the meantime, community status information can be obtained by faxing a 
request to (202) 646-3445. Mapping information can be obtained by faxing 
a request to (202) 646-4596.

                                Section I

    1. Lender Name and Address: Enter lender name and address.
    2. Collateral (Building/Mobile Home/Personal Property) Property 
Address: Enter property address for the insurable collateral. In rural 
areas, a postal address may not be sufficient to locate the property. In 
these cases, legal property descriptions may be used and may be attached 
to the form if space provided is insufficient.
    3. Lender Id. No.: The lender funding the loan should identify 
itself as follows: FDIC-insured lenders should indicate their FDIC 
Insurance Certificate Number; Federally-insured credit unions should 
indicate their charter/insurance number; Farm Credit institutions should 
indicate their UNINUM number. Other lenders who fund loans sold to or 
securitized by FNMA or FHLMC should enter the FNMA or FHLMC seller/
servicer number.
    4. Loan Identifier: Optional. May be used by lenders to conform with 
their individual method of identifying loans.
    5. Amount of Flood Insurance Required: Optional. The minimum federal 
requirement for this amount is the lesser of: the outstanding principal 
loan balance; the value of the improved property, mobile home and/or 
personal property used to secure the loan; or the maximum statutory 
limit of flood insurance coverage. Lenders may exceed the minimum 
federal requirements. National Flood Insurance Program (NFIP) policies 
do not provide coverage in excess of the value of the building/mobile 
home/personal property.

                               Section II

    A. National Flood Insurance Program (NFIP) Community Jurisdiction

    NFIP Community Name. Enter the complete name of the community (as 
indicated on the NFIP map) in which the building or mobile home is 
located. Under the NFIP, a community is any State or area or political 
subdivision thereof, or any Indian tribe or authorized tribal 
organization, or Alaska Native village or authorized native 
organization, which has authority to adopt and enforce floodplain 
management regulations for the areas within its jurisdiction. (Examples: 
Brewer, City of; Blue Springs, Town of; Washington, Borough of; 
Worcester, Township of; Baldwin County; Jefferson Parish.) For a 
building or mobile home that may have been annexed by one community but 
is shown on another community's NFIP map, enter the Community Name for 
the community with land-use jurisdiction over the building or mobile 
home.
    County(ies). Enter the name of the county or counties in which the 
community is located. For unincorporated areas of a county, enter 
``unincorporated areas.'' For independent cities, enter ``independent 
city.''
    State. Enter the two-digit state abbreviation. (Examples: VA, TX, 
CA.)
    NFIP Community Number. Enter the 6-digit NFIP community number. This 
number can be determined by consulting the NFIP Eligibility Book or can 
be found on the NFIP map; copies of either can be obtained by calling 1-
800-xxx-xxxx. If no NFIP Community Number exists for the community, 
enter ``none''.

               B. NFIP Data Affecting Building/Mobile Home

    The information in this section (excluding the LOMA/LOMR 
information) is obtained by reviewing the NFIP map on which the 
building/mobile home is located. The current NFIP map, and a pamphlet 
titled ``Guide to Flood Maps,'' may be obtained by calling 1-800-xxx-
xxxx. Note that even when an NFIP map panel is not printed, it may be 
reflected on a community's NFIP map index with its proper number, date, 
and flood zone indicated; enter these data accordingly.
    NFIP Map Number or Community-Panel Number. Enter the 11-digit number 
shown on the NFIP map that covers the building or mobile home. 
(Examples: 480214 0022 C; 5810C0075 F.) Note that the first six digits 
will not match the NFIP Community Number when the sixth digit is a ``C'' 
or when one community has annexed land from another but the NFIP map has 
not yet been updated to reflect this annexation. When the sixth digit is 
a ``C'', the NFIP map is in countywide format and shows the flood 
hazards for the geographic

[[Page 347]]

areas of the county on one map, including flood hazards for incorporated 
communities and for any unincorporated county contained within the 
county's geographic limits. Such countywide maps will list an NFIP Map 
Number. For maps not in such countywide format, the NFIP map will list a 
Community-Panel Number on each panel. If no NFIP map is in effect for 
the location of the building or mobile home, enter ``none''.
    NFIP Map Panel Effective/Revised Date. Enter the map effective date 
or the map revised date shown on the NFIP map. (Example: 6/15/93.) This 
will be the latest of all dates shown on the map.
    LOMA/LOMR. If a Letter of Map Amendment (LOMA) or Letter of Map 
Revision (LOMR) has been issued by the Federal Emergency Management 
Agency (FEMA) since the current Map Panel Effective/Revised Date that 
revises the flood hazards affecting the building or mobile home, check 
``yes'' and specify the date of the letter; otherwise, no entry is 
required. Information on LOMAs and LOMRs is available from the following 
sources:
    1. The community's official copy of its NFIP map should have a copy 
of all subsequently-issued LOMAs and LOMRs attached to it.
    2. For LOMAs and LOMRs issued on or after October 1, 1994, FEMA 
publishes a list of these letters twice a year as a compendium in the 
Federal Register; a subscription service providing actual copies of 
these letters semi-monthly is also available. To inquire about these two 
services, call 1-800-xxx-xxxx.
    3. Most LOMAs and LOMRs issued since 1983 nationwide are contained 
in FEMA's Community Information System. An electronic listing may be 
requested, and may be limited to specific communities or states, if 
desired. For information on this service, call 1-800-xxx-xxxx.
    Flood Zone. Enter the flood zone covering the building or mobile 
home. (Examples: A, AE, A1-30, V, VE, V1-30, AH, AO, B, C, X, D.) If the 
building or mobile home straddles the dividing line between two flood 
zones, list both. All flood zones beginning with the letter ``A'' or 
``V'' are considered Special Flood Hazard Areas (SFHAs). Each flood zone 
is defined in the legend of the NFIP map on which it appears.
    No NFIP Map. If no NFIP map covers the area where the building or 
mobile home is located, check this box.

                 C. Federal Flood Insurance Availability

    Check all boxes that apply; however, note that boxes 1 (Federal 
Flood Insurance is available * * *) and 2 (Federal Flood Insurance is 
not available * * *) are mutually exclusive. Federal flood insurance is 
available to all residents of a community that participates in the NFIP. 
Community participation status can be determined by consulting the NFIP 
Eligibility Book, which can be obtained by calling 1-800-xxx-xxxx. The 
NFIP Eligibility Book will indicate whether or not the community is 
participating in the NFIP and whether participation is in the Emergency 
or Regular Program. If the community participates in the NFIP, check 
either Regular Program or Emergency Program. To obtain Federal flood 
insurance, a copy of this completed form may be provided to an insurance 
agent.
    Federal flood insurance is prohibited in designated Coastal Barrier 
Resources Areas (CBRA) for buildings or mobile homes built or 
substantially improved after the date of the CBRA designation. An 
information sheet explaining CBRA areas may be obtained by calling 1-
800-xxx-xxxx.
    D. Determination: If any portion of the building/mobile home is in 
an identified SFHA, check yes (flood insurance is required). If no 
portion of the building/mobile home is in an identified SFHA, check no.
    E. Comments: Optional. Persons completing the form may use this 
portion in any manner.
    F. Preparer's Information: If other than the lender, enter the name, 
address, and telephone number of the company or organization performing 
the flood hazard determination. An individual's name may be included, 
but is not required.
    Date of Determination. Enter date on which the flood hazard 
determination was completed.

                            Other Information

    Multiple Buildings: If the loan collateral includes more than one 
building, a schedule for the additional building(s)/mobile home(s) 
indicating the determination for each may be attached. Otherwise, a 
separate form must be completed for each building or mobile home. Any 
attachment(s) should be noted in the comment section. A separate flood 
insurance policy is required for each building or mobile home.
    Guarantees Regarding Information: Determinations on this form made 
by persons other than the lender are acceptable only to the extent that 
the accuracy of the information is guaranteed.

[60 FR 35281, July 6, 1995]



PART 66--CONSULTATION WITH LOCAL OFFICIALS--Table of Contents




Sec.
66.1  Purpose of part.
66.2  Definitions.
66.3  Establishment of community case file and flood elevation study 
          docket.
66.4  Appointment of consultation coordination officer.

[[Page 348]]

66.5  Responsibilities for consultation and coordination.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.



Sec. 66.1  Purpose of part.

    (a) The purpose of this part is to comply with section 206 of the 
Flood Disaster Protection Act of 1973 (42 U.S.C. 4107) by establishing 
procedures for flood elevation determinations of Zones A1-30, AE, AH, AO 
and V1-30, and VE within the community so that adequate consultation 
with the community officials shall be assured.
    (b) The procedures in this part shall apply when base flood 
elevations are to be determined or modified.
    (c) The Administrator or his delegate shall:
    (1) Specifically request that the community submit pertinent data 
concerning flood hazards, flooding experience, plans to avoid potential 
hazards, estimate of historical and prospective economic impact on the 
community, and such other appropriate data (particularly if such data 
will necessitate a modification of a base flood elevation).
    (2) Notify local officials of the progress of surveys, studies, 
investigations, and of prospective findings, along with data and methods 
employed in reaching such conclusions; and
    (3) Encourage local dissemination of surveys, studies, and 
investigations so that interested persons will have an opportunity to 
bring relevant data to the attention of the community and to the 
Administrator.
    (4) Carry out the responsibilities for consultation and coordination 
set forth in Sec. 66.5 of this part.

[41 FR 46988, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 771, Jan. 7, 1982; 48 FR 44553, Sept. 29, 1983; 49 
FR 4751, Feb. 8, 1984; 50 FR 36028, Sept. 4, 1985]



Sec. 66.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.

[41 FR 46988, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 66.3  Establishment of community case file and flood elevation study docket.

    (a) A file shall be established for each community at the time 
initial consideration is given to studying that community in order to 
establish whether or not it contains flood-prone areas. Thereafter, the 
file shall include copies of all correspondence with officials in that 
community. As the community is tentatively identified, provided with 
base flood elevations, or suspended and reinstated, documentation of 
such actions by the Administrator shall be placed in the community file. 
Even if a map is administratively rescinded or withdrawn after notice 
under part 65 of this subchapter or the community successfully rebuts 
its flood-prone designation, the file will be maintained indefinitely.
    (b) A portion of the community file shall be designated a flood 
elevation study consultation docket and shall be established for each 
community at the time the contract is awarded for a flood elevation 
study. The docket shall include copies of (1) all correspondence between 
the Administrator and the community concerning the study, reports of any 
meetings among the Agency representatives, property owners of the 
community, the state coordinating agency, study contractors or other 
interested persons, (2) relevant publications, (3) a copy of the 
completed flood elevation study, and (4) a copy of the Administrator's 
final determination.
    (c) A flood elevation determination docket shall be established and 
maintained in accordance with part 67 of this subchapter.

[41 FR 46988, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544 and 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 
1984]



Sec. 66.4  Appointment of consultation coordination officer.

    The Administrator may appoint an employee of the Federal Emergency 
Management Agency, or other designated Federal employee, as the 
Consultation Coordination Officer, for each community when an analysis 
is undertaken to establish or to modify flood elevations pursuant to a 
new study or a restudy. When a CCO is appointed by

[[Page 349]]

the Administrator, the responsibilities for consultation and 
coordination as set forth in Sec. 66.5 shall be carried out by the CCO. 
The Administrator shall advise the community and the state coordinating 
agency, in writing, of this appointment.

[47 FR 771, Jan. 7, 1982, as amended at 49 FR 4751, Feb. 8, 1984]



Sec. 66.5  Responsibilities for consultation and coordination.

    (a) Contact shall be made with appropriate officials of a community 
in which a proposed investigation is undertaken, and with the state 
coordinating agency.
    (b) Local dissemination of the intent and nature of the 
investigation shall be encouraged so that interested parties will have 
an opportunity to bring relevant data to the attention of the community 
and to the Administrator.
    (c) Submission of information from the community concerning the 
study shall be encouraged.
    (d) Appropriate officials of the community shall be fully informed 
of (1) The responsibilities placed on them by the Program, (2) the 
administrative procedures followed by the Federal Emergency Management 
Agency, (3) the community's role in establishing elevations, and (4) the 
responsibilities of the community if it participates or continues to 
participate in the Program.
    (e) Before the commencement of an initial Flood Insurance Study, the 
CCO or other FEMA representative, together with a representative of the 
organization undertaking the study, shall meet with officials of the 
community. The state coordinating agency shall be notified of this 
meeting and may attend. At this meeting, the local officials shall be 
informed of (1) The date when the study will commence, (2) the nature 
and purpose of the study, (3) areas involved, (4) the manner in which 
the study shall be undertaken, (5) the general principles to be applied, 
and (6) the intended use of the data obtained. The community shall be 
informed in writing if any of the six preceding items are or will be 
changed after this initial meeting and during the course of the ongoing 
study.
    (f) The community shall be informed in writing of any intended 
modification to the community's final flood elevation determinations or 
the development of new elevations in additional areas of the community 
as a result of a new study or restudy. Such information to the community 
will include the data set forth in paragraph (e) of this section. At the 
discretion of the Chief of the Natural and Technological Hazards 
Division in each FEMA Regional Office, a meeting may be held to 
accomplish this requirement.

[47 FR 771, Jan. 7, 1982, as amended at 49 FR 4751, Feb. 8, 1984]



PART 67--APPEALS FROM PROPOSED FLOOD ELEVATION DETERMINATIONS--Table of Contents




Sec.
67.1  Purpose of part.
67.2  Definitions.
67.3  Establishment and maintenance of a flood elevation determination 
          docket (FEDD).
67.4  Proposed flood elevation determination.
67.5  Right of appeal.
67.6  Basis of appeal.
67.7  Collection of appeal data.
67.8  Appeal procedure.
67.9  Final determination in the absence of an appeal by the community.
67.10  Rates during pendency of final determination.
67.11  Notice of final determination.
67.12  Appeal to District Court.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 
Comp., p. 376.

    Source: 41 FR 46989, Oct. 26, 1976, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.



Sec. 67.1  Purpose of part.

    The purpose of this part is to establish procedures implementing the 
provisions of section 110 of Flood Disaster Protection Act of 1973.



Sec. 67.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.

[[Page 350]]



Sec. 67.3  Establishment and maintenance of a flood elevation determination docket (FEDD).

    The Administrator shall establish a docket of all matters pertaining 
to flood elevation determinations. The docket files shall contain the 
following information:
    (a) The name of the community subject to the flood elevation 
determination;
    (b) A copy of the notice of the proposed flood elevation 
determination to the Chief Executive Officer (CEO) of the Community;
    (c) A copy of the notice of the proposed flood elevation 
determination published in a prominent local newspaper of the community;
    (d) A copy of the notice of the proposed flood elevation 
determination published in the Federal Register;
    (e) Copies of all appeals by private persons received by the 
Administrator from the CEO;
    (f) Copies of all comments received by the Administrator on the 
notice of the proposed flood elevation determination published in the 
Federal Register.
    (g) A copy of the community's appeal or a copy of its decision not 
to appeal the proposed flood elevation determination;
    (h) A copy of the flood insurance study for the community;
    (i) A copy of the FIRM for the community;
    (j) Copies of all materials maintained in the flood elevation study 
consultation docket; and
    (k) A copy of the final determination with supporting documents.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 67.4  Proposed flood elevation determination.

    The Administrator shall propose flood elevation determinations in 
the following manner:
    (a) Publication of the proposed flood elevation determination for 
comment in the Federal Register;
    (b) Notification by certified mail, return receipt requested, of the 
proposed flood elevation determination to the CEO; and
    (c) Publication of the proposed flood elevation determination in a 
prominent local newspaper at least twice during the ten day period 
immediately following the notification of the CEO.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]

    Editorial Note: For references to FR pages showing lists of flood 
elevation determinations, see the List of CFR Sections Affected 
appearing in the Finding Aids section of this volume.



Sec. 67.5  Right of appeal.

    (a) Any owner or lessee of real property, within a community where a 
proposed flood elevation determination has been made pursuant to section 
1363 of the National Flood Insurance Act of 1968, as amended, who 
believes his property rights to be adversely affected by the 
Administrator's proposed determination, may file a written appeal of 
such determination with the CEO, or such agency as he shall publicly 
designate, within ninety days of the second newspaper publication of the 
Administrator's proposed determination.
    (b)[Reserved]

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 67.6  Basis of appeal.

    (a) The sole basis of appeal under this part shall be the possession 
of knowledge or information indicating that the elevations proposed by 
FEMA are scientifically or technically incorrect. Because scientific and 
technical correctness is often a matter of degree rather than absolute 
(except where mathematical or measurement error or changed physical 
conditions can be demonstrated), appellants are required to demonstrate 
that alternative methods or applications result in more correct 
estimates of base flood elevations, thus demonstrating that FEMA's 
estimates are incorrect.
    (b) Data requirements. (1) If an appellant believes the proposed 
base flood elevations are technically incorrect due to a mathematical or 
measurement error or changed physical conditions, then the specific 
source of the error must be identified. Supporting data must be 
furnished to FEMA including

[[Page 351]]

certifications by a registered professional engineer or licensed land 
surveyor, of the new data necessary for FEMA to conduct a reanalysis.
    (2) If an appellant believes that the proposed base flood elevations 
are technically incorrect due to error in application of hydrologic, 
hydraulic or other methods or use of inferior data in applying such 
methods, the appeal must demonstrate technical incorrectness by:
    (i) Identifying the purported error in the application or the 
inferior data.
    (ii) Supporting why the application is incorrect or data is 
inferior.
    (iii) Providing an application of the same basic methods utilized by 
FEMA but with the changes itemized.
    (iv) Providing background technical support for the changes 
indicating why the appellant's application should be accepted as more 
correct.
    (v) Providing certification of correctness of any alternate data 
utilized or measurements made (such as topographic information) by a 
registered professional engineer or licensed land surveyor, and
    (vi) Providing documentation of all locations where the appellant's 
base flood elevations are different from FEMA's.
    (3) If any appellant believes the proposed base flood elevations are 
scientifically incorrect, the appeal must demonstrate scientific 
incorrectness by:
    (i) Identifying the methods, or assumptions purported to be 
scientifically incorrect.
    (ii) Supporting why the methods, or assumptions are scientifically 
incorrect.
    (iii) Providing an alternative analysis utilizing methods, or 
assumptions purported to be correct.
    (iv) Providing technical support indicating why the appellant's 
methods should be accepted as more correct and
    (v) Providing documentation of all locations where the appellant's 
base flood elevations are different from FEMA's.

[48 FR 31644, July 1, 1983]



Sec. 67.7  Collection of appeal data.

    (a) Appeals by private persons to the CEO shall be submitted within 
ninety (90) days following the second newspaper publication of the 
Administrator's proposed flood elevation determination to the CEO or to 
such agency as he may publicly designate and shall set forth scientific 
or technical data that tend to negate or contradict the Administrator's 
findings.
    (b) Copies of all individual appeals received by the CEO shall be 
forwarded, as soon as they are received, to the Administrator for 
information and placement in the Flood Elevation Determination Docket.
    (c) The CEO shall review and consolidate all appeals by private 
persons and issue a written opinion stating whether the evidence 
presented is sufficient to justify an appeal on behalf of such persons 
by the community in its own name.
    (d) The decision issued by the CEO on the basis of his review, on 
whether an appeal by the community in its own name shall be made, shall 
be filed with the Administrator not later than ninety days after the 
date of the second newspaper publication of the Administrator's proposed 
flood elevation determination and shall be placed in the FEDD.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 67.8  Appeal procedure.

    (a) If a community appeals the proposed flood elevation 
determination, the Administrator shall review and take fully into 
account any technical or scientific data submitted by the community that 
tend to negate or contradict the information upon which his/her proposed 
determination is based.
    (b) The Administrator shall resolve such appeal by consultation with 
officials of the local government, or by administrative hearings under 
the procedures set forth in part 68 of this subchapter, or by submission 
of the conflicting data to an independent scientific body or appropriate 
Federal agency for advice.
    (c) The final determination by the Administrator where an appeal is 
filed shall be made within a reasonable time.
    (d) Nothing in this section shall be considered to compromise an 
appellant's rights granted under Sec. 67.12.

[[Page 352]]

    (e) The Administrator shall make available for public inspection the 
reports and other information used in making the final determination. 
This material shall be admissible in a court of law in the event the 
community seeks judicial review in accordance with Sec. 67.12.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 67.9  Final determination in the absence of an appeal by the community.

    (a) If the Administrator does not receive an appeal from the 
community within the ninety days provided, he shall consolidate and 
review on their own merits the individual appeals which, in accordance 
with Sec. 67.7 are filed within the community and forwarded by the CEO.
    (b) The final determination shall be made pursuant to the procedures 
in Sec. 67.8 and, modifications shall be made of his proposed 
determination as may be appropriate, taking into account the written 
opinion, if any, issued by the community in not supporting such appeals.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]



Sec. 67.10  Rates during pendency of final determination.

    (a) Until such time as a final determination is made and proper 
notice is given, no person within a participating community shall be 
denied the right to purchase flood insurance at the subsidized rate.
    (b) After the final determination and upon the effective date of a 
FIRM, risk premium rates will be charged for new construction and 
substantial improvements. The effective date of a FIRM shall begin not 
later than six months after the final flood elevation determination.



Sec. 67.11  Notice of final determination.

    The Administrator's notice of the final flood elevation 
determination for a community shall be in written form and published in 
the Federal Register, and copies shall be sent to the CEO, all 
individual appellants and the State Coordinating Agency.

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984]

    Editorial Note: For the list of communities issued under this 
section, and not carried in the CFR, see the List of CFR Sections 
Affected appearing in the Finding Aids section of this volume.



Sec. 67.12  Appeal to District Court.

    (a) An appellant aggrieved by the final determination of the 
Administrator may appeal such determination only to the United States 
District Court for the District within which the community is located 
within sixty days after receipt of notice of determination.
    (b) During the pendency of any such litigation, all final 
determinations of the Administrator shall be effective for the purposes 
of this title unless stayed by the court for good cause shown.
    (c) The scope of review of the appellate court shall be in 
accordance with the provisions of 5 U.S.C. 706, as modified by 42 U.S.C. 
4104(b).

[41 FR 46989, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544 and 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 
1984; 49 FR 33879, Aug. 27, 1984]



PART 68--ADMINISTRATIVE HEARING PROCEDURES--Table of Contents




Sec.
68.1  Purpose of part.
68.2  Definitions.
68.3  Right to administrative hearings.
68.4  Hearing board.
68.5  Establishment of a docket.
68.6  Time and place of hearing.
68.7  Conduct of hearings.
68.8  Scope of review.
68.9  Admissible evidence.
68.10  Burden of proof.
68.11  Determination.
68.12  Relief.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.

    Source: 47 FR 23449, May 29, 1982, unless otherwise noted.

[[Page 353]]



Sec. 68.1  Purpose of part.

    The purpose of this part is to establish procedures for appeals of 
the Administrator's base flood elevation determinations, whether 
proposed pursuant to section 1363(e) of the Act (42 U.S.C. 4104) or 
modified because of changed conditions or newly acquired scientific and 
technical information.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.3  Right to administrative hearings.

    If a community appeals the Administrator's flood elevation 
determination established pursuant to Sec. 67.8 of this subchapter, and 
the Administrator has determined that such appeal cannot be resolved by 
consultation with officials of the community or by submitting the 
conflicting data to an independent scientific body or appropriate 
Federal agency for advice, the Administrator shall hold an 
administrative hearing to resolve the appeal.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.4  Hearing board.

    (a) Each hearing shall be conducted by a three member hearing board 
(hereinafter ``board''). The board shall consist of a hearing officer 
(hereinafter ``Judge'') appointed by the Director based upon a 
recommendation by the Office of Personnel Management and two members 
selected by the Judge who are qualified in the technical field of flood 
elevation determinations. The Judge shall consult with anyone he deems 
appropriate to determine the technical qualifications of individuals 
being considered for appointment to the board. The board members shall 
not be FEMA employees.
    (b) The Judge shall be responsible for conducting the hearing, and 
shall make all procedural rulings during the course of the hearing. Any 
formal orders and the final decision on the merits of the hearing shall 
be made by a majority of the board. A dissenting member may submit a 
separate opinion for the record.
    (c) A technically qualified alternate will be appointed by the Judge 
as a member of the board when a technically qualified appointed member 
becomes unavailable. The Director will appoint an alternate Judge if the 
appointed Judge becomes unavailable.



Sec. 68.5  Establishment of a docket.

    The General Counsel shall establish a docket for appeals referred to 
him/her by the Administrator for administrative hearings. This docket 
shall include, for each appeal, copies of all materials contained in the 
flood elevation determination docket (FEDD) file on the matter, copies 
of all correspondence in connection with the appeal, all motions, 
orders, statements, and other legal documents, a transcript of the 
hearing, and the board's final determination.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.6  Time and place of hearing.

    (a) The time and place of each hearing shall be designated by the 
Judge for that hearing. The Administrator and the General Counsel shall 
be promptly advised of such designations.
    (b) The board's notice of the time and place of hearing shall be 
sent by the Flood Insurance Docket Clerk by registered or certified 
mail, return receipt requested, to all appellants. Such notice shall 
include a statement indicating the nature of the proceedings and their 
purpose and all appellants' entitlement to counsel. Notice of the 
hearing shall be sent no later than 30 days before the date of hearing 
unless such period is waived by all appellants.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.7  Conduct of hearings.

    (a) The Judge shall be responsible for the fair and expeditious 
conduct of proceedings.
    (b) The Administrator shall be represented by the General Counsel or 
his/her designee.

[[Page 354]]

    (c) One administrative hearing shall be held for any one community 
unless the Administrator for good cause shown grants a separate hearing 
or hearings.
    (d) The Chief Executive Officer (CEO) of the community or his/her 
designee shall represent all appellants from that community; Provided, 
That any appellant may petition the board to allow such appellant to 
make an appearance on his/her own behalf. Such a petition shall be 
granted only upon a showing of good cause.
    (e) Hearings shall be open to the public.
    (f) A verbatim transcript will be made of the hearing. An appellant 
may order copies of the transcribed verbatim record directly from the 
reporter and will be responsible for payments.

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.8  Scope of review.

    Review at administrative hearings shall be limited to: An 
examination of any information presented by each appellant within the 90 
day appeal period indicating that elevations proposed by the 
Administrator are scientifically or technically incorrect; the FIRM; the 
flood insurance study; its backup data and the references used in 
development of the flood insurance study; and responses by FEMA to the 
issues raised by the appellant(s).

[47 FR 23449, May 29, 1982, as amended at 49 FR 33879, Aug. 27, 1984]



Sec. 68.9  Admissible evidence.

    (a) Legal rules of evidence shall not be in effect at adminstrative 
hearings. However, only evidence relevant to issues within the scope of 
review under Sec. 68.8 shall be admissible.
    (b) Documentary and oral evidence shall be admissible.
    (c) Admissibility of non-expert testimony shall be within the 
discretion of the board.
    (d) All testimony shall be under oath.
    (e) Res judicata/ collateral estoppel. Where there has been a 
previous determination, decision or finding of fact by the Director, one 
of his delegees, an administrative law judge, hearing officer, or 
hearing board regarding the base flood elevations of any other 
community, such determination, decision, or finding of fact shall not be 
binding on the board and may only be admissible into evidence if 
relevant.



Sec. 68.10  Burden of proof.

    The burden shall be on appellant(s) to prove that the flood 
elevation determination is not scientifically or technically correct.



Sec. 68.11  Determination.

    The board shall render its written decision within 45 days after the 
conclusion of the hearing. The entire record of the hearing including 
the board's decision will be sent to the Director for review and 
approval. The Director shall make the final base flood elevation 
determination by accepting in whole or in part or by rejecting the 
board's decision.



Sec. 68.12  Relief.

    The final determination may be appealed by the appellant(s) to the 
United States district court as provided in section 1363(f) of the Act 
(42 U.S.C. 4104).



PART 69  [RESERVED]






PART 70--PROCEDURE FOR MAP CORRECTION--Table of Contents




       Mapping Deficiencies Unrelated to Community-Wide Elevation 
                             Determinations

Sec.
70.1  Purpose of part.
70.2  Definitions.
70.3  Right to submit technical information.
70.4  Review by the Director.
70.5  Letter of Map Amendment.
70.6  Distribution of Letter of Map Amendment.
70.7  Notice of Letter of Map Amendment.
70.8  Premium refund after Letter of Map Amendment.
70.9  Review of proposed projects.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 
CFR, 1979 Comp., p. 376.

[[Page 355]]

       Mapping Deficiencies Unrelated to Community-Wide Elevation 
                             Determinations



Sec. 70.1  Purpose of part.

    The purpose of this part is to provide an administrative procedure 
whereby the Director will review the scientific or technical submissions 
of an owner or lessee of property who believes his property has been 
inadvertently included in designated A, AO, A1-30, AE, AH, A99, AR, AR/
A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, and V Zones, as a 
result of the transposition of the curvilinear line to either street or 
to other readily identifiable features. The necessity for this part is 
due in part to the technical difficulty of accurately delineating the 
curvilinear line on either a Flood Hazard Boundary Map or Flood 
Insurance Rate Map. These procedures shall not apply when there has been 
any alteration of topography since the effective date of the first 
National Flood Insurance Program map (i.e., Flood Hazard Boundary Map or 
Flood Insurance Rate Map) showing the property within an area of special 
flood hazard. Appeals in such circumstances are subject to the 
provisions of part 65 of this subchapter.

[59 FR 53600, Oct. 25, 1994]



Sec. 70.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 70.3  Right to submit technical information.

    (a) Any owner or lessee of property (applicant) who believes his 
property has been inadvertently included in a designated A, AO, A1-30, 
AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, and 
V Zones on a Flood Hazard Boundary Map or a Flood Insurance Rate Map, 
may submit scientific or technical information to the Director for the 
Director's review.
    (b) Scientific and technical information for the purpose of this 
part may include, but is not limited to the following:
    (1) An actual copy of the recorded plat map bearing the seal of the 
appropriate recordation official (e.g. County Clerk, or Recorder of 
Deeds) indicating the official recordation and proper citation (Deed or 
Plat Book Volume and Page Numbers), or an equivalent identification 
where annotation of the deed or plat book is not the practice.
    (2) A topographical map showing (i) ground elevation contours in 
relation to the National Geodetic Vertical Datum (NVGD) of 1929, (ii) 
the total area of the property in question, (iii) the location of the 
structure or structures located on the property in question, (iv) the 
elevation of the lowest adjacent grade to a structure or structures and 
(v) an indication of the curvilinear line which represents the area 
subject to inundation by a base flood. The curvilinear line should be 
based upon information provided by any appropriate authoritative source, 
such as a Federal Agency, the appropriate state agency (e.g. Department 
of Water Resources), a County Water Control District, a County or City 
Engineer, a Federal Emergency Management Agency Flood Insurance Study, 
or a determination by a Registered Professional Engineer;
    (3) A copy of the FHBM or FIRM indicating the location of the 
property in question;
    (4) A certification by a Registered Professional Engineer or 
Licensed Land Surveyor that the lowest grade adjacent to the structure 
is above the base flood elevation.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544 and 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 
1984; 50 FR 36028, Sept. 4, 1985; 51 FR 30317, Aug. 25, 1986; 53 FR 
16280, May 6, 1988; 59 FR 53601, Oct. 25, 1994]



Sec. 70.4  Review by the Director.

    The Administrator, after reviewing the scientific or technical 
information submitted under the provisions of Sec. 70.3, shall notify 
the applicant in writing of his/her determination within 60 days from 
the date of receipt of the applicant's scientific or technical 
information that either the ground elevations of an entire legally 
defined parcel of land or the elevation of the lowest adjacent grade to 
a structure have been

[[Page 356]]

compared with the elevation of the base flood and that:
    (a) The property is within a designated A, AO, A1-30, AE, AH, A99, 
AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, VE, or V Zone, and 
shall set forth the basis of such determination; or
    (b) The property should not be included within a designated A, AO, 
A1-30, AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, VO, V1-30, 
VE, or V Zone and that the Flood Hazard Boundary Map or Flood Insurance 
Rate Map will be modified accordingly; or
    (c) An additional 60 days is required to make a determination.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 50 
FR 36028, Sept. 4, 1985; 51 FR 30317, Aug. 25, 1986; 59 FR 53601, Oct. 
25, 1994]



Sec. 70.5  Letter of Map Amendment.

    Upon determining from available scientific or technical information 
that a FHBM or a FIRM requires modification under the provisions of 
Sec. 70.4(b), the Administrator shall issue a Letter of Map Amendment 
which shall state:
    (a) The name of the Community to which the map to be amended was 
issued;
    (b) The number of the map;
    (c) The identification of the property to be excluded from a 
designated A, AO, A1-30, AE, AH, A99, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, 
AR/A, VO, V1-30, VE, or V Zone.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 50 
FR 36028, Sept. 4, 1985; 59 FR 53601, Oct. 25, 1994]



Sec. 70.6  Distribution of Letter of Map Amendment.

    (a) A copy of the Letter of Map Amendment shall be sent to the 
applicant who submitted scientific or technical data to the 
Administrator.
    (b) A copy of the Letter of Map Amendment shall be sent to the local 
map repository with instructions that it be attached to the map which 
the Letter of Map Amendment is amending.
    (c) A copy of the Letter of Map Amendment shall be sent to the map 
repository in the state with instructions that it be attached to the map 
which it is amending.
    (d) A copy of the Letter of Map Amendment will be sent to any 
community or governmental unit that requests such Letter of Map 
Amendment.
    (e) [Reserved]
    (f) A copy of the Letter of Map Amendment will be maintained by the 
Agency in its community case file.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544 and 44553, Sept. 29, 1983; 49 FR 4751, Feb. 8, 
1984]



Sec. 70.7  Notice of Letter of Map Amendment.

    (a) The Administrator, shall not publish a notice in the Federal 
Register that the FIRM for a particular community has been amended by 
letter determination pursuant to this part unless such amendment 
includes alteration or change of base flood elevations established 
pursuant to part 67. Where no change of base flood elevations has 
occurred, the Letter of Map Amendment provided under Secs. 70.5 and 70.6 
serves to inform the parties affected.

    Editorial Note: For a list of communities issued under this section 
and not carried in the CFR see the List of CFR Sections Affected 
appearing in the Finding Aids Section of this volume.



Sec. 70.8  Premium refund after Letter of Map Amendment.

    A Standard Flood Insurance Policyholder whose property has become 
the subject of a Letter of Map Amendment under this part may cancel the 
policy within the current policy year and receive a premium refund under 
the conditions set forth in Sec. 62.5 of this subchapter.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 70.9  Review of proposed projects.

    An individual who proposes to build one or more structures on a 
portion of property that may be included inadvertently in a Special 
Flood Hazard Area (SFHA) may request FEMA's comments on whether the 
proposed structure(s), if built as proposed, will be in the SFHA. FEMA's 
comments will be issued in the form of a letter,

[[Page 357]]

termed a Conditional Letter of Map Amendment. The data required to 
support such requests are the same as those required for final Letters 
of Map Amendment in accordance with Sec. 70.3, except as-built 
certification is not required and the requests shall be accompanied by 
the appropriate payment, in accordance with 44 CFR part 72. All such 
requests for CLOMAs shall be submitted to the FEMA Regional Office 
servicing the community's geographic area or to the FEMA Headquarters 
Office in Washington, DC.

[62 FR 5736, Feb. 6, 1997]



PART 71--IMPLEMENTATION OF COASTAL BARRIER LEGISLATION--Table of Contents




Sec.
71.1  Purpose of part.
71.2  Definitions.
71.3  Denial of flood insurance.
71.4  Documentation.
71.5  Violations.

    Authority: 42 U.S.C. 4001, et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 
Comp., p. 376; 42 U.S.C. 4028; secs. 9 and 14, Pub. L. 101-591, 42 
U.S.C. 4028(b).

    Source: 48 FR 37039, Aug. 16, 1983, unless otherwise noted.



Sec. 71.1  Purpose of part.

    This part implements section 11 of the Coastal Barrier Resources Act 
(Pub. L. 97-348) and section 9 of the Coastal Barrier Improvement Act of 
1990 (Pub. L. 101-591), as those Acts amend the National Flood Insurance 
Act of 1968 (42 U.S.C. 4001 et seq.).

[48 FR 37039, Aug. 16, 1983, as amended at 57 FR 22661, May 29, 1992]



Sec. 71.2  Definitions.

    (a) Except as otherwise provided in this part, the definitions set 
forth in part 59 of this subchapter are applicable to this part.
    (b) For the purpose of this part, a structure located in an area 
identified as being in the Coastal Barrier Resources System (CBRS) both 
as of October 18, 1982, and as of November 16, 1990, is ``new 
construction'' unless it meets the following criteria:
    (1)(i) A legally valid building permit or equivalent documentation 
was obtained for the construction of such structure prior to October 18, 
1982; and
    (ii) The start of construction (see part 59) took place prior to 
October 18, 1982; or
    (2)(i) A legally valid building permit or equivalent documentation 
was obtained for the construction of such structure prior to October 1, 
1983; and
    (ii) The structure constituted an insurable building, having walls 
and a roof permanently in place no later than October 1, 1983.
    (c) For the purpose of this part, a structure located in an area 
newly identified as being in the CBRS as of November 16, 1990, is ``new 
construction'' unless it meets the following criteria:
    (1) A legally valid building permit or equivalent documentation was 
obtained for the construction of such structure prior to November 16, 
1990; and
    (2) The start of construction (see 44 CFR part 59) took place prior 
to November 16, 1990.
    (d) For the purpose of this part, a structure located in an 
``otherwise protected area'' is ``new construction'' unless it meets the 
following criteria:
    (1)(i) A legally valid building permit or equivalent documentation 
was obtained for the construction of such structure prior to November 
16, 1990; and
    (ii) The start of construction took place prior to November 16, 
1990; or
    (2)(i) A legally valid building permit or equivalent documentation 
was obtained for the construction of such structure prior to November 
16, 1991; and
    (ii) The structure constituted an insurable building, having walls 
and a roof permanently in place, no later than November 16, 1991.
    (e) For the purpose of this part, a structure located in an area 
identified as being in the CBRS both as of October 18, 1982, and as of 
November 16, 1990, is a ``substantial improvement'' if the substantial 
improvement (see 44 CFR part 59) of such structure took place on or 
after October 1, 1983.
    (f) For the purpose of this part, a structure located in an area 
newly identified as being in the CBRS as of

[[Page 358]]

November 16, 1990, is a ``substantial improvement'' if the substantial 
improvement of such structure took place on or after November 16, 1990.
    (g) For the purpose of this part, a structure located in an 
``otherwise protected area'' is a ``substantial improvement'' if the 
substantial improvement of such structure took place after November 16, 
1991.
    (h) For the purpose of this part, a policy of flood insurance means 
a policy issued pursuant to the National Flood Insurance Act of 1968, as 
amended. This includes a policy issued directly by the Federal 
Government as well as by a private sector insurance company under the 
Write Your Own Program as authorized by 44 CFR part 62.
    (i) For the purpose of this part, new policy of flood insurance 
means a policy of flood insurance other than one issued by an insurer 
(Write Your Own insurer or the Federal Government as the direct insurer) 
effective upon the expiration of a prior policy of flood insurance 
issued by the same insurer without any lapse in coverage between these 
two policies.
    (j) For the purpose of this part, new flood insurance coverage means 
a new or renewed policy of flood insurance.
    (k) For the purpose of this part, otherwise protected area means an 
undeveloped coastal barrier within the boundaries of an area established 
under Federal, State, or local law, or held by a qualified organization, 
primarily for wildlife refuge, sanctuary, recreational, or natural 
resource conservation purposes and identified and depicted on the maps 
referred to in section 4(a) of the Coastal Barrier Resources Act, as 
amended by the Coastal Barrier Improvement Act of 1990, as an area that 
is:
    (1) Not within the CBRS and
    (2) In an ``otherwise protected area.''

[48 FR 37039, Aug. 16, 1983, as amended at 49 FR 33879, Aug. 27, 1984; 
57 FR 22661, May 29, 1992]



Sec. 71.3  Denial of flood insurance.

    (a) No new flood insurance coverage may be provided on or after 
October 1, 1983, for any new construction or substantial improvement of 
a structure located in an area identified as being in the CBRS both as 
of October 18, 1982, and as of November 16, 1990.
    (b) No new flood insurance coverage may be provided on or after 
November 16, 1990, for any new construction or substantial improvement 
of a structure located in any area newly identified as being in the CBRS 
as of November 16, 1990.
    (c) No new flood insurance coverage may be provided after November 
16, 1991, for any new construction or substantial improvement of a 
structure which is located in an ``otherwise protected area.''
    (d) Notwithstanding paragraph (c) of this section, new flood 
insurance coverage may be provided for a structure which is newly 
constructed or substantially improved in an ``otherwise protected area'' 
if the building is used in a manner consistent with the purpose for 
which the area is protected.

[57 FR 22662, May 29, 1992]



Sec. 71.4  Documentation.

    (a) In order to obtain a new policy of flood insurance for a 
structure which is located in an area identified as being in the CBRS as 
of November 16, 1990, or in order to obtain a new policy of flood 
insurance after November 16, 1991, for a structure located in an 
``otherwise protected area,'' the owner of the structure must submit the 
documentation described in this section in order to show that such 
structure is eligible to receive flood insurance. However, if the new 
policy of flood insurance is being obtained from an insurer (Write Your 
Own or the Federal Government as direct insurer) that has previously 
obtained the documentation described in this section, the property owner 
need only submit a signed written certification that the structure has 
not been substantially improved since the date of the previous 
documentation.
    (b) The documentation must be submitted along with the application 
for the flood insurance policy.
    (c) For a structure located in an area identified as being in the 
CBRS both as of October 18, 1982, and as of November 16, 1990, where the 
start of construction of the structure took place prior to October 18, 
1982, the documentation shall consist of:

[[Page 359]]

    (1) A legally valid building permit or its equivalent for the 
construction of the structure dated prior to October 18, 1982;
    (i) If the community did not have a building permit system at the 
time the structure was built, a written statement to this effect signed 
by the responsible community official will be accepted in lieu of the 
building permit;
    (ii) If the building permit was lost or destroyed, a written 
statement to this effect signed by the responsible community official 
will be accepted in lieu of the building permit. This statment must also 
include a certification that the official has inspected the structure 
and found no evidence that the structure was not in compliance with the 
building code at the time it was built; and
    (2) A written statement signed by the community official responsible 
for building permits, attesting to the fact that he or she knows of his/
her own knowledge or from official community records, that:
    (i) The start of construction took place prior to October 18, 1982; 
and
    (ii) The structure has not been substantially improved since 
September 30, 1983.
    (d) For a structure located in an area identified as being in the 
CBRS both as of October 18, 1982, and as of November 16, 1990, where the 
start of construction of the structure took place on or after October 
18, 1982, but the structure was completed (walls and roof permanently in 
place) prior to October 1, 1983, the documentation shall consist of:
    (1) A legally valid building permit or its equivalent for the 
construction of the structure dated prior to October 1, 1983;
    (i) If the community did not have a building permit system at the 
time the structure was built, a written statement to this effect signed 
by the responsible community official will be accepted in lieu of the 
building permit;
    (ii) If the building permit was lost or destroyed, a written 
statement to this effect signed by the responsible community official 
will be accepted in lieu of the building permit. This statement must 
also include a certification that the official has inspected the 
structure and found no evidence that the structure was not in compliance 
with the building code at the time it was built; and
    (2) A written statement signed by the community official responsible 
for building permits, attesting to the fact that he or she knows of his/
her own knowledge or from official community records, that:
    (i) The structure constituted an insurable building, having walls 
and a roof permanently in place no later than October 1, 1983; and
    (ii) The structure has not been substantially improved since 
September 30, 1983; and
    (3) A community issued final certificate of occupancy or other use 
permit or equivalent proof certifying the the building was completed 
(walled and roofed) by October 1, 1983.
    (e) For a structure located in an area newly identified as being in 
the CBRS as of November 16, 1990, where the start of construction of the 
structure took place prior to November 16, 1990, the documentation shall 
consist of:
    (1) A legally valid building permit or its equivalent for the 
construction of the structure, dated prior to November 16, 1990.
    (i) If the community did not have a building permit system at the 
time the structure was built, a written statement to this effect signed 
by the responsible community official will be accepted in lieu of the 
building permit;
    (ii) If the building permit was lost or destroyed, a written 
statement to this effect signed by the responsible community official 
will be accepted in lieu of the building permit. This statement must 
also include a certification that the official has inspected the 
structure and found no evidence that the structure was not in compliance 
with the building code at the time it was built; and
    (2) A written statement signed by the community official responsible 
for building permits, attesting to the fact that he or she knows of his 
or her own knowledge or from official community records, that:
    (i) The start of construction took place prior to November 16, 1990; 
and
    (ii) The structure has not been substantially improved since 
November 15, 1990.

[[Page 360]]

    (f) For a structure located in an area identified as an ``otherwise 
protected area'' where the start of construction of the structure took 
place prior to November 16, 1990, the documentation shall consist of:
    (1) A legally valid building permit or its equivalent for the 
construction of the structure, dated prior to November 16, 1990.
    (i) If the community did not have a building permit system at the 
time the structure was built, a written statement to this effect signed 
by the responsible community official will be accepted in lieu of the 
building permit;
    (ii) If the building permit was lost or destroyed, a written 
statement to this effect signed by the responsible community official 
will be accepted in lieu of the building permit. This statement must 
also include a certification that the official has inspected the 
structure and found no evidence that the structure was not in compliance 
with the building code at the time it was built; and
    (2) A written statement signed by the community official responsible 
for building permits, attesting to the fact that he or she knows of his 
or her own knowledge or from official community records, that:
    (i) The start of construction took place prior to November 16, 1990; 
and
    (ii) The structure has not been substantially improved since 
November 16, 1991.
    (g) For a structure located in an area identified as an ``otherwise 
protected area'' where the start of construction of the structure took 
place after November 15, 1990, but construction was completed with the 
walls and a roof permanently in place no later than November 16, 1991, 
the documentation shall consist of:
    (1) A legally valid building permit or its equivalent for the 
construction of the structure, dated prior to November 16, 1991.
    (i) If the community did not have a building permit system at the 
time the structure was built, a written statement to this effect signed 
by the responsible community official will be accepted in lieu of the 
building permit;
    (ii) If the building permit was lost or destroyed, a written 
statement to this effect signed by the responsible community official 
will be accepted in lieu of the building permit. This statement must 
also include a certification that the official has inspected the 
structure and found no evidence that the structure was not in compliance 
with the building code at the time it was built; and
    (2) A statement signed by the community official responsible for 
building permits, attesting to the fact that he or she knows of his or 
her own knowledge or from official community records that:
    (i) The structure constituted an insurable building, having walls 
and a roof permanently in place, no later than November 16, 1991; and
    (ii) The structure has not been substantially improved since 
November 16, 1991; and
    (3) A community issued final certificate of occupancy or other use 
permit or equivalent proof certifying that the building was completed 
(walled and roofed) by November 16, 1991.
    (h) For a structure located in an area identified as an ``otherwise 
protected area'' for which the documentation requirements of neither 
paragraph (f) nor paragraph (g) of this section have been met, the 
documentation shall consist of a written statement from the governmental 
body or qualified organization overseeing the ``otherwise protected 
area'' certifying that the building is used in a manner consistent with 
the purpose for which the area is protected.

(Approved by the Office of Management and Budget under control number 
3067-0120)


[48 FR 37039, Aug. 16, 1983, as amended at 57 FR 22662, May 29, 1992]



Sec. 71.5  Violations.

    (a) Any flood insurance policy which has been issued where the terms 
of this section have not been complied with or is otherwise inconsistent 
with the provisions of this section, is void ab initio and without 
effect.
    (b) Any false statements or false representations of any kind made 
in connection with the requirements of this part may be punishable by 
fine or imprisonment under 18 U.S. Code section 1001.

[[Page 361]]



PART 72--PROCEDURES AND FEES FOR PROCESSING MAP CHANGES--Table of Contents




Sec.
72.1  Purpose of part.
72.2  Definitions.
72.3  Fee schedule.
72.4  Submittal/payment procedures and FEMA response.
72.5  Exemptions.
72.6  Unfavorable response.
72.7  Resubmittals.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 
CFR, 1979 Comp., p. 376.



Sec. 72.1  Purpose of part.

    This part provides administrative and cost-recovery procedures for 
the engineering review and administrative processing associated with 
FEMA's response to requests for Conditional Letters of Map Amendment 
(CLOMAs), Conditional Letters of Map Revision (CLOMRs), Conditional 
Letters of Map Revision Based on Fill (CLOMR-Fs), Letters of Map 
Revision Based on Fill (LOMR-Fs), Letters of Map Revision (LOMRs), and 
Physical Map Revisions (PMRs). Such requests are based on proposed or 
actual manmade alterations within the floodplain, such as the placement 
of fill; modification of a channel; construction or modification of a 
bridge, culvert, levee, or similar measure; or construction of single or 
multiple residential or commercial structures on single or multiple 
lots.

[62 FR 5736, Feb. 6, 1997]



Sec. 72.2  Definitions.

    Except as otherwise provided in this part, the definitions in 44 CFR 
part 59 are applicable to this part. For the purposes of this part, the 
products are defined as follows:
    CLOMA. A CLOMA is FEMA's comment on a proposed structure or group of 
structures that would, upon construction, be located on existing natural 
ground above the base (1-percent-annual-chance) flood elevation on a 
portion of a legally defined parcel of land that is partially inundated 
by the base flood.
    CLOMR. A CLOMR is FEMA's comment on a proposed project that would, 
upon construction, affect the hydrologic or hydraulic characteristics of 
a flooding source and thus result in the modification of the existing 
regulatory floodway, the effective base flood elevations, or the Special 
Flood Hazard Area (SFHA).
    CLOMR-F. A CLOMR-F is FEMA's comment on a proposed project that 
would, upon construction, result in a modification of the SFHA through 
the placement of fill outside the existing regulatory floodway.
    LOMR. A LOMR is FEMA's modification to an effective Flood Insurance 
Rate Map (FIRM), or Flood Boundary and Floodway Map (FBFM), or both. 
LOMRs are generally based on the implementation of physical measures 
that affect the hydrologic or hydraulic characteristics of a flooding 
source and thus result in the modification of the existing regulatory 
floodway, the effective base flood elevations, or the SFHA. The LOMR 
officially revises the FIRM or FBFM, and sometimes the Flood Insurance 
Study (FIS) report, and, when appropriate, includes a description of the 
modifications. The LOMR is generally accompanied by an annotated copy of 
the affected portions of the FIRM, FBFM, or FIS report.
    LOMR-F. A LOMR-F is FEMA's modification of the SFHA shown on the 
FIRM based on the placement of fill outside the existing regulatory 
floodway.
    PMR. A PMR is FEMA's physical revision and republication of an 
effective FIRM, FBFM, or FIS report. PMRs are generally based on 
physical measures that affect the hydrologic or hydraulic 
characteristics of a flooding source and thus result in the modification 
of the existing regulatory floodway, the effective base flood 
elevations, or the SFHA.

[62 FR 5737, Feb. 6, 1997]



Sec. 72.3  Fee schedule.

    (a) For requests for CLOMRs, LOMRs, and PMRs based on structural 
measures on alluvial fans, an initial fee of $5,000, subject to the 
provisions of Sec. 72.4, shall be paid to FEMA before FEMA begins its 
review of the request. The initial fee represents the minimum cost for 
reviewing these requests and is based on the prevailing private-sector 
labor rate. A revision to this initial

[[Page 362]]

fee, if necessary, will be published as a notice in the Federal 
Register.
    (b) For requests for CLOMRs, LOMRs, and PMRs based on structural 
measures on alluvial fans, the total fee will be calculated based on the 
total hours by FEMA to review and process the request multiplied by an 
hourly rate based on the prevailing private-sector labor rate. The 
hourly rate is published as a notice in the Federal Register. A revision 
to the hourly rate, if necessary, shall be published as a notice in the 
Federal Register.
    (c) For conditional and final map revision requests for the 
following categories, flat user fees, subject to the provisions of 
Sec. 72.4, shall be paid to FEMA before FEMA begins its review of the 
request:
    (1) Requests for CLOMAs, CLOMR-Fs, and LOMR-Fs for single structures 
or single lots;
    (2) Requests for CLOMAs for multiple structures or multiple lots;
    (3) Requests for CLOMR-Fs and LOMR-Fs for multiple structures or 
multiple lots;
    (4) Requests LOMR-Fs for single structures or single lots based on 
as-built information for projects for which FEMA issued CLOMR-Fs 
previously;
    (5) Requests for LOMR-Fs for multiple structures or multiple lots 
based on as-built information for projects for which FEMA issued CLOMR-
Fs previously;
    (6) Requests for LOMRs and PMRs based on projects involving bridges, 
culverts, or channels, or combinations thereof;
    (7) Requests for LOMRs and PMRs based on projects involving levees, 
berms, or other structural measures;
    (8) Requests for LOMRs and PMRs based on as-built information for 
projects for which FEMA issued CLOMRs previously, except those based on 
structural measures on alluvial fans;
    (9) Requests for LOMRs and PMRs based solely on more detailed data;
    (10) Requests for CLOMRs based on projects involving new hydrologic 
information, bridges, culverts, or channels, or combinations thereof; 
and
    (11) Requests for CLOMRs based on projects involving levees, berms, 
or other structural measures.
    (d) If a request involves more than one of the categories listed 
above, the highest applicable flat user fee must be submitted.
    (e) The flat user fees for conditional and final map amendments and 
map revisions are based on the actual costs for reviewing and processing 
the requests. The fees for requests for LOMR-Fs, LOMRs, and PMRs also 
include a fee of $35 to cover FEMA's costs for physically revising 
affected FIRM and FBFM panels to reflect the map changes.
    (f) Revisions to the fees, if necessary, shall be published as a 
notice in the Federal Register.

[62 FR 5737, Feb. 6, 1997]



Sec. 72.4  Submittal/payment procedures and FEMA response.

    (a) The initial fee shall be submitted with a request for FEMA 
review and processing of CLOMRs, LOMRs, and PMRs based on structural 
measures on alluvial fans; the appropriate flat user fee shall be 
submitted with all other requests for FEMA review and processing.
    (b) FEMA must receive initial or flat user fees before it will begin 
any review. The fee is non-refundable once FEMA begins its review.
    (c) Following completion of FEMA's review for any CLOMR, LOMR, or 
PMR based on structural measures on alluvial fans, FEMA shall invoice 
the requester at the established hourly rate for any actual costs 
exceeding the initial fee incurred for review and processing. FEMA shall 
not issue a determination letter or revised map panel(s) until it 
receives the invoiced amount.
    (d) For all map revision requests, FEMA shall bear the cost of 
reprinting and distributing the revised FIRM panel(s), FBFM panel(s), or 
combination.
    (e) The entity that applies to FEMA through the local community for 
review is responsible for the cost of the review. The local community 
incurs no financial obligation under the reimbursement procedures of 
this part when another party sends the application to FEMA.
    (f) Requesters shall submit payments by check or money order or by 
credit card. Checks or money orders, in U.S.

[[Page 363]]

funds, shall be made payable to the National Flood Insurance Program.
    (g) For CLOMA, CLOMR-F, LOMA, and LOMR-F requests, FEMA shall:
    (1) Notify the requester and community within 30 days as to the 
adequacy of the submittal, and
    (2) Provide to the requester and the community, within 60 days of 
receipt of adequate information and fee, a determination letter or other 
written comment in response to the request.
    (h) For CLOMR, LOMR, and PMR requests, FEMA shall:
    (1) Notify the requester and community within 60 days as to the 
adequacy of the submittal; and
    (2) Provide to the requester and the community, within 90 days of 
receipt of adequate information and fee, a CLOMR, a LOMR, other written 
comment in response to the request, or preliminary copies of the revised 
FIRM panels, FBFM panels, and/or affected portions of the FIS report for 
review and comment.

[62 FR 5737, Feb. 6, 1997]



Sec. 72.5  Exemptions.

    (a) Requests for map changes based on mapping or study analysis 
errors or the effects of natural changes within SFHAs shall be exempt 
from fees.
    (b) Requests for LOMAs shall be exempt from fees.
    (c) Map change requests based on the following shall be exempt from 
fees:
    (1) Federally sponsored flood-control projects where 50 percent or 
more of the project's costs are federally funded; and
    (2) Detailed hydrologic and hydraulic studies conducted by Federal, 
State, or local agencies to replace approximate studies conducted by 
FEMA and shown on the effective FIRM.

[62 FR 5738, Feb. 6, 1997]



Sec. 72.6  Unfavorable response.

    (a) Requests for CLOMAs, CLOMRs, or CLOMR-Fs may be denied or the 
determinations may contain specific comments, concerns, or conditions 
regarding proposed projects or designs and their impacts on flood 
hazards in a community. Requesters are not entitled to any refund of 
fees paid if the determinations contain such comments, concerns, or 
conditions, or if the requests are denied. Requesters are not entitled 
to any refund of fees paid if the requesters are unable to provide the 
appropriate scientific or technical documentation or to obtain required 
authorizations, permits, financing, etc., for which requesters seek the 
CLOMAs, CLOMRs, or CLOMR-Fs.
    (b) Requests for LOMRs, LOMR-Fs, or PMRs may be denied or the 
revisions to the FIRM, FBFM, or both, may not be in the manner or to the 
extent desired by the requesters. Requesters are not entitled to any 
refund of fees paid if the revision requests are denied or if the LOMRs, 
LOMR-Fs, or PMRs do not revise the map specifically as requested.

[62 FR 5738, Feb. 6, 1997]



Sec. 72.7  Resubmittals.

    (a) Resubmittals of CLOMA, CLOMR, CLOMR-F, LOMR, LOMR-F, or PMR 
requests more than 90 days after FEMA notification that the requests 
were denied or after FEMA ended its review because the requester 
provided insufficient information will be treated as original 
submissions and subject to all submittal/payment procedures described in 
Sec. 72.4. The procedure in Sec. 72.4 also applies to a resubmitted 
request (regardless of when submitted) if the project on which the 
request is based has been altered significantly in design or scope other 
than as necessary to respond to comments, concerns, or other findings 
made by FEMA regarding the original submission.
    (b) When LOMR, LOMR-F, or PMR requests are made after FEMA issues 
CLOMRs or CLOMR-Fs, the procedures in Sec. 72.4 and the appropriate fee 
apply, as referenced in Sec. 72.3(c). When the as-built conditions 
differ from the proposed conditions on which FEMA issued the CLOMRs or 
CLOMR-Fs, the reduced fee for as-built requests will not apply.

[62 FR 5738, Feb. 6, 1997]



PART 73--IMPLEMENTATION OF SECTION 1316 OF THE NATIONAL FLOOD INSURANCE ACT OF 1968--Table of Contents




Sec.
73.1  Purpose of part.

[[Page 364]]

73.2  Definitions.
73.3  Denial of flood insurance coverage.
73.4  Restoration of flood insurance coverage.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.

    Source: 51 FR 30318, Aug. 25, 1986, unless otherwise noted.



Sec. 73.1  Purpose of part.

    This part implements section 1316 of the National Flood Insurance 
Act of 1968.



Sec. 73.2  Definitions.

    (a) Except as otherwise provided in this part, the definitions set 
forth in part 59 of this subchapter are applicable to this part.
    (b) For the purpose of this part a duly constituted State or local 
zoning authority or other authorized public body means an official or 
body authorized under State or local law to declare a structure to be in 
violation of a law, regulation or ordinance.
    (c) For the purpose of this part, State or local laws, regulations 
or ordinances intended to discourage or restrict development or 
occupancy of flood-prone areas are measures such as those defined as 
Flood plain management regulations in Sec. 59.1 of this subchapter. Such 
measures are referred to in this part as State or local flood plain 
management regulations.



Sec. 73.3  Denial of flood insurance coverage.

    (a) No new flood insurance shall be provided for any property which 
the Administrator finds has been declared by a duly constituted State or 
local zoning authority or other authorized public body, to be in 
violation of State or local laws, regulations or ordinances which are 
intended to discourage or otherwise restrict land development or 
occupancy in flood-prone areas.
    (b) New and renewal flood insurance shall be denied to a structure 
upon a finding by the Administrator of a valid declaration of a 
violation.
    (c) States and communities shall determine whether to submit a 
declaration to the Administrator for the denial of insurance.
    (d) A valid declaration shall consist of:
    (1) The name(s) of the property owner(s) and address or legal 
description of the property sufficient to confirm its identity and 
location;
    (2) A clear and unequivocal declaration that the property is in 
violation of a cited State or local law, regulation or ordinance;
    (3) A clear statement that the public body making the declaration 
has authority to do so and a citation to that authority;
    (4) Evidence that the property owner has been provided notice of the 
violation and the prospective denial of insurance; and
    (5) A clear statement that the declaration is being submitted 
pursuant to section 1316 of the National Flood Insurance Act of 1968, as 
amended.



Sec. 73.4  Restoration of flood insurance coverage.

    (a) Insurance availability shall be restored to a property upon a 
finding by the Administrator of a valid rescission of a declaration of a 
violation.
    (b) A valid rescission shall be submitted to the Administrator and 
shall consist of:
    (1) The name of the property owner(s) and an address or legal 
description of the property sufficient to identify the property and to 
enable FEMA to identify the previous declaration;
    (2) A clear and unequivocal statement by an authorized public body 
rescinding the declaration and giving the reason(s) for the rescission;
    (3) A description of and supporting documentation for the measures 
taken in lieu of denial of insurance in order to bring the structure 
into compliance with the local flood plain management regulations; and
    (4) A clear statement that the public body rescinding the 
declaration has the authority to do so and a citation to that authority.



PART 74  [RESERVED]






PART 75--EXEMPTION OF STATE-OWNED PROPERTIES UNDER SELF-INSURANCE PLAN--Table of Contents




                           Subpart A--General

Sec.
75.1  Purpose of part.

[[Page 365]]

75.2  Definitions.
75.3  Burden of proof.

                   Subpart B--Standards for Exemption

75.10  Applicability.
75.11  Standards.
75.12  Application by a State for exemption.
75.13  Review by the Director.
75.14  States exempt under this part.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 3 CFR, 1979 Comp., p. 376.

    Source: 41 FR 46991, Oct. 26, 1976, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.



                           Subpart A--General



Sec. 75.1  Purpose of part.

    The purpose of this part is to establish standards with respect to 
the Director's determinations that a State's plan of self-insurance is 
adequate and satisfactory for the purposes of exempting such State, 
under the provisions of section 102(c) of the Act, from the requirement 
of purchasing flood insurance coverage for State-owned structures and 
their contents in areas identified by the Director as A, AO, AH, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, 
and E Zones, in which the sale of insurance has been made available, and 
to establish the procedures by which a State may request exemption under 
section 102(c).

[59 FR 53601, Oct. 25, 1994]



Sec. 75.2  Definitions.

    The definitions set forth in part 59 of this subchapter are 
applicable to this part.



Sec. 75.3  Burden of proof.

    In any application made by a State to the Administrator for 
certification of its self-insurance plan, the burden of proof shall rest 
upon the State making application to establish that its policy of self-
insurance is adequate and equals or exceeds the standards provided in 
this part.



                   Subpart B--Standards for Exemption



Sec. 75.10  Applicability.

    A State shall be exempt from the requirement to purchase flood 
insurance in respect to State-owned structures and, where applicable, 
their contents located or to be located in areas identified by the 
Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/
A, A99, M, V, VO, V1-30, VE, and E Zones, and in which the sale of flood 
insurance has been made available under the National Flood Insurance Act 
of 1968, as amended, provided that the State has established a plan of 
self-insurance determined by the Director to equal or exceed the 
standards set forth in this subpart.

[59 FR 53601, Oct. 25, 1994]



Sec. 75.11  Standards.

    (a) In order to be exempt under this part, the State's self-
insurance plan shall, as a minimum:
    (1) Constitute a formal policy or plan of self-insurance created by 
statute or regulation authorized pursuant to statute.
    (2) Specify that the hazards covered by the self-insurance plan 
expressly include the flood and flood-related hazards which are covered 
under the Standard Flood Insurance Policy.
    (3) Provide coverage to state-owned structures and their contents 
equal to that which would otherwise be available under a Standard Flood 
Insurance Policy.
    (4) Consist of a self-insurance fund, or a commercial policy of 
insurance or reinsurance, for which provision is made in statute or 
regulation and that is funded by periodic premiums or charges allocated 
for state-owned structures and their contents in areas identified by the 
Director as A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/
A, A99, M, V, VO, V1-30, VE, and E Zones. The person or persons 
responsible for such self-insurance fund shall report on its status to 
the chief executive authority of the State, or to the legislature, or 
both, not less frequently than annually. The loss experience shall be 
shown for each calendar or fiscal year from inception

[[Page 366]]

to current date based upon loss and loss adjustment expense incurred 
during each separate calendar or fiscal year compared to the premiums or 
charges for each of the respective calendar or fiscal years. Such 
incurred losses shall be reported in aggregate by cause of loss under a 
loss coding system adequate, as a minimum, to identify and isolate loss 
caused by flood, mudslide (i.e., mudflow) or flood-related erosion. The 
Director may, subject to the requirements of paragraph (a)(5) of this 
section, accept and approve in lieu of, and as the reasonable equivalent 
of the self-insurance fund, an enforceable commitment of funds by the 
State, the enforceability of which shall be certified to by the State's 
Attorney General, or other principal legal officer. Such funds, or 
enforceable commitment of funds in amounts not less than the limits of 
coverage that would be applicable under Standard Flood Insurance 
Policies, shall be used by the State for the repair or restoration of 
State-owned structures and their contents damaged as a result of flood-
related losses occurring in areas identified by the Director as A, AO, 
AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, 
V1-30, VE, and E Zones.
    (5) Provide for the maintaining and updating by a designated State 
official or agency not less frequently than annually of an inventory of 
all State-owned structures and their contents within A, AO, AH, A1-30, 
AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, 
and E zones. The inventory shall:
    (i) Include the location of individual structures;
    (ii) Include an estimate of the current replacement costs of such 
structures and their contents, or of their current economic value; and
    (iii) Include an estimate of the anticipated annual loss due to 
flood damage.
    (6) Provide the flood loss experience for State-owned structures and 
their contents based upon incurred losses for a period of not less than 
the 5 years immediately preceding application for exemption, and certify 
that such historical information shall be maintained and updated.
    (7) Include, pursuant to Sec. 60.12 of this subchapter, a certified 
copy of the flood plain management regulations setting forth standards 
for State-owned properties within A, AO, AH, A1-30, AE, AR, AR/A1-30, 
AR/AE, AR/AO, AR/AH, AR/A, A99, M, V, VO, V1-30, VE, and E Zones.
    (b) The Administrator shall determine the adequacy of the insurance 
provisions whether they be based on available funds, an enforceable 
commitment of funds, commercial insurance, or some combination thereof, 
but has discretion to waive specific requirements under this part.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 49 
FR 5621, Feb. 14, 1984; 50 FR 36029, Sept. 4, 1985; 59 FR 53601, Oct. 
25, 1994]



Sec. 75.12  Application by a State for exemption.

    Application for exemption made pursuant to this part shall be made 
by the Governor or other duly authorized official of the State 
accompanied by sufficient supporting documentation which certifies that 
the plan of self-insurance upon which the application for exemption is 
based meets or exceeds the standards set forth in Sec. 75.11.



Sec. 75.13  Review by the Director.

    (a) The Administrator may return the application for exemption upon 
finding it incomplete or upon finding that additional information is 
required in order to make a determination as to the adequacy of the 
self-insurance plan.
    (b) Upon determining that the State's plan of self-insurance is 
inadequate, the Administrator shall in writing reject the application 
for exemption and shall state in what respects the plan fails to comply 
with the standards set forth in Sec. 75.11 of this subpart.
    (c) Upon determining that the State's plan of self-insurance equals 
or exceeds the standards set forth in Sec. 75.11 of this subpart, the 
Director shall certify that the State is exempt from the requirement for 
the purchase of flood insurance for State-owned structures and their 
contents located or to be located in areas identified by the Director as

[[Page 367]]

A, AO, AH, A1-30, AE, AR, AR/A1-30, AR/AE, AR/AO, AR/AH, AR/A, A99, M, 
V, VO, V1-30, VE, and E Zones. Such exemption, however, is in all cases 
provisional. The Director shall review the plan for continued compliance 
with the criteria set forth in this part and may request updated 
documentation for the purpose of such review. If the plan is found to be 
inadequate and is not corrected within ninety days from the date that 
such inadequacies were identified, the Director may revoke his 
certification.
    (d) Documentation which cannot reasonably be provided at the time of 
application for exemption shall be submitted within six months of the 
application date. The Administrator may revoke his certification for a 
State's failure to submit adequate documentation after the six month 
period.

[41 FR 46991, Oct. 26, 1976. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 48 FR 44544, Sept. 29, 1983; 49 FR 4751, Feb. 8, 1984; 49 
FR 5621, Feb. 14, 1984; 50 FR 36029, Sept. 4, 1985; 59 FR 53601, Oct. 
25, 1994]



Sec. 75.14  States exempt under this part.

    The following States have submitted applications and adequate 
supporting documentation and have been determined by the Administrator 
to be exempt from the requirement of flood insurance on State-owned 
structures and their contents because they have in effect adequate State 
plans of self-insurance: Florida, Georgia, Iowa, Kentucky, Maine, New 
Jersey, New York, North Carolina, Oregon, Pennsylvania, South Carolina, 
Tennessee, and Vermont.

[48 FR 44544, Sept. 29, 1983, as amended at 57 FR 19542, May 7, 1992]



PART 76  [RESERVED]






PART 77--ACQUISITION OF FLOOD DAMAGED STRUCTURES--Table of Contents




                           General Provisions

Sec.
77.1  Definitions.
77.2  Criteria for acquisition.

    Authority: 42 U.S.C. 4001 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.

                           General Provisions



Sec. 77.1  Definitions.

    (a) Definitions found in Sec. 59.1 of this subchapter are applicable 
to this section.
    (b) Furthermore, the following definitions are established:
    Damaged substantially beyond repair means where (a) damages to the 
improved real property are such that as a condition of repair as imposed 
by a state or local government, the structure must be elevated or 
floodproofed to or above the 100-year flood elevation, or (b) damages to 
the improved real property equals or exceed 50 percent of the 
structure's fair market or actual cash value, whichever is less, or (c) 
where damages to the improved real property are such that repair is 
physically impossible or infeasible.
    Flood risk area See definition for Special Hazard Area in Sec. 59.1, 
or other area subject to flooding as determined by the Administrator.
    Significantly increased construction cost occurs when a specific 
State or local statute, ordinance, or code requires that improvements be 
made to a structure as a condition of the repair of damages sustained, 
such that the actual cost of repair would be greater by 25 percent than 
the cost which would be required for repair of the damages only.
    Sound land management and use The process wherein the governmental 
body responsible for land use regulation in a political jurisdiction 
plans and regulates the use of land within its jurisdiction in order to 
promote the reduction of property exposure to flood hazard and the 
protection of environmental values of flood plains. Sound use of land 
acquired by FEMA and transferred to local governments pursuant to 
section 1362 of Public Law 95-128 is use for primarily open space and 
recreational purposes to minimize potential for any future flood damage, 
with a general prohibition of enclosed structures unless functionally 
dependent for some recreational or open space use. The criteria set 
forth in paragraphs (d)(1) through (4), of Sec. 77.2 and restrictions to 
be placed in deeds used to convey title to real property from the 
Federal Government to local governments will set

[[Page 368]]

forth more specific requirements to be used in determining what 
constitutes sound Land Management and Use for individual land parcels.

[45 FR 50282, July 28, 1980, as amended at 48 FR 44553, Sept. 29, 1983; 
49 FR 4751, Feb. 8, 1984]



Sec. 77.2  Criteria for acquisition.

    (a) The objectives of the Flooded Property Purchase Program under 
the National Flood Insurance Program are:
    (1) To reduce future flood insurance and disaster assistance costs 
by removing repetitively and/or substantially damaged structures from 
flood risk areas;
    (2) To provide an opportunity for owners of repetitively and 
substantially damaged structures to be permanently removed from flood 
risk areas, and to reduce risk to life from flooding; and
    (3) To complement Federal, State and local efforts to restore flood 
plain values, protect the environment and provide recreational and open 
space resources.
    (b) The Administrator will, when he or she deems it to be in the 
public interest, enter into negotiation with property owners whose 
improved real property has been damaged by flooding for the purpose of 
purchasing such buildings and associated land or lot for transfer by 
sale, lease, or donation to a community when the following conditions 
are met:
    (1) The property must be located in a flood risk area as determined 
by the Administrator;
    (2) The property must have been covered by a flood insurance policy 
under the National Flood Insurance Program at the time damage took 
place.
    (3) The building, while covered by flood insurance under the 
National Flood Insurance program, must have been damaged substantially 
beyond repair or must have been damaged not less than three previous 
times during the preceding five year period, each time the cost of 
repair equalling 25 percent or more of the structure's value, or must 
have been damaged from a single casualty of any nature so that a 
statute, ordinance or regulation precludes its repair or restoration or 
permits repair or restoration only at significantly increased cost.
    (4) A State or local community must enter into an agreement 
authorized by ordinance or legally binding resolution to take title to 
and manage the property in a manner consistent with sound land managment 
use as determined by the Administrator.
    (5) The community must agree to remove without cost to the Federal 
Emergency Management Agency (FEMA), by demolition, relocation, donation 
or sale any damaged structures to which the community accepts title from 
FEMA, provided the Administrator may, when it is in the public interest 
to do so, agree to assume a part or all of the cost of such removal.
    (c) Title to the real property acquired by FEMA shall be conveyed to 
local communities subject to specific restrictive covenants, conditions 
and agreements which will run with the land and be binding on subsequent 
successors, grantees and assigns. These restrictive covenants, 
conditions and agreements will be recited in the deed a community 
receives from FEMA and the community shall join in the execution of the 
deed.
    (d) The general criteria from which specific deed restrictions will 
be developed may include, among other things, that:
    (1) The land must be dedicated in perpetuity for open space 
purposes, or such other purposes as the Administrator may agree are 
consistent with the objectives set forth in paragraphs (a)(1) through 
(3) of this section; that the community shall faithfully manage the land 
for its dedicated purposes; that the community shall not erect or permit 
to be erected and structures or other improvements on the land unless 
such structures are, except for restrooms, open on all sides and 
functionally related to a designated open space use without the prior 
approval in writing of the Administrator; and that the community shall 
not permit any use which will create a threat to human life from 
flooding.
    (2) In general, allowable open space uses include parks for outdoor 
recreational activities, nature reserves, cultivation, grazing, camping 
(except where adequate warning time is not

[[Page 369]]

available to allow evacuation), temporary storage in the open of wheeled 
vehicles which are easily movable (except mobile homes), unimproved 
parking lots, buffer zones, or open space areas that are part of Planned 
Unit Developments (PUD's). Structures functionally related to these uses 
are open-sided picnic and camping facilities, kiosks and refreshment 
stands or nonhabitable, elevated or floodproofed service structures 
associated with a marina.
    (3) The rights to enforce the restrictive covenants shall be 
assigned to the Administrator as assignee, together with a declaration 
that any future violation of the restrictive covenants or agreements, 
delivered in writing to the Chief Executive Officer within thirty (30) 
days from the date the Administrator receives actual notice of the 
violation, shall be deemed at the Administrator's option to cause a 
reversion of title to FEMA.
    (4) The property shall be transferred subject to zoning and building 
laws and ordinances; easements, agreements, reservations, covenants and 
restriction of record; any state of facts an accurate survey might show; 
encroachments and variations from the record lines of hedges, retaining 
walls, sidewalks and fences;
    (e) Any structures, as described at paragraph (d)(2) of this 
section, and built in accordance with the deed restrictions shall be 
floodproofed or elevated to withstand the effects of the 500 year or .02 
percent chance flood.
    (f) Appraisals for the determination of compensation for flood 
damaged real property will be undertaken in conformance with the 
``Uniform Appraisal Standards for Federal Land Acquisitions'' published 
by the Inter-agency Land Acquisition Conference, GPO (1973). Appraisals 
will reflect the adjusted (for time) pre-damage fair market value (FMV) 
of the structure and land to the extent that this FMV may have been 
reduced or depressed in the open market as a result of flooding. Actual 
compensation of FMV will be inclusive of any flood insurance claim 
payments made or to be made as a result of the most recent flood event 
to the extent that repairs have not yet been made.
    (g) Agreement to sell real property on the part of owners will be 
completely voluntary. No property owners will be required to sell their 
properties under section 1362.
    (h) Relocation assistance under the Uniform Relocation Assistance 
and Real Property Acquisition Policies Act (42 U.S.C. 4601 et seq.) is 
not available to property owners who sell their properties under section 
1362.

[45 FR 50282, July 28, 1980, as amended at 48 FR 44553, Sept. 29, 1983; 
49 FR 4751, Feb. 8, 1984; 49 FR 33879, Aug. 27, 1984]



PART 78--FLOOD MITIGATION ASSISTANCE--Table of Contents




Sec.
78.1  Purpose.
78.2  Definitions.
78.3  Responsibilities.
78.4  Applicant eligibility.
78.5  Flood Mitigation Plan development.
78.6  Flood Mitigation Plan approval process.
78.7  Grant application procedures.
78.8  Grant funding limitations.
78.9  Planning grant approval process.
78.10  Project grant approval process.
78.11  Minimum project eligibility criteria.
78.12  Eligible types of projects.
78.13  Grant administration.
78.14  Alternative procedures.

    Authority: 42 U.S.C. 4001 et seq.; 42 U.S.C. 4104c, 4104d; 
Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 
329; E.O. 12127 of Mar. 31, 1979, 44 FR 19367, 3 CFR, 1979 Comp., p. 
376.

    Source: 62 FR 13347, Mar. 20, 1997, unless otherwise noted.



Sec. 78.1  Purpose.

    (a) The purpose of this part is to prescribe actions, procedures, 
and requirements for administration of the Flood Mitigation Assistance 
(FMA) program, authorized by Sections 1366 and 1367 of the National 
Flood Insurance Act of 1968, 42 U.S.C. 4104c and 4104d.
    (b) The purpose of FMA is to assist State and local governments in 
funding cost-effective actions that reduce or eliminate the long-term 
risk of flood damage to buildings, manufactured homes, and other 
insurable structures. The long-term goal of FMA is to reduce or 
eliminate claims under the National Flood Insurance Program (NFIP)

[[Page 370]]

through mitigation activities. The program provides cost-shared grants 
for three purposes: Planning Grants to States and communities to assess 
the flood risk and identify actions to reduce that risk; Project Grants 
to execute measures to reduce flood losses; and Technical Assistance 
Grants that States may use to assist communities to develop viable FMA 
applications and implement FMA projects. FMA also outlines a process for 
development and approval of Flood Mitigation Plans.



Sec. 78.2  Definitions.

    (a) Except as otherwise provided in this part, the definitions set 
forth in part 59 of this subchapter are applicable to this part.
    (b) Community means:
    (1) A political subdivision, including any Indian tribe or 
authorized tribal organization or Alaskan native village or authorized 
native organization, that has zoning and building code jurisdiction over 
a particular area having special flood hazards, and is participating in 
the NFIP; or
    (2) A political subdivision of a State, or other authority, that is 
designated to develop and administer a mitigation plan by political 
subdivisions, all of which meet the requirements of paragraph (b)(1) of 
this section.



Sec. 78.3  Responsibilities.

    (a) Federal. The Director will allocate available funds to each FEMA 
Region. The FEMA Regional Director will:
    (1) Allocate Technical Assistance and Planning Grants to each State 
through the annual Cooperative Agreements;
    (2) Approve Flood Mitigation Plans in accordance with Sec. 78.6; and
    (3) Award all FMA project grants, after evaluating applications for 
minimum eligibility criteria and ensuring compliance with applicable 
Federal laws.
    (b) State. The State will serve as grantee through the State Point 
of Contact (POC) designated by the Governor. The POC must have working 
knowledge of NFIP goals and processes and will ensure that FMA is 
coordinated with other mitigation activities at the State level. If a 
Governor chooses not to identify a POC to coordinate the FMA, 
communities may follow alternative procedures as described in 
Sec. 78.14. States will:
    (1) Provide technical assistance to communities to assist them in 
developing applications and implementing approved applications;
    (2) Award planning grants;
    (3) Submit plans to the FEMA Regional Director for approval;
    (4) Evaluate project applications, selecting projects to forward to 
the FEMA Regional Director for final approval; and
    (5) Submit performance and financial reports to FEMA in compliance 
with 44 CFR 13.40 and 13.41.
    (c) Community. The community will:
    (1) Complete and submit applications to the State POC for the 
Planning and Projects Grants;
    (2) Prepare and submit the Flood Mitigation Plan;
    (3) Implement all approved projects;
    (4) Comply with FMA requirements, 44 CFR parts 13 and 14, the grant 
agreement, applicable Federal, State and local laws and regulations (as 
applicable); and
    (5) Account for the appropriate use of grant funds to the State POC.



Sec. 78.4  Applicant eligibility.

    (a) The State is eligible to apply for grants for Technical 
Assistance.
    (b) State agencies and communities are eligible to apply for 
Planning and Project Grants and to act as subgrantee. Communities on 
probation or suspended under 44 CFR part 60 of the NFIP are not 
eligible. To be eligible for Project Grants, an eligible applicant will 
develop, and have approved by the FEMA Regional Director, a Flood 
Mitigation Plan in accordance with Sec. 78.5.



Sec. 78.5  Flood Mitigation Plan development.

    A Flood Mitigation Plan will articulate a comprehensive strategy for 
implementing technically feasible flood mitigation activities for the 
area affected by the plan. At a minimum, plans will include the 
following elements:
    (a) Description of the planning process and public involvement. 
Public involvement may include workshops, public meetings, or public 
hearings.

[[Page 371]]

    (b) Description of the existing flood hazard and identification of 
the flood risk, including estimates of the number and type of structures 
at risk, repetitive loss properties, and the extent of flood depth and 
damage potential.
    (c) The applicant's floodplain management goals for the area covered 
by the plan.
    (d) Identification and evaluation of cost-effective and technically 
feasible mitigation actions considered.
    (e) Presentation of the strategy for reducing flood risks and 
continued compliance with the NFIP, and procedures for ensuring 
implementation, reviewing progress, and recommending revisions to the 
plan.
    (f) Documentation of formal plan adoption by the legal entity 
submitting the plan (e.g., Governor, Mayor, County Executive).



Sec. 78.6  Flood Mitigation Plan approval process.

    The State POC will forward all Flood Mitigation Plans to the FEMA 
Regional Director for approval. The Regional Director will notify the 
State POC of the approval or disapproval of the plan within 120 days 
after submission. If the Regional Director does not approve a mitigation 
plan, the Regional Director will notify the State POC of the reasons for 
non-approval and offer suggestions for improvement.



Sec. 78.7  Grant application procedures.

    States will apply for Technical Assistance and Planning Grants 
through the annual Cooperative Agreement between FEMA and the State. The 
State POC will be notified regarding their available funds for project 
grants each fiscal year. The State may forward project applications to 
FEMA for review at any time.



Sec. 78.8  Grant funding limitations.

    (a) The Director will allocate the available funds for FMA each 
fiscal year. Each State will receive a base amount of $10,000 for 
Planning Grants and $100,000 for Project Grants, with the remaining 
funds distributed based on the number of NFIP policies, repetitive loss 
structures, and other such criteria as the Director may determine in 
furtherance of the disaster resistant community concept.
    (b) A maximum of $1,500,000 may be allocated for Planning Grants 
nationally each fiscal year. A Planning Grant will not be awarded to a 
State or community more than once every 5 years, and an individual 
Planning Grant will not exceed $150,000 to any State agency applicant, 
or $50,000 to any community applicant. The total Planning Grant made in 
any fiscal year to any State, including all communities located in the 
State, will not exceed $300,000.
    (c) A maximum of ten percent of the funds available for Project 
Grants will be allocated to Technical Assistance grants each fiscal 
year.
    (d) The total amount of FMA Project Grant funds provided during any 
5-year period will not exceed $10,000,000 to any State or $3,300,000 to 
any community. The total amount of Project Grant funds provided to any 
State, including all communities located in the State will not exceed 
$20,000,000 during any 5-year period.



Sec. 78.9  Planning grant approval process.

    The State POC will evaluate and approve applications for Planning 
Grants. Funds will be provided only for the flood portion of any 
mitigation plan, and Planning Grants will not be awarded to develop new 
or improved floodplain maps. The performance period for each Planning 
Grant will not exceed 3 years.



Sec. 78.10  Project grant approval process.

    The State POC will solicit applications from eligible applicants, 
review projects for eligibility, and select applications for funding. 
Those project applications will then be forwarded to FEMA for final 
approval. FEMA will provide funding on a project by project basis 
through a supplement to the annual Cooperative Agreement. The FEMA 
Regional Director will notify States regarding the program schedule at 
the beginning of each fiscal year.



Sec. 78.11  Minimum project eligibility criteria.

    The identification of a project or activity in an approved Flood 
Mitigation

[[Page 372]]

Plan does not mean it meets FMA eligibility criteria. Projects must:
    (a) Be cost-effective, not costing more than the anticipated value 
of the reduction in both direct damages and subsequent negative impacts 
to the area if future floods were to occur. Both costs and benefits are 
computed on a net present value basis.
    (b) Be in conformance with 44 CFR part 9, Floodplain Management and 
Protection of Wetlands; Executive Order 12699, Seismic Safety of Federal 
and Federally Assisted or Regulated New Building Construction; 44 CFR 
part 10, Environmental Considerations; and any applicable environmental 
laws and regulations.
    (c) Be technically feasible.
    (d) Be in conformance with the minimum standards of the NFIP 
Floodplain Management Regulations at 44 CFR part 60.
    (e) Be in conformance with the Flood Mitigation Plan; the type of 
project being proposed must be identified in the plan.
    (f) Be located physically in a participating NFIP community that is 
not on probation or must benefit such community directly by reducing 
future flood damages.



Sec. 78.12  Eligible types of projects.

    The following types of projects are eligible for funding through 
FMA, providing they meet all other eligibility criteria.
    (a) Acquisition of insured structures and underlying real property 
in fee simple and easements restricting real property to open space 
uses.
    (b) Relocation of insured structures from acquired or restricted 
real property to non hazard-prone sites.
    (c) Demolition and removal of insured structures on acquired or 
restricted real property.
    (d) Elevation of insured residential structures in accordance with 
44 CFR 60.3.
    (e) Elevation or dry floodproofing of insured non-residential 
structures in accordance with 44 CFR 60.3.
    (f) Other activities that bring an insured structure into compliance 
with the floodplain management requirements at 44 CFR 60.3.
    (g) Minor physical flood mitigation projects that reduce localized 
flooding problems and do not duplicate the flood prevention activities 
of other Federal agencies.
    (h) Beach nourishment activities.



Sec. 78.13  Grant administration.

    (a) FEMA may contribute up to 75 percent of the total eligible costs 
of each grant. At least 25 percent of the total eligible costs will be 
provided from a nonfederal source. Of this amount, not more than one 
half will be provided from in-kind contributions. Allowable costs will 
be governed by OMB Circular A-87 and 44 CFR part 13.
    (b) The grantee must submit performance and financial reports to 
FEMA and must ensure that all subgrantees are aware of their 
responsibilities under 44 CFR parts 13 and 14.
    (c) FEMA will recapture any funds provided to a State or a community 
under FMA and deposit the amounts in the National Flood Mitigation Fund 
if the applicant has not provided the appropriate matching funds, the 
approved project has not been completed within the timeframes specified 
in the grant agreement, or the completed project does not meet the 
criteria specified in the regulations in this part.



Sec. 78.14  Alternative procedures.

    For the purposes of this part, alternative procedures are available 
which allow the community to coordinate directly with FEMA in 
implementing the program. These alternative procedures are available in 
the following circumstances. Native American tribes or authorized tribal 
organizations may submit plans and applications to the State POC or 
directly to the FEMA Regional Director. If a Governor chooses not to 
identify a POC to coordinate the FMA, communities may also submit plans 
and applications to the FEMA Regional Director.



PART 79 [RESERVED]




[[Page 373]]

                     Federal Crime Insurance Program



PART 80--DESCRIPTION OF PROGRAM AND OFFER TO AGENTS--Table of Contents




Sec.
80.1  Definitions.
80.2  Description of program.
80.3  Operation of program and inapplicability of State laws.
80.4  Offer to pay commissions to State licensed property insurance 
          agents and brokers for submitting applications on behalf of 
          purchasers for Federal crime insurance.
80.5  Duties of servicing companies.
80.6  Name and address of invoicing company.

    Authority: 12 U.S.C. 1749bbb et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.



Sec. 80.1  Definitions.

    (a) As used in this subchapter and in the crime insurance policies 
issued by the Federal Insurance Administrator, unless otherwise defined 
in the text of such policies--
    (1) [Reserved]
    (2) Adjuster means any person engaged in the business of adjusting 
loss claims arising under property insurance policies issued by an 
insurance company. The term also includes the staff adjusters of 
servicing companies;
    (3) Affordable rate means such premium rate as the Director 
determines would permit the purchase of a specific type of insurance 
coverage by a reasonably prudent person in similar circumstances with 
due regard to the costs and benefits involved. For the purposes of the 
sale of Federal crime insurance, the rates set forth in part 83 of this 
chapter shall be deemed affordable;
    (4) Agent or broker means any person authorized to engage in the 
property insurance business as an agent or broker under the laws of any 
State;
    (5) Crime insurance means insurance against losses resulting from 
robbery, burglary, larceny, and similar crimes, as more specifically 
defined and limited in part 83 of this chapter and in the various crime 
insurance policies issued by the insurer. The term does not include 
automobile insurance or losses resulting from embezzlement;
    (6) Discounts. The premium credit issued to a residential or 
business insured protected by a burglar alarm system, or other 
protective devices or methods used to mitigate losses and considered 
adequate by the Administrator for the type of risk involved, such as 
protective armored car services.
    (7) Deductible means the fixed amount or percentage of any loss not 
covered by an insurance policy. The amount of the deductible must be 
exceeded before insurance coverage takes effect;
    (8) Eligible premises means a property eligible for crime insurance 
coverage under one or more of the types of policies described in part 83 
of this chapter;
    (9) Insurance company means any property insurance company, or group 
of companies, authorized to engage in the insurance business under the 
laws of any State;
    (10) Insurer means the Federal Insurance Administrator, Federal 
Emergency Management Agency, Washington, DC.
    (11) Policyholder premium means the total insurance premium payable 
by the insured for the coverage or coverages provided under any 
insurance policy;
    (12) Program means the Federal crime insurance program authorized by 
title VI of the Housing and Urban Development Act of 1970 (Pub. L. 91-
609, December 31, 1970), set forth principally in 12 U.S.C. 1749bbb-10a, 
et seq.;
    (13) Protective device means any structural, mechanical, electrical, 
chemical, or other physical obstacle or device that can be utilized by a 
property owner to prevent or deter crime or to minimize losses;
    (14) Protective measure means any protective device or other measure 
or procedure employed to prevent or deter crime or to minimize losses; 
and
    (15) Servicing company means an insurance company or other 
organization that has entered into an agreement with the insurer to 
issue and service Federal crime insurance policies on the insurer's 
behalf in one or more States or areas eligible for the sale of such 
insurance.
    (16) Act means the Urban Property Protection and Reinsurance Act of 
1968, codified as title XII of the National Housing Act (12 U.S.C. 
1749bbb-

[[Page 374]]

1749bbb-21), which authorized the program. Section references are to the 
National Housing Act;
    (17) Administrator means the Federal Insurance Administrator within 
the Federal Emergency Management Agency, to whom the Director has 
delegated the administration of the program.
    (18) Binder means a temporary and preliminary contract of insurance 
to protect owner against loss from the occurrence of an insurable event 
before a policy is issued;
    (19) Person includes any individual, group of individuals, 
corporation, partnership, association, or any other organized group of 
persons;
    (20) Property owner or owner, with respect to any real property, 
personal property, or mixed real and personal property, means any person 
having an insurable interest in such property;
    (21) Director means the Director of the Federal Emergency Management 
Agency;
    (22) State means the several States, the District of Columbia, the 
Commonwealth of Puerto Rico, the territories and possessions, and the 
Trust Territory of the Pacific Islands;
    (23) State insurance authority means the person having legal 
responsibility for regulating the business of insurance within a State.
    (24) Vacant Property means a property ``without contents'', that is, 
a premises from which all personal property has been removed.
    (b) Technical or trade terms used in this subchapter or in the crime 
insurance policies issued by the Federal Insurance Administrator and not 
otherwise defined therein shall be deemed to have the most general 
meaning they have in the standard crime insurance policies providing 
similar coverages issued by private insurance companies.

[36 FR 24769, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 13150, Mar. 29, 1982; 50 FR 16494, Apr. 26, 1985; 51 
FR 34605, Sept. 30, 1986; 53 FR 11276, Apr. 6, 1988; 54 FR 31681, Aug. 
1, 1989]



Sec. 80.2  Description of program.

    (a) Title VI of the Housing and Urban Development Act of 1970 (Pub. 
L. 91-609, approved December 31, 1970) authorizes the Director of the 
Federal Emergency Management Agency on and after August 1, 1971, to make 
crime insurance available at affordable rates in any State in which a 
critical market unavailability situation for crime insurance exists that 
has not been met through appropriate State action. The Director is 
directed to conduct a continuing review of the market availability 
situation in each of the several States to determine whether crime 
insurance is available at affordable rates either through the normal 
insurance market or through a suitable program adopted under State law. 
The Director's basic authority under this title has been delegated to 
the Federal Insurance Administrator.
    (b) The purpose of the delayed effective date for the Federal 
program is to give the private property insurance industry and the State 
insurance authorities an opportunity to solve the crime insurance 
unavailability problem through the establishment of appropriate programs 
under the authority of State law. Where adequate State solutions to the 
price and market problems are adopted, Federal crime insurance will not 
be sold.
    (c) In States where the sale of Federal crime insurance is 
undertaken, policies will initially be sold primarily through agents and 
brokers licensed to engage in the insurance business within the State 
for which the policy is written. Policies may also be purchased from the 
appropriate servicing company.
    (d) Lists of States designated as eligible for the sale of Federal 
crime insurance will be published from time to time in Sec. 81.1 of this 
chapter, subject to periodic revisions pursuant to determinations by the 
Federal Insurance Administrator that a critical crime insurance market 
unavailability or prohibitive cost situation exists in a particular 
State, or that the standard lines of crime insurance have become 
available at affordable rates either through a suitable State program or 
through the private insurance market.



Sec. 80.3  Operation of program and inapplicability of State laws.

    (a) The crime insurance program authorized by the Act is a direct 
Federal program, and its operations, receipts, and funds are exempt from 
any form of

[[Page 375]]

Federal, State, or local taxation in accordance with section 1250 of the 
Act (12 U.S.C. 1749bbb-20). In carrying out the program, the 
Administrator is authorized to define terms (sections 1203 (b); 1749bbb-
2(b)), to issue regulations (sections 1247; 1749bbb-17), to establish 
premium rates (sections 1233; 1749bbb-10c), to prescribe terms, 
conditions, and limits of coverage (sections 1231(b); 1749bbb-10a(b)), 
and to make use of the existing facilities and services of insurance 
companies, agents, and brokers as fiscal agents of the United States 
(sections 1232; 1749bbb-10b).
    (b) No Federal crime insurance policy issued by or on behalf of the 
insurer shall be subject to any State or local tax or insurance law or 
regulation, nor shall any agent, broker, or servicing company be subject 
thereto with respect to any monies received or action taken in providing 
insurance to the public under the authority of this subchapter; and no 
insurance policy shall be written by any agent, broker, or servicing 
company in the name or on behalf of the insurer in any form, or on terms 
and conditions, or with limits of coverage, or at premium rates, other 
than those then currently prescribed by the insurer. Failure by any 
insurance company, broker, or agent to comply with this requirement may 
result in the immediate suspension or debarment of the violator from any 
further participation in the program.
    (c) Nothing in this Sec. 80.3 shall be construed as authorizing or 
denying any State or subdivision thereof the right to impose any income 
or other tax on fees, commissions, or profits earned by agents, brokers, 
or servicing companies solely for their own account.



Sec. 80.4  Offer to pay commissions to State licensed property insurance agents and brokers for submitting applications on behalf of purchasers for Federal 
          crime insurance.

    (a) The insurer hereby offers to pay to an eligible State licensed 
property insurance agent or broker a commission in an amount equal to 
the specified percentage of the applicable policyholder premium with 
respect to each Federal crime insurance policy procured for an eligible 
applicant in accordance with the provisions of this subchapter. The 
actual submission of a valid and complete application, together with the 
applicable premium, resulting in the issuance of a policy to an eligible 
insured, all on approved forms and in accordance with the provisions of 
this subchapter, shall be deemed an acceptance of this offer subject to 
avoidance from the inception of the policy in the event of fraud or 
misrepresentation and to cancellation by the insurer (for any of the 
reasons set forth in Sec. 81.7 of this chapter) or by the insured, and 
provided the agent or broker promptly submits the application and 
transmits the gross amount of the policyholder premium then due to the 
insurer and complies with respect to such policy, with any additional 
procedural requirements the insurer may then have imposed. It shall be a 
further condition of this offer that the agent or broker must certify on 
the application that any duties set forth in the application have been 
fully carried out. The amount of the commission shall be prorated in the 
event of the cancellation of any validly issued policy, and the agent or 
broker shall repay to the insurer the amount of any unearned commission 
in excess of the minimum annual commission applicable to the then 
current term of the policy resulting from any such cancellation. 
Premiums must be paid by a check or money order made payable to the 
Federal Crime Insurance Program, and no agent or broker shall cause any 
applicant to make any Federal crime insurance premium payable to anyone 
other than the Federal Crime Insurance Program.
    (b) Commissions earned by eligible agents and brokers under the 
authority of paragraph (a) of this section shall be paid to them in a 
lump sum by the insurer either monthly or on such other equitable basis 
as the insurer may approve.
    (c) Subject to a minimum annual commission of $15 on each commercial 
policy and $5 on each residential policy, the specified commission 
percentage of the policyholder premium for both residential and 
commercial insurance coverages shall be the following: Initial policies 
14% and for all renewal policies 12%. The renewal commission rate shall 
apply to any property that

[[Page 376]]

has previously been insured under the Program unless the lapse of time 
since the termination of the previous policy is in excess of 6 months. 
The commission for any renewal policy shall be deemed payable only to 
the property insurance agent or broker, of record, if any. A change of 
agent or broker made at any time other than on a policy anniversary date 
must be accomplished by the submission of a new application with the 
applicable premium and a request to replace the policy in force.
    (d) No service, placement, or other fee of whatsoever nature shall 
be charged by any agent, broker, or servicing company to any applicant 
or property owner under the Program as a condition of placement or for 
service on an existing policy; nor shall any applicant be compelled to 
purchase any other services or merchandise as a condition for having his 
application submitted. No fee may be collected, retained or shared by 
any agent or broker for the reporting or adjustment of any Federal crime 
insurance claim.
    (e) For the purposes of this offer, an eligible agent or broker 
means an agent or broker who is at the time of making application for 
the policy and at the time of subsequent renewals, licensed and 
authorized to act as a property insurance agent or broker with respect 
to the State where the insured premises are located and who has not been 
suspended or debarred by the insurer. Such agent or broker is the agent 
or broker of the insured and is not an agent of the Federal government 
nor any Federal agency, except as otherwise expressly provided herein. 
An eligible applicant is one whose premises to be insured are located in 
a State then currently designated as eligible for the sale of Federal 
crime insurance in Sec. 81.1 of this chapter.
    (f) Insureds will be billed directly by the insurer for all 
installments (including any servicing fee) and renewal payments, and 
insureds should make payment by check or money order payable to the 
Federal Crime Insurance Program and mail such payment to the insurer and 
not to the agent or broker. But, nevertheless, in the event that an 
insured makes a timely installment payment of the current premium (after 
the initial payment submitted with the application) to any agent or 
broker, proof submitted by the insured, the agent or the broker of the 
timely receipt by the agent or broker may be deemed by the Administrator 
to be proof of timely payment to the insurer so that the insured will 
not be penalized because of an error or omission on the part of the 
agent or broker in forwarding the payment to the insurer.
    (g) Neither this Sec. 80.4 nor any acceptance of this offer shall be 
deemed to confer upon any agent or broker any authority to act for, 
represent, or bind the insurer or the United States except as otherwise 
expressly provided herein.
    (h) Failure of any person to comply with any provision of these 
regulations may result in the immediate suspension or debarment of the 
violator from any further participation in the Program.

[45 FR 41950, June 23, 1980, as amended at 47 FR 19348, May 5, 1982; 52 
FR 30684, Aug. 17, 1987]



Sec. 80.5  Duties of servicing companies.

    (a) The general duties of servicing companies shall be as set forth 
in this Sec. 80.5, subject to the provisions of the actual contracts 
entered into with such companies by the insurer.
    (b) Except as otherwise required by their contracts with the 
insurer, servicing companies shall:
    (1) Provide information to eligible property owners and to 
interested agents and brokers within the servicing area;
    (2) Provide crime insurance manuals to eligble agents and brokers 
within the servicing area;
    (3) Supply application forms and notice and proof of loss forms to 
eligible agents and brokers and to prospective applicants on request;
    (4) Maintain, control, and account for applications for insurance 
received from eligible agents, brokers, and applicants;
    (5) Verify the eligibility of applicants for the coverages sought;
    (6) Issue policies only on forms prescribed and supplied by the 
insurer, or else promptly notify applicants (through the appropriate 
agent or broker, if any) of ineligibility;
    (7) Deposit the applicant's premium check in a special bank account. 
If no

[[Page 377]]

policy is issued, refund the amount of the premium to the applicant.
    (8) Issue periodic commission payment checks to cooperating agents 
and brokers;
    (9) Provide statistical and accounting records, coding, and reports, 
in hard copy and machine-readable forms, as specified in the insurer's 
statistical plan and accounting instructions, and as may be specifically 
requested by the insurer, all in timely fashion;
    (10) Receive, control, and account for all crime insurance claims 
submitted within its servicing area;
    (11) Verify claims data and existence of required protective 
devices, adjust losses as required by insurer through an impartial 
selection of adjusters, and promptly pay all valid claims;
    (12) Bill policyholders directly at least 30 days in advance of due 
dates, and send a copy of each premium or renewal notice to the agent or 
broker of record, if any;
    (13) Periodically obtain updated applications or certifications from 
insureds for verification and incorporation in statistical and 
accounting records.

[36 FR 24769, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 45 FR 41951, June 23, 1980; 54 FR 31681, Aug. 1, 1989]



Sec. 80.6  Name and address of invoicing company.

    The following company has been designated to act as servicing 
company for the Federal Crime Insurance Program, National Con-Serv, Inc. 
Written communications with the servicing company should be addressed 
to: Federal Crime Insurance, P.O. Box 6301, Rockville, MD 20850. The 
toll free telephone number for the servicing company is 800-638-8780 
(policyholder service) and 800-526-2662 (claim inquiries). These numbers 
serve the continental United States, Puerto Rico and the Virgin Islands, 
except Maryland and the Washington Metropolitan Area. In the Washington 
Metropolitan Area call 251-1660. In Maryland, outside the Washington 
Metropolitan Area, call collect 301-251-1660.

[52 FR 30684, Aug. 17, 1987]



PART 81--PURCHASE OF INSURANCE AND ADJUSTMENT OF CLAIMS--Table of Contents




Sec.
81.1  States eligible for the sale of crime insurance.
81.2  Eligibility requirements applicable to property owners.
81.3  Use of prescribed forms required.
81.4  Terms and conditions of policy to govern.
81.5  Where to purchase coverage.
81.6  How to report claims.
81.7  Cancellations, modifications, and renewals of coverage.
81.7a  Cancellations in order to renew.
81.8  Inquiries and complaints.
81.9  Penalties for false statements.
81.10  Nondiscrimination.

    Authority: 12 U.S.C. 1749bbb et seq., Reorganization Plan No. 3 of 
1978, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 
Comp., p. 376.

    Source: 36 FR 24771, Dec. 22, 1971, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.



Sec. 81.1  States eligible for the sale of crime insurance.

    (a) In accordance with section 1231 of the Act (12 U.S.C. 1749bbb-
10a), the Administrator has reviewed the market availability situation 
in each of the several States to determine whether crime insurance is 
available at affordable rates either through the normal insurance market 
or through a suitable program adopted under State law.
    (b)(1) On the basis of the information available, the Federal 
Insurance Administrator has determined that the District of Columbia, 
the Commonwealth of Puerto Rico, the Virgin Islands, and the States set 
forth in this paragraph have an unresolved critical crime insurance 
market unavailability problem requiring the operation of the Federal 
Crime Insurance Program therein as of June 30, 1993.

California
Florida
Illinois
Kansas
Maryland
New Jersey
New York
Pennsylvania
Tennessee
District of Columbia
Puerto Rico
Virgin Islands

    (2) On the basis of the information available, the Federal Insurance 
Administrator has determined that the

[[Page 378]]

District of Columbia, the Commonwealth of Puerto Rico, the Virgin 
Islands and the States set forth in this paragraph have an unresolved 
critical crime insurance market unavailability problem which requires 
the operation of the Federal Crime Insurance Program, therein, as of 
October 1, 1987. Accordingly, the Program is in operation in the 
following jurisdictions, as of October 1, 1987.

Alabama
California
Connecticut
Delaware
Florida
Georgia
Illinois
Kansas
Maryland
New Jersey
New York
Pennsylvania
Rhode Island
Tennessee
District of Columbia
Puerto Rico
Virgin Islands

    (c) If any of the States listed in paragraph (b) of this section, 
after the effective date of this subchapter, adopts a suitable program 
under State law to make the standard lines of crime insurance available 
within that State at affordable rates, or if such insurance becomes 
generally available through the normal insurance market at affordable 
rates, then in either case the eligibility of such State for the 
subsequent sale of crime insurance under the Program will be promptly 
terminated by the insurer.
    (d) Notwithstanding the provisions of Sec. 81.7, Federal Crime 
Insurance policies in-force at the time a State is determined to be no 
longer eligible for further participation in the program shall thereupon 
be terminated upon 30 days written notice to the policyholders effective 
on the expiration date of the policy and no further coverage for such 
policyholders with respect to premises located in such State shall 
thereafter be written unless the State again becomes eligible under the 
program.

[36 FR 24771, Dec. 22, 1971, Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 52 FR 21036, June 4, 1987; 52 FR 30684, Aug. 17, 1987; 57 
FR 11267, Apr. 2, 1992; 58 FR 34920, June 30, 1993]



Sec. 81.2  Eligibility requirements applicable to property owners.

    (a) To be eligible for the purchase of Federal crime insurance under 
the program, a property owner or tenant must:
    (1) Apply separately for coverage for each eligible premises within 
an eligible State and personally sign each application, either on the 
application form itself or on any applicable amendatory endorsement, or 
both, as the insurer may require;
    (2) Pay the annual premium or six-month premium installment at the 
time of application. Coverage will commence in accordance with 
Secs. 83.5 and 83.25a.
    (3) Agree to permit inspections of the insured premises by the 
insurer or his representative at any reasonable time or times; and
    (4) Agree to report to law enforcement authorities all crime losses 
of property covered under each policy, whether or not a claim is filed.
    (b) Failure to comply fully with the requirements of paragraph (a) 
of this section may result in the avoidance, cancellation, or nonrenewal 
of coverage, as set forth in Sec. 81.7.
    (c) Any material misstatement of fact in the application or in any 
form submitted at the time of any subsequent renewal may result in the 
voiding of the policy and the denial of any claim. Intentionally false 
or misleading statements, either in the application, at the time of 
subsequent renewals, or in connection with any claim submitted under 
this program may also result in prosecution.

[36 FR 24771, Dec. 22, 1971, as amended at 43 FR 4008, Jan. 31, 1978. 
Redesignated at 44 FR 31177, May 31, 1979, as amended at 45 FR 41951, 
June 23, 1980; 47 FR 19348, May 5, 1982]



Sec. 81.3  Use of prescribed forms required.

    No Federal crime insurance is authorized to be written under the 
program on any form other than the form prescribed by the insurer for 
the type of coverage involved. Any insurance policy purportedly issued 
on behalf of the insurer or any other form shall not be binding upon the 
insurer and shall not confer any liability upon the insurer by reason of 
any act or representation of the agent, broker, or servicing company in 
illegally causing such policy to be issued.

[[Page 379]]



Sec. 81.4  Terms and conditions of policy to govern.

    (a) Except as otherwise specifically provided by this subchapter, 
the respective rights and duties of the insurer and the insured shall be 
as set forth in the prescribed application form and the prescribed 
policy form. All purchasers of Federal crime insurance shall be deemed 
to have knowledge of the terms and conditions of coverage set forth in 
such policies and in this subchapter. Although the insurer will endeavor 
to provide actual notice of policy changes through the appropriate 
servicing company, modifications of this subchapter that are made during 
the term of an existing policy shall automatically become applicable to 
the policy at the time of its next renewal. All Federal crime insurance 
policies shall be issued for a term of 1 year, subject to semiannual 
premium payments.
    (b) The rights of the insurer to require inspections of the insured 
premises, production of books and records, appraisals of damaged 
property, subrogation in the event of payment, and prompt notice in the 
event of loss, shall be as specified in the prescribed policy, of which 
the application forms a part. The rights of the insured with respect to 
the coverages provided, extensions of coverage outside the insured 
premises or with respect to other persons, limits of such coverages, 
appraisals, cancellations, and judicial review shall be as set forth in 
the prescribed policy.
    (c) Changes in the provisions of this subchapter which broaden or 
liberalize the coverages being provided under the prescribed policy 
forms, but do not require any additional premium to be charged, shall be 
applicable to all existing and future policies of insurance as of the 
date of their adoption, without the necessity of endorsement.

[36 FR 24771, Dec. 22, 1971, as amended at 37 FR 15297, July 29, 1972. 
Redesignated at 44 FR 31177, May 31, 1979, as amended at 47 FR 19348, 
May 5, 1982]



Sec. 81.5  Where to purchase coverage.

    Subject to the provisions of this subchapter, Federal crime 
insurance coverage may be purchased from any property insurance agent or 
broker authorized to do business in the State in which the premises to 
be insured are located, or directly from the appropriate servicing 
company.



Sec. 81.6  How to report claims.

    Losses under a Federal crime insurance policy which exceed the 
applicable deductible may be reported either to the agent or broker 
through whom the application was submitted, or directly to the servicing 
company designated for the area in which the loss occurs. The claimant 
will be required to report all pertinent information, including a 
description of the loss, time, place, ownership, manner of acquisition, 
cost, depreciation, current value, amount of claim, and whether the 
insured has incurred previous losses under the policy. A sworn proof of 
loss statement must be submitted to the adjuster or servicing company 
that processes the claim.



Sec. 81.7  Cancellations, modifications, and renewals of coverage.

    (a) Unless coverage has previously been canceled or renewal is 
refused by the insurer for one or more of the reasons set forth in this 
part, each property owner within an eligible State who is validly 
insured under any policy or policies of insurance issued under the 
Federal crime insurance program shall be entitled to renew (i.e., to 
purchase the then current and applicable form of crime insurance) 
coverage upon the expiration of such existing policy or policies. The 
renewal shall be subject to the rules, regulations, and policy terms, 
conditions, and rates then in effect.
    (b) A renewal notice will be sent by the servicing company to the 
insured at least 30 days prior to the expiration date of each policy. 
Insureds renewing policies shall be furnished with such additional 
forms, if any, as the insurer may require in order to obtain current 
information pertaining to the risk. Any such form must be completed and 
returned by the insured with the premium. The 6-month premium 
installment then due, together with the insured's certification as 
required, must be received by the servicing company not later than the 
expiration date

[[Page 380]]

of the previous policy in order to prevent a lapse in coverage. If 
timely payment is received, no new policy will normally be issued, and 
an eligible insured's check or receipt shall constitute his proof of 
payment. However, if timely payment is not received, or if substantial 
changes have been made in the regulations or provisions governing the 
pertinent crime insurance coverage during the term of the insured's 
previous coverage, a new policy in its entirety may be issued. 
Reinstatement of lapsed policies by servicing companies shall not be 
permitted.
    (c) Changes in coverage or limits of coverage may be made at any 
time upon submission of a new application with the applicable semi-
annual premium. If the ownership of an insured premises is changed, the 
new owner must submit a new application with the applicable semi-annual 
premium. Policy coverage ceases at the time of ownership change and a 
policy may not be transferred or assigned to a new owner or tenant 
except by submission of a new application. Policy coverage ceases at the 
time of any change in the ownership of or insurable interest in the 
premises specified in the application. Upon receipt of information 
indicating that such a change in ownership or insurable interest has 
occurred, the insurer shall issue a notice of cancellation effective the 
date of such change. Return of premium on a cancelled policy shall be on 
a pro rata basis when such cancellation is made for the purpose of 
changing address or coverage or limits of coverage or for purchasing 
crime insurance coverage in the private insurance market. Short-rate 
cancellation procedures shall be applicable to any other cancellation 
during the term of any policy. The insurer may, at the request of the 
insured, permit a retroactive cancellation of a policy, but in no event 
shall such cancellation be effective earlier than thirty days before 
receipt by the insurer of a lost policy release or the original policy, 
and such cancellation shall apply only to the policy in force at the 
time of the receipt of such request.
    (d) Notwithstanding any unqualified cancellation provisions 
contained in the prescribed policy forms, the insurer hereby limits his 
right to cancel, or to refuse to renew coverage, to the following 
grounds:
    (1) Any nonpayment of premium,
    (2) Fraud or misrepresentation in the application or upon any 
renewal of coverage, or in connection with either,
    (3) Fraud or misrepresentation in connection with the submission of 
a claim,
    (4) The use of the insured premises with the knowledge of any 
insured for any illegal activity, or
    (5) Any other substantial failure to comply with the provisions of 
this subchapter or of the insurance policy as determined by the insurer 
and stated in its notice of cancellation. Cancellations or any of the 
grounds in paragraph (d) (2), (3), or (4) of this section may, at the 
discretion of the insurer, be made retroactive to the date of 
application or renewal which immediately precedes the first known 
wrongful act. Refunds of unearned premiums, if any, shall be subject to 
offsets for the insurer's administrative expenses (including the payment 
of agent's commissions, if any) in connection with the issuance of the 
policy, any inspections of the insured's premises and the expense of 
claims adjustment, if any. Cancellations by the insurer on the basis of 
paragraph (d)(5) of this section or as provided by paragraph (e) of this 
section shall be upon 30 days written notice, and the insured shall be 
entitled to a short rate refund of premium, if any.
    (e) Willful or repeated failures of an insured to report to law 
enforcement authorities any losses of property covered under the policy, 
as required by Sec. 81.2(a)(5), may be deemed by the insurer to warrant 
cancellation of coverage upon 30 days' written notice. However, such 
failure may be waived by the insurer prior to cancellation for good 
cause shown.
    (f) No property owner whose Federal insurance coverage has been 
canceled (whether from inception or after notice) or for whom the 
insurer has refused to renew coverage, for any of the reasons in 
paragraph (d) (2), (3), (4), or (5) of this section or under paragraph 
(e) of this section, shall be eligible for any further insurance under 
the program except upon the written waiver of

[[Page 381]]

the Administrator, granted for good cause shown.

[36 FR 24771, Dec. 22, 1971, as amended at 37 FR 15297, July 29, 1972; 
43 FR 4008, Jan. 31, 1978. Redesignated at 44 FR 31177, May 31, 1979, as 
amended at 45 FR 41951, June 23, 1980; 47 FR 19348, May 5, 1982]



Sec. 81.7a  Cancellations in order to renew.

    Notwithstanding the provisions of Sec. 81.7(c), an insured shall not 
be permitted after the effective date of any applicable rate reduction 
to cancel and rewrite an existing crime insurance policy and receive a 
pro rata refund of unearned premium. Further, cancellation and rewrite 
of coverage to avoid an impending rate increase shall not be permitted, 
unless such cancellation was made to accomplish an increase in the 
amount of insurance coverage or as a result of the removal of insured to 
another premises.

[52 FR 30684, Aug. 17, 1987]



Sec. 81.8  Inquiries and complaints.

    (a) Inquiries or complaints about the Federal crime insurance 
program should initially be directed to the property owner's agent or 
broker, or to the servicing company designated for the area in which the 
premises are located.
    (b) Inquiries or complaints with respect to which satisfactory 
information or action cannot be obtained through local sources, and 
general or legal inquiries pertaining to the nature of the program, may 
be addressed to the Federal Insurance Administrator, Federal Emergency 
Management Agency, Washington, DC.

[36 FR 24771, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 13150, Mar. 29, 1982]



Sec. 81.9  Penalties for false statements.

    All information provided by an applicant or a claimant on any form 
approved by the insurer, including representations as to the date on 
which such form is signed, shall be deemed material to the issuance of 
the policy applied for and to the disposition of claims submitted 
thereunder. Any false statement, misrepresentation, or concealment in 
the execution or submission of such forms, or in any writing or document 
knowingly submitted by the applicant or claimant in connection 
therewith, may result in his prosecution by the United States for fraud 
under 18 U.S.C. 1001, subject to a fine of not more than $10,000 or 
imprisonment of not more than 5 years, or both.



Sec. 81.10  Nondiscrimination.

    The Federal Crime Insurance Program and all policies issued or 
serviced thereunder are subject to applicable Federal regulations and 
requirements issued from time to time pursuant thereto. No persons shall 
be excluded from participation in, denied the benefits of, or subjected 
to discrimination under the Program on the grounds of race, color, sex, 
marital status, age or national origin. Any complaint or information 
concerning the existence of any such unlawful discrimination in any 
matter within the purview of this subchapter should be referred to the 
Administrator.

[45 FR 41951, June 23, 1980]



PART 82--PROTECTIVE DEVICE REQUIREMENTS--Table of Contents




                           Subpart A--General

Sec.
82.1  Definitions.
82.2  Purpose of protective device requirements.
82.3  Classification of properties.
82.4  Inspection of residential premises following losses.
82.5  Inspection of commercial premises.

                    Subpart B--Residential Properties

82.21  Minimum standards for residences and apartments.

                  Subpart C--Nonresidential Properties

82.31  Minimum standards for industrial and commercial properties.

    Authority: 12 U.S.C. 1747bbb et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.

    Source: 36 FR 24772, Dec. 22, 1971, unless otherwise noted. 
Redesignated at 44 FR 31177, May 31, 1979.

[[Page 382]]



                           Subpart A--General



Sec. 82.1  Definitions.

    As used in this subchapter, the term--
    (a) Baffle means a piece of metal that covers the opening between a 
door and its frame at the area of penetration of the bolt or latch to 
deter the insertion of tools and prevent the exertion of pressure 
against the bolt or latch;
    (b) Central station, supervised service alarm system means a silent 
alarm system that is professionally installed and is regularly 
maintained, that is constantly in operation, that is equipped with a 
telephone and electricity line security mechanism that activates the 
alarm if either line is cut, and which signals upon any breach of a 
door, window (including storefront windows and unbarred skylights), or 
other accessible opening to the protected premises, at a private sentry 
or guard headquarters that is attended and monitored 24 hours a day, 
that dispatches guards to the protected premises for which they have 
keys immediately upon the activation of the alarm, that periodically 
checks the operation and effectiveness of the system, and that notifies 
law enforcement authorities as soon as a breach of the premises is 
confirmed;
    (c) Central station, supervised alarm system (without guard 
dispatch) means a silent alarm system that is professionally installed 
and is regularly maintained that is constantly in operation, that is 
equipped with a telephone and electricity line security mechanisms that 
activates the alarm if either line is cut, and which signals upon any 
breach of a door, windows (including store front windows and unbarred 
skylights), or other accessible opening to the protected premises, at an 
office of the law enforcement authorities or at an office of an 
independent agency, located at a distance from the protected property, 
which has trained operators continually on duty twenty-four (24) hours a 
day to receive signals and to notify law enforcement authorities as soon 
as any breach of the premises is confirmed;
    (d) Dead bolt means a locking device using a fixed bolt that, when 
in locked position, cannot be retracted by a door knob or handle or 
other normal door opening device or by the application of force against 
the penetrating end of the bolt;
    (e) Dead latch means a locking device, usually spring-operated, that 
incorporates a feature to render the latch rigid in its locked position 
and incapable of release by prying or by the turning of an outside door 
knob or handle or similar door opening device;
    (f) Dead lock means a locking device incorporating a lock that 
cannot be pushed or retracted into a door or window by the use of tools 
inserted between the frame of the door or window and the door or window 
itself. Except as otherwise indicated, a dead lock may be equipped with 
a dead bolt or a dead latch;
    (g) Double cylinder dead bolt lock means a deadbolt lock that can be 
released from its locked position only by a key, whether on the inside 
or the outside of the door;
    (h) Holdup Alarm means a holdup alarm system that is constantly in 
operation and signals at an office of law enforcement authorities or at 
an office of an independent agency located away from the protected 
property. Accessible, but inconspicuous, buttons at hand or foot or knee 
levels are placed throughout the premises. An insured may, at his 
option, cause the alarm to sound on the premises, in addition to the 
remote location.
    (i) Local alarm system means an alarm system that is professionally 
installed and is regularly maintained, that signals loudly at the 
premises by means of one or more tamper-protected sounding devices upon 
any breach of a door, window (including storefront windows and unbarred 
skylights), or other accessible opening to the protected premises;
    (j) Silent alarm system means an alarm system that is professionally 
installed and is regularly maintained, that signals at a local other 
than the location where it is installed upon any breach of a door, 
window (including storefront windows and unbarred skylights, or other 
accessible opening to the protected premises;
    (k) Throw, when used in the context of a locking device, means the 
distance that its bolt or latch protrudes from the body of the device 
when the bolt or latch is in a locked position.

[[Page 383]]

    (l) Safe is a non-portable money storage compartment which is 
reinforced with a minimum of \1/4\ inch solid steel plate throughout, 
with the exception of the door, which must be at least one inch thick 
solid steel plate and equipped with a combination lock, which is an 
integral part of the door.
    (m) Safe or Vault Alarm means a safe or vault protected by a central 
station or silent alarm supervised system.
    (n) Central station, supervised service alarm system that is 
professionally installed and is regularly maintained, and is certified 
by Underwriters Laboratory (U/L) means a silent alarm system that is 
constantly in operation, that is equipped with a telephone and 
electricity line security mechanism that activates the alarm if either 
line is cut, and which signals upon any breach of a door, window 
(including storefront windows and unbarred skylights), or other 
accessible opening to the protected premises, at a private sentry or 
guard headquarters that is attended and monitored 24 hours a day, that 
dispatches guards to the protected premises for which they have keys 
immediately upon the activation of the alarm, that periodically checks 
the operation and effectiveness of the system, and that notifies law 
enforcement authorities as soon as a breach of the premises is 
confirmed.

[36 FR 24772, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 19349, May 5, 1982; 50 FR 16495, Apr. 26, 1985; 53 
FR 11276, Apr. 6, 1988; 55 FR 42189, 42190, Oct. 18, 1990]



Sec. 82.2  Purpose of protective device requirements.

    (a) Section 1231(b) of the Act (12 U.S.C. 1749bbb-10a(b)) provides 
that no Federal crime insurance shall be made available to a property 
which is deemed by the insurer to be uninsurable or to a property with 
respect to which reasonable protective measures to prevent loss, 
consistent with standards established by the insurer, have not been 
adopted.
    (b) It is the intention of the insurer to require at the inception 
of the program only those protective devices generally in use or readily 
available for particular types and classes of properties at the present 
time. As the program progresses, however, the insurer proposes to amend 
these requirements from time to time to enforce a higher and more 
effective standard of protection against ordinary property crimes than 
now exists. Such revised requirements are not expected to be published 
more often than once a year and will be applicable only to crime 
insurance policies issued or renewed after their effective date.
    (c) Protective device standards that impose less-stringent or 
optional alternate requirements upon applicants and insured, as well as 
clarifications of existing standards, may be published at any time and 
shall be applicable both to new policies and to renewals and, at the 
option of the insured, to crime insurance policies already in force.
    (d) As a further control on claims frequency and severity, the 
following minimum protective device requirements apply if the 
policyholder has had 2 or more claims each for a payment of $500 or 
more, in the immediate 3 years preceding the period ending 4 months 
prior to renewal.

                                                                        
------------------------------------------------------------------------
               Premium class                   Protective device code   
------------------------------------------------------------------------
6.........................................  A                           
5.........................................  A                           
4.........................................  C                           
3.........................................  C                           
2.........................................  C                           
1.........................................  N/A                         
------------------------------------------------------------------------

    (e) For those policyholders with no claims in the immediate 3 years 
preceding the period ending 4 months prior to renewal, protective device 
requirements are liberalized as follows:

                                                                        
------------------------------------------------------------------------
               Premium class                   Protective device code   
------------------------------------------------------------------------
6.........................................  C                           
5.........................................  C                           
4.........................................  D                           
3.........................................  E                           
2.........................................  E                           
1.........................................  N/A                         
------------------------------------------------------------------------


[36 FR 24772, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 55 FR 42190, Oct. 18, 1990]



Sec. 82.3  Classification of properties.

    The protective devices required under this part fall into two broad 
categories, residential and commercial. Requirements for residential 
properties

[[Page 384]]

are expected to remain relatively stable and are not likely to vary by 
classes. The protective devices required for commercial and industrial 
properties will vary greatly by the type of risk involved and will be 
changed periodically as experience and knowledge are gained under the 
program and from studies being undertaken by other public and private 
agencies.



Sec. 82.4  Inspection of residential premises following losses.

    (a) Each residential applicant applying for Federal Crime Insurance 
shall be responsible for meeting the protective device requirements 
applicable to his premises. Any person who is doubtful as to whether the 
protective devices existing on his premises at the time of application 
meet such requirements should examine the descriptive materials and 
illustrations available from the servicing company and direct any 
specific questions to the servicing company.
    (b) In addition insurance agents and brokers are expected to assist 
and advise prospective insureds concerning the protective device 
requirements for residential premises. However, no agent or broker shall 
be authorized to approve or disapprove on behalf of the insurer the 
adequacy of any required protective devices, and any representation to 
the contrary is false and shall be void.
    (c) Upon receiving any notice of loss from an insured, the 
Administrator shall cause an inspection of the insured residential 
premises to be made in the course of the adjustment of the claim in 
order to determine whether the premises meets the protective device 
requirements of the program. If no inspection of the premises has 
previously been made and if the first such inspection reveals that the 
insured premises does not comply with the applicable protective device 
requirements, any first loss covered by the terms of the insurance 
policy, involving robbery or a burglary evidenced by visible marks of 
forcible entry, will be paid irrespective of any deficiencies in the 
insured's compliance with the protective device requirements. However, 
the insured will be given thirty days from the date on which he is 
notified in writing of any deficiencies to correct such deficiencies. 
During that thirty day period, robbery or burglary losses covered by the 
terms of the insurance policy will continue to be paid irrespective of 
any deficiencies in the insured's compliance with the protective device 
requirements. Losses occuring more than thirty days after the date on 
which the insured has been notified in writing of the results of the 
inspection will be paid only if it is determined that a loss, covered by 
the terms of the insurance policy, did not result in whole or in part 
from a protective device deficiency of which the insured was previously 
placed on written notice.

[43 FR 4009, Jan. 31, 1978. Redesignated at 44 FR 31177, May 31, 1979]



Sec. 82.5  Inspection of commercial premises.

    (a) All premises for which an application for commercial crime 
insurance against burglary losses is submitted shall be inspected by the 
servicing company to determine whether the premises comply with the 
applicable protective device requirements.
    (b) Coverage under a commercial crime insurance policy indemnifying 
against burglary losses shall not commence unless it is determined that 
the premises sought to be insured complies with all applicable 
protective device requirements. Provided, that all commercial premises 
whose exterior doors and accessible openings are found upon inspection 
to be protected by central station supervised service alarm systems or 
silent alarm systems (as those systems are defined in paragraphs (b), 
(c), (i), (j) and (n) of Sec. 82.1 shall not be required to comply with 
the provisions of paragraphs (b) and (e) of Sec. 82.31 pertaining to the 
protection of those exterior doors and accessible openings by such 
devices as bars, grillwork, and other physical barriers. The benefit of 
this provision, therefore, applies also to commercial premises which, 
because of their particularly high risk inventories of merchandise 
continue to be required by paragraphs (f) (1) and (2) of Sec. 82.31 to 
have exterior doors and accessible openings protected by specific types 
of alarm systems, namely, supervised service alarm systems for the 
highest risk inventories and silent

[[Page 385]]

alarm systems for less high risk inventories.
    (c) An insured whose commercial premises is not one which is 
required by Sec. 82.31 to be protected by any type of alarm system but 
who elects to utilize an alarm system may select particular accessible 
openings and exterior doors to be protected only by the alarm systems 
and may protect other accessible and exterior doors with the physical 
barriers specified in paragraphs (c) and (e) of Sec. 82.31.
    (d) Because the statement of annual gross receipts is a significant 
factor in the determination of the correct premium, the annual gross 
receipts figures (ventas netas for Puerto Rico) or the Total Income of 
the tax returned as derived from interest, rents, capital gains, etc., 
reported on the application or at the time of renewal shall be verified 
at the time of the adjustment of any loss. The applicant or insured 
shall at the time make available any necessary documentation to 
substantiate the annual gross receipts figure reported.
    (e) The Administrator may in his discretion waive one or more 
protective device requirements with respect to any policy where he 
determines that compliance would be impractical and would impose a cost 
not reasonably commensurate with the protection derived. However, in the 
event of any loss contributed to in whole or in part by any such waiver, 
the Administrator may withdraw such waiver upon mailing to the insured 
thirty days written notices of withdrawal. Any loss occurring after 
thirty days from the day of the mailing of said notice shall not be paid 
unless the insured's premises shall be in compliance with the previously 
waived protective device requirement at the time of such loss. The 
Administrator may also in his or her discretion determine that the 
frequency and/or severity of occurrences of loss experienced under any 
policy issued under the provision of paragraphs (b) and (c) of this 
section, requires that as a condition of continuation of coverage on 
renewal such policy the premises insured thereunder be protected by one 
or more of the protective devices described in paragraphs (a), (b), (c), 
(d), (e), (f)(1), (2), (3), and (4) of this section for applicable 
points of entry for incurred losses and also may require as a condition 
of renewal, higher deductibles not to exceed $3,000 for each loss 
occurrence.
    (f) If, during the course of adjusting a claim submitted by an 
insured, an adjuster or other investigator discovers a protective device 
deficiency, not previously discovered and noted by an investigator, with 
respect to a device, described in any of paragraphs (a), (b), (c), (d), 
(e), and (f) of Sec. 82.31, which the insured was required to have 
installed as a condition of eligibility for insurance coverage, the 
deficiency shall be made known to the insured who will be given thirty 
days after his receipt of such written notice within which to remedy the 
deficiency. During that thirty-day period, burglary losses covered by 
the terms of the policy will be paid irrespective of the deficiency. 
Burglary losses occurring more than thirty days after the date on which 
an insured is notified of the deficiency will be paid only if it is 
determined that the deficiency was corrected prior to the loss. However, 
no loss shall be payable at any time if caused in whole or in part by a 
protective device deficiency with respect to any device which the 
insured was required to have installed as a condition of eligibility, 
and which device was found to be present at the time of a previous 
investigation, if the deficiency resulted from the inoperability, 
alteration, removal or disconnection of said required protective device 
by or with the knowledge of the insured, subsequent to the previous 
inspection of the premises.
    (g) An insured who has knowledge of an inoperability or other 
malfunction of a protective device which the insured was required to 
have installed as a condition of eligibility for insurance coverage 
shall immediately notify the Administrator of such deficiency in 
writing, or by use of the servicing company's toll-free telephone number 
800-638-8780. If the insured complies with such emergency protective 
measures as the Administrator may specify following reciept of such 
notice, and if the deficiency is corrected within the time specified by 
the Administrator, no loss of coverage will result during the period of 
inoperability or malfunction.

[[Page 386]]

    (h) If an insured cancels a commercial policy because of a move to a 
new premises and applies for insurance at the new premises, there shall 
be a mandatory inspection to determine compliance with protective device 
requirements at the new location. However, protective device 
requirements shall not be applicable to the new premises until 30 days 
after the insured's receipt of written notice of either compliance or of 
a deficiency, thus giving the insured time in which to remedy the 
deficiency. Burglary losses occurring more than 30 days after the date 
on which the insured received notice of a deficiency will be paid only 
if it is determined that the deficiency was corrected prior to the loss.
    (i) If an applicant occupies a premises jointly with other 
businesses, and there exists no physical barrier separating the business 
of the applicant from the other businesses, the applicant may still 
obtain insurance coverage provided that the exterior boundaries of the 
premises that enclose the business of the applicant and the other 
businesses are protected in accordance with the protective device 
requirements applicable to the classification governing the applicant's 
business. In such a case the applicant, as an insured, will be 
responsible for the continued existence and maintenance and functioning 
of the required protective devices. For purposes of the burglary 
insurance coverage, the premises to which there must be forcible signs 
of entry is the overall premises confining the business of the applicant 
and the other businesses. As noted in Sec. 83.22, the maximum limit of 
coverage which consists of $15,000 may not be increased by insuring 
several departments of a single business or institution at one premises 
as separate premises and this paragraph does not supersede Sec. 83.22.

[43 FR 4008, Jan. 31, 1978. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 19349, May 5, 1982; 50 FR 16495, Apr. 26, 1985; 52 
FR 30685, Aug. 17, 1987; 55 FR 42190, Oct. 18, 1990]



                    Subpart B--Residential Properties



Sec. 82.21  Minimum standards for residences and apartments.

    In order to be eligible for Federal crime insurance, residential 
premises shall meet the following minimum standards:
    (a) Each exterior doorway or doorway leading to garage areas, public 
hallways, terraces, balconies, or other areas affording easy access to 
the insured premises, shall be protected by a door which, if not a 
sliding door, shall be equipped with a dead lock using either an 
interlocking vertical bolt and striker, or a minimum \1/2\-inch throw 
dead bolt, or a minimum \1/2\-inch throw self-locking dead latch.
    (b) All sliding doors, first floor and basement windows, and windows 
opening onto stairways, fire escapes, porches, terraces, balconies, or 
other areas affording easy access to the premises, shall be equipped 
with a locking device of any kind.



                  Subpart C--Nonresidential Properties



Sec. 82.31  Minimum standards for industrial and commercial properties.

    In order to be eligible for Federal crime insurance, a 
nonresidential premises shall meet the following minimum standards:
    (a) Except for doorways that are completely protected during 
nonbusiness hours by heavy duty overhead doors or metal security screens 
or the equivalent, each exterior door shall be equipped with either a 
heavy-duty dead lock (utilizing either interlocking vertical bolts and 
striker or else a 1-inch dead bolt that extends at least one-half inch 
into the frame of the door), or a heavy-duty padlock (with casehardened 
steel shackle and five-pin tumbler operation), or a comparable dead lock 
or padlock that provides equivalent protection. Where applicable fire 
and safety laws permit their use, double-cylinder locks are recommended.
    (b) All exterior grate or grill-type doors, overhead doors, and 
security

[[Page 387]]

screens or grillwork (unless permanently installed) shall be equipped 
with locks that meet the requirements of paragraph (a) of this section.
    (c) Except for doorways that are completely protected during 
nonbusiness hours by heavy-duty overhead doors or metal security screens 
or the equivalent, each exterior door shall be of heavy gauge metal, 
tempered glass, or solid wood core (not less than 1\3/8\ inches thick) 
construction, or else shall be covered with metal sheeting of at least 
16 gauge (\1/16\-inch thick) or its equivalent, or with grillwork, to 
give like protection;
    (d) Outside hinge pins shall be welded, flanged, or screw-secured, 
non-removable pins unless the hinge is constructed so as to provide 
equivalent protection against the removal of the door to which it is 
attached when the door is in the closed position.
    (e) Except where expressly prohibited by applicable laws pertaining 
to fire protection, accessible openings exceeding 96 square inches in 
area and 6 inches in the smallest dimension (other than storefront 
display windows), shall either meet the standards for exterior doors, or 
else shall be protected by inside or outside iron bars one-half inch in 
diameter, or by flat steel material, spaced not more than 5 inches apart 
and securely fastened, or by iron or steel grills of \1/8\-inch material 
of 2-inch mesh, securely fastened, or by other heavy-duty material that 
provides equivalent protection. The requirements of this paragraph shall 
not apply to skylights protected by alarm systems. For the purposes of 
this paragraph, an ``accessible opening'' is an opening such as a 
window, transom, skylight, or vent, regardless of whether it is made to 
be opened, which exceeds 96 square inches in area and 6 inches in the 
smallest dimension, any part of which is--
    (1) 18 feet or less above either the ground or the roof of an 
adjoining building, or
    (2) 14 feet or less from directly or diagonally opposite windows, 
fire escapes, or roofs, or
    (3) 3 feet or less from openings, fire escapes, etc., in or 
projecting from the same wall or an adjacent wall leading to other 
premises.
    (f) The following types of establishments whose inventories pose a 
particularly serious risk shall, as a minimum, in addition to the 
requirements of paragraphs (a), (b), and (d) of this section be 
protected by the type of alarm system indicated. If the system specified 
in paragraphs (f)(1) and (f)(2) of this section is not available in the 
community in which the premises are located, the type of system 
specified in paragraph (f)(3) of this section shall be permitted.
    (1) Central Station (with Guard dispatch) supervised service alarm 
system shall be required for the following businesses:
    (i) Beer/Wine (wholesale)
    (ii) Boutiques
    (iii) Cameras/Photo/Film Processing
    (iv) Clothing Children's 12 & Under
    (v) Clothing Mfg./Tailoring
    (vi) Clothing Men's
    (vii) Clothing Women's
    (viii) Drug Stores
    (ix) Drugs (wholesale)
    (x) Electrical Appliances/Parts
    (xi) Food Stuffs (wholesale)
    (xii) Gasoline Service Station
    (xiii) Gift Store/Costume Jewelry
    (xiv) Jewelry
    (xv) Leather Products
    (xvi) Liquor Stores
    (xvii) Pawn Brokers
    (xviii) Precious Metals/Electroplating (retail)
    (xix) Radio/TV/Electronic Equip.
    (xx) Record Shop
    (xxi) Savings & Loans/Banks
    (xxii) Shoe Stores
    (xxiii) Tobacco Dealers (wholesale)
    (xxiv) Used Clothing/Shoe Repair/Thrift Stores
    (xxv) Variety/Department Stores
    (2) Central Station (without Guard dispatch) supervised service 
alarm system shall be required for the following businesses:
    (i) Antique Stores
    (ii) Art Supplies
    (iii) Auto Parts--no service
    (iv) Beauty & Health Supplies
    (v) Beer/Wine with Food (retail)
    (vi) Candy/Nuts Stores
    (vii) Dry Goods--Textile/Sewing
    (viii) Furniture/Home Furnishings
    (ix) Furriers
    (x) Grocery Stores/Deli/Health Food Stores

[[Page 388]]

    (xi) Guns/Ammunition
    (xii) Liquor (wholesale)
    (xiii) Meat/Poultry/Fish Dealers
    (xiv) Motorbikes/Bicycles
    (xv) Music Stores/Instruments
    (xvi) Pet Stores/Kennels
    (xvii) Precious Metals/Electroplating (storage)
    (xviii) Sports Goods/General
    (xix) Tobacco Dealers (retail)
    (xx) Wig Shops
    (3) Silent or Local Alarm system shall be required for the following 
businesses:
    (i) All Risks Not Otherwise Classified
    (ii) Amusement Enterprises
    (iii) Art Galleries
    (iv) Auto Parts--sales/service
    (v) Beach Concessions
    (vi) Beauty/Barber Shops
    (vii) Billiard/Pool Parlors
    (viii) Building Contractors/Materials
    (ix) Check Cashing/Money Exchange/Collectors
    (x) Clubs (serving alcohol)
    (xi) Coin/Stamp Shop
    (xii) Discos/Dance Halls/Pavilions
    (xiii) Distributors--Variety/Nonalcoholic
    (xiv) Donut/Pastry/Coffee Shop (seated)
    (xv) Dry Cleaners
    (xvi) Fast Food/Bakery/Donut (carryout)
    (xvii) Fine Arts
    (xviii) Flea Markets/Auction Houses
    (xix) Florists
    (xx) Fruit/Newspaper Stands
    (xxi) Funeral Homes
    (xxii) Garages/Auto Repair
    (xxiii) Golf & Other Prof. Sports Shops
    (xxiv) Hardware/Housewares
    (xxv) Health Clubs/Massage Parlors
    (xxvi) Hobby/Toys/Novelty
    (xxvii) Hotel/Motel/Apartments
    (xxviii) Industrial Materials/Metal Work
    (xxix) Laundries
    (xxx) Marine/Aircraft--Sales/Service
    (xxxi) Medical Supplies
    (xxxii) Nursing/Convalescent Homes
    (xxxiii) Office Supplies/Equipment
    (xxxiv) Parking/Rental Cars/Car Wash/Taxi Office
    (xxxv) Photographers Studios
    (xxxvi) Professional Services
    (xxxvii) Radio/TV/Elec Eq. (service only)
    (xxxviii) Realty/Insurance/Travel/Employment Agency
    (xxxix) Restaurant/Caterer
    (xl) Schools/Day Care
    (xli) Security/Locksmiths/Alarms
    (xlii) Specialized Clothing--Sportswear/Lingerie
    (xliii) Stationery/Books/Printing/Paper
    (xliv) Tavern/Bar/Lounge
    (xlv) Vending Machines
    (g) The protective device requirements set forth in this section 
shall not apply to premises which are insured only under Option 2 
against the peril of robbery only, as provided in paragraph (c) of 
Sec. 83.25 of this chapter.

[36 FR 24772, Dec. 22, 1971, as amended at 37 FR 15298, July 29, 1972; 
38 FR 4508, Feb. 15, 1973; 39 FR 14949, Apr. 29, 1974. Redesignated at 
44 FR 31177, May 31, 1979, as amended at 50 FR 16495, Apr. 26, 1985; 52 
FR 30685, Aug. 17, 1987; 55 FR 42190, Oct. 18, 1990]



PART 83--COVERAGES, RATES, AND PRESCRIBED POLICY FORMS--Table of Contents




             Subpart A--Residential Crime Insurance Coverage

Sec.
83.1  Description of residential coverage.
83.2  Limits of residential coverage.
83.3  Amount of residential policy deductible.
83.4  Residential crime insurance rates.
83.5  Required residential policy form.

             Subpart B--Commercial Crime Insurance Coverage

83.21  Description of commercial coverage.
83.22  Limits of coverage and number of applications required.
83.23  Amount of commercial policy deductible.
83.24  Classification of commercial risks.
83.24a  Gross receipts.
83.25  Commercial crime insurance rates.
83.25a  Application and date of commencement of coverage.
83.26  Required commercial policy form.

    Authority: 12 U.S.C. 1749bbb et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12127.

[[Page 389]]



             Subpart A--Residential Crime Insurance Coverage



Sec. 83.1  Description of residential coverage.

    (a) The purpose of this Sec. 83.1 is descriptive only, and it shall 
be subject to the express terms and conditions of the policy form 
prescribed in Sec. 83.5.
    (b) The initial policy issued by the insurer for residential 
properties shall be known as the residential crime insurance policy. 
Subject to its terms, the policy reimburses an insured for loss from 
burglary and larceny incident thereto, robbery (including observed 
theft), or attempt thereat, of personal property from the premises or in 
the presence of an insured, and for damage to the premises caused by any 
such attempt. It also covers damage to the interior of the part of the 
building occupied by the named insured's household at the described 
premises, and to the insured property both therein and away from the 
premises, caused by vandalism or malicious mischief: Provided, That with 
respect to damage to the building an insured is the owner thereof or is 
liable for such damage. The policy is subject to the exclusions set 
forth therein.
    (c) The residential crime insurance policy shall be written only for 
an individual or for a single family or household with respect to a one 
to four family house or separate living quarters in an apartment 
building or dormitory. Premises in hotels (other than residence hotels 
where normal occupancy exceeds 6 months in duration) and premises within 
residential properties used in whole or in part for business purposes 
are not eligible for coverage under the residential policy. A mobile 
home used as a residence may be insured on a residential application 
form provided the mobile home has been rendered immobile on a permanent 
foundation and anchored to resist flotation or lateral movement. A 
residential premises or a portion thereof owned or leased by a business, 
corporate or otherwise, may not be insured by said business under a 
residental policy. A model home held for eventual sale may not be 
insured under a residential policy. A storeroom used for temporary 
storage of personal property not pertaining to a business may be insured 
under a residential policy, provided that the storage area is surrounded 
by physical barriers which separate it from other storage areas 
available to other persons and that the storage area utilized by the 
insured complies with the protective device requirements applicable to 
residential premises.

[36 FR 24774, Dec. 22, 1971, as amended at 37 FR 15298, July 29, 1972. 
Redesignated at 44 FR 31177, May 31, 1979, as amended at 47 FR 19350, 
May 5, 1982]



Sec. 83.2  Limits of residential coverage.

    The residential policy may be written in amounts not less than 
$1,000 and not in excess of $10,000 for each insurable premises. An 
insurable premises is defined as a physically separate area occupied for 
residential purposes by one or more persons who are permanent members of 
a single household. The $10,000 limit of coverage for each insurable 
premises may not be increased by subdividing the premises shared by 
members of a common household. Any amount of insurance or fraction 
thereof, above a specified limit shall be charged the applicable rate 
for the next higher limit of coverage. Specified limits of coverage are 
set forth in Sec. 83.4.

[47 FR 19350, May 5, 1982]



Sec. 83.3  Amount of residential policy deductible.

    The residential crime insurance policy shall be subject to a 
deductible in the amount of $100 for each loss occurrence, or 5 percent 
of the gross amount of the loss, whichever is greater. The face amount 
of coverage specified in the policy is not reduced by the application of 
this deductible. Thus, if an insured having a $5,000 policy incurs a 
$5,000 covered loss, he would receive $4,750. If the loss were $6,000, 
he would receive the full $5,000.

[39 FR 2361, Jan. 21, 1974. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 47 FR 19350, May 5, 1982]

[[Page 390]]



Sec. 83.4  Residential crime insurance rates.

    The specific limits of coverage for applicable annual premiums for 
residential crime insurance coverage are revised to read as follows:

                                                                        
------------------------------------------------------------------------
                                                                Annual  
                        Policy Limits                           premium 
------------------------------------------------------------------------
$1,000......................................................         $32
 2,000......................................................          42
 3,000......................................................          52
 4,000......................................................          62
 5,000......................................................          74
 6,000......................................................          84
 7,000......................................................          94
 8,000......................................................         104
 9,000......................................................         116
10,000......................................................         126
------------------------------------------------------------------------


[53 FR 11276, Apr. 6, 1988]



Sec. 83.5  Required residential policy form.

    The following shall constitute the policy form for the residential 
crime insurance policy and no other policy form shall be used. Coverage 
will commence at 12 noon following the date of a U.S. Post Office 
affixed postmark or proof of Certified or Registered mailing. In the 
absence of such postmark or other proof sufficient to substantiate the 
date of mailing, coverage will be effective at 12 noon following receipt 
by the servicing company, unless a later date is specified in the 
application.
    (a) Owner's or tenant's Residential Crime Insurance Policy form:

                    Federal Insurance Administration

                   residential crime insurance policy

    The Federal Insurance Administrator, herein called the Insurer, 
agrees with the insured, named in the Application made a part hereof, in 
consideration of the payment of the premium and in reliance upon the 
statements in the Application, and subject to (1) the provisions of 
title VI of Public Law 91-609 (12 U.S.C. 1749bbb-10a, et seq.) and 
subchapter B, chapter I, title 44 of the Code of Federal Regulations (44 
CFR parts 80 through 84), and (2) the limits of liability, exclusions, 
conditions, deductibles, and other terms of this Policy with respect to 
the following criminal acts:

                           Insuring Agreements

    I. Loss by burglary and larceny or robbery, including observed 
theft. (a) To pay for loss by burglary and larceny incident thereto, or 
robbery, including observed theft, of all personal property from the 
premises or in the presence of an insured.
    II. Damage. To pay for damage to the premises and to the insured 
property by burglary or robbery, including observed theft, or attempt 
threat, and for damage to the interior of that portion of any building 
occupied by the named insured's household at the premises and to the 
insured property therein or away from the premises by vandalism or 
malicious mischief which occurs during a burglary or robbery, provided 
that with respect to damage to the building an insured is the owner 
thereof or is liable for repairing such damage.
    With respect to loss occurring at any part of the premises not 
occupied exclusively by the named insured's household, this Insuring 
Agreement applies only to property owned or used by an insured.
    III. Application of insurance while the premises are rented to 
another. Such insurance as is afforded for loss at or damage to the 
premises applies while the premises are rented by an insured owner or 
tenant to another for use as a private residence only, subject to the 
following provisions:
    1. The insurance applies only with respect to property owned by an 
insured.
    2. The insurance does not apply (a) to money, securities, jewelry, 
watches, necklaces, bracelets, gems, precious and semiprecious stones, 
and articles of gold or platinum, furs, fine arts, antiques, coin or 
stamp collections, or (b) to loss caused by a tenant of such premises or 
any of his employees or members of his household.
    IV. Application of insurance while the premises are occupied by 
three or more persons not related to the named insured. Such insurance 
as is afforded for loss at or damage to the premises applies while the 
premises are occupied by three or more persons not related to the named 
insured owner or tenant, subject to the following provisions:
    1. The insurance applies only with respect to property owned by the 
named insured.
    2. The insurance does not apply (a) to money, securities; gems, 
precious and semi-precious stones, gold or platinum (other than 
jewelry); antiques, coin or stamp collections; or (b) to loss caused by 
a tenant of such premises or any of his employees or members of his 
household.
    3. Under this insuring agreement, the actual cash value of any one 
article of jewelry (including watches) shall be deemed not to exceed 
$50.
    V. Removal to other premises. If the named insured moves to other 
premises which he intends to occupy permanently as his private 
residence, such insurance as it afforded for loss at or damage to the 
premises designated in the Application applies subject to the following 
provisions:
    1. During the moving, for a period not to exceed thirty (30) days, 
the insurance applies

[[Page 391]]

at the premises and at the other premises and to the insured property 
while in transit.
    2. Upon completion of the moving the insurance applies at the other 
premises and no longer applies at the original premises: Provided, That 
all coverage under this policy shall cease at the end of the thirty (30) 
day period, and the policy shall be deemed canceled by the Insurer as of 
such date.
    VI. Policy period, territory. This policy applies only to loss which 
occurs during the policy period within a State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, the 
territories and possessions of the United States and the Trust Territory 
of the Pacific Islands as defined in 12 U.S.C. 1749bbb-2 and set forth 
in 44 CFR 55.1.

                               Exclusions

This Policy does not apply:
    (a) To loss committed by an insured;
    (b) To loss of (1) any aircraft, motor vehicle (other than motorized 
equipment designed for service purposes and not licensed for highway 
use), trailer, boat or the equipment thereof, (2) articles carried or 
held as samples or for sale or for delivery after sale, or (3) animals, 
fish or birds;
    (c) To loss sustained by a person not related to an insured who pays 
board or rent to an insured;
    (d) To loss of property pertaining to a business, trade, profession 
or occupation of an insured;
    (e) To loss if the premises are not protected in accordance with the 
regulations of the Federal Insurance Administration, as published at the 
time of the inception of the then current term of the Policy in Crime 
Insurance Program 44 CFR part 80 et seq.
    (f) To any burglary loss from a motor vehicle.
    (g) To loss while the property is vacant.

                               Conditions

    1. Definitions--

    (a) Named insured. ``Named Insured'' means the insured named in the 
Application. Insured means the named insured and any person while a 
permanent member of the insured's household, including a residence 
employee, but not including a tenant who is not related to the named 
insured, the named insured's spouse, or any other permanent member of 
the named insured's household, and who pays board or rent to the named 
insured.
    (b) Premises. ``Premises'' of paragraph 1 means the premises 
designated in the application and includes garages and other 
outbuildings incidental thereto.
    (c) Burglary. ``Burglary'' or ``burglary and larceny incident 
thereto'' mean the felonious abstraction of insured property from within 
the premises by a person making felonious entry.
    (d) Robbery. Robbery or robbery, including observed theft, means the 
taking of insured property (1) by violence inflicted on an insured; (2) 
by putting him in fear of violence; (3) by any other overt felonious act 
committed in his presence and of which he was actually cognizant, 
provided such other act is not committed by an insured; or (4) from the 
person or direct care and custody of an insured who has been killed or 
rendered unconscious.
    (e) Money. ``Money'' means currency, coins, bank notes, and bullion.
    (f) Securities. ``Securities'' mean all negotiable and nonnegotiable 
instruments or contracts representing either money or other property and 
includes revenue and other stamps in current use, tokens, and tickets, 
but does not include money.
    (g) Business. ``Business'' includes trade, profession, or 
occupation.
    (h) Loss. ``Loss'' includes damage.
    (i) Residence employee. ``Residence employee'' means an employee of 
an insured who performs duties in connection with the maintenance or use 
of the residence premises, including household or domestic service.
    2. Interests covered. The insurance does not apply to the interest 
in insured property of any person or organization, unless included in 
the named insured's proof of loss.
    3. Limits of liability; settlement options. The Insurer shall not be 
liable on account of any loss unless the amount of such loss shall 
exceed the amount of the deductible described in the Application which 
is made a part of this Policy and the Insurer shall then be liable only 
for such excess over and above the deductible, subject to and within the 
limit of insurance covered by the Policy. The limit of the Insurer's 
liability for loss or damage in any one occurrence shall not exceed the 
applicable limit of insurance stated in the Application, nor what it 
would cost at the time of loss to repair or replace the property with 
other of like kind and quality, nor the actual cash value thereof at the 
time of loss: Provided, however, that the limit of the insurer's 
liability for loss of money is $200 and for loss of securities is $500, 
and for loss of jewelry, including without limitation, watches, 
necklaces, bracelets, rings, gems, precious and semi-precious stones, 
and articles of gold, silver or platinum, including flatware and 
holloware, furs, fine arts, antiques, coin or stamp collections is $500 
for any one article and $1500 in the aggregate per occurrence.
    If there is a loss of an article which is part of a pair or set, the 
measure of loss shall be a reasonable and fair proportion of the total 
value of the pair or set, giving consideration to the importance of said 
article, but such loss shall not be construed to mean total loss of the 
pair or set.

[[Page 392]]

    The applicable limit of insurance stated in the application is the 
total limit of the Insurer's liability with respect to all loss of 
property of one or more persons or organizations arising out of any one 
occurrence.
    All loss incidental to an actual or attempted fraudulent, dishonest 
or criminal act or series of related acts at the premises, whether 
committed by one or more persons, shall be deemed to arise out of one 
occurrence.
    The Insurer may pay for the loss in money or may repair or replace 
the property and may settle any claim for loss of property either with 
the named insured or the owner thereof. Any property so paid for or 
replaced shall become the property of the Insurer. Any property 
recovered after settlement of a loss shall be applied first to the 
expense of the parties in making such recovery, with any balance applied 
as if the recovery had been made prior to said settlement, and loss 
readjusted accordingly. The insured or the Insurer, upon recovery of any 
such property, shall give notice thereof as soon as practicable to the 
other.
    4. Insured's duties when loss occurs. Upon knowledge of loss or of 
an occurrence which may give rise to a claim for loss, the insured shall 
(a) give notice thereof as soon as practicable to law enforcement 
authorities and to the Insurer through its authorized agent and (b) file 
detailed proof of loss, duly sworn to, with the Insurer through its 
authorized agent within sixty (60) days after the discovery of loss 
unless such time is extended by the Federal Insurance Administrator in 
writing. The administrator may, in his/her discretion, waive the 
requirement that the proof of loss be sworn to. Upon the insurer's 
request, the insured and every claimant hereunder shall submit to 
examination by the insurer, subscribe the same under penalty of 18 
U.S.C. 1001 pertaining to fraud and false representation, and produce 
all pertinent records, all at such reasonable times and places as shall 
be designated, and shall cooperate in all matters pertaining to loss or 
claims with respect thereto. The insured shall as a condition of 
continued coverage take reasonable action immediately following the 
discovery of a loss to protect the premises from further loss.
    5. Other insurance. If there is any other valid and collectible 
insurance which would apply in the absence of this Policy, the insurance 
under this Policy shall apply only as excess insurance over such other 
insurance; provided, that the insurance shall not apply: (a) To property 
which is separately described and enumerated and specifically insured in 
whole or in part by any other insurance; or (b) to property otherwise 
insured unless such property is owned by an insured.
    6. No benefit to bailee. The insurance afforded by this Policy shall 
not inure directly or indirectly to the benefit of any carrier or 
bailee.
    7. Appraisal. If the named insured and the Insurer fail to agree as 
to the amount of loss each shall, on the written demand of either made 
within sixty (60) days after receipt of proof of loss by the Insurer, 
appoint a competent and disinterested appraiser, and the appraisal shall 
be made at a reasonable time and place within thirty (30) days after the 
two appraisers are appointed. If the appraisers fail to agree, they 
shall jointly select a competent and disinterested third appraiser and 
submit the question to him within fifteen (15) days thereafter. The 
first two appraisers shall state separately the actual cash value at 
time of loss and the amount of the loss. Subsequent agreement in writing 
by any two of the three appraisers within thirty (30) days after the 
third appraiser was selected shall be considered by the Insurer in 
determining the amount of the loss but shall not be considered binding 
upon him and shall not be admissible as such in court. The named insured 
and the Insurer shall each pay its chosen appraiser and shall bear 
equally the expenses of the third appraiser and the other expenses of 
appraisal.
    The Insurer shall not be held to have waived any of its rights such 
as, without limitation, the right to deny liability under the Policy by 
any act relating to appraisal.
    8. Action against insurer. No action shall lie against the Insurer 
unless, as a condition precedent thereto, there shall have been full 
compliance with all the terms of this Policy, nor until ninety (90) days 
after the required proofs of loss have been filed with the Insurer, nor 
at all unless commenced within 2 years from the date when the insured 
first has knowledge of the loss and within 1 year after the date upon 
which the claimant received written notice of disallowance or partial 
disallowance of the claim. Any such action shall be brought in a U.S. 
district court, as required by 12 U.S.C. 1749bbb-11.
    9. Subrogation. In the event of any payment under this Policy, the 
Insurer shall be subrogated to all the insured's rights of recovery 
therefor against any person or organization and the insured shall 
execute and deliver instruments and papers and do whatever else is 
necessary to secure such rights. The insured shall do nothing after loss 
to prejudice such rights.
    10. Changes. Notice to any agent or knowledge possessed by any agent 
or by any other person shall not effect a waiver or a change in any part 
of this Policy or estop the Insurer from asserting any right under the 
terms of this Policy; nor shall the terms of this Policy be waived or 
changed, except by endorsement issued to form a part of this Policy, as 
approved by the Federal Insurance Administrator.
    11. Cancellation. This Policy may be canceled by the named insured 
by surrender

[[Page 393]]

thereof to the Insurer or any of its authorized agents or by mailing to 
the Insurer written notice stating when thereafter the cancellation 
shall be effective. The grounds for cancellation of coverage by the 
Insurer shall be limited to those set forth in subchapter B, parts 80 et 
seq., chapter I, title 44 of the Code of Federal Regulations. Except as 
otherwise provided by such regulations and by Insuring Agreement V(2), 
notice of cancellation by the Insurer shall be mailed to the named 
insured at the address shown in this Policy, stating when not less than 
thirty (30) days thereafter such cancellation shall be effective. The 
premium due notice for installment or renewal premiums is issued to 
notify the insured that the policy will be cancelled or will expire, as 
appropriate, unless the insured pays the premium in sufficient time for 
it to be received by the insurer, or postmarked by the United States 
Postal Service, on or before the due date. The mailing of any premium 
due notice, cancellation notice, or any other notice required by the 
policy, to the mailing address shown on the application or policy shall 
be conclusive evidence of notice to the insured. The mailing of notice 
as aforesaid shall be sufficient proof of notice. The time of the 
surrender or the effective date of cancellation stated in the notice 
shall become the end of the Policy period. Delivery of such written 
notice either by the named insured or by the Insurer shall be equivalent 
to mailing.
    In the event of cancellation, earned premium shall be computed in 
accordance with the customary short rate table and procedure, unless 
otherwise specifically provided in said regulations issued by the 
Insurer. Premium adjustment may be made either at the time cancellation 
is effected or as soon as practicable after cancellation becomes 
effective, but payment or tender of unearned premium is not a condition 
of cancellation.
    12. Assignment. Assignment of interest under this Policy shall not 
bind the Insurer until its consent is endorsed hereon; if, however, the 
named insured shall die, this Policy shall cover the named insured's 
spouse, if a resident of the same household at the time of such death, 
and legal representative as named insured: Provided, That notice of 
cancellation addressed to the insured named in the Application and 
mailed to the address shown in this Policy shall be sufficient notice to 
effect cancellation of this Policy. If the legal representative of the 
named insured is not a person who was a permanent member of the named 
insured's household at the time of the death of the named insured, this 
Policy shall apply as it applied prior to such death but shall not apply 
to loss of property owned or used by such legal representative, a member 
of his household or a residence employee thereof, unless such loss 
occurs at a part of the premises occupied exclusively by said named 
insured's household.
    13. Declarations. By signing the Application or by acceptance of 
this Policy the named insured certifies and agrees, under penalty of 
Federal law dealing with fraud and false representation (18 U.S.C. 
1001), that the statements in the Application are his agreements and 
representations, that this Policy is issued in reliance upon the truth 
of such representations, that he is aware of the applicability of the 
Regulations issued by the Insurer, and that this Policy and said 
regulations embody all agreements existing between himself and the 
Insurer or any of its agents relating to this insurance.
    In witness whereof, the Federal Insurance Administration has 
accepted the declarations of the Insured set forth in the Application 
and has caused this Policy to be issued.

&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
lowbarm;&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&l
                                                     owbarm;&lowbarm,  
                                        Federal Insurance Administrator.

    (b) Such endorsements to the owner's or tenant's Residential Crime 
Insurance Policy forms as the insurer may approve.

[36 FR 24774, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 45 FR 41951, 41952, June 23, 1980; 48 FR 19371, Apr. 29, 
1983; 49 FR 43472, Oct. 29, 1984; 52 FR 30686, Aug. 17, 1987; 54 FR 
31681, Aug. 1, 1989]



             Subpart B--Commercial Crime Insurance Coverage



Sec. 83.21  Description of commercial coverage.

    (a) The purpose of this Sec. 83.21 is descriptive only, and it shall 
be subject to the express terms and conditions of the policy form 
prescribed in Sec. 83.26.
    (b) The initial policy issued by the insurer for commercial 
properties shall be known as the Commerical Crime Insurance Policy. 
Subject to its terms, the policy reimburses an insured for loss from 
robbery inside the premises, robbery outside the premises (up to a limit 
of $5,000 unless an armed guard accompanies the insured's messenger), 
the wrongful taking of insured property by compelling an insured to 
admit a person into the premises, safe burglary and larceny incident 
thereto (up to a limit of $5,000 unless the insured property is in a 
Class E safe anchored to the floor), theft observed by the insured, 
burglary and larceny incident thereto, robbery of a watchman (not to 
exceed $50 for any one article of jewelry), and damage to the premises 
(of which the insured is owner or for which

[[Page 394]]

the insured is liable) as a result of any of the foregoing. The policy 
is subject to the exclusions set forth therein.
    (c) The commercial crime insurance policy may be written for any 
industrial, commercial, nonprofit, or public property in accordance with 
the risk classifications set forth in Sec. 83.24 and within the limits 
of coverage set forth in Sec. 83.22, subject to the applicable 
requirements of this subchapter, such as the requirement for adequate 
protective devices set forth in subpart C of part 82 of this chapter.
    (d) Certain portions of the materials contained in the sections that 
follow are based upon the Burglary Insurance Manual issued by the 
Insurance Services Office, 160 Water Street, New York, NY 10038, and are 
being reproduced in these regulations and in the related commercial 
crime insurance manual with the permission of the copyright owner.

[36 FR 24774, Dec. 22, 1971. Redesignated at 44 FR 31177, May 31, 1979, 
as amended at 52 FR 30686, Aug. 17, 1987]



Sec. 83.22  Limits of coverage and number of applications required.

    The Commercial Crime Insurance Policy may be written in amounts not 
less than $1,000 and not in excess of $15,000 for each insured premises. 
The maximum limit may not be increased (a) by insuring several 
departments of a single business or institution at one insurable 
premises as separate premises, or (b) by establishing separate 
businesses for different portions of business operations having a common 
majority ownership which are located at one insurable premises. Each 
$1,000 of insurance or fraction thereof shall be charged the applicable 
rate for the full $1,000 of insurance coverage. Insurable premises is 
defined as one premises or portion thereof utilized for the purpose of 
conducting the business of the insured. Two or more buildings which are 
adjoining and have a common connecting door or passageway are considered 
one building and should be included in one application. Multiple rooms 
or floors within one building are considered one premises and should be 
specifically enumerated on one application. Physically separate 
buildings or portions thereof must be covered on separate applications 
using the appropriate IRS number, with a different suffix on each 
application, in order to identify multiple premises of one business. The 
commercial policy form must be used by a business for residential 
properties owned or leased by said business, incorporated or otherwise 
and for model homes. Such risks must meet commercial protective device 
requirements. If an insured shares a premises with one or more other 
businesses but there is no physical barrier meeting protective device 
requirements to separate the business, the insured is entitled to 
coverage with limitations as described in Secs. 82.5(i) and 83.22.

[47 FR 19350, May 5, 1982]



Sec. 83.23  Amount of commercial policy deductible.

    (a) The Commercial Crime Insurance Policy for industrial and 
commercial risks shall be subject to a deductible in the following 
amounts for each loss occurrence or 5 percent of the gross amount of the 
loss, whichever is greater, in accordance with the following categories 
of annual gross receipts (or operating budget, if applicable):

Less than $299,999...............................................   $250
$300,000 to $499,999.............................................    350
$500,000 and above...............................................    500
                                                                        

    (b) The Commercial Crime Insurance Policy for non-profit or public 
property risks shall be subject to a deductible in the amount of $250 
for each loss occurrence or 5 percent of the amount of loss, whichever 
is greater.
    (c) Higher deductibles, percentage participation clauses and other 
underwriting devices may be employed by the insurer to meet special 
problems of insurability.

[47 FR 19351, May 5, 1982, as amended at 49 FR 43472, Oct. 29, 1984]



Sec. 83.24  Classification of commercial risks.

    (a) The governing factor in determining the risk classification 
applicable to a particular premises is the kind of business conducted by 
the insured at that location. If there are several types of merchandise 
applicable to the risk,

[[Page 395]]

the highest classification of merchandise inventoried and held for sale 
governs. For example, a business with the following types of merchandise 
inventoried, 60% handbags and wigs, and 40% fine jewelry, shall be 
classified as Class 5 Fine Jewelry.

Any change in classification must be reported to the insurer through the 
servicing company.
    (b) Individual concessionaires operating within a premises are 
classified according to the business or merchandise of the 
concessionaire.
    (c) Warehouses and/or other storage areas shall take the 
classification of the merchandise or inventory comprising the majority 
value of the contents.
    (d) Following are minimum alarm requirements for various 
classifications of businesses:

                                                                        
------------------------------------------------------------------------
                                             Class                      
     Code        Business description -------------------   Alarm type  
                                       Burglary  Robbery                
------------------------------------------------------------------------
A1              NOC..................         3        4  D             
02              Amusement enterprises         2        3  D             
B1              Antique stores.......         3        4  C             
C1              Art galleries........         3        4  D             
33              Art supplies.........         5        5  C             
D1              Auto parts--no                2        2  C             
                 service.                                               
03              Auto parts--sales/            2        2  D             
                 service.                                               
47              Beach concessions....         3        4  D             
32              Beauty/barber shops..         2        2  D             
41              Beauty & health           3        4  C             
                 supplies.                                              
C6              Beer/wine with food           5        5  C             
                 (retail).                                              
F1              Beer/wine (wholesale)         6        6  B             
04              Billiard/pool parlors         3        4  D             
70              Boutiques............         6        6  B             
05              Bowling lanes/skating         2        3  E             
                 rinks.                                                 
34              Building contractors/         2        3  D             
                 materials.                                             
06              Cameras/photo/film            5        5  B             
                 processing.                                            
43              Candy/nuts stores....         3        4  C             
G1              Check cashing/money           4        6  D             
                 exchange/collectors.                                   
J1              Churches/charities/           1        1  E             
                 public properties.                                     
36              Clothing childrens 12         5        2  B             
                 & under.                                           
I1              Clothing mfg./                3        6  B             
                 tailoring.                                             
22              Clothing men's.......         6        5  B             
30              Clothing women's.....         6        6  B             
07              Clubs (serving                3        4  D             
                 alcohol).                                              
K1              Coin/stamp shop......         3        4  D             
08              Discos/dance halls/           2        3  D             
                 pavilions.                                             
50              Distributors--variety/        2        4  D             
                 Nonalcoholic.                                          
C5              Donut/pastry/coffee           3        4  D             
                 shop (seated).                                         
09              Drug stores..........         5        4  B             
L1              Drugs (wholesale)....         5        6  B             
10              Dry cleaners.........         5        5  D             
38              Dry Goods--textile/           3        4  C             
                 sewing.                                                
11              Electrical appliances/        5        5  B             
                 parts.                                                 
E1              Fast food/bakery/             4        3  D             
                 donut (carryout).                                      
39              Fine arts............         2        3  D             
78              Flea markets/auction          2        3  D             
                 houses.                                                
40              Florists.............         2        4  D             
M1              Food stuffs                   3        5  B             
                 (wholeslae).                                           
N1              Fruit/newspaper               4        3  D             
                 stands.                                                
45              Funeral homes........         2        3  D             
421             Furniture/home                4        3  C             
                 furnishings.                                           
12              Furriers.............         5        5  C             
13              Garages/auto repair..         3        3  D             
14              Gasoline service              5        4  B             
                 station.                                               
44              Gift store/costume            6        4  B             
                 jewelry.                                               
15              Golf & other              2        3  D             
                 prof. sports shops.                                    
16              Grocery stores/deli/          5        5  C             
                 health food stores.                                    
17              Guns/ammunition......         6        6  C             
46              Hardware/housewares..         3        4  D             
C2              Health clubs/massage          2        3  D             
                 parlors.                                               
80              Hobby/toys/novelty...         3        4  D             
48              Hotel/motel/                  2        3  D             
                 apartments.                                            
01              Industrial materials/         2        3  D             
                 metal work.                                            
18              Jewelry..............         3        6  B             
19              Laundries............         2        3  D             
52              Leather products.....         6        4  B             
20              Liquor stores........         2        2  B             
P1              Liquor (wholesale)...         4        2  C             
37              Marine/aircraft--             3        4  D             
                 sales/service.                                         
21              Meat/poultry/fish             2        3  C             
                 dealers.                                               
54              Medical supplies.....         2        2  D             
Q1              Motorbikes/bicycles..         3        4  C             
56              Music stores/                 3        4  C             
                 instruments.                                           
35              Nursing/convalescent          2        3  D             
                 homes.                                                 
C3              Office supplies/              2        3  D             
                 equipment.                                             
58              Parking/rental cars/          2        2  D             
                 car wash/taxi office.                                  
23              Pawn brokers.........         4        2  B             
76              Pet stores/kennels...         3        4  C             
R1              Photographers studios         2        3  D             
S1              Precious metals/              6        6  C             
                 electroplating                                         
                 (storage).                                             
C8              Precious metals/              4        2  B             
                 electroplating                                         
                 (retail, wholesale,                                    
                 mfg.).                                                 
74              Professional services         2        2  D             
24              Radio/TV/electronic           6        5  B             
                 equip.                                                 
C4              Radio/TV/elec eq.             2        3  D             
                 (service only).                                        
62              Realty/insurance/             2        3  D             
                 travel/employment                                      
                 agency.                                                
T1              Record shop..........         5        4  B             
25              Restaurant/caterer...         3        4  D             
26              Savings & loans/          4        3  B             
                 banks.                                                 

[[Page 396]]

                                                                        
66              Schools/day care.....         2        3  D             
64              Security/locksmiths/          2        4  D             
                 alarms.                                                
68              Shoe stores..........         6        5  B             
H1              Specialized clothing-         4        2  D             
                 sportswear/lingerie.                                   
U1              Sports goods/general.         5        2  C             
60              Stationery/books/             3        4  D             
                 printing/paper.                                        
27              Tavern/bar/lounge....         4        4  D             
V1              Taxi/limousines               2        3  E             
                 (robbery only).                                        
28              Theatres.............         2        3  E             
29              Tobacco dealers               5        5  C             
                 (retail).                                              
C9              Tobacco dealers               3        4  B             
                 (wholesale).                                           
72              Used clothing/shoe            5        5  B             
                 repair/thrift stores.                                  
W1              Variety/department            6        6  B             
                 stores.                                                
X1              Vending machines.....         2        3  D             
Y1              Wig shops............         5        2  C             
------------------------------------------------------------------------


[47 FR 19351, May 5, 1982, as amended at 50 FR 16496, Apr. 26, 1985; 52 
FR 30686, Aug. 17, 1987; 55 FR 42191, Oct. 18, 1990]



Sec. 83.24a  Gross receipts.

    The annual gross receipts figure of a business is used as a 
significant factor in calculating the annual premium and for determining 
the deductible applicable to any loss. It is therefore material to the 
issuance of a policy and must be correctly stated. Misstatement of gross 
receipts at the time of application or any subsequent renewal will cause 
the policy to be voided and any claim denied. Gross receipts must be 
verified at the time of adjustment of any loss. Renewal payment of a 
Commercial Crime Insurance Policy will not be accepted and the policy 
renewed unless the current gross receipts figure is submitted with the 
premium payment. Failure to submit the gross receipts figure may result 
in a lapse of coverage. The following guidelines are applicable in 
determining the correct annual gross receipts figure to be reported.
    (a) The annual gross receipts figure should be taken from the most 
recent annual Federal Income Tax Return (or comparable tax return in 
Puerto Rico and Virgin Islands) filed prior to the date of the 
application or renewal date. The figure is applicable to the policy for 
a period of one year and the policy can be changed in term to reduce or 
increase the premium because of a reduction or increase in gross 
receipts provided there are no incurred claims.
    (b) A new business that has not as yet filed an annual Federal 
Income Tax Return (or ventas netas in Puerto Rico) shall insert an 
estimated projection of gross sales. However, an applicant is not 
considered to be a ``new business'' if any of the owners or officers of 
the business have been owners or officers of any similar business 
previously operated at the same address. In such a case the annual gross 
receipts figure as listed in the most recently filed income tax return 
of the former business should be used, if available. If such figure is 
not available, an estimate by the insured's accountant of the annual 
gross receipts reasonably anticipated during the first year of operation 
will be accepted.
    (c) A non-profit or public entity that has no gross receipts (ventas 
netas in Puerto Rico) or whose annual operating budget exceeds the gross 
receipts shall report its operating budget rather than gross receipts.
    (d) The gross receipts figure for a bank or other financial 
institution shall be the total income line of the tax return (ventas 
netas in Puerto Rico) as derived from dividends, interest, investment 
income, capital gains and other income. If several branches of one 
business are covered, the total income shall be divided equally among 
the branches insured.
    (e) The gross receipts figure (ventas netas for Puerto Rico) for a 
real estate, property management or similar type of business shall be 
the ``Total Income'' line of the tax return as derived from interest, 
rents, capital gains, other, etc.
    (f)(1) A warehouse operated as a distribution center for store(s) 
under common ownership and management shall report the total gross 
receipts of the store(s) it supplies. If a warehouse supplies more than 
one store, it shall report the sum of the gross receipts figures for all 
the stores it supplies. If more than one warehouse supplies one store, 
the gross receipts figure applicable to the store shall be apportioned 
among the warehouses according to the percentage the value of 
merchandise supplied by each warehouse bears to

[[Page 397]]

the total value of merchandise supplied.
    (2) A warehouse operated as a distribution center for store(s) not 
under common ownership and management shall report the total gross 
receipts of the warehouse only, if the business is taxed on gross 
receipts.
    (3) A warehouse operated as a distribution center for store(s) not 
under common ownership and management shall report the ``Total Income'' 
line of the tax return as derived from interest, rents, capital gains, 
other, etc., if the business is not taxed on gross receipts.
    (g) If an insured has multiple premises as defined in Sec. 83.22, 
the gross receipts of the total business shall be divided among the 
various locations in accordance with the percentage of the total gross 
receipts generated by each location.
    (h) If an insured premises is regularly utilized as a collection 
center for performing accounting or bookkeeping functions with respect 
to the receipts delivered from two or more other premises, resulting in 
the accumulation of the combined receipts from such other premises at 
one location, the gross receipts for such location shall be determined 
by using the sum of the gross receipts amounts of all the other premises 
from which receipts are received. Further, if such insured premises is 
regularly utilized as a collection center at which there is accumulated 
money or property for distribution to one or more other insured 
premises, the gross receipts for such location shall be determined by 
using the sum of the gross receipt amounts of all the other insured 
premises to which distribution is made.
    (i) Any questions regarding gross receipts or unique or unusual risk 
requiring special rating treatment shall be submitted to the servicing 
company listed in Sec. 80.6 of this chapter for rate quotation.

[47 FR 19355, May 5, 1982, as amended at 50 FR 16497, Apr. 26, 1985]



Sec. 83.25  Commercial crime insurance rates.

    (a) Premium rates for Commercial Crime Insurance Policies for risks 
shall be determined by reference to the rate charts contained in 
paragraph (e) of this section. The annual gross receipts shall be 
determined in accordance with Sec. 83.24(a).
    (b) Option 1: An applicant may apply for insurance coverage under 
Insuring Agreements I, II, III, IV, and VII of the Commercial Policy 
dealing with Safe Burglary, Theft from Night Depository, and Burglary or 
Robbery of a Watchman, and Damage resulting from losses under Insuring 
Agreements I and VII only. Such coverage shall be referred to as Option 
1.
    (c) Option 2: An applicant may apply for insurance coverage under 
Insuring Agreements V, VI, VII, and VIII of the Commercial Policy 
dealing with Robbery and Observed Theft inside and outside the premises 
and Damage resulting from losses under Insuring Agreements V and VI 
only. Such coverage shall be referred to as Option 2.
    (d) Option 3: An applicant may apply for insurance coverage under 
all of the Insuring Agreements I, II, III, IV, V, VI, and VII of the 
Commercial Crime Insurance Policy. This Option provides for uniform as 
well as varying limits of coverage under Option 1 and 2 but only in the 
same policy. Both Options 1 and 2 must be applied for at the same time. 
If one of the options has been selected the other option may be added 
upon a renewal or upon an endorsement of the original policy. A discount 
will be provided for Combined Coverage, Option 3.
    (e) The following tables shall be used to determine rates for 
commercial risks:

[[Page 398]]



                                         Federal Crime Insurance Program, Commercial Crime Insurance Rates, 1991                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                            Gross receipts                                                              
             -------------------------------------------------------------------------------------------------------------------------------------------
                Less than $100,000       $100,000-$199,999       $200,000-$299,999      $300,000-$499,999      $500,000-$999,999        $1,000,000 or   
  Amount of  ----------------------------------------------------------------------------------------------------------------------        greater      
  insurance           Option                   Option                  Option                 Option                 Option        ---------------------
             ----------------------------------------------------------------------------------------------------------------------        Option       
                                                                                                                                   ---------------------
                   1           2           1            2           1          2           1          2           1          2          1          2    
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Annual Premiums, Class 1                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......         90         137         135          206         135        206         180        274         225        343        360        548 
2,000.......        165         245         247          368         247        368         329        490         412        613        659        981 
3,000.......        239         353         359          530         359        530         479        707         599        884        958       1414 
4,000.......        309         452         463          678         463        678         617        904         772       1130       1235       1808 
5,000.......        351         511         527          767         527        767         702       1022         878       1278       1404       2044 
6,000.......        383         562         575          843         575        843         767       1123         959       1404       1534       2247 
7,000.......        403         596         605          894         605        894         806       1192        1008       1490       1613       2384 
8,000.......        421         633         632          949         632        949         842       1266        1053       1582       1685       2532 
9,000.......        428         644         643          966         643        966         857       1288        1071       1610       1714       2576 
10,000......        441         669         661         1003         661       1003         882       1337        1102       1671       1764       2674 
11,000......        474         729         711         1093         711       1093         949       1458        1186       1822       1897       2915 
12,000......        500         778         749         1167         749       1167         999       1556        1249       1945       1998       3113 
13,000......        511         801         767         1202         767       1202        1022       1603        1278       2004       2045       3206 
14,000......        518         814         776         1221         776       1221        1035       1628        1294       2034       2070       3255 
15,000......        525         826         787         1239         787       1239        1049       1652        1312       2065       2099       3304 
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                Annual Premiums, Class 2                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......        108         164         162          247         162        247         216        329         270        411        432        658 
2,000.......        198         294         296          441         296        441         395        589         494        736        791       1177 
3,000.......        287         424         431          636         431        636         575        848         718       1060       1149       1697 
4,000.......        370         543         556          814         556        814         741       1085         926       1356       1482       2170 
5,000.......        421         613         632          920         632        920         842       1226        1053       1533       1685       2453 
6,000.......        460         674         690         1011         690       1011         920       1348        1150       1685       1840       2696 
7,000.......        484         715         726         1073         726       1073         968       1430        1210       1788       1935       2861 
8,000.......        505         760         758         1139         758       1139        1011       1519        1264       1899       2022       3038 
9,000.......        514         773         771         1159         771       1159        1028       1545        1285       1932       2056       3091 
10,000......        529         802         794         1203         794       1203        1058       1605        1323       2006       2117       3209 
11,000......        569         875         854         1312         854        312        1138       1749        1423       2187       2277       3498 
12,000......        599         934         899         1401         899       1401        1199       1868        1499       2334       2398       3735 
13,000......        613         962         920         1443         920       1443        1227       1923        1534       2404       2454       3847 
14,000......        621         977         932         1465         932       1465        1242       1953        1553       2441       2484       3906 
15,000......        630         991         944         1487         944       1487        1259       1983        1574       2478       2519       3965 
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½                                                                                                                                           
                                                                Annual Premiums, Class 3                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......        121         171         182          257         182        257         243        343         304        428        486        685 
2,000.......        222         307         334          460         334        460         445        613         556        766        889       1226 
3,000.......        323         442         485          663         485        663         646        884         808       1105       1293       1767 
4,000.......        417         565         625          848         625        848         833       1130        1042       1413       1667       2261 
5,000.......        474         639         711          958         711        958         948       1278        1185       1597       1895       2555 
6,000.......        518         702         776         1053         776       1053        1035       1404        1294       1755       2070       2809 
7,000.......        544         745         816         1117         816       1117        1089       1490        1361       1862       2177       2980 
8,000.......        569         791         853         1187         853       1187        1137       1582        1422       1978       2274       3165 
9,000.......        578         805         868         1207         868       1207        1157       1610        1446       2012       2313       3220 
10,000......        595         836         893         1254         893       1254        1191       1671        1488       2089       2381       3343 
11,000......        640         911         960         1367         960       1367        1281       1822        1601       2278       2561       3644 
12,000......        674         973        1011         1459        1011       1459        1349       1945        1686       2432       2697       3891 
13,000......        690        1002        1035         1503        1035       1503        1380       2004        1725       2505       2760       4007 
14,000......        699        1017        1048         1526        1048       1526        1397       2034        1747       2543       2794       4069 
15,000......        708        1033        1063         1549        1063       1549        1417       2065        1771       2582       2833       4131 
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½                                                                                                                                           
                                                                Annual Premiums, Class 4                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......        131         178         196          267         196        267         261        356         326        445        522        712 
2,000.......        239         319         358          478         358        478         478        638         597        797        955       1275 
3,000.......        347         459         521          689         521        689         694        919         868       1149       1389       1838 
4,000.......        448         588         671          882         671        882         895       1175        1119       1469       1790       2351 
5,000.......        509         664         763          996         763        996        1018       1329        1272       1661       2036       2657 
6,000.......        556         730         834         1095         834       1095        1112       1460        1390       1826       2224       2921 
7,000.......        585         775         877         1162         877       1162        1169       1549        1462       1937       2339       3099 
8,000.......        611         823         916         1234         916       1234        1221       1646        1527       2057       2443       3291 

[[Page 399]]

                                                                                                                                                        
9,000.......        621         837         932         1256         932       1256        1242       1674        1553       2093       2485       3348 
10,000......        639         869         959         1304         959       1304        1279       1738        1599       2173       2558       3477 
11,000......        688         947        1032         1421        1032       1421        1375       1895        1719       2369       2751       3790 
12,000......        724        1012        1086         1517        1086       1517        1449       2023        1811       2529       2897       4046 
13,000......        741        1042        1112         1563        1112       1563        1482       2084        1853       2605       2965       4168 
14,000......        750        1058        1126         1587        1126       1587        1501       2116        1876       2645       3002       4232 
15,000......        761        1074        1141         1611        1141       1611        1522       2148        1902       2685       3043       4296 
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½                                                                                                                                           
                                                                Annual Premiums, Class 5                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......        135         185         203          277         203        277         270        370         338        462        540        740 
2,000.......        247         331         371          497         371        497         494        662         618        828        988       1324 
3,000.......        359         477         539          716         539        716         718        954         898       1193       1436       1909 
4,000.......        463         610         695          916         695        916         926       1221        1158       1526       1852       2441 
5,000.......        527         690         790         1035         790       1035        1053       1380        1316       1725       2106       2759 
6,000.......        575         758         863         1137         863       1137        1150       1517        1438       1896       2300       3033 
7,000.......        605         805         907         1207         907       1207        1210       1609        1512       2011       2419       3218 
8,000.......        632         854         948         1282         948       1282        1264       1709        1580       2136       2527       3418 
9,000.......        643         869         964         1304         964       1304        1285       1739        1607       2173       2570       3477 
10,000......        662         903         992         1354         992       1354        1323       1805        1654       2256       2646       3610 
11,000......        711         984        1067         1476        1067       1476        1423       1968        1779       2460       2846       3936 
12,000......        749        1051        1124         1576        1124       1576        1499       2101        1873       2626       2997       4202 
13,000......        767        1082        1150         1623        1150       1623        1534       2164        1917       2705       3067       4328 
14,000......        776        1099        1164         1648        1164       1648        1553       2197        1941       2747       3105       4394 
15,000......        787        1115        1181         1673        1181       1673        1574       2230        1968       2788       3148       4461 
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½                                                                                                                                           
                                                                Annual Premiums, Class 6                                                                
                                                                                                                                                        
ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½ï¿½
1,000.......        177         190         266          285         266        285         354        379         443        474        709        759 
2,000.......        324         340         486          509         486        509         649        679         811        849       1297       1359 
3,000.......        471         490         707          734         707        734         943        979        1178       1224       1886       1958 
4,000.......        608         626         912          939         912        939        1216       1252        1520       1565       2431       2505 
5,000.......        691         708        1037         1062        1037       1062        1382       1415        1728       1769       2764       2831 
6,000.......        755         778        1132         1167        1132       1167        1510       1556        1887       1945       3020       3112 
7,000.......        794         825        1191         1238        1191       1238        1588       1651        1985       2063       3176       3302 
8,000.......        829         877        1244         1315        1244       1315        1659       1753        2073       2192       3317       3506 
9,000.......        844         892        1265         1338        1265       1338        1687       1784        2109       2230       3374       3567 
10,000......        868         926        1302         1389        1302       1389        1737       1852        2171       2315       3473       3704 
11,000......        934        1009        1401         1514        1401       1514        1868       2019        2335       2524       3736       4038 
12,000......        984        1078        1475         1617        1475       1617        1967       2156        2459       2694       3934       4311 
13,000......       1007        1110        1510         1665        1510       1665        2013       2220        2516       2775       4026       4440 
14,000......       1019        1127        1528         1691        1528       1691        2038       2254        2547       2818       4076       4508 
15,000......       1033        1144        1550         1716        1550       1716        2066       2288        2583       2860       4133       4577 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Option 1: Burglary only.                                                                                                                                
Option 2: Robbery only.                                                                                                                                 
Option 3: A combination of coverages under options 1 and 2 in uniform or varying amounts. The premium for option 3 is the sum of the rates for amounts  
  of coverage selected under options 1 and 2.                                                                                                           
Discounts on these rates are afforded for businesses with alarm systems/safes. A discount of 10% is given for policies with option 3.                   

    (f) If the premises are protected by an acceptable burglar alarm 
system, class E safe, supervised safe alarm system, holdup alarm or 
armored car service, premium discounts shall be permitted as follows:

                           I. BURGLARY CREDITS

[[Page 400]]



                                              Premises Alarm System                                             
----------------------------------------------------------------------------------------------------------------
                                                                            Class E or      Safe Not Alarmed    
                                                                  Safe        better   -------------------------
                            Code                                Alarmed   -------------  Class E or             
                                                                            Other/safe     better     Other/none
----------------------------------------------------------------------------------------------------------------
E None......................................................          .80          .95          .85         1.00
D Local or Silent *.........................................          .70          .75          .75          .90
C Central Station wo/Guard..................................          .65          .75          .70          .80
B Central Station w/Guard/Keys..............................          .60          .70          .65          .75
A Central Station (UL) Approved.............................          .55          .65          .60          .70
----------------------------------------------------------------------------------------------------------------
*  Professionally installed with maintenance.                                                                   
                                                                                                                


    Note: Multiply the burglary premium by the appropriate factor.

                           II. ROBBERY CREDITS

                           Protection Service                           
------------------------------------------------------------------------
                                                     Armored            
                  Hold up buttons                      car        None  
------------------------------------------------------------------------
Yes...............................................       0.85       0.90
No................................................        .95       1.00
------------------------------------------------------------------------


    Note: Multiply the robbery premium by the appropriate factor.

                            Package Discount

    Apply a factor of .90 to the total premium if both burglary and 
robbery are purchased.

[50 FR 16497, Apr. 26, 1985, as amended at 53 FR 11276, Apr. 6, 1988; 54 
FR 31682, Aug. 1, 1989; 55 FR 42191, 42193, Oct. 18, 1990; 57 FR 26776, 
June 16, 1992]



Sec. 83.25a  Application and date of commencement of coverage.

    (a) Application for commercial Federal crime insurance shall be made 
only on forms approved by the Administrator. When a property is found by 
preinspection to comply with the applicable protective device 
requirements, coverage on property under a policy covering burglary 
losses will commence at 12:00 noon following the date of a U.S. Post 
Office affixed postmark, or proof of Certified or Registered mailing. In 
the absence of such postmark or other proof sufficient to substantiate 
the date of mailing, coverage will be effective at 12:00 noon following 
receipt by the servicing company, unless a later date is specified in 
the application.
    (b) Coverage under a policy covering robbery only will commence as 
described in paragraph (a) of this section, except that protective 
device preinspection is not applicable. When both robbery and burglary 
coverages are applied for on an application, an advance request may be 
submitted with the application to issue a policy for Option 2 Robbery 
Only insurance coverage if the premises fails to meet the protective 
device requirements which must be complied with as a prerequisite to 
obtaining burglary coverage. In such an event the Option 2 policy 
covering only robbery losses will commence as described above.

[45 FR 41956, June 23, 1980]



Sec. 83.26  Required commercial policy form.

    The following shall constitute the policy form for the commercial 
crime insurance policy, and no other policy form shall be used unless 
otherwise provided by this Sec. 83.26.
    (a) [Reserved]
    (b) Commercial Crime Insurance Policy form:

                     Federal Insurance Administration

                    commercial crime insurance policy

    The Federal Insurance Administrator, herein called the Insurer, 
agrees with the insured, named in the Application made a part hereof, in 
consideration of the payment of the premium and in reliance upon the 
statements in the Application, and subject to (1) the provisions of 
title VI of Public Law 91-609 and subchapter B, parts 80 et seq., 
chapter I, title 44 of the Code of Federal Regulations, and (2) the 
limits of insurance, exclusions, conditions, deductibles, and other 
terms of this Policy with respect to the following criminal acts:

[[Page 401]]

                           Insuring Agreements

            Option 1 (Burglary Only Including Safe Burglary)

    Option 1 includes insurance coverage only under the individually 
numbered insuring Agreements I, II, III, and IV listed below.

                   I. Burglary: Robbery of a Watchman

    To pay for loss by burglary or by robbery of a watchman, while the 
named premises are not open for business, of merchandise, furniture, 
fixtures and equipment within the named premises provided that this 
Insuring Agreement does not extend to the loss of money or securities or 
to cash value in excess of $50 for any item of jewelry unless such 
property is forcibly extracted from a locked safe as provided under 
Insuring Agreement II entitled ``Safe Burglary'' which follows:

                            II. Safe Burglary

    To pay for loss by safe burglary of money, securities and 
merchandise within the named premises while the premises are not open 
for business, but no payment shall be made for loss not forcibly 
extracted from a locked safe, nor by a loss in excess of $5,000 except 
with respect to loss by safe burglary of a safe rated for burglary 
resistance as Class E or better weighing at least seven hundred and 
fifty pounds or securely anchored to the floor.

                               III. Damage

    To pay for damage to the named premises and to money, securities, 
merchandise, furniture, fixtures and equipment within the named premises 
by burglary, robbery of a watchman, safe burglary or attempt thereat 
provided the insured is the owner thereof or is liable for such damage.

                      IV. Policy Period, Territory

    To pay for losses under Insuring Agreements I, II, and III only when 
occurring during the policy period within a State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands and such 
other territories or possessions of the United States, including the 
Trust Territory of the Pacific Islands, as defined in 12 U.S.C. 1749bbb-
10a et seq. and set forth in 44 CFR part 80 et seq.

                         Option 2 (Robbery Only)

    Option 2 includes insurance coverage only under the individually 
numbered insuring Agreement V, VI, VII and VIII listed below.

        V. Robbery, Including Observed Theft Inside the Premises

    To pay for loss by robbery or observed theft of money, securities, 
merchandise, furniture, fixtures, and equipment within the named 
premises.

     VI. Robbery, Including Observed Theft, Outside of the Premises

    To pay for loss by robbery or observed theft of money, securities 
and merchandise, including the wallet or bag containing such property 
while such property is in conveyance by the insured or his messenger 
outside the named premises, but no payment shall be made for any loss in 
excess of $5,000 except when the insured or his messenger is accompanied 
by a guard armed with a firearm. The person carrying the insured 
property and the armed guard cannot be the same person.
    This Insuring Agreement includes theft from a night desository but 
only if a deposit of money has been made at a night depository of a 
banking institution by a bonded armored car messenger service.

                               VII. Damage

    To pay for damage to the named premises and to money, securities, 
merchandise, furniture, fixtures and equipment within the named 
premises, by robbery, or attempt thereat, provided the insured is the 
owner thereof or is liable for such damage.

                     VIII. Policy Period, Territory

    To pay for losses under Insuring Agreements V, VI, VII only when 
occurring during the policy period within a State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands and such 
other territories or possessions of the United States including the 
Trust Territory of the Pacific Islands, as defined in 12 U.S.C. 1749bbb-
10a et seq. and set forth in 44 CFR part 80 et seq.

     Option 3 (Robbery and Burglary in Uniform and Varying Amounts)

    Option 3 shall provide for uniform and varying limits of coverage 
under Option 1 and 2 but only in the same policy. Both Option 1 and 2 
must be applied for at the same time.
    If one of the options has been selected, the other option may be 
added upon a renewal or upon an endorsement of the original policy. A 
discount will be provided for Combined Coverage, Option 3.
    Option 1 includes insurance coverage under all of the individually 
numbered Insuring Agreements listed under the headings Option 2 and 
Option 3, thus constituting a combination of equal amounts of robbery 
and burglary insurance coverage.
    Option 2 includes insurance coverage only under the individually 
numbered insuring Agreements I, II, III and IV listed below:

[[Page 402]]

        I. Robbery, including observed theft inside the premises

    To pay for loss by robbery or observed theft of money, securities, 
merchandise, furniture, fixtures, and equipment within the named 
Premises.

      II. Robbery, including observed theft outside of the premises

    To pay for loss by robbery or observed theft of money, securities 
and merchandise, including the wallet or bag containing such property 
while such property is in conveyance by the insured or his messenger 
outside the named premises, but no payment shall be made for any loss in 
excess of $5,000 except when the insured or his messenger is accompanied 
by a guard armed with a firearm. The person carrying the insured 
property and the armed guard cannot be the same person.

This Insuring Agreement includes theft from a night depository but only 
if a deposit of money has been made at a night depository of a banking 
institution by a bonded armored car messenger service.

                               III. Damage

    To pay for damage to the named premises and to money, securities, 
merchandise, furniture, fixtures and equipment within the named 
premises, by robbery or attempt thereat, provided the insured is the 
owner thereof or is liable for such damage.

                      IV. Policy period, territory

    To pay for losses under Insuring Agreements I, II and III only when 
occurring during the policy period within a State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands and such 
other territories or possessions of the United States including the 
Trust Territory of the Pacific Islands as defined in 12 U.S.C. 1749bbb-2 
and set forth in 44 CFR 55.1.

Option 3 includes insurance coverage only under the individually 
numbered Insuring Agreements V, VI, VII and VIII listed below.

                   V. Burglary, robbery of a watchman

    To pay for loss by burglary or by robbery of a watchman, while the 
named premises are not open for business, of merchandise, furniture, 
fixtures and equipment within the named premises provided that this 
Insuring Agreement does not extend to the loss of money or securities or 
to cash value in excess of $50 for any item of jewelry unless such 
property is forcibly extracted from a locked safe as provided under 
Insuring Agreement VI entitled ``Safe Burglary'' which follows.

                            VI. Safe burglary

    To pay for loss by safe burglary of money, securities and 
merchandise within the named premises while the premises are not open 
for business, but no payment shall be made for a loss in excess of $5000 
except with respect to loss by safe burglary of a safe rated for 
burglary resistance as Class E or better weighing at least seven hundred 
and fifty pounds or securely anchored to the floor.

                               VII. Damage

    To pay for damage to the named premises and to money, securities, 
merchandise, furniture, fixtures and equipment within the named premises 
by burglary, robbery of a watchman, safe burglary or attempt thereat 
provided the insured is the owner thereof or is liable for such damage.

                     VIII. Policy period, territory

    To pay for losses under Insuring Agreements V, VI, and VII only when 
occurring during the policy period within a State, the District of 
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands and such 
other territories or possessions of the United States, including the 
Trust Territory of the Pacific Islands as defined in 12 U.S.C. 1749bbb-2 
and set forth in 44 CFR 55.1.

Option 4 shall include insurance coverage under all of the individually 
numbered Insuring Agreements listed under the headings Option 2 and 3 
but constituting a combination of unequal amounts of robbery and 
burglary insurance coverages.

                               Exclusions

    This Policy does not apply:
    (a) To loss due to embezzlement or to any fraudulent, dishonest or 
criminal act by any insured, a partner therein, or an officer, employee, 
director, trustee or authorized representative thereof while working or 
otherwise and whether acting alone or in collusion with others; provided 
that this exclusion does not apply to robbery or safe burglary by other 
than an insured, an officer or a partner thereof.
    (b) To loss due to war, whether or not declared, civil war, 
insurrection, rebellion, or revolution, or to any act or condition 
incident to any of the foregoing;
    (c) To loss of manuscripts, records, or accounts;
    (d) Under Insuring Agreement I and II to loss occurring during a 
fire in the premises.
    (e) To loss due to nuclear reaction, nuclear radiation, or 
radioactive contamination, or to any act or condition incident to any of 
the foregoing;
    (f) To any loss if the premises are not equipped with the protective 
devices required as a condition of eligibility for the purchase of this 
policy or if the insured has failed to take reasonable action to 
maintain the protective devices in working order in accordance with the 
regulations of the Federal Insurance Administration, as published

[[Page 403]]

at the time of the inception of the current term of the policy in 
subchapter B, part 80 et seq., chapter I, Title 44, Code of Federal 
Regulations.
    (g) To loss of personal property of: (1) The insured, an officer or 
partner thereof, (2) a permanent member of the household of an insured, 
(3) an employee of an insured; provided that this exclusion does not 
apply if such personal property is used in furtherance of the conduct of 
the insured's business.
    (h) To loss of any vehicle having four or more wheels designed to be 
operated on any highway and for which a motor vehicle registration is 
required for such use.
    (i) To loss from burglary or safe burglary at any embassy or 
consulate of any government other than that of the United States.
    (j) To loss from burglary or safe burglary at any named premises 
which is vacant for a period of more than 60 days.
    (k) To loss of property of a business (other than the insured's 
business) that jointly occupies the named premises with the insured but 
whose business area is not separated from the insured's business area by 
a physical barrier. In such an instance the insured shall not be deemed 
liable to any persons for the property of the other business or 
businesses despite the location of such property in the same premises 
named by insured in his or its location.
    (l) To loss from a night depository.

                               Conditions

    1. Definitions--(a) Money. ``Money'' means currency, coins, bank 
notes, and bullion; and travelers checks, register checks, and money 
orders held for sale to the public.
    (b) Securities. ``Securities'' means all negotiable and 
nonnegotiable instruments or contracts representing either money or 
other property and includes revenue and other stamps in current use, 
tokens, and tickets, but does not include money.
    (c) Premises. ``Premises'' means the interior of that portion of any 
building at a location designated in the Application which is occupied 
by the insured as stated therein, but shall not include (1) showcases or 
show windows not opening directly into the interior of the premises, or 
(2) public entrances, halls, or stairways. As respects Insuring 
Agreements I and II only, the premises shall also include the space 
immediately surrounding such building, provided such space is occupied 
by the insured in conducting his business.
    (d) Custodian. ``Custodian'' means the insured, a partner therein, 
an officer thereof, or any employee thereof who is in the regular 
service of and duly authorized by the insured to have the care and 
custody of the insured property within the premises, excluding any 
person while acting as a watchman, porter, or janitor.
    (e) Messenger. ``Messenger'' means the insured, a partner therein, 
an officer thereof, or any employee thereof who is in the regular 
service of and duly authorized by the insured to have the care and 
custody of the insured property outside the premises. In addition 
``messenger'' includes a bonded professional guard and an employee of a 
bonded armored car service.
    (f) In conveyance. Money, securities or merchandise is in conveyance 
while being transported by the insured or his messenger. If the 
transportation is interrupted for any purpose which is not incidental to 
or in furtherance of the transportation of the money or property to its 
destination, the conveyance ceases. Any merchandise offered for sale by 
the insured or messenger at a location other than the premises named in 
the policy is not in conveyance. However, the sale of an item 
merchandise or the performance of a service, other than check cashing, 
related to the insured's business outside the premises which causes the 
insured or messenger to collect money from a customer is deemed 
incidental to and in furtherance of the transportation of money to its 
destination and the money thus collected and any other money is and 
remains in conveyance.
    Conveyance is interrupted and coverge ceases when (1) the money, 
securities or merchandise is delivered into and possession relinquished 
at any premises other than the premises named in the policy, or (2) the 
money is deposited in a bank, or (3) when an insured or a messenger 
collecting money, securities or merchandise previously accumulated for 
his pickup, from more than one location remains with such property in 
any location for any time longer than reasonably necesssary for him to 
take custody of such property, or (4) when an insured or a messenger 
transporting money, securities or merchandise willfully and knowingly 
undertakes any activity that increases the likelihood of his being 
exposed to robbery or reduces his ability to carry out his 
responsibility for the custody of the money or property.
    (g) Robbery. Robbery or robbery, including observed theft, means the 
taking of insured property (1) by violence inflicted upon a messenger or 
a custodian; (2) by putting him in fear of violence; (3) by any other 
overt felonious act committed in his presence and of which he was 
actually cognizant, provided such other act is not committed by an 
officer, partner, or employee of the insured; (4) from the person or 
direct care and custody of a messenger or custodian who has been killed 
or rendered unconscious; (5) from within the premises by compelling a 
messenger or custodian by violence or threat of violence while outside 
the premises to admit a person into the premises or to furnish him with 
means of ingress into the premises; or (6) from a showcase or show 
window within

[[Page 404]]

the premises while regularly open for business, by a person who has 
broken the glass thereof from outside the premises.
    (h) Robbery of a watchman. ``Robbery of a watchman'' means a 
felonious taking of insured property by violence or threat of violence 
inflicted upon a private watchman employed exclusively by the insured 
and while such watchman is on duty within the premises.
    (i) Burglary. Burglary or burglary and larcency incident thereto 
means the felonious abstraction of insured property from within the 
premises by a person making felonious entry therein by actual force and 
violence, evidenced by visible marks upon, or physical damage to, the 
exterior of the premises at the place of such entry.
    (j) Safe burglary. Safe burglary or safe burglary and larcency 
incident thereto means (1) the felonious abstraction of insured property 
from within a vault or safe, the door of which is equipped with a 
combination lock, located within the premises, by a person making 
felonious entry into such vault or such safe and any vault containing 
the safe, when all doors thereof are duly closed and locked by all 
combination locks thereon, provided such entry shall be made by actual 
force and violence, evidenced by visible marks upon the exterior of (a) 
all of said doors of such vault or such safe and any vault containing 
the safe, if entry is made through such doors, or (b) the top, bottom, 
or walls of such vault or such safe and any vault containing the safe 
through which entry is made, if not made through such doors, or (2) the 
felonious abstraction of such safe from within the premises.
    (k) Jewelry. ``Jewelry'' means jewelry, watches, gems, precious or 
semiprecious stones, and articles containing one or more gems.
    (l) Loss. ``Loss,'' except as used in Insuring Agreements I through 
V, includes damage.
    (m) Safe. A safe is a non-portable money storage compartment not on 
wheels, which is reinforced with a minimum of \1/4\ inch solid steel 
plate throughout, with the exception of the door which must be at least 
one inch thick, solid steel plate and equipped with a combination lock 
which is an integral part of the door.
    A Class E Safe means a steel safe having walls at least 1 inch thick 
and doors at least 1 and \1/2\ inches thick, or a vault of steel at 
least \1/2\ inch thick or of reinforced concrete or stone at least 9 
inches thick or of non-reinforced concrete or stone at least 9 inches 
thick or of non-reinforced concrete or stone at least 12 inches thick, 
with steel doors at least 1 and \1/2\ inches thick.
    (n) Merchandise includes customer's property held for repair or 
other such work.
    2. Ownership of property; interests covered. The insured property 
may be owned by the insured or held by him in any capacity, whether or 
not the insured is liable for the loss thereof: Provided, That the 
insurance applies only to the interest of the insured in such property, 
including the insured's liability to others, and does not apply to the 
interest of any other person or organization in any of said property 
unless included in the insured's proof of loss.
    3. Joint insured. If more than one insured is named in the 
Application, the insured first named shall act for every insured for all 
purposes of this Policy. Knowledge possessed or discovery made by any 
insured shall, for all purposes, constitute knowledge possessed or 
discovery made by every insured.
    4. Books and records. The insured shall keep records of all the 
insured property in such manner that the Insurer can accurately 
determine therefrom the amount of loss, and if the insured maintains 
cash funds for the purpose of check cashing, a complete record of each 
check negotiated shall be kept by the insured showing the names of the 
maker, payee and drawee bank, and the date and amount of the check, and 
such records shall be maintained in a receptacle other than used for 
money and securities.
    5. Limits of liability; settlement options. The Insurer shall not be 
liable on account of any loss unless the amount of such loss shall 
exceed the amount of the deductible described in the Application which 
is made a part of this Policy and the Insurer shall then be liable only 
for such excess over and above the deductible, subject to and within the 
limit of insurance covered by the Policy.
    The limit of the insurer's liability for loss shall not exceed the 
applicable limit of insurance stated in the Application, nor what it 
would cost at the time of loss to repair or replace the property with 
other property of like kind and quality, nor as respects securities the 
actual cash value thereof at the close of business on the business day 
next preceding the day on which the loss was discovered, nor as respects 
other property to the actual cash value thereof at the time of loss: 
provided, however, that the actual cash value of such other property 
held or originally acquired by the insured as a pledge, or as collateral 
for an advance or a loan, shall be deemed not to exceed the value of the 
property as determined and recorded by the insured when making the 
advance or loan, nor, in the absence of such record, the unpaid portion 
of the advance or loan plus accrued interest thereon at legal rates.
    The applicable limit of insurance stated in the Application is the 
total limit of the Insurer's liability with respect to all loss of 
property of one or more persons or organizations arising out of any one 
occurrence. All loss incidental to an actual or attempted fraudulent, 
dishonest or criminal act or series of related acts at the premises, 
whether committed by one or more persons, shall be deemed to arise out 
of one occurrence.

[[Page 405]]

    The Insurer may pay for the loss in money or may repair or replace 
the property and may settle any claim for loss of property either with 
the insured or the owner thereof. Any property so paid for or replaced 
shall become the property of the Insurer. Any property recovered after 
settlement of a loss shall be applied first to the expense of the 
parties in making such recovery, with any balance applied as if the 
recovery had been made prior to said settlement, and loss readjusted 
accordingly. The insured or the Insurer, upon recovery of any such 
property, shall give notice thereof as soon as practicable to the other.
    (6) Upon knowledge of loss or of an occurrence which may give rise 
to a claim for loss, the insured shall (a) give notice thereof as soon 
as practicable to law enforcement authorities and to the Insurer through 
its authorized agent and (b) file detailed proof of loss duly sworn to, 
with the insurer through its authorized agent within sixty (60) days 
after the discovery of loss unless such time is extended by the Federal 
Insurance Administrator in writing. The Administrator may, in his or her 
discretion, waive the requirement that the proof of loss be sworn to. 
Upon the insurer's request, the insured and every claimant hereunder 
shall submit to examination by the insurer, subscribe the same under 
penalty of 18 U.S.C. 1001 pertaining to fraud and false representation, 
and produce all pertinent records, all at such reasonable times and 
places as shall be designated, and shall cooperate with the insurer in 
all matters pertaining to loss or claims with respect thereto. The 
insured shall as a condition of continued coverage take reasonable 
action immediately following the discovery of a loss to protect the 
premises from further loss.''
    7. Other insurance. If there is any other valid and collectible 
insurance which would apply in the absence of this Policy, the insurance 
under this Policy shall apply only as excess insurance over such other 
insurance; Provided, that the insurance shall not apply (a) to property 
which is separately described and enumerated and specifically insured in 
whole or in part by any other insurance; or (b) to property otherwise 
insured unless such property is owned by the insured.
    8. Appraisal. If the Insured and the Insurer fail to agree as to the 
amount of loss, each shall, on the written demand of either, made within 
sixty (60) days after receipt of proof of loss by the Insurer, appoint a 
competent and disinterested appraiser, and the appraisal shall be made 
at a reasonable time and place within thirty (30) days after the two 
appraisers are appointed. If the appraisers fail to agree, they shall 
jointly select a competent and disinterested third appraiser and submit 
the question to him within fifteen (15) days thereafter. The first two 
appraisers shall state separately the actual cash value at time of loss 
and the amount of the loss. Subsequent agreement in writing by any two 
of the three appraisers within thirty (30) days after the third 
appraiser was selected shall be considered by the Insurer in determining 
the amount of the loss but shall not be considered binding upon him and 
shall not be admissible as such in court. The insured and the Insurer 
shall each pay its chosen appraiser and shall bear equally the expenses 
of the third appraiser and the other expenses of appraisal. The Insurer 
shall not be held to have waived any of its rights by any act relating 
to appraisal.
    9. Action against insurer. No action shall lie against the Insurer 
unless, as a condition precedent thereto, there shall have been 
compliance with all the terms of this Policy and the applicable 
regulations of the Federal Insurance Administration, nor until ninety 
(90) days after the required proofs of loss have been filed with the 
Insurer, nor at all unless commenced within 2 years from the date when 
the insured discovers the loss and within 1 year after the date upon 
which the claimant received written notice of disallowance or partial 
disallowance of the claim. Any such action shall be brought in a U.S. 
district court, as required by 12 U.S.C. 1749bbb-11.
    10. Subrogation. In the event of any payment under this Policy, the 
Insurer shall be subrogated to all the insured's rights of recovery 
therefor against any person or organization and the insured shall 
execute and deliver instruments and papers and do whatever else is 
necessary to secure such rights. The insured shall do nothing after loss 
to prejudice such rights.
    11. Changes. Notice to any agent or knowledge possessed by any agent 
or by any other person shall not effect a waiver or a change in any part 
of this Policy or estop the Insurer from the asserting any right under 
the terms of this Policy; nor shall the terms of this Policy be waived 
or challenged, except by endorsement issued to form a part of this 
Policy, as approved by the Federal Insurance Administrator.
    12. Cancellation. This Policy may be cancelled by the insured by 
surrender thereof to the Insurer or any of its authorized agents or by 
mailing to the Insurer written notice stating when thereafter the 
cancellation shall be effective. The grounds for cancellation of 
coverage by the Insurer shall be limited to those set forth in 
subchapter B, parts 80 et seq., chapter I, Title 44 of the Code of 
Federal Regulations. Except as otherwise provided by such regulations, 
notice of cancellation by the Insurer shall be mailed to the named 
insured at the address shown in this Policy, stating when not less than 
thirty (30) days thereafter such cancellation shall be effective. The 
mailing of notice as aforesaid shall be sufficient proof of notice. The 
time of the surrender or the effective

[[Page 406]]

date of cancellation stated in the notice shall become the end of the 
Policy period. Delivery of such written notice either by the named 
insured or by the Insurer shall be equivalent to mailing. In the event 
of cancellation, earned premium shall be computed in accordance with the 
customary short rate table and procedure, unless otherwise specifically 
provided in said Regulations issued by the Insurer. Premium adjustment 
may be made either at the time cancellation is effected or as soon as 
practicable after cancellation becomes effective, but payment or tender 
of unearned premium is not a condition of cancellation.
    13. Assignment. Assignment of interest under this Policy shall not 
bind the Insurer until its consent is endorsed hereon; if, however, the 
insured shall die, this Policy shall cover the insured's legal 
representative as insured; provided that notice of cancellation 
addressed to the insured named in the Application and mailed to the 
address shown in this Policy shall be sufficient notice to effect 
cancellation of this Policy.
    14. Declarations. By signing the Application or by acceptance of 
this Policy the insured certifies and agrees, under penalty of Federal 
law dealing with fraud and false representation (18 U.S.C. 1001), that 
the statements in the Application are his agreements and 
representations, that this Policy is issued in reliance upon the truth 
of such representations, that he is aware of the applicability of the 
regulations issued by the Insurer, and that this Policy and said 
regulations embody all agreements existing between himself and the 
Insurer or any of its agents relating to this insurance.
    In witness whereof, the Federal Insurance Administrator has accepted 
the declarations of the insured set forth in the Application and has 
caused this Policy to be issued.

&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
lowbarm;&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&l
                                                     owbarm;&lowbarm,  
                                        Federal Insurance Administrator.

    (c) Such endorsements to the Commercial Crime Insurance Policy forms 
as the insurer may approve.

[36 FR 24774, Dec. 22, 1971, as amended at 38 FR 19687, July 23, 1973. 
Redesignated at 44 FR 31177, May 31, 1979, as amended at 48 FR 19372, 
Apr. 29, 1983; 49 FR 43472, Oct. 29, 1984; 50 FR 16499, Apr. 26, 1985; 
52 FR 30687, Aug. 17, 1987; 54 FR 31684, Aug. 1, 1989]



PARTS 84-149  [RESERVED]




[[Page 407]]



                SUBCHAPTER C--FIRE PREVENTION AND CONTROL





PART 150--PUBLIC SAFETY AWARDS TO PUBLIC SAFETY OFFICERS--Table of Contents




Sec.
150.1  Background and purpose.
150.2  Definitions.
150.3  Nomination process.
150.4  Nomination and selection criteria.
150.5  Joint Public Safety Awards Board.
150.6  Design and procurement of awards.
150.7  Selection process.
150.8  Presentation of awards.
150.9  Funding.
150.10  Date of submission of nominations.

    Authority: Federal Fire Prevention and Control Act of 1974, sec. 15, 
15 U.S.C. 2214; Reorg. Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329, 
and E.O. 12127, dated Mar. 31, 1979, 3 CFR, 1979 Comp., p. 376.

    Source: 49 FR 39845, Oct. 11, 1984, unless otherwise noted.



Sec. 150.1  Background and purpose.

    The regulations in this part are issued under the authority of the 
Federal Fire Prevention and Control Act of 1974 (the Act), 15 U.S.C. 
2201 et seq. The Act establishes two classes of honorary awards for 
public safety officers and directs the issuance of the necessary joint 
regulations by the Director of the Federal Emergency Management Agency 
(FEMA) and the Attorney General. The functions of the Secretary of 
Commerce were transferred by Reorganization Plan No. 3 of 1978 to the 
Director, FEMA. Since initial passage of the Act, civil defense 
functions which then were delegated to the Secretary of Defense have 
been delegated to the Director, FEMA. Section 15 of the Act has been 
amended to delete the Secretary of Defense from participating in the 
granting of awards. See Public Law 98-241, 98 Stat. 95, 96 (1984). The 
Director, FEMA, and the Attorney General are issuing this regulation to 
implement the statutory provisions for FEMA and the Department of 
Justice.



Sec. 150.2  Definitions.

    Civil defense officer (or member of a recognized civil defense or 
emergency preparedness organization) means any individual who is 
assigned to and is performing the assigned tasks of the unit or 
organization which has been given a mission under the direction or 
operational control of a Civil Defense or Emergency Preparedness 
Director/Coordinator in accordance with a Federal, State or local 
emergency plan and sanctioned by the government concerned. This also 
includes emergency management officers. This includes volunteers and 
paid employees for any governmental entity.
    Distinguished Public Safety Service Award means the Secretary's 
Award for Distinguished Public Safety Service, presented by either the 
Attorney General or the Director of FEMA to public safety officers for 
distinguished service in the field of public safety.
    FEMA means the Federal Emergency Management Agency.
    Firefighter means a member, regardless of rank or duties, of any 
organization (including such Federal organizations) in any State 
consisting of personnel, apparatus, and equipment which has as its 
purpose protecting property and maintaining the safety and welfare of 
the public from the dangers of fire. This term includes volunteer or 
paid employees. The location of any such organization may include, but 
is not limited to, a Federal installation, a State, city, town, borough, 
parish, county, fire district, rural fire district or other special 
district.
    Joint Board means the Joint Public Safety Awards Board established 
by the Director of the Federal Emergency Management Agency and the 
Attorney General to carry out the purposes of the Federal Fire 
Prevention and Control Act of 1974.
    Law enforcement officer means a person involved in the control or 
reduction of crime and juvenile delinquency or enforcement of the 
criminal laws. This includes, but is not limited to, police, 
corrections, probation, parole, and court officers, and Federal civilian 
officers in such capacities.
    Nominating official means the head of a Federal government 
department or agency, or his delegatee(s), the governor or other head of 
a State, or the chief executive or executives of any

[[Page 408]]

general governmental unit within any State.
    President's Award means the President's Award for Outstanding Public 
Safety Service, presented by the President of the United States to 
public safety officers for extraordinary valor in the line of duty or 
for outstanding contributions to public safety.
    Public safety officer means a person serving a public agency, with 
or without compensation, as a firefighter, a civil defense officer (or 
member of a recognized civil defense or emergency preparedness 
organization), or a law enforcement officer, including a corrections or 
court officer.
    State means any State, the District of Columbia, the Commonwealth of 
Puerto Rico, the Commonwealth of the Northern Mariana Islands, the 
Virgin Islands, Guam, American Samoa, the Trust Territory of the Pacific 
Islands and any other territory or possession of the United States.



Sec. 150.3  Nomination process.

    (a) The Nominating Officials nominating Firefighters and Civil 
Defense Officers shall submit their nominations for the President's 
Award or Distinguished Public Safety Service Award to the Executive 
Secretary, Joint Public Safety Awards Board, National Emergency Training 
Center, Emmitsburg, MD 21727. Copies of all nominations shall also be 
forwarded, depending on the category of the nominee, as follows:
    (1) Firefighter: FEMA, Attention: Superintendent, National Fire 
Academy, Emmitsburg, MD 21727.
    (2) Civil defense officer (or member of a recognized civil defense 
or emergency preparedness organization): FEMA, Attention: 
Superintendent, Emergency Management Institute, Emmitsburg, MD 21727.
    (b) The Nominating Officials nominating law enforcement, corrections 
or court officers shall submit their nominations for the President's 
Award or Distinguished Public Safety Service Awards to: Assistant 
Attorney General for Administration, U.S. Department of Justice, 
Washington, DC 20530.
    (c) All nominations shall be submitted in writing in accordance with 
the requirements prescribed in this section and Sec. 150.4 at the 
earliest practicable date after the performance of the act or acts for 
which the nomination is made. Nominations for each year shall be made 
before November 15; any received thereafter will be considered as having 
been made for the following year. However, for the year 1983, 
nominations may be made by February 28, 1985.
    (d) Nominations for the President's Award or the Distinguished 
Public Safety Service Award should include the name of the candidate, 
his/her position, title and address, and public agency served, the 
locale where the candidate performs his/her duties, the name, address 
and telephone number of the nominating official, a summary describing 
the outstanding contribution, distinguished service or extraordinary 
valor, and the dates relating thereto. The description should be 
sufficiently concise and specific to justify the request for recognition 
of the public safety officer through the presentation of either of the 
awards. Copies of any published factual accounts of the nominee's 
accomplishment should also be attached when available.
    (e) An annual invitation shall be issued by the Joint Board for 
nominations for the President's Award and, on behalf of the Attorney 
General and the Director of FEMA, for the Distinguished Public Safety 
Service Award. The invitation shall be issued by letter or by notice in 
apporpriate publications of interest to the public safety community. 
However, nominating officials need not wait for such invitation but may 
nominate at the most appropriate time in accordance with the other 
provisions of this part. Approved by the Office of Management and Budget 
under Control No. 3067-0150.

[49 FR 39845, Oct. 11, 1984, as amended at 50 FR 3350, Jan. 24, 1985]



Sec. 150.4  Nomination and selection criteria.

    (a) Nominations for the President's Award of the Distinguished 
Public Safety Service Award shall be made on the basis of, and in 
conformity with, the following uniform criteria.
    (1) President's Award. Documentation accompanying the nomination for 
this Award must indicate not only that the

[[Page 409]]

nominee unquestionably meets the standards established for the 
Distinguished Public Safety Service Award (see paragraph (a)(2) of this 
section), but also deserves greater public recognition because he/she 
has demonstrated unique qualities of courage, imagination or ability, 
which have resulted in outstanding contributions to the public safety.
    (2) Distinguished Public Safety Service Award. Nomination for this 
award shall clearly show that the public safety officer's qualifying 
service or act is marked by courage, imagination or ability or has 
resulted in a significant contribution to the public safety accomplished 
through an originality of effort which far exceeds the expected quality 
of performance of the normal duties assigned to the nominee.
    (b) A nomination shall specify whether it is being submitted for the 
President's Award or the Distinguished Public Safety Award.



Sec. 150.5  Joint Public Safety Awards Board.

    (a) A Joint Public Safety Awards Board (Joint Board) is hereby 
established to fulfill the responsibilities of the Director of FEMA and 
the Attorney General by administering the process of nomination for the 
President's Award and by participating in the selection process with the 
Executive Office of the President. The Joint Board shall consist of ten 
representatives who are Federal employees and are of appropriate rank 
(at or equivalent to grades GM-14 or above). Five persons shall be named 
by and represent the Director of FEMA, and five persons shall be named 
by and represent the Attorney General. The representatives serving on 
the Joint Board shall select one of their number to act as the 
chairperson.
    (b) Representatives on the Joint Board shall serve in addition to 
their regular duties and without additional compensation. Consistent 
with the requirements of this part, the members of the Joint Board shall 
establish the procedures by which the selections for the President's 
Award shall be made to assure the timely presentation of these awards.
    (c) A National Emergency Training Center employee shall act as 
Executive Secretary of the Joint Board. The Executive Secretary shall 
perform such functions as are appropriate to the Board's 
responsibilities, including the receipt of all nominations and the 
communication of nomination information, for the purpose of receiving 
comments thereon, from members of the public safety community pursuant 
to Sec. 150.5(e). The Executive Secretary shall be appointed by the 
Associate Director, Training and Fire Programs of FEMA.
    (d) The Joint Board shall review the nomimations for the President's 
Award and shall recommend to the Director, FEMA, and the Attorney 
General by February 1 of each year, those nominees determined by it to 
merit consideration for the President's Award together with reasons 
therefor. The Director and the Attorney General shall then recommend to 
the President those nominees determined by them to merit the President's 
Award, together with the reasons therefor. Recommendations for 1983 
shall be submitted on or before March 29, 1985.
    (e) The Joint Board may request that persons representing a cross-
section of the national public safety community comment upon nominations 
made to the Board for the President's Award. Both the request for 
comments and the comments themselves shall be made in writing.

[49 FR 39845, Oct. 11, 1984, as amended at 50 FR 3350, Jan. 24, 1985]



Sec. 150.6  Design and procurement of awards.

    (a) The Joint Board shall consult with the Department of the 
Treasury and the Executive Office of the President in regard to the 
design and procurement of the appropriate citations and medal for the 
President's Award in accordance with applicable laws and regulations.
    (b) Insofar as practicable, the designs for Distinguised Public 
Safety Service Awards of FEMA and the Department of Justice shall be 
coordinate so as to avoid distinctly different recognition of the 
various public safety officers.

[[Page 410]]



Sec. 150.7  Selection process.

    (a) President's Award. Nominations for the President's Award shall 
be reviewed, and winners selected by the President (or his designee) in 
accordance with the reqirements of Sec. 150.3, the criteria in 
Sec. 150.4(a)(1), and the procedures of Sec. 150.5.
    (b) Distinguished Public Safety Service Award. Upon receipt of 
nominations for this Award, the Director of FEMA or the Attorney General 
shall cause an evaluation and selection of the nominees to be made in 
accordance with the requirements of Sec. 150.3 and the criteria 
prescribed in Sec. 150.4(a)(2). In reviewing nominations, the Attorney 
General or the Director of FEMA may request that persons representing 
the relevant segment of the national public safety community comment 
upon the nomination and accompanying documentation. Both the request for 
comments and the comments themselves shall be made in writing.
    (c) Individuals nominated for the President's Award who are 
considered not to meet the criteria for the Award by the Joint Board or 
who are not recommended to or selected by the President shall be 
automatically considered by the appropriate authority for nomination for 
the Distinguished Public Safety Service Award.
    (d) Individuals nominated for the Distinguished Public Safety 
Service Award may be considered by the Joint Board for the President's 
Award if the Director of FEMA or the Attorney General determines that 
consideration for the President's Award is merited.



Sec. 150.8  Presentation of awards.

    (a) Presentation of the President's Award shall be made at such 
time, place and circumstances as the Executive Office of the President 
directs. There shall not be more twelve President's Awards given out 
during any calendar year.
    (b) Presentation of the Distinguished Public Safety Service Award 
shall be made by the Attorney General or the Director of FEMA or a 
designee at such time, place and circumstances as the Director of FEMA 
or the Attorney General determines. There is no limit on the number of 
these awards made during any calendar year.



Sec. 150.9  Funding.

    (a) President's Award. The costs involved in designing and striking 
the medal to be presented in conjunction with the President's Award 
shall be prorated among the agencies concerned. The cost of producing 
the medal and printing the certificate shall be borne by FEMA if the 
recipient is a firefighter or a civil defense officer. If the award 
recipient is a law enforcement officer, then such cost shall be borne by 
the Department of Justice.
    (b) Distinguished Public Safety Service Award. All expenses in 
connection with this Award shall be borne by the appropriate Agency.



Sec. 150.10  Date of submission of nominations.

    Nominations may only be submitted for acts, services, or 
contributions occurring within two years preceding the November 15 cut-
off date described in Sec. 150.3(c) of this part. However, nominations 
submitted prior to the February 28, 1985 cut-off date may be made for 
acts, services or contributions occurring on or after October 29, 1972 
(two years before the effective date of the Act).

[50 FR 3350, Jan. 24, 1985]



PART 151--REIMBURSEMENT FOR COSTS OF FIREFIGHTING ON FEDERAL PROPERTY--Table of Contents




                 Subpart A--Purpose, Scope, Definitions

Sec.
151.01  Purpose.
151.02  Scope.
151.03  Definitions.

              Subpart B--Submission, Determination, Appeal

151.11  Submission of claims.
151.12  Determination of amount authorized for payment.
151.13  Reconsideration of amount authorized for payment.
151.14  Adjudication.

                  Subpart C--Administration, Penalties

151.21  [Reserved]
151.22  Audits.
151.23  Penalties.

    Authority: Secs. 11 and 21(b)(5), Federal Fire Prevention and 
Control Act of 1974 (15

[[Page 411]]

U.S.C. 2210 and 2218(b)(5)); Reorganization Plan No. 3 of 1978 (3 CFR, 
1978 Comp., p. 379) and E.O. 12127, dated Mar. 31, 1979 (3 CFR, 1979 
Comp., p. 376).

    Source: 49 FR 5929, Feb. 16, 1984, unless otherwise noted.



                 Subpart A--Purpose, Scope, Definitions



Sec. 151.01  Purpose.

    Section 11 of the Federal Fire Prevention and Control Act of 1974, 
provides that ``each fire service that engages in the fighting of a fire 
on property which is under the jurisdiction of the United States may 
file a claim with the Director of the Federal Emergency Management 
Agency for the amount of direct expenses and direct losses incurred by 
such fire service as a result of fighting such fire.'' This part, 
implements section 11 of the Act and governs the submission, 
determination, and appeal of claims under section 11.



Sec. 151.02  Scope.

    Fire services, in any State, may file claims for reimbursement under 
section 11 and this part for the direct expenses and losses which are 
additional firefighting costs over and above normal operating costs 
incurred while fighting a fire on property which is under the 
jurisdiction of the United States. Section 11 requires that certain 
payments be deducted from those costs and that the Treasury Department 
will ordinarily pay the amount resulting from the application of that 
formula. Where the United States has entered into a contract (which is 
not a mutual aid agreement, defined in Sec. 151.03) for the provision of 
fire protection, and it is the intent of the parties that reimbursement 
under section 11 is unavailable, this intent will normally govern. Where 
a mutual aid agreement is in effect between the claimant and an agency 
of the United States for the property upon which the fire occurred, 
reimbursement will be available in otherwise proper situations. However, 
any payments (including the value of services) rendered under the 
agreement during the term of the agreement (or the Federal fiscal year 
in which the fire occurred, if no term is discernible) shall be deducted 
from the costs claimed, pursuant to Sec. 151.12.



Sec. 151.03  Definitions.

    (a) The Act means the Federal Fire Prevention and Control Act of 
1974, 15 U.S.C. 2201 et seq.
    (b) Additional firefighting costs over and above normal operating 
costs means reasonable and authorized (or ratified by a responsible 
Federal official) costs ordinarily associated with the function of 
firefighting as performed by a fire service. Such costs would normally 
arise out of response of personnel and apparatus to the site of the 
fire, search and rescue, exposure protection, fire containment, 
ventilation, salvage, extinguishment, overhaul, and preparation of the 
equipment for further use. This would also include costs associated with 
emergency medical services to the extent normally rendered by a fire 
service in connection with a fire. Not included are administrative 
expenses, costs of employee benefits, insurance, disability, death, 
litigation or health care, and the costs associated with processing 
claims under section 11 of the Act and this part.
    (c) Director means the Director of the Federal Emergency Management 
Agency, or his/her designee.
    (d) Claimant means a fire service as defined in paragraph (g) of 
this section.
    (e) Direct expenses and losses means expenses and losses which would 
not have been incurred had not the fire in question taken place. This 
includes salaries for specially employed personnel, overtime pay, the 
cost of supplies expended, and the depreciated value of equipment 
destroyed or damaged. It does not include such costs as the ordinary 
wages of firefighters, overhead costs, or depreciation (if based on 
other than hours of use during fires). Expenses as defined herein would 
normally be incurred after the first call or alarm and would normally 
cease upon the first of the following: Return to station, report in-
service and ready for further operations, or commence response to 
another incident.
    (f) Fire means any instance of destructive or uncontrolled burning, 
including scorch burns and explosions of combustible dusts or solids, 
flammable liquids, and gases. The definition does

[[Page 412]]

not include the following except where they cause fire or occur as a 
consequence of fire: Lightning or electrical discharge, explosion of 
steam boilers, hot water tanks, or other pressure vessels, explosions of 
ammunition or other detonating materials, overheating, mechanical 
failures, or breakdown of electrical equipment in power transmission 
facilities, and accidents involving ships, aircraft, or other vehicles. 
Not included in this definition are any costs associated with false 
alarms, regardless of cause.
    (g) Fire service means any organization in any State consisting of 
personnnel, apparatus, and equipment which has as its purpose protecting 
property and maintaining the safety and welfare of the public from the 
dangers of fire, including a private firefighting brigade. The personnel 
of any such organization may be paid employees or unpaid volunteers or 
any combination thereof. The location of any such organization and its 
responsibility for extinguishment and suppression of fires may include, 
but need not be limited to, a State, city, town, borough, parish, 
county, fire district, fire protection district, rural fire district, or 
other special district.
    (h) Mutual aid agreement means any reciprocal agreement whether 
written or oral between a Federal agency and the claimant fire service, 
or its parent jurisdiction, for the purpose of providing fire protection 
for the property of the United States upon which the fire which gave 
rise to the claim occurred and for other property for which the claimant 
normally provides fire protection. Such agreement must be primarily one 
of service rendered for service, or must be entered into under 42 U.S.C. 
1856 through 1856d. Not included are all other agreements and contracts, 
particularly those in which the intent of the parties is that the United 
States pays for fire protection.
    (i) FEMA means the Federal Emergency Management Agency.
    (j) Over and above normal operating expenses means costs, losses and 
expenses which are not ordinarily and necessarily associated with the 
maintenance, administration, and day-to-day operations of a fire service 
and which would not have been incurred absent the fire out of which the 
claim arises.
    (k) Payments to the fire service or its parent jurisdiction, 
including taxes or payments in lieu of taxes, the United States has made 
for the support of fire services on the property in question means any 
Federal monies, or the value of services, including those made available 
through categorical or block grants, contracts, mutual aid agreements, 
taxes, and payments in lieu of taxes which the United States has paid to 
the fire service or its parent jurisdiction for fire protection and 
firefighting services. Such payments will be determined on the basis of 
the term of the arrangement, or if no such term is discernible, on the 
basis of the Federal fiscal year in which the fire occurred.
    (l) Property which is under the jurisdiction of the United States 
means real property and Federal improvements thereon and appurtenances 
thereto in which the United States holds legal fee simple title. This 
excludes Federal leasehold interests. This likewise excludes Federal 
personal property on land in which the United States does not hold fee 
simple title.
    (m) State means any State of the United States of America, the 
District of Columbia, the Commonwealth of Puerto Rico, the Virgin 
Islands, Guam, American Samoa, The Commonwealth of the Northern Mariana 
Islands, the Trust Territory of the Pacific Islands, and any other 
territory or possession of the United States.



              Subpart B--Submission, Determination, Appeal



Sec. 151.11  Submission of claims.

    Any fire service in any State which believes it has a claim(s) 
cognizable under section 11 shall submit its claim(s) in writing within 
90 days of the occurrence of the fire(s) for which a claim(s) is made. 
If the fire is of such duration that the claimant desires to submit a 
claim before its conclusion, it may do so, but only for the eligible 
costs actually incurred to date. Additional claims may be filed for 
costs

[[Page 413]]

later incurred. Claims shall be submitted to the Director, FEMA, 
Washington, DC, 20472. Each claim shall include the following 
information:
    (a) Name, address, jurisdiction and nature (volunteer, private, 
municipal, etc.) of claimant's fire service organization;
    (b) Name, title, address and telephone number of individual 
authorized by the claimant fire service to make this claim in its behalf 
and his/her certification as to the accuracy of the information 
provided;
    (c) Name and telephone number of Federal employee familiar with the 
facts of the event and the name and address of the Federal agency having 
jurisdiction over the property on which the fire occurred;
    (d) Proof of authority to fight the fire (source of alarm, whether 
fire service was requested by responsible Federal official or whether 
such an official accepted the assistance when offered);
    (e) Personnel and equipment committed to fighting of fire (type of 
equipment and number of items); and an itemized list of direct expenses 
(e.g., hours of equipment operation, fuel costs, consumables, overtime 
pay and wages for any specially hired personnel) and direct losses 
(e.g., damaged or destroyed equipment, to include purchase cost, 
estimate of the cost of repairs, statement of depreciated value 
immediately preceding and subsequent to the damage or destruction and 
the extent of insurance coverage) actually incurred in fighting the 
fire. A statement should be included explaining why each such expense or 
loss is considered by the claimant not be a normal operating cost, or to 
be in excess of normal operating costs;
    (f) Copy of fire report which includes the location of the fire, a 
description of the property burned, the time of alarm, etc.;
    (g) Such other information or documentation as the Director 
considers relevant to those considerations to be made in determining the 
amount authorized for payment, as set forth in Sec. 151.12 of these 
regulations;
    (h) Source and amount of any payments received or to be received for 
the fiscal year in which the fire occurred, including taxes or payments 
in lieu of taxes and including all monies received or receivable from 
the United States through any program or agreement including categorical 
or block grants, and contracts, by the claimant fire service or its 
parent jurisdiction for the support of fire services on the property on 
which the fire occurred. If this information is available when the claim 
is submitted, it should accompany the claim. If it is not, the 
information should be submitted as soon as practicable, but no later 
than 15 days after the end of the Federal fiscal year in which the fire 
occurred.

(Approved by Office of Management and Budget under control number 3067-
0141)



Sec. 151.12  Determination of amount authorized for payment.

    (a) The Director shall determine the amount to be paid on a claim 
(subject to payment by the Department of the Treasury). The amount to be 
paid is the total of eligible expenses, costs and losses under paragraph 
(a)(1) of this section which exceeds the amount of payments under 
paragraph (a)(2) of this section. The Director shall establish the 
reimbursable amount by determining:
    (1) The extent to which the fire service incurred additional 
firefighting costs, over and above its normal operating costs, in 
connection with the fire which is the subject of the claim, i.e., the 
``amount of costs''; and
    (2) What payments, if any, including taxes or payments in lieu of 
taxes, the fire service or its parent jurisdiction has received from the 
United States for the support of fire services on the property on which 
the fire occurred.

The reimbursable amount is the amount, if any, by which the amount of 
costs, determined under paragraph (a)(1) of this section exceeds the 
amount of payments determined under paragraph (a)(2) of this section. 
Where more than one claim is filed the aggregate reimbursable amount is 
the amount by which the total amount of costs, determined under 
paragraph (a)(1) of this section exceed the amount of Federal payments 
(in the case of a mutual aid agreement--its term or if

[[Page 414]]

none is determinable, the Federal fiscal year) determined under 
paragraph (a)(2) of this section.
    (b) The Director will first determine the costs as contemplated in 
paragraph (a)(1) of this section. The Director will then notify the 
claimant as to that amount. The claimant must indicate within 30 days 
its acceptance or rejection of that amount.
    (1) If the determination is accepted by the claimant, this will be 
the final and conclusive determination of the amount of costs by the 
claimant in conjunction with the fire for which the claims are 
submitted.
    (2) If the claimant rejects this amount, it must notify the 
Director, within 30 days, of its reasons for its rejection. Upon receipt 
of notification of rejection, the Director shall reconsider his 
determination and notify the claimant of the results of the 
reconsideration. The amont determined on reconsideration will constitute 
the costs to be used by the Director in determining the reimbursable 
amount.
    (c) Upon receipt of documentation from the claimant on the amount of 
payments the Federal Government has made for the support of fire 
services on the property in question, the Director will, following such 
verification or investigation as the Director may deem appropriate, 
calculate the full amount to be reimbursed under the section 11 formula 
as set forth in Sec. 151.12(a). This calculation of the reimbursable 
amount is based upon the costs determined pursuant to Sec. 151.12(b) and 
the documentation of Federal payments that the claimant submitted.
    (d) The Director's determination of the reimbursable amount will be 
sent to the Secretary of the Treasury. The Secretary of the Treasury 
shall, upon receipt of the claim and determination made under 
Sec. 151.12 (a), (b), and (c), determine the amount authorized for 
payment, which shall be the amount actually available for payment from 
any monies in the Treasury not otherwise appropriated but subject to 
reimbursement (from any appropriations which may be available or which 
may be made available for the purpose) by the Federal department or 
agency under whose jurisdiction the fire occurred. This shall be a sum 
no greater, although it may be less, that the reimbursable amount 
determined by the Director, FEMA, with respect to the claim under 
Sec. 151.12 (a), (b) and (c).
    (e) Upon receipt of written notification from the claimant of its 
intention to accept the amount authorized as full settlement of the 
claim, accompanied by a properly executed document of release, the 
Director will forward the claim, a copy of the Director's determination 
and the claimant's document of release to the Secretary of the Treasury 
for payment of the claim in the amount authorized.
    (f) Subject to the discovery of additional material evidence, the 
Director may reconsider any determination in this section, whether or 
not made as his final determination.

[49 FR 5929, Feb. 16, 1984, as amended at 49 FR 38119, Sept. 27, 1984]



Sec. 151.13  Reconsideration of amount authorized for payment.

    (a) If the claimant elects to protest the amount authorized for 
payment, after the applicable procedures of Sec. 151.12 have been 
followed, it must within 30 days of receipt of notification of the 
amount authorized notify the Director in writing of its objections and 
set forth the reasons why the Director should reconsider the 
determination. The Director will upon notice of protest and receipt of 
additional evidence reconsider the determination of the amount of 
Federal payments under Sec. 151.12(a)(2) but not the determination of 
the amount of costs under Sec. 151.12(a)(1). The Director shall cause a 
reconsideration by the Secretary of the Treasury of the amount actually 
available and authorized for payment by the Treasury. The Director, upon 
receipt of the Secretary of the Treasury's reconsidered determination, 
will notify the claimant in writing of the amount authorized, upon 
reconsideration, for payment in full settlement of the claim.
    (b) If the claimant elects to accept the amount authorized, upon 
reconsideration, for payment in full settlement of its claims, it must 
within 30 days (or a longer period of time acceptable to the Director) 
of its receipt of that determination notify the Director of its 
acceptance in writing accompanied by

[[Page 415]]

a properly executed document of release. Upon receipt of such notice and 
document of release, the Director will forward the claim, a copy of the 
Director's final determination, and the claimant's document of release 
to the Secretary of the Treasury for payment of the claim in the amount 
of final authorization.



Sec. 151.14  Adjudication.

    If the claimant, after written notice by the Director of the amount 
authorized for payment in full settlement of the claim and after all 
applicable procedures of Secs. 151.12 and 151.13 have been followed 
elects to dispute the amount authorized, it may then initiate action in 
the United States Claims Court, which shall have jurisdiction to 
adjudicate the claim and enter judgment in accordance with section 11(d) 
of the Act.



                  Subpart C--Administration, Penalties



Sec. 151.21  [Reserved]



Sec. 151.22  Audits.

    At the discretion of the Director, all claims submitted under 
section 11 of the Act and all records of the claimant will be subject to 
audit by the Director or his/her designee. In addition, the Comptroller 
General of the United States or his/her designee shall have access to 
all books and records of all claimants making claims under section 11.



Sec. 151.23  Penalties.

    Claimant's officials or others who provide information or 
documentation under this part are subject to, among other laws, the 
criminal penalties of Title 18 of the United States Code, sections 287 
and 1001, which punish the submission of false, fictitious or fraudulent 
claims and the making of false, fictitious or fraudulent statements and 
which provide for a fine of not more than $10,000 or imprisonment for 
not more than five years, or both. For such a violation, the person is 
likewise subject to the civil penalties set out in 31 U.S.C. 3729 and 
3730.



PART 152--STATE GRANTS FOR ARSON RESEARCH, PREVENTION, AND CONTROL--Table of Contents




                 Subpart A--Purpose, Scope, Definitions

Sec.
152.1  Purpose.
152.2  Scope.
152.3  Definitions.

                   Subpart B--Competitive State Grants

152.4  Grant goals.
152.5  State qualification criteria.
152.6  Grant application procedures.
152.7  Available funds and application submission.
152.8  Competitive evaluation criteria.
152.9  Reporting requirements.

                        Subpart C--Administration

152.10  Extension.
152.11  Technical assistance.
152.12  Consultation and cooperation.
152.13  Audits.
152.14  Penalties.

    Authority: 15 U.S.C. 2221; Reorganization Plan No. 3 of 1978, 43 FR 
41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 CFR, 1979 
Comp., p. 376.

    Source: 60 FR 11236, Mar. 1, 1995, unless otherwise noted.



                 Subpart A--Purpose, Scope, Definitions



Sec. 152.1  Purpose.

    This part establishes the uniform administrative rules under which 
States or consortia of States will request consideration for competitive 
arson research, prevention and control grant award(s), and details the 
associated administrative procedures which will be required of 
applicants and recipients.



Sec. 152.2  Scope.

    This part applies to all States or consortia of States requesting 
competitive consideration of their respective proposals, and all those 
States or consortia of States actually awarded arson grants under this 
authority.



Sec. 152.3  Definitions.

    Administrative costs means those actual expenses incurred by a 
grantee to oversee and execute the specific administrative provisions of 
the grant award,

[[Page 416]]

including as appropriate the provision of grant related monitoring 
services and reporting requirements, and the nominal purchase of 
necessary equipment and expendable supplies to support the 
administration of the grant.
    Administrator means the Administrator of the United States Fire 
Administration.
    Grantee means the State, consortia of States, or State and consortia 
of States identified as recipients of grant awards under this part.
    Prevention and control means the aggressive intervention strategies, 
methods, and materials developed or relied upon to minimize the 
occurrence and effects of arson.
    Program costs means the actually incurred expenses related to the 
development, delivery, training, research or other activities proposed 
and subsequently authorized by the grant award and other appropriate 
controls.
    Reporting methodology is the means by which a jurisdiction provides 
arson data to the National Fire Incident Reporting System (NFIRS) or the 
Uniform Crime Reporting (UCR) programs.
    Research means the application of conventional scientific and 
statistical methods to assess a particular issue, application 
methodology, intervention or mitigation strategy in an effort to advance 
the collective scientific body of knowledge related to the nation's 
arson problem.
    Resources means tangible capability enhancements including but not 
limited to the purchase of program related equipment, services, 
materials, and expendable supplies.
    Responsible official means the individual specifically authorized to 
act as the accountable Agent of the State for purposes of administering 
the grants awarded under this part.
    State means any State, the District of Columbia, the Commonwealth of 
Puerto Rico, the Virgin Islands, the Canal Zone, Guam, American Samoa, 
the Trust Territory of the Pacific Islands, and any other territory or 
possession of the United States.
    State consortia means a cooperative and collective group of more 
than one State, (or State equivalents as noted above).



                   Subpart B--Competitive State Grants



Sec. 152.4  Grant goals.

    Grant applications for these grant awards must promote one or more 
of the following 10 goals:
    (a) To improve the training by States leading to professional 
certification of arson investigators in accordance with nationally 
recognized certification standards. Certification of arson investigators 
is to be accomplished in accordance with State guidelines, by 
appropriate State authorities.
    (b) To provide resources for the formulation of arson task forces or 
interagency organizational arrangements involving police and fire 
departments and other relevant local agencies, such as a State arson 
bureau and the office of a fire marshal of a State.
    (c) To combat fraud as a cause of arson, and to advance research at 
the State and local levels on the significance and prevention of fraud 
as a motive for setting fires.
    (d) To provide for the management of arson squads including:
    (1) Training courses for fire departments in arson case management 
including standardization of investigative techniques and reporting 
methodology;
    (2) The preparation of arson unit management guides; and
    (3) The development and dissemination of new public education 
materials relating to the arson problem; proposals should address all 
three subactivities in support of the management of an arson squad.
    (e) To combat civil unrest as a cause of arson, and to advance 
research at the State and local levels on the prevention and control of 
arson linked to urban disorders.
    (f) To combat juvenile arson, such as juvenile fire setter 
counseling programs and similar intervention programs, and to advance 
research at the State and local levels on the prevention of juvenile 
arson.
    (g) To combat drug-related arson, and to advance research at the 
State and local levels on the causes and prevention of drug-related 
arson.
    (h) To combat domestic violence as a cause of arson, and to advance 
research

[[Page 417]]

at the State and local levels on the prevention of arson arising from 
domestic violence.
    (i) To combat arson in rural areas and to improve the capability of 
firefighters to identify and prevent arson initiated fires in rural 
areas and public forests.
    (j) To improve the capability of firefighters to identify and combat 
arson through expanded training programs, including:
    (1) Training courses at the State fire academies; and
    (2) Innovative courses at the National Fire Academy (NFA) and made 
available to volunteer firefighters through regional delivery methods, 
including teleconferencing and satellite delivered television programs.
    (k) Proposals addressing goals in paragraphs (a), (i), and (j) of 
this section would be encouraged to rely, at least in part on training 
course materials and offerings currently available through the NFA. 
Proposals should specifically identify which training components would 
be utilized and how they would be delivered. In the event Course 
content, other than that available from the NFA is proposed, the 
applicant will include copies of the proposed training materials with 
the proposal.
    (l) In addition, applicants should make specific reference in their 
proposal(s) as to those efforts being made to provide improved and more 
widely available arson training courses which demonstrate particular 
emphasis on the needs of volunteer firefighters.



Sec. 152.5  State qualification criteria.

    Each State or consortium of States will demonstrate by appropriate 
means and provide such assurances as are deemed adequate by the 
Administrator that the State, or consortium of States:
    (a) Will obtain at least 25 percent of the cost(s) funded by the 
grant, in cash or in kind, from non-Federal sources.
    (1) State's contribution. Applicants will identify the source and 
amount of their respective contribution (in cash or in kind) in the work 
plan and budget detail sections of the application.
    (2) Cash contributions will be sourced or certified by responsible 
authority to be derived entirely from non-Federal sources.
    (3) In kind contributions will be specifically detailed and clearly 
demonstrate the type, nature, value and quantity of the contribution 
offered to satisfy this requirement. The applicant(s) may offer current 
staff in support of the contribution requirement, insofar as the 
offering would not effect the restriction against decreasing the prior 
levels of spending detailed in paragraph (b) of this section.
    (4) In kind contributions will also be sourced and certified to be 
derived from non-Federal sources.
    (b) Will not as a result of receiving the grant decrease the prior 
level of spending of funds of the State or consortium from non-federal 
sources for arson research, prevention, and control programs. The 
applicant(s) will provide a concise overview of the level of funding 
dedicated to these areas for each of the two previous fiscal years. This 
information will be included in the grant file and is subject to post 
audit reviews. The applicant's responsible official will provide 
appropriate certification that the recipient is cognizant of this 
condition of award, and that no diminution of funding is to result in 
such anti-arson efforts in the event of a grant award. Violation of this 
grant award condition may subject the recipient to termination of the 
grant, and forfeiture of unused portions of grant funds, and other 
applicable administrative or criminal sanctions.
    (c) Will use no more than 10 percent of the funds provided under the 
grant for administrative costs of the programs. Actual administrative 
cost incurred, not to exceed 10 percent for the funds provided, may be 
funded through the grant. It is recognized that the administrative costs 
may exceed the allocation limit, in such cases the additional expense 
will be born by the recipient. Excess administrative costs will not be 
considered part of the recipients required `contribution' as noted in 
paragraph (a) of this section; and
    (d) Is making efforts to ensure that all local jurisdictions will 
provide arson data to the National Fire Incident Reporting System 
(NFIRS) or the

[[Page 418]]

Uniform Crime Reporting (UCR) program.
    (1) The State, or consortia of States, will provide, as part of the 
application process, such information as will describe its current 
efforts to ensure that all local jurisdictions will provide data to 
NFIRS or UCR.
    (2) This description should include the current level of local 
jurisdiction participation in each of the respective data collection 
programs. It should detail the State's reporting criteria, and data 
collection requirements, and statutory reporting mandates, if 
applicable. It should specifically identify the constructive efforts 
(both incentives and penalties to local jurisdiction's participation) 
underway to achieve complete reporting, and identify the actions, if 
any, to be taken under the proposed grant to achieve the participation 
target; and
    (e) Has a policy to promote actively the training of its 
firefighters in cardiopulmonary resuscitation (CPR). The applicant(s) 
may demonstrate their fulfillment of this requirement by providing a 
true copy of the policy with the proposal, or by such other means as 
would reasonably attest to the applicant's active promotion of CPR 
training for all firefighters.



Sec. 152.6  Grant application procedures.

    (a)(1) Applicants, both singly and in consortia, must format their 
proposals so as to assure the grant goal(s) identified in Sec. 152.4 are 
clearly addressed and that the work plan descriptions of the level of 
effort, program activity, and program budgets are specific to each of 
the selected target goals.
    (2) The legislation directs that awards be made in support of each 
of the ten (10) goals enumerated in Sec. 152.4. The competitive 
evaluation of the proposals will be done on a goal by goal basis, and 
the grant awards will be made accordingly. In effect, all of the 
proposals received that address, for example Sec. 152.4(a), will be 
reviewed against the competitive evaluation criteria detailed in 
Sec. 152.8 in relation to achieving that goal. The best overall proposal 
will be the recipient of the award. Each of the other proposals offered 
in support of each of the other goals will likewise be assessed. The 
State or consortia of States may submit proposals addressing more than 
one of the goals. Applicants must however insure that the proposal 
detail is separable in its entirety, goal by goal. States, or consortia 
of States, applying for the competitive grants available under this 
section will comply with and are bound by all of the applicable 
provisions of 44 CFR parts 13 and 14 with respect to the Uniform 
Administrative Requirements for Grants to State Governments, and the 
Administration of Grants: Audits of State Governments.
    (b) The application will identify the requestor's status as a:
    (1) State; or
    (2) Consortium of States, (detailing each of the States in the 
consortium).
    (c) The application will specifically identify both the responsible 
State organizational element (e.g., the Office of the State Fire 
Marshal) and the responsible Official/Individual who will administer the 
grant in the event of an award. Grant requests from consortia of States 
will include this information for each of the States, and will identify 
which one of these responsible Officials will serve as the grant's 
administrative coordinator with USFA.
    (d) The information provided will include the following:
    (1) The applicant's complete organizational title;
    (2) The applicant's complete mailing address;
    (3) The name and title of the State's designated responsible 
Official;
    (4) The responsible Official's complete mailing address; and
    (5) The responsible Official's telephone and facsimile numbers.
    (e) The application will indicate specifically which of the 10 grant 
goals in Sec. 152.4 the proposed grant activities are intended to 
address. Consortia proposals may propose that each of the consortia 
States address a particular goal or group of goals singularly, or the 
States may approach the selected goals, in part or in whole, 
collectively.
    (f) The application will provide specific work plans which detail 
the means by which the applicant(s) intends to pursue the selected 
goal's attainment through the grant. The work

[[Page 419]]

plan will include the overall level of effort envisioned as a result of 
the proposed grant's implementation, the specific tasks and time lines 
to be accomplished, the resources both human and material that will be 
applied to the effort (including the means by which the utilization of 
these resources will be accounted for), and the means and methods that 
will be utilized to assess and evaluate the accomplishment of the 
targeted goals.
    (g) Each applicant will submit a detailed grant program budget which 
addresses, by goal specific reference, how the grant funds, both 
administrative and programmatic, will be disbursed. The grant proposal 
budget element will specifically distinguish between ``administrative 
costs'' and ``program costs'' consistent with the requirements noted 
herein. No more than 10 percent of the funds provided under the grant 
will be used for the administrative costs of the program. This 
restriction does not preclude the applicant(s) from proposing a greater 
level of effort or resource dedication to administrative activity, it 
simply limits the costs to be supported through the grant funding. Each 
of the States in a consortium may request support for actual 
administrative costs of no more than 10 percent of its respective 
program expenses.



Sec. 152.7  Available funds and application submission.

    (a) Funds may be appropriated in Fiscal Year 1995 to support grant 
awards addressing the ten (10) goals of Sec. 152.4. No grant awards 
would be made in Fiscal Year 1995 or future years unless and until funds 
are appropriated.
    (b) Reasonable efforts will be made to award a grant addressing each 
of the enumerated goals in an expeditious manner. Upon completion of the 
initial competitive evaluations and the resulting grant awards, any 
goal(s) yet unattended will be identified and may become the subject of 
a second round of applications solicitation, consideration and grant 
award(s). Grant proposals should be formatted to address specifically 
the incremental use of the currently available (FY 1995) funds, and 
target the possible use of FY 1996 funds if made available, as logical 
programmatic extensions or replications of the activities proposed and 
supported by FY 1995 funds.
    (c) Following the comment period and the publishing of the final 
rule incorporating these procedures, a formal announcement of grant 
availability will be issued in the Federal Register. Applicants will be 
afforded a period of not less than 30 and not more than 45 days, 
following the formal announcement, to submit applications. It is 
anticipated that the initial grant awards will be made during the first 
quarter of calendar year 1995. In the event awards are not made in 
support of each of the ten goals, a second Notice of Availability, 
addressing the unattended goals, may be published in the Federal 
Register and awards will be targeted to occur before September 30, 1995.



Sec. 152.8  Competitive evaluation criteria.

    Each grant application/program proposal received will be 
competitively assessed against the following criteria:
    (a) The degree to which the proposal is seen to address the targeted 
goal or each goal in a combination of goals;
    (b) The scope and effect of the proposed initiative in relation to 
the proposed program cost;
    (c) The degree to which the proposed activity supports a ``model 
program initiative'' suitable for replication in other jurisdictions;
    (d) The degree to which the proposed activity demonstrates an 
effective and efficient integration of a variety of program resources;
    (e) The degree to which the proposed activity could sustain itself 
upon the completion of the grant performance period;
    (f) The degree to which the proposed activity would target 
intervention strategies addressing high-risk groups, properties, or 
specific conditions.
    (g) The degree to which the activity proposed would produce a 
lasting antiarson program, initiative, or other such appropriate 
outcome;
    (h) The degree to which the proposed activity promotes the 
introduction of new technology, innovative techniques, or nontraditional 
approaches to reduce the nation's arson problem;

[[Page 420]]

    (i) The degree to which the proposed activity relies upon the 
development of intergovernmental, interorganizational, or community 
involving ``partnerships'' to promote goal attainment; and
    (j) The degree to which the proposed activity supports the enhanced 
ability to collect arson data.



Sec. 152.9  Reporting requirements.

    (a) Each State, or consortium of States, which is the recipient of a 
grant under this authority, by acceptance of the award, agrees to 
provide to the satisfaction of the Administrator and in timely fashion, 
any and all such documentation as may be requested or required to detail 
the methods and amounts of grant funds disbursement and such other 
record keeping, retention of records and the additional provision of 
information by the Grantee as may be required by the awarding Agency and 
applicable regulation.
    (b) The reporting requirements will consist of primarily the two 
following types:
    (1) Quarterly progress and financial status reports; and
    (2) Final progress report and financial status report. The final 
progress report will include a summary evaluation of the program related 
activities under the grant. It will identify the evaluation methodology 
and the assessment values applied to critique the grant's effectiveness 
in relation to achieving the targeted goal(s).



                        Subpart C--Administration



Sec. 152.10  Extension.

    The Administrator has discretionary authority to extend the duration 
of grants made under this part for one or more additional periods. Grant 
recipients desiring an extension of the grant performance period, will 
request such extensions in writing at least sixty (60) days prior to the 
expiration of the grant period. The request will include the reason for 
the requested extension, a description of the effect(s) on the program 
if the extension is not granted, and a statement that no additional 
federal funds would be necessary to support the grant activities during 
the extension period. Grant extension requests may not be utilized to 
request additional funding.



Sec. 152.11  Technical assistance.

    The Administrator shall provide technical assistance to States in 
carrying out the program(s) funded by grants under the Act. This 
assistance will consist of providing the customary and usual information 
on the application process, deadlines, program and financial reporting 
requirements, and related grant program activities support. This 
provision is not intended to suggest that USFA will provide other than 
grant related support and technical assistance. Grant proposals should 
not suggest or rely upon other program related services, staff support 
or monies from USFA to be any part of the proposed grant activities, 
except as provided in this part.



Sec. 152.12  Consultation and cooperation.

    The Administrator would consult and cooperate with other Federal 
agencies to enhance program effectiveness and avoid duplication of 
effort, including the conduct of regular meetings initiated by the 
Administrator with representatives of other Federal agencies concerned 
with arson and concerned with efforts to develop a more comprehensive 
profile of the magnitude of the national arson problem.



Sec. 152.13  Audits.

    In accordance with applicable regulations, all the grants awarded 
under this part and all records of the recipient would be subject to 
audit by appropriate Federal Emergency Management Agency staff or other 
responsible authority.



Pts. 153-199  Penalties.

    The recipient designated responsible official or others who provide 
information or documentation to federal officials in connection with the 
activities or funds authorized by or expended through these grants are 
subject to, among other laws, the criminal penalties of 18 U.S.C. 287 
and 1001, which punish the submission of false, fictitious or fraudulent 
claims and the making of false, fictitious or fraudulent statements. 
Such actions are punishable by the imposition of a fine not

[[Page 421]]

to exceed $10,000.00 or imprisonment for not more than five (5) years, 
or both. Such a violation may also subject the responsible official to 
the civil penalties set out in 31 U.S.C. 3729 and 3730.



PARTS 153-199 [RESERVED]




[[Page 422]]



                    SUBCHAPTER D--DISASTER ASSISTANCE





PARTS 200-201 [RESERVED]






PART 206--FEDERAL DISASTER ASSISTANCE FOR DISASTERS DECLARED ON OR AFTER NOVEMBER 23, 1988--Table of Contents






                           Subpart A--General

Sec.
206.1  Purpose.
206.2  Definitions.
206.3  Policy.
206.4  State emergency plans.
206.5  Assistance by other Federal agencies.
206.6  Donation or loan of Federal equipment and supplies.
206.7  Implementation of assistance from other Federal agencies.
206.8  Reimbursement of other Federal agencies.
206.9  Nonliability.
206.10  Use of local firms and individuals.
206.11  Nondiscrimination in disaster assistance.
206.12  Use and coordination of relief organizations.
206.13  Standards and reviews.
206.14  Criminal and civil penalties.
206.15  Recovery of assistance.
206.16  Audit and investigations.
206.17  Effective date.
206.18-206.30  [Reserved]

                   Subpart B--The Declaration Process

206.31  Purpose.
206.32  Definitions.
206.33  Preliminary damage assessment.
206.34  Request for utilization of Department of Defense (DOD) 
          resources.
206.35  Requests for emergency declarations.
206.36  Requests for major disaster declarations.
206.37  Processing requests for declarations of a major disaster or 
          emergency.
206.38  Presidential determination.
206.39  Notification.
206.40  Designation of affected areas and eligible assistance.
206.41  Appointment of disaster officials.
206.42  Responsibilities of coordinating officers.
206.43  Emergency support teams.
206.44  FEMA-State Agreements.
206.45  Loans of non-Federal share.
206.46  Appeals.
206.47-206.60  [Reserved]

                     Subpart C--Emergency Assistance

206.61  Purpose.
206.62  Available assistance.
206.63  Provision of assistance.
206.64  Coordination of assistance.
206.65  Cost sharing.
206.66  Limitation on expenditures.
206.67  Requirement when limitation is exceeded.
206.68-206.100  [Reserved]

                 Subpart D--Temporary Housing Assistance

206.101  Temporary housing assistance.
206.102-206.130  [Reserved]

             Subpart E--Individual and Family Grant Programs

206.131  Individual and family grant programs.
206.132-206.140  [Reserved]

                 Subpart F--Other Individual Assistance

206.141  Disaster unemployment assistance.
206.142-206.150  [Reserved]
206.151  Food commodities.
206.152-206.160  [Reserved]
206.161  Relocation assistance.
206.162-206.163  [Reserved]
206.164  Disaster legal services.
206.165-206.170  [Reserved]
206.171  Crisis counseling assistance and training.
206.172-206.180  [Reserved]
206.181  Use of gifts and bequests for disaster assistance purposes.
206.182-206.190  [Reserved]
206.191  Duplication of benefits.
206.192-206.199  [Reserved]

           Subpart G--Public Assistance Project Administration

206.200  General.
206.201  Definitions.
206.202  Application procedures.
206.203  Federal grant assistance.
206.204  Project performance.
206.205  Payment of claims.
206.206  Appeals.
206.207  Administrative and audit requirements.
206.208  Direct Federal assistance.
206.209-206.219  [Reserved]

                Subpart H--Public Assistance Eligibility

206.220  General.
206.221  Definitions.
206.222  Applicant eligibility.
206.223  General work eligibility.
206.224  Debris removal.
206.225  Emergency work.
206.226  Restoration of damaged facilities.

[[Page 423]]

206.227  Snow assistance.
206.228  Allowable costs.
206.229-206.249  [Reserved]

           Subpart I--Public Assistance Insurance Requirements

206.250  General.
206.251  Definitions.
206.252  Insurance requirements for facilities damaged by flood.
206.253  Insurance requirements for facilities damaged by disasters 
          other than flood.
206.254-206.339  [Reserved]

                Subpart J--Coastal Barrier Resources Act

206.340  Purpose of subpart.
206.341  Policy.
206.342  Definitions.
206.343  Scope.
206.344  Limitations on Federal expenditures.
206.345  Exceptions.
206.346  Applicability to disaster assistance.
206.347  Requirements.
206.348  Consultation.
206.349  Consistency determinations.
206.350-206.359  [Reserved]

                   Subpart K--Community Disaster Loans

206.360  Purpose.
206.361  Loan program.
206.362  Responsibilities.
206.363  Eligibility criteria.
206.364  Loan application.
206.365  Loan administration.
206.366  Loan cancellation.
206.367  Loan repayment.
206.368-206.389  [Reserved]

                 Subpart L--Fire Suppression Assistance

206.390  General.
206.391  FEMA-State Agreement.
206.392  Request for assistance.
206.393  Providing assistance.
206.394  Cost eligibility.
206.395  Grant administration.
206.396-206.399  [Reserved]

                  Subpart M--Hazard Mitigation Planning

206.400  General.
206.401  Definitions.
206.402  Responsibilities.
206.403  Pre-declaration activities.
206.404  Mitigation survey teams.
206.405  Hazard mitigation plan.
206.406  Hazard mitigation planning process.
206.407  Minimum standards.

               Subpart N--Hazard Mitigation Grant Program

206.430  General.
206.431  Definitions.
206.432  Federal grant assistance.
206.433  State responsibilities.
206.434  Eligibility.
206.435  Project identification and selection criteria.
206.436  Application procedures.
206.437  State administrative plan.
206.438  Project management.
206.439  Allowable costs.
206.440  Appeals.

    Authority: The Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, 42 U.S.C. 5121 et seq.; Reorganization Plan No. 3 of 
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR 19367, 3 
CFR, 1979 Comp., p. 376; E.O. 12148, 44 FR 43239, 3 CFR, 1979 Comp., p. 
412; and E.O. 12673, 54 FR 12571, 3 CFR, 1989 Comp., p. 214.

    Source: 54 FR 11615, Mar. 21, 1989, unless otherwise noted.



                           Subpart A--General

    Source: 55 FR 2288, Jan. 23, 1990, unless otherwise noted.



Sec. 206.1  Purpose.

    (a) Purpose. The purpose of this subpart is to prescribe the 
policies and procedures to be followed in implementing those sections of 
Public Law 93-288, as amended, delegated to the Director, Federal 
Emergency Management Agency (FEMA). The rules in this subpart apply to 
major disasters and emergencies declared by the President on or after 
November 23, 1988, the date of enactment of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121 et seq.
    (b) Prior regulations. Prior regulations relating to major disasters 
and emergencies declared by the President before November 23, 1988 were 
published in 44 CFR part 205 (see 44 CFR part 205 as contained in the 
CFR edition revised as of October 1, 1994).

[59 FR 53363, Oct. 24, 1994]



Sec. 206.2  Definitions.

    (a) General. The following definitions have general applicability 
throughout this part:
    (1) The Stafford Act: The Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, Public Law 93-288, as amended.
    (2) Applicant: Individuals, families, States and local governments, 
or private nonprofit organizations who apply

[[Page 424]]

for assistance as a result of a declaration of a major disaster or 
emergency.
    (3) Associate Director: The Associate Director for State and Local 
Programs and Support, FEMA, or his/her designated representative.
    (4) Concurrent, multiple major disasters: In considering a request 
for an advance, the term concurrent multiple major disasters means major 
disasters which occur within a 12-month period immediately preceding the 
major disaster for which an advance of the non-Federal share is 
requested pursuant to section 319 of the Stafford Act.
    (5) Contractor: Any individual, partnership, corporation, agency, or 
other entity (other than an organization engaged in the business of 
insurance) performing work by contract for the Federal Government or a 
State or local agency.
    (6) Designated area: Any emergency or major disaster-affected 
portion of a State which has been determined eligible for Federal 
assistance.
    (7) Director: The Director, FEMA.
    (8) Disaster Recovery Manager (DRM): The person appointed to 
exercise the authority of a Regional Director for a particular emergency 
or major disaster.
    (9) Emergency: Any occasion or instance for which, in the 
determination of the President, Federal assistance is needed to 
supplement State and local efforts and capabilities to save lives and to 
protect property and public health and safety, or to lessen or avert the 
threat of a catastrophe in any part of the United States.
    (10) Federal agency: Any department, independent establishment, 
Government corporation, or other agency of the executive branch of the 
Federal Government, including the United States Postal Service, but 
shall not include the American National Red Cross.
    (11) Federal Coordinating Officer (FCO): The person appointed by the 
Director, or in his absence, the Deputy Director, or alternatively the 
Associate Director, to coordinate Federal assistance in an emergency or 
a major disaster.
    (12) Governor: The chief executive of any State or the Acting 
Governor.
    (13) Governor's Authorized Representative (GAR): The person 
empowered by the Governor to execute, on behalf of the State, all 
necessary documents for disaster assistance.
    (14) Hazard mitigation: Any cost effective measure which will reduce 
the potential for damage to a facility from a disaster event.
    (15) Individual assistance: Supplementary Federal assistance 
provided under the Stafford Act to individuals and families adversely 
affected by a major disaster or an emergency. Such assistance may be 
provided directly by the Federal Government or through State or local 
governments or disaster relief organizations. For further information, 
see subparts D, E, and F of these regulations.
    (16) Local government: Any county, city, village, town, district, or 
other political subdivision of any State; any Indian tribe or authorized 
tribal organization; any Alaska Native village or organization; and 
includes any rural community, unincorporated town or village, or other 
public entity for which an application for assistance is made by a State 
or political subdivision thereof.
    (17) Major disaster: Any natural catastrophe (including any 
hurricane, tornado, storm, high water, winddriven water, tidal wave, 
tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, 
or drought), or, regardless of cause, any fire, flood, or explosion, in 
any part of the United States, which in the determination of the 
President causes damage of sufficient severity and magnitude to warrant 
major disaster assistance under this Act to supplement the efforts and 
available resources of States, local governments, and disaster relief 
organizations in alleviating the damage, loss, hardship, or suffering 
caused thereby.
    (18) Mission assignment: Work order issued to a Federal agency by 
the Regional Director, Associate Director, or Director, directing 
completion by that agency of a specified task and citing funding, other 
managerial controls, and guidance.
    (19) Private nonprofit organization: Any nongovernmental agency or 
entity that currently has:

[[Page 425]]

    (i) An effective ruling letter from the U.S. Internal Revenue 
Service granting tax exemption under section 501 (c), (d), or (e) of the 
Internal Revenue Code of 1954; or
    (ii) Satisfactory evidence from the State that the organization or 
entity is a nonprofit one organized or doing business under State law.
    (20) Public assistance: Supplementary Federal assistance provided 
under the Stafford Act to State and local governments or certain 
private, nonprofit organizations other than assistance for the direct 
benefit of individuals and families. For further information, see 
subparts G and H of these regulations. Community Disaster Loans under 
section 417 of the Stafford Act and Fire Suppression Grants under 
section 420 of the Stafford Act are also included in Public Assistance. 
See subparts K and L of these regulations.
    (21) Regional Director: A director of a regional office of FEMA, or 
his/her designated representative. As used in these regulations, 
Regional Director also means the Disaster Recovery Manager who has been 
appointed to exercise the authority of the Regional Director for a 
particular emergency or major disaster.
    (22) State: Any State of the United States, the District of 
Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, the 
Trust Territory of the Pacific Islands, the Commonwealth of the Northern 
Mariana Islands, the Federated States of Micronesia, or the Republic of 
the Marshall Islands.
    (23) State Coordinating Officer (SCO): The person appointed by the 
Governor to act in cooperation with the Federal Coordinating Officer to 
administer disaster recovery efforts.
    (24) State emergency plan: As used in section 401 or section 501 of 
the Stafford Act means that State plan which is designated specifically 
for State-level response to emergencies or major disasters and which 
sets forth actions to be taken by the State and local governments, 
including those for implementing Federal disaster assistance.
    (25) Temporary housing: Temporary accommodations provided by the 
Federal Government to individuals or families whose homes are made 
unlivable by an emergency or a major disaster.
    (26) United States: The 50 States, the District of Columbia, Puerto 
Rico, the Virgin Islands, Guam, American Samoa, the Trust Territory of 
the Pacific Islands, and the Northern Mariana Islands.
    (27) Voluntary organization: Any chartered or otherwise duly 
recognized tax-exempt local, State, or national organization or group 
which has provided or may provide needed services to the States, local 
governments, or individuals in coping with an emergency or a major 
disaster.
    (b) Additional definitions. Definitions which apply to individual 
subparts are found in those subparts.



Sec. 206.3  Policy.

    It is the policy of FEMA to provide an orderly and continuing means 
of assistance by the Federal Government to State and local governments 
in carrying out their responsibilities to alleviate the suffering and 
damage that result from major disasters and emergencies by:
    (a) Providing Federal assistance programs for public and private 
losses and needs sustained in disasters;
    (b) Encouraging the development of comprehensive disaster 
preparedness and assistance plans, programs, capabilities, and 
organizations by the States and local governments;
    (c) Achieving greater coordination and responsiveness of disaster 
preparedness and relief programs;
    (d) Encouraging individuals, States, and local governments to obtain 
insurance coverage and thereby reduce their dependence on governmental 
assistance; and
    (e) Encouraging hazard mitigation measures, such as development of 
land-use and construction regulations, floodplain management, protection 
of wetlands, and environmental planning, to reduce losses from 
disasters.



Sec. 206.4  State emergency plans.

    The State shall set forth in its emergency plan all responsibilities 
and actions specified in the Stafford Act and these regulations that are 
required of the State and its political subdivisions to prepare for and 
respond to major

[[Page 426]]

disasters and emergencies and to facilitate the delivery of Federal 
disaster assistance. Although not mandatory, prior to the adoption of 
the final plan, the State is encouraged to circulate the plan to local 
governments for review and comment.

[55 FR 2288, Jan. 23, 1990, 55 FR 5458, Feb. 15, 1990]



Sec. 206.5  Assistance by other Federal agencies.

    (a) In any declared major disaster, the Associate Director or the 
Regional Director may direct any Federal agency to utilize its 
authorities and the resources granted to it under Federal law (including 
personnel, equipment, supplies, facilities, and managerial, technical, 
and advisory services) to support State and local assistance efforts.
    (b) In any declared emergency, the Associate Director or the 
Regional Director may direct any Federal agency to utilize its 
authorities and the resources granted to it under Federal law (including 
personnel, equipment, supplies, facilities, and managerial, technical, 
and advisory services) to support emergency efforts by State and local 
governments to save lives; protect property, public health and safety; 
and lessen or avert the threat of a catastrophe.
    (c) In any declared major disaster or emergency, the Associate 
Director or the Regional Director may direct any Federal agency to 
provide emergency assistance necessary to save lives and to protect 
property, public health, and safety by:
    (1) Utilizing, lending, or donating to State and local governments 
Federal equipment, supplies, facilities, personnel, and other resources, 
other than the extension of credit, for use or distribution by such 
governments in accordance with the purposes of this Act;
    (2) Distributing medicine, food, and other consumable supplies; or
    (3) Performing work or services to provide emergency assistance 
authorized in the Stafford Act.
    (d) Disaster assistance by other Federal agencies is subject to the 
coordination of the FCO. Federal agencies shall provide any reports or 
information about disaster assistance rendered under the provisions of 
these regulations or authorities independent of the Stafford Act, that 
the FCO or Regional Director considers necessary and requests from the 
agencies.
    (e) Assistance furnished by any Federal agency under paragraphs (a), 
(b), or (c) of this section is subject to the criteria provided by the 
Associate Director under these regulations.
    (f) Assistance under paragraphs (a), (b), or (c) of this section, 
when directed by the Associate Director or Regional Director, does not 
apply to nor shall it affect the authority of any Federal agency to 
provide disaster assistance independent of the Stafford Act.
    (g) In carrying out the purposes of the Stafford Act, any Federal 
agency may accept and utilize, with the consent of the State or local 
government, the services, personnel, materials, and facilities of any 
State or local government, agency, office, or employee. Such utilization 
shall not make such services, materials, or facilities Federal in nature 
nor make the State or local government or agency an arm or agent of the 
Federal Government.
    (h) Any Federal agency charged with the administration of a Federal 
assistance program may, if so requested by the applicant State or local 
authorities, modify or waive, for a major disaster, such administrative 
conditions for assistance as would otherwise prevent the giving of 
assistance under such programs if the inability to meet such conditions 
is a result of the major disaster.



Sec. 206.6  Donation or loan of Federal equipment and supplies.

    (a) In any major disaster or emergency, the Associate Director or 
the Regional Director may direct Federal agencies to donate or loan 
their equipment and supplies to State and local governments for use and 
distribution by them for the purposes of the Stafford Act.
    (b) A donation or loan may include equipment and supplies determined 
under applicable laws and regulations to be surplus to the needs and 
responsibilities of the Federal Government. The State shall certify that 
the surplus property is usable and necessary for current disaster 
purposes in order to

[[Page 427]]

receive a donation or loan. Such a donation or loan is made in 
accordance with procedures prescribed by the General Services 
Administration.



Sec. 206.7  Implementation of assistance from other Federal agencies.

    All directives, known as mission assignments, to other Federal 
agencies shall be in writing, or shall be confirmed in writing if made 
orally, and shall identify the specific task to be performed and the 
requirements or criteria to be followed. If the Federal agency is to be 
reimbursed, the letter will also contain a dollar amount which is not to 
be exceeded in accomplishing the task without prior approval of the 
issuing official.



Sec. 206.8  Reimbursement of other Federal agencies.

    (a) Assistance furnished under Sec. 206.5 (a) or (b) of this subpart 
may be provided with or without compensation as considered appropriate 
by the Associate Director or Regional Director.
    (b) The Associate Director or the Regional Director may not approve 
reimbursement of costs incurred while performing work pursuant to 
disaster assistance authorities independent of the Stafford Act.
    (c) Expenditures eligible for reimbursement. The Associate Director 
or the Regional Director may approve reimbursement of the following 
costs which are incurred in providing requested assistance.
    (1) Overtime, travel, and per diem of permanent Federal agency 
personnel.
    (2) Wages, travel, and per diem of temporary Federal agency 
personnel assigned solely to performance of services directed by the 
Associate Director or the Regional Director in the major disaster or 
emergency area designated by the Regional Director.
    (3) Travel and per diem of Federal military personnel assigned 
solely to the performance of services directed by the Associate Director 
or the Regional Director in the major disaster or emergency area 
designated by the Regional Director.
    (4) Cost of work, services, and materials procured under contract 
for the purposes of providing assistance directed by the Associate 
Director or the Regional Director.
    (5) Cost of materials, equipment, and supplies (including 
transportation, repair, and maintenance) from regular stocks used in 
providing directed assistance.
    (6) All costs incurred which are paid from trust, revolving, or 
other funds, and whose reimbursement is required by law.
    (7) Other costs submitted by an agency with written justification or 
otherwise agreed to in writing by the Associate Director or the Regional 
Director and the agency.
    (d) Procedures for reimbursement. Federal agencies performing work 
under a mission assignment will submit requests for reimbursement, as 
follows:
    (1) Federal agencies may submit requests for reimbursement of 
amounts greater than $1,000 at any time. Requests for lesser amounts may 
be submitted only quarterly. An agency shall submit a final accounting 
of expenditures after completion of the agency's work under each 
directive for assistance. The time limit and method for submission of 
reimbursement requests will be stipulated in the mission assignment 
letter.
    (2) An agency shall document its request for reimbursement with 
specific details on personnel services, travel, and all other expenses 
by object class as specified in OMB Circular A-12 and by any other 
subobject class used in the agency's accounting system. Where contracts 
constitute a significant portion of the billings, the agency shall 
provide a listing of individual contracts and their associated costs.
    (3) Reimbursement requests shall cite the specific mission 
assignment under which the work was performed, and the major disaster or 
emergency identification number. Requests for reimbursement of costs 
incurred under more than one mission assignment may not be combined for 
billing purposes.
    (4) Unless otherwise agreed, an agency shall direct all requests for 
reimbursement to the Regional Director of the region in which the costs 
were incurred.
    (5) A Federal agency requesting reimbursement shall retain all 
financial

[[Page 428]]

records, supporting documents, statistical records, and other records 
pertinent to the provision of services or use of resources by that 
agency. These materials shall be accessible to duly authorized 
representatives of FEMA and the U.S. Comptroller General, for the 
purpose of making audits, excerpts, and transcripts, for a period of 3 
years starting from the date of submission of the final billing.



Sec. 206.9  Nonliability.

    The Federal Government shall not be liable for any claim based upon 
the exercise or performance of, or the failure to exercise or perform a 
discretionary function or duty on the part of a Federal agency or an 
employee of the Federal Government in carrying out the provisions of the 
Stafford Act.



Sec. 206.10  Use of local firms and individuals.

    In the expenditure of Federal funds for debris removal, distribution 
of supplies, reconstruction, and other major disaster or emergency 
assistance activities which may be carried out by contract or agreement 
with private organizations, firms, or individuals, preference shall be 
given, to the extent feasible and practicable, to those organizations, 
firms, and individuals residing or doing business primarily in the area 
affected by such major disaster or emergency. This shall not be 
considered to restrict the use of Department of Defense resources in the 
provision of major disaster assistance under the Stafford Act.



Sec. 206.11  Nondiscrimination in disaster assistance.

    (a) Federal financial assistance to the States or their political 
subdivisions is conditioned on full compliance with 44 CFR part 7, 
Nondiscrimination in Federally-Assisted Programs.
    (b) All personnel carrying out Federal major disaster or emergency 
assistance functions, including the distribution of supplies, the 
processing of the applications, and other relief and assistance 
activities, shall perform their work in an equitable and impartial 
manner, without discrimination on the grounds of race, color, religion, 
nationality, sex, age, or economic status.
    (c) As a condition of participation in the distribution of 
assistance or supplies under the Stafford Act, or of receiving 
assistance under the Stafford Act, government bodies and other 
organizations shall provide a written assurance of their intent to 
comply with regulations relating to nondiscrimination.
    (d) The agency shall make available to employees, applicants, 
participants, beneficiaries, and other interested parties such 
information regarding the provisions of this regulation and its 
applicability to the programs or activities conducted by the agency, and 
make such information available to them in such manner as the head of 
the agency finds necessary to apprise such persons of the protections 
against discrimination assured them by the Act and this regulation.



Sec. 206.12  Use and coordination of relief organizations.

    (a) In providing relief and assistance under the Stafford Act, the 
FCO or Regional Director may utilize, with their consent, the personnel 
and facilities of the American National Red Cross, the Salvation Army, 
the Mennonite Disaster Service, and other voluntary organizations in the 
distribution of medicine, food, supplies, or other items, and in the 
restoration, rehabilitation, or reconstruction of community services and 
essential facilities, whenever the FCO or Regional Director finds that 
such utilization is necessary.
    (b) The Associate Director is authorized to enter into agreements 
with the American Red Cross, The Salvation Army, the Mennonite Disaster 
Service, and other voluntary organizations engaged in providing relief 
during and after a major disaster or emergency. Any agreement shall 
include provisions assuring that use of Federal facilities, supplies, 
and services will be in compliance with Sec. 206.11, Nondiscrimination 
in Disaster Assistance, and Sec. 206.191, Duplication of Benefits, of 
these regulations and such other regulations as the Associate Director 
may issue. The FCO may coordinate the disaster relief activities of the 
voluntary organizations which agree to operate under his/her direction.

[[Page 429]]

    (c) Nothing contained in this section shall be construed to limit or 
in any way affect the responsibilities of the American National Red 
Cross as stated in Public Law 58-4.



Sec. 206.13  Standards and reviews.

    (a) The Associate Director shall establish program standards and 
assess the efficiency and effectiveness of programs administered under 
the Stafford Act by conducting annual reviews of the activities of 
Federal agencies and State and local governments involved in major 
disaster or emergency response efforts.
    (b) In carrying out this provision, the Associate Director or 
Regional Director may direct Federal agencies to submit reports relating 
to their disaster assistance activities. The Associate Director or the 
Regional Director may request similar reports from the States relating 
to these activities on the part of State and local governments. 
Additionally, the Associate Director or Regional Director may conduct 
independent investigations, studies, and evaluations as necessary to 
complete the reviews.

[55 FR 2288, Jan. 23, 1990; 55 FR 5458, Feb. 15, 1990]



Sec. 206.14  Criminal and civil penalties.

    (a) Misuse of funds. Any person who knowingly misapplies the 
proceeds of a loan or other cash benefit obtained under this Act shall 
be fined an amount equal to one and one-half times the misapplied amount 
of the proceeds or cash benefit.
    (b) Civil enforcement. Whenever it appears that any person has 
violated or is about to violate any provision of this Act, including any 
civil penalty imposed under this Act, the Attorney General may bring a 
civil action for such relief as may be appropriate. Such action may be 
brought in an appropriate United States district court.
    (c) Referral to Attorney General. The Associate Director shall 
expeditously refer to the Attorney General for appropriate action any 
evidence developed in the performance of functions under this Act that 
may warrant consideration for criminal prosecution.
    (d) Civil penalty. Any individual who knowingly violates any order 
or regulation issued under this Act shall be subject to a civil penalty 
of not more than $5,000 for each violation.



Sec. 206.15  Recovery of assistance.

    (a) Party liable. Any person who intentionally causes a condition 
for which Federal assistance is provided under this Act or under any 
other Federal law as a result of a declaration of a major disaster or 
emergency under this Act shall be liable to the United States for the 
reasonable costs incurred by the United States in responding to such 
disaster or emergency to the extent that such costs are attributable to 
the intentional act or omission of such person which caused such 
condition. Such action shall be brought in an appropriate United States 
District Court.
    (b) Rendering of care. A person shall not be liable under this 
section for costs incurred by the United States as a result of actions 
taken or omitted by such person in the course of rendering care or 
assistance in response to a major disaster or emergency.



Sec. 206.16  Audit and investigations.

    (a) Subject to the provisions of chapter 75 of title 31, United 
States Code, and 44 CFR part 14, relating to requirements for single 
audits, the Associate Director or Regional Director shall conduct audits 
and investigations as necessary to assure compliance with the Stafford 
Act, and in connection therewith may question such persons as may be 
necessary to carry out such audits and investigations.
    (b) For purposes of audits and investigations under this section, 
FEMA or State auditors, the Governor's Authorized Representative, the 
Regional Director, the Associate Director, and the Comptroller General 
of the United States, or their duly authorized representatives, may 
inspect any books, documents, papers, and records of any person relating 
to any activity undertaken or funded under the Stafford Act.



Sec. 206.17  Effective date.

    These regulations are effective for all major disasters or 
emergencies declared on or after November 23, 1988.

[[Page 430]]



Secs. 206.18-206.30  [Reserved]



                   Subpart B--The Declaration Process

    Source: 55 FR 2292, Jan. 23, 1990, unless otherwise noted.



Sec. 206.31  Purpose.

    The purpose of this subpart is to describe the process leading to a 
Presidential declaration of a major disaster or an emergency and the 
actions triggered by such a declaration.



Sec. 206.32  Definitions.

    All definitions in the Stafford Act and in Sec. 206.2 apply. In 
addition, the following definitions apply:
    (a) Appeal: A request for reconsideration of a determination on any 
action related to Federal assistance under the Stafford Act and these 
regulations. Specific procedures for appeals are contained in the 
relevant subparts of these regulations.
    (b) Commitment: A certification by the Governor that the State and 
local governments will expend a reasonable amount of funds to alleviate 
the effects of the major disaster or emergency, for which no Federal 
reimbursement will be requested.
    (c) Disaster Application Center: A center established in a 
centralized location within the disaster area for individuals, families, 
or businesses to apply for disaster aid.
    (d) FEMA-State Agreement: A formal legal document stating the 
understandings, commitments, and binding conditions for assistance 
applicable as the result of the major disaster or emergency declared by 
the President.
    (e) Incident: Any condition which meets the definition of major 
disaster or emergency as set forth in Sec. 206.2 which causes damage or 
hardship that may result in a Presidential declaration of a major 
disaster or an emergency.
    (f) Incident period: The time interval during which the disaster-
causing incident occurs. No Federal assistance under the Act shall be 
approved unless the damage or hardship to be alleviated resulted from 
the disaster-causing incident which took place during the incident 
period or was in anticipation of that incident. The incident period will 
be established by FEMA in the FEMA-State Agreement and published in the 
Federal Register.



Sec. 206.33  Preliminary damage assessment.

    The preliminary damage assessment (PDA) process is a mechanism used 
to determine the impact and magnitude of damage and the resulting unmet 
needs of individuals, businesses, the public sector, and the community 
as a whole. Informtion collected is used by the State as a basis for the 
Governor's request, and by FEMA to document the recommendation made to 
the President in response to the Governor's request. It is in the best 
interest of all parties to combine State and Federal personnel resources 
by performing a joint PDA prior to the initiation of a Governor's 
request, as follows.
    (a) Preassessment by the State. When an incident occurs, or is 
imminent, which the State official responsible for disaster operations 
determines may be beyond the State and local government capabilities to 
respond, the State will request the Regional Director to perform a joint 
FEMA-State preliminary damage assessment. It is not anticipated that all 
occurrences will result in the requirement for assistance; therefore, 
the State will be expected to verify their initial information, in some 
manner, before requesting this support.
    (b) Damage assessment teams. Damage assessment teams will be 
composed of at least one representative of the Federal Government and 
one representative of the State. A local government representative, 
familiar with the extent and location of damage in his/her community, 
should also be included, if possible. Other State and Federal agencies, 
and voluntary relief organizations may also be asked to participate, as 
needed. It is the State's responsibility to coordinate State and local 
participation in the PDA and to ensure that the participants receive 
timely notification concerning the schedule. A FEMA official will brief 
team members

[[Page 431]]

on damage criteria, the kind of information to be collected for the 
particular incident, and reporting requirements.
    (c) Review of findings. At the close of the PDA, FEMA will consult 
with State officials to discuss findings and reconcile any differences.
    (d) Exceptions. The requirement for a joint PDA may be waived for 
those incidents of unusual severity and magnitude that do not require 
field damage assessments to determine the need for supplemental Federal 
assistance under the Act, or in such other instances determined by the 
Regional Director upon consultation with the State. It may be necessary, 
however, to conduct an assessment to determine unmet needs for 
managerial response purposes.



Sec. 206.34  Request for utilization of Department of Defense (DOD) resources.

    (a) General. During the immediate aftermath of an incident which may 
ultimately qualify for a Presidential declaration of a major disaster or 
emergency, when threats to life and property are present which cannot be 
effectively dealt with by the State or local governments, the Associate 
Director may direct DOD to utilize DOD personnel and equipment for 
removal of debris and wreckage and temporary restoration of essential 
public facilities and services.
    (b) Request process. The Governor of a State, or the Acting Governor 
in his/her absence, may request such DOD assistance. The Governor should 
submit the request to the Associate Director through the appropriate 
Regional Director to ensure prompt acknowledgment and processing. The 
request must be submitted within 48 hours of the occurrence of the 
incident. Requests made after that time may still be considered if 
information is submitted indicating why the request for assistance could 
not be made during the initial 48 hours. The request shall include:
    (1) Information describing the types and amount of DOD emergency 
assistance being requested;
    (2) Confirmation that the Governor has taken appropriate action 
under State law and directed the execution of the State emergency plan;
    (3) A finding that the situation is of such severity and magnitude 
that effective response is beyond the capabilities of the State and 
affected local governments and that Federal assistance is necessary for 
the preservation of life and property;
    (4) A certification by the Governor that the State and local 
government will reimburse FEMA for the non-Federal share of the cost of 
such work; and
    (5) An agreement:
    (i) To provide all lands, easements and rights-of-way necessary to 
accomplish the approved work without cost to the United States;
    (ii) To hold and save the United States free from damages due to the 
requested work, and to indemnify the Federal government against any 
claims arising from such work; and
    (iii) To assist DOD in all support and local jurisdictional matters.
    (c) Processing the request. Upon receipt of the request, the 
Regional Director shall gather adequate information to support a 
recommendation and forward it to the Associate Director. If the 
Associate Director determines that such work is essential to save lives 
and protect property, he/she will issue a mission assignment to DOD 
authorizing direct Federal assistance to the extent deemed appropriate.
    (d) Implementation of assistance. The performance of emergency work 
may not exceed a period of 10 days from the date of the mission 
assignment.
    (e) Limits. Generally, no work shall be approved under this section 
which falls within the statutory authority of DOD or another Federal 
agency. However, where there are significant unmet needs of sufficient 
severity and magnitude, not addressed by other assistance, which could 
appropriately be addressed under this section of the Stafford Act, the 
involvement of other Federal agencies would not preclude the 
authorization of DOD assistance by the Associate Director.
    (f) Federal share. The Federal share of assistance under this 
section shall be not less than 75 percent of the cost of eligible work.

[[Page 432]]

    (g) Project management. DOD shall ensure that the work is completed 
in accordance with the approved scope of work, costs, and time 
limitations in the mission assignment. DOD shall also keep the Regional 
Director and the State advised of work progress and other project 
developments. It is the responsibility of DOD to ensure compliance with 
applicable Federal, State and local legal requirements. A final report 
will be submitted to the Regional Director upon termination of all 
direct Federal assistance work. Final reports shall be signed by a 
representative of DOD and the State. Once the final eligible cost is 
determined, DOD will request reimbursement from FEMA and FEMA will 
submit a bill to the State for the non-Federal share of the mission 
assignment.
    (h) Reimbursement of DOD. Reimbursement will be made in accordance 
with Sec. 206.8 of these regulations.



Sec. 206.35  Requests for emergency declarations.

    (a) When an incident occurs or threatens to occur in a State, which 
would not qualify under the definition of a major disaster, the Governor 
of a State, or the Acting Governor in his/her absence, may request that 
the President declare an emergency. The Governor should submit the 
request to the President through the appropriate Regional Director to 
ensure prompt acknowledgment and processing. The request must be 
submitted within 5 days after the need for assistance under title V 
becomes apparent, but no longer than 30 days after the occurrence of the 
incident, in order to be considered. The period may be extended by the 
Associate Director provided that a written request for such extension is 
made by the Governor, or Acting Governor, during the 30-day period 
immediately following the incident. The extension request must stipulate 
the reason for the delay.
    (b) The basis for the Governor's request must be the finding that 
the situation:
    (1) Is of such severity and magnitude that effective response is 
beyond the capability of the State and the affected local government(s); 
and
    (2) Requires supplementary Federal emergency assistance to save 
lives and to protect property, public health and safety, or to lessen or 
avert the threat of a disaster.
    (c) In addition to the above findings, the complete request shall 
include:
    (1) Confirmation that the Governor has taken appropriate action 
under State law and directed the execution of the State emergency plan;
    (2) Information describing the State and local efforts and resources 
which have been or will be used to alleviate the emergency;
    (3) Information describing other Federal agency efforts and 
resources which have been or will be used in responding to this 
incident; and
    (4) Identification of the type and extent of additional Federal aid 
required.
    (d) Modified declaration for Federal emergencies. The requirement 
for a Governor's request under paragraph (a) of this section can be 
waived when an emergency exists for which the primary responsibility 
rests in the Federal government because the emergency involves a subject 
area for which, under the Constitution or laws of the United States, the 
Federal government exercises exclusive or preeminent responsibility and 
authority. Any party may bring the existence of such a situation to the 
attention of the FEMA Regional Director. Any recommendation for a 
Presidential declaration of emergency in the absence of a Governor's 
request must be initiated by the Regional Director or transmitted 
through the Regional Director by another Federal agency. In determining 
that such an emergency exists, the Associate Director or Regional 
Director shall consult the Governor of the affected State, if 
practicable.
    (e) Other authorities. It is not intended for an emergency 
declaration to preempt other Federal agency authorities and/or 
established plans and response mechanisms in place prior to the 
enactment of the Stafford Act.



Sec. 206.36  Requests for major disaster declarations.

    (a) When a catastrophe occurs in a State, the Governor of a State, 
or the Acting Governor in his/her absence,

[[Page 433]]

may request a major disaster declaration. The Governor should submit the 
request to the President through the appropriate Regional Director to 
ensure prompt acknowledgment and processing. The request must be 
submitted within 30 days of the occurrence of the incident in order to 
be considered. The 30-day period may be extended by the Associate 
Director, provided that a written request for an extension is submitted 
by the Governor, or Acting Governor, during this 30-day period. The 
extension request will stipulate reasons for the delay.
    (b) The basis for the request shall be a finding that:
    (1) The situation is of such severity and magnitude that effective 
response is beyond the capabilities of the State and affected local 
governments; and
    (2) Federal assistance under the Act is necessary to supplement the 
efforts and available resources of the State, local governments, 
disaster relief organizations, and compensation by insurance for 
disaster-related losses.
    (c) In addition to the above findings, the complete request shall 
include:
    (1) Confirmation that the Governor has taken appropriate action 
under State law and directed the execution of the State emergency plan;
    (2) An estimate of the amount and severity of damages and losses 
stating the impact of the disaster on the public and private sector;
    (3) Information describing the nature and amount of State and local 
resources which have been or will be committed to alleviate the results 
of the disaster;
    (4) Preliminary estimates of the types and amount of supplementary 
Federal disaster assistance needed under the Stafford Act; and
    (5) Certification by the Governor that State and local government 
obligations and expenditures for the current disaster will comply with 
all applicable cost sharing requirements of the Stafford Act.
    (d) For those catastrophes of unusual severity and magnitude when 
field damage assessments are not necessary to determine the requirement 
for supplemental Federal assistance, the Governor or Acting Governor may 
send an abbreviated written request through the Regional Director for a 
declaration of a major disaster. This may be transmitted in the most 
expeditious manner available. In the event the FEMA Regional Office is 
severely impacted by the catastrophe, the request may be addressed to 
the Director of FEMA. The request must indicate a finding in accordance 
with Sec. 206.36(b), and must include as a minimum the information 
requested by Sec. 206.36 (c)(1), (c)(3), and (c)(5). Upon receipt of the 
request, FEMA shall expedite the processing of reports and 
recommendations to the President. Notification to the Governor of the 
Presidential declaration shall be in accordance with 44 CFR 206.39. The 
Associate Director shall assure that documentation of the declaration is 
later assembled to comply fully with these regulations.



Sec. 206.37  Processing requests for declarations of a major disaster or emergency.

    (a) Acknowledgment. The Regional Director shall provide written 
acknowledgment of the Governor's request.
    (b) Regional summary. Based on information obtained by FEMA/State 
preliminary damage assessments of the affected area(s) and consultations 
with appropriate State and Federal officials and other interested 
parties, the Regional Director shall promptly prepare a summary of the 
PDA findings. The data will be analyzed and submitted with a 
recommendation to the Associate Director. The Regional Analysis shall 
include a discussion of State and local resources and capabilities, and 
other assistance available to meet the major disaster or emergency-
related needs.
    (c) FEMA recommendation. Based on all available information, the 
Director shall formulate a recommendation which shall be forwarded to 
the President with the Governor's request.
    (1) Major disaster recommendation. The recommendation will be based 
on a finding that the situation is or is not of such severity and 
magnitude as to be beyond the capabilities of the State and its local 
governments. It will also contain a determination of whether or not 
supplemental Federal assistance under the Stafford Act is necessary and

[[Page 434]]

appropriate. In developing a recommendation, FEMA will consider such 
factors as the amount and type of damages; the impact of damages on 
affected individuals, the State, and local governments; the available 
resources of the State and local governments, and other disaster relief 
organizations; the extent and type of insurance in effect to cover 
losses; assistance available from other Federal programs and other 
sources; imminent threats to public health and safety; recent disaster 
history in the State; hazard mitigation measures taken by the State or 
local governments, especially implementation of measures required as a 
result of previous major disaster declarations; and other factors 
pertinent to a given incident.
    (2) Emergency recommendation. The recommendation will be based on a 
report which will indicate whether or not Federal emergency assistance 
under section 502 of the Stafford Act is necessary to supplement State 
and local efforts to save lives, protect property and public health and 
safety, or to lessen or avert the threat of a catastrophe. Only after it 
has been determined that all other resources and authorities available 
to meet the crisis are inadequate, and that assistance provided in 
section 502 of the Stafford Act would be appropriate, will FEMA 
recommend an emergency declaration to the President.
    (d) Modified Federal emergency recommendation. The recommendation 
will be based on a report which will indicate that an emergency does or 
does not exist for which assistance under section 502 of the Stafford 
Act would be appropriate. An emergency declaration will not be 
recommended in situations where the authority to respond or coordinate 
is within the jurisdiction of one or more Federal agencies without a 
Presidential declaration. However, where there are significant unmet 
needs of sufficient severity and magnitude, not addressed by other 
assistance, which could appropriately be addressed under the Stafford 
Act, the involvement of other Federal agencies would not preclude a 
declaration of an emergency under the Act.



Sec. 206.38  Presidential determination.

    (a) The Governor's request for a major disaster declaration may 
result in either a Presidential declaration of a major disaster or an 
emergency, or denial of the Governor's request.
    (b) The Governor's request for an emergency declaration may result 
only in a Presidential declaration of an emergency, or denial of the 
Governor's request.

[55 FR 2292, Jan. 23, 1990; 55 FR 5458, Feb. 15, 1990]



Sec. 206.39  Notification.

    (a) The Governor will be promptly notified by the Director or his/
her designee of a declaration by the President that an emergency or a 
major disaster exists. FEMA also will notify other Federal agencies and 
other interested parties.
    (b) The Governor will be promptly notified by the Director or his/
her designee of a determination that the Governor's request does not 
justify the use of the authorities of the Stafford Act.
    (c) Following a major disaster or emergency declaration, the 
Regional Director or Associate Director will promptly notify the 
Governor of the designations of assistance and areas eligible for such 
assistance.



Sec. 206.40  Designation of affected areas and eligible assistance.

    (a) Eligible assistance. The Associate Director has been delegated 
authority to determine and designate the types of assistance to be made 
available. The initial designations will usually be announced in the 
declaration. Determinations by the Associate Director of the types and 
extent of FEMA disaster assistance to be provided are based upon 
findings whether the damage involved and its effects are of such 
severity and magnitude as to be beyond the response capabilities of the 
State, the affected local governments, and other potential recipients of 
supplementary Federal assistance. The Associate Director may authorize 
all, or only particular types of, supplementary Federal assistance 
requested by the Governor.
    (b) Areas eligible to receive assistance. The Associate Director 
also has been

[[Page 435]]

delegated authority to designate the disaster-affected areas eligible 
for supplementary Federal assistance under the Stafford Act. These 
designations shall be published in the Federal Register. A disaster-
affected area designated by the Associate Director includes all local 
government jurisdictions within its boundaries. The Associate Director 
may, based upon damage assessments in any given area, designate all or 
only some of the areas requested by the Governor for supplementary 
Federal assistance.
    (c) Requests for additional designations after a declaration. After 
a declaration by the President, the Governor, or the GAR, may request 
that additional areas or types of supplementary Federal assistance be 
authorized by the Associate Director. Such requests shall be accompanied 
by appropriate verified assessments and commitments by State and local 
governments to demonstrate that the requested designations are justified 
and that the unmet needs are beyond State and local capabilities without 
supplementary Federal assistance. Additional assistance or areas added 
to the declaration will be published in the Federal Register.
    (d) Time limits to request. In order to be considered, all 
supplemental requests under paragraph (c) of this section must be 
submitted within 30 days from the termination date of the incident, or 
30 days after the declaration, whichever is later. The 30-day period may 
be extended by the Associate Director provided that a written request is 
made by the appropriate State official during this 30-day period. The 
request must include justification of the State's inability to meet the 
deadline.



Sec. 206.41  Appointment of disaster officials.

    (a) Federal Coordinating Officer. Upon a declaration of a major 
disaster or of an emergency by the President, the Director, or in his 
absence, the Deputy Director, or alternately, the Associate Director 
shall appoint an FCO who shall initiate action immediately to assure 
that Federal assistance is provided in accordance with the declaration, 
applicable laws, regulations, and the FEMA-State Agreement.
    (b) Disaster Recovery Manager. The Regional Director shall designate 
a DRM to exercise all the authority of the Regional Director in a major 
disaster or an emergency.
    (c) State Coordinating Officer. Upon a declaration of a major 
disaster or of an emergency, the Governor of the affected State shall 
designate an SCO who shall coordinate State and local disaster 
assistance efforts with those of the Federal Government.
    (d) Governor's Authorized Representative. In the FEMA-State 
Agreement, the Governor shall designate the GAR, who shall administer 
Federal disaster assistance programs on behalf of the State and local 
governments and other grant or loan recipients. The GAR is responsible 
for the State compliance with the FEMA-State Agreement.



Sec. 206.42  Responsibilities of coordinating officers.

    (a) Following a declaration of a major disaster or an emergency, the 
FCO shall:
    (1) Make an initial appraisal of the types of assistance most 
urgently needed;
    (2) In coordination with the SCO, establish field offices and 
Disaster Application Centers as necessary to coordinate and monitor 
assistance programs, disseminate information, accept applications, and 
counsel individuals, families and businesses concerning available 
assistance;
    (3) Coordinate the administration of relief, including activities of 
State and local governments, activities of Federal agencies, and those 
of the American Red Cross, the Salvation Army, the Mennonite Disaster 
Service, and other voluntary relief organizations which agree to operate 
under the FCO's advice and direction;
    (4) Undertake appropriate action to make certain that all of the 
Federal agencies are carrying out their appropriate disaster assistance 
roles under their own legislative authorities and operational policies; 
and
    (5) Take other action, consistent with the provisions of the 
Stafford Act, as necessary to assist citizens and public officials in 
promptly obtaining assistance to which they are entitled.

[[Page 436]]

    (b) The SCO coordinates State and local disaster assistance efforts 
with those of the Federal Government working closely with the FCO. The 
SCO is the principal point of contact regarding coordination of State 
and local disaster relief activities, and implementation of the State 
emergency plan. The functions, responsibilities, and authorities of the 
SCO are set forth in the State emergency plan. It is the responsibility 
of the SCO to ensure that all affected local jurisdictions are informed 
of the declaration, the types of assistance authorized, and the areas 
eligible to receive such assistance.



Sec. 206.43  Emergency support teams.

    The Federal Coordinating Officer may activate emergency support 
teams, composed of Federal program and support personnel, to be deployed 
into an area affected by a major disaster or emergency. These emergency 
support teams assist the FCO in carrying out his/her responsibilities 
under the Stafford Act and these regulations. Any Federal agency can be 
directed to detail personnel within the agency's administrative 
jurisdiction to temporary duty with the FCO. Each detail shall be 
without loss of seniority, pay, or other employee status.



Sec. 206.44  FEMA-State Agreements.

    (a) General. Upon the declaration of a major disaster or an 
emergency, the Governor, acting for the State, and the FEMA Regional 
Director or his/her designee, acting for the Federal Government, shall 
execute a FEMA-State Agreement. The FEMA-State Agreement states the 
understandings, commitments, and conditions for assistance under which 
FEMA disaster assistance shall be provided. This Agreement imposes 
binding obligations on FEMA, States, their local governments, and 
private nonprofit organizations within the States in the form of 
conditions for assistance which are legally enforceable. No FEMA funding 
will be authorized or provided to any grantees or other recipients, nor 
will direct Federal assistance be authorized by mission assignment, 
until such time as this Agreement for the Presidential declaration has 
been signed, except where it is deemed necessary by the Regional 
Director to begin the process of providing essential emergency services 
or temporary housing.
    (b) Terms and conditions. This Agreement describes the incident and 
the incident period for which assistance will be made available, the 
type and extent of the Federal assistance to be made available, and 
contains the commitment of the State and local government(s) with 
respect to the amount of funds to be expended in alleviating damage and 
suffering caused by the major disaster or emergency. The Agreement also 
contains such other terms and conditions consistent with the declaration 
and the provisions of applicable laws, Executive Order and regulations.
    (c) Provisions for modification. In the event that the conditions 
stipulated in the original Agreement are changed or modified, such 
changes will be reflected in properly executed amendments to the 
Agreement, which may be signed by the GAR and the Regional Director or 
his/her designee for the specified major disaster or emergency. 
Amendments most often occur to close or amend the incident period, to 
add forms of assistance not originally authorized, or to designate 
additional areas eligible for assistance.
    (d) In a modified declaration for a Federal emergency, a FEMA-State 
Agreement may or may not be required based on the type of assistance 
being provided.



Sec. 206.45  Loans of non-Federal share.

    (a) Conditions for making loans. At the request of the Governor, the 
Associate Director may lend or advance to a State, either for its own 
use or for the use of public or private nonprofit applicants for 
disaster assistance under the Stafford Act, the portion of assistance 
for which the State or other eligible disaster assistance applicant is 
responsible under the cost-sharing provisions of the Stafford Act in any 
case in which:
    (1) The State or other eligible disaster assistance applicant is 
unable to assume their financial responsibility under such cost sharing 
provisions:
    (i) As a result of concurrent, multiple major disasters in a 
jurisdiction, or

[[Page 437]]

    (ii) After incurring extraordinary costs as a result of a particular 
disaster;
    (2) The damages caused by such disasters or disaster are so 
overwhelming and severe that it is not possible for the State or other 
eligible disaster assistance applicant to immediately assume their 
financial responsibility under the Act; and
    (3) The State and the other eligible disaster applicants are not 
delinquent in payment of any debts to FEMA incurred as a result of 
Presidentially declared major disasters or emergencies.
    (b) Repayment of loans. Any loan made to a State under paragraph (a) 
of this section must be repaid to the United States. The Governor must 
include a repayment schedule as part of the request for advance.
    (1) The State shall repay the loan (the principal disbursed plus 
interest) in accordance with the repayment schedule approved by the 
Associate Director.
    (2) If the State fails to make payments in accordance with the 
approved repayment schedule, FEMA will offset delinquent amounts against 
the current, prior, or any subsequent disasters, or monies due the State 
under other FEMA programs, in accordance with the established Claims 
Collection procedures.
    (c) Interest. Loans or advances under paragraph (a) of this section 
shall bear interest at a rate determined by the Secretary of the 
Treasury, taking into consideration the current market yields on 
outstanding marketable obligations of the United States with remaining 
periods to maturity comparable to the reimbursement period of the loan 
or advance. Simple interest will be computed from the date of the 
disbursement of each drawdown of the loan/advance by the State based on 
365 days/year.



Sec. 206.46  Appeals.

    (a) Denial of declaration request. When a request for a major 
disaster declaration or for any emergency declaration is denied, the 
Governor may appeal the decision. An appeal must be made within 30 days 
after the date of the letter denying the request. This one-time request 
for reconsideration, along with appropriate additional information, is 
submitted to the President through the appropriate Regional Director. 
The processing of this request is similar to the initial request.
    (b) Denial of types of assistance or areas. In those instances when 
the type of assistance or certain areas requested by the Governor are 
not designated or authorized, the Governor, or the GAR, may appeal the 
decision. An appeal must be submitted in writing within 30 days of the 
date of the letter denying the request. This one-time request for 
reconsideration, along with justification and/or additional information, 
is sent to the Associate Director through the appropriate Regional 
Director.
    (c) Denial of advance of non-Federal share. In those instances where 
the Governor's request for an advance is denied, the Governor may appeal 
the decision. An appeal must be submitted in writing within 30 days of 
the date of the letter denying the request. This one-time request for 
reconsideration, along with justification and/or additional information, 
is sent to the Associate Director through the appropriate Regional 
Director.
    (d) Extension of time to appeal. The 30-day period referred to in 
paragraphs (a), (b), or (c) of this section may be extended by the 
Associate Director provided that a written request for such an 
extension, citing reasons for the delay, is made during this 30-day 
period, and if the Associate Director agrees that there is a legitimate 
basis for extension of the 30-day period. Only the Governor may request 
a time extension for appeals covered in paragraphs (a) and (c) of this 
section. The Governor, or the GAR if one has been named, may submit the 
time extension request for appeals covered in paragraph (b) of this 
section.



Secs. 206.47-206.60  [Reserved]



                     Subpart C--Emergency Assistance

    Source: 55 FR 2296, Jan. 23, 1990, unless otherwise noted.



Sec. 206.61  Purpose.

    The purpose of this subpart is to identify the forms of assistance 
which

[[Page 438]]

may be made available under an emergency declaration.



Sec. 206.62  Available assistance.

    In any emergency declaration, the Associate Director or Regional 
Director may provide assistance, as follows:
    (a) Direct any Federal agency, with or without reimbursement, to 
utilize its authorities and the resources granted to it under Federal 
law (including personnel, equipment, supplies, facilities, and 
managerial, technical and advisory services) in support of State and 
local emergency assistance efforts to save lives, protect property and 
public health and safety, and lessen or avert the threat of a 
catastrophe;
    (b) Coordinate all disaster relief assistance (including voluntary 
assistance) provided by Federal agencies, private organizations, and 
State and local governments;
    (c) Provide technical and advisory assistance to affected State and 
local governments for:
    (1) The performance of essential community services;
    (2) Issuance of warnings of risks or hazards;
    (3) Public health and safety information, including dissemination of 
such information;
    (4) Provision of health and safety measures; and
    (5) Management, control, and reduction of immediate threats to 
public health and safety;
    (d) Provide emergency assistance under the Stafford Act through 
Federal agencies;
    (e) Remove debris in accordance with the terms and conditions of 
section 407 of the Stafford Act;
    (f) Provide temporary housing assistance in accordance with the 
terms and conditions of section 408 of the Stafford Act; and
    (g) Assist State and local governments in the distribution of 
medicine, food, and other consumable supplies, and emergency assistance.



Sec. 206.63  Provision of assistance.

    Assistance authorized by an emergency declaration is limited to 
immediate and short-term assistance, essential to save lives, to protect 
property and public health and safety, or to lessen or avert the threat 
of a catastrophe.



Sec. 206.64  Coordination of assistance.

    After an emergency declaration by the President, all Federal 
agencies, voluntary organizations, and State and local governments 
providing assistance shall operate under the coordination of the Federal 
Coordinating Officer.



Sec. 206.65  Cost sharing.

    The Federal share for assistance provided under this title shall not 
be less than 75 percent of the eligible costs.



Sec. 206.66  Limitation on expenditures.

    Total assistance provided in any given emergency declaration may not 
exceed $5,000,000, except when it is determined by the Associate 
Director that:
    (a) Continued emergency assistance is immediately required;
    (b) There is a continuing and immediate risk to lives, property, 
public health and safety; and
    (c) Necessary assistance will not otherwise be provided on a timely 
basis.



Sec. 206.67  Requirement when limitation is exceeded.

    Whenever the limitation described in Sec. 206.66 is exceeded, the 
Director must report to the Congress on the nature and extent of 
continuing emergency assistance requirements and shall propose 
additional legislation if necessary.



Secs. 206.68-206.100  [Reserved]



                 Subpart D--Temporary Housing Assistance



Sec. 206.101  Temporary housing assistance.

    (a) Purpose. This section prescribes the policy to be followed by 
the Federal Government or any other organization when implementing 
section 408 of the Stafford Act.
    (b) Program intent. Assistance under this program is made available 
to applicants who require temporary housing as a result of a major 
disaster or emergency that is declared by the President. Eligibility for 
assistance is based on need created by disaster-related unlivability of 
a primary residence

[[Page 439]]

or other disaster-related displacement, combined with a lack of adequate 
insurance coverage. Eligible applicants may be paid for authorized 
accommodations and/or repairs. In the interest of assisting the greatest 
number of people in the shortest possible time, applicants who are able 
to do so will be encouraged to make their own arrangements for temporary 
housing. Although numerous instances of minor damage may cause some 
inconvenience to the applicant, the determining eligibility factor must 
be the livability of the primary residence. FEMA has also determined 
that it is reasonable to expect applicants or their landlords to make 
some repairs of a minor nature. Temporary housing will normally consist 
of a check to cover housing-related costs wherever possible.
    (c) Definitions.
    (1) Adequate alternate housing means housing that:
    (i) Accommodates the needs of the occupants.
    (ii) Is within reasonable commuting distance of work, school, or 
agricultural activities which provide over 25% of the household income.
    (iii) Is within the financial ability of the occupant in the 
realization of a permanent housing plan.
    (2) Effective date of assistance means the date the eligible 
applicant received temporary housing assistance but, where applicable, 
only after appropriate insurance benefits are exhausted.
    (3) Essential living area means that area of the residence essential 
to normal living, i.e., kitchen, one bathroom, dining area, living room, 
entrances and exits, and essential sleeping areas. It does not include 
family rooms, guest rooms, garages, or other nonessential areas, unless 
hazards exist in these areas which impact the safety of the essential 
living area.
    (4) Fair market rent means a reasonable amount to pay in the local 
area for the size and type of accommodations which meets the applicant's 
needs.
    (5) Financial ability is the determination of the occupant's ability 
to pay housing costs. The determination is based upon the amount paid 
for housing before the disaster, provided the household income has not 
changed subsequent to or as a result of the disaster or 25 percent of 
gross post disaster income if the household income changed as a result 
of the disaster. When computing financial ability, extreme or unusual 
financial circumstances may be considered by the Regional Director.
    (6) Household means all residents of the predisaster residence who 
request temporary housing assistance, plus any additions during the 
temporary housing period, such as infants, spouses, or part-time 
residents who were not present at the time of the disaster but who are 
expected to return during the temporary housing period.
    (7) Housing costs means shelter rent and mortgage payments including 
principal, interest, real estate taxes, real property insurance, and 
utility costs, where appropriate.
    (8) Occupant means an eligible applicant residing in temporary 
housing provided under this section.
    (9) Owner-occupied means that the residence is occupied by: the 
legal owner; a person who does not hold formal title to the residence 
and pays no rent but is responsible for the payment of taxes, or 
maintenance of the residence; or a person who has lifetime occupancy 
rights with formal title vested in another.
    (10) Primary residence means the dwelling where the applicant 
normally lives during the major portion of the calendar year, a dwelling 
which is required because of proximity to employment, or to agricultural 
activities as referenced in paragraph (c)(1)(ii) of this section.
    (d) Duplication of benefits--(1) Requirement to avoid duplication. 
Temporary housing assistance shall not be provided to an applicant if 
such assistance has been provided by any other source. If any State or 
local government or voluntary agency has provided temporary housing, the 
assistance under this section begins at the expiration of such 
assistance, and may continue for a period not to exceed l8 months from 
the date of declaration, provided the criteria for continued assistance 
in paragraph (k)(3) of this section are met. If it is determined that 
temporary housing assistance will be provided under this section, 
notification shall be

[[Page 440]]

given those agencies which have the potential for duplicating such 
assistance. In the instance of insured applicants, temporary housing 
assistance shall be provided only when:
    (i) Payment of the applicable benefits has been significantly 
delayed;
    (ii) Applicable benefits have been exhausted;
    (iii) Applicable benefits are insufficient to cover the temporary 
housing need; or
    (iv) Housing is not available on the private market.
    (2) Recovery of funds. Prior to provision of assistance, the 
applicant must agree to repay to FEMA from insurance proceeds or 
recoveries from any other source an amount equivalent to the value of 
the temporary housing assistance provided. In no event shall the amount 
repaid to FEMA exceed the amount recovered by the applicant. All claims 
shall be collected in accordance with agency procedures for debt 
collection.
    (e) Applications--(1) Application period. Applications for temporary 
housing assistance shall be accepted for a 60-day period following the 
date of a declaration of a major disaster or emergency, unless 
additional time for submission of applications is authorized by the 
Regional Director in order to achieve uniformity of application periods 
in contiguous States. After the established period, applications shall 
be accepted; however, processing shall not be completed unless 
authorized by the Regional Director on a case-by-case basis.
    (2) Household composition. Members of a household shall be included 
on a single application and be provided one temporary housing residence 
unless it is determined by the Regional Director that the size of the 
household requires that more than one residence be provided.
    (f) General eligibility guidelines. Temporary housing assistance may 
be made available to those applicants who, as a result of a major 
disaster or emergency declared by the President, are qualified for such 
assistance.
    (1) Conditions of eligibility. Temporary housing assistance may be 
provided only when both of the following conditions are met:
    (i) The applicant's primary residence has been made unlivable or the 
applicant has been displaced as the result of a major disaster or 
emergency because:
    (A) The residence has been destroyed, essential utility service has 
been interrupted, or the essential living area has been damaged as a 
result of the disaster to such an extent as to constitute a serious 
health or safety hazard which did not exist prior to the disaster. The 
Regional Director shall prepare additional guidelines when necessary to 
respond to a particular disaster;
    (B) The residence has been made inaccessible as a result of the 
incident to the extent that the applicant cannot reasonably be expected 
to gain entry due to the disruption or destruction of transportation 
routes, other impediments to access, or restrictions placed on movement 
by a responsible official due to continued health and safety problems;
    (C) The owner of the applicant's residence requires the residence to 
meet their personal needs because the owner's predisaster residence was 
made unlivable as a result of the disaster;
    (D) Financial hardship resulting from the disaster has led to 
eviction or dispossession; or
    (E) Other circumstances resulting from the disaster, as determined 
by the Regional Director, prevent the applicant from occupying their 
predisaster primary residence.
    (ii) Insured applicants have made every reasonable effort to secure 
insurance benefits, and the insured has agreed to repay FEMA from 
whatever insurance proceeds are later received, pursuant to paragraph 
(d)(2) of this section.
    (2) Conditions of ineligibility. Except as provided for in section 
408(b), Temporary Housing Assistance shall not be provided:
    (i) To an applicant who is displaced from other than their primary 
residence; or
    (ii) When the residence in question is livable, i.e., only minor 
damage exists and it can reasonably be expected to be repaired by the 
applicant/owner or the landlord; or

[[Page 441]]

    (iii) When the applicant owns a secondary or vacation residence, or 
unoccupied rental property which meets their temporary housing needs; or
    (iv) To an applicant who has adequate rent-free housing 
accommodations; or
    (v) To an applicant who has adequate insurance coverage and there is 
no indication that benefits will be delayed; or
    (vi) When a late application is not approved for processing by the 
Regional Director; or
    (vii) To an applicant who evacuated the residence in response to 
official warnings solely as a precautionary measure, and who is able to 
return to the residence immediately after the incident (i.e., the 
applicant is not otherwise eligible for temporary housing assistance).
    (g) Forms of Temporary Housing Assistance. All proceeds received or 
receivable by the applicant under Sec. 206.101 shall be exempt from 
garnishment, seizure, encumbrance, levy, execution, pledge, attachment, 
release, or waiver. No rights under this provision are assignable or 
transferable.
    (1) Temporary Housing Assistance is normally provided in the form of 
a check to cover the cost of rent or essential home repairs. The 
exceptions to this are when existing rental resources are not available 
and repairs to the home will not make it livable in a reasonable period 
of time, or when the eligible applicant is unable to physically leave 
the home due to the need to tend crops or livestock.
    (i) Government-owned, private, and commercial properties. When an 
eligible applicant is unable to obtain an available temporary housing 
unit, FEMA may enter into a leasing agreement for the eligible 
applicant. Rent payments shall be in accordance with the fair market 
rent (FMR) rates established for each operation for the type and size 
residence.
    (ii) Transient accommodations. Immediately following a 
Presidentially declared major disaster or emergency, disaster victims 
are expected to stay with family or friends without FEMA assistance, or 
to make use of mass shelters to the fullest extent possible for short-
term housing. Transient accommodations may be provided when individual 
circumstances warrant such assistance for only a short period of time or 
pending provision of other temporary housing resources. Transient 
accommodations may be provided for up to 30 days unless this period is 
extended by the Regional Director. Authorized expenditures for transient 
accommodations shall be restricted to the rental cost including 
utilities except for those which are separately metered. Payment for 
food, telephone, or other similar services is not authorized under this 
section.
    (2) Mobile homes, travel trailers, and other manufactured housing 
units. Government-owned or privately owned mobile homes, travel 
trailers, and other manufactured housing units may be placed on 
commercial, private, or group sites. The placement must comply with 
applicable State and local codes and ordinances as well as FEMA'S 
regulations at 44 CFR part 9, Floodplain Management and Protection of 
Wetlands, and the regulations at 44 CFR part 10, Environmental 
Considerations.
    (i) A commercial site is a site customarily leased for a fee because 
it is fully equipped to accommodate a housing unit. In accordance with 
section 408(a)(2)(B), the Associate Director has determined that leasing 
commercial sites at Federal expense is in the public interest. When the 
Regional Director determines that upgrading of commercial sites or 
installation of utilities on such sites will provide more cost-
effective, timely, and suitable temporary housing than other types of 
resources, they may authorize such action at Federal expense.
    (ii) A private site is a site provided or obtained by the applicant 
at no cost to the Federal Government. Also in accordance with section 
408(a)(2)(B), the Associate Director has determined that the cost of 
installation or repairs of essential utilities on private sites is 
authorized at Federal expense when such actions will provide more cost-
effective, timely, and suitable temporary housing than other types of 
resources.
    (iii) A group site is a site which accommodates two or more units. 
In accordance with section 408(a)(2)(A), locations for group sites shall 
be provided

[[Page 442]]

by State or local government complete with utilities. However, the 
Associate Director may authorize development of group sites, including 
installation of essential utilities, by the Federal Government, based on 
a recommendation from the Regional Director; provided, however, that the 
Federal expense is limited to 75 percent of the cost of construction and 
development (including installation of utilities). In accordance with 
section 408(a)(4) of the Stafford Act, the State or local government 
shall pay any cost which is not paid for from the Federal share, 
including long-term site maintenance such as snow removal, street 
repairs and other services of a governmental nature.
    (3) Temporary mortgage and rental payments. Assistance in the form 
of mortgage or rental payments may be paid to or be provided on behalf 
of eligible applicants who, as a result of a major disaster or 
emergency, have received written notice of dispossession or eviction 
from their primary residence by foreclosure of any mortgage or lien, 
cancellation of any contract of sale, or termination of any lease 
entered into prior to the disaster. Written notice, for the purpose of 
this paragraph, means a communication in writing by a landlord, mortgage 
holder, or other party authorized under State law to file such notice. 
The purpose of such notice is to notify a person of impending 
termination of a lease, foreclosure of a mortgage or lien, or 
cancellation of any contract of sale, which would result in the person's 
dispossession or eviction. Applications for this type of assistance may 
be filed for up to 6 months following the date of declaration. This 
assistance may be provided for a period not to exceed 18 months or for 
the duration of the period of financial hardship, as determined by the 
Regional Director, whichever is less. The location of the residence of 
an applicant for assistance under this section shall not be a 
consideration of eligibility.
    (4) Home repairs. Repairs may be authorized to quickly repair or 
restore to a livable condition that portion of or areas affecting the 
essential living area of, or private access to, an owner-occupied 
primary residence which was damaged as a result of the disaster. 
Installation of utilities or conveniences not available in the residence 
prior to the disaster shall not be provided. However, repairs which are 
authorized shall conform to applicable local and/or State building 
codes; upgrading of existing damaged utilities may be authorized when 
required by these codes.
    (i) Options for repairs. Eligible applicants approved for repairs 
may be assisted through one or a combination of the following methods:
    (A) Cash payment. Payment shall be limited to the reasonable costs 
for the repairs and replacements in the locality, as determined by the 
Regional Director. This will be the method normally used, unless unusual 
circumstances warrant the methods listed under paragraph (g)(4), (i) (B) 
or (C) of this section.
    (B) Provision of materials and replacement items.
    (C) Government awarded repair contracts when authorized by the 
Associate Director.
    (ii) Feasibility. Repairs may be provided to those eligible 
applicants:
    (A) Who are owner-occupants of the residence to be made livable;
    (B) Whose residence can be made livable by repairs to the essential 
living area within 30 days following the feasibility determination. The 
Regional Director may extend this period for extenuating circumstances 
by determining that this type of assistance is still more cost 
effective, timely and otherwise suitable than other forms for temporary 
housing; and
    (C) Whose residence can be made livable by repairs to the essential 
living area, the cost of which do not exceed the dollar limitations 
established by the Associate Director. The Regional Director may, on a 
case-by-case basis, waive the dollar limitations when repairs are more 
cost effective and appropriate than other forms of housing assistance or 
when extenuating circumstances warrant.
    (iii) Scope of work. The type of repair or replacement authorized 
may vary depending upon the nature of the disaster. Items will be 
repaired where feasible or replaced only when necessary to insure the 
safety or health of the occupant. Replacement items shall be of

[[Page 443]]

average quality, size, and capacity taking into consideration the needs 
of the occupant. Repairs shall be disaster related and shall be limited 
to:
    (A) Repairs to the plumbing system, including repairs to or 
replacement of fixtures, providing service to the kitchen and one 
bathroom;
    (B) Repairs to the electrical system providing service to essential 
living areas, including repairs to or replacement of essential fixtures;
    (C) Repairs to the heating unit, including repairs to duct work, 
vents, and integral fuel and electrical systems. If repair or 
replacement through other forms of assistance cannot be accomplished 
before the start of the season requiring heat, home repairs may be 
authorized by the Regional Director when an inspection shows that the 
unit has been damaged beyond repair, or when the availability of 
necessary parts or components makes repair impossible;
    (D) Repairs to or replacement of essential components of the fuel 
system to provide for cooking;
    (E) Pumping and cleaning of the septic system, repairs to or 
replacement of the tank, drainfield, or repairs to sewer lines;
    (F) Flushing and/or purifying the water well, and repairs to or 
replacement of the pump, controls, tank, and pipes;
    (G) Repairs to or replacement of exterior doors, repair of windows 
and/or screens needed for health purposes;
    (H) Repairs to the roof, when the damages affect the essential 
living area;
    (I) Repairs to interior floors, when severe buckling or 
deterioration creates a serious safety hazard;
    (J) Blocking, leveling, and anchoring of a mobile home; and 
reconnecting and/or resetting mobile home sewer, water, electrical and 
fuel lines, and tanks;
    (K) Emergency repairs to private access routes, limited to those 
repairs that meet the minimum safety standards and using the most 
economical materials available. Such repairs are provided on a one-time 
basis when no alternative access facilities are immediately available 
and when the repairs are more cost effective, timely or otherwise 
suitable than other forms of temporary housing.
    (L) Repairs to the foundation piers, walls or footings when the 
damages affect the structural integrity of the essential living area;
    (M) Repairs to the stove and refrigerator, when feasible; and
    (N) Elimination of other health and safety hazards or performance of 
essential repairs which are authorized by the Regional Director as not 
available through emergency services provided by voluntary or community 
agencies, and cannot reasonably be expected to be completed on a timely 
basis by the occupant without FEMA assistance.
    (iv) Requirements of the Flood Disaster Protection Act. FEMA has 
determined that flood insurance purchase requirements need not be 
imposed as a condition of receiving assistance under paragraph (g)(4) of 
this section. Repair recipients will normally receive assistance for 
further repairs from other programs which will impose the purchase and 
maintenance requirements. Home repairs may not be provided in Zones A or 
V of a sanctioned or suspended community except for items that are not 
covered by flood insurance.
    (h) Appropriate form of temporary housing. The form of temporary 
housing provided should not exceed occupants' minimum requirements, 
taking into consideration items such as timely availability, cost 
effectiveness, permanent housing plans, special needs (handicaps, the 
location of crops and livestock, etc.) of the occupants, and the 
requirements of FEMA'S floodplain management regulations at 44 CFR part 
9. An eligible applicant shall receive one form of temporary housing, 
except for transient accommodations or when provision of an additional 
form is in the best interest of the Government. An eligible applicant is 
expected to accept the first offer of temporary housing; unwarranted 
refusal shall result in forfeiture of temporary housing assistance. 
Existing rental resources and home repairs shall be utilized to the 
fullest extent practicable prior to provision of government-owned mobile 
homes.
    (i) Utility costs and security deposits. All utility costs shall be 
the responsibility of the occupant except where

[[Page 444]]

utility services are not metered separately and are therefore a part of 
the rental charge. Utility use charges and deposits shall always be the 
occupants responsibility. When authorized by the Regional Director, the 
Federal Government may pay security deposits; however, the owner or 
occupant shall reimburse the full amount of the security deposit to the 
Federal Government before or at the time that the temporary housing 
assistance is terminated.
    (j) Furniture. An allowance for essential furniture may be provided 
to occupants when such assistance is required to occupy the primary or 
temporary housing residence. However, loss of furniture does not in and 
of itself constitute eligibility for temporary housing assistance. 
Luxury items shall not be provided.
    (k) Duration of assistance--(1) Commencement. Temporary housing 
assistance may be provided as of the date of the incident of the major 
disaster or emergency as specified in the Federal Register notice and 
may continue for 18 months from the date of declaration. An effective 
date of assistance shall be established for each applicant.
    (2) Continued assistance. Predisaster renters normally shall be 
provided no more than 1 month of assistance unless the Regional Director 
determines that continued assistance is warranted in accordance with 
paragraph (k)(3) of this section. All other occupants of temporary 
housing shall be certified eligible for continued assistance in 
increments not to exceed 3 months. Recertification of eligibility for 
continued assistance shall be in accordance with paragraph (k)(3) of 
this section, taking into consideration the occupant's permanent housing 
plan. A realistic permanent housing plan shall be established for each 
occupant requesting additional assistance no later than at the time of 
the first recertification.
    (3) Criteria for continued assistance. A temporary housing occupant 
shall make every effort to obtain and occupy permanent housing at the 
earliest possible time. A temporary housing occupant will be required to 
provide receipts documenting disaster related housing costs and shall be 
eligible for continued assistance when:
    (i) Adequate alternate housing is not available;
    (ii) The permanent housing plan has not been realized through no 
fault of the occupant; or
    (iii) In the case of FEMA-owner leases, the occupant is in 
compliance with the terms of the lease/rental agreement.
    (l) Period of assistance. Provided the occupant is eligible for 
continued assistance, assistance shall be provided for a period not to 
exceed 18 months from the declaration date.
    (m) Appeals. Occupants shall have the right to appeal a program 
determination in accordance with the following:
    (1) An applicant declared ineligible for temporary housing 
assistance, an applicant whose application has been cancelled for cause, 
an applicant whose application has been refused because of late filing, 
and an occupant who received a direct housing payment but is not 
eligible for continued assistance in accordance with paragraph (k) of 
this section, shall have the right to dispute such a determination 
within 60 calendar days following notification of such action. The 
Regional Director shall reconsider the original decision within 15 
calendar days after its receipt. The appellant shall be given a written 
notice of the disposition of the dispute. The decision of the Regional 
Director is final.
    (2) An occupant who has been notified that his/her request to 
purchase a mobile home or manufactured housing unit or that a request 
for an adjustment to the sales price has been denied shall have the 
right to dispute such a determination within 60 business days after 
receipt of such notice. The Regional Director shall reconsider the 
original decision within 15 calendar days after receipt of the appeal. 
The appellant shall receive written notice of the disposition of the 
dispute. The decision of the Regional Director is final.
    (3) Termination of assistance provided through a FEMA lease 
agreement shall be initiated with a 15-day written notice after which 
the occupant shall be liable for such additional charges as

[[Page 445]]

are deemed appropriate by the Regional Director including, but not 
limited to, the fair market rental for the temporary housing residence.
    (i) Grounds for termination. Temporary housing assistance may be 
terminated for reasons including, but not limited to the following:
    (A) Adequate alternate housing is available to the occupant(s);
    (B) The temporary housing assistance was obtained either through 
misrepresentation or fraud; or
    (C) Failure to comply with any term of the lease/rental agreement.
    (ii) Termination procedures. These procedures shall be utilized in 
all instances except when a State is administering the Temporary Housing 
Assistance program. States shall be subject to their own procedures 
provided they afford the occupant(s) with due process safeguards 
described in paragraph (m)(2)(v)(B) of this section.
    (A) Notification to occupant. Written notice shall be given by FEMA 
to the occupant(s) at least 15 days prior to the proposed termination of 
assistance. This notice shall specify: the reasons for termination of 
assistance/occupancy; the date of termination, which shall be not less 
than 15 days after receipt of the notice; the administrative procedure 
available to the occupant if they wish to dispute the action; and the 
occupant's liability after the termination date for additional charges.
    (B) Filing of appeal. If the occupant desires to dispute the 
termination, upon receipt of the written notice specified in paragraph 
(m)(2)(i) of this section, he/she shall present an appeal in writing to 
the appropriate office in person or by mail within 60 days from the date 
of the termination notice. The appeal must be signed by the occupant and 
state the reasons why the assistance or occupancy should not be 
terminated. If a hearing is desired, the appeal should so state.
    (C) Response to appeal. If a hearing pursuant to paragraph 
(m)(2)(ii) of this section has not been requested, the occupant has 
waived the right to a hearing. The appropriate program official shall 
deliver or mail a written response to the occupant within 5 business 
days after the receipt of the appeal.
    (D) Request for hearing. If the occupant requests a hearing pursuant 
to paragraph (m)(2)(ii) of this section, FEMA shall schedule a hearing 
date within 10 business days from the receipt of the appeal, at a time 
and place reasonably convenient to the occupant, who shall be notified 
promptly thereof in writing. The notice of hearing shall specify the 
procedure governing the hearing.
    (E) Hearing--(1) Hearing officer. The hearing shall be conducted by 
a Hearing Officer, who shall be designated by the Regional Director, and 
who shall not have been involved with the decision to terminate the 
occupant's temporary housing assistance, nor be a subordinate of any 
individual who was so involved.
    (2) Due process. The occupant shall be afforded a fair hearing and 
provided the basic safeguards of due process, including cross-
examination of the responsible official(s), access to the documents on 
which FEMA is relying, the right to counsel, the right to present 
evidence, and the right to a written decision.
    (3) Failure to appear. If an occupant fails to appear at a hearing, 
the Hearing Officer may make a determination that the occupant has 
waived the right to a hearing, or may, for good cause shown, postpone 
the hearing for no more than 5 business days.
    (4) Proof. At the hearing, the occupant must first attempt to 
establish that continued assistance is appropriate; thereafter, FEMA 
must sustain the burden of proof in justifying that termination of 
assistance is appropriate. The occupant shall have the right to present 
evidence and arguments in support of their complaint, to controvert 
evidence relied on by FEMA, and to cross examine all witnesses on whose 
testimony or information FEMA relies. The hearing shall be conducted by 
the Hearing Officer, and any evidence pertinent to the facts and issues 
raised may be received without regard to its admissibility under rules 
of evidence employed in formal judicial proceedings.
    (F) Decision. The decision of the Hearing Officer shall be based 
solely upon applicable Federal and State law,

[[Page 446]]

and FEMA regulations and requirements promulgated thereunder. The 
Hearing Officer shall prepare a written decision setting forth a 
statement of findings and conclusions together with the reasons 
therefor, concerning all material issues raised by the complainant 
within 5 business days after the hearing. The decision of the Hearing 
Officer shall be binding on FEMA, which shall take all actions necessary 
to carry out the decision or refrain from any actions prohibited by the 
decision.
    (1) The decision shall include a notice to the occupant that he/she 
must vacate the premises within 3 days of receipt of the written notice 
or on the termination date stated in the original notice of termination, 
as required in paragraph (m)(2)(i) of this section, whichever is later. 
If the occupant does not quit the premises, appropriate action shall be 
taken and, if suit is brought, the occupant may be required to pay court 
costs and attorney fees.
    (2) If the occupant is required to give a specific number of days' 
notice which exceeds the number of days in the termination notice, the 
Regional Director may approve the payment of rent for this period of 
time if requested by the occupant.
    (n) Disposition of temporary housing units--(1) Acquisition. The 
Associate Director may purchase mobile homes or other manufactured 
housing units for those who require temporary housing. After such 
temporary housing is vacated, it shall be returned to one of the FEMA-
operated Strategic Storage Centers for refurbishment and storage until 
needed in a subsequent major disaster or emergency. When returning the 
unit to a Strategic Storage Center is not feasible or cost effective, 
the Associate Director may prescribe a different method of disposition 
in accordance with applicable Federal statutes and regulations.
    (2) Sales--(i) Eligibility. When adequate alternate housing is not 
available, the Regional Director shall make available for sale directly 
to a temporary housing occupant(s) any mobile home or manufactured 
housing unit acquired by purchase, in accordance with the following:
    (A) The unit is to be used as a primary residence;
    (B) The purchaser has a site that complies with local codes and 
ordinances as well as FEMA's floodplain management regulations at 44 CFR 
part 9 (in particular Sec. 9.13(e)); and
    (C) The purchaser has sufficient funds to purchase and, if 
necessary, relocate the unit. The Associate Director may approve the 
sale of a mobile home or manufactured housing unit to a temporary 
housing occupant when adequate alternate housing is available but only 
when such sales are clearly in the best interest of the Government.
    (ii) Sales price. Units shall be sold at prices that are fair and 
equitable to the purchaser and to the Government, as determined by the 
Associate Director. The purchaser shall pay the total sales price at the 
time of sale.
    (iii) Adjustment to the sales price.
    (A) Adjustments to the sales price may be provided only when both of 
the following conditions are met:
    (1) There is a need to purchase the unit for use as the purchaser's 
primary residence because other adequate alternate housing is 
unavailable. Adequate alternate housing must meet the criteria in 
paragraph (c)(1) of this section, and may consist of:
    (i) Existing housing;
    (ii) Additional resources such as disaster-damaged rental 
accommodations which can reasonably be expected to be repaired and 
become available in the near future;
    (iii) New housing construction or housing to be made available 
through Government subsidy which is included in the immediate recovery 
plans for the area; and
    (iv) Residences which can be repaired by the predisaster owner/
occupant through funds available from insurance, other disaster 
assistance programs, or through their own resources.
    (2) In addition to his/her resources, the purchaser cannot obtain 
sufficient funds through insurance proceeds, disaster loans, grants, and 
commercial lending institutions to cover the sales price.
    (B) To determine the adjusted sales price, the current available 
financial resources of the purchaser shall be calculated. If the 
financial resources are

[[Page 447]]

equal to or greater than the basic sales price, then no adjustment shall 
be approved. If the purchaser's financial resources are less than the 
basic sales price, the sales price shall be adjusted to take into 
consideration the financial resources available but shall include some 
consideration. Deviations from this rule may be reviewed on a case-by-
case basis by the Associate Director.
    (C) The Regional Director must approve all adjustments to the sales 
price of a mobile home.
    (iv) Other conditions of sale.
    (A) A unit shall be sold ``as is, where is'' except for repairs 
necessary to protect health or safety, which are to be completed prior 
to sale. There shall be no implied warranties. In addition, the 
purchaser must be informed that he/she may have to bring the unit up to 
codes and standards which are applicable at the proposed site.
    (B) In accordance with the Flood Disaster Protection Act of 1973, 
Public Law 93-234, as amended, the sale of a unit for the purpose of 
meeting the permanent housing need of an individual or family may not be 
approved where the unit would be placed in a designated special flood 
hazard area which has been identified by the Director for at least 1 
year as floodprone unless the community in which the unit is to be 
located after the sale is, at the time of approval, participating in the 
National Flood Insurance Program. The purchaser must agree to buy and 
maintain an adequate flood insurance policy for as long as the unit is 
occupied by the purchaser. An adequate policy for purposes of this 
paragraph shall mean one which provides coverage for the basic sales 
price of the unit. The purchaser must provide proof of purchase of the 
initial flood insurance policy.
    (3) Transfer. The Associate Director may lend temporary housing 
units purchased under section 408(a) of the Act directly to States, 
other Governmental entities, or voluntary organizations. Such transfers 
may be made only in connection with a Presidential declaration of a 
major disaster or emergency. Donations may be made only when it is in 
the best interest of the Government, such as when future re-use by the 
Federal Government would not be economically feasible. As a condition of 
such transfers, the Associate Director shall require that the recipient:
    (i) Utilize the units for the purpose of providing temporary housing 
for victims of major disasters or emergencies in accordance with the 
written agreement; and
    (ii) Comply with the current applicable FEMA policies and 
regulations, including this section; 44 CFR part 9 (especially 
Secs. 9.13 and 9.14), Floodplain Management and Protection of Wetlands; 
44 CFR part 10, Environmental Considerations. The Associate Director may 
order returned any temporary housing unit made available under this 
section which is not used in accordance with the terms of transfer.
    (o) Reports. The Associate Director, Regional Director, or Federal 
Coordinating Officer may require from field operations such reports, 
plans, and evaluations as they deem necessary to carry out their 
responsibilities under the Act and these regulations.
    (p) Federal responsibility. The Federal financial and operational 
responsibility for the Temporary Housing Assistance program shall not 
exceed 18 months from the date of the declaration of the major disaster 
or emergency. This period may be extended in writing by the Associate 
Director, based on a determination that an extension is necessary and in 
the public interest. The Regional Director may authorize continued use 
on a non-reimbursable basis of Government property, office space, and 
equipment by a State, other Government entity, or voluntary organization 
after the 18 month period.
    (q) Applicant notification--(1) General. All applicants for 
temporary housing assistance will be notified regarding the type and 
amount of assistance for which they are qualified. Whenever practicable, 
such notification will be provided within 7 days of their application 
and will be in writing.
    (2) Eligible applicants for temporary housing assistance will be 
provided information regarding:
    (i) All forms of housing assistance available;
    (ii) The criteria which must be met to qualify for each type of 
assistance;
    (iii) Any limitations which apply to each type of assistance; and

[[Page 448]]

    (iv) The address and telephone number of offices responsible for 
responding to appeals and requests for changes in the type or amount of 
assistance provided.
    (r) Location. In providing temporary housing assistance, 
consideration will be given to the location of:
    (1) The eligible applicants' home and place of business;
    (2) Schools which the eligible applicant or members of the household 
attend; and
    (3) Agricultural activities which provide 25 percent or more of the 
eligible applicants' annual income.
    (s) Nonfederal administration of temporary housing assistance. A 
State may request authority to administer all or part of the temporary 
housing assistance program in the Governor's request for a declaration 
or in a subsequent written request to the Regional Director from the 
Governor or his/her authorized representative. The Associate Director 
shall approve such a request based on the Regional Director's 
recommendation and based on a finding that State administration is both 
in the interest of the Federal Government and those needing temporary 
housing assistance. The State must have an approved plan prior to the 
incident and an approved operational annex within 3 days of the 
declaration in order to administer the program. When administering the 
program the State must comply with FEMA program regulations and 
policies.
    (1) State temporary housing assistance plan. (i) States which have 
an interest in administering the Temporary Housing Assistance program 
shall be required to develop a plan that includes, at a minimum, the 
items listed below:
    (A) Assignment of temporary housing assistance responsibilities to 
State and/or local officials and agencies;
    (B) A description of the program, its functions, goals and 
objectives of the program, and proposed organization and staffing plan;
    (C) Procedures for:
    (1) Accepting applications at Disaster Application Centers and 
subsequently at a State established disaster housing office;
    (2) Determining eligibility utilizing FEMA's habitability contract 
and notifying applicants of the determination;
    (3) Preventing duplication of benefits between temporary housing 
assistance and assistance from other means, as well as a recoupment 
procedure when duplication occurs;
    (4) Providing the various types of assistance (home repairs, 
existing rental resources, transient accommodations, and mobile homes);
    (5) Providing furniture assistance;
    (6) Recertifying occupants for continued assistance;
    (7) Terminating assistance;
    (8) Contracting for services and/or supplies;
    (9) Quality control;
    (10) Maintaining a management information system;
    (11) Financial management;
    (12) Public information;
    (13) Processing appeals; and
    (14) Arranging for a program review.
    (ii) The Governor or his/her designee may request the Regional 
Director to provide technical assistance in the preparation of an 
administrative plan.
    (iii) The Governor or designee shall submit the plan to the Regional 
Director for approval. Plans shall be revised, as necessary, and shall 
be reviewed at least annually by the Regional Director.
    (2) Operational annex. Prior to the State administering the program, 
the state must submit an operational annex which tailors the approved 
State plan to the particular disaster or emergency. The annex must be 
reviewed and approved by the Regional Director within 3 days of the 
declaration or the State shall not be permitted to administer the 
program. The operational annex shall include but not be limited to:
    (i) Organization and staffing specific to the major disaster or 
emergency;
    (ii) Pertinent goals and management objectives;
    (iii) A proposed budget; and
    (iv) A narrative which describes methods for orderly tracking and 
processing of applications; assuring timely delivery of assistance; 
identification of potential problem areas; and any deviations from the 
approved plan. The Regional Director may require additional

[[Page 449]]

annexes as necessary for subsequent phases of the operation.
    (3) Evaluation of capability. State and local government assumption 
of the temporary housing assistance program for a particular disaster 
shall be approved by the Associate Director based on an evaluation of 
the capabilities and commitment of the entity by the Regional Director. 
At a minimum, the evaluation shall include a review of the following:
    (i) The State temporary housing assistance plan which has been 
approved by the Regional Director prior to the incident, and the 
specific operational annex which has been approved in accordance with 
paragraph (s)(2) of this section.
    (ii) Past performance in administration of temporary housing 
assistance or other similar operations;
    (iii) Management and staff capabilities; and
    (iv) Demonstrated understanding of the tasks to be performed.
    (4) Grant application. Approval of funding shall be obtained through 
submission of a project application by the State or local government 
through the Governor's Authorized Representative. The State shall 
maintain adequate documentation according to the requirements of 44 CFR 
part 13, Uniform Administrative Requirements for Grants and Cooperative 
Agreements to State and Local Governments, to enable analysis of the 
program. Final reimbursement to the State, or final debt collection, 
shall be based on an examination of the voucher filed by the State.
    (5) Authorized costs. All expenditures associated with administering 
the program are authorized if in compliance with 44 CFR 13.22, Allowable 
Costs, and the associated OMB Circular A-87, Cost Principles for State 
and Local Governments. Examples of program costs allowable under the 
Temporary Housing Assistance program include home repairs, costs 
associated with rental payments, reimbursements for temporary housing 
including transient accommodations and commercial site rental, mobile 
home installation and maintenance, mobile home private site development, 
cost of supplemental assistance, mortgage and rental payments, other 
necessary costs, when approved by the Associate Director. All contracts 
require the review and approval of the Regional Director prior to award, 
in order to be considered as an authorized expenditure.
    (6) Federal monitoring and oversight. The Regional Director shall 
monitor State-administered activities since he/she remains responsible 
for the overall delivery of temporary housing assistance. In addition, 
policy guidance and interpretations to meet specific needs of a disaster 
shall be provided through the oversight function.
    (7) Technical assistance. The Regional Director shall provide 
technical assistance as necessary to support State-administered 
operations through training, procedural issuances, and by providing 
experienced personnel to assist the State and local staff.
    (8) Operational resources. The Regional Director shall make 
available for use in State or locally administered temporary housing 
programs Federal stand-by contracts, memoranda of understanding with 
Government and voluntary agencies, and Federal property, such as 
government-owned mobile homes and travel trailers.
    (9) Program reviews and audits. The State shall conduct program 
review of each operation. All operations are subject to Federal audit.

(Approved by the Office of Management and Budget under OMB Control 
Numbers 3067-0009 and 3067-0043)


[55 FR 2296, Jan. 23, 1990, as amended at 61 FR 7224, Feb. 27, 1996]



Secs. 206.102-206.130  [Reserved]



             Subpart E--Individual and Family Grant Programs



Sec. 206.131  Individual and family grant programs.

    (a) General. The Governor may request that a Federal grant be made 
to a State for the purpose of such State making grants to individuals or 
families who, as a result of a major disaster, are unable to meet 
disaster-related necessary expenses or serious needs. The total Federal 
grant under this section will be equal to 75 percent of the

[[Page 450]]

actual cost of meeting necessary expenses or serious needs of 
individuals and families, plus State administrative expenses not to 
exceed 5 percent of the Federal grant (see paragraph (g) of this 
section). The total Federal grant is made only on condition that the 
remaining 25 percent of the actual cost of meeting individuals' or 
families' necessary expenses or serious needs is paid from funds made 
available by the State. With respect to any one major disaster, an 
individual or family may not receive a grant or grants under this 
section totaling more than $10,000 including both the Federal and State 
shares. The $10,000 limit will be adjusted annually, at the beginning of 
each fiscal year, to reflect changes in the Consumer Price Index for all 
Urban Consumers. IFG assistance for damages or losses to real or 
personal property, or both, will be provided to individuals or families 
with those IFG-eligible losses totaling $201 or more; those individuals 
with damages or losses of $200 or less to real or personal property, or 
both, are ineligible. The Governor or his/her designee is responsible 
for the administration of the grant program. The provisions of this 
regulation are in accordance with 44 CFR Part 13, Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments.
    (b) Purpose. The grant program is intended to provide funds to 
individuals or families to permit them to meet those disaster-related 
necessary expenses or serious needs for which assistance from other 
means is either unavailable or inadequate. Meeting those expenses and 
needs as expeditiously as possible will require States to make an early 
commitment of personnel and resources. States may make grants in 
instances where the applicant has not received other benefits to which 
he/she may be entitled by the time of application to the IFG program, 
and if the applicant agrees to repay all duplicated assistance to the 
State. The grant program is not intended to indemnify disaster losses or 
to permit purchase of items or services which may generally be 
characterized as nonessential, luxury, or decorative. Assistance under 
this program is not to be counted as income or a resource in the 
determination of eligibility for welfare or other income-tested programs 
supported by the Federal Government, in that IFG assistance is intended 
to address only disaster-related needs.
    (c) Definitions used in this section. (1) Necessary expense means 
the cost of a serious need.
    (2) Serious need means the requirement for an item or service 
essential to an individual or family to prevent, mitigate, or overcome a 
disaster-related hardship, injury, or adverse condition.
    (3) Family means a social unit living together and composed of:
    (i) Legally married individuals or those couples living together as 
if they were married and their dependents; or
    (ii) A single person and his/her dependents; or
    (iii) Persons who jointly own the residence and their dependents.
    (4) Individual means anyone who is not a member of a family as 
described above.
    (5) Dependent means someone who is normally claimed as such on the 
Federal tax return of another, according to the Internal Revenue Code. 
It may also mean the minor children of a couple not living together 
where the children live in the affected residence with the parent who 
does not actually claim them on the tax return.
    (6) Expendable items means consumables, as follows: linens, clothes, 
and basic kitchenware (pots, pans, utensils, dinnerware, flatware, small 
kitchen appliances).
    (7) Assistance from other means means assistance including monetary 
or in-kind contributions, from other governmental programs, insurance, 
voluntary or charitable organizations, or from any sources other than 
those of the individual or family. It does not include expendable items.
    (8) Owner-occupied means that the residence is occupied by: The 
legal owner; a person who does not hold formal title to the residence 
but is responsible for payment of taxes, maintenance of the residence, 
and pays no rent; or a person who has lifetime occupancy rights in the 
residence with formal title vested in another. In States where 
documentation proving ownership is not recorded or does not exist,

[[Page 451]]

the State is required to include in its administrative plan a State 
Attorney General approved set of conditions describing adequate proof of 
ownership.
    (9) Flowage easement means an area where the landowner has given the 
right to overflow, flood, or submerge the land to the government or 
other entity for a public purpose.
    (d) National eligibility criteria. In administering the IFG program, 
a State shall determine the eligibility of an individual or family in 
accordance with the following criteria;
    (1) General. (i) To qualify for a grant under this section, an 
individual or family representative must:
    (A) Make application to all applicable available governmental 
disaster assistance programs for assistance to meet a necessary expense 
or serious need, and be determined not qualified for such assistance, or 
demonstrate that the assistance received does not satisfy the total 
necessary expense or serious need;
    (B) Not have previously received or refused assistance from other 
means for the specific necessary expense or serious need, or portion 
thereof, for which application is made; and
    (C) Certify to refund to the State that part of the grant for which 
assistance from other means is received, or which is not spent as 
identified in the grant award document.
    (ii) Individuals and families who incur a necessary expense or 
serious need in the major disaster area may be eligible for assistance 
under this section without regard to their alienage, their residency in 
the major disaster area, or their residency within the State in which 
the major disaster has been declared except that for assistance in the 
``housing'' category, ownership and residency in the declared disaster 
area are required (see paragraph (d)(2)(i) of this section).
    (iii) The Flood Disaster Protection Act of 1973, Public Law 93-234, 
as amended, imposes certain restriction on approval of Federal financial 
assistance for acquisition and construction purposes. This paragraph 
states those requirements for the IFG program.
    (A) For the purpose of this paragraph, financial assistance for 
acquisition or construction purposes means a grant to an individual or 
family to repair, replace, or rebuild the insurable portions of a home, 
and/or to purchase or repair insurable contents. For a discussion of 
what elements of a home and contents are insurable, see 44 CFR part 61, 
Insurance Coverage and Rates.
    (B) A State may not make a grant for acquisition or construction 
purposes where the structure to which the grant assistance relates is 
located in a designated special flood hazard area which has been 
identified by the Director for at least 1 year as floodprone, unless the 
community in which the structure is located is participating in the 
National Flood Insurance Program (NFIP). However, if a community 
qualifies for and enters the NFIP during the 6-month period following 
the major disaster declaration, the Governor's Authorized Representative 
(GAR) may request a time extension (see paragraph (j)(1)(ii) of this 
section) from the Regional Director for the purpose of accepting and 
processing grant applications in that community. The Regional Director 
or Associate Director, as appropriate, may approve the State's request 
if those applicable governmental disaster assistance programs which were 
available during the original application period are available to the 
grant applicants during the extended application period.
    (C)(1) The State may not make a grant for acquisition or 
construction purposes in a designated special flood hazard area in which 
the sale of flood insurance is available under the NFIP unless the 
individual or family obtains adequate flood insurance and maintains such 
insurance for as long as they live at that property address. The 
coverage shall equal the maximum grant amount established under 
Sec. 411(f) of the Stafford Act. If the grantee is a homeowner, flood 
insurance coverage must be maintained on the residence at the flood-
damaged property address for as long as the structure exists if the 
grantee, or any subsequent owner of that real estate, ever wishes to be 
assisted by the Federal government with any subsequent flood damages or 
losses to real or personal property, or both. If the grantee is a 
renter, flood insurance coverage must be maintained on the

[[Page 452]]

contents for as long as the renter resides at the flood-damaged property 
address. The restriction is lifted once the renter moves from the rental 
unit.
    (2) Individuals named by a State as eligible recipients under 
Sec. 411 of the Stafford Act for an IFG program award for flood damage 
as a result of a Presidential major disaster declaration will be 
included in a Group Flood Insurance Policy (GFIP) established under the 
National Flood Insurance Program (NFIP) regulations, at 44 CFR 61.17.
    (i) The premium for the GFIP is a necessary expense within the 
meaning of this section. The State shall withhold this portion of the 
IFG award and provide it to the NFIP on behalf of individuals and 
families who are eligible for coverage. The coverage shall be equivalent 
to the maximum grant amount established under Sec. 411(f) of the 
Stafford Act.
    (ii) The State IFG program staff shall provide the NFIP with records 
of individuals who received an IFG award and are, therefore, to be 
insured. Records of IFG grantees to be insured shall be accompanied by 
payments to cover the premium amounts for each grantee for the 3-year 
policy term. The NFIP will then issue a Certificate of Flood Insurance 
to each grantee. Flood insurance coverage becomes effective on the 30th 
day following the receipt of records of GFIP insureds and their premium 
payments from the State, and terminates 36 months from the inception 
date of the GFIP, i.e., 60 days from the date of the disaster 
declaration.
    (iii) Insured grantees would not be covered if they are determined 
to be ineligible for coverage based on a number of exclusions 
established by the NFIP. Therefore, once grantees/policyholders receive 
the Certificate of Flood Insurance that contains a list of the policy 
exclusions, they should review that list to see if they are ineligible 
for coverage. Those grantees who fail to do this may find that their 
property is, in fact, not covered by the insurance policy when the next 
flooding incident occurs and they file for losses. Once the grantees 
find that their damaged buildings, contents, or both, are ineligible for 
coverage, they should notify the NFIP in writing in order to have their 
names removed from the GFIP, and to have the flood insurance maintenance 
requirement expunged from the NFIP data-tracking system. (If the grantee 
wishes to refer to or review a Standard Flood Insurance Policy, it will 
be made available by the NFIP upon request.)
    (D) A State may not make a grant to any individual or family who 
received Federal disaster assistance for flood damage occurring after 
September 23, 1994, if that property has already received federal flood-
disaster assistance in a disaster declared after September 23, 1994, a 
flood insurance purchase and maintenance requirement was levied as a 
condition or result of receiving that Federal disaster assistance, and 
flood insurance was, in fact, not maintained in an amount at least equal 
to the maximum IFG grant amount. However, if that property was 
determined to be ineligible for NFIP flood insurance coverage and is in 
a special flood hazard area located in a community participating in the 
NFIP, then the State may continue to make grants to those individuals or 
families that receive additional damage in all subsequent Presidentially 
declared major disasters involving floods.
    (iv) In order to comply with the President's Executive Orders on 
Floodplain Management (E.O. 11988) and Protection of Wetlands (E.O. 
11990), the State must implement the IFG program in accordance with FEMA 
regulations 44 CFR part 9. That part specifies which IFG program actions 
require a floodplain management decisionmaking process before a grant 
may be made, and also specifies the steps to follow in the 
decisionmaking process. Should the State determine that an individual or 
family is otherwise eligible for grant assistance, the State shall 
accomplish the necessary steps in accordance with that section, and 
request the Regional Director to make a final floodplain management 
determination.
    (2) Eligible categories. Assistance under this section shall be made 
available to meet necessary expenses or serious needs by providing 
essential items or services in the following categories:
    (i) Housing. With respect to primary residences (including mobile 
homes) which are owner-occupied at the time

[[Page 453]]

of the disaster, grants may be authorized to:
    (A) Repair, replace, or rebuild;
    (B) Provide access. When an access serves more than one individual 
or family, an owner-occupant whose primary residence is served by the 
access may be eligible for a proportionate share of the cost of jointly 
repairing or providing such access. The owner-occupant may combine his/
her grant funds with funds made available by the other individuals or 
families if a joint use agreement is executed (with no cost or charge 
involved) or if joint ownership of the access is agreed to;
    (C) Clean or make sanitary;
    (D) Remove debris from such residences. Debris removal is limited to 
the minimum required to remove health or safety hazards from, or protect 
against additional damage to the residence;
    (E) Provide or take minimum protective measures required to protect 
such residences against the immediate threat of damage, which means that 
the disaster damage is causing a potential safety hazard and, if not 
repaired, will cause actual safety hazards from common weather or 
environmental events (example: additional rain, flooding, erosion, 
wind); and
    (F) Minimization measures required by owner-occupants to comply with 
the provision of 44 CFR part 9 (Floodplain Management and Protection of 
Wetlands), to enable them to receive assistance from other means, and/or 
to enable them to comply with a community's floodplain management 
regulations.
    (ii) Personal property. Proof of ownership of personal property is 
not required. This category includes:
    (A) Clothing;
    (B) Household items, furnishings, or appliances. If a predisaster 
renter receives a grant for household items, furnishings, or appliances 
and these items are an integral part of mobile home or other furnished 
unit, the predisaster renter may apply the funds awarded for these 
specific items toward the purchase of the furnished unit, and toward 
mobile home site development, towing, set-up, connecting and/or 
reconnecting;
    (C) Tools, specialized or protective clothing, and equipment which 
are required by an employer as a condition of employment;
    (D) Repairing, cleaning or sanitizing any eligible personal property 
item; and
    (E) Moving and storing to prevent or reduce damage.
    (iii) Transportation. Grants may be authorized to repair, replace, 
or provide privately owned vehicles or to provide public transportation.
    (iv) Medical or dental expenses.
    (v) Funeral expenses. Grants may include funeral and burial (and/or 
cremation) and related expenses.
    (vi) Cost of the first year's flood insurance premium to meet the 
requirement of this section.
    (vii) Costs for estimates required for eligibility determinations 
under the IFG program. Housing and personal property estimates will be 
provided by the government. However, an applicant may appeal to the 
State if he/she feels the government estimate is inaccurate. The cost of 
an applicant-obtained estimate to support the appeal is not an eligible 
cost.
    (viii) Other. A State may determine that other necessary expenses 
and serious needs are eligible for grant assistance. If such a 
determination is made, the State must summarize the facts of the case 
and thoroughly document its findings of eligibility. Should the State 
require technical assistance in making a determination of eligibility, 
it may provide a factual summary to the Regional Director and request 
guidance. The Associate Director also may determine that other necessary 
expenses and serious needs are eligible for grant assistance. Following 
such a determination, the Associate Director shall advise the State, 
through the Regional Director, and provide the necessary program 
guidance.
    (3) Ineligible categories. Assistance under this section shall not 
be made available for any item or service in the following categories:
    (i) Business losses, including farm businesses and self-employment;
    (ii) Improvements or additions to real or personal property, except 
those required to comply with paragraph (d)(2)(i)(F) of this section;
    (iii) Landscaping;

[[Page 454]]

    (iv) Real or personal property used exclusively for recreation; and
    (v) Financial obligations incurred prior to the disaster.
    (4) Verification. The State will be provided most verification data 
on IFG applicants who were not required to first apply to the SBA. The 
FEMA Regional Director shall be responsible for performing most of the 
required verifications in the categories of housing (to include 
documentation of home ownership and primary residency); personal 
property; and transportation (to include notation of the plate or title 
number of the vehicle; the State may wish to follow up on this). Certain 
verifications may still be required to be performed by the State, such 
as on late applicants or reverifications, when FEMA or its contractors 
are no longer available, and on medical/dental, funeral and ``other'' 
categories. Eligibility determination functions shall be performed by 
the State. The SBA will provide copies of verification performed by SBA 
staff on housing and personal property (including vehicles) for those 
applicants who were first required to apply to SBA. This will enable the 
State to make an eligibility determination on those applicants. When an 
applicant disagrees with the grant award, he/she may appeal to the 
State. The cost of any estimate provided by the applicant in support of 
his/her appeal is not eligible under the program.
    (e) State administrative plan. (1) The State shall develop a plan 
for the administration of the IFG program that includes, as a minimum, 
the items listed below.
    (i) Assignment of grant program responsibilities to State officials 
or agencies.
    (ii) Procedures for:
    (A) Notifying potential grant applicants of the availability of the 
program, to include the publication of application deadlines, pertinent 
program descriptions, and further program information on the 
requirements which must be met by the applicant in order to receive 
assistance;
    (B) Participating with FEMA in the registration and acceptance of 
applications, including late applications, up to the prescribed time 
limitations;
    (C) Reviewing verification data provided by FEMA and performing 
verifications for medical, dental, funeral, and ``other'' expenses, and 
also for all grant categories in the instance of late applications and 
appeals. FEMA will perform any necessary reverifications while its 
contract personnel are in the disaster area, and the State will perform 
any others;
    (D) Determining applicant eligibility and grant amounts, and 
notifying applicants of the State's decision;
    (E) Determining the requirement for flood insurance;
    (F) Preventing duplication of benefits between grant assistance and 
assistance from other means;
    (G) At the applicant's request, and at the State's option, 
reconsidering the State's determinations;
    (H) Processing applicant appeals, recognizing that the State has 
final authority. Such procedures must provide for:
    (1) The receipt of oral or written evidence from the appellate or 
representative;
    (2) A determination on the record; and
    (3) A decision by an impartial person or board;
    (I) Disbursing grants in a timely manner;
    (J) Verifying by random sample that grant funds are meeting 
applicants' needs, are not duplicating assistance from other means, and 
are meeting floodplain management and flood insurance requirements. 
Guidance on the sample size will be provided by the Regional Director;
    (K) Recovering grant funds obtained fraudulently, expended for 
unauthorized items or services, expended for items for which assistance 
is received from other means, or authorized for acquisition or 
construction purposes where proof of purchase of flood insurance is not 
provided to the State. Except for those mentioned in the previous 
sentence, grants made properly by the State on the basis of federally 
sponsored verification information are not subject to recovery by the 
State, i.e., FEMA will not hold the State responsible for repaying to 
FEMA the Federal share of those grants. The State is responsible for its 
25 percent

[[Page 455]]

share of those grants. As an attachment to its voucher, the State must 
identify each case where recovery actions have been taken or are to be 
taken, and the steps taken or to be taken to accomplish recovery;
    (L) Conducting any State audits that might be performed in 
compliance with the Single Audit Act of 1984; and ensuring that 
appropriate corrective action is taken within 6 months after receipt of 
the audit report in instances of noncompliance with Federal laws and 
regulations;
    (M) Reporting to the Regional Director, and to the Federal 
Coordinating Officer as required; and
    (N) Reviewing and updating the plan each January.
    (iii) National eligibility criteria as defined in paragraph (d) of 
this section.
    (iv) Provisions for compliance with 44 CFR part 13, Uniform 
Administrative Requirements for Grants and Cooperative Agreements to 
State and Local Governments; 44 CFR part 11, Claims; the State's own 
debt collection procedures; and all applicable Federal laws and 
regulations.
    (v) Pertinent time limitations for accepting applications, grant 
award activities, and administrative activities, to comply with Federal 
time limitations.
    (vi) Provisions for specifically identifying, in the accounts of the 
State, all Federal and State funds committed to each grant program; for 
repaying the loaned State share as of the date agreed upon in the FEMA-
State Agreement; and for immediately returning, upon discovery, all 
Federal funds that are excess to program needs.
    (vii) Provisions for safeguarding the privacy of applicants and the 
confidentiality of information, except that the information may be 
provided to agencies or organizations who require it to make eligibility 
decisions for assistance programs, or to prevent duplication of 
benefits, to State agencies responsible for audit or program review, and 
to FEMA or the General Accounting Office for the purpose of making 
audits or conducting program reviews.
    (viii) A section identifying the management and staffing functions 
in the IFG program, the sources of staff to fill these functions, and 
the management and oversight responsibilities of:
    (A) The GAR;
    (B) The department head responsible for the IFG program;
    (C) The Grant Coordinating Officer, i.e., the State official 
assigned management responsibility for the IFG program; and
    (D) The IFG program manager, where management responsibilities are 
assigned to such a person on a day-to-day basis.
    (2) The Governor or his/her designee may request the Regional 
Director to provide technical assistance in the preparation of an 
administrative plan to implement this program.
    (3) The Governor shall submit a revised State administrative plan 
each January to the Regional Director. The Regional Director shall 
review and approve the plan annually. In each disaster for which 
assistance under this section is requested, the Regional Director shall 
request the State to prepare any amendments required to meet current 
policy guidance. The Regional Director must then work with the State 
until the plan and amendment(s) are approved.
    (4) The State shall make its approved administrative plan part of 
the State emergency plan, as described in subpart A of these 
regulations.
    (f) State initiation of the IFG program. To make assistance under 
this section available to disaster victims, the Governor must, either in 
the request of the President for a major disaster declaration or by 
separate letter to the Regional Director, express his/her intention to 
implement the program. This expression of intent must include an 
estimate of the size and cost of the program. In addition, this 
expression of intent represents the Governor's agreement to the 
following:
    (1) That the program is needed to satisfy necessary expenses and 
serious needs of disaster victims which cannot otherwise be met;
    (2) That the State will pay its 25 percent share of all grants to 
individuals and families;
    (3) That the State will return immediately upon discovery advanced 
Federal funds that exceed actual requirements;

[[Page 456]]

    (4) To implement an administrative plan as identified in paragraph 
(e) of this section;
    (5) To implement the grant program throughout the area designated as 
eligible for assistance by the Associate Director; and
    (6) To maintain close coordination with and provide reports to the 
Regional Director.
    (g) Funding. (1) The Regional Director may obligate the Federal 
share of the IFG program based upon the determination that:
    (i) The Governor has indicated the intention to implement the 
program, in accordance with paragraph (f) of this section;
    (ii) The State's administrative plan meets the requirements of this 
section and current policy guidance; and
    (iii) There is no excess advance of the Federal share due FEMA from 
a prior IFG program. The State may eliminate any such debt by paying it 
immediately, or by accepting an offset of the owed funds against other 
funds payable by FEMA to the State. When the excess Federal share has 
been repaid, the Regional Director may then obligate funds for the 
Federal share for the current disaster.
    (2) The Regional Director may increase the State's letter of credit 
to meet the Federal share of program needs if the above conditions are 
met. The State may withdraw funds for the Federal share in the amount 
made available to it by the Regional Director. Advances to the State are 
governed by 44 CFR 13.21, Payment.
    (3) The Regional Director may lend to the State its share in 
accordance with subpart A of these regulations.
    (4) Payable costs are governed by 44 CFR 13.22, Allowable Costs, and 
the associated OMB Circular A-87, Cost Principles for State and Local 
Governments. Also, the costs must be in accordance with the national 
eligibility criteria stated in paragraph (d) of this section, and the 
State's administrative plan, as stated in paragraph (e) of this section. 
The Federal contribution to this program shall be 75 percent of program 
costs and shall be made in accordance with 44 CFR 13.25, Matching or 
Cost-Sharing.
    (h) Final payment. Final payment to the State for the Federal share 
of the IFG program plus administrative costs, is governed by 44 CFR 
l3.21, Payment, and 44 CFR 13.50, Closeout. The voucher is Standard Form 
270, Request for Advance or Reimbursement). A separate voucher for the 
State share will be prepared, to include all disaster programs for which 
the State is requesting a loan of the nonfederal share. The FEMA 
Regional Director will analyze the voucher and approve, disapprove, or 
suspend approval until deficiencies are corrected.
    (i) Audits. The State should perform the audits required by the 
Single Audit Act of 1984. Refer to 44 CFR part 14, Administration of 
Grants; Audits of State and Local Governments, which implements OMB 
Circular A-128 regarding audits. All programs are subject to Federal 
audit.
    (j) Time limitations. (1) In the administration of the IFG program:
    (i) The Governor shall indicate his/her intention to implement the 
IFG program no later than 7 days following the day on which the major 
disaster was declared and in the manner set forth in paragraph (f) of 
this section;
    (ii) Applications shall be accepted from individuals or families for 
a period of 60 days following the declaration, and for no longer than 30 
days thereafter when the State determines that extenuating circumstances 
beyond the applicants' control (such as, but not limited to, 
hospitalization, illness, or inaccessibility to application centers) 
prevented them from applying in a timely manner. Exception: If 
applicants exercising their responsibility to first apply to the Small 
Business Administration do so after SBA's deadline, and SBA accepts 
their case for processing because of ``substantial causes essentially 
beyond the control of the applicant,'' and provides a formal decline or 
insufficient loan based on lack of repayment ability, unsatisfactory 
credit, or unsatisfactory experience with prior loans (i.e., the reasons 
a loan denial client would normally be eligible for IFG assistance), 
then such an application referred to the State by the SBA is considered 
as meeting the IFG filing deadline. The State may then apply its own 
criteria

[[Page 457]]

in determining whether to process the case for grant assistance. The 
State automatically has an extension of time to complete the processing, 
eligibility, and disbursement functions. However, the State must still 
complete all administrative activity within the 270-day period described 
in this section.
    (iii) The State shall complete all grant award activity, including 
eligibility determinations, disbursement, and disposition of State level 
appeals, within 180 days following the declaration date. The Regional 
Director shall suspend all grant awards disbursed after the specified 
completion date; and
    (iv) The State shall complete all administrative activities and 
submit final reports and vouchers to the Regional Director within 90 
days of the completion of all grant award activity.
    (2) The GAR may submit a request with appropriate justification for 
the extension of any time limitation. The Regional Director may approve 
the request for a period not to exceed 90 days. The Associate Director 
may approve any request for a further extension of the time limitations.
    (k) Appeals--(1) Bills for collection (BFC's). The State may appeal 
the issuance of a BFC by the Regional Director. Such an appeal shall be 
made in writing within 60 days of the issuance of the bill. The appeal 
must include information justifying why the bill is incorrect. The 
Regional Director shall review the material submitted and notify the 
State, in writing, within 15 days of receipt of the appeal, of his/her 
decision. Interest on BFC's starts accruing on the date of issuance of 
the BFC, but is not charged if the State pays within 30 days of 
issuance. If the State is successful in its appeal, interest will not be 
charged; if unsuccessful, interest is due and payable, as above.
    (2) Other appeals. The State may appeal any other decision of the 
regional Director. Such appeals shall be made in writing within 60 days 
of the Regional Director's decision. The appeal must include information 
justifying a reversal of the decision. The Regional Director shall 
review the material submitted and notify the State, in writing, within 
15 days of receipt of the appeal, of his/her decision.
    (3) Appeals to the Associate Director. The State may further appeal 
the Regional Director's decisions to the Associate Director. This appeal 
shall be made in writing within 60 days of the Regional Director's 
decision. The appeal must include information justifying a reversal of 
the decision. The Associate Director shall review the material submitted 
and notify the State, in writing, within 15 days of receipt of the 
appeal, of his/her decision.
    (l) Exemption from garnishment. All proceeds received or receivable 
under the IFG program shall be exempt from garnishment, seizure, 
encumbrance, levy, execution, pledge, attachment, release, or waiver. No 
rights under this provision are assignable or transferable. The above 
exemptions will not apply to the requirement imposed by paragraph 
(e)(1)(ii)(K) of this section.
    (m) Debt collection. If the State has been unable to recover funds 
as stated in paragraph (e)(1)(k) of this section, the Regional Director 
shall institute debt collection activities against the individual 
according to the procedures outlined in 44 CFR part 11, Claims, and 44 
CFR 13.52, Collection of Amounts Due.

[54 FR 11615, Mar. 21, 1989, as amended at 55 FR 28627, July 12, 1990; 
60 FR 7130, Feb. 7, 1995; 61 FR 19201, May 1, 1996]



Secs. 206.132-206.140  [Reserved]



                 Subpart F--Other Individual Assistance



Sec. 206.141  Disaster unemployment assistance.

    The authority to implement the disaster unemployment assistance 
(DUA) program authorized by section 410 of the Stafford Act, and the 
authority to issue regulations, are currently delegated to the Secretary 
of Labor.



Secs. 206.142-206.150  [Reserved]



Sec. 206.151  Food commodities.

    (a) The Associate Director will assure that adequate stocks of food 
will be ready and conveniently available for emergency mass feeding or 
distribution in any area of the United States which suffers a major 
disaster or emergency.

[[Page 458]]

    (b) In carrying out the responsibilities in paragraph (a) of this 
section, the Associate Director may direct the Secretary of Agriculture 
to purchase food commodities in accordance with authorities prescribed 
in section 413(b) of the Stafford Act.



Secs. 206.152-206.160  [Reserved]



Sec. 206.161  Relocation assistance.

    Notwithstanding any other provision of law, no person otherwise 
eligible for any kind of replacement housing payment under the Uniform 
Relocation Assistance and Real Property Acquisition Policies Act of 1970 
(Pub. L. 91-646) shall be denied such eligibility as a result of his 
being unable, because of a major disaster as determined by the 
President, to meet the occupancy requirements set by such Act.



Secs. 206.162-206.163  [Reserved]



Sec. 206.164  Disaster legal services.

    (a) Legal services, including legal advice, counseling, and 
representation in non fee-generating cases, except as provided in 
paragraph (b) of this section, may be provided to low-income individuals 
who require them as a result of a major disaster. For the purpose of 
this section, low-income individuals means those disaster victims who 
have insufficient resources to secure adequate legal services, whether 
the insufficiency existed prior to or results from the major disaster. 
In cases where questions arise about the eligibility of an individual 
for legal services, the Regional Director or his/her representative 
shall make a determination.
    (b) Disaster legal services shall be provided free to such 
individuals. Fee-generating cases shall not be accepted by lawyers 
operating under these regulations. For purposes of this section, a fee-
generating case is one which would not ordinarily be rejected by local 
lawyers as a result of its lack of potential remunerative value. Where 
any question arises as to whether a case is fee-generating as defined in 
this section, the Regional Director or his/her representative, after any 
necessary consultation with local or State bar associations, shall make 
the determination. Any fee-generating cases shall be referred by the 
Regional Director or his/her representative to private lawyers, through 
existing lawyer referral services, or, where that is impractical or 
impossible, the Regional Director may provide a list of lawyers from 
which the disaster victim may choose. Lawyers who have rendered 
voluntary legal assistance under these regulations are not precluded 
from taking fee-generating cases referred to them in this manner while 
in their capacity as private lawyers.
    (c) When the Regional Director determines after any necessary 
consultation with the State Coordinating Officer, that implementation of 
this section is necessary, provision of disaster legal services may be 
accomplished by:
    (1) Use of volunteer lawyers under the terms of appropriate 
agreements;
    (2) Use of Federal lawyers, provided that these lawyers do not 
represent an eligible disaster victim before a court or Federal agency 
in a matter directly involving the United States, and further provided 
that these lawyers do not act in a way which will violate the standards 
of conduct of their respective agencies or departments;
    (3) Use of private lawyers who may be paid by the Federal Emergency 
Management Agency when the Regional Director has determined that there 
is no other means of obtaining adequate legal assistance for qualified 
disaster victims; or
    (4) Any other arrangement the Regional Director deems appropriate.
    The Associate Director shall coordinate with appropriate Federal 
agencies and the appropriate national, state and local bar associations, 
as necessary, in the implementation of the disaster legal services 
programs.
    (d) In the event it is necessary for FEMA to pay lawyers for the 
provision of legal services under these regulations, the Regional 
Director, in consultation with State and local bar associations, shall 
determine the amount of reimbursement due to the lawyers who have 
provided disaster legal services at the request of the Regional 
Director. At the Regional Director's discretion, administrative costs of 
lawyers providing legal services requested by him or her may also be 
paid.

[[Page 459]]

    (e) Provision of disaster legal services is confined to the securing 
of benefits under the Act and claims arising out of a major disaster.
    (f) Any disaster legal services shall be provided in accordance with 
subpart A of these regulations, Non-discrimination in disaster 
assistance.



Secs. 206.165-206.170  [Reserved]



Sec. 206.171  Crisis counseling assistance and training.

    (a) Purpose. This section establishes the policy, standards, and 
procedures for implementing section 416 of the Act, Crisis Counseling 
Assistance and Training. FEMA will look to the Director, National 
Institute of Mental Health (NIMH), as the delegate of the Secretary of 
the Department of Health and Human Services (DHHS).
    (b) Definitions. (1) Assistant Associate Director means the head of 
the Office of Disaster Assistance Programs, FEMA; the official who 
approves or disapproves a request for assistance under section 416 of 
the Act, and is the final appeal authority.
    (2) Crisis means any life situation resulting from a major disaster 
or its aftermath which so affects the emotional and mental equilibrium 
of a disaster victim that professional mental health counseling services 
should be provided to help preclude possible damaging physical or 
psychological effects.
    (3) Crisis counseling means the application of individual and group 
treatment procedures which are designed to ameliorate the mental and 
emotional crises and their subsequent psychological and behavioral 
conditions resulting from a major disaster or its aftermath.
    (4) Federal Coordinating Officer (FCO) means the person appointed by 
the Associate Director to coordinate Federal assistance in an emergency 
or a major disaster.
    (5) Grantee means the State mental health agency or other local or 
private mental health organization which is designated by the Governor 
to receive funds under section 416 of the Act.
    (6) Immediate services means those screening or diagnostic 
techniques which can be applied to meet mental health needs immediately 
after a major disaster. Funds for immediate services may be provided 
directly by the Regional Director to the State or local mental health 
agency designated by the Governor, prior to and separate from the 
regular program application process of crisis counseling assistance.
    (7) Major disaster means any natural catastrophe (including any 
hurricane, tornado, storm, high water, winddriven water, tidal wave, 
tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm 
or drought), or, regardless of cause, any fire, flood, or explosion, in 
any part of the United States, which in the determination of the 
President causes damage of sufficient severity and magnitude to warrant 
major disaster assistance under this Act to supplement the efforts and 
available resources of States, local governments, and disaster relief 
organizations in alleviating the damage, loss, hardship, or suffering 
caused thereby.
    (8) Project Officer means the person assigned by the Secretary, 
DHHS, to monitor a crisis counseling program, provide consultation, 
technical assistance, and guidance, and be the contact point within the 
DHHS for program matters.
    (9) Regional Director means the director of a regional office of 
FEMA, or the Disaster Recovery Manager, as the delegate of the Regional 
Director.
    (10) Secretary means the Secretary of DHHS or his/her delegate.
    (11) State Coordinating Officer (SCO) means the person appointed by 
the Governor to act in cooperation with the FCO.
    (c) Agency policy. (1) It is agency policy to provide crisis 
counseling services, when required, to victims of a major disaster for 
the purpose of relieving mental health problems caused or aggravated by 
a major disaster or its aftermath. Assistance provided under this 
section is short-term in nature and is provided at no cost to eligible 
disaster victims.
    (2) The Regional Director and Assistant Associate Director, in 
fulfilling their responsibilities under this section, shall coordinate 
with the Secretary.
    (3) In meeting the responsibilities under this section, the 
Secretary or

[[Page 460]]

his/her delegate will coordinate with the Assistant Associate Director.
    (d) State initiation of the crisis counseling program. To obtain 
assistance under this section, the Governor or his/her authorized 
representative must initiate an assessment of the need for crisis 
counseling services within 10 days of the date of the major disaster 
declaration. The purpose of the assessment is to provide an estimate of 
the size and cost of the program needed and to determine if supplemental 
Federal assistance is required. The factors of the assessment must 
include those described in paragraphs (f)(2) (ii) and (iii) and (g)(2) 
(iii) and (iv) of this section.
    (e) Public or private mental health agency programs. If the Governor 
determines during the assessment that because of unusual circumstances 
or serious conditions within the State or local mental health network, 
the State cannot carry out the crisis counseling program, he/she may 
identify a public or private mental health agency or organization to 
carry out the program or request the Regional Director to identify, with 
the assistance of the Secretary, such an agency or organization. 
Preference should be given to the extent feasible and practicable to 
those public and private agencies or organizations which are located in 
or do business primarily in the major disaster area.
    (f) Immediate services. If, during the course of the assessment, the 
State determines that immediate mental health services are required 
because of the severity and magnitude of the disaster, and if State or 
local resources are insufficient to provide these services, the State 
may request and the Regional Director, upon determining that State 
resources are insufficient, may provide funds to the State, separate 
from the application process for regular program funds (described at 
paragraph (g) of this section).
    (1) The application must be submitted to the Regional Director no 
later than 14 days following the declaration of the major disaster. This 
application represents the Governor's agreement and/or certification:
    (i) That the requirements are beyond the State and local 
governments' capabilities;
    (ii) That the program, if approved, will be implemented according to 
the plan contained in the application approved by the Regional Director;
    (iii) To maintain close coordination with and provide reports to the 
Regional Director; and
    (iv) To include mental health disaster planning in the State's 
emergency plan prepared under title II of the Stafford Act.
    (2) The application must include:
    (i) The geographical areas within the designated disaster area for 
which services will be provided;
    (ii) An estimate of the number of disaster victims requiring 
assistance;
    (iii) A description of the State and local resources and 
capabilities, and an explanation of why these resources cannot meet the 
need;
    (iv) A description of response activities from the date of the 
disaster incident to the date of application;
    (v) A plan of services to be provided to meet the identified needs; 
and
    (vi) A detailed budget, showing the cost of proposed services 
separately from the cost of reimbursement for any eligible services 
provided prior to application.
    (3) Reporting requirements. The State shall submit to the Regional 
Director:
    (i) A mid-program report only when a regular program grant 
application is being prepared and submitted. This report will be 
included as part of the regular program grant application;
    (ii) A final program report, a financial status report, and a final 
voucher 90 days after the last day of immediate services funding.
    (4) Immediate services program funding:
    (i) Shall not exceed 60 days following the declaration of the major 
disaster, except when a regular program grant application has been 
submitted;
    (ii) May continue for up to 30 additional days when a regular 
program grant application has been submitted;
    (iii) May be extended by the Regional Director, upon written request 
from the State, documenting extenuating circumstances; and
    (iv) May reimburse the State for documented, eligible expenses from 
the date of the occurrence of the event or

[[Page 461]]

incurred in anticipation of and immediately preceding the disaster event 
which results in a declaration.
    (v) Any funds granted pursuant to an immediate services program, 
paragraph (f) of this section, shall be expended solely for the purposes 
specified in the approved application and budget, these regulations, the 
terms and conditions of the award, and the applicable principles 
prescribed in 44 CFR part 13.
    (5) Appeals. There are two levels of appeals. If a State submits 
appeals at both levels, the first appeal must be submitted early enough 
to allow the latter appeal to be submitted within 60 days following the 
date of the funding determination on the immediate services program 
application.
    (i) The State may appeal the Regional Director's decision. This 
appeal must be submitted in writing within 60 days of the date of 
notification of the application decision, but early enough to allow for 
further appeal if desired. The appeal must include information 
justifying a reversal of the decision. The Regional Director shall 
review the material submitted, and after consultation with the 
Secretary, notify the State, in writing within 15 days of receipt of the 
appeal, of his/her decision;
    (ii) The State may further appeal the Regional Director's decision 
to the Assistant Associate Director. This appeal shall be made in 
writing within 60 days of the date of the Regional Director's 
notification of the decision on the immediate services application. The 
appeal must include information justifying a reversal of the decision. 
The Assistant Associate Director, or other impartial person, shall 
review the material submitted, and after consultation with the Secretary 
and Regional Director, notify the State, in writing, within 15 days of 
receipt of the appeal, of his/her decision.
    (g) Regular program. (1) The application must be submitted by the 
Governor or his/her authorized representative to the Assistant Associate 
Director through the Regional Director, and simultaneously to the 
Secretary no later than 60 days following the declaration of the major 
disaster. This application represents the Governor's agreement and/or 
certification:
    (i) That the requirements are beyond the State and local 
governments' capabilities;
    (ii) That the program, if approved, will be implemented according to 
the plan contained in the application approved by the Assistant 
Associate Director;
    (iii) To maintain close coordination with and provide reports to the 
Regional Director, the Assistant Associate Director, and the Secretary; 
and
    (iv) To include mental health disaster planning in the State's 
emergency plan prepared under title II of the Stafford Act.
    (2) The application must include:
    (i) Standard Form 424, Application for Federal Assistance;
    (ii) The geographical areas within the designated disaster area for 
which services will be supplied;
    (iii) An estimate of the number of disaster victims requiring 
assistance. This documentation of need should include the extent of 
physical, psychological, and social problems observed, the types of 
mental health problems encountered by victims, and a description of how 
the estimate was made;
    (iv) A description of the State and local resources and 
capabilities, and an explanation of why these resources cannot meet the 
need;
    (v) A plan of services which must include at a minimum:
    (A) The manner in which the program will address the needs of the 
affected population, including the types of services to be offered, an 
estimate of the length of time for which mental health services will be 
required, and the manner in which long-term cases will be handled;
    (B) A description of the organizational structure of the program, 
including designation by the Governor of an individual to serve as 
administrator of the program. If more than one agency will be delivering 
services, the plan to coordinate services must also be described;
    (C) A description of the training program for project staff, 
indicating the number of workers needing such training;
    (D) A description of the facilities to be utilized, including plans 
for securing

[[Page 462]]

office space if necessary to the project; and
    (E) A detailed budget, including identification of the resources the 
State and local governments will commit to the project, proposed funding 
levels for the different agencies if more than one is involved, and an 
estimate of the required Federal contribution.
    (3) Reporting requirements. The State shall submit the following 
reports to the Regional Director, the Secretary, and the State 
Coordinating Officer:
    (i) Quarterly progress reports, as required by the Regional Director 
or the Secretary, due 30 days after the end of the reporting period. 
This is consistent with 44 CFR 13.40, Monitoring and Reporting Program 
Performance;
    (ii) A final program report, to be submitted within 90 days after 
the end of the program period. This is also consistent with 44 CFR 
13.40, Monitoring and Reporting Program Performance;
    (iii) An accounting of funds, in accordance with 44 CFR 13.41, 
Financial Reporting, to be submitted with the final program report; and
    (iv) Such additional reports as the Regional Director, Secretary, or 
SCO may require.
    (4) Regular program funding:
    (i) Shall not exceed 9 months from the date of the DHHS notice of 
grant award, except that upon the request of the State to the Regional 
Director and the Secretary, the Assistant Associate Director may 
authorize up to 90 days of additional program period because of 
documented extenuating circumstances;
    (ii) The amount of the regular program grant award will take into 
consideration the Secretary's estimate of the sum necessary to carry out 
the grant purpose.
    (iii) Any funds granted pursuant to a regular program, paragraph (g) 
of this section, shall be expended solely for the purposes specified in 
the approved application and budget, these regulations, the terms and 
conditions of the award, and the applicable cost principles prescribed 
in subpart Q of 45 CFR part 92.
    (5) Appeals. The State may appeal the Assistant Associate Director's 
decision, in writing, within 60 days of the date of notification of the 
decision. The appeal must include information justifying a reversal of 
the decision. The Assistant Associate Director, or other impartial 
person, in consultation with the Secretary and Regional Director, shall 
review the material submitted and notify the State, in writing within 15 
days of receipt of the appeal, of his/her decision.
    (h) Eligibility guidelines. (1) For services. An individual may be 
eligible for crisis counseling services if he/she was a resident of the 
designated major disaster areas or was located in the area at the time 
of the disaster event and if:
    (i) He/she has a mental health problem which was caused or 
aggravated by the major disaster or its aftermath; or
    (ii) He/she may benefit from preventive care techniques.
    (2) For training. (i) The crisis counseling project staff or 
consultants to the project are eligible for the specific instruction 
that may be required to enable them to provide professional mental 
health crisis counseling to eligible individuals;
    (ii) All Federal, State, and local disaster workers responsible for 
assisting disaster victims are eligible for general instruction designed 
to enable them to deal effectively and humanely with disaster victims.
    (i) Assignment of responsibilities. (1) The Regional Director shall:
    (i) In the case of an immediate services program application, 
acknowledge receipt of the request, verify (with assistance from the 
Secretary) that State resources are insufficient, approve or disapprove 
the State's application, obligate and advance funds for this purpose, 
review appeals, make a determination (with assistance from the 
Secretary), and notify the State;
    (ii) In the case of a regular program grant application:
    (A) Acknowledge receipt of the request;
    (B) Request the Secretary to conduct a review to determine the 
extent to which assistance requested by the Governor or his/her 
authorized representative is warranted;
    (C) Considering the Secretary's recommendation, recommend approval 
or

[[Page 463]]

disapproval of the application for assistance under this section; and 
forward the Regional Director's and Secretary's recommendations and 
documentation to the Assistant Associate Director;
    (D) Assist the State in preliminary surveys and provide guidance and 
technical assistance if requested to do so; and
    (E) Maintain liaison with the Secretary and look to the Secretary 
for program oversight and monitoring.
    (2) The Secretary shall:
    (i) Provide technical assistance, consultation, and guidance to the 
Regional Director in reviewing a State's application, to a State during 
program implementation and development, and to mental health agencies, 
as appropriate;
    (ii) At the request of the Regional Director, conduct a review to 
verify the extent to which the requested assistance is needed and 
provide a recommendation on the need for supplementary Federal 
assistance. The review must include:
    (A) A verification of the need for services with an indication of 
how the verification was conducted;
    (B) Identification of the Federal mental health programs in the 
area, and the extent to which such existing programs can help alleviate 
the need;
    (C) An identification of State, local, and private mental health 
resources, and the extent to which these resources can assume the 
workload without assistance under this section and the extent to which 
supplemental assistance is warranted;
    (D) A description of the needs; and
    (E) A determination of whether the plan adequately addresses the 
mental health needs;
    (iii) If the application is approved, provide grant assistance to 
States or the designated public or private entities;
    (iv) If the application is approved, monitor the progress of the 
program and perform program oversight;
    (v) Coordinate with, and provide program reports to, the Regional 
Director, and the Assistant Associate Director;
    (vi) Make the appeal determination, for regular program grants, 
involving allowable costs and termination for cause as described in 
paragraph (j)(2) of this section;
    (vii) As part of the project monitoring responsibilities, report to 
the Regional Director and Assistant Associate Director at least 
quarterly on the progress of crisis counseling programs, in a report 
format jointly agreed upon by the Secretary and FEMA; provide special 
reports, as requested by the Regional Director, FCO, or Assistant 
Associate Director;
    (viii) Require progress reports and other reports from the grantee 
to facilitate his/her project monitoring responsibilities;
    (ix) Properly account for all Federal funds made available to 
grantees under this section. Submit to the Assistant Associate Director, 
within 120 days of completion of a program, a final accounting of all 
expenditures for the program and return to FEMA all excess funds. 
Attention is called to the reimbursement requirements of this part.
    (3) The Assistant Associate Director shall:
    (i) Approve or disapprove a State's request for assistance based on 
recommendations of the Regional Director and the Secretary;
    (ii) Obligate funds and authorize advances of funds to the DHHS;
    (iii) Request that the Secretary designate a Project Officer;
    (iv) Maintain liaison with the Secretary and Regional Director; and
    (v) Review and make determinations on appeals, except for regular 
program appeals involving allowable costs and termination for cause as 
described in paragraph (j)(2) of this section, and notify the State of 
the decision.
    (j) Grant awards. (1) Neither the approval of any application nor 
the award of any grant commits or obligates the United States in any way 
to make any additional, supplemental, continuation, or other award with 
respect to any approved application or portion of any approved 
application.
    (2) Several other regulations of the DHHS apply to grants under this 
section. These include, but are not limited to:

45 CFR part 16--DHHS grant appeals procedures
42 CFR part 50, subpart D--PHS grant appeals procedures

[[Page 464]]

45 CFR part 74--Administration of grants
45 CFR part 75--Informal grant appeals procedures (indirect cost rates 
and other cost allocations)
45 CFR part 80--Nondiscrimination under programs receiving Federal 
assistance through the DHHS (effectuation of Title VI of the Civil 
Rights Act of 1964)
45 CFR part 81--Practice and procedure for hearings under part 80
45 CFR part 84--Nondiscrimination on the basis of handicap in federally 
assisted programs
45 CFR part 86--Nondiscrimination on the basis of sex in federally 
assisted programs
45 CFR part 91--Nondiscrimination on the basis of age in federally 
assisted programs
45 CFR part 92--Uniform administrative requirements for grants and 
cooperative agreements to State and local governments.

    (k) Federal audits. The crisis counseling program is subject to 
Federal audit. The Associate Director, the Regional Director, the FEMA 
Inspector General, The Secretary, and the Comptroller General of the 
United States, or their duly authorized representatives, shall have 
access to any books, documents, papers, and records that pertain to 
Federal funds, equipment, and supplies received under this section for 
the purpose of audit and examination.



Secs. 206.172-206.180  [Reserved]



Sec. 206.181  Use of gifts and bequests for disaster assistance purposes.

    (a) General. FEMA sets forth procedures for the use of funds made 
possible by a bequest of funds from the late Cora C. Brown of Kansas 
City, Missouri, who left a portion of her estate to the United States 
for helping victims of natural disasters and other disasters not caused 
by or attributable to war. FEMA intends to use the funds, and any others 
that may be bequeathed under this authority, in the manner and under the 
conditions described below.
    (b) Purposes for awarding funds. Money from the Cora Brown Fund may 
only be used to provided for disaster-related needs that have not been 
or will not be met by governmental agencies or any other organizations 
which have programs to address such needs; however, the fund is not 
intended to replace or supersede these programs. For example, if 
assistance is available from another source, including the Individual 
and Family Grant program and government-sponsored disaster loan 
assistance, then money from the Cora Brown Fund will not be available to 
the applicant for the same purpose. Listed below are the general 
categories of assistance which can be provided by the Cora Brown Fund:
    (1) Disaster-related home repair and rebuilding assistance to 
families for permanent housing purposes, including site acquisition and 
development, relocation of residences out of hazardous areas, assistance 
with costs associated with temporary housing or permanent rehousing 
(e.g., utility deposits, access, transportation, connection of 
utilities, etc.);
    (2) Disaster-related unmet needs of families who are unable to 
obtain adequate assistance under the Act or from other sources. Such 
assistance may include but is not limited to: health and safety 
measures; evacuation costs; assistance delineated in the Act or other 
Federal, State, local, or volunteer programs; hazard mitigation or 
floodplain management purposes; and assistance to self-employed persons 
(with no employees) to reestablish their businesses; and
    (3) Other services which alleviate human suffering and promote the 
well being of disaster victims. For example, services to the elderly, to 
children, or to handicapped persons, such as transportation, 
recreational programs, provision of special ramps, or hospital or home 
visiting services. The funds may be provided to individual disaster 
victims, or to benefit a group of disaster victims.
    (c) Conditions for use of the Cora Brown Fund. (1) The Cora Brown 
Fund is available only when the President declares that a major disaster 
or emergency exists under the Act, only in areas designated as eligible 
for Federal disaster assistance through notice in the Federal Register, 
and only at the discretion of the Assistant Associate Director, Office 
of Disaster Assistance

[[Page 465]]

Programs, FEMA. The fund is limited to the initial endowment plus 
accrued interest, and this assistance program will cease when the fund 
is used up.
    (2) A disaster victim normally will receive no more than $2,000 from 
this fund in any one declared disaster unless the Assistant Associate 
Director determines that a larger amount is in the best interest of the 
disaster victim and the Federal Government. Funds to provide service 
which benefit a group may be awarded in an amount determined by the 
Assistant Associate Director, based on the Regional Director's 
recommendation.
    (3) The fund may not be used in a way that is inconsistent with 
other federally mandated disaster assistance or insurance programs, or 
to modify other generally applicable requirements.
    (4) Funds awarded to a disaster victim may be provided by FEMA 
jointly to the disaster victim and to a State or local agency, or 
volunteer organization, to enable such an agent to assist in providing 
the approved assistance to an applicant. Example: Repair funds may be 
provided jointly to an applicant and the Mennonite Disaster Service, who 
will coordinate the purchase of supplies and provide the labor.
    (5) Money from this fund will not duplicate assistance for which a 
person is eligible from other sources.
    (6) In order to comply with the Flood Disaster Protection Act of 
1973 (Pub. L. 93-234), as amended, any award for acquisition or 
construction purposes shall carry a requirement that any adequate flood 
insurance policy be purchased and maintained. The Assistant Associate 
Director shall determine what is adequate based on the purpose of the 
award.
    (7) The fund shall be administered in an equitable and impartial 
manner without discrimination on the grounds of race, color, religion, 
national origin, sex, age, or economic status.
    (8) Funds awarded to a disaster victim from this fund may be 
combined with funds from other sources.
    (d) Administrative procedures. (1) The Assistant Associate Director, 
Office of Disaster Assistance Programs, shall be responsible for 
awarding funds and authorizing disbursement.
    (2) The Comptroller of FEMA shall be responsible for fund 
accountability and, in coordination with the Assistant Associate 
Director, for liaison with the Department of the Treasury concerning the 
investment of excess money in the fund pursuant to the provisions 
contained in section 601 of the Act.
    (3) Each FEMA Regional Director may submit requests to the Assistant 
Associate Director on a disaster victim's behalf by providing 
documentation describing the needs of the disaster victim, a 
verification of the disaster victim's claim, a record of other 
assistance which has been or will be available for the same purpose, and 
his/her recommendation as to the items and the amount. The Assistant 
Associate Director shall review the facts and make a determination. If 
the award amount is below $2,000, the Assistant Associate Director may 
appoint a designee to have approval authority; approval authority of 
$2,000 or above shall be retained by the Assistant Associate Director. 
The Assistant Associate Director shall notify the Comptroller of a 
decision for approval, and the Comptroller shall order a check to be 
sent to the disaster victim (or jointly to the disaster victim and an 
assistance organization), through the Regional Director. The Assistant 
Associate Director shall also notify the Regional Director of the 
decision, whether for approval or disapproval. The Regional Director 
shall notify the disaster victim in writing, identify any award as 
assistance from the Cora Brown Fund, and advise the recipient of appeal 
procedures.
    (4) If the award is to be for a service to a group of disaster 
victims, the Regional Director shall submit his/her recommendation and 
supporting documentation to the Assistant Associate Director (or his/her 
designee if the award is below $2,000), who shall review the information 
and make a determination. In cases of approval, the Assistant Associate 
Director shall request the Comptroller to send a check to the intended 
recipient or provider, as appropriate. The Assistant Associate Director 
shall notify the Regional Director of the decision. The Regional 
Director shall notify a representative of the group in writing.

[[Page 466]]

    (5) The Comptroller shall process requests for checks, shall keep 
records of disbursements and balances in the account, and shall provide 
the Assistant Associate Director with quarterly reports.
    (e) Audits. The Inspector General of FEMA shall audit the use of 
money in this account to determine whether the funds are being 
administered according to these regulations and whether the financial 
management of the account is adequate. The Inspector General shall 
provide his/her findings to the Associate Director, State and Local 
Programs and Support, for information, comments and appropriate action. 
A copy shall be provided to the Comptroller for the same purpose.



Secs. 206.182-206.190  [Reserved]



Sec. 206.191  Duplication of benefits.

    (a) Purpose. This section establishes the policies for implementing 
section 312 of the Stafford Act, entitled Duplication of Benefits. This 
section relates to assistance for individuals and families.
    (b) Government policy. (1) Federal agencies providing disaster 
assistance under the Act or under their own authorities triggered by the 
Act, shall cooperate to prevent and rectify duplication of benefits, 
according to the general policy guidance of the Federal Emergency 
Management Agency. The agencies shall establish appropriate agency 
policies and procedures to prevent duplication of benefits.
    (2) Major disaster and emergency assistance provided to individuals 
and families under the Act, and comparable disaster assistance provided 
by States, local governments, and disaster assistance organizations, is 
not considered as income or a resource when determining eligibility for 
or benefit levels under federally funded income assistance or resource-
tested programs. Examples of federally funded income assistance or 
resource-tested programs are the food stamp program and welfare 
assistance programs.
    (c) FEMA policy. It is FEMA policy:
    (1) To prevent duplication of benefits between its own programs and 
insurance benefits, and between its own programs and other disaster 
assistance. Assistance under the Act may be provided in instances where 
the applicant has not received other benefits to which he/she may be 
entitled by the time of application and if the applicant agrees to repay 
all duplicated assistance to the agency providing the Federal 
assistance;
    (2) To examine a debt resulting from duplication to determine that 
the likelihood of collecting the debt and the best interests of the 
Federal Government justify taking the necessary recovery actions to 
remedy duplication which has occurred when other assistance has become 
available;
    (3) To assure uniformity in preventing duplication of benefits, by 
consulting with other Federal agencies and by performing selected 
quality control reviews, that the other disaster relief agencies 
establish and follow policies and procedures to prevent and remedy 
duplication among their programs, other programs, and insurance 
benefits; and
    (4) To coordinate the effort of agencies providing assistance so 
that each agency understands the prevention and remedial policies of the 
others and is able to fulfill its own responsibilities regarding 
duplication of benefits.
    (d) Guidance to prevent duplication of benefits. (1) Delivery 
sequence. FEMA provides the following policy and procedural guidance to 
ensure uniformity in preventing duplication of benefits.
    (i) Duplication occurs when an agency has provided assistance which 
was the primary responsibility of another agency, and the agency with 
primary responsibility later provides assistance. A delivery sequence 
establishes the order in which disaster relief agencies and 
organizations provide assistance. The specific sequence, in accordance 
with the mandates of the assistance programs, is to be generally 
followed in the delivery of assistance.
    (ii) When the delivery sequence has been disrupted, the disrupting 
agency is responsible for rectifying the duplication. The delivery 
sequence pertains to that period of time in the recovery phase when most 
of the traditional disaster assistance programs are available.
    (2) The delivery sequence is, in order of delivery:

[[Page 467]]

    (i) Volunteer agencies' emergency assistance (except expendable 
items such as clothes, linens, and basic kitchenware); insurance 
(including flood insurance);
    (ii) Temporary housing assistance (to include provision of a housing 
unit and minimal repairs);
    (iii) Small Business Administration and Farmers Home Administration 
disaster loans;
    (iv) Individuals and Family Grant program assistance;
    (v) Volunteer agencies' ``additional assistance'' programs; and
    (vi) The ``Cora Brown Fund.''
    (3) Two significant points about the delivery sequence are that:
    (i) Each assistance agency should, in turn, offer and be responsible 
for delivering assistance without regard to duplication with a program 
later in the sequence; and
    (ii) The sequence itself determines what types of assistance can 
duplicate other assistance (i.e., a Federal program can duplicate 
insurance benefits, however, insurance benefits cannot duplicate the 
Federal assistance). An agency's position in the sequence determines the 
order in which it should provide assistance and what other resources it 
must consider before it does so.
    (4) If following the delivery sequence concept would adversely 
affect the timely receipt of essential assistance by a disaster victim, 
an agency may offer assistance which is the primary responsibility of 
another agency. There also may be cases when an agency (Agency B) 
delivers assistance which is normally the primary responsibility of 
another agency (Agency A) because Agency A has, for good cause, denied 
assistance. After the assistance is delivered, Agency A reopens the 
case. If the primary response Agency A then provides assistance, that 
Agency A is responsible for coordinating with Agency B to either:
    (i) Assist Agency B in preventing the duplication of benefits, or
    (ii) In the case where the disaster victim has refused assistance 
from Agency A, notify Agency B that it must recover assistance 
previously provided.
    (e) Program guidance--(1) Programs under the Act vs. other agency 
assistance. (i) In making an eligibility determination, the FEMA 
Regional Director, in the case of federally operated programs, or the 
State, in the case of State operated programs, shall determine whether 
assistance is the primary responsibility of another agency to provide, 
according to the delivery sequence; and determine whether that primary 
response agency can provide assistance in a timely way.
    (ii) If it is determined that timely assistance can be provided by 
the agency with primary responsibility, refrain from providing 
assistance under the Act. If it is determined that assistance from the 
agency with primary responsibility will be delayed, assistance under the 
Act may be provided, but then must be recovered from the applicant when 
the other assistance becomes available.
    (2) Programs under the Act vs. insurance. In making an eligibility 
determination, the FEMA Regional Director or State shall:
    (i) Remind the applicant about his/her responsibility to pursue an 
adequate settlement. The applicant must provide information concerning 
insurance recoveries.
    (ii) Determine whether the applicant's insurance settlement will be 
sufficient to cover the loss or need without disaster assistance; and
    (iii) Determine whether insurance benefits (including flood 
insurance) will be provided in a timely way. Where flood insurance is 
involved, the Regional Director shall coordinate with the Federal 
Insurance Administration. The purpose of this coordination is to obtain 
information about flood insurance coverage and settlements.
    (3) Random sample. Each disaster assistance agency is responsible 
for preventing and rectifying duplication of benefits under the 
coordination of the Federal Coordinating Officer (FCO) and the general 
authority of section 312. To determine whether duplication has occurred 
and established procedures have been followed, the Regional Director 
shall, within 90 days after the close of the disaster assistance 
programs application period, for selected disaster declarations, examine 
on a random sample basis, FEMA's and other government

[[Page 468]]

and voluntary agencies' case files and document the findings in writing.
    (4) Duplication when assistance under the Act is involved. If 
duplication is discovered, the Regional Director shall determine whether 
the duplicating agency followed its own remedial procedures.
    (i) If the duplicating agency followed its procedures and was 
successful in correcting the duplication, the Regional Director will 
take no further action. If the agency was not successful in correcting 
the duplication, and the Regional Director is satisfied that the 
duplicating agency followed its remedial procedures, no further action 
will be taken.
    (ii) If the duplicating agency did not follow its duplication of 
benefits procedures, or the Regional Director is not satisfied that the 
procedures were followed in an acceptable manner, then the Regional 
Director shall provide an opportunity for the agency to take the 
required corrective action. If the agency cannot fulfill its 
responsibilities for remedial action, the Regional Director shall notify 
the recipient of the excess assistance, and after examining the debt, if 
it is determined that the likelihood of collecting the debt and the best 
interests of the Federal Government justify taking the necessary 
recovery actions, then take those recovery actions in conjunction with 
agency representatives for each identified case in the random sample (or 
larger universe, at the Regional Director's discretion).
    (5) Duplication when assistance under other authorities is involved. 
When the random sample shows evidence that duplication has occurred and 
corrective action is required, the Regional Director and the FCO shall 
urge the duplicating agency to follow its own procedures to take 
corrective action, and shall work with the agency toward that end. Under 
his/her authority in section 312, the Regional Director shall require 
the duplicating agency to report to him/her on its attempt to correct 
the duplications identified in the sample.
    (f) Recovering FEMA funds: debt collection. Funds due to FEMA are 
recovered in accordance with FEMA's Debt Collection Regulations (44 CFR 
part 11, subpart C).



Secs. 206.192-206.199  [Reserved]



           Subpart G--Public Assistance Project Administration

    Source: 55 FR 2304, Jan. 23, 1990, unless otherwise noted.



Sec. 206.200  General.

    (a) Purpose. This subpart establishes procedures for the 
administration of Public Assistance grants approved under the provisions 
of the Stafford Act.
    (b) Policy. It is a requirement of the Stafford Act that, in the 
administration of the Public Assistance Program, eligible assistance be 
delivered as expeditiously as possible consistent with Federal laws and 
regulations. The regulation entitled ``Uniform Requirements for Grants 
and Cooperative Agreements to State and Local Governments'', published 
at 44 CFR part 13, places certain requirements on the State in its role 
as grantee for the public assistance program. The intent of this 
``common rule'' is to allow States more discretion in administering 
Federal programs in accordance with their own procedures and thereby 
simplify the program and reduce delays. FEMA also expects States to make 
subgrants with the requirements of the Stafford Act in mind. They are 
expected to keep subgrantees informed as to the status of their 
application including notification of FEMA's approvals of DSR's and an 
estimate of when payments will be made. Subgrantees should receive the 
full payment approved by FEMA, and the State contribution, as provided 
in the FEMA-State Agreement, as soon as practicable after payment is 
approved. Payment of the State contribution must be consistent with 
State laws.



Sec. 206.201  Definitions.

    (a) Applicant means a State agency, local government, or eligible 
private nonprofit organization, as identified in Subpart H of this 
regulation, submitting an application to the Grantee for assistance 
under the State's grant.
    (b) Emergency work means that work which must be done immediately to 
save lives and to protect improved property and public health and 
safety,

[[Page 469]]

or to avert or lessen the threat of a major disaster.
    (c) Facility means any publicly or privately owned building, works, 
system, or equipment, built or manufactured, or an improved and 
maintained natural feature. Land used for agricultural purposes is not a 
facility.
    (d) Grant means an award of financial assistance. The grant award 
shall be based on the total eligible Federal share of all approved 
projects.
    (e) Grantee means the government to which a grant is awarded which 
is accountable for the use of the funds provided. The grantee is the 
entire legal entity even if only a particular component of the entity is 
designated in the grant award document. For purposes of this regulation, 
except as noted in Sec. 206.202, the State is the grantee.
    (f) Hazard mitigation means any cost effective measure which will 
reduce the potential for damage to a facility from a disaster event.
    (g) Permanent work means that restorative work that must be 
performed through repairs or replacement, to restore an eligible 
facility on the basis of its predisaster design and current applicable 
standards.
    (h) Predisaster design means the size or capacity of a facility as 
originally designed and constructed or subsequently modified by changes 
or additions to the original design. It does not mean the capacity at 
which the facility was being used at the time the major disaster 
occurred if different from the most recent designed capacity.
    (i) Project (also referred to as individual project) means all work 
performed at a single site whether or not described on a single Damage 
Survey Report (DSR).
    (j) Project approval means the process where the RD signs an 
approval of work and costs on a DSR or group of DSR's. Such approval is 
also an obligation of funds to the grantee.
    (k) Subgrant means an award of financial assistance under a grant by 
a grantee to an eligible subgrantee.
    (l) Subgrantee means the government or other legal entity to which a 
subgrant is awarded and which is accountable to the grantee for the use 
of the funds provided.



Sec. 206.202  Application procedures.

    (a) General. This section describes the policies and procedures for 
processing grants for Federal disaster assistance to States. For 
purposes of this regulation the State is the grantee. The State is 
responsible for processing subgrants to applicants in accordance with 44 
CFR parts 13, 14, and 206, and its own policies and procedures.
    (b) Grantee. The Grantee serves as the grant administrator for all 
funds provided under the Public Assistance grant program. The Grantee's 
responsibilities as they pertain to procedures outlined in this section 
include providing technical advice and assistance to eligible 
subgrantees, providing State support for damage survey activities, 
ensuring that all potential applicants are aware of assistance 
available, and submission of those documents necessary for grants award.
    (c) Notice of interest (NOI). The Grantee must submit to the RD a 
completed NOI (FEMA Form 90-49) for each applicant requesting 
assistance. NOI's must be submitted to the RD within 30 days following 
designation of the area is which the damage is located.
    (d) Damage Survey Reports (DSRs). (1) Damage surveys are conducted 
by an inspection team. An authorized local representative accompanies 
the inspection team and is responsible for representing the applicant 
and ensuring that all eligible work and costs are identified. The 
inspectors prepare a Damage Survey Report-Data Sheet (FEMA Form 90-91) 
for each site. On the Damage Survey Report-Data Sheet the inspectors 
will identify the eligible scope of work and prepare a quantitative 
estimate for the eligible work. Any damage that is not shown to the 
inspection team during its initial visit shall be reported in writing to 
the Regional Director by the Grantee within 60 days after the initial 
visit.
    (2) When the estimate of work at a damage site is less than $1000, 
such work is not eligible and a DSR will not be written. This minimum 
amount for a DSR shall be reviewed periodically by FEMA and adjusted 
through regulation as necessary.
    (e) Grant approval. Upon completion of the field surveys the Damage 
Survey Report-Data Sheets are reviewed and

[[Page 470]]

action is taken by the Regional Director (RD). This will be done within 
45 days of the date of inspection or a written explanation of any delay 
will be provided to the grantee. Prior to the obligation of any funds 
the Grantee shall submit a Standard Form (SF) 424, Application for 
Federal Assistance, and SF 424D, Assurances for Construction Programs, 
to the RD. Following receipt of the SF 424 and 424D, the RD will then 
obligate funds to the State based upon the approved DSR's. The grantee 
shall then approve subgrants to the applying entities based upon DSR's 
approved for each applicant.
    (f) Exceptions. The following are exceptions to the above outlined 
procedures and time limitations.
    (1) Grant applications. An Indian tribe or authorized tribal 
organization may submit a SF 424 directly to the RD when assistance is 
authorized under the Act and a State is legally unable to assume the 
responsibilities prescribed in these regulations.
    (2) Time limitations. The time limitations shown in paragraphs (c) 
and (d) of this section may be extended by the RD when justified and 
requested in writing by the Grantee. Such justification shall be based 
on extenuating circumstances beyond the grantee's or subgrantee's 
control.

(Approved by the Office of Management and Budget under Control Numbers 
3067-0033 and 0348-0043.)


[55 FR 2304, Jan. 23, 1990, as amended at 58 FR 47996, Sept. 14, 1993]



Sec. 206.203  Federal grant assistance.

    (a) General. This section describes the types and extent of Federal 
funding available under State disaster assistance grants, as well as 
limitations and special procedures applicable to each.
    (b) Cost sharing. All projects approved under State disaster 
assistance grants will be subject to the cost sharing provisions 
established in the FEMA-State Agreement and the Stafford Act.
    (c) Project funding--(1) Large projects. When the approved estimate 
of eligible costs for an individual project is $35,000 or greater, 
Federal funding shall equal the Federal share of the actual eligible 
costs documented by a grantee. Such $35,000 amount shall be adjusted 
annually to reflect changes in the Consumer Price Index for All Urban 
Consumers published by the Department of Labor.
    (2) Small projects. When the approved estimate of costs for an 
individual project is less than $35,000, Federal funding shall equal the 
Federal share of the approved estimate of eligible costs. Such $35,000 
amount shall be adjusted annually as indicated in paragraph (c)(1) of 
this section.
    (d) Funding options--(1) Improved projects. If a subgrantee desires 
to make improvements, but still restore the predisaster function of a 
damaged facility, the Grantee's approval must be obtained. Federal 
funding for such improved projects shall be limited to the Federal share 
of the approved estimate of eligible costs.
    (2) Alternate projects. In any case where a subgrantee determines 
that the public welfare would not be best served by restoring a damaged 
public facility or the function of that facility, the Grantee may 
request that the RD approve an alternate project.
    (i) The alternate project option may be taken only on permanent 
restorative work.
    (ii) Federal funding for such alternate projects shall equal 90 
percent of the Federal share of the approved estimate of eligible costs.
    (iii) Funds contributed for alternate projects may be used to repair 
or expand other selected public facilities, to construct new facilities, 
or to fund hazard mitigation measures. These funds may not be used to 
pay the nonfederal share of any project, nor for any operating expense.
    (iv) Prior to the start of construction of any alternate project the 
Grantee shall submit for approval by the RD the following: a description 
of the proposed alternate project(s); a schedule of work; and the 
projected cost of the project(s). The Grantee shall also provide the 
necessary assurances to document compliance with special requirements, 
including, but not limited to floodplain management, environmental 
assessment, hazard mitigation, protection of wetlands, and insurance.

[[Page 471]]



Sec. 206.204  Project performance.

    (a) General. This section describes the policies and procedures 
applicable during the performance of eligible work.
    (b) Advances of funds. Advances of funds will be made in accordance 
with 44 CFR 13.21, Payment.
    (c) Time limitations for completion of work--(1) Deadlines. The 
project completion deadlines shown below are set from the date that a 
major disaster or emergency is declared and apply to all projects 
approved under State disaster assistance grants.

                          Completion Deadlines                          
------------------------------------------------------------------------
                         Type of work                            Months 
------------------------------------------------------------------------
Debris clearance..............................................         6
Emergency work................................................         6
Permanent work................................................        18
------------------------------------------------------------------------

    (2) Exceptions. (i) The Grantee may impose lesser deadlines for the 
completion of work under paragraph (c)(1) of this section if considered 
appropriate.
    (ii) Based on extenuating circumstances or unusual project 
requirements beyond the control of the subgrantee, the Grantee may 
extend the deadlines under paragraph (c)(1) of this section for an 
additional 6 months for debris clearance and emergency work and an 
additional 30 months, on a project by project basis for permanent work.
    (d) Requests for time extensions. Requests for time extensions 
beyond the Grantee's authority shall be submitted by the Grantee to the 
RD and shall include the following:
    (1) The dates and provisions of all previous time extensions on the 
project; and
    (2) A detailed justification for the delay and a projected 
completion date. The RD shall review the request and make a 
determination. The Grantee shall be notified of the RD's determination 
in writing. If the RD approves the request, the letter shall reflect the 
approved completion date and any other requirements the RD may determine 
necessary to ensure that the new completion date is met. If the RD 
denies the time extension request, the grantee may, upon completion of 
the project, be reimbursed for eligible project costs incurred only up 
to the latest approved completion date. If the project is not completed, 
no Federal funding will be provided for that project.
    (e) Cost overruns. During the execution of approved work a 
subgrantee may find that actual project costs are exceeding the approved 
DSR estimates. Such cost overruns normally fall into the following three 
categories:
    (1) Variations in unit prices;
    (2) Change in the scope of eligible work; or
    (3) Delays in timely starts or completion of eligible work.
    The subgrantee shall evaluate each cost overrun and, when justified, 
submit a request for additional funding through the grantee to the RD 
for a final determination. All requests for the RD's approval shall 
contain sufficient documentation to support the eligibility of all 
claimed work and costs. The grantee shall include a written 
recommendation when forwarding the request. The RD shall notify the 
Grantee in writing of the final determination. FEMA will not normally 
review an overrun for an individual small project. The normal procedure 
for small projects will be that when a subgrantee discovers a 
significant overrun related to the total final cost for all small 
projects, the subgrantee may submit an appeal for additional funding in 
accordance with Sec. 206.206 below, within 60 days following the 
completion of all of its small projects.
    (f) Progress reports. Progress reports will be submitted by the 
Grantee to the RD quarterly. The RD and Grantee shall negotiate the date 
for submission of the first report. Such reports will describe the 
status of those projects on which a final payment of the Federal share 
has not been made to the grantee and outline any problems or 
circumstances expected to result in noncompliance with the approved 
grant conditions.

[55 FR 2304, Jan. 23, 1990; 55 FR 5458, Feb. 15, 1990]



Sec. 206.205  Payment of claims.

    (a) Small projects. Final payment of the Federal share of these 
projects shall be made to the Grantee upon approval of the project. The 
grantee shall make payment of the Federal share to the subgrantee as 
soon as practicable

[[Page 472]]

after Federal approval of funding. Prior to the closeout of the disaster 
contract, the Grantee shall certify that all such projects were 
completed in accordance with FEMA approvals and that the State 
contribution to the non-Federal share, as specified in the FEMA-State 
Agreement, has been paid to each subgrantee. Such certification is not 
required to specify the amount spent by a subgrantee on small projects. 
The Federal payment for small projects shall not be reduced if all of 
the approved funds are not spent to complete a project. However, failure 
to complete a project may require that the Federal payment be refunded.
    (b) Large projects. (1) The Grantee shall make an accounting to the 
RD of eligible costs for each approved large project. In submitting the 
accounting the Grantee shall certify that reported costs were incurred 
in the performance of eligible work, that the approved work was 
completed, that the project is in compliance with the provisions of the 
FEMA-State Agreement, and that payments for that project have been made 
in accordance with 44 CFR 13.21, Payments. Each large project shall be 
submitted as soon as practicable after the subgrantee has completed the 
approved work and requested payment.
    (2) The RD shall review the accounting to determine the eligible 
amount of reimbursement for each large project and approve eligible 
costs. If a discrepancy between reported costs and approved funding 
exists, the RD may conduct field reviews to gather additional 
information. If discrepancies in the claim cannot be resolved through a 
field review, a Federal audit may be conducted. If the RD determines 
that eligible costs exceed the initial approval, he/she will obligate 
additional funds as necessary.



Sec. 206.206  Appeals.

    (a) Subgrantee. The subgrantee may appeal any determination 
previously made related to Federal assistance for a subgrantee, 
including a time extension determination made by the grantee. The 
subgrantee's appeal shall be made in writing and submitted to the 
grantee within 60 days after receipt of notice of the action which is 
being appealed. The appeal shall contain documented justification 
supporting the subgrantee's position.
    (b) Grantee. Upon receipt of an appeal from a subgrantee, the 
grantee shall review the material submitted, make such additional 
investigations as necessary, and shall forward the appeal with a written 
recommendation to the RD within 60 days.
    (c) Regional Director. Upon receipt of an appeal, the RD shall 
review the material submitted and make such additional investigations as 
deemed appropriate. Within 90 days following receipt of an appeal, the 
RD shall notify the Grantee, in writing, as to the disposition of the 
appeal or of the need for additional information. Within 90 days 
following the receipt of such additional information, the RD shall 
notify the grantee, in writing, of the disposition of the appeal. If the 
decision is to grant the appeal, the RD will take appropriate 
implementing action.
    (d) Associate Director. (1) If the RD denies the appeal, the 
subgrantee may submit a second appeal to the Associate Director. Such 
appeals shall be made in writing, through the grantee and the RD, and 
shall be submitted not later than 60 days after receipt of notice of the 
RD's denial of the first appeal. The Associate Director shall render a 
determination on the subgrantee's appeal within 90 days following 
receipt of the appeal or shall make a request for additional 
information. Within 90 days following the receipt of such additional 
information, the AD shall notify the grantee, in writing, of the 
disposition of the appeal. If the decision is to grant the appeal, the 
RD will be instructed to take appropriate implementing action.
    (2) In appeals involving highly technical issues, the AD, at his/her 
discretion, may ask an independent scientific or technical group or 
person with expertise in the subject matter of the appeal to review the 
appeal in order to obtain the best possible evaluation. In such cases, 
the 90 day time limit will run from the submission of the technical 
report.
    (e) Director. (1) If the AD denies the appeal, the subgrantee may 
submit an appeal to the Director of FEMA. Such appeals shall be made in 
writing, through the grantee and the RD, and

[[Page 473]]

shall be submitted not later than 60 days after receipt of notice of the 
AD's denial of the second appeal.
    (2) The Director shall render a determination on the subgrantee's 
appeal within 90 days following receipt of the appeal or shall make a 
request for additional information if such is necessary. Within 90 days 
following the receipt of such additional information, the Director shall 
render a determination and notify the grantee, in writing, of the 
disposition of the appeal. If the decision is to grant the appeal, the 
RD will be instructed to take appropriate implementing action.
    (3) In appeals involving highly technical issues, the Director may, 
at his/her discretion, submit the appeal to an independent scientific or 
technical person or group having expertise in the subject matter of the 
appeal for advice and recommendation. Before making the selection of 
this person or group, the Director may consult with the grantee and/or 
the subgrantee.
    (4) The Director may also submit appeals which he/she receives to 
persons who are not associated with FEMA's Disaster Assistance Programs 
office for recommendations on the resolution of appeals.
    (5) Within 60 days after the submission of a recommendation made 
pursuant to paragraphs (d) (3) and (4) of this section, the Director 
shall render a determination and notify the grantee of the disposition 
of the appeal.



Sec. 206.207  Administrative and audit requirements.

    (a) General. Uniform administrative requirements which are set forth 
in 44 CFR part 13 apply to all disaster assistance grants and subgrants.
    (b) State administrative plan. (1) The State shall develop a plan 
for the administration of the Public Assistance program that includes at 
a minimum, the items listed below:
    (i) The designation of the State agency or agencies which will have 
the responsibility for program administration.
    (ii) The identification of staffing functions in the Public 
Assistance program, the sources of staff to fill these functions, and 
the management and oversight responsibilities of each.
    (iii) Procedures for:
    (A) Notifying potential applicants of the availability of the 
program;
    (B) Conducting briefings for potential applicants and application 
procedures, program eligibility guidance and program deadlines;
    (C) Assisting FEMA in determining applicant eligibility;
    (D) Participating with FEMA in conducting damage surveys to serve as 
a basis for obligations of funds to subgrantees;
    (E) Participating with FEMA in the establishment of hazard 
mitigation and insurance requirements;
    (F) Processing appeal requests, requests for time extensions and 
requests for approval of overruns, and for processing appeals of grantee 
decisions;
    (G) Compliance with the administrative requirements of 44 CFR parts 
13 and 206;
    (H) Compliance with the audit requirements of 44 CFR part 14;
    (I) Processing requests for advances of funds and reimbursement; and
    (J) Determining staffing and budgeting requirements necessary for 
proper program management.
    (2) The Grantee may request the RD to provide technical assistance 
in the preparation of such administrative plan.
    (3) In accordance with the Interim Rule published March 21, 1989, 
the Grantee was to have submitted an administrative plan to the RD for 
approval by September 18, 1989. An approved plan must be on file with 
FEMA before grants will be approved in a future major disaster. 
Thereafter, the Grantee shall submit a revised plan to the RD annually. 
In each disaster for which Public Assistance is included, the RD shall 
request the Grantee to prepare any amendments required to meet current 
policy guidance.
    (4) The Grantee shall ensure that the approved administrative plan 
is incorporated into the State emergency plan.
    (c) Audit--(1) Nonfederal audit. For grantees or subgrantees, 
requirements for nonfederal audit are contained in FEMA regulations at 
44 CFR Part 14 or OMB Circular A-110 as appropriate.
    (2) Federal audit. In accordance with 44 CFR part 14, Appendix A, 
Para. 10, FEMA may elect to conduct a Federal

[[Page 474]]

audit of the disaster assistance grant or any of the subgrants.

[55 FR 2304, Jan. 23, 1990; 55 FR 5458, Feb. 15, 1990]



Sec. 206.208  Direct Federal assistance.

    (a) General. When the State and local government lack the capability 
to perform or to contract for eligible emergency work and/or debris 
removal, under sections 402(4), 403 or 407 of the Act, the Grantee may 
request that the work be accomplished by a Federal agency. Such 
assistance is subject to the cost sharing provisions outlined in 
Sec. 206.203(b) of this subpart. Direct Federal assistance is also 
subject to the eligibility criteria contained in Subpart H of these 
regulations. FEMA will reimburse other Federal agencies in accordance 
with Subpart A of these regulations.
    (b) Requests for assistance. All requests for direct Federal 
assistance shall be submitted by the Grantee to the RD and shall 
include:
    (1) A written agreement that the State will:
    (i) Provide without cost to the United States all lands, easements 
and rights-of-ways necessary to accomplish the approved work;
    (ii) Hold and save the United States free from damages due to the 
requested work, and shall indemnify the Federal Government against any 
claims arising from such work;
    (iii) Provide reimbursement to FEMA for the nonfederal share of the 
cost of such work in accordance with the provisions of the FEMA-State 
Agreement; and
    (iv) Assist the performing Federal agency in all support and local 
jurisdictional matters.
    (2) A statement as to the reasons the State and the local government 
cannot perform or contract for performance of the requested work.
    (3) A written agreement from an eligible applicant that such 
applicant will be responsible for the items in subparagraph (b)(1) (i) 
and (ii) of this section, in the event that a State is legally unable to 
provide the written agreement.
    (c) Implementation. (1) If the RD approves the request, a mission 
assignment will be issued to the appropriate Federal agency. The mission 
assignment letter to the agency shall define the scope of eligible work. 
Prior to execution of work on any project, the RD shall prepare a DSR 
establishing the scope and estimated cost of eligible work. The Federal 
agency shall not exceed the approved funding limit without the 
authorization of the RD.
    (2) If all or any part of the requested work falls within the 
statutory authority of another Federal agency, the RD shall not approve 
that portion of the work. In such case, the unapproved portion of the 
request will be referred to the appropriate agency for action.
    (d) Time limitation. The time limitation for completion of work by a 
Federal agency under a mission assignment is 60 days after the 
President's declaration. Based on extenuating circumstances or unusual 
project requirements, the RD may extend this time limitation.
    (e) Project management. (1) The performing Federal agency shall 
ensure that the work is completed in accordance with the RD's approved 
scope of work, costs and time limitations. The performing Federal agency 
shall also keep the RD and Grantee advised of work progress and other 
project developments. It is the responsibility of the performing Federal 
agency to ensure compliance with applicable Federal, State and local 
legal requirements. A final inspection report will be completed upon 
termination of all direct Federal assistance work. Final inspection 
reports shall be signed by a representative of the performing Federal 
agency and the State. Once the final eligible cost is determined 
(including Federal agency overhead), the State will be billed for the 
nonfederal share of the mission assignment in accordance with the cost 
sharing provisions of the FEMA-State Agreement.
    (2) Pursuant to the agreements provided in the request for 
assistance the Grantee shall assist the performing Federal agency in all 
State and local jurisdictional matters. These matters include securing 
local building permits and rights of entry, control of traffic and 
pedestrians, and compliance with local building ordinances.

[[Page 475]]



Secs. 206.209-206.219  [Reserved]



                Subpart H--Public Assistance Eligibility

    Source: 55 FR 2307, Jan. 23, 1990, unless otherwise noted.



Sec. 206.220  General.

    This subpart provides policies and procedures for determinations of 
eligibility of applicants for public assistance, eligibility of work, 
and eligibility of costs for assistance under sections 402, 403, 406, 
407, 418, 419, 421(d), 502 and 503 of the Stafford Act. Assistance under 
this subpart must also conform to requirements of 44 CFR part 206, 
subparts G--Public Assistance Project Administration, I--Public 
Assistance Insurance Requirements, J--Coastal Barrier Resources Act, and 
M--Hazard Mitigation Planning. Regulations under 44 CFR part 9--
Floodplain Management and 44 CFR part 10--Environmental Considerations, 
also apply to this assistance.



Sec. 206.221  Definitions.

    (a) Educational institution means:
    (1) Any elementary school as defined by section 801(c) of the 
Elementary and Secondary Education Act of 1965; or
    (2) Any secondary school as defined by section 801(h) of the 
Elementary and Secondary Education Act of 1965; or
    (3) Any institution of higher education as defined by section 1201 
of the Higher Education Act of 1965.
    (b) Force account means an applicant's own labor forces and 
equipment.
    (c) Immediate threat means the threat of additional damage or 
destruction from an event which can reasonably be expected to occur 
within five years.
    (d) Improved property means a structure, facility or item of 
equipment which was built, constructed or manufactured. Land used for 
agricultural purposes is not improved property.
    (e) Private nonprofit facility means any private nonprofit 
educational, utility, emergency, medical, or custodial care facility, 
including a facility for the aged or disabled, and other facility 
providing essential governmental type services to the general public, 
and such facilities on Indian reservations. Further definition is as 
follows:
    (1) Educational facilities means classrooms plus related supplies, 
equipment, machinery, and utilities of an educational institution 
necessary or appropriate for instructional, administrative, and support 
purposes, but does not include buildings, structures and related items 
used primarily for religious purposes or instruction.
    (2) Utility means buildings, structures, or systems of energy, 
communication, water supply, sewage collection and treatment, or other 
similar public service facilities.
    (3) Emergency facility means those buildings, structures, equipment, 
or systems used to provide emergency services, such as fire protection, 
ambulance, or rescue, to the general public, including the 
administrative and support facilities essential to the operation of such 
emergency facilities even if not contiguous.
    (4) Medical facility means any hospital, outpatient facility, 
rehabilitation facility, or facility for long term care as such terms 
are defined in section 645 of the Public Health Service Act (42 U.S.C. 
2910) and any similar facility offering diagnosis or treatment of mental 
or physical injury or disease, includng the administrative and support 
facilities essential to the operation of such medical facilities even if 
not contiguous.
    (5) Custodial care facility means those buildings, structures, or 
systems including those for essential administration and support, which 
are used to provide institutional care for persons who require close 
supervision and some physical constraints on their daily activities for 
their self-protection, but do not require day-to-day medical care.
    (6) Other essential governmental service facility means museums, 
zoos, community centers, libraries, homeless shelters, senior citizen 
centers, rehabilitation facilities, shelter workshops and facilities 
which provide health and safety services of a governmental nature. All 
such facilities must be open to the general public.
    (f) Private nonprofit organization means any nongovernmental agency 
or entity that currently has:

[[Page 476]]

    (1) An effective ruling letter from the U.S. Internal Revenue 
Service, granting tax exemption under sections 501(c), (d), or (e) of 
the Internal Revenue Code of 1954, or
    (2) Satisfactory evidence from the State that the nonrevenue 
producing organization or entity is a nonprofit one organized or doing 
business under State law.
    (g) Public entity means an organization formed for a public purpose 
whose direction and funding are provided by one or more political 
subdivisions of the State.
    (h) Public facility means the following facilities owned by a State 
or local government: any flood control, navigation, irrigation, 
reclamation, public power, sewage treatment and collection, water supply 
and distribution, watershed development, or airport facility; any non-
Federal aid, street, road, or highway; and any other public building, 
structure, or system, including those used for educational, 
recreational, or cultural purposes; or any park.
    (i) Standards means codes, specifications or standards required for 
the construction of facilities.

[55 FR 2307, Jan. 23, 1990, as amended at 58 FR 47994, Sept. 14, 1993]



Sec. 206.222  Applicant eligibility.

    The following entities are eligible to apply for assistance under 
the State public assistance grant:
    (a) State and local governments.
    (b) Private non-profit organizations or institutions which own or 
operate a private nonprofit facility as defined in Sec. 205.221(e).
    (c) Indian tribes or authorized tribal organizations and Alaska 
Native villages or organizations, but not Alaska Native Corporations, 
the ownership of which is vested in private individuals.



Sec. 206.223  General work eligibility.

    (a) General. To be eligible for financial assistance, an item of 
work must:
    (1) Be required as the result of the major disaster event,
    (2) Be located within a designated disaster area, and
    (3) Be the legal responsibility of an eligible applicant.
    (b) Private nonprofit facilities. To be eligible, all private 
nonprofit facilities must be owned and operated by an organization 
meeting the definition of a private nonprofit organization [see 
Sec. 206.221(f)].
    (c) Public entities. Facilities belonging to a public entity may be 
eligible for assistance when the application is submitted through the 
State or a political subdivision of the State.
    (d) Facilities serving a rural community or unincorporated town or 
village. To be eligible for assistance, a facility not owned by an 
eligible applicant, as defined in Sec. 206.222, must be owned by a 
private nonprofit organization; and provide an essential governmental 
service to the general public. Applications for these facilities must be 
submitted through a State or political subdivision of the State.
    (e) Negligence. No assistance will be provided to an applicant for 
damages caused by its own negligence. If negligence by another party 
results in damages, assistance may be provided, but will be conditioned 
on agreement by the applicant to cooperate with FEMA in all efforts 
necessary to recover the cost of such assistance from the negligent 
party.



Sec. 206.224  Debris removal.

    (a) Public interest. Upon determination that debris removal is in 
the public interest, the Regional Director may provide assistance for 
the removal of debris and wreckage from publicly and privately owned 
lands and waters. Such removal is in the public interest when it is 
necessary to:
    (1) Eliminate immediate threats to life, public health, and safety; 
or
    (2) Eliminate immediate threats of significant damage to improved 
public or private property; or
    (3) Ensure economic recovery of the affected community to the 
benefit of the community-at-large.
    (b) Debris removal from private property. When it is in the public 
interest for an eligible applicant to remove debris from private 
property in urban, suburban and rural areas, including large lots, 
clearance of the living, recreational and working area is eligible 
except those areas used for crops and livestock or unused areas.

[[Page 477]]

    (c) Assistance to individuals and private organizations. No 
assistance will be provided directly to an individual or private 
organization, or to an eligible applicant for reimbursement of an 
individual or private organization, for the cost of removing debris from 
their own property. Exceptions to this are those private nonprofit 
organizations operating eligible facilities.



Sec. 206.225  Emergency work.

    (a) General. (1) Emergency protective measures to save lives, to 
protect public health and safety, and to protect improved property are 
eligible.
    (2) In determining whether emergency work is required, the Regional 
Director may require certification by local State, and/or Federal 
officials that a threat exists, including identification and evaluation 
of the threat and recommendations of the emergency work necessary to 
cope with the threat.
    (3) In order to be eligible, emergency protective measures must:
    (i) Eliminate or lessen immediate threats to live, public health or 
safety; or
    (ii) Eliminate or lessen immediate threats of significant additional 
damage to improved public or private property through measures which are 
cost effective.
    (b) Emergency access. An access facility that is not publicly owned 
or is not the direct responsibility of an eligible applicant for repair 
or maintenance may be eligible for emergency repairs or replacement 
provided that emergency repair or replacement of the facility 
economically eliminates the need for temporary housing. The work will be 
limited to that necessary for the access to remain passable through 
events which can be considered an immediate threat. The work must be 
performed by an eligible applicant and will be subject to cost sharing 
requirements.
    (c) Emergency communications. Emergency communications necessary for 
the purpose of carrying out disaster relief functions may be established 
and may be made available to State and local government officials as 
deemed appropriate. Such communications are intended to supplement but 
not replace normal communications that remain operable after a major 
disaster. FEMA funding for such communications will be discontinued as 
soon as the needs have been met.
    (d) Emergency public transportation. Emergency public transportation 
to meet emergency needs and to provide transportation to public places 
and such other places as necessary for the community to resume its 
normal pattern of life as soon as possible is eligible. Such 
transportation is intended to supplement but not replace predisaster 
transportation facilities that remain operable after a major disaster. 
FEMA funding for such transportation will be discontinued as soon as the 
needs have been met.



Sec. 206.226  Restoration of damaged facilities.

    Work to restore eligible facilities on the basis of the design of 
such facilities as they existed immediately prior to the disaster and in 
conformity with the following is eligible:
    (a) Assistance under other Federal agency (OFA) programs. (1) 
Generally, disaster assistance will not be made available under the 
Stafford Act when another Federal agency has specific authority to 
restore facilities damaged or destroyed by an event which is declared a 
major disaster.
    (2) An exception to the policy described in paragraph (a)(1) of this 
section exists for public elementary and secondary school facilities 
which are otherwise eligible for assistance from the Department of 
Education (ED) under 20 U.S.C. 241-1 and 20 U.S.C. 646. Such facilities 
are also eligible for assistance from FEMA under the Stafford Act, and 
grantees shall accept applications from local educational agencies for 
assistance under the Stafford Act.
    (3) The exception does not cover payment of increased current 
operating expenses or replacement of lost revenues as provided in 20 
U.S.C. 241-1(a) and implemented by 34 CFR 219.14. Such assistance shall 
continue to be granted and administered by the Department of Education.
    (b) Standards. For the costs of Federal, State, and local repair or 
replacement standards which change the

[[Page 478]]

predisaster construction of facility to be eligible, the standards must:
    (1) Apply to the type of repair or restoration required;

(Standards may be different for new construction and repair work)
    (2) Be appropriate to the predisaster use of the facility;
    (3) Be in writing and formally adopted by the applicant prior to 
project approval or be a legal Federal or State requirement applicable 
to the type of restoration;
    (4) Apply uniformly to all similar types of facilities within the 
jurisdiction of owner of the facility; and
    (5) For any standard in effect at the time of a disaster, it must 
have been enforced during the time it was in effect.
    (c) Hazard mitigation. In approving grant assistance for restoration 
of facilities, the Regional Director may require cost effective hazard 
mitigation measures not required by applicable standards. The cost of 
any requirements for hazard mitigation placed on restoration projects by 
FEMA will be an eligible cost for FEMA assistance.
    (d) Repair vs. replacement. (1) A facility is considered repairable 
when disaster damages do not exceed 50 percent of the cost of replacing 
a facility to its predisaster condition, and it is feasible to repair 
the facility so that it can perform the function for which it was being 
used as well as it did immediately prior to the disaster.
    (2) If a damaged facility is not repairable in accordance with 
paragraph (d)(1) of this section, approved restorative work may include 
replacement of the facility. The applicant may elect to perform repairs 
to the facility, in lieu of replacement, if such work is in conformity 
with applicable standards. However, eligible costs shall be limited to 
the less expensive of repairs or replacement.
    (3) An exception to the limitation in paragraph (d)(2) of this 
section may be allowed for facilities eligible for or on the National 
Register of Historic Properties. If an applicable standard requires 
repair in a certain manner, costs associated with that standard will be 
eligible.
    (e) Relocation. (1) The Regional Director may approve funding for 
and require restoration of a destroyed facility at a new location when:
    (i) The facility is and will be subject to repetitive heavy damage;
    (ii) The approval is not barred by other provisions of title 44 CFR; 
and
    (iii) The overall project, including all costs, is cost effective.
    (2) When relocation is required by the Regional Director, eligible 
work includes land acquisition and ancillary facilities such as roads 
and utilities, in addition to work normally eligible as part of a 
facility reconstruction. Demolition and removal of the old facility is 
also an eligible cost.
    (3) When relocation is required by the Regional Director, no future 
funding for repair or replacement of a facility at the original site 
will be approved, except those facilities which facilitate an open space 
use in accordance with 44 CFR part 9.
    (4) When relocation is required by the Regional Director, and, 
instead of relocation, the applicant requests approval of an alternate 
project [see Sec. 206.203(d)(2)], eligible costs will be limited to 90 
percent of the estimate of restoration at the original location 
excluding hazard mitigation measures.
    (5) If relocation of a facility is not feasible or cost effective, 
the Regional Director shall disapprove Federal funding for the original 
location when he/she determines in accordance with 44 CFR part 9, 44 CFR 
part 10, or 44 CFR part 206, subpart M, that restoration in the original 
location is not allowed. In such cases, an alternate project may be 
applied for.
    (f) Equipment and furnishings. If equipment and furnishings are 
damaged beyond repair, comparable items are eligible as replacement 
items.
    (g) Library books and publications. Replacement of library books and 
publications is based on an inventory of the quantities of various 
categories of books or publications damaged or destroyed. Cataloging and 
other work incidental to replacement are eligible.
    (h) Beaches. (1) Replacement of sand on an unimproved natural beach 
is not eligible.
    (2) Improved beaches. Work on an improved beach may be eligible 
under the following conditions:

[[Page 479]]

    (i) The beach was constructed by the placement of sand (of proper 
grain size) to a designed elevation, width, and slope; and
    (ii) A maintenance program involving periodic renourishment of sand 
must have been established and adhered to by the applicant.
    (i) Restrictions--(1) Alternative use facilities. If a facility was 
being used for purposes other than those for which it was designed, 
restoration will only be eligible to the extent necessary to restore the 
immediate predisaster alternate purpose.
    (2) Inactive facilities. Facilities that were not in active use at 
the time of the disaster are not eligible except in those instances 
where the facilities were only temporarily inoperative for repairs or 
remodeling, or where active use by the applicant was firmly established 
in an approved budget or the owner can demonstrate to FEMA's 
satisfaction an intent to begin use within a reasonable time.

[55 FR 2307, Jan. 23, 1990, as amended at 58 FR 55022, Oct. 25, 1993]



Sec. 206.227  Snow assistance.

    Emergency or major disaster declarations based on snow or blizzard 
conditions will be made only for cases of record or near record 
snowstorms, as established by official government records. Federal 
assistance will be provided for all costs eligible under 44 CFR 206.225 
for a specified period of time which will be determined by the 
circumstances of the event.

[62 FR 45330, Aug. 27, 1997]



Sec. 206.228  Allowable costs.

    General policies for determining allowable costs are established in 
44 CFR 13.22. Exceptions to those policies as allowed in 44 CFR 13.4 and 
13.6 are explained below.
    (a) Eligible direct costs--(1) Applicant-owned equipment. 
Reimbursement for ownership and operation costs of applicant-owned 
equipment used to perform eligible work shall be provided in accordance 
with the following guidelines:
    (i) Rates established under State guidelines. In those cases where 
an applicant uses reasonable rates which have been established or 
approved under State guidelines, in its normal daily operations, 
reimbursement for applicant-owned equipment which has an hourly rate of 
$75 or less shall be based on such rates. Reimbursement for equipment 
which has an hourly rate in excess of $75 shall be determined on a case 
by case basis by FEMA.
    (ii) Rates established under local guidelines. Where local 
guidelines are used to establish equipment rates, reimbursement will be 
based on those rates or rates in a Schedule of Equipment Rates published 
by FEMA, whichever is lower. If an applicant certifies that its locally 
established rates do not reflect actual costs, reimbursement may be 
based on the FEMA Schedule of Equipment Rates, but the applicant will be 
expected to provide documentation if requested. If an applicant wishes 
to claim an equipment rate which exceeds the FEMA Schedule, it must 
document the basis for that rate and obtain FEMA approval of an 
alternate rate.
    (iii) No established rates. The FEMA Schedule of Equipment Rates 
will be the basis for reimbursement in all cases where an applicant does 
not have established equipment rates.
    (2) Statutory Administrative Costs--(i) Grantee. Pursuant to section 
406(f)(2) of the Stafford Act, an allowance will be provided to the 
State to cover the extraordinary costs incurred by the State for 
preparation of damage survey reports, final inspection reports, project 
applications, final audits, and related field inspections by State 
employees, including overtime pay and per diem and travel expenses, but 
not including regular time for such employees. The allowance will be 
based on the following percentages of the total amount of assistance 
provided (Federal share) for all subgrantees in the State under sections 
403, 406, 407, 502, and 503 of the Act:
    (A) For the first $100,000 of total assistance provided (Federal 
share), three percent of such assistance.
    (B) For the next $900,000, two percent of such assistance.
    (C) For the next $4,000,000, one percent of such assistance.
    (D) For assistance over $5,000,000, one-half percent of such 
assistance.
    (ii) Subgrantee. Pursuant to section 406(f)(1) of the Stafford Act, 
necessary

[[Page 480]]

costs of requesting, obtaining, and administering Federal disaster 
assistance subgrants will be covered by an allowance which is based on 
the following percentages of net eligible costs under sections 403, 406, 
407, 502, and 503 of the Act, for an individual applicant (applicants in 
this context include State agencies):
    (A) For the first $100,000 of net eligible costs, three percent of 
such costs;
    (B) For the next $900,000, two percent of such costs;
    (C) For the next $4,000,000, one percent of such costs;
    (D) For those costs over $5,000,000, one-half percent of such costs.
    (3) State Management Administrative Costs.
    (i) Grantee. Except for the items listed in paragraph (a)(2)(i) of 
this section, other administrative costs shall be paid in accordance 
with 44 CFR 13.22.
    (ii) Subgrantee. No other administrative costs of a subgrantee are 
eligible because the percentage allowance in paragraph (a)(2)(ii) of 
this section covers necessary costs of requesting, obtaining and 
administering Federal assistance.
    (4) Force Account Labor Costs. The straight- or regular-time 
salaries and benefits of a subgrantee's permanently employed personnel 
are not eligible in calculating the cost of eligible work under sections 
403 and 407 of the Stafford Act, 42 U.S.C. 5170b and 5173. For the 
performance of eligible permanent restoration under section 406 of the 
Act, 42 U.S.C. 5172, straight-time salaries and benefits of a 
subgrantee's permanently employed personnel are eligible.
    (b) Eligible indirect costs--(1) Grantee. Indirect costs of 
administering the disaster program are eligible in accordance with the 
provisions of 44 CFR part 13 and OMB Circular A-87.
    (2) Subgrantee. No indirect costs of a subgrantee are separately 
eligible because the percentage allowance in paragraph (a)(2)(ii) of 
this section covers necessary costs of requesting, obtaining and 
administering Federal assistance.

[55 FR 2307, Jan. 23, 1990, as amended at 58 FR 47996, Sept. 14, 1993]



Secs. 206.229-206.249  [Reserved]



           Subpart I--Public Assistance Insurance Requirements

    Source: 56 FR 64560, Dec. 11, 1991, unless otherwise noted.



Sec. 206.250  General.

    (a) Sections 311 and 406(d) of the Stafford Act, and the Flood 
Disaster Protection Act of 1973, Public Law 93-234, set forth certain 
insurance requirements which apply to disaster assistance provided by 
FEMA. The requirements of this subpart apply to all assistance provided 
pursuant to section 406 of the Stafford Act with respect to any major 
disaster declared by the President after November 23, 1988.
    (b) Insurance requirements prescribed in this subpart shall apply 
equally to private nonprofit (PNP) facilities which receive assistance 
under section 406 of the Act. PNP organizations shall submit the 
necessary documentation and assurances required by this subpart to the 
Grantee.
    (c) Actual and anticipated insurance recoveries shall be deducted 
from otherwise eligible costs, in accordance with this subpart.
    (d) The full coverage available under the standard flood insurance 
policy from the National Flood Insurance Program (NFIP) will be 
subtracted from otherwise eligible costs for a building and its contents 
within the special flood hazard area in accordance with Sec. 206.252.
    (e) The insurance requirements of this subpart should not be 
interpreted as a substitute for various hazard mitigation techniques 
which may be available to reduce the incidence and severity of future 
damage.



Sec. 206.251  Definitions.

    (a) Assistance means any form of a Federal grant under section 406 
of the Stafford Act to replace, restore, repair, reconstruct, or 
construct any facility and/or its contents as a result of a major 
disaster.
    (b) Building means a walled and roofed structure, other than a gas, 
or liquid storage tank, that is principally

[[Page 481]]

above ground and affixed to a permanent site, as well as a manufactured 
home on a permanent foundation.
    (c) Community means any State or political subdivision thereof, or 
any Indian tribe or authorized tribal organization, or Alaskan Native 
Village or authorized native organization which has authority to adopt 
and enforce floodplain management regulations for the areas within its 
jurisdiction.
    (d) National Flood Insurance Program (NFIP) means the program 
authorized by the National Flood Insurance Act of 1968, as amended, 42 
U.S.C. 4001 et seq.
    (e) Special flood hazard area means an area having special flood, 
mudslide, and/or flood-related erosion hazards, and shown on a Flood 
Hazard Boundary map (FHBM) or the Flood Insurance Rate Map (FIRM) issued 
by FEMA as Zone A, AO, A1-30, AE, A99, AH, VO, V1-30 VE, V, M, or E. 
``Special flood hazard area'' is synonymous with ``special hazard 
area'', as defined in 44 CFR part 59.
    (f) Standard Flood Insurance Policy means the flood insurance policy 
issued by the Federal Insurance Administrator, or by a Write-Your-Own 
Company pursuant to 44 CFR 62.23.



Sec. 206.252  Insurance requirements for facilities damaged by flood.

    (a) Where an insurable building damaged by flooding is located in a 
special flood hazard area identified for more than one year by the 
Director, assistance pursuant to section 406 of the Stafford Act shall 
be reduced. The amount of the reduction shall be the maximum amount of 
the insurance proceeds which would have been received had the building 
and its contents been fully covered by a standard flood insurance 
policy.
    (b) The reduction stated above shall not apply to a PNP facility 
which could not be insured because it was located in a community not 
participating in the NFIP. However, the provisions of the Flood Disaster 
Protection Act of 1973 prohibit approval of assistance for the PNP 
unless the community agrees to participate in the NFIP within six months 
after the major disaster declaration date, and the required flood 
insurance is purchased.
    (c) Prior to approval of a Federal grant for the restoration of a 
facility and its contents which were damaged by a flood, the Grantee 
shall notify the Regional Director of any entitlement to an insurance 
settlement or recovery. The Regional Director shall reduce the eligible 
costs by the amount of insurance proceeds which the grantee receives.
    (d) The grantee or subgrantee is required to obtain and maintain 
flood insurance in the amount of eligible disaster assistance, as a 
condition of receiving Federal assistance that may be available. This 
requirement also applies to insurable flood damaged facilities located 
outside a special flood hazard area when it is reasonably available, 
adequate, and necessary. However, the Regional Director shall not 
require greater types and amounts of insurance than are certified as 
reasonable by the State Insurance Commissioner. The requirement to 
purchase flood insurance is waived when eligible costs for an insurable 
facility do not exceed $5,000.



Sec. 206.253  Insurance requirements for facilities damaged by disasters other than flood.

    (a) Prior to approval of a Federal grant for the restoration of a 
facility and its contents which were damaged by a disaster other than 
flood, the Grantee shall notify the Regional Director of any entitlement 
to insurance settlement or recovery for such facility and its contents. 
The Regional Director shall reduce the eligible costs by the actual 
amount of insurance proceeds relating to the eligible costs.
    (b)(1) Assistance under section 406 of the Stafford Act will be 
approved only on the condition that the grantee obtain and maintain such 
types and amounts of insurance as are reasonable and necessary to 
protect against future loss to such property from the types of hazard 
which caused the major disaster. The extent of insurance to be required 
will be based on the eligible damage that was incurred to the damaged 
facility as a result of the major disaster. The Regional Director shall 
not require greater types and extent of

[[Page 482]]

insurance than are certified as reasonable by the State Insurance 
Commissioner.
    (2) Due to the high cost of insurance, some applicants may request 
to insure the damaged facilities under a blanket insurance policy 
covering all their facilities, an insurance pool arrangement, or some 
combination of these options. Such an arrangement may be accepted for 
other than flood damages. However, if the same facility is damaged in a 
similar future disaster, eligible costs will be reduced by the amount of 
eligible damage sustained on the previous disaster.
    (c) The Regional Director shall notify the Grantee of the type and 
amount of insurance required. The grantee may request that the State 
Insurance Commissioner review the type and extent of insurance required 
to protect against future loss to a disaster-damaged facility, the 
Regional Director shall not require greater types and extent of 
insurance than are certified as reasonable by the State Insurance 
Commissioner.
    (d) The requirements of section 311 of the Stafford Act are waived 
when eligible costs for an insurable facility do not exceed $5,000. The 
Regional Director may establish a higher waiver amount based on hazard 
mitigation initiatives which reduce the risk of future damages by a 
disaster similar to the one which resulted in the major disaster 
declaration which is the basis for the application for disaster 
assistance.
    (e) The Grantee shall provide assurances that the required insurance 
coverage will be maintained for the anticipated life of the restorative 
work or the insured facility, whichever is the lesser.
    (f) No assistance shall be provided under section 406 of the 
Stafford Act for any facility for which assistance was provided as a 
result of a previous major disaster unless all insurance required by 
FEMA as a condition of the previous assistance has been obtained and 
maintained.



Secs. 206.254-206.339  [Reserved]



                Subpart J--Coastal Barrier Resources Act

    Source: 55 FR 2311, Jan. 23, 1990, unless otherwise noted.



Sec. 206.340  Purpose of subpart.

    This subpart implements the Coastal Barrier Resources Act (CBRA) 
(Pub. L. 97-348) as that statute applies to disaster relief granted to 
individuals and State and local governments under the Stafford Act. CBRA 
prohibits new expenditures and new financial assistance within the 
Coastal Barrier Resources System (CBRS) for all but a few types of 
activities identified in CBRA. This subpart specifies what actions may 
and may not be carried out within the CBRS. It establishes procedures 
for compliance with CBRA in the administration of disaster assistance by 
FEMA.



Sec. 206.341  Policy.

    It shall be the policy of FEMA to achieve the goals of CBRA in 
carrying out disaster relief on units of the Coastal Barrier Resources 
System. It is FEMA's intent that such actions be consistent with the 
purpose of CBRA to minimize the loss of human life, the wasteful 
expenditure of Federal revenues, and the damage to fish, wildlife and 
other natural resources associated with coastal barriers along the 
Atlantic and Gulf coasts and to consider the means and measures by which 
the long-term conservation of these fish, wildlife, and other natural 
resources may be achieved under the Stafford Act.



Sec. 206.342  Definitions.

    Except as otherwise provided in this subpart, the definitions set 
forth in part 206 of subchapter D are applicable to this subject.
    (a) Consultation means that process by which FEMA informs the 
Secretary of the Interior through his/her designated agent of FEMA 
proposed disaster assistance actions on a designated

[[Page 483]]

unit of the Coastal Barrier Resources System and by which the Secretary 
makes comments to FEMA about the appropriateness of that action. 
Approval by the Secretary is not required in order that an action be 
carried out.
    (b) Essential link means that portion of a road, utility, or other 
facility originating outside of the system unit but providing access or 
service through the unit and for which no alternative route is 
reasonably available.
    (c) Existing facility on a unit of CBRS established by Public Law 
97-348 means a publicly owned or operated facility on which the start of 
a construction took place prior to October 18, 1982, and for which this 
fact can be adequately documented. In addition, a legally valid building 
permit or equivalent documentation, if required, must have been obtained 
for the construction prior to October 18, 1982. If a facility has been 
substantially improved or expanded since October 18, 1982, it is not an 
existing facility. For any other unit added to the CBRS by amendment to 
Public Law 97-348, the enactment date of such amendment is substituted 
for October 18, 1982, in this definition.
    (d) Expansion means changing a facility to increase its capacity or 
size.
    (e) Facility means ``public facility'' as defined in Sec. 206.201. 
This includes any publicly owned flood control, navigation, irrigation, 
reclamation, public power, sewage treatment and collection, water supply 
and distribution, watershed development, or airport facility; and 
nonfederal-aid street, road, or highway; and any other public building, 
structure, or system, including those used for educational, 
recreational, or cultural purposes, or any park.
    (f) Financial assistance means any form of Federal loan, grant 
guaranty, insurance, payment rebate, subsidy or any other form of direct 
or indirect Federal assistance.
    (g) New financial assistance on a unit of the CBRS established by 
Public Law 97-348 means an approval by FEMA of a project application or 
other disaster assistance after October 18, 1982. For any other unit 
added to the CBRS by amendment to Public Law 97-348, the enactment date 
such amendment is substituted for October 18, 1982, in this definition.
    (h) Start of construction for a structure means the first placement 
of permanent construction, such as the placement of footings or slabs or 
any work beyond the stage of excavation. Permanent construction for a 
structure does not include land preparation such as clearing, grading, 
and placement of fill, nor does it include excavation for a basement, 
footings, or piers. For a facility which is not a structure, start of 
construction means the first activity for permanent construction of a 
substantial part of the facility. Permanent construction for a facility 
does not include land preparation such as clearing and grubbing but 
would include excavation and placement of fill such as for a road.
    (i) Structure means a walled and roofed building, including a gas or 
liquid storage tank, that is principally above ground, as well as a 
mobile home.
    (j) Substantial improvement means any repair, reconstruction or 
other improvement of a structure or facility, that has been damaged in 
excess of, or the cost of which equals or exceeds, 50 percent of the 
market value of the structure or placement cost of the facility 
(including all ``public facilities'') as defined in the Stafford Act) 
either:
    (1) Before the repair or improvement is started; or
    (2) If the structure or facility has been damaged and is proposed to 
be restored, before the damage occurred. If a facility is a link in a 
larger system, the percentage of damage will be based on the relative 
cost of repairing the damaged facility to the replacement cost of that 
portion of the system which is operationally dependent on the facility. 
The term substantial improvement does not include any alternation of a 
structure or facility listed on the National Register of Historic Places 
or a State Inventory of Historic Places.
    (k) System unit means any undeveloped coastal barrier, or 
combination of closely related undeveloped coastal barriers included 
within the Coastal Barrier Resources System as established by the 
section 4 of the CBRA, or as modified by the Secretary in accordance 
with that statute.

[[Page 484]]



Sec. 206.343  Scope.

    (a) The limitations on disaster assistance as set forth in this 
subpart apply only to FEMA actions taken on a unit of the Coastal 
Barrier Resources System or any conduit to such unit, including, but not 
limited to a bridge, causeway, utility, or similar facility.
    (b) FEMA assistance having a social program orientation which is 
unrelated to development is not subject to the requirements of these 
regulations. This assistance includes:
    (1) Individual and Family Grants that are not for acquisition or 
construction purposes;
    (2) Crisis counseling;
    (3) Disaster Legal services; and
    (4) Disaster unemployment assistance.



Sec. 206.344  Limitations on Federal expenditures.

    Except as provided in Secs. 206.345 and 206.346, no new expenditures 
or financial assistance may be made available under authority of the 
Stafford Act for any purpose within the Coastal Barrier Resources 
System, including but not limited to:
    (a) Construction, reconstruction, replacement, repair or purchase of 
any structure, appurtenance, facility or related infrastructure;
    (b) Construction, reconstruction, replacement, repair or purchase of 
any road, airport, boat landing facility, or other facility on, or 
bridge or causeway to, any System unit; and
    (c) Carrying out of any project to prevent the erosion of, or to 
otherwise stabilize, any inlet, shoreline, or inshore area, except that 
such assistance and expenditures may be made available on units 
designated pursuant to Section 4 on maps numbered S01 through S08 for 
purposes other than encouraging development and, in all units, in cases 
where an emergency threatens life, land, and property immediately 
adjacent to that unit.



Sec. 206.345  Exceptions.

    The following types of disaster assistance actions are exceptions to 
the prohibitions of Sec. 206.344.
    (a) After consultation with the Secretary of the Interior, the FEMA 
Regional Director may make disaster assistance available within the CBRS 
for:
    (1) Replacement, reconstruction, or repair, but not the expansion, 
of publicly owned or publicly operated roads, structures, or facilities 
that are essential links in a larger network or system;
    (2) Repair of any facility necessary for the exploration, 
extraction, or transportation of energy resources which activity can be 
carried out only on, in, or adjacent to coastal water areas because the 
use or facility requires access to the coastal water body; and
    (3) Restoration of existing channel improvements and related 
structures, such as jetties, and including the disposal of dredge 
materials related to such improvements.
    (b) After consultation with the Secretary of the Interior, the FEMA 
Regional Director may make disaster assistance available within the CBRS 
for the following types of actions, provided such assistance is 
consistent with the purposes of CBRA;
    (1) Emergency actions essential to the saving of lives and the 
protection of property and the public health and safety, if such actions 
are performed pursuant to sections 402, 403, and 502 of the Stafford Act 
and are limited to actions that are necessary to alleviate the impacts 
of the event;
    (2) Replacement, reconstruction, or repair, but not the expansion, 
of publicly owned or publicly operated roads, structures, or facilities, 
except as provided in Sec. 206.347(c)(5);
    (3) Repair of air and water navigation aids and devices, and of the 
access thereto;
    (4) Repair of facilities for scientific research, including but not 
limited to aeronautical, atmospheric, space, geologic, marine, fish and 
wildlife and other research, development, and applications;
    (5) Repair of facilities for the study, management, protection and 
enhancement of fish and wildlife resources and habitats, including but 
not limited to, acquisition of fish and wildlife habitats and related 
lands, stabilization projects for fish and wildlife habitats, and 
recreational projects; and

[[Page 485]]

    (6) Repair of nonstructural proejcts for shoreline stabilization 
that are designed to mimic, enhance, or restore natural stabilization 
systems.



Sec. 206.346  Applicability to disaster assistance.

    (a) Emergency assistance. The Regional Director may approve 
assistance pursuant to sections 402, 403, or 502 of the Stafford Act, 
for emergency actions which are essential to the saving of lives and the 
protection of property and the public health and safety, are necessary 
to alleviate the emergency, and are in the public interest. Such actions 
include but are not limited to:
    (1) Removal of debris from public property;
    (2) Emergency protection measures to prevent loss of life, prevent 
damage to improved property and protect public health and safety;
    (3) Emergency restoration of essential community services such as 
electricity, water or sewer;
    (4) Provision of access to a private residence;
    (5) Provision of emergency shelter by means of providing emergency 
repair of utilities, provision of heat in the season requiring heat, or 
provision of minimal cooking facilities;
    (6) Relocation of individuals or property out of danger, such as 
moving a mobile home to an area outside of the CBRS (but disaster 
assistance funds may not be used to relocate facilities back into the 
CBRS);
    (7) Home repairs to private owner-occupied primary residences to 
make them habitable;
    (8) Housing eligible families in existing resources in the CBRS; and
    (9) Mortgage and rental payment assistance.
    (b) Permanent restoration assistance. Subject to the limitations set 
out below, the Regional Director may approve assistance for the repair, 
reconstruction, or replacement but not the expansion of the following 
publicly owned or operated facilities and certain private nonprofit 
facilities.
    (1) Roads and bridges;
    (2) Drainage structures, dams, levees;
    (3) Buildings and equipment;
    (4) Utilities (gas, electricity, water, etc.); and
    (5) Park and recreational facilities.



Sec. 206.347  Requirements.

    (a) Location determination. For each disaster assistance action 
which is proposed on the Atlantic or Gulf Coasts, the Regional Director 
shall:
    (1) Review a proposed action's location to determine if the action 
is on or connected to the CBRS unit and thereby subject to these 
regulations. The appropriate Department of Interior map identifying 
units of the CBRS will be the basis of such determination. The CBRS 
units are also identified on FEMA Flood Insurance Maps (FIRM's) for the 
convenience of field personnel.
    (2) If an action is determined not to be on or connected to a unit 
of the CBRS, no further requirements of these regulations needs to be 
met, and the action may be processed under other applicable disaster 
assistance regulations.
    (3) If an action is determined to be on or connected to a unit of 
the CBRS, it is subject to the consultation and consistency requirements 
of CBRA as prescribed in Secs. 206.348 and 206.349.
    (b) Emergency disaster assistance. For each emergency disaster 
assistance action listed in Sec. 206.346(a), the Regional Director shall 
perform the required consultation. CBRA requires that FEMA consult with 
the Secretary of the Interior before taking any action on a System unit. 
The purpose of such consultation is to solicit advice on whether the 
action is or is not one which is permitted by section 6 of CBRA and 
whether the action is or is not consistent with the purposes of CBRA as 
defined in section 1 of that statute.
    (1) FEMA has conducted advance consultation with the Department of 
the Interior concerning such emergency actions. The result of the 
consultation is that the Secretary of the Interior through the 
Assistance Secretary for Fish and Wildlife and Parks has concurred that 
the emergency work listed in Sec. 206.346(a) is consistent with the 
purposes of CBRA and may be approved by FEMA without additional 
consultation.
    (2) Notification. As soon as practicable, the Regional Director will 
notify the designated Department of the

[[Page 486]]

Interior representative at the regional level of emergency projects that 
have been approved. Upon request from the Secretary of the Interior, the 
Associate Director, SLPS, or his or her designee will supply reports of 
all current emergency actions approved on CBRS units. Notification will 
contain the following information:
    (i) Identification of the unit in the CBRS;
    (ii) Description of work approved;
    (iii) Amount of Federal funding; and
    (iv) Additional measures required.
    (c) Permanent restoration assistance. For each permanent restoration 
assistance action including but not limited to those listed in 
Sec. 206.346(b), the Regional Director shall meet the requirements set 
out below.
    (1) Essential links. For the repair or replacement of publicly owned 
or operated roads, structures or facilities which are essential links in 
a larger network or system:
    (i) No facility may be expanded beyond its predisaster design.
    (ii) Consultation in accordance with Sec. 206.348 shall be 
accomplished.
    (2) Channel improvements. For the repair of existing channels, 
related structures and the disposal of dredged materials:
    (i) No channel or related structure may be repaired, reconstructed, 
or replaced unless funds were appropriated for the construction of such 
channel or structure before October 18, 1982;
    (ii) Expansion of the facility beyond its predisaster design is not 
permitted;
    (iii) Consultation in accordance with Sec. 206.348 shall be 
accomplished.
    (3) Energy facilities. For the repair of facilities necessary for 
the exploration, extraction or transportation of energy resources:
    (i) No such facility may be repaired, reconstructed or replaced 
unless such function can be carried out only in, on, or adjacent to a 
coastal water area because the use or facility requires access to the 
coastal water body;
    (ii) Consultation in accordance with Sec. 206.348 shall be 
accomplished.
    (4) Special-purpose facilities. For the repair of facilities used 
for the study, management, protection or enhancement of fish and 
wildlife resources and habitats and related recreational projects; air 
and water navigation aids and devices and access thereto; and facilities 
used for scientific research, including but not limited to aeronautical, 
atmospheric, space, geologic, marine, fish and wildlife and other 
research, development, and applications; and, nonstructural facilities 
that are designed to mimic, enhance or restore natural shoreline 
stabilization systems:
    (i) Consultation in accordance with Sec. 206.348 shall be 
accomplished;
    (ii) No such facility may be repaired, reconstructed, or replaced 
unless it is otherwise consistent with the purposes of CBRA in 
accordance with Sec. 206.349.
    (5) Other public facilities. For the repair, reconstruction, or 
replacement of publicly owned or operated roads, structures, or 
facilities that do not fall within the categories identified in 
paragraphs (c)(1), (2), (3), and (4) of this section:
    (i) No such facility may be repaired, reconstructed, or replaced 
unless it is an ``existing facility;''
    (ii) Expansion of the facility beyond its predisaster design is not 
permitted;
    (iii) Consultation in accordance with Sec. 206.348 shall be 
accomplished;
    (iv) No such facility may be repaired, reconstructed, or replaced 
unless it is otherwise consistent with the purposes of CBRA in 
accordance with Sec. 206.349.
    (6) Private nonprofit facilities. For eligible private nonprofit 
facilities as defined in these regulations and of the type described in 
paragraphs (c)(1), (2), (3), and (4) of this section:
    (i) Consultation in accordance with Sec. 206.348 shall be 
accomplished.
    (ii) No such facility may be repaired, reconstructed, or replaced 
unless it is otherwise consistent with the purposes of CBRA in 
accordance with Sec. 206.349.
    (7) Improved project. An improved project may not be approved for a 
facility in the CBRS if such grant is to be combined with other funding, 
resulting in an expansion of the facility beyond the predisaster design. 
If a facility is exempt from the expansion prohibitions of CBRA by 
virtue of falling into one of the categories identified in paragraph 
(c)(1), (2), (3), or (4) of this section, then an improved project for 
such facilities is not precluded.

[[Page 487]]

    (8) Alternate project. A new or enlarged facility may not be 
constructed on a unit of the CBRS under the provisions of the Stafford 
Act unless the facility is exempt from the expansion prohibition of CBRA 
by virtue of falling into one of the categories identified in paragraph 
(c)(1), (2), (3), or (4) of this section.



Sec. 206.348  Consultation.

    As required by section 6 of the CBRA, the FEMA Regional Director 
will consult with the designated representative of the Department of the 
Interior (DOI) at the regional level before approving any action 
involving permanent restoration of a facility or structure on or 
attached to a unit of the CBRS.
    (a) The consultation shall be by written memorandum to the DOI 
representative and shall contain the following:
    (1) Identification of the unit within the CBRS;
    (2) Description of the facility and the proposed repair or 
replacement work; including identification of the facility as an 
exception under section 6 of CBRA; and full justification of its status 
as an exception;
    (3) Amount of proposal Federal funding;
    (4) Additional mitigation measures required; and
    (5) A determination of the action's consistency with the purposes of 
CBRA, if required by these regulations, in accordance with Sec. 206.349.
    (b) Pursuant to FEMA understanding with DOI, the DOI representative 
will provide technical information and an opinion whether or not the 
proposed action meets the criteria for a CBRA exception, and on the 
consistency of the action with the purposes of CBRA (when such 
consistency is required). DOI is expected to respond within 12 working 
days from the date of the FEMA request for consultation. If a response 
is not received within the time limit, the FEMA Regional Director shall 
contact the DOI representative to determine if the request for 
consultation was received in a timely manner. If it was not, an 
appropriate extension for response will be given. Otherwise, he or she 
may assume DOI concurrence and proceed with approval of the proposed 
action.
    (c) For those cases in which the regional DOI representative 
believes that the proposed action should not be taken and the matter 
cannot be resolved at the regional level, the FEMA Regional Director 
will submit the issue to the FEMA Assistant Associate Director for 
Disaster Assistance Programs (DAP). In coordination with the Office of 
General Counsel (OGC), consultation will be accomplished at the FEMA 
National Office with the DOI consultation officer. After this 
consultation, the Assistant Associate Director, DAP, determines whether 
or not to approve the proposed action.



Sec. 206.349  Consistency determinations.

    Section 6(a)(6) of CBRA requires that certain actions be consistent 
with the purposes of that statute if the actions are to be carried out 
on a unit of the CBRA. The purpose of CBRA, as stated in section 2(b) of 
that statute, is to minimize the loss of human life, wasteful 
expenditure of Federal revenues, and the damage to fish, wildlife, and 
other natural resources associated with the coastal barriers along with 
Atlantic and Gulf coasts. For those actions where a consistency 
determination is required, the FEMA Regional Director shall evaluate the 
action according to the following procedures, and the evaluation shall 
be included in the written request for consultation with DOI.
    (a) Impact identification. FEMA shall identify impacts of the 
following types that would result from the proposed action:
    (1) Risks to human life;
    (2) Risks of damage to the facility being repaired or replaced;
    (3) Risks of damage to other facilities;
    (4) Risks of damage to fish, wildlife, and other natural resources;
    (5) Condition of existing development served by the facility and the 
degree to which its redevelopment would be encouraged; and
    (6) Encouragement of new development.
    (b) Mitigation. FEMA shall modify actions by means of practicable 
mitigation measures to minimize adverse effects of the types listed in 
paragraph (a) of this section.

[[Page 488]]

    (c) Conservation. FEMA shall identify practicable measures that can 
be incorporated into the proposed action and will conserve natural and 
wildlife resources.
    (d) Finding. For those actions required to be consistent with the 
purposes of CBRA, the above evaluation must result in a finding of 
consistency with CBRA by the Regional Director before funding may be 
approved for that action.



Secs. 206.350-206.359  [Reserved]



                   Subpart K--Community Disaster Loans

    Source: 55 FR 2314, Jan. 23, 1990, unless otherwise noted.



Sec. 206.360  Purpose.

    This subpart provides policies and procedures for local governments 
and State and Federal officials concerning the Community Disaster Loan 
program under section 417 of the Act.



Sec. 206.361  Loan program.

    (a) General. The Associate Director, State and Local Programs and 
Support (the Associate Director) may make a Community Disaster Loan to 
any local government which has suffered a substantial loss of tax and 
other revenues as a result of a major disaster and which demonstrates a 
need for Federal financial assistance in order to perform its 
governmental functions.
    (b) Amount of loan. The amount of the loan is based on need, not to 
exceed 25 percent of the operating budget of the local government for 
the fiscal year in which the disaster occurs. The term fiscal year as 
used in this subpart means the local government's fiscal year.
    (c) Interest rate. The interest rate is the rate for five year 
maturities as determined by the Secretary of the Treasury in effect on 
the date that the Promissory Note is executed. This rate is from the 
monthly Treasury schedule of certified interest rates which takes into 
consideration the current average yields on outstanding marketable 
obligations of the United States, adjusted to the nearest \1/8\ percent.
    (d) Time limitation. The Associate Director may approve a loan in 
either the fiscal year in which the disaster occurred or the fiscal year 
immediately following that year. Only one loan may be approved under 
section 417(a) for any local government as the result of a single 
disaster.
    (e) Term of loan. The term of the loan is 5 years, unless otherwise 
extended by the Associate Director. The Associate Director may consider 
requests for an extensions of loans based on the local government's 
financial condition. The total term of any loan under section 417(a) 
normally may not exceed 10 years from the date the Promissory Note was 
executed. However, when extenuating circumstances exist and the 
Community Disaster Loan recipient demonstrates an inability to repay the 
loan within the initial 10 years, but agrees to repay such loan over an 
extended period of time, additional time may be provided for loan 
repayment. (See Sec. 206.367(c).)
    (f) Use of loan funds. The local government shall use the loaned 
funds to carry on existing local government functions of a municipal 
operation character or to expand such functions to meet disaster-related 
needs. The funds shall not be used to finance capital improvements nor 
the repair or restoration of damaged public facilities. Neither the loan 
nor any cancelled portion of the loans may be used as the nonfederal 
share of any Federal program, including those under the Act.
    (g) Cancellation. The Associate Director shall cancel repayment of 
all or part of a Community Disaster Loan to the extent that he/she 
determines that revenues of the local government during the 3 fiscal 
years following the disaster are insufficient to meet the operating 
budget of that local government because of disaster-related revenue 
losses and additional unreimbursed disaster-related municipal operating 
expenses.
    (h) Relation to other assistance. Any community disaster loans 
including cancellations made under this subpart shall not reduce or 
otherwise affect any commitments, grants, or other assistance under the 
Act or these regulations.

[[Page 489]]



Sec. 206.362  Responsibilities.

    (a) The local government shall submit the financial information 
required by FEMA in the application for a Community Disaster Loan and in 
the application for loan cancellation, if submitted, and comply with the 
assurances on the application, the terms and conditions of the 
Promissory Note, and these regulations. The local government shall send 
all loan application, loan administration, loan cancellation, and loan 
settlement correspondence through the GAR and the FEMA Regional Office 
to the FEMA Associate Director.
    (b) The GAR shall certify on the loan application that the local 
government can legally assume the proposed indebtedness and that any 
proceeds will be used and accounted for in compliance with the FEMA-
State Agreement for the major disaster. States are encouraged to take 
appropriate pre-disaster action to resolve any existing State 
impediments which would preclude a local government from incurring the 
increased indebtedness associated with a loan in order to avoid 
protracted delays in processing loan application requests in major 
disasters or emergencies.
    (c) The Regional Director or designee shall review each loan 
application or loan cancellation request received from a local 
government to ensure that it contains the required documents and 
transmit the application to the Associate Director. He/she may submit 
appropriate recommendations to the Associate Director.
    (d) The Associate Director, or a designee, shall execute a 
Promissory Note with the local government, and the Office of Disaster 
Assistance Programs in Headquarters, FEMA, shall administer the loan 
until repayment or cancellation is completed and the Promissory Note is 
discharged.
    (e) The Associate Director or designee shall approve or disapprove 
each loan request, taking into consideration the information provided in 
the local government's request and the recommendations of the GAR and 
the Regional Director. The Associate Director or designee shall approve 
or disapprove a request for loan cancellation in accordance with the 
criteria for cancellation in these regulations.
    (f) The Comptroller shall establish and maintain a financial account 
for each outstanding loan and disburse funds against the Promissory 
Note.



Sec. 206.363  Eligibility criteria.

    (a) Local government. (1) The local government must be located 
within the area designated by the Associate Director as eligible for 
assistance under a major disaster declaration. In addition, State law 
must not prohibit the local government from incurring the indebtedness 
resulting from a Federal loan.
    (2) Criteria considered by FEMA in determining the eligibility of a 
local government for a Community Disaster Loan include the loss of tax 
and other revenues as result of a major disaster, a demonstrated need 
for financial assistance in order to perform its governmental functions, 
the maintenance of an annual operating budget, and the responsibility to 
provide essential municipal operating services to the community. 
Eligibility for other assistance under the Act does not, by itself, 
establish entitlement to such a loan.
    (b) Loan eligibility--(1) General. To be eligible, the local 
government must show that it may suffer or has suffered a substantial 
loss of tax and other revenues as a result of a major disaster or 
emergency and must demonstrate a need for financial assistance in order 
to perform its governmental functions. Loan eligibility is based on the 
financial condition of the local government and a review of financial 
information and supporting justification accompanying the application.
    (2) Substantial loss of tax and other revenues. The fiscal year of 
the disaster or the succeeding fiscal year is the base period for 
determining whether a local government may suffer or has suffered a 
substantial loss of revenue. Criteria used in determining whether a 
local government has or may suffer a substantial loss of tax and other 
revenue include the following disaster-related factors:
    (i) Whether the disaster caused a large enough reduction in cash 
receipts from normal revenue sources, excluding borrowing, which affects 
significantly and adversely the level and/or

[[Page 490]]

categories of essential municipal services provided prior to the 
disaster;
    (ii) Whether the disaster caused a revenue loss of over 5 percent of 
total revenue estimated for the fiscal year in which the disaster 
occurred or for the succeeding fiscal year;
    (3) Demonstrated need for financial assistance. The local government 
must demonstrate a need for financial assistance in order to perform its 
governmental functions. The criteria used in making this determination 
include the following:
    (i) Whether there are sufficient funds to meet current fiscal year 
operating requirements;
    (ii) Whether there is availability of cash or other liquid assets 
from the prior fiscal year;
    (iii) Current financial condition considering projected expenditures 
for governmental services and availability of other financial resources;
    (iv) Ability to obtain financial assistance or needed revenue from 
State and other Federal agencies for direct program expenditures;
    (v) Debt ratio (relationship of annual receipts to debt service);
    (vi) Ability to obtain financial assistance or needed revenue from 
State and other Federal agencies for direct program expenditures;
    (vii) Displacement of revenue-producing business due to property 
destruction;
    (viii) Necessity to reduce or eliminate essential municipal 
services; and
    (ix) Danger of municipal insolvency.



Sec. 206.364  Loan application.

    (a) Application. (1) The local government shall submit an 
application for a Community Disaster Loan through the GAR. The loan must 
be justified on the basis of need and shall be based on the actual and 
projected expenses, as a result of the disaster, for the fiscal year in 
which the disaster occurred and for the 3 succeeding fiscal years. The 
loan application shall be prepared by the affected local government and 
be approved by the GAR. FEMA has determined that a local government, in 
applying for a loan as a result of having suffered a substantial loss of 
tax and other revenue as a result of a major disaster, is not required 
to first seek credit elsewhere (see Sec. 206.367(c)).
    (2) The State exercises administrative authority over the local 
government's application. The State's review should include a 
determination that the applicant is legally qualified, under State law, 
to assume the proposed debt, and may include an overall review for 
accuracy for the submission. The Governor's Authorized Representative 
may request the Regional Director to waive the requirement for a State 
review if an otherwise eligible applicant is not subject to State 
administration authority and the State cannot legally participate in the 
loan application process.
    (b) Financial requirements. (1) The loan application shall be 
developed from financial information contained in the local government's 
annual operating budget (see Sec. 206.364(b)(2)) and shall include a 
Summary of Revenue Loss and Unreimbursed Disaster-Related Expenses, a 
Statement of the Applicant's Operating Results--Cash Position, a Debt 
History, Tax Assessment Data, Financial Projections, Other Information, 
a Certification, and the Assurances listed on the application.
    (i) Copies of the local government's financial reports (Revenue and 
Expense and Balance Sheet) for the 3 fiscal years immediately prior to 
the fiscal year of the disaster and the applicant's most recent 
financial statement must accompany the application. The local 
government's financial reports to be submitted are those annual (or 
interim) consolidated and/or individual official annual financial 
presentations for the General Fund and all other funds maintained by the 
local government.
    (ii) Each application for a Community Disaster Loan must also 
include:
    (A) A statement by the local government identifying each fund (i.e. 
General Fund, etc.) which is included as its annual Operating budget, 
and
    (B) A copy of the pertinent State statutes, ordinance, or 
regulations which prescribe the local government's system of budgeting, 
accounting and financial reporting, including a description of each fund 
account.
    (2) Operating budget. For loan application purposes, the operating 
budget is

[[Page 491]]

that document or documents approved by an appropriating body, which 
contains an estimate of proposed expenditures, other than capital 
outlays for fixed assets for a stated period of time, and the proposed 
means of financing the expenditures. For loan cancellation purposes, 
FEMA interprets the term ``operating budget'' to mean actual revenues 
and expenditures of the local government as published in the official 
financial statements of the local government.
    (3) Operating budget increases. Budget increases due to increases in 
the level of, or additions to, municipal services not rendered at the 
time of the disaster or not directly related to the disaster shall be 
identified.
    (4) Revenue and assessment information. The applicant shall provide 
information concerning its method of tax assessment including assessment 
dates and the dates payments are due. Tax revenues assessed but not 
collected, or other revenues which the local government chooses to 
forgive, stay, or otherwise not exercise the right to collect, are not a 
legitimate revenue loss for purposes of evaluating the loan application.
    (5) Estimated disaster-related expense. Unreimbursed disaster-
related expenses of a municipal operating character should be estimated. 
These are discussed in Sec. 206.366(b).
    (c) Federal review. (1) The Associate Director or designee shall 
approve a community disaster loan to the extent it is determined that 
the local government has suffered a substantial loss of tax and other 
revenues and demonstrates a need for financial assistance to perform its 
governmental function as the result of the disaster.
    (2) Resubmission of application. If a loan application is 
disapproved, in whole or in part, by the Associate Director because of 
inadequacy of information, a revised application may be resubmitted by 
the local government within sixty days of the date of the disapproval. 
Decision by the Associate Director on the resubmission is final.
    (d) Community disaster loan. (1) The loan shall not exceed the 
lesser of:
    (i) The amount of projected revenue loss plus the projected 
unreimbursed disaster-related expenses of a municipal operating 
character for the fiscal year of the major disaster and the subsequent 3 
fiscal years, or
    (ii) 25 percent of the local government's annual operating budget 
for the fiscal year in which the disaster occurred.
    (2) Promissory note. (i) Upon approval of the loan by the Associate 
Director or designee, he or she, or a designated Loan Officer will 
execute a Promissory Note with the applicant. The Note must be co-signed 
by the State (see Sec. 206.364(d)(2)(ii)). The applicant should indicate 
its funding requirements on the Schedule of Loan Increments on the Note.
    (ii) If the State cannot legally cosign the Promissory Note, the 
local government must pledge collateral security, acceptable to the 
Associate Director, to cover the principal amount of the Note. The 
pledge should be in the form of a resolution by the local governing body 
identifying the collateral security.

(Approved by Office of Management and Budget under Control Number 3067-
0034)



Sec. 206.365  Loan administration.

    (a) Funding. (1) FEMA will disburse funds to the local government 
when requested, generally in accordance with the Schedule of Loan 
Increments in the Promissory Note. As funds are disbursed, interest will 
accrue against each disbursement.
    (2) When each incremental disbursement is requested, the local 
government shall submit a copy of its most recent financial report (if 
not submitted previously) for consideration by FEMA in determining 
whether the level and frequency of periodic payments continue to be 
justified. The local government shall also provide the latest available 
data on anticipated and actual tax and other revenue collections. 
Desired adjustments in the disbursement schedule shall be submitted in 
writing at least 10 days prior to the proposed disbursement date in 
order to ensure timely receipt of the funds. A sinking fund should be 
established to amortize the debt.
    (b) Financial management. (1) Each local government with an approved

[[Page 492]]

Community Disaster Loan shall establish necessary accounting records, 
consistent with local government's financial management system, to 
account for loan funds received and disbursed and to provide an audit 
trail.
    (2) FEMA auditors, State auditors, the GAR, the Regional Director, 
the Associate Director, and the Comptroller General of the United States 
or their duly authorized representatives shall, for the purpose of 
audits and examination, have access to any books, documents, papers, and 
records that pertain to Federal funds, equipments, and supplies received 
under these regulations.
    (c) Loan servicing. (1) The applicant annually shall submit to FEMA 
copies of its annual financial reports (operating statements, balance 
sheets, etc.) for the fiscal year of the major disaster, and for each of 
the 3 subsequent fiscal years.
    (2) The Headquarters, FEMA Office of Disaster Assistance Programs, 
will review the loan periodically. The purpose of the reevaluation is to 
determine whether projected revenue losses, disaster-related expenses, 
operating budgets, and other factors have changed sufficiently to 
warrant adjustment of the scheduled disbursement of the loan proceeds.
    (3) The Headquarters, FEMA Office of Disaster Assistance Programs, 
shall provide each loan recipient with a loan status report on a 
quarterly basis. The recipient will notify FEMA of any changes of the 
responsible municipal official who executed the Promissory Note.
    (d) Inactive loans. If no funds have been disbursed from the 
Treasury, and if the local government does not anticipate a need for 
such funds, the note may be cancelled at any time upon a written request 
through the State and Regional Office to FEMA. However, since only one 
loan may be approved, cancellation precludes submission of a second loan 
application request by the same local government for the same disaster.



Sec. 206.366  Loan cancellation.

    (a) Policies. (1) FEMA shall cancel repayment of all or part of a 
Community Disaster Loan to the extent that the Associate Director 
determines that revenues of the local government during the full three 
fiscal year period following the disaster are insufficient, as a result 
of the disaster, to meet the operating budget for the local government, 
including additional unreimbursed disaster-related expenses for a 
municipal operating character. For loan cancellation purposes, FEMA 
interprets that term operating budget to mean actual revenues and 
expenditures of the local government as published in the official 
financial statements of the local government.
    (2) If the tax and other revenues rates or the tax assessment 
valuation of property which was not damaged or destroyed by the disaster 
are reduced during the 3 fiscal years subsequent to the major disaster, 
the tax and other revenue rates and tax assessment valuation factors 
applicable to such property in effect at the time of the major disaster 
shall be used without reduction for purposes of computing revenues 
received. This may result in decreasing the potential for loan 
cancellations.
    (3) If the local government's fiscal year is changed during the 
``full 3 year period following the disaster'' the actual period will be 
modified so that the required financial data submitted covers an 
inclusive 36-month period.
    (4) If the local government transfers funds from its operating funds 
accounts to its capital funds account, utilizes operating funds for 
other than routine maintenance purposes, or significantly increases 
expenditures which are not disaster related, except increases due to 
inflation, the annual operating budget or operating statement 
expenditures will be reduced accordingly for purposes of evaluating any 
request for loan cancellation.
    (5) It is not the purpose of this loan program to underwrite 
predisaster budget or actual deficits of the local government. 
Consequently, such deficits carried forward will reduce any amounts 
otherwise eligible for loan cancellation.
    (b) Disaster-related expenses of a municipal operation character. 
(1) For purpose of this loan, unreimbursed expenses of a municipal 
operating character are those incurred for general

[[Page 493]]

government purposes, such as police and fire protection, trash 
collection, collection of revenues, maintenance of public facilities, 
flood and other hazard insurance, and other expenses normally budgeted 
for the general fund, as defined by the Municipal Finance Officers 
Association.
    (2) Disaster-related expenses do not include expenditures associated 
with debt service, any major repairs, rebuilding, replacement or 
reconstruction of public facilities or other capital projects, 
intragovernmental services, special assessments, and trust and agency 
fund operations. Disaster expenses which are eligible for reimbursement 
under project applications or other Federal programs are not eligible 
for loan cancellation.
    (3) Each applicant shall maintain records including documentation 
necessary to identify expenditures for unreimbursed disaster-related 
expenses. Examples of such expenses include but are not limited to:
    (i) Interest paid on money borrowed to pay amounts FEMA does not 
advance toward completion of approved Project Applications.
    (ii) Unreimbursed costs to local governments for providing usable 
sites with utilities for mobile homes used to meet disaster temporary 
housing requirements.
    (iii) Unreimbursed costs required for police and fire protection and 
other community services for mobile home parks established as the result 
of or for use following a disaster.
    (iv) The cost to the applicant of flood insurance required under 
Public Law 93-234, as amended, and other hazard insurance required under 
section 311, Public Law 93-288, as amended, as a condition of Federal 
disaster assistance for the disaster under which the loan is authorized.
    (4) The following expenses are not considered to be disaster-related 
for Community Disaster Loan purposes:
    (i) The local government's share for assistance provided under the 
Act including flexible funding under section 406(c)(1) of the Act.
    (ii) Improvements related to the repair or restoration of disaster 
public facilities approved on Project Applications.
    (iii) Otherwise eligible costs for which no Federal reimbursement is 
requested as a part of the applicant's disaster response commitment, or 
cost sharing as specified in the FEMA-State Agreement for the disaster.
    (iv) Expenses incurred by the local government which are reimbursed 
on the applicant's project application.
    (c) Cancellation application. A local government which has drawn 
loan funds from the Treasury may request cancellation of the principal 
and related interest by submitting an Application for Loan Cancellation 
through the Governor's Authorized Representative to the Regional 
Director prior to the expiration date of the loan.
    (1) Financial information submitted with the application shall 
include the following:
    (i) Annual Operating Budgets for the fiscal year of the disaster and 
the 3 subsequent fiscal years;
    (ii) Annual Financial Reports (Revenue and Expense and Balance 
Sheet) for each of the above fiscal years. Such financial records must 
include copies of the local government's annual financial reports, 
including operating statements balance sheets and related consolidated 
and individual presentations for each fund account. In addition, the 
local government must include an explanatory statement when figures in 
the Application for Loan Cancellation form differ from those in the 
supporting financial reports.
    (iii) The following additional information concerning annual real 
estate property taxes pertaining to the community for each of the above 
fiscal years:
    (A) The market value of the tax base (dollars);
    (B) The assessment ratio (percent);
    (C) The assessed valuation (dollars);
    (D) The tax levy rate (mils);
    (E) Taxes levied and collected (dollars).
    (iv) Audit reports for each of the above fiscal years certifying to 
the validity of the Operating Statements. The financial statements of 
the local government shall be examined in accordance with generally 
accepted auditing standards by independent certified public accountants. 
The report should not include recommendations

[[Page 494]]

concerning loan cancellation or repayment.
    (v) Other financial information specified in the Application for 
Loan Cancellation.
    (2) Narrative justification. The application may include a narrative 
presentation to amplify the financial material accompanying the 
application and to present any extenuating circumstances which the local 
government wants the Associate Director to consider in rendering a 
decision on the cancellation request.
    (d) Determination. (1) If, based on a review of the Application for 
Loan Cancellation and FEMA audit, when determined necessary, the 
Associate Director determines that all or part of the Community Disaster 
Loan funds should be canceled, the principal amount which is canceled 
will become a grant, and the related interest will be forgiven. The 
Associate Director's determination concerning loan cancellation will 
specify that any uncancelled principal and related interest must be 
repaid immediately and that, if immediate repayment will constitute a 
financial hardship, the local government must submit for FEMA review and 
approval, a repayment schedule for settling the indebtedness on timely 
basis. Such repayments must be made to the Treasurer of the United 
States and be sent to FEMA, Attention: Office of the Comptroller.
    (2) A loan or cancellation of a loan does not reduce or affect other 
disaster-related grants or other disaster assistance. However, no 
cancellation may be made that would result in a duplication of benefits 
to the applicant.
    (3) The uncancelled portion of the loan must be repaid in accordance 
with Sec. 206.367.
    (4) Appeals. If an Application for Loan Cancellation is disapproved, 
in whole or in part, by the Associate Director or designee, the local 
government may submit any additional information in support of the 
application within 60 days of the date of disapproval. The decision by 
the Associate Director or designee on the submission is final.

(Approved by the Office of Management and Budget under Control Number 
3067-0026)



Sec. 206.367  Loan repayment.

    (a) Prepayments. The local government may make prepayments against 
loan at any time without any prepayment penalty.
    (b) Repayment. To the extent not otherwise cancelled, Community 
Disaster Loan funds become du and payable in accordance with the terms 
and conditions of the Promissory Note. The note shall include the 
following provisions:
    (1) The term of a loan made under this program is 5 years, unless 
extended by the Associate Director. Interest will accrue on outstanding 
cash from the actual date of its disbursement by the Treasury.
    (2) The interest amount due will be computed separately for each 
Treasury disbursement as follows: I=P x R x T, where I=the amount of 
simple interest, P=the principal amount disbursed; R=the interest rate 
of the loan; and, T=the outstanding term in years from the date of 
disbursement to date of repayment, with periods less than 1 year 
computed on the basis of 365 days/year. If any portion of the loan is 
cancelled, the interest amount due will be computed on the remaining 
principal with the shortest outstanding term.
    (3) Each payment made against the loan will be applied first to the 
interest computed to the date of the payment, and then to the principal. 
Prepayments of scheduled installments, or any portion thereof, may be 
made at any time and shall be applied to the installments last to become 
due under the loan and shall not affect the obligation of the borrower 
to pay the remaining installments.
    (4) The Associate Director may defer payments of principal and 
interest until FEMA makes its final determination with respect to any 
Application for Loan Cancellation which the borrower may submit. 
However, interest will continue to accrue.
    (5) Any costs incurred by the Federal Government in collecting the 
note shall be added to the unpaid balance of the loan, bear interest at 
the same rate as the loan, and be immediately due without demand.
    (6) In the event of default on this note by the borrower, the FEMA

[[Page 495]]

claims collection officer will take action to recover the outstanding 
principal plus related interest under Federal debt collection 
authorities, including administrative offset against other Federal funds 
due the borrower and/or referral to the Department of Justice for 
judicial enforcement and collection.
    (c) Additional time. In unusual circumstances involving financial 
hardship, the local government may request an additional period of time 
beyond the original 10 year term to repay the indebtedness. Such request 
may be approved by the Associate Director subject to the following 
conditions:
    (1) The local government must submit documented evidence that it has 
applied for the same credit elsewhere and that such credit is not 
available at a rate equivalent to the current Treasury rate.
    (2) The principal amount shall be the original uncancelled principal 
plus related interest.
    (3) The interest rate shall be the Treasury rate in effect at the 
time the new Promissory Note is executed but in no case less than the 
original interest rate.
    (4) The term of the new Promissory Note shall be for the settlement 
period requested by the local government but not greater than 10 years 
from the date the new note is executed.



Secs. 206.368-206.389  [Reserved]



                 Subpart L--Fire Suppression Assistance

    Source: 55 FR 2318, Jan. 23, 1990, unless otherwise noted.



Sec. 206.390  General.

    When the Associate Director determines that a fire or fires threaten 
such destruction as would constitute a major disaster, assistance may be 
authorized, including grants, equipment, supplies, and personnel, to any 
State for the suppression of any fire on publicly or privately owned 
forest or grassland.



Sec. 206.391  FEMA-State Agreement.

    Federal assistance under section 420 of the Act is provided in 
accordance with a continuing FEMA-State Agreement for Fire Suppression 
Assistance (the Agreement) signed by the Governor and the Regional 
Director. The Agreement contains the necessary terms and conditions, 
consistent with the provisions of applicable laws, Executive Orders, and 
regulations, as the Associate Director may require and specifies the 
type and extent of Federal assistance. The Governor may designate 
authorized representatives to execute requests and certifications and 
otherwise act for the State during fire emergencies. Supplemental 
agreements shall be executed as required to update the continuing 
Agreement.



Sec. 206.392  Request for assistance.

    When a Governor determines that fire suppression assistance is 
warranted, a request for assistance may be initiated. Such request shall 
specify in detail the factors supporting the request for assistance. In 
order that all actions in processing a State request are executed as 
rapidly as possible, the State may submit a telephone request to the 
Regional Director, promptly followed by a confirming telegram or letter. 
(Approved by the Office of Management and Budget under the Control 
Numbers 3067-0066)



Sec. 206.393  Providing assistance.

    Following the Associate Director's decision on the State request, 
the Regional Director will notify the Governor and the Federal 
firefighting agency involved. The Regional Director may request 
assistance from Federal agencies if requested by the State. For each 
fire or fire situation, the State shall prepare a separate Fire Project 
Application based on Federal Damage Survey Reports and submit it to the 
Regional Director for approval.



Sec. 206.394  Cost eligibility.

    (a) Cost principles. See 44 CFR 13.22, Allowable Costs, and the 
associated OMB Circular A-87, Cost Principles for State and Local 
Governments.
    (b) Program specific eligible costs. (1) Expenses to provide field 
camps and meals when made available to the eligible employees in lieu of 
per diem costs.

[[Page 496]]

    (2) Costs for use of publicly owned equipment used on eligible fire 
suppression work based on reasonable State equipment rates.
    (3) Costs to the State for use of U.S. Government-owned equipment 
based on reasonable costs as billed by the Federal agency and paid by 
the State. Only direct costs for use of Federal Excess Personal Property 
(FEPP) vehicles and equipment on loan to State Forestry and local 
cooperators, can be paid.
    (4) Cost of firefighting tools, materials, and supplies expended or 
lost, to the extent not covered by reasonable insurance.
    (5) Replacement value of equipment lost in fire suppression, to the 
extent not covered by reasonable insurance.
    (6) Costs for personal comfort and safety items normally provided by 
the State under field conditions for firefighter health and safety.
    (7) Mobilization and demobilization costs directly relating to the 
Federal fire suppression assistance approved by the Associate Director.
    (8) Eligible costs of local governmental firefighting organizations 
which are reimbursed by the State pursuant to an existing cooperative 
mutual aid agreement, in suppressing an approved incident fire.
    (9) State costs for suppressing fires on Federal land in cases in 
which the State has a responsibility under a cooperative agreement to 
perform such action on a nonreimbursable basis. This provision is an 
exception to normal FEMA policy under the Act and is intended to 
accommodate only those rare instances that involve State fire 
suppression of section 420 incident fires involving co-mingled Federal/
State and privately owned forest or grassland.
    (10) In those instances in which assistance under section 420 of the 
Act is provided in conjunction with existing Interstate Forest Fire 
Protection Compacts, eligible costs are reimbursed in accordance with 
eligibility criteria established in this section.
    (c) Program specific ineligible costs. (1) Any costs for 
presuppression, salvaging timber, restoring facilities, seeding and 
planting operations.
    (2) Any costs not incurred during the incident period as determined 
by the Regional Director other than reasonable and directly related 
mobilization and demobilization costs.
    (3) State costs for suppressing a fire on co-mingled Federal land 
where such costs are reimbursable to the State by a Federal agency under 
another statute (see 44 CFR part 151).



Sec. 206.395  Grant administration.

    (a) Project administration shall be in accordance with 44 CFR part 
13, and applicable portions of subpart G, 44 CFR part 206.
    (b) In those instances in which reimbursement includes State fire 
suppression assistance on co-mingled State and Federal lands 
(Sec. 206.394(b)(9)), the Regional Director shall coordinate with other 
Federal programs to preclude any duplication of payments. (See 44 CFR 
part 151.)
    (c) Audits shall be in accordance with the Single Audit Act of 1984, 
Pub. L. 98-502. (See subpart G of this part.)
    (d) A State may appeal a determination by the Regional Director on 
any action related to Federal assistance for fire suppression. Appeal 
procedures are contained in 44 CFR 206.206.



Secs. 206.396-206.399  [Reserved]



                  Subpart M--Hazard Mitigation Planning

    Source: 55 FR 35529, Aug. 30, 1990, unless otherwise noted.



Sec. 206.400  General.

    This subpart prescribes the requirements for implementation of 
section 409 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (Pub. L. 93-288, as amended, hereinafter referred to as 
the ``Stafford Act'') and prescribes Federal, State and local hazard 
mitigation planning responsibilities following the declaration of a 
major disaster or emergency, or declaration for fire suppression 
assistance pursuant to section 420 of the Stafford Act.



Sec. 206.401  Definitions.

    Federal Hazard Mitigation Officer is the FEMA employee responsible 
for carrying out the overall responsibilities for hazard mitigation and 
for this

[[Page 497]]

subpart, including coordinating post-disaster hazard mitigation actions 
with other agencies of government at all levels.
    Hazard Mitigation means any action taken to reduce or eliminate the 
long-term risk to human life and property from natural hazards.
    Hazard Mitigation Grant Program means the program authorized under 
section 404 of the Stafford Act, which may provide funding for certain 
mitigation measures identified through the evaluation of hazards 
conducted under section 409 of the Stafford Act.
    Hazard Mitigation Plan means the plan resulting from a systematic 
evaluation of the nature and extent of vulnerability to the effects of 
natural hazards present in society and includes the actions needed to 
minimize future vulnerability to hazards, as required under section 409 
of the Stafford Act.
    Hazard Mitigation Plan Update means an update to the existing hazard 
mitigation plan, which may be accomplished either by updating the status 
of mitigation actions within the existing plan, or by expanding the 
existing plan to address additional hazards or mitigation issues.
    Hazard Mitigation Survey Team means the FEMA/State/Local survey team 
that is activated following disasters to identify immediate mitigation 
opportunities and issues to be addressed in the section 409 hazard 
mitigation plan. The Hazard Mitigation Survey Team may include 
representatives of other Federal agencies, as appropriate.
    Interagency Hazard Mitigation Team means the mitigation team that is 
activated following flood related disasters pursuant to the July 10, 
1980 Office of Management and Budget directive on Nonstructural Flood 
Protection Measures and Flood Disaster Recovery, and the subsequent 
December 15, 1980 Interagency Agreement for Nonstructural Damage 
Reduction.
    Local Hazard Mitigation Officer is the representative of local 
government who serves on the Hazard Mitigation Survey Team or 
Interagency Hazard Mitigation Team and who is the primary point of 
contact with FEMA, other Federal agencies, and the State in the planning 
and implementation of post-disaster hazard mitigation activities.
    Measure means any mitigation measure, project, or action proposed to 
reduce risk of future damage, hardship, loss or suffering from 
disasters.
    Natural Disaster is any natural catastrophe, including any 
hurricane, tornado, storm, high water, wind driven water, tidal wave, 
tsunami, earthquake, volcanic eruption, landslide, mudslide, snowstorm, 
fire, or drought.
    State Hazard Mitigation Officer is the representative of State 
government who is the primary point of contact with FEMA, other Federal 
agencies, and local units of government in the planning and 
implementation of post-disaster mitigation programs and activities 
required under the Stafford Act.



Sec. 206.402  Responsibilities.

    (a) General. This section identifies the key responsibilities of 
FEMA, States, and local participants in carrying out the requirements of 
section 409 of the Stafford Act.
    (b) FEMA. The key responsibilities of the FEMA Regional Director are 
to:
    (1) Oversee all FEMA-related pre- and post-disaster hazard 
evaluation and mitigation programs and activities;
    (2) Appoint a Federal Hazard Mitigation Officer for each disaster to 
manage hazard mitigation programs and activities;
    (3) Provide technical assistance to State and local governments in 
fulfiling mitigation responsibilities;
    (4) Conduct periodic review of State hazard mitigation activities 
and programs to ensure that States are adequately prepared to meet their 
responsibilities under the Stafford Act;
    (5) Assist the State in the identification of the appropriate 
mitigation actions that a State or locality must take in order to have a 
measurable impact on reducing or avoiding the adverse effects of a 
specific hazard or hazardous situation.
    (6) Subsequent to a declaration, follow-up with State and local 
governments to ensure that mitigation commitments are fulfilled, and 
when necessary, take action, including recovery of funds or denial of 
future funds, if

[[Page 498]]

mitigation commitments are not fulfilled.
    (c) States. The key responsibilities of the State are to coordinate 
all State and local responsibilities regarding hazard evaluation and 
mitigation, and to;
    (1) Appoint a State Hazard Mitigation Officer, who reports to the 
governor's authorized representative, and who serves as the point of 
contact for and coordinates all matters relating to section 409 hazard 
mitigation planning and implementation;
    (2) Prepare and submit, in accordance with the FEMA/State Agreement 
and the requirements of this subpart, a hazard mitigation plan(s) or 
update to existing plan(s), as required under Sec. 206.405. Such plan or 
update is to include an evaluation of the natural hazards in the 
declared area, and an identification of appropriate actions to mitigate 
those hazards;
    (3) Participate in the Hazard Mitigation Survey Team or Interagency 
Hazard Mitigation Team activated after the declaration;
    (4) Arrange for appropriate State and local participation on the 
Hazard Mitigation Survey Team or Interagency Hazard Mitigation Team and 
in the section 409 planning process;
    (5) Follow-up with State agencies and local governments to assure 
that appropriate hazard mitigation actions are taken. This involves 
coordination of plans and actions of local governments to assure that 
they are not in conflict with each other or with State plans;
    (6) Ensure that the activities, programs and policies of all State 
agencies related to hazard evaluation, vulnerability, and mitigation are 
coordinated and contribute to the overall lessening or avoiding of 
vulnerability to natural hazards.
    (d) Local governments. The key responsibilities of local governments 
are to:
    (1) Participate in the process of evaluating hazards and adoption of 
appropriate hazard mitigation measures, including land use and 
construction standards;
    (2) Appoint a Local Hazard Mitigation Officer, if appropriate;
    (3) Participate on Hazard Mitigation Survey Teams and Interagency 
Hazard Mitigation Teams, as appropriate;
    (4) Participate in the development and implementation of section 409 
plans or plan updates, as appropriate;
    (5) Coordinate and monitor the implementation of local hazard 
mitigation measures.



Sec. 206.403  Pre-declaration activities.

    (a) General. As part of FEMA's response to a Governor's request for 
a declaration, FEMA will evaluate information concerning the status of 
hazard mitigation efforts in the impacted State and localities.
    (b) Mitigation evaluation. The mitigation review of State and local 
government activities in the impacted area shall include:
    (1) The status of a statewide comprehensive hazard mitigation plans, 
programs, or strategies;
    (2) The status of hazard mitigation plans or plan updates required 
as a condition of any previous declaration;
    (3) The status of any actions which the State or localities agreed 
to undertake as a condition of past disaster assistance;
    (4) The status of any mitigation measures funded under section 404 
of the Stafford Act for any previous declaration;
    (5) The status of any other hazard evaluation and mitigation 
projects funded under other FEMA or other Federal agency programs;
    (6) An evaluation of the impact of the hazard(s) and any 
corresponding mitigation issues pertinent to the area for which Federal 
disaster assistance is being requested;
    (7) Any other hazard evaluation and mitigation information available 
and considered relevant.
    (c) FEMA-State agreement. Based on the conditions warranted by the 
declaration, and on the findings of the mitigation evaluation, the FEMA-
State Agreement shall include appropriate mitigation provisions, such as 
the requirement to prepare a hazard mitigation plan or update.

[[Page 499]]



Sec. 206.404  Mitigation survey teams.

    (a) Hazard mitigation surveys. Hazard mitigation surveys are 
performed immediately following the declaration of a disaster to 
identify the following:
    (1) Hazard evaluation and mitigation measures that must be 
incorporated into the recovery process;
    (2) Possible measures for funding under the Hazard Mitigation Grant 
Program, or under other disaster assistance programs;
    (3) Issues for inclusion in the section 409 hazard mitigation plan.
    (b) Hazard Mitigation Survey Teams. Hazard Mitigation Survey Teams 
shall be activated by the Regional Director immediately following the 
declaration to conduct hazard mitigation surveys. The Hazard Mitigation 
Survey Team shall consist of FEMA, State, and appropriate local 
government representatives, and representatives of any other Federal 
agencies that may be appropriate. In the case of flood declarations, the 
Interagency Hazard Mitigation Team will serve the purpose of the Hazard 
Mitigation Survey Team.
    (c) Survey team reports. Within 15 days following a declaration 
Hazard Mitigation Survey Team report shall be prepared and distributed 
in accordance with FEMA policies and procedures. The Regional Director 
has the authority to extend this due date when necessary.



Sec. 206.405  Hazard mitigation plan.

    (a) General. In order to fulfill the requirement to evaluate natural 
hazards within the designated area and to take appropriate action to 
mitigate such hazards the State shall prepare and implement a hazard 
mitigation plan or plan update. At a minimum the plan shall contain the 
following:
    (1) An evaluation of the natural hazards in the designated area;
    (2) A description and analysis of the State and local hazard 
management policies, programs, and capabilities to mitigate the hazards 
in the area;
    (3) Hazard mitigation goals and objectives and proposed strategies, 
programs, and actions to reduce or avoid long term vulnerability to 
hazards,
    (4) A method of implementing, monitoring, evaluating, and updating 
the mitigation plan. Such evaluation is to occur at least on an annual 
basis to ensure that implementation occurs as planned, and to ensure 
that the plan remains current.
    (b) Plan approach. Hazard mitigation plans should be oriented toward 
helping States and localities to develop hazard management capabilities 
and programs as part of normal governmental functions. All States are 
encouraged to develop a basic mitigation plan prior to the occurrence of 
a disaster, so that the basic plan can simply be expanded or updated to 
address specific issues arising from the disaster. At the time of a 
declaration, the Regional Director, in consultation with the State, 
shall determine whether a new mitigation plan is required as a result of 
the declaration, or whether an existing plan can simply be updated or 
expanded.
    (c) Plan content and format. The specific content and format of a 
hazard mitigation plan or plan update shall be determined through 
guidance and technical assistance that the Regional Director provides to 
the State during the section 409 planning process. At a minimum, the 
plan or update must address the items listed in paragraph (a) of this 
section.
    (d) Plan submission. All States shall submit a hazard mitigation 
plan or plan update on behalf of the State and any appropriate local 
governments included in the designated area. The plan or update is due 
to FEMA within 180 days of the date of the declaration. The Regional 
Director may grant extensions to this date not to exceed 365 days from 
the date of the declaration when adequate justification is received in 
writing from the State. Extensions beyond that date must be forwarded 
with justification to the Associate Director for approval.
    (e) Plan approval. Upon receipt of a hazard mitigation plan or plan 
update, the Regional Director shall acknowledge receipt in writing to 
the Governor or appropriate agency. Written comments shall state whether 
the plan is approved, shall detail any shortcomings that may exist, and 
shall include a suggested method and timeline for correction if 
necessary.

(Approved by the Office of Management and Budget under OMB control 
number 3067-0212)


[[Page 500]]





Sec. 206.406  Hazard mitigation planning process.

    (a) General. A sound planning process is essential to the 
development and implementation of an effective hazard mitigation plan. A 
critical element of successful mitigation planning is the involvement of 
key State agencies, local units of government, and other public or 
private sector bodies or agencies that influence hazard management or 
development policies within a State or local unit of government. This 
section identifies principal components of the mitigation planning 
process.
    (b) FEMA technical assistance. States may request the Regional 
Director to provide technical assistance and guidance throughout the 
planning process to ensure that the plan or update adequately addresses 
mitigation concerns related to the disaster. Technical assistance may 
include but is not limited to:
    (1) Identification of mitigation issues through the Interagency 
Hazard Mitigation Team or Hazard Mitigation Survey Team report;
    (2) Initial meeting with the State to identify key staff, timeline, 
and scope of work for development of the hazard mitigation plan or 
update;
    (3) Review of timelines, outlines, drafts, and other appropriate 
material during development of the hazard mitigation plan or update.
    (4) Provision of Federal technical assistance information and 
identification of technical experts, if needed.
    (c) State involvement. Though the primary responsibility for 
development of a hazard mitigation plan is assigned to one State agency, 
any State agency that influence development within hazardous areas 
through ongoing programs and activities should be involved in the 
development and implementation of hazard mitigation plans. This 
includes, but is not limited to, agencies involved with emergency 
management, natural resources, environmental regulations, planning and 
zoning, community development, building regulations, infrastructure 
regulation or construction, public information, and insurance. It is the 
responsibility of the State agency assigned lead responsibility for 
hazard mitigation to ensure that all other appropriate State agencies 
have the opportunity to participate in development and implementation of 
hazard mitigation planning.
    (d) Local involvement. Local participation in hazard mitigation 
planning is essential because regulation and control of development 
within hazardous areas normally occurs at the local level. It is the 
responsibility of the State to ensure that appropriate local 
participation is obtained during development and implementation of 
hazard mitigation planning.
    (e) Private sector involvement. When appropriate, a State or local 
government may choose to involve the private sector in the planning 
process. Support from the private sector is often essential to 
successful implementation of mitigation strategies at the local level. 
Involvement of the private sector in the early stages of the planning 
process may facilitate understanding and support for mitigation.
    (f) Development of hazard mitigation goals and objectives. The 
participants in the planning process shall develop the basic mitigation 
goals and objectives from which the proposed hazard mitigation 
strategies, programs, and actions required under Sec. 206.405(3) shall 
be drawn.
    (g) Identification of projects to be funded under the Hazard 
Mitigation Grant Program. The Hazard Mitigation Grant Program, 
authorized under section 404 of the Stafford Act, provides up to 50 
percent Federal funding for cost-effective mitigation measures that are 
consistent with the evaluation of hazards under section 409. Throughout 
the process of preparing a hazard mitigation plan or plan update, the 
State and local governments will be evaluating natural hazards and 
identifying potential mitigation measures which may be eligible for 
funding under the Hazard Mitigation Grant Program. 44 CFR part 206, 
subpart N sets forth the regulations for funding these mitigation 
measures.
    (h) Coordination with other hazard evaluation and mitigation 
planning efforts. During the process of developing a mitigation plan to 
satisfy requirements under this subpart, the State will ensure that the 
planning effort is coordinated with any other hazard evaluation and 
mitigation planning

[[Page 501]]

program within the State or local unit of government, including but not 
limited to the Disaster Preparedness Improvement Grant Program, the 
Hurricane Program, the Earthquake Hazard Reduction Program, the Dam 
Safety Program, the National Flood Insurance Program, and other similar 
programs of FEMA and other Federal agencies.
    (i) Evaluation and monitoring. The State is responsible for 
monitoring and evaluating implementation of the hazard mitigation plan 
and for submitting annual progress reports to FEMA. The progress report 
will briefly indicate the status of implementation of the mitigation 
actions contained within the plan, and will include documentation 
relating to measures which have been implemented, where appropriate. The 
Regional Director may require the State to provide additional progress 
reports or more specific information on particularly critical mitigation 
actions, if necessary.



Sec. 206.407  Minimum standards.

    (a) General. As a condition of any disaster loan or grant made under 
the Stafford Act, section 409 requires that the recipient shall agree 
that any repair or construction shall be in accordance with applicable 
standards of safety, decency, and sanitation, and in conformity with 
applicable codes, specifications, and standards. The hazard mitigation 
planning process required under section 409 can assist with the 
identification of inadequate standards as described below.
    (b) Local standards. The cost of bringing a facility up to minimum 
standards is an eligible cost under subpart H of this part when such 
standards apply to the types of work being performed. These standards, 
including standards for hazard mitigation, can either be in place at the 
time of the disaster or can be adopted prior to approval of the project. 
Where current mitigation standards are inadequate, new standards may be 
identified in the following ways:
    (1) Through the Interagency Hazard Mitigation Team or Hazard 
Mitigation Survey Team;
    (2) Through the hazard mitigation planning process;
    (3) By the State or local governments;
    (4) Through the public assistance program; and,
    (5) Through identification of mitigation measures under the Hazard 
Mitigation Grant Program.
    (c) Compliance. The State shall ensure that the sub-grantee meets 
compliance with minimum standards as that term is used in section 409.



               Subpart N--Hazard Mitigation Grant Program

    Source: 55 FR 35537, Aug. 30, 1990, unless otherwise noted.



Sec. 206.430  General.

    This subpart provides guidance on the administration of hazard 
mitigation grants made under the provisions of section 404 of the Robert 
T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 
5170c, hereafter Stafford Act, or the Act.

[59 FR 24356, May 11, 1994]



Sec. 206.431  Definitions.

    (a) Applicant means a State agency, local government, or eligible 
private nonprofit organization, as defined in subpart H of this part, 
submitting an application to the Governor's Authorized Representative 
for assistance under the Hazard Mitigation Grant Program.
    (b) Application means the initial request for section 404 funding, 
as outlined in Sec. 206.436.
    (c) Grant means an award of financial assistance. The total grant 
award shall not exceed ten percent of the estimated Federal assistance 
provided under section 406 of the Stafford Act for major disasters 
declared before June 10, 1993. For major disasters declared on or after 
June 10, 1993, the total grant award shall not exceed 15 percent of the 
total estimated Federal assistance (excluding any associated 
administrative costs) provided under sections 403, 406, 407, 408, 410, 
411, 416, and 601 of the Stafford Act.
    (d) Grantee means the government to which a grant is awarded and 
which is accountable for the use of the funds provided. The grantee is 
the entire

[[Page 502]]

legal entity even if only a particular component of the entity is 
designated in the grant award document. For purposes of this part, 
except as noted in Sec. 206.436(g)(1), the State is the grantee.
    (e) Measure means any mitigation measure, project, or action 
proposed to reduce risk of future damage, hardship, loss or suffering 
from disasters. The term measure is used interchangeably with the term 
project in this part.
    (f) Project means any mitigation measure, project, or action 
proposed to reduce risk of future damage, hardship, loss or suffering 
from disasters. The term project is used interchangeably with the term 
measure in this part.
    (g) Sectiom 409 Hazard Mitigation Plan is the hazard mitigation plan 
required under section 409 of the Act as a condition of receiving 
Federal disaster assistance under Public Law 93-288, as amended. This 
hazard mitigation plan is the basis for the identification of measures 
to be funded under the Hazard Mitigation Grant Program.
    (h) State Administrative Plan for the Hazard Mitigation Grant 
Program means the plan developed by the State to describe the procedures 
for administration of the Hazard Mitigation Grant Program.
    (i) Subgrant means an award of financial assistance under a grant by 
a grantee to an eligible subgrantee.
    (j) Subgrantee means the government or other legal entity to which a 
subgrant is awarded and which is accountable to the grantee for the use 
of the funds provided. Subgrantees can be a State agency, local 
government, private non-profit organization, or Indian tribe as outlined 
in Sec. 206.434.
    (k) Supplement means an amendment to the hazard mitigation 
application to add or modify one or more mitigation measures.

[55 FR 35537, Aug. 30, 1990, as amended at 59 FR 24356, May 11, 1994]



Sec. 206.432  Federal grant assistance.

    (a) General. This section describes the extent of Federal funding 
available under the State's grant, as well as limitations and special 
procedures applicable to each.
    (b) Limitations on Federal expenditures. The total of Federal 
assistance under section 404 shall not exceed 15 percent of the total 
estimated Federal assistance (excluding any associated administrative 
costs) provided under sections 403, 406, 407, 408, 410, 411, 416, and 
601 of the Stafford Act. The estimate of Federal assistance under these 
sections shall be based on the Regional Director's estimate of all 
Damage Survey Reports, actual grants, mission assignments, and 
associated expenses.
    (c) Cost sharing. All mitigation measures approved under the State's 
grant will be subject to the cost sharing provisions established in the 
FEMA-State Agreement. FEMA may contribute up to 75 percent of the cost 
of measures approved for funding under the Hazard Mitigation Grant 
Program for major disasters declared on or after June 10, 1993. FEMA may 
contribute up to 50 percent of the cost of measures approved for funding 
under the Hazard Mitigation Grant Program for major disasters declared 
before June 10, 1993. The nonfederal share may exceed the Federal share. 
FEMA will not contribute to costs above the Federally approved estimate.

[55 FR 35537, Aug. 30, 1990, as amended at 59 FR 24356, May 11, 1994]



Sec. 206.433  State responsibilities.

    (a) Grantee. The State will be the Grantee to which funds are 
awarded and will be accountable for the use of those funds. There may be 
subgrantees within the State government.
    (b) Priorities. The State will determine priorities for funding. 
This determination must be made in conformance with Sec. 206.435.
    (c) Hazard Mitigation Officer. The State must appoint a Hazard 
Mitigation Officer, as required under 44 CFR part 206 subpart M, who 
serves as the responsible individual for all matters related to the 
Hazard Mitigation Grant Program.
    (d) Administrative plan. The State must have an approved 
administrative plan for the Hazard Mitigation Grant Program in 
conformance with Sec. 206.437.



Sec. 206.434  Eligibility.

    (a) Applicants. The following are eligible to apply for the Hazard 
Mitigation Program Grant:
    (1) State and local governments;

[[Page 503]]

    (2) Private non-profit organizations or institutions that own or 
operate a private non-profit facility as defined in Sec. 206.221(e);
    (3) Indian tribes or authorized tribal organizations and Alaska 
Native villages or organizations, but not Alaska native corporations 
with ownership vested in private individuals.
    (b) Minimum project criteria. To be eligible for the Hazard 
Mitigation Grant Program, a project must:
    (1) Be in conformance with the hazard mitigation plan developed as a 
requirement of section 409;
    (2) Have a beneficial impact upon the designated disaster area, 
whether or not located in the designated area;
    (3) Be in conformance with 44 CFR part 9, Floodplain Management and 
Protection of Wetlands, and 44 CFR part 10, Environmental 
Considerations;
    (4) Solve a problem independently or constitute a functional portion 
of a solution where there is assurance that the project as a whole will 
be completed. Projects that merely identify or analyze hazards or 
problems are not eligible;
    (5) Be cost-effective and substantially reduce the risk of future 
damage, hardship, loss, or suffering resulting from a major disaster. 
The grantee must demonstrate this by documenting that the project;
    (i) Addresses a problem that has been repetitive, or a problem that 
poses a significant risk to public health and safety if left unsolved,
    (ii) Will not cost more than the anticipated value of the reduction 
in both direct damages and subsequent negative impacts to the area if 
future disasters were to occur. Both costs and benefits will be computed 
on a net present value basis,
    (iii) Has been determined to be the most practical, effective, and 
environmentally sound alternative after consideration of a range of 
options,
    (iv) Contributes, to the extent practicable, to a long-term solution 
to the problem it is intended to address,
    (v) Considers long-term changes to the areas and entities it 
protects, and has manageable future maintenance and modification 
requirements.
    (c) Types of projects. Projects may be of any nature that will 
result in protection to public or private property. Eligible projects 
include, but are not limited to:
    (1) Structural hazard control or protection projects;
    (2) Construction activities that will result in protection from 
hazards;
    (3) Retrofitting of facilities;
    (4) Property acquisition or relocation, as defined in 
Sec. 206.434(d);
    (5) Development of State or local mitigation standards;
    (6) Development of comprehensive hazard mitigation programs with 
implementation as an essential component;
    (7) Development or improvement of warning systems.
    (d) Property acquisition and relocation requirements. A project 
involving property acquisition or the relocation of structures and 
individuals is eligible for assistance only if the applicant enters an 
agreement with the FEMA Regional Director that provides assurances that:
    (1) The following restrictive covenants shall be conveyed in the 
deed to any property acquired, accepted, or from which structures are 
removed (hereafter called in section (d) the property):
    (i) The property shall be dedicated and maintained in perpetuity for 
uses compatible with open space, recreational, or wetlands management 
practices; and
    (ii) No new structure(s) will be built on the property except as 
indicated below:
    (A) A public facility that is open on all sides and functionally 
related to a designated open space or recreational use;
    (B) A rest room; or
    (C) A structure that is compatible with open space, recreational, or 
wetlands management usage and proper floodplain management policies and 
practices, which the Director approves in writing before the 
construction of the structure begins.
    (iii) After completion of the project, no application for additional 
disaster assistance will be made for any purpose with respect to the 
property to any Federal entity or source, and no Federal entity or 
source will provide such assistance.

[[Page 504]]

    (2) In general, allowable open space, recreational, and wetland 
management uses include parks for outdoor recreational activities, 
nature reserves, cultivation, grazing, camping (except where adequate 
warning time is not available to allow evacuation), temporary storage in 
the open of wheeled vehicles which are easily movable (except mobile 
homes), unimproved, previous parking lots, and buffer zones.
    (3) Any structures built on the property according to paragraph 
(d)(1) of this section, shall be floodproofed or elevated to the Base 
Flood Elevation plus one foot of freeboard.
    (e) Inapplicability of the Uniform Relocation Act. The Uniform 
Relocation Assistance and Real Property Acquisition Policies Act of 1970 
does not apply to real property acquisition projects which meet the 
criteria identified below:
    (1) The project provides for the purchase of property damaged by the 
major, widespread flooding in the States of Illinois, Iowa, Kansas, 
Minnesota, Missouri, Nebraska, North Dakota, South Dakota, and Wisconsin 
during 1993;
    (2) It provides for such purchase solely as a result of such 
flooding;
    (3) It is carried out by or through a State or unit of general local 
government;
    (4) The purchasing agency (grantee or subgrantee) notifies all 
potential property owners in writing that it will not use its power of 
eminent domain to acquire the properties if a voluntary agreement is not 
reached;
    (5) The project is being assisted with amounts made available for:
    (i) Disaster relief by the Federal Emergency Management Agency; or
    (ii) By other Federal financial assistance programs.
    (f) Duplication of programs. Section 404 funds cannot be used as a 
substitute or replacement to fund projects or programs that are 
available under other Federal authorities, except under limited 
circumstances in which there are extraordinary threats to lives, public 
health or safety or improved property.
    (g) Packaging of programs. Section 404 funds may be packaged or used 
in combination with other Federal, State, local, or private funding 
sources when appropriate to develop a comprehensive mitigation solution, 
though section 404 funds cannot be used as a match for other Federal 
funds.

[55 FR 35537, Aug. 30, 1990, as amended at 59 FR 24356, May 11, 1994]



Sec. 206.435  Project identification and selection criteria.

    (a) Identification. It is the State's responsibility to identify and 
select hazard mitigation projects. All funded projects must be 
consistent with the State's section 409 hazard mitigation plan. Hazard 
mitigation projects may be identified through the section 409 planning 
process, or through any other appropriate means. Procedures for the 
identification, funding, and management of mitigation projects shall be 
included in the State's administrative plan.
    (b) Selection. The State will establish procedures and priorities 
for the selection of mitigation measures. At a minimum the criteria must 
be consistent with the criteria stated in Sec. 206.434(b) and include:
    (1) Measures that best fit within an overall plan for development 
and/or hazard mitigation in the community, disaster area, or State;
    (2) Measures that, if not taken, will have a severe detrimental 
impact on the applicant, such as potential loss of life, loss of 
essential services, damage to critical facilities, or economic hardship 
on the community;
    (3) Measures that have the greatest potential impact on reducing 
future disaster losses;
    (c) Other considerations. In addition to the selection criteria 
noted above, consideration should be given to measures that are designed 
to accomplish multiple objectives including damage reduction, 
environmental enhancement, and economic recovery, when appropriate.



Sec. 206.436  Application procedures.

    (a) General. This section describes the procedures to be used by the 
State in submitting an application for funding for hazard mitigation 
grants. Under the Hazard Mitigation Grant Program

[[Page 505]]

the State is the grantee and is responsible for processing subgrants to 
applicants in accordance with 44 CFR parts 13 and 206.
    (b) Governor's Authorized Representative. The Governor's Authorized 
Representative serves as the grant administrator for all funds provided 
under the Hazard Mitigation Grant Program. The Governor's Authorized 
Representative's responsibilities as they pertain to procedures outlined 
in this section include providing technical advice and assistance to 
eligible subgrantees, and ensuring that all potential applicants are 
aware of assistance available and submission of those documents 
necessary for grant award.
    (c) Letter of intent to participate. Within 60 days of the disaster 
declaration, the State (Governor's Authorized Representative) will 
notify FEMA in writing of its intent to participate or not participate 
in the Hazard Mitigation Grant Program. States are also encouraged to 
submit a hazard mitigation application within this timeframe so that 
immediate post-disaster opportunities for hazard mitigation are not 
lost.
    (d) Hazard mitigation application. Upon identification of mitigation 
measures, the State (Governor's Authorized Representative) will submit 
its section 404 Hazard Mitigation Application to the FEMA Regional 
Director. The Application will identify one or more mitigation measures 
for which funding is requested. The Application must include a Standard 
Form (SF) 424, Application for Federal Assistance, SF 424D, Assurances 
for Construction Programs if appropriate, and a narrative statement. The 
narrative statement will contain any pertinent project management 
information not included in the State's administrative plan for Hazard 
Mitigation. The narrative statement will also serve to identify the 
specific mitigation meausres for which funding is requested. Information 
required for each mitigation measure shall include the following:
    (1) Name of the subgrantee, if any;
    (2) State or local contact for the measure;
    (3) Location of the project;
    (4) Description of the measure;
    (5) Cost estimate for the measure;
    (6) Analysis of the measure's cost-effectiveness and substantial 
risk reduction, consistent with Sec. 206.434(b);
    (7) Work schedule;
    (8) Justification for selection;
    (9) Alternatives considered;
    (10) Environmental information consistent with 44 CFR part 9, 
Floodplain Management and Protection of Wetlands, and 44 CFR part 10, 
Environmental Considerations;
    (e) Supplements. The application may be amended as the State and 
subgrantees develop the section 409 hazard mitigation plan and continue 
to identify measures to be funded. Amendments to add or modify measures 
are made by submitting supplements to the application. All supplements 
to the application for the purpose of identifying new mitigation 
measures must be submitted to FEMA within 90 days of FEMA approval of 
the section 409 plan. The Regional Director may grant up to a 90 day 
extension to this deadline upon receipt of written justification from 
the State that the extension is warranted. The supplements shall contain 
all necessary information on the measure as described in paragraph (d) 
of this section.
    (f) FEMA approval. The application and supplement(s) will be 
submitted to the FEMA Regional Director for approval. FEMA has final 
approval authority for funding of all projects.
    (g) Exceptions. The following are exceptions to the above outlined 
procedures and time limitations.
    (1) Grant applications. An Indian tribe or authorized tribal 
organization may submit a SF 424 directly to the Regional Director when 
assistance is authorized under the Act and a State is unable to assume 
the responsibilities prescribed in these regulations.
    (2) Time limitations. The time limitation shown in paragraph (c) of 
this section may be extended by the Regional Director when justified and 
requested in writing by the Governor's Authorized Representative.

(Approved by the Office of Management and Budget under OMB Control 
Number 3067-0207)


[[Page 506]]





Sec. 206.437  State administrative plan.

    (a) General. The State shall develop a plan for the administration 
of the Hazard Mitigation Grant Program.
    (b) Minimum criteria. At a minimum, the State administrative plan 
must include the items listed below:
    (1) Designation of the State agency will have responsibility for 
program administration;
    (2) Identification of the State Hazard Mitigation Officer 
responsible for all matters related to the Hazard Mitigation Grant 
Program.
    (3) Determination of staffing requirements and sources of staff 
necessary for administration of the program;
    (4) Establishment of procedures to:
    (i) Identify and notify potential applicants (subgrantees) of the 
availability of the program;
    (ii) Ensure that potential applicants are provided information on 
the application process, program eligibility and key deadlines;
    (iii) Determine applicant eligibility;
    (iv) Conduct environmental and floodplain management reviews;
    (v) Establish priorities for selection of mitigation projects;
    (vi) Process requests for advances of funds and reimbursement;
    (vii) Monitor and evaluate the progress and completion of the 
selected projects;
    (viii) Review and approve cost overruns;
    (ix) Process appeals;
    (x) Provide technical assistance as required to subgrantee(s);
    (xi) Comply with the administrative requirements of 44 CFR parts 13 
and 206;
    (xii) Comply with audit requirements of 44 CFR part 14;
    (xiii) Provide quarterly progress reports to the Regional Director 
on approved projects.
    (c) Format. The administrative plan is intended to be a brief but 
substantive plan documenting the State's process for the administration 
of the Hazard Mitigation Grant Program and management of the section 404 
funds. This administrative plan should become a part of the State's 
overall emergency response or operations plan as a separate annex or 
chapter.
    (d) Approval. The State must submit the administrative plan to the 
Regional Director for approval. Following each major disaster 
declaration, the State shall prepare any updates, amendments, or plan 
revisions required to meet current policy guidance or changes in the 
administration of the Hazard Mitigation Grant Program. Funds shall not 
be awarded until the State administrative plan is approved by the FEMA 
Regional Director.

(Approved by the Office of Management and Budget under OMB control 
number 3067-0208)


[55 FR 35537, Aug. 30, 1990, as amended at 55 FR 52172, Dec. 20, 1990]



Sec. 206.438  Project management.

    (a) General. The State serving as grantee has primary responsibility 
for project management and accountability of funds as indicated in 44 
CFR part 13. The State is responsible for ensuring that subgrantees meet 
all program and administrative requirements.
    (b) Cost overruns. During the execution of work on an approved 
mitigation measure the Governor's Authorized Representative may find 
that actual project costs are exceeding the approved estimates. Cost 
overruns which can be met without additional Federal funds, or which can 
be met by offsetting cost underruns on other projects, need not be 
submitted to the Regional Director for approval, so long as the full 
scope of work on all affected projects can still be met. For cost 
overruns which exceed Federal obligated funds and which require 
additional Federal funds, the Governor's Authorized Representative shall 
evaluate each cost overrun and shall submit a request with a 
recommendation to the Regional Director for a determination. The 
applicant's justification for additional costs and other pertinent 
material shall accompany the request. The Regional Director shall notify 
the Governor's Authorized Representative in writing of the determination 
and process a supplement, if necessary. All requests that are not 
justified shall be denied by the Governor's Authorized Representative. 
In no case will the total amount obligated to the State exceed the 
funding limits set forth in

[[Page 507]]

Sec. 206.432(b). Any such problems or circumstances affecting project 
costs shall be identified through the quarterly progress reports 
required in paragraph (c) of this section.
    (c) Progress reports. The grantee shall submit a quarterly progress 
report to FEMA indicating the status and completion date for each 
measure funded. Any problems or circumstances affecting completion 
dates, scope of work, or project costs which are expected to result in 
noncompliance with the approved grant conditions shall be described in 
the report.
    (d) Payment of claims. The Governor's Authorized Representative 
shall make a claim to the Regional Director for reimbursement of 
allowable costs for each approved measure. In submitting such claims the 
Governor's Authorized Representative shall certify that reported costs 
were incurred in the performance of eligible work, that the approved 
work was completed and that the mitigation measure is in compliance with 
the provisions of the FEMA-State Agreement. The Regional Director shall 
determine the eligible amount of reimbursement for each claim and 
approve payment. If a mitigation measure is not completed, and there is 
not adequate justification for noncompletion, no Federal funding will be 
provided for that measure.
    (e) Audit requirements. Uniform audit requirements as set forth in 
44 CFR part 14 apply to all grant assistance provided under this 
subpart. FEMA may elect to conduct a Federal audit on the disaster 
assistance grant or on any of the subgrants.



Sec. 206.439  Allowable costs.

    (a) General. General policies for determining allowable costs are 
established in 44 CFR 13.22. Exceptions to those policies as allowed in 
44 CFR 13.4 and 13.6 are explained below.
    (b) Eligible direct costs. The eligible direct costs for 
administration and management of the program are divided into the 
following two categories.
    (1) Statutory administrative costs--(i) Grantee. Pursuant to 
406(f)(2) of the Stafford Act, an allowance will be provided to the 
State to cover the extraordinary costs incurred by the State for 
preparation of applications, quarterly reports, final audits, and 
related field inspections by State employees, including overtime pay and 
per diem and travel expenses, but not including regular time for such 
employees. The allowance will be based on the following percentages of 
the total amount of assistance provided (Federal share) for all 
subgrantees in the State under section 404 of the Stafford Act:
    (A) For the first $100,000 of total assistance provided (Federal 
share), three percent of such assistance.
    (B) For the next $900,000, two percent of such assistance.
    (C) For the next $4,000,000, one percent of such assistance.
    (D) For assistance over $5,000,000, one-half percent of such 
assistance.
    (ii) Subgrantee. Pursuant to section 406(f)(1) of the Stafford Act, 
necessary costs of requesting, obtaining, and administering Federal 
disaster assistance subgrants will be covered by an allowance which is 
based on the following percentages of total net eligible costs under 
section 404 of the Stafford Act, for an individual applicant (applicants 
in this context include State agencies):
    (A) For the first $100,000 of net eligible costs, three percent of 
such costs.
    (B) For the next $900,000, two percent of such costs.
    (C) For the next $4,000,000, one percent of such costs.
    (D) For those costs over $5,000,000, one-half percent of such costs.
    (2) State management costs--(i) Grantee. Except for the items listed 
in paragraph (b)(1)(i) of this section, other administration costs shall 
be paid in accordance with 44 CFR 13.22. Costs of State personnel 
(regular time salaries only) assigned to administer the Hazard 
Mitigation Grant Program may be eligible when approved by the Regional 
Director. Such costs shall be shared in accordance with the cost share 
provisions of section 404 of the Act. For grantee administrative costs 
in the Disaster Field Office, the State shall submit a plan for the 
staffing of the Disaster Field Office within 5 days of the opening of 
the office. This staffing plan shall be in accordance with the 
administrative plan requirements of Sec. 206.437. After the close of the 
Disaster Field Office, costs of State personnel

[[Page 508]]

(regular time salaries only) for continuing management of the hazard 
mitigation grants may be eligible when approved in advance by the 
Regional Director. The State shall submit a plan for such staffing in 
advance of the requirement.
    (c) Eligible indirect costs--(1) Grantee. Indirect costs of 
administering the disaster program are eligible in accordance with the 
provisions of 44 CFR part 13 and OMB Circular A-87.
    (2) Subgrantee. No indirect costs of a subgrantee are separately 
eligible because the percentage allowance in paragraph (b)(1)(ii) of 
this section necessary costs of requesting, obtaining and administering 
Federal assistance.



Sec. 206.440  Appeals.

    (a) Subgrantee. The subgrantee may appeal any determination 
previously made related to Federal assistance for a subgrantee. The 
subgrantee's appeal shall be made in writing and submitted to the 
grantee within 60 days after receipt of a notice of the action which is 
being appealed. The appeal shall contain documented justification 
supporting the subgrantee's position.
    (b) Grantee. Upon receipt of an appeal from a subgrantee, the 
grantee shall review the material submitted, make such additional 
investigations as necessary, and shall forward the appeal with a written 
recommendation to the Regional Director within 60 days.
    (c) Regional Director. Upon receipt of an appeal, the Regional 
Director shall review the material submitted and make such additional 
investigations as deemed appropriate. Within 90 days following receipt 
of an appeal, the Regional Director shall notify the grantee, in 
writing, as to the disposition of the appeal or of the need for 
additional information. Within 90 days following the receipt of such 
additional information, the Regional Director shall notify the grantee, 
in writing, of the disposition of the appeal. If the decision is to 
grant the appeal, the Regional Director will take appropriate 
implementing action.
    (d) Associate Director. (1) If the Regional Director denies the 
appeal, the subgrantee may submit a second appeal to the Associate 
Director. Such appeals shall be made in writing, through the grantee and 
the Regional Director, and shall be submitted not later than 60 days 
after receipt of notice of the Regional Director's denial of the first 
appeal. The Associate Director shall render a determination on the 
subgrantee's appeal within 90 days following receipt of the appeal or 
shall make a request for additional information. Within 90 days 
following the receipt of such additional information, the Associate 
Director shall notify the grantee, in writing, of the disposition of the 
appeal. If the decision is to grant the appeal, the Regional Director 
will be instructed to take appropriate implementing action.
    (2) In appeals involving highly technical issues, the Associate 
Director, at his/her discretion, may ask an independent scientific or 
technical group or person with expertise in the subject matter of the 
appeal to review the appeal in order to obtain the best possible 
evaluation. In such cases, the 90 day time limit will run from the 
submission of the technical report.
    (e) Director. (1) If the Associate Director denies the appeal, the 
subgrantee may submit an appeal to the Director of FEMA. Such appeals 
shall be made in writing, through the grantee and the Regional Director, 
and shall be submitted not later than 60 days after receipt of notice of 
the Associate Director's denial of the second appeal.
    (2) The Director shall render a determination on the subgrantee's 
appeal within 90 days following receipt of the appeal or shall make a 
request for additional information if such is necessary. Within 90 days 
following the receipt of such additional information, the Director shall 
render a determination and notify the grantee, in writing, of the 
disposition of the appeal. If the decision is to grant the appeal, the 
Regional Director will be instructed to take appropriate implementing 
action.
    (3) In appeals involving highly technical issues, the Director may, 
at his/her discretion, submit the appeal to an independent scientific or 
technical person or group having expertise in the subject matter of the 
appeal for advice and recommendation. Before making the selection of 
this person or group, the Director may consult with the grantee and/or 
the subgrantee.

[[Page 509]]

    (4) The Director may also submit appeals which he/she receives to 
persons who are not associated with FEMA's Disaster Assistance Programs 
office for recommendations on the resolution of appeals.
    (5) Within 60 days after the submission of a recommendation made 
pursuant to paragraph (d) (3) and (4) of this section, the Director 
shall render a determination and notify the grantee of the disposition 
of the appeal.



PART 207--GREAT LAKES PLANNING ASSISTANCE--Table of Contents




Sec.
207.1  General.
207.2  Definitions.
207.3  Eligibility.
207.4  Application procedures.
207.5  Project management.
207.6  Technical assistance.

    Authority: Section 202, Title II, Public Law 100-707, 102 Stat. 4711 
(33 U.S.C. 426p. note).

    Source: 55 FR 7329, Mar. 1, 1990, unless otherwise noted.



Sec. 207.1  General.

    This subpart provides requirements and establishes general 
procedures for administration of one-time grants to States under the 
provisions of section 202 of the Great Lakes Planning Assistance Act of 
1988. The Act authorizes the Director of the Federal Emergency 
Management Agency (FEMA) to provide assistance to the Great Lakes States 
to reduce and prevent damage attributable to high water levels in the 
Great Lakes. The assistance would include a one-time grant of not more 
than $250,000 for preparation of mitigation and emergency plans, 
coordinating available State and Federal assistance, developing and 
implementing measures to reduce damages due to high water levels, and 
assisting local governments in developing and implementing plans to 
reduce damages. Each State receiving a grant shall match it with an 
amount equal to 25 percent of the Federal grant. The grant should be 
used to supplement and extend existing activities and programs, to the 
extent possible.



Sec. 207.2  Definitions.

    (a) Applicant means a Great Lakes State.
    (b) Grant means an award of financial assistance.
    (c) Grantee means the State government to which a grant is awarded 
and which is accountable for the use of the funds provided. The grantee 
is the entire legal entity even if only a particular component of the 
entity is designated in the grant award. For the purposes of this 
regulation, the State is the grantee.
    (d) Grant application means the official request for funding under 
the Great Lakes Planning Assistance Grant program.
    (e) Great Lakes means Lake Ontario, Lake Erie, Lake Huron, Lake 
Michigan, Lake Superior, and Lake St. Clair, to the extent those lakes 
are subject to the jurisdiction of the United States.
    (f) Great Lake States means the States of Illinois, Indiana, 
Michigan, Minnesota, New York, Ohio, Pennsylvania, and Wisconsin.
    (g) High water includes static water level, wind generated waves, 
and runup.
    (h) Nonstructural measures, as the term is used in part 207, are 
those actions taken to protect people and property from the effects of a 
hazard, but do not modify the nature, frequency, or intensity of the 
hazard. They include measures such as setbacks, land use and development 
standards, flood-proofing, and elevation or relocation of properties and 
structures at risk.
    (i) Structural measures, as the term is used in part 207, are those 
actions taken to protect people and property from the effects of a 
hazard by modifying the nature, frequency or intensity of a hazard. They 
include measures such as floodwalls, levees, retaining walls, jetties, 
groins and other engineering works designed to control flooding and 
erosion.
    (j) Subgrant means an award of financial assistance under a grant by 
a grantee to an eligible subgrantee.
    (k) Subgrantee means the government or other legal entity to which a 
subgrant is awarded and which is accountable to the grantee for the use 
of the funds provided.

[[Page 510]]

    (l) Technical proposal means the initial submission by the State to 
FEMA indicating interest in the program and identifying projects for 
funding.



Sec. 207.3  Eligibility.

    (a) Applicant eligibility. Each of the eight Great Lakes States 
(Illinois, Indiana, Michigan, Minnesota, New York, Ohio, Pennsylvania, 
and Wisconsin) is eligible for this grant program. The State will be the 
grantee to which funds are awarded and will be accountable for the use 
of those funds. There may be subgrantees within the State.
    (b) Project eligibility. Each State shall identify projects and 
programs in the grant application and technical proposal. Projects and 
programs funded through this grant must comply with all applicable laws 
and regulations, including 44 CFR part 9, Floodplain Management and 
Protection of Wetlands, and 44 CFR part 10, Environmental 
Considerations. Categories of projects and programs eligible for funding 
under this grant program are:
    (1) Preparation of plans for mitigation, warning, emergency 
operations, and emergency assistance. These plans must meet the 
following conditions, where applicable.
    (i) All plans should be specific to reducing and/or preventing 
damage due to high water.
    (ii) Mitigation plans should identify specific measures or 
recommendations to limit and/or prevent damages.
    (iii) Emergency plans should identify measures to protect lives, 
property, and facilities.
    (iv) All plans should be part of an overall State program to 
evaluate hazards and develop recommendations regarding the Great Lakes.
    (2) Coordination of available State and Federal assistance. This 
task would be accomplished by determining the availability of funds and 
programs (at the Federal, State, local, and private level) and 
identifying how to most effectively use those resources to protect 
against future damages.
    (3) Development and implementation of nonstructural measures to 
reduce or prevent damages. These measures could include the 
establishment of setback or dune preservation requirements and/or other 
conditions on construction and reconstruction of public and private 
facilities, development of enforcement procedures for nonstructural 
measures, and mapping flood and erosion hazard areas.
    (4) Assist local governments in developing and implementing plans 
for nonstructural reduction and prevention of damages. This assistance 
would include providing a mechanism for local governments to apply for 
the grant program, assisting local governments in implementing 
mitigation measures, and providing technical assistance to local 
governments in developing nonstructural mitigation measures.
    (c) Duplication of programs. Great Lakes Planning Assistance Grants 
cannot be used as a substitute or replacement to fund projects or 
programs that are available under other Federal authorities.
    (d) Packaging of programs. Great Lakes Planning Assistance Grants 
can be packaged or used in combination with other Federal, State, local, 
or private funding sources where appropriate. However, the Grants cannot 
be used to meet the non-Federal cost share requirements of other Federal 
programs.

(Approved by the Office of Management and Budget under OMB control 
number 3067-0203)



Sec. 207.4  Application procedures.

    (a) General. Technical proposals were required to have been filed by 
November 23, 1989.
    (b) Grant application. A formal grant application will not be 
required until such time as funds are appropriated for this grant 
program. At that time, the State will be given the opportunity to review 
and revise the technical proposal. The formal grant application will 
consist of the revised technical proposal and appropriate reports in 
accordance with 44 CFR part 13.
    (b) Cost share requirement. States receiving a grant shall match the 
grant with an amount no less than 25 percent of the amount of the 
Federal grant. Identification of allowable costs and rules for cost 
sharing are included in 44 CFR 13.22 and 13.24.

(Approved by the Office of Management and Budget under OMB control 
number 3067-0203)


[[Page 511]]





Sec. 207.5  Project management.

    The State serving as grantee has primary responsibility for project 
management and accountability of funds as indicated in 44 CFR part 13. 
The State is responsible for ensuring that subgrantees meet all program 
requirements.



Sec. 207.6  Technical assistance.

    (a) General. Requests from a State to FEMA for technical assistance 
in carrying out any activity of this grant program shall be made by the 
Governor or his/her designated representative to the Regional Director 
(reference Sec. 202(c) of the Act).
    (b) Content of request. The request for technical assistance shall 
indicate as specifically as possible the objectives, nature, and 
duration of the requested assistance; the professional disciplinary 
capabilities needed; the recipient agency or organization within the 
State; the manner in which such assistance is to be utilized; and any 
other information needed for a full understanding of the need for such 
requested assistance.
    (c) State participation. The request for assistance requires 
participation by the State in the technical assistance process. As part 
of its request for such assistance, the State shall agree to facilitate 
coordination among FEMA and all subgrantees in need of assistance.

(Approved by the Office of Management and Budget under OMB control 
number 3067-0203)



PARTS 208-219  [RESERVED]






PART 220--TEMPORARY RELOCATION ASSISTANCE--Table of Contents




                          Temporary Relocation

Sec.
220.1  Purpose.
220.2  Definitions.
220.3  Program intent.
220.4  Duplication of benefits.
220.5  Site specific plan.
220.6  Applications.
220.7  Eligibility criteria.
220.8  Eligible categories of assistance.
220.9  Ineligible categories.
220.10  Site security.
220.11  Fair market rent guidelines.
220.12  Transfer of occupants.
220.13  Personal property acquisition.
220.14  Floodplain management guidelines.
220.15  Effective date of assistance.
220.16  Termination of assistance.
220.17  Cost sharing.
220.18  State administration of temporary relocation assistance.
220.19  Reports.

    Authority: 42 U.S.C. 9601 et seq.; E.O. 12580, 3 CFR, 1987 Comp., p. 
193.

    Source: 54 FR 3034, Jan. 23, 1989, unless otherwise noted.

                          Temporary Relocation



Sec. 220.1  Purpose.

    This regulation prescribes the policies to be followed by the 
Federal Emergency Management Agency (FEMA) or any State or local 
government when implementing Temporary Relocation Assistance under the 
Comprehensive Environmental Response, Compensation and Liability Act of 
1980 (CERCLA), as amended, 42 U.S.C. 9601, et seq., also known as 
Superfund.



Sec. 220.2  Definitions.

    Cost Share means the portion of the allowable project cost which is 
not derived from Federal assistance.
    Evacuation means the emergency relocation of threatened individuals 
from an area. This activity is normally carried out by the State as part 
of its public health and safety responsibility.
    Fair market rent means a reasonable amount to pay in the local area 
for the size and type of accommodations provided. (The formula is 
provided in Sec. 220.11of this part.)
    Household means the residents of the pre-incident residence who are 
offered Temporary Relocation Assistance. It includes any authorized 
additions during the temporary housing period, such as children, 
spouses, or part-time residents who were not present at the time of the 
announcement, but who are expected to return during the temporary 
housing period.
    Occupant means an eligible applicant residing in temporary housing.
    Primary residence means the dwelling where the applicant normally 
resides during the major portion of the calendar year, or a dwelling 
which is required because of proximity to employment.

[[Page 512]]

    Transient accommodations means hotels, motels or other similar 
accommodations which are utilized to assist eligible applicants who 
require temporary housing for only a short period of time, or who 
require such assistance pending provision of another temporary housing 
resource. Transient accommodations may be provided for up to 30 days 
unless this period is extended by the FEMA Regional Director or official 
designee.



Sec. 220.3  Program intent.

    Temporary Relocation Assistance is provided to eligible individuals, 
identified by EPA, who are displaced from their primary residence in 
connection with a hazardous substance response action, to relocate for 
their own health and safety, and/or to allow the EPA, or its agents to 
conduct clean-up activities. It is not intended to totally compensate 
these individuals for all expenses and losses associated with 
contamination of the site on which they reside. Assistance covers 
reasonable living expenses that are additional to the living expenses 
which existed prior to the relocation. Applicants are eligible only for 
categories of assistance where additional expenses are actually 
incurred. Nine categories of eligible assistance, designed to pay costs 
directly related to the temporary relocation program include: (a) 
Temporary housing in locally available private rentals; (b) subsistence 
payments for individuals placed in transient accommodations; (c) 
furniture assistance when individuals are placed in unfurnished 
temporary housing, or when the furniture at the permanent residence is 
contaminated; (d) transportation of household goods to temporary and 
back to permanent residence; (e) utility subsidy covering the costs for 
primary residence; (f) utility connection costs at the temporary housing 
residence; (g) kennel costs; (h) personal property purchase or 
decontamination costs; and (i) other expenses directly related to the 
relocation. The establishment of these categories of assistance does not 
prohibit advance of funds or establishment of fixed funding rates for 
certain categories of assistance, when it is determined to be 
appropriate and cost-effective.



Sec. 220.4  Duplication of benefits.

    FEMA has determined that Temporary Relocation Assistance shall not 
be provided to an applicant if such assistance or its equivalent is 
received from any other source. This also prohibits duplication of 
benefits by receipt of temporary relocation assistance, and permanent 
relocation under CERCLA, or any disaster assistance. If any State or 
local government or volunteer agency is providing assistance for the 
same purpose as temporary relocation assistance, temporary relocation 
assistance under CERCLA, as amended, shall not begin until such other 
assistance is terminated. In the instance of insured applicants, 
assistance shall not be provided if insurance proceeds are available, 
unless there is a delay by the insurer in determining whether the 
proceeds will be available; there is ample reason to believe that 
payment of the proceeds may be significantly delayed; such proceeds have 
been exhausted; or, the proceeds are insufficient to provide the full 
cost of relocation benefits. Prior to provision of assistance, the 
insured applicant shall agree to repay FEMA from insurance proceeds he/
she receives for additional living expenses, an amount equivalent to the 
assistance provided, or that portion of insurance proceeds, whichever is 
less.



Sec. 220.5  Site specific plan.

    Each FEMA regional office must prepare a site specific Temporary 
Relocation Plan to be approved by the Regional Director or his or her 
official designee. The approved plan shall be submitted to the Assistant 
Associate Director, Disaster Assistance Programs (DAP), for review 
within seven days of signing an IAG with EPA. The Assistant Associate 
Director, DAP, or official designee, assumes Regional Director 
responsibilities when Headquarters is implementing temporary relocation. 
The requirements of the plan are outlined in Sec. 220.18.



Sec. 220.6  Applications.

    Applications for Superfund Temporary Relocation Assistance under 
CERCLA, as amended, shall be accepted throughout the relocation period 
identified by EPA. Members of each household shall be included on a 
single

[[Page 513]]

application. Household members shall be provided a safe, sanitary and 
secure residence.

(Approved by the Office of Management and Budget under OMB Control 
Number 3067-0168)



Sec. 220.7  Eligibility criteria.

    Temporary Relocation Assistance may be made available to those 
individuals displaced from this primary residence as a result of a 
determination by EPA that relocation is necessary. Temporary Relocation 
Assistance for a particular site shall be available only in the area 
identified by EPA through property addressed, site map or names of 
families.



Sec. 220.8  Eligible categories of assistance.

    The following categories of assistance may be provided, based on 
individual needs:
    (a) Temporary housing. This may include locally availble private 
rentals (houses and apartments), including hotels/motels (transient or 
other accommodations). Sharing of accommodations with family and friends 
is an allowable form of assistance only when an eligible applicant 
elects it as his/her form of assistance. FEMA will pay fair market value 
for existing resources in accordance with the criteria in Sec. 220.11 of 
this part. When authorized by the FEMA Regional Director, security 
deposits may be paid. Pet fees/deposits are authorized. All deposits 
must be recovered from the owner/agent or occupant, before or at the 
time that assistance is terminated. Cleaning fees and laundry fees at 
the temporary housing residence are the responsibility of the 
occupant(s).
    (b) Subsistence payment. A daily allotment may be provided to cover 
additional costs such as food and laundry expenses, when individuals are 
placed in hotels/motels or other transient accommodations. Allotment 
shall be based on the Federal per diem rate, when FEMA administers the 
program.
    (c) Furniture assistance. When it is impractical to move furniture 
to the temporary housing or when EPA has determined that furniture is 
contaminated, essential furniture may be provided to eligible occupants 
of unfurnished temporary housing. Furniture items are provided on a loan 
basis for the duration of the temporary relocation. Items provided shall 
be of average construction and quality. Luxury items shall not be 
provided. Furniture rental assistance may be handled by direct 
reimbursement, or advancement of funds. Receipts must be provided by the 
applicant.

Items are to be provided in accordance with family size and needs, and 
include:

1 Sofa
1 Living room chair
1 Coffee table
2 End tables
2 Table lamps
1 Dining table
\1\ Dining chairs
1 Range
1 Refrigerator
\1\ Double bed (Mattress, box springs, frame)
\1\ Single bed (Mattress, box springs, frame)
\1\ Crib w/mattress
\1\ Bunk bed set
1 Night table (per bedroom)
1 Table lamp (per bedroom)
\1\ Chest of drawers
1 Television (Maximum 
19&)

    \1\ One per person.

    (d) Expenses for transportation of household goods. This shall 
include the reasonable cost of moving to temporary housing and back to 
the primary residence or to another permanent residence. It shall also 
include one move to a permanent residence when the individuals displaced 
decide to forego a move to temporary housing and move to permanent 
housing instead.
    (e) Utility subsidy. Costs for essential utilities at the primary 
residence, only during the period of temporary housing, may be 
authorized since these costs are additional to utility costs at the 
temporary housing resource, which are the responsibility of the 
occupant. Payment for essential utilities shall include gas, 
electricity, oil, water, sewer, and telephone. If cost effective, 
winterization costs may be paid as an alternative or in conjunction with 
the utility subsidy. this must be approved by the FEMA Regional Director 
or his/her representative. When permanent relocation is also authorized, 
utilities at the unoccupied primary residence should be disconnected, 
when practical,

[[Page 514]]

eliminating the need for utility subsidy.
    (f) Utility connection costs. If the costs of connecting and/or 
disconnecting utilities cannot be waived by utility companies, the costs 
for connecting or disconnecting the essential utilities at the temporary 
housing residence shall be paid. Also, if cost effective when compared 
to utilities subsidy, reconnection costs shall be paid at the primary 
residence.
    (g) Kennel costs. When necessary, payment of actual reasonable 
kennel and pasturing costs shall be authorized.
    (h) Personal property. Contaminated personal property shall be 
decontaminated or acquired by FEMA or its agent when EPA specifically 
determines the need for decontamination or acquisition as part of 
temporary relocation. Only reasonable actual expenditures shall be paid 
for decontamination of property, excluding applicant labor.
    (i) Other expenses directly related to relocation. When appropriate, 
the Regional Director may recommend that such other expenses directly 
related to the temporary relocation become eligible. This request must 
be approved by the Assistant Associate Director, Disaster Assistance 
Programs.



Sec. 220.9  Ineligible categories.

    The following items shall not be eligible for payment under 
Temporary Relocation Assistance:
    (a) Rental payments or mortgage payments for homes owned by the 
eligible applicant;
    (b) Business losses. This does not prohibit use of a temporary 
housing residence for a home business. However, additional costs 
necessitated by the operation of a home business are not authorized;
    (c) Personal transportation costs;
    (d) Insurance premiums for the temporary housing unit and the 
primary residence; and
    (e) Cleaning fees and laundry fees at the temporary relocation 
residence.



Sec. 220.10  Site security.

    The EPA is responsible for site security.



Sec. 220.11  Fair market rent guidelines.

    At each site, fair market rent guidelines for each size residence 
shall be established by averaging the cost of available residences per 
bedroom size for each locality where temporary housing will be provided. 
Where privately owned mobile homes are to be used, a separate guideline 
shall also be developed. Guidelines for hotel, motel and other short-
term resources shall be developed only when there is a substantial 
variance in price among the available supply. The purpose of these fair 
market rent guidelines is to prevent development of an inflated rental 
market resulting from the incident and to insure cost-effectiveness. 
These guidelines reflect the desired maximum payment. Use of resources 
more costly than the guidelines may be authorized by the FEMA Regional 
Director or official designee for full payment only when other existing 
resources are not available. When less than 10 families are being 
relocated, fair market rent guidelines may be established by a less 
time-consuming means, e.g., using an estimate provided by real estate 
agencies or conducting a sampling instead of a comprehensive survey.



Sec. 220.12  Transfer of occupants.

    (a) Transfers requested by occupants. Occupants who request to 
transfer from one temporary housing unit to another, solely for their 
own convenience or for reasons necessitated through their fault, shall 
be responsible for all expenses associated with the move, including any 
increase in temporary housing rent.
    (b) Transfers for other reasons. If FEMA initiates a transfer or if 
a transfer is necessitated for reasons which are not the fault of an 
occupant, all essential costs of the move shall be paid by FEMA. Such 
transfers shall be conducted in a manner that will cause minimum 
inconvenience to the occupants.



Sec. 220.13  Personal property acquisition.

    Personal property identified by EPA as contaminated and unable to 
undergo a successful process of decontamination will be purchased. Such 
purchase will be contingent upon authorization

[[Page 515]]

in the site-specific interagency agreement. Possession or ownership of 
the acquired personal property shall pass directly to EPA from the 
seller. The acquisition of personal property shall be conducted along 
the following lines:
    (a) An inventory of eligible personal property shall be prepared to 
include the manufacturer's name, model number and other information 
which might assist in establishing the quality and value of the property 
to be acquired.
    (b) Payment shall be made for replacement value of similar items. 
With regard to valuable antiques, owners shall be paid whatever benefits 
they would have received if this loss had been exclusively covered by 
their homeowners insurance policy. If they do not have homeowners 
insurance for personal property, owners shall be paid the cost of 
replacement with an item of similar quality with the same functional 
use.
    (c) An appraisal shall be required in all instances.
    (d) Based on the appraisal, FEMA shall present the initial offer to 
acquire to the temporary relocation applicant. The offer to acquire 
shall be in writing and will include a list of items to be purchased. 
The total value of the listed items will be presented in the offer.
    (e) A written sales contract shall specify what is being purchased 
and the terms and conditions of the sale, as well as the 
responsibilities of the seller.
    (f) When negotiations fail, after a reasonable effort by both 
parties, an individual who disputes the amount of the offer to acquire 
shall have the right to submit a written appeal to the Regional 
Director. The Regional Director shall make a final decision concerning 
the offer to acquire within 10 business days from receipt of the written 
appeal. The decision of the Regional Director is final.
    (g) FEMA may not move an applicant's contaminated furniture to the 
temporary relocation residence.
    (h) FEMA shall not be responsible for management and/or disposition 
of the acquired property.



Sec. 220.14  Floodplain management guidelines.

    FEMA has determined that placement of families in existing resources 
under Temporary Relocation Assistance is exempt from the floodplain 
management requirements of part 9 in 44 CFR 9.5(c)(14), Floodplain 
Management and Protection of Wetlands. However, efforts shall be made to 
use existing resources outside of the floodplain when possible and 
families shall be notified in writing when they are referred by FEMA to 
existing resources which are in the floodplain. Referrals shall not be 
made to existing resources in the floodplain within communities which 
are not participating in the National Flood Insurance Program.



Sec. 220.15  Effective date of assistance.

    The effective date of assistance is the date the applicant obtains 
his/her own authorized accommodations or the date FEMA provides other 
relocation assistance. Temporary Relocation Assistance may be provided 
as of the date identified by EPA in the FEMA/EPA Interagency Agreement.



Sec. 220.16  Termination of assistance.

    Termination of temporary housing may be initiated with a 30-day 
written notice, after which the occupant shall be liable for such 
additional charges as are deemed appropriate by the Regional Director 
including, but not limited to, the fair market rental for the temporary 
housing residence. Termination may be in the form of eviction from 
temporary housing (if FEMA leased the housing) or termination of 
financial assistance (if cash payment is made to the occupant).
    (a) Grounds for termination. Temporary housing (including transient 
accommodations) may be terminated for reasons, including, but not 
limited to, the following:
    (1) A determination has been made by EPA that the residence from 
which the occupant was displaced is now available for occupancy.
    (2) FEMA has determined that the temporary housing occupant has 
failed to comply with the terms of the lease or reimbursement agreement.

[[Page 516]]

    (3) An offer for permanent acquisition of the housing from which the 
individual has been displaced has been made (and the time period for 
temporary housing allocated by FEMA's permanent relocation plan for the 
specific location involved has passed). This includes an offer of 
relocation assistance, if appropriate.
    (4) The temporary housing occupant has failed to take due care of 
the temporary dwelling.
    (5) FEMA has determined that temporary housing was obtained through 
misrepresentation or fraud.
    (6) The temporary housing occupant has failed to pay utilities or 
other charges, responsibility for which has been assigned by the lease 
or reimbursement agreement.
    (7) FEMA has determined that the temporary housing occupant has 
permanently relocated to a new location.
    (b) Termination procedures. These procedures shall be utilized in 
all instances, except when a State is administering the Temporary 
Relocation Assistance Program. States shall be subject to their own 
procedures provided they afford the occupant(s) due process safeguards 
described in paragraph (b)(5)(iv) of this section.
    (1) Notification of occupants. Written notice shall be given by FEMA 
(or the entity designated to administer the program) to the occupant(s) 
at least 30 days prior to the proposed termination of assistance. This 
notice shall specify: The reasons for termination of assistance/
occupancy; the date of termination, which shall not be less than 30 days 
after receipt of the notice; the administrative procedure available to 
the occupant(s) if he/she wishes to dispute the action; and the 
occupant's liability after the termination date for additional charges.

    Exception: Where the temporary housing occupants have been informed 
in writing, prior to receiving assistance from FEMA that the duration of 
the temporary housing assistance will be 30 days or less, there is no 
requirement for a written notice. The notice of the limited duration of 
such assistance or occupancy will also serve as notice of termination of 
the assistance for occupancy. Those occupants will be notified by 
telephone or personal conversation as to the exact date of termination 
of assistance. If occupying FEMA-leased housing, occupants shall be 
required to leave within 24 hours from the time of the conversation 
regarding termination.

    (2) Filing of appeal. If the occupant desires to dispute the 
termination of temporary housing assistance, upon receipt of the written 
notice specified in paragraph (b)(1) of this section, he/she shall 
present the appeal in writing to the appropriate FEMA office in person 
or by mail within 5 business days. The appeal must be signed by the 
occupant and state the reasons why the assistance or occupancy should 
not be terminated. If a hearing is desired, the appeal should so state.
    (3) Response to appeal. If a hearing pursuant to paragraph (b)(2) of 
this section has not been requested, the occupant will be deemed to have 
waived the right to a hearing. Under such circumstances, the appropriate 
FEMA official shall deliver or mail a written response to the occupant 
within 5 business days after the receipt of the appeal.
    (4) Request for a hearing. If the occupant requests a hearing 
pursuant to paragraph (b)(2) of this section, FEMA shall schedule a 
hearing date within 10 days from the receipt of the appeal, at a time 
and place reasonably convenient to the occupant, who shall be notified 
promptly thereof in writing. The notice of hearing shall specify the 
procedure governing the hearing.
    (5) Hearing--(i) Hearing officer. The hearing shall be conducted by 
a Hearing Officer who shall be designated by the FEMA Regional Director, 
and who shall not have been involved with the decision to terminate the 
occupant's temporary housing assistance, nor be a subordinate of any 
individual who was so involved.
    (ii) Due process. The occupant shall be afforded a fair hearing and 
provided the basic safeguards of due process, including cross-
examination of the responsible official(s), access to the documents on 
which FEMA is relying, the right to counsel at his/her expense, the 
right to present evidence, and the right to a written decision.
    (iii) Failure to appear. If an occupant fails to appear at a 
hearing, the Hearing Officer may make a determination that the occupant 
has waived his/her right to a hearing, or may, for good

[[Page 517]]

cause shown, postpone the hearing for no more than 5 business days.
    (iv) Proof. At the hearing, the occupant must first attempt to 
establish that continued assistance is appropriate; thereafter, FEMA 
must sustain the burden of proof in justifying that the termination is 
appropriate. The occupant shall have the right to present evidence and 
arguments in support of his/her complaint, to disprove evidence relied 
on by FEMA, and to confront in a reasonable manner and cross-examine all 
witnesses on whose testimony or information FEMA relies. The hearing 
shall be conducted by the Hearing Officer and any evidence pertinent to 
the facts and issues raised may be received without regard to its 
admissibility under rules of evidence employed in formal judicial 
proceedings.
    (6) Decision. The decision of the Hearing Officer shall be based 
solely upon applicable Federal and State law, and FEMA regulations and 
requirements promulgated thereunder. The Hearing Officer shall prepare a 
written decision setting forth a statement of findings and conclusions 
together with the reasons therefore, concerning all material issues 
raised by the complainant within five business days after the hearing. 
The decision of the Hearing Officer shall be binding on FEMA which shall 
take all actions necessary to carry out the decision or refrain from any 
actions prohibited by the decision, unless the FEMA Regional Director 
determines and notifies the complainant in writing within 30 days, or 
such additional time as FEMA may for good cause allow, that the decision 
of the Hearing Officer is not supportable.
    (i) If the determination is to evict, the decision shall include a 
notice to the occupant that he/she must vacate the premises within three 
days of receipt of the written notice or on the termination, as required 
in paragraph (b) of this section, whichever is later. If the occupant 
does not quit the premises, appropriate action shall be taken and, if 
suit is brought, the occupant may be required to pay court costs and 
attorney fees.
    (ii) If the determination is to terminate financial assistance, such 
assistance shall be terminated in accordance with the original notice 
given pursuant to paragraph (b)(1) of this section. If the occupant is 
required to give a specific number of days notice to the landlord which 
exceeds the number of days in the termination notice, the Regional 
Director, may approve the payment of rent for this period of time if 
requested by the occupant.



Sec. 220.17  Cost sharing.

    State cost sharing, during a temporary relocation, will be required 
when the temporary relocation is determined to be a remedial action. The 
cost sharing policies are outlined in the Superfund Cost Share 
Eligibility Criteria for Permanent and Temporary Relocation, 44 CFR part 
222.



Sec. 220.18  State administration of temporary relocation assistance.

    When administering this program, the State must comply with FEMA 
regulations and policies. The State shall maintain adequate 
documentation to enable analysis of the program in accordance with 
regulations, manuals, handbooks and guidance.
    (a) Site specific plan. When it is agreed that a State will 
adminster all or part of temporary relocation activity, the State must 
submit a site-specific Temporary Relocation Assistance Plan for approval 
by the Regional Director or official designee within seven days of the 
signing of the FEMA/State Cooperative Agreement. This plan shall include 
the items listed below, as appropriate:
    (1) Budget and estimated outlay schedule, and allocation advice;
    (2) Time frames within which tasks will be completed;
    (3) Assignment of relocation responsibilities to State and/or local 
officials or agencies;
    (4) Method for notifying affected residents and taking applications;
    (5) Method for developing fair market rent guidelines;
    (6) Requirement for transient accommodations;
    (7) Amount of food subsidy and the method for development of same;
    (8) Policy for paying utility subsidy and/or connection costs;
    (9) Method for providing site security;

[[Page 518]]

    (10) Method for payment for acquisition of contaminated personal 
property, when required by FEMA;
    (11) Termination procedures;
    (12) Contracting procedures;
    (13) Quality control procedures;
    (14) Documentation and control system provisions; and
    (15) Arrangements for program review.

(Approved by the Office of Management and Budget under OMB Control 
Number 3067-0156)

    (b) Authorized costs. All expenditures associated with administering 
the relocation activity are authorized if in compliance with this part, 
applicable FEMA/State Cooperative Agreements, OMB Circular A-87 Revised, 
Costs Principles for State and Local Governments (46 FR 9548), OMB 
Circular A-102 Revised and FEMA regulations on Uniform Administrative 
Requirements for Grants and Cooperative Agreements (44 CFR part 13), and 
other FEMA regulations, as applicable.
    (c) Federal monitoring and oversight. The Regional Director shall 
monitor State-administered activities since he/she remains responsible 
for the delivery of Temporary Relocation Assistance. In addition, policy 
guidance and interpretations to meet specific needs of an incident shall 
be provided through the oversight function. As determined necessary by 
FEMA, monitoring and oversight functions shall include on-site program 
reviews.
    (d) Technical assistance. The Regional Director shall provide 
technical assistance as necessary to support State-administered 
operations through training, policies and regulations and through the 
use of personnel for technical assistance to the State or local staff.
    (e) Audits. The State shall conduct a program review of each 
operation. All site-specific activities are subject to Federal audit.



Sec. 220.19  Reports.

    The Associate Director for State and Local Programs and Support and 
the Regional Director may require from field operations such reports, 
plans and evaluations as they deem necessary to carry out their 
responsibilities under these regulations.



PART 221--PERMANENT RELOCATION ASSISTANCE--Table of Contents




                           Subpart A--General

Sec.
221.1  Purpose.
221.2  Definitions.
221.3  Program intent.
221.4  Eligibility criteria.
221.5  Duplication of benefits.
221.6  FEMA administration.
221.7  State commitments.
221.8  State administration.

            Subpart B--Real and Personal Property Acquisition

221.9  Real property acquisition.
221.10  Personal property acquisition.

                    Subpart C--Relocation Assistance

221.11  Relocation assistance.

           Subpart D--Payments for Moving and Related Expenses

221.12  Moving and related expenses.

                 Subpart E--Replacement Housing Payments

221.13  Replacement housing payments.

                         Subpart F--Mobile Homes

221.14  Mobile homes.

    Authority: 42 U.S.C. 9601 et seq.; E.O. 12580, 3 CFR, 1987 Comp., p. 
193; 49 CFR part 24.

    Source: 54 FR 11951, Mar. 23, 1989, unless otherwise noted.



                           Subpart A--General



Sec. 221.1  Purpose.

    This part prescribes the policies to be followed by the Federal 
Emergency Management Agency (FEMA), other Federal Agencies, any State, 
or other entity when providing permanent relocation assistance under the 
Comprehensive Environmental Response, Compensation and Liability Act of 
1980 (CERCLA), as amended, 42 U.S.C. 9601 et seq. also known as 
Superfund. This regulation is to be used in concert with the regulations 
which implement the Uniform Relocation Assistance and Real Property 
Acquisition Act of 1970,

[[Page 519]]

as amended. Those Regulations are located at 49 CFR part 24, (the 
Uniform Regulations).



Sec. 221.2  Definitions.

    For the purpose of this part:
    (a) CERCLA or Superfund is the Comprehensive Environmental Response, 
Compensation and Liability Act of 1980, as amended.
    (b) Cooperative agreement is an agreement between FEMA and a State 
that outlines the roles and responsibilities of the parties in 
implementing a CERCLA permanent relocation project.
    (c) Determination is the decision EPA makes that permanent 
relocation of residents, businesses, and community facilities is 
required under CERCLA.
    (d) Disaster assistance means assistance provided as a result of 
major disaster declaration or emergency declaration under the Disaster 
Relief Act of 1974, Public Law 93-288.
    (e) Fair Market Value is the price which a property will bring in a 
competitive and open market, the buyer and seller each acting prudently 
and knowledgeably. In permanent relocation programs under CERCLA, the 
fair market value is the value a willing buyer would have paid and a 
willing seller would have sold a property for the absence of hazardous 
material contamination.
    (f) Interagency agreement is the agreement between the EPA and FEMA 
that identifies those property owners eligible for permanent relocation 
assistance, and provides funding to FEMA to cover the cost of the 
relocation.
    (g) Lead Federal Agency is the Federal agency that has primary 
responsibility for coordinating a CERCLA response action.
    (h) Memorandum of understanding (MOU) is the FEMA/EPA document that 
outlines the Agencies' responsibilities in implementing permanent and 
temporary relocation assistance under CERCLA.
    (i) On Scene Coordinator (OSC) is the Federal official predesignated 
by the Lead Federal Agency to coordinate and direct Federal response.
    (j) Permanent relocation assistance is the acquisition of real and/
or personal property and the provision of assistance to residents, 
businesses and community facilities in finding, acquiring and/or renting 
replacement housing under CERCLA.
    (k) Temporary relocation assistance is that assistance provided 
under FEMA Temporary Relocation Assistance Regulations, 44 CFR part 220, 
to those persons temporarily displaced as a result of CERCLA actions.
    (l) Uniform regulation means the Uniform Relocation Assistance and 
Real Property Acquisition for Federal and Federally-Assisted Programs 
Regulations, 49 CFR part 24.



Sec. 221.3  Program intent.

    The intent of the FEMA Permanent Relocation Assistance Program is to 
acquire real and personal property, at a fair and equitable price, and 
to provide relocation assistance to eligible residents, businesses, and 
community facilities which are displaced for public health and safety 
reasons in connection with a Superfund hazardous substance response 
action and/or to allow the EPA or its agents to conduct clean-up 
activities. The program is not necessarily intended to totally 
compensate affected parties for all expenses and losses associated with 
contamination of the site.



Sec. 221.4  Eligibility criteria.

    Permanent Relocation Assistance is provided to those residents, 
businesses, and community facilities determined by EPA to need permanent 
relocation in connection with a CERCLA action.



Sec. 221.5  Duplication of benefits.

    Otherwise eligible permanent relocation benefits shall not be 
provided to a relocatee if such benefits would duplicate assistance 
which has been or will be provided by any other governmental source. 
Duplication of benefits between permanent relocation and temporary 
relocation assistance under CERCLA, or between permanent relocation 
assistance and disaster assistance provided by government or private 
sources, is also prohibited.



Sec. 221.6  FEMA administration.

    (a) The Associate Director (AD) for State and Local Programs and 
Support (SLPS) is responsible for the permanent relocation assistance 
program.

[[Page 520]]

The AD executes Cooperative Agreements with States for implementation of 
the permanent relocation programs.
    (b) The Assistant Associate Director (AAD) for Disaster Assistance 
Programs (DAP) is responsible for managing the permanent relocation 
assistance program and site-specific operations including:
    (1) Participating with EPA in preliminary site-specific planning, 
review of relocation options, and in determining relocation cost 
projections;
    (2) Negotiating interagency agreements with EPA which define the 
scope and funding level of permanent relocation projects;
    (3) Negotiating cooperative agreement with States and other parties 
to a address the roles and responsibilities of FEMA and other parties 
involved in permanent relocation programs; and
    (4) Providing permanent relocation assistance.
    (c) FEMA Regional Directors are responsible for the following:
    (1) Referring all inquiries concerning permanent relocation actions 
to the Assistant Associate Director, DAP, and
    (2) Providing staff support to the Assistant Associate Director, 
DAP.



Sec. 221.7  State commitments.

    Permanent relocation assistance can be implemented only after the 
State enters into a cooperative agreement with FEMA which documents its 
agreements to the following:
    (a) To take title to all real property in accordance with section 
104(j)(2) of CERCLA, as amended;
    (b) To condemn property when necessary to obtain title, unless the 
State is able to demonstrate that State law does not authorize such 
condemnations;
    (c) To pay the percentage of the cost of the permanent relocation 
program required by section 104(c)(3) of CERCLA, as amended;
    (d) To restrict the use of purchased property to those purposes 
determined to be acceptable by State and federal health officials and to 
distribute proceeds of any subsequent sale on the same cost-share basis 
indicated in paragraph (c) of this section;
    (e) To coordinate all permanent relocation activities with FEMA.



Sec. 221.8  State administration.

    States may elect to administer permanent relocation activities in 
lieu of FEMA administration. When a State agrees to administer all or 
part of the relocation activity, the State must submit a permanent 
relocation plan to the Assistant Associate Director, Disaster Assistance 
Program, State and Local Programs and Support for FEMA approval and 
implement the plan in accordance with these regulations and the Uniform 
Regulations. The plan shall include the items listed below:
    (a) Identification of the State and/or local agencies assigned 
relocation responsibilities;
    (b) A narrative defining the scope of the relocation project to 
include an organization and staffing plan;
    (c) Budget and estimated outlay schedule;
    (d) Time frames within which tasks will be accomplished; and
    (e) Procedures to be used in providing assistance.

(Approved by the Office of Management and Budget under control number 
3067-0156)



            Subpart B--Real and Personal Property Acquisition



Sec. 221.9  Real property acquisition.

    (a) Real property will be acquired when EPA determines acquisition 
is necessary under CERCLA.
    (b) Real property will be acquired pursuant to 49 CFR part 24.
    (c) Only real property specifically identified by EPA or the lead 
Federal agency by individual address or site boundaries will be 
acquired.
    (d) The property owner must grant the government permission to 
conduct CERCLA related activities on his or her property before 
relocation assistance may be provided to the owner.
    (e) Only real property located within the site boundary at the time 
of the formal announcement (as defined in 49 CFR part 24, subpart A, 
Sec. 24.2(k)) by EPA of the need for a permanent relocation, and which 
remains within the site boundaries at the time of closing, will be 
acquired.

[[Page 521]]



Sec. 221.10  Personal property acquisition.

    Personal property acquisition will be accomplished as prescribed in 
44 CFR 220.13.



                    Subpart C--Relocation Assistance



Sec. 221.11  Relocation assistance.

    Relocation assistance will be provided to all displaced persons 
pursuant to 49 CFR part 24, subpart C. Additional requirements and 
considerations are:
    (a) Those eligible for permanent relocation assistance may be 
required to vacate their property immediately to a temporary location 
because of the danger continued occupancy may pose to the health and 
safety of the occupants or the public.
    (b) Pursuant to the requirements of Executive Order 11988 and 44 CFR 
part 9, persons displaced by a CERCLA action will not be relocated to 
areas in a floodplain unless there are not practicable alternative 
housing sites.
    (c) Persons displaced by a CERCLA action and who permanently 
relocate to an area of special hazard (as defined in the Flood Disaster 
Protection Act of 1973, Pub. L. 93-234) will not be eligible for federal 
financial assistance for acquisition or construction purposes (pursuant 
to section 102(a) of the Act) if they do not purchase flood insurance.
    (d) Persons displaced are not eligible for assistance to relocate to 
special flood hazard areas of communities which do not participate in 
the Flood Insurance Program.



           Subpart D--Payments for Moving and Related Expenses



Sec. 221.12  Moving and related expenses.

    Payments for moving and related expenses will be provided as 
prescribed in 49 CFR part 24, subpart D.



                 Subpart E--Replacement Housing Payments



Sec. 221.13  Replacement housing payments.

    Payments for replacement housing will be provided as prescribed in 
49 CFR part 24, subpart E.



                         Subpart F--Mobile Homes



Sec. 221.14  Mobile homes.

    Assistance for mobile home owners and occupants will be provided as 
prescribed in 49 CFR part 24, subpart F.



PART 222--SUPERFUND COST SHARE ELIGIBILITY CRITERIA FOR PERMANENT AND TEMPORARY RELOCATION--Table of Contents




Sec.
222.1  Purpose.
222.2  Definitions.
222.3  Program intent.
222.4  Matching contributions.
222.5  Criteria for acceptable contributions.
222.6  Documentation of matching contributions.
222.7  General eligible costs.
222.8  Ineligible costs.
222.9  Appeals.

    Authority: Reorganization Plan Number 3 of 1978; 42 U.S.C. 9601 et 
seq.; Comprehensive Environmental Response, Compensation, and Liability 
Act of 1980, Pub. L. 96-510; Superfund Amendments and Reauthorization 
Act of 1986, Pub. L. 99-499; E.O. 12580, Superfund Implementation.

    Source: 52 FR 6800, Mar. 5, 1987, unless otherwise noted.



Sec. 222.1  Purpose.

    This part prescribes the criteria to be followed by the Federal 
Emergency Management Agency (FEMA), or any state acting on its behalf 
when implementing cost sharing under the Comprehensive Environmental 
Response, Compensation and Liability Act of 1980 (CERCLA), as amended, 
also known as Superfund.



Sec. 222.2  Definitions.

    (a) Acceptable contributions means either cash (or its equivalent, 
appropriated funds) or the value of contributions of goods, facilities 
or services, or combinations of these, that can qualify for and meet 
matching share requirements.
    (b) Allowable costs means those eligible, reasonable and necessary, 
costs which are permitted under the appropriate Federal cost principles, 
in accordance with FEMA policy, within the scope of the project, 
authorized for FEMA participation and in accordance

[[Page 522]]

with OMB Circular A-87, Cost Principles for State and Local Governments.
    (c) Cash contributions means the recipient's (state or local 
government) cash outlay, including the outlay of money contributed to 
the recipient by other public agencies, institutions, private 
organizations, and individuals.
    (d) Cost share means that portion of the allowable project cost 
which is not derived from Federal assistance.
    (e) Value is the cost to the state for services and facilities or 
goods.



Sec. 222.3  Program intent.

    (a) This regulation is intended to provide criteria with regard to 
the states' allowable costs associated with the administration of 
temporary and permanent relocation activities under CERCLA. CERCLA 
section 104(c)(3), as amended, states that the state will pay or assure 
payment of (1) 10 per centum of the costs of the remedial action, 
including all future maintenance or, (2) 50 per centum (or such greater 
amount as the President may determine appropriate, taking into account 
the degree of responsibility of the state or political subdivision for 
the release) of any sums expended in response to a release at a facility 
that was operated by the state or a political subdivision thereof, 
either directly, or through a contractual relationship or otherwise at 
the time of any disposal of hazardous substances therein. The Federal 
Government will pay 90 per centum under (a)(1) and 50 per centum or less 
under (a)(2).
    (b) FEMA will determine, based on policy determinations with 
prospective effect, applying the criteria set out in Secs. 222.4 and 
222.5, the eligibility of any matching contributions not covered by this 
regulation. Expenditures and other actions must be in compliance with 
applicable FEMA/State cooperative agreements, contracts, Uniform 
Relocation Assistance and Real Property Acquisition for Federal and 
Federally-Assisted Programs (Uniform Regulations), relocation plans, 
relocation criteria, and OMB Circular    A-87, Cost Principles for State 
and Local Governments. FEMA and the state shall maintain adequate 
records of its acquisition and relocation activities in sufficient 
detail to demonstrate compliance with these regulations.
    (c) This regulation shall be used in conjunction with the following 
documents:
    (1) Comprehensive Environmental Response, Compensation and Liability 
Act of 1980 (CERCLA), Public Law 96-510;
    (2) Superfund Amendments and Reauthorization Act of 1986, Public Law 
   99-499;
    (3) Executive Order 12580, Superfund Implementation;
    (4) FEMA relocation regulations and criteria;
    (5) OMB Circular A-87, Cost Principles for State and Local 
Governments;
    (6) Uniform Relocation Assistance and Real Property Acquisition for 
Federal and Federally-Assisted Programs (Uniform Regulations) 44 CFR 
part 25; and
    (7) Uniform Relocation Assistance and Real Property Acquisition 
Policies Act of 1970 (84 Stat. 1894; 42 U.S.C. 9615)



Sec. 222.4  Matching contributions.

    Either cash and/or the value of goods, services or facilities can 
qualify as matching contributions. Matching contributions need not be 
applied at the exact time or in proportion to the obligation of the 
Federal funds. However, the full matching share must be obligated by the 
end of the project for which the Federal funds have been made available 
for obligation under an approved program or project.



Sec. 222.5  Criteria for acceptable contributions.

    (a) The value of any resources accepted as a matching share under 
one Federal agreement or program cannot be counted again as a 
contribution under another.
    (b) The state seeking the match shall submit documentation 
sufficient for FEMA to determine that the contribution meets the 
following requirements. The match shall be:
    (1) Necessary and reasonable for proper, cost-effective and 
efficient administration of the project, allocable solely thereto 
(subject to valid approved credit from a previous project), and except 
as specifically provided

[[Page 523]]

herein, not be a general expense required to carry out the overall 
responsibilities of State and local governments;
    (2) Verifiable from primary recipient's records;
    (3) Not allocable to or included as a cost of any other federally-
financed program;
    (4) Authorized under State law;
    (5) In conformance with limitations or exclusions set forth in these 
regulations, Federal laws or other governing limitations as to types or 
amounts of cost items;
    (6) Accorded consistent treatment through application of generally 
accepted accounting principles appropriate to the circumstances; and
    (7) In conformance with OMB Circular A-87, Cost Principles for State 
and Local Governments.



Sec. 222.6  Documentation of matching contributions.

    (a) The state shall maintain documentation for all items related to 
the relocation that it plans to use as a matching contribution. For 
items eligible for matching contributions, documentation of dates on 
which the action took place, who performed such action, the cost, and 
specific work performed shall be sufficient.
    (b) When items are not specifically on the list of General Eligible 
Costs, Sec. 222.7 of this part) the following shall be required in 
addition to the documentation in paragraph (a) of this section: 
Sufficient supporting documentation detailing the type of work eligible, 
and justification to the relocation activity.
    (c) The state shall also comply with the following requirements for 
all matching contributions:
    (1) The state is responsible for maintaining records of the match 
and providing the documentation by eligible category when requested by 
FEMA or its agent.
    (2) The basis by which the state determines the value of the match 
must be documented and a copy retained as part of the official record. 
State matching share records are subject to audit inspections in the 
same manner and to the same extent as records dealing with the receipt 
and disposition of Federal funding.
    (3) These records shall become property of FEMA following completion 
of the project or, at FEMA's request, shall be retained by the state for 
a period of ten years.

(Approved by the Office of Management and Budget under Control Number 
3067-0184)



Sec. 222.7  General eligible costs.

    Subject to the provision of section 104(c)(5) of CERCLA, as amended, 
the following is a list of eligible expenditures. When items do not 
appear on the list they will be considered on a case-by-case basis for 
policy determinations, based on the criteria set forth in Sec. 222.5. 
All costs must be reasonable.
    (a) Direct and indirect salaries or wages (including overtime) of 
employees hired specifically for the permanent or temporary relocation 
when engaged in the performance of eligible work for the permanent of 
temporary relocation.
    (b) Direct and indirect salaries or wages (including overtime) of 
state employees whose duties change, when they are engaged in the 
performance of eligible work for the permanent or temporary relocation.
    (c) Regular salaries or wages of regularly employed police and fire 
personnel when they are engaged in the performance of work for the 
permanent or temporary relocation.
    (d) Reasonable costs for work performed by private contractors on 
eligible projects contracted for by the state.
    (e) Audit costs for the relocation activity.
    (f) Costs for providing site security.
    (g) Travel costs and per diem costs of state employees not to exceed 
the actual subsistence expense basis for the permanent or temporary 
activity.
    (h) Costs for rental of protective gear and costs for protective 
gear reasonably lost, worn out or destroyed when used in performing work 
directly related to the permanent relocation activity and fully 
documented. Protective gear may be purchased if it cannot be rented more 
cheaply.

[[Page 524]]

    (i) Only costs for the control of vectors which exceed the average 
cost included for same during the previous three years, when such 
controls are in the public interest.
    (j) Costs for providing permanent relocation assistance and real 
property acquisition when in accordance with Public Law 91-646, the 
Uniform Relocation Assistance and Real Property Acquisition Policies Act 
of 1970 (84 Stat. 1894; 42 U.S.C. 9615) and FEMA regulations and 
criteria issued pursuant thereto. These costs include:
    (1) Costs for exercising the power of eminent domain to obtain real 
property interest;
    (2) Costs for the filing and recording of deeds in the recorder's 
office;
    (3) Costs for the review of all sales contracts, title insurance 
commitments and deeds regarding the conveyance of real property 
interests prior to the purchase of such real property interests; and
    (4) Costs for the development and implementation of a property 
acquisition and permanent relocation assistance program. These include, 
but are not limited to the following costs:
    (i) Development of a permanent relocation analysis;
    (ii) Development and implementation of a community relations 
program;
    (iii) Title searches and appraisals for property within the 
boundaries of the project;
    (iv) A relocation assistance advisory program;
    (v) Title reviews, settlements and closings associated with 
properties located within boundaries of the project;
    (vi) The preparation of offers of compensation;
    (vii) Acquisition of properties;
    (viii) Costs for administrative settlements;
    (ix) Costs for relocation assistance; and
    (x) Costs for replacement housing payments.
    (k) Costs for providing temporary relocation assistance in 
accordance with FEMA policies which include: Negotiating leases, rent 
reimbursements, moving expenses, essential utility costs at original 
residence, food subsidy during transient accommodations, rental of 
essential furniture, and kennel costs.



Sec. 222.8  Ineligible costs.

    (a) Regular salaries or wages of state employees, other than police 
or fire personnel, whose duties do not change or are not directly 
associated with the permanent or temporary relocation are ineligible.
    (b) Replacement of revenue lost as a result of contamination in the 
project area are not eligible.
    (c) Costs associated with potential litigation as a result of the 
states' pursuit and recovery of the states' cost share.



Sec. 222.9  Appeals.

    (a) The Assistant Associate Director, Disaster Assistance Programs, 
State and Local Programs and Support, shall be responsible for making 
all policy determinations regarding Superfund cost-sharing eligibility 
for permanent and temporary relocation. The allowability of matching 
contributions, particularly those not covered in this regulation, will 
also be determined by the Assistant Associate Director.
    (b) Appeals from the determinations of the Assistant Associate 
Director may be made to the Associate Director, State and Local Programs 
and Support.



PARTS 223-299 [RESERVED]




[[Page 525]]



                       SUBCHAPTER E--PREPAREDNESS





PART 300--DISASTER PREPAREDNESS ASSISTANCE--Table of Contents




Sec.
300.1  Definitions.
300.2  Technical assistance.
300.3  Financial assistance.

    Authority: 42 U.S.C. 5121 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.

    Source: 45 FR 13464, Feb. 29, 1980, unless otherwise noted.



Sec. 300.1  Definitions.

    As used in this part:
    (a) The Act means the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act, 42 U.S.C. 5121 et seq.
    (b) Disaster assistance plans means those plans which identify tasks 
needed to deliver disaster assistance and to avoid, reduce, or mitigate 
natural hazards; make assignments to execute those tasks; reflect State 
authorities for executing disaster assignments; and provide for adequate 
training of personnel in their disaster or mitigation assignments.
    (c) Mitigation means the process of systematically evaluating the 
nature and extent of vulnerability to the effects of natural hazards 
present in society and planning and carrying out actions to minimize 
future vulnerability to those hazards to the greatest extent 
practicable.
    (d) State means any State of the United States, the District of 
Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, 
Commonwealth of the Northern Mariana Islands, the Trust Territory of the 
Pacific Islands, the Federated States of Micronesia, or the Republic of 
the Marshall Islands.

[54 FR 2128, Jan. 19, 1989]



Sec. 300.2  Technical assistance.

    Requests for technical assistance under section 201(b) of the Act 
shall be made by the Governor or his/her designated representative to 
the Regional Director.
    (a) The request for technical assistance shall indicate as 
specifically as possible the objectives, nature, and duration of the 
requested assistance; the recipient agency or organization within the 
State; the State official responsible for utilizing such assistance; the 
manner in which such assistance is to be utilized; and any other 
information needed for a full understanding of the need for such 
requested assistance.
    (b) The request for assistance requires participation by the State 
in the technical assistance process. As part of its request for such 
assistance, the State shall agree to facilitate coordination among FEMA, 
local governments, State agencies and the businesses and industries in 
need of assistance in the areas of disaster preparedness and mitigation.

[54 FR 2129, Jan. 19, 1989]



Sec. 300.3  Financial assistance.

    (a) The Regional Director may provide to States upon written request 
by the State Governor or an authorized representative, an annual 
improvement grant up to $50,000, but not to exceed 50 percent of 
eligible costs, except where separate legislation requires or permits a 
waiver of the State's matching share, e.g., with respect to ``insular 
areas'', as that term is defined at 48 U.S.C. 1469a(d). The nonfederal 
share in all cases may exceed the Federal share.
    (b) The improvement grant shall be product-oriented; that is, it 
must produce something measurable in a way that determines specific 
results, to substantiate compliance with the grant workplan objectives 
and to evidence contribution to the State's disaster capability. The 
following list, which is neither exhaustive nor ranked in priority 
order, offers examples of eligible products under the Disaster 
Preparedness Improvement Grant Program:
    (1) Evaluations of natural hazards and development of the programs 
and actions required to mitigate such hazards;
    (2) Hazard mitigation activities, including development of 
predisaster natural hazard mitigation plans, policies, programs and 
strategies for State-level multi-hazard mitigation;

[[Page 526]]

    (3) Updates to State disaster assistance plans, including plans for 
the Individual and Family Grant (IFG) Program, Public Assistance 
Program, Hazard Mitigation Grant Program, Disaster Application Center 
operations, damage assessment, etc.;
    (4) Handbooks to implement State disaster assistance program 
activities;
    (5) Exercise materials (EXPLAN, scenario, injects, etc.) to test and 
exercise procedures for State efforts in disaster response, including 
provision of individual and public assistance;
    (6) Standard operating procedures for individual State agencies to 
execute disaster responsibilities for IFG, crisis counseling, mass care 
or other functional responsibilities;
    (7) Training for State employees in their responsibilities under the 
State's disaster assistance plan;
    (8) Report of formal analysis of State enabling legislation and 
other authorities to ensure efficient processing by the State of 
applications by governmental entities and individuals for Federal 
disaster relief;
    (9) An inventory of updated inventory of State/local critical 
facilities (including State/local emergency operations centers) and 
their proximity to identified hazard areas;
    (10) A tracking system of critical actions (identified in 
postdisaster critiques) to be executed by State or local governments to 
improve disaster assistance capabilities or reduce vulnerability to 
natural hazards.
    (11) Plans or procedures for dealing with disasters not receiving 
supplementary Federal assistance;
    (12) Damage assessment plans or procedures;
    (13) Procedures for search and rescue operations; and,
    (14) Disaster accounting procedures.
    (c) The State shall provide quarterly financial and performance 
reports to the Regional Director. Reporting shall be by program quarter 
unless otherwise agreed to by the Regional Director.

[54 FR 2129, Jan. 19, 1989]



PART 301--CONTRIBUTIONS FOR CIVIL DEFENSE EQUIPMENT--Table of Contents




Sec.
301.1  Purpose.
301.2  Definitions.
301.3  Project applications.
301.4  Conditions of contributions.
301.5  [Reserved]
301.6  Billing and payment.
301.7  Advances of Federal funds.
301.8  Limitations on amount and obligation of Federal funds.
301.9  Procurement.
301.10  [Reserved]
301.11  Compliance.

    Authority: 50 U.S.C. app. 2251 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.



Sec. 301.1  Purpose.

    The purpose of the regulations in this part is to prescribe the 
basic terms and conditions under which the FEMA, pursuant to the 
provisions of section 201(i) of the Act, contributes Federal funds to 
the States for the procurement of civil defense equipment.

[29 FR 1322, Jan. 25, 1964. Redesignated at 29 FR 6384, May 15, 1964, 
and further redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 301.2  Definitions.

    Except as otherwise stated, when used in the regulations in this 
part, the meaning of the listed terms are as follows:
    (a) Act. The Federal Civil Defense Act of 1950, as amended (50 
U.S.C. App. 2251 et seq.).
    (b) Allowable costs. Except where Federal assistance for such costs 
is restricted or prohibited by law, the cost principles set forth in CPG 
1-3, as required by OMB Circular A-87 apply in determining allowability 
and allocability of costs incurred by States and their political 
subdivisions. Costs which are allowable only with the approval of the 
grantor agency are allowable only to the extent so provided in CPG 1-3. 
No cost is allowable unless it is required to meet civil defense needs 
determined in accordance with the provisions of CPG 1-3.
    (c) Civil defense equipment. Facilities, materials, and 
organizational equipment for which the FEMA approves financial 
contributions under section 201(i) of the act.
    (d) CPG 1-3. FEMA's ``Federal Assistance Handbook'' promulgated as 
Civil Preparedness Guide (CPG) 1-3 as amended by numbered changes 
thereto and by Civil Preparedness Circulars (CPC).

[[Page 527]]

    (e) FEMA. Federal Emergency Management Agency. Where action is to be 
taken, this term denotes the Director or other duly authorized 
official(s) acting under the authority delegated.
    (f) Facilities. Buildings, shelters, and utilities, exclusive of 
land.
    (g) Grantee. A State, and where applicable, a political subdivision 
joining in the State's application, which holds a FEMA-approved project 
application for Federal financial assistance under section 201(i) of the 
act, which has not been closed out by completion or termination under 
FEMA procedures set forth in CPG 1-3.
    (h) Materials. All materials, supplies, medicines, equipment, 
component parts, and technical information (including training courses) 
and processes necessary for civil defense.
    (i) Organizational equipment. Equipment (other than materials and 
facilities) determined by the FEMA to be (1) necessary to a civil 
defense organization, as distinguished from personal equipment, and (2) 
of such type or nature as to require it to be financed in whole or in 
part by the Federal Government. It shall not be construed to include 
those items which the local community normally utilizes in combating 
local disasters except when required in unusual quantities dictated by 
the requirement of the civil defense plans.
    (j) Program. A course of action adopted by a State (or political 
subdivision) in a specific civil defense area of activity.
    (k) Project. A definable part of a program which is complete in 
itself.
    (l) State. Any of the several States; the District of Columbia; the 
Commonwealth of Puerto Rico; the Government of the Northern Mariana 
Islands; the territories of American Samoa, Guam, and the Virgin 
Islands; and interstate civil defense authorities established by 
interstate compact pursuant to section 201(g) of the act.

[43 FR 25093, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979, 
as amended at 44 FR 62517, Oct. 31, 1979; 48 FR 44544, Sept. 29, 1983; 
50 FR 40007, Oct. 1, 1985]



Sec. 301.3  Project applications.

    (a) Forms and assurances. A request for a Federal financial 
contribution shall be made on a FEMA-prescribed project application form 
conforming to the requirements of Attachment M of OMB Circular No. A-
102, and, in addition to acknowledgement of the applicant's receipt of a 
copy of CPG 1-3 shall contain assurances of and agreement for compliance 
with the regulations, policies, guidelines and requirements of FEMA 
regulations in subchapter E, chapter I, of title 44 of the Code of 
Federal Regulations, CPG 1-3, OMB Circular A-87 and OMB Circular No. A-
102.
    (b) Scope. The project application should cover a definable civil 
defense purpose, complete in itself. Although explanatory information 
for cost estimate purposes must be detailed, applicants are to define 
the project in terms of civil defense measures to be undertaken rather 
than as a shopping list for purchase. For example, in terms of providing 
a civil defense warning system for a given geographical area's 
population, the specific number and types of sirens and other equipment 
expected to be required would be indicated as background information for 
the budget summary.
    (c) Signature. The project application must be signed by an 
authorized official of the State and in the case of a political 
subdivision joining the State in its application, also by an authorized 
official of such political subdivision. Except as otherwise required by 
law, no authorized official will be required to sign the same project 
application more than once. However, should changes in the scope of the 
project, the applicable terms and conditions, or the amount of funding 
be requested, an authorized official representing each applicant may be 
required to sign a revision or an addendum on the same form as the 
original, but no applicant shall be required to provide information 
which was previously provided in the original application.
    (d) Procedures. Procedures for the processing of project 
applications are set forth in CPG 1-3. They include provisions for 
informing the applicant of the basis for any rejection of its 
application.
    (e) Deadlines. Project applications, addenda thereto, revised 
applications,

[[Page 528]]

and requests for changes or supplements to approved grants must be timed 
to accommodate fiscal year limitations on the obligation of Federal 
funds. (See Sec. 301.8 of this part.)
    (f) Construction projects. Project applications for all grants where 
a major portion of the project involves construction work must be 
submitted on a FEMA prescribed project application form conforming to 
the requirements of Attachment M of OMB Circular No. A-102 pertaining to 
application for Federal assistance for construction programs, and the 
project must be carried out in accordance with the applicable 
requirements of FEMA regulations for federally assisted construction. 
Some examples of projects where a major portion normally would be 
considered to involve construction work are those for incorporting an 
emergency operating center in the construction of a new public building, 
the modification of a portion of an existing public building for use as 
an emergency operating center, the erection of antenna towers for a 
civil defense communications system, the erection of towers or poles for 
sirens for use in a civil defense warning system, and the installation 
of an emergency generator for civil defense use.
    (g) Appeals. Upon rejection of a project application by the Regional 
Director, FEMA on a basis other than a lack of available funding, the 
applicant may appeal to the Director, FEMA, under procedures set forth 
in CPG 1-3.

[43 FR 25093, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979 
and amended at 48 FR 44544, Sept. 29, 1983; 50 FR 40007, Oct. 1, 1985]



Sec. 301.4  Conditions of contributions.

    FEMA contributions for civil defense equipment costs are subject to 
the following conditions:
    (a) Certification. The making of a request for a contribution shall 
constitute a certification by the State (and political subdivision, 
where applicable) that the State's matching share is available or will 
be available before Federal funds are disbursed; that the civil defense 
equipment, regarding which a contribution is requested, is needed by the 
applicant over and above its other-than-civil defense needs, in order to 
meet its requirements under civil defense operational plans approved by 
FEMA (local plans are approved as part of the State plans); and that the 
State (and political subdivision, where applicable) will comply with the 
policies, guidelines and requirement contained in the Assurances section 
of the project application, including without limitation, FEMA 
regulations (Code of Federal Regulations, title 44, chapter I--Federal 
Emergency Management Agency, subchapter E) and with criteria and 
procedures set forth in CPG 1-3.
    (b) Standards and specifications. Civil defense equipment procured 
by the State (or political subdivision) must meet such FEMA-prescribed 
minimum standards and specifications as are set forth in CPG 1-3 or 
other FEMA guidance material referenced therein. Application of such 
standards and specifications to unique installation or uses of equipment 
shall be as determined by FEMA following receipt of full information in 
accordance with procedures set forth in CPG 1-3.
    (c) Financial management--(1) System. Grantees shall establish and 
maintain a financial management system in conformity with the standards 
set forth in CPG 1-3 as required by Attachment G of OMB Circular No. A-
102.
    (2) Reporting. Grantees shall comply with the uniform financial 
reporting requirements set forth in section 2 of Chapter 3 of CPG 1-3, 
as required by Attachment H of OMB Circular No. A-102.
    (d) Property management--(1) Standards. Grantees shall comply with 
the standards set forth in CPG 1-3, as required by Attachment N of OMB 
Circular No. A-102, governing the utilization and disposition of 
property which has been furnished by the Federal Government, acquired in 
whole or in part with Federal funds, or whose cost has been charged to a 
project supported by a Federal grant.
    (2) Release of Federal interest. As to the requirement of CPG 1-3 
(Attachment N of OMB Circular No. A-102) for payment to FEMA of an 
amount equal to the Federal share of its fair market value prior to 
disposal or other than authorized use of an item of nonexpendable 
personal property procured

[[Page 529]]

by a political subdivision at a unit acquisition cost of $1,000 or more, 
where guaranty by the State of such payment to FEMA is not permissible 
under State law, the guaranty by the State, as joint applicant with its 
political subdivision shall be limited to an amount not to exceed the 
amount of the Federal contribution paid by FEMA toward procurement of 
the particular item of property.
    (3) Use. With regard to application of the property management 
standards set forth in appendix D of CPG 1-3, ``purpose of the grant 
program,'' includes use for providing emergency assistance in any area 
of the United States which suffers a disaster other than a disaster 
caused by enemy attack. Detailed guidance is set forth in CPG 1-3.
    (e) Monitoring and reporting program performance. Grantees shall 
comply with the provisions set forth in CPG 1-3, as required by OMB 
Circular No. A-102, regarding the monitoring and reporting of grant-
supported activities and programs.
    (f) Records retention and availability. Financial records, 
supporting documents, and all other records pertinent to a grant shall 
be retained by the grantee and made available as prescribed by appendix 
B of CPG 1-3 in accordance with the requirements of OMB Circular No. A-
102.

[43 FR 25093, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979, 
as amended at 50 FR 40007, Oct. 1, 1985]



Sec. 301.5  [Reserved]



Sec. 301.6  Billing and payment.

    When civil defense equipment procured by a State (or political 
subdivision) has been delivered to the State (or political subdivision), 
the FEMA, upon the receipt of proper billing, shall make payment, by 
check drawn against the Treasury of the United States, to the authorized 
official of the State or political subdivision designated by the State.

[43 FR 25094, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 301.7  Advances of Federal funds.

    The State (and where appropriate, the political subdivision) shall 
submit their requests for advance payment on the ``Request for Advance 
or Reimbursement'' form (FEMA Form No. 1406) prescribed in Attachment H 
of OMB Circular No. A-102. Advances by Treasury check will be made in 
accordance with the provisions of Treasury Circular No. 1075 and FEMA 
promulgated guidance material furnished the State and political 
subdivision; Provided, That the State (and where applicable, the 
political subdivision) has established or demonstrated to FEMA the 
willingness and ability to establish procedures that will minimize the 
time elapsing between the transfer of funds and their disbursement by 
the State or political subdivision, as the case may be; and Provided 
further, That the State (and where applicable, its political 
subdivision) has established a financial management system meeting the 
standards for fund control and accountability prescribed in Attachment G 
of OMB Circular No. A-102 ``Standards for Grantee Financial Management 
Systems.''

[40 FR 36328, Aug. 20, 1975, as amended at 43 FR 25094, June 9, 1978. 
Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 301.8  Limitations on amount and obligation of Federal funds.

    (a) Federal-grantee share. The Federal contribution shall not exceed 
50 percent of the total allowable cost of the civil defense equipment. 
The grantee's share of such cost may be derived from any source it 
determines consistent with its laws; Provided, however, That except as 
otherwise expressly provided by Federal law, no part of the grantee's 
share has been or will be derived from Federal funds. No Federal 
contribution shall be made for the procurement of land. The value of any 
land contributed to the program or project shall be excluded from the 
computation of the grantee's share.
    (b) Fiscal year control. Federal funds are available for obligation 
under the program in this part on a Federal fiscal year basis (October 1 
to September 30, inclusive) and cannot be used to cover obligations 
incurred or expenditures made by a grantee prior to the date of first 
availability of the appropriation otherwise remaining available for 
obligation. With regard to services, such as

[[Page 530]]

maintenance and utility services, being rendered over a continuing 
period of time, contributions shall be only for eligible services 
required to serve the civil defense needs of the grantee during the 
Federal fiscal year current at the time the project application is 
approved by FEMA.

[43 FR 25094, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 301.9  Procurement.

    Grantees shall comply with the provisions of CPG 1-3, as required by 
OMB Circular No. A-102, regarding the procurement of supplies, 
equipment, construction, and other services with the assistance of 
Federal funds. Included, without limitation, is a provision that, with 
certain specified exceptions, formal advertising, with adequate purchase 
description, sealed bids, and public openings shall be the required 
method of procurement. Where such advertised bids are obtained, the 
awards shall be made to the responsible bidder whose bid is responsive 
to the invitation and is most advantageous to the grantee, price and 
other factors considered and FEMA's contribution will be limited to its 
share of the allowable costs under such lowest acceptable bid.

[43 FR 25094, June 9, 1978. Redesignated at 44 FR 56173, Sept. 28, 1979, 
as amended at 50 FR 40007, Oct. 1, 1985]



Sec. 301.10  [Reserved]



Sec. 301.11  Compliance.

    (a) The State (or political subdivision) must be prepared to furnish 
the FEMA, upon its request, with proper documentation that there has 
been compliance with the requirements of the regulations in this part 
and the related procedures and criteria prescribed in CPG 1-3 in 
connection with its procurement of any item of civil defense equipment 
and its request and receipt of a Federal contribution therefor.
    (b) Where, after reasonable notice to the State and opportunity for 
hearing in accordance with part 303 of this chapter, the FEMA finds that 
the State (or political subdivision) has failed or is failing to expend 
funds in accordance with the requirements of the Act or the terms and 
conditions of the regulations in this part, the FEMA may withhold 
payments of any financial contributions to such State, due or to become 
due.

[29 FR 1322, Jan. 25, 1964. Redesignated at 29 FR 6384, May 15, 1964, as 
amended at 43 FR 25094, June 9, 1978. Further redesignated at 44 FR 
56173, Sept. 28, 1979]



PART 302--CIVIL DEFENSE-STATE AND LOCAL EMERGENCY MANAGEMENT ASSISTANCE PROGRAM (EMA)--Table of Contents




Sec.
302.1  Purpose.
302.2  Definitions.
302.3  Documentation of eligibility.
302.4  Merit personnel systems.
302.5  Allocations and reallocations.
302.6  Fiscal year limitation.
302.7  Use of funds, materials, supplies, equipment, and personnel.
302.8  Waiver of ``single'' State agency requirements.

    Authority: 50 U.S.C. app. 2251 et seq. Reorganization Plan No. 3 of 
1978; E.O. 12148.

    Source: 48 FR 44211, Sept. 28, 1983, unless otherwise noted.



Sec. 302.1  Purpose.

    (a) The regulations in this part prescribe the requirements 
applicable to the Emergency Management Assistance (EMA) program for 
Federal financial contributions to the States, and through the States to 
their political subdivisions, for up to one half of the necessary and 
essential State and local civil defense personnel and administrative 
expenses, under section 205 of the Federal Civil Defense Act of 1950, as 
amended, and set forth the conditions under which such contributions 
will be made.
    (b) The intent of this program is to increase civil defense 
operational capability at the State and local levels of government by 
providing Federal financial assistance so that personnel and other 
resources can be made available for essential planning and other 
administrative functions and activities required in order to accomplish 
this objective.

[[Page 531]]



Sec. 302.2  Definitions.

    Except as otherwise stated or clearly apparent by context, the 
definitions ascribed in this section to each of the listed terms shall 
constitute their meaning when used in the regulations in this part. 
Terms not defined in this part shall have the meaning set forth in their 
definition, if any, in the Federal Civil Defense Act of 1950, as 
amended.
    (a) Act. The Federal Civil Defense Act of 1950, as amended (50 
U.S.C. App. 2251 et seq.).
    (b) Administrative expenses. Necessary and essential expenses, other 
than personnel expenses as defined in this section, of a grantee and its 
subgrantees incurred in the administration of their civil defense 
programs, as detailed in CPG 1-3, Federal Assistance Handbook, and in 
CPG 1-32, FEMA Financial Assistance Guidelines.
    (c) Annual submission. The State's annual request for participation 
in the contributions program authorized by section 205 of the Act. As 
specified in CPG 1-3, it includes staffing patterns (including job 
description changes), budget requirements, and any amendments to the 
State administrative plan, a request for funds covering the State and 
its subgrantees and program statements of work for the grantee and 
subgrantees under the Comprehensive Cooperative Agreement.
    (d) Approval. All approvals by the Federal Emergency Management 
Agency (FEMA) as grantor agency required under the regulations in this 
part mean prior approval in writing signed by an authorized FEMA 
official. When failure to obtain prior approval of an action has not 
resulted and is not expected to result in any failure of compliance with 
a substantive requirement, and approval after the fact is not contrary 
to law (or regulation having the effect of law), written approval after 
the fact may be granted at the discretion of the authorized official.
    (e) CPG 1-3. Civil Preparedness Guide entitled ``Federal Assistance 
Handbook,'' which sets forth detailed guidance on procedures that a 
State and, where applicable, its political subdivisions must follow in 
order to request financial assistance from the grantor agency. It also 
sets forth detailed requirements, terms, and conditions upon which 
financial assistance is granted under these regulations. Included are 
amendments by numbered changes. References to CPG 1-3 include provisions 
of any other volumes of the CPG series specifically referenced in CPG 1-
3. Copies of the Civil Preparedness Guides and the Civil Preparedness 
Circulars may be ordered by FEMA Regional Offices using FEMA Form 60-8 
transmitted to FEMA, P.O. Box 8181, Washington, DC, 20024. One or more 
copies of CPG 1-3 have been distributed to each State and to each local 
government participating in the program under the regulations in this 
part. Copies of revisions and amendments are distributed to 
participating governments (addressed to the Emergency Management 
Coordinator) upon issuance.
    (f) Comprehensive Cooperative Agreement (CCA). Provides for each 
State a single vehicle for applying for and receiving financial 
assistance for several discrete FEMA programs and for organizing and 
reporting on emergency management objectives and accomplishments, 
particularly under the funded programs.
    (g) Emergency management. Refers to the activities and measures 
undertaken by a State, or one of its political subdivisions, to manage a 
``civil defense program'' as defined and provided for by the Federal 
Civil Defense Act of 1950, as amended, including without limitation 
Title V, added by Public Law 96-342, and section 207, added by Public 
Law 97-86. Title V calls for an improved civil defense program that 
includes:
    (1) A program structure for the resources to be used for attack-
related civil defense; (2) a program structure for the resources to be 
used for disaster-related civil defense; and (3) criteria and procedures 
under which those resources planned for attack-related civil defense and 
those planned for disaster-related civil defense can be used 
interchangeably. Thus, emergency management includes ``civil defense'' 
for and operations in either attack-related or disaster-related 
emergencies. Section 207 allows Federal Civil Defense Act funds to be 
used for disaster preparedness and response if such use

[[Page 532]]

``is consistent with, contributes to, and does not detract from attack-
related civil defense preparedness.'' Also 44 CFR part 312, Use of Civil 
Defense Personnel, Materials, and Facilities for Natural Disaster 
Purposes, provides terms and conditions for such use.
    (h) Director. The head of the grantor agency or another official of 
the Agency authorized in writing by the Director to act officially on 
behalf of the Director.
    (i) Forms prescribed by the grantor agency. Forms prescribed by the 
grantor agency are identified in CPG 1-3 and may be ordered by FEMA 
Regional Offices using FEMA Form 60-8 transmitted to FEMA, P.O. Box 
8181, Washington, DC, 20024.
    (j) Grantee. A State that has received EMA funds as a result of 
having a State administrative plan, a statement of work, and an annual 
submission, all approved by the grantor agency as meeting the 
requirements prescribed in this part and in CPG 1-3 for necessary and 
essential State and local civil defense personnel and administrative 
expenses for a current Federal fiscal year.
    (k) Grantor agency. The Federal Emergency Management Agency (FEMA).
    (l) Interstate civil defense authority. Any civil defense authority 
established by interstate compact pursuant to section 201(g) of the Act.
    (m) Necessary and essential civil defense expenses. Necessary and 
essential civil defense expenses are those required for the proper and 
efficient administration of the civil defense program of a grantee or a 
subgrantee as described in a State administrative plan and statement of 
work approved by the Regional Director as being consistent with the 
national plan (i.e., program) for civil defense and as meeting other 
requirements for civil defense prescribed by or under provisions of the 
Act.
    (n) OMB Circular A-87. ``Cost Principles Applicable to Grants and 
Contracts with State and Local Governments,'' promulgated by the Office 
of Management and Budget, Executive Office of the President, as 
published in the Federal Register (46 FR 9548) and subsequent amendments 
or revisions. (See CPG 1-32, Financial Assistance Guidelines).
    (o) OMB Circular A-102. ``Uniform Administrative Requirements for 
Grants-in-aid to State and Local Governments,'' promulgated by the 
Office of Management and Budget, Executive Office of the President (42 
FR 45828) including amendments or revisions as published in the Federal 
Register. (See CPG 1-32, Financial Assistance Guidelines).
    (p) Emergency Operations Plan (EOP). State or local government 
Emergency Operations Plans identify the available personnel, equipment, 
facilities, supplies, and other resources in the jurisdiction and states 
the method or scheme for coordinated actions to be taken by individuals 
and government services in the event of natural, manmade and attack-
related disasters.
    (q) Personnel expenses. Necessary and essential civil defense 
expenses for personnel on the approved staffing pattern of a grantee or 
subgrantee (including but not necessarily limited to salaries, wages, 
and supplementary compensation and fringe benefits) for such employees 
appointed in accordance with State and local government laws and 
regulations under a system which meets Federal merit system and other 
applicable Federal requirements. Such expenses must be supported by job 
descriptions, payrolls, time distribution records, and other 
documentation as detailed in CPG 1-3. Personnel compensation and other 
costs incurred with regard to employees who are not on the civil defense 
staff but whose work serves the civil defense agency (e.g., State's 
budget and accounting office) may be charged as civil defense expense to 
the extent covered therefore in a federally approved indirect cost 
allocation plan.
    (r) Political subdivisions. Local governments, including but not 
limited to cities, towns, incorporated communities, counties or 
parishes, and townships.
    (s) Regional Director. A FEMA official delegated authority to 
exercise specified functions as they apply to grantees and subgrantees, 
within the geographical area of a particular region as identified 
(including address) in 44 CFR part 2.

[[Page 533]]

    (t) State. Any of the actual States, the District of Columbia, the 
Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana 
Islands, and the territories of American Samoa, Guam, and the Virgin 
Islands.
    (u) State administrative plan (OMB 3067-0138). A one-time submission 
with amendments as necessary to keep it current, the plan is a formal 
description of each participating State's total civil defense program 
and of related State and local laws, executive directives, rules, and 
plans and procedures, including personnel standards administered on a 
merit basis, updated emergency operations plans, travel regulations, 
indirect cost allocation plans and other information necessary to 
reflect the total civil defense program throughout the State. The plan 
also includes without limitation documentation as to administrative and 
financial systems to assure compliance with uniform grant-in-aid 
administrative requirements for States and subgrantees as required under 
OMB Circular A-102 and with other requirements relevant to the 
eligibility of the State and its political subdivisions for 
participation in financial assistance programs for civil defense 
purposes. Detailed requirements are prescribed in CPG 1-3. (Also see 
Sec. 302.3.)
    (v) Statement of work. Formal identification of specific actions to 
be accomplished by a State and its political subdivisions during the 
fiscal year for which Federal funds are being requested by the State. 
Submission is made to the FEMA Regional Director as part of the CCA 
Program Narrative.
    (w) Subgrantee. A political subdivision of a State listed in the 
State's annual submission (or amendments thereto) as approved by the 
grantor agency (including any grantor agency-approved amendments 
thereto) as eligible to receive a portion of the Federal financial 
contribution provided for use within the State. The term includes Indian 
tribes when the State has assumed jurisdiction pursuant to State law and 
tribal regulations.

[48 FR 44211 Sept. 28, 1983, as amended at 51 FR 12520, Apr. 11, 1986]



Sec. 302.3  Documentation of eligibility.

    In order to remain eligible for Federal financial contributions 
under the regulations in this part, each State must have on file with 
FEMA a current State administrative plan, an emergency operations plan 
for civil defense, and an annual submission (including a statement of 
work) which have been approved by the Regional Director as being 
consistent with the national plan (i.e., program) for civil defense and 
as meeting the requirements of the regulations in this part and CPG 1-3. 
A State may allocate a portion of its EMA funds to an Indian tribe as a 
subgrantee where the State has assumed jurisdiction pursuant to State 
law and tribal regulations.
    (a) State administrative plans. Every State has a State 
administrative plan file with FEMA and is required to keep the plan 
current through amendments as necessary. Such plans and amendments shall 
be reviewed by the Regional Director, who will advise the State in 
writing as to the effect, if any, changes will have on the continued 
eligibility of the State and its subgrantees. The Regional Director 
shall not, however, approve any amendments that would result in failure 
of the plan to meet these criteria:
    (1) Provides for and is, pursuant to State law, in effect in all 
political subdivision of the State, mandatory on them, and, unless 
waived by the Director under section 204 of the Intergovernmental 
Cooperation Act of 1968 (42 U.S.C. 4214), administered or supervised by 
a single State administrative agency. In demonstrating that the State 
administrative plan for civil defense is in effect in all political 
subdivisions of the State and mandatory on them, the plan shall contain 
references to the applicable State statutes and local ordinances, 
executive orders and directives, and rules and regulations at the State 
and local level that establish the civil defense authority, structure, 
plans, and procedures, including those relating to emergency operations, 
throughout the State.
    (2) Provides assurance of nonfederal contributions at least equal to 
Federal funding for necessary and essential costs eligible under this 
program from any source consistent with State law,

[[Page 534]]

but not from another Federal source unless Federal law specifically 
authorizes the use of funds from such Federal source as part of the 
State's share.
    (3) Provides for the development of State and local government civil 
defense emergency operations plans pursuant to the standards approved by 
the Director.
    (4) Provides for the employment by the State of full-time civil 
defense director or deputy director.
    (5) Provides for the establishment and maintenance of methods of 
personnel administration in public agencies administering or supervising 
the civil defense program, at both the State and local government 
levels, in conformity with the Standards for a Merit System of Personnel 
Administration (5 CFR part 900), which incorporate the Intergovernmental 
Personnel Act Merit Principles (Pub. L. 91-648, section 2, 84 Stat. 
1908) prescribed by the Office of Personnel Management pursuant to 
section 208 of the Intergovernmental Personnel Act of 1970, as amended.
    (6) Provides for the establishment of safeguards to prohibit State 
and local government employees from using their positions for a purpose 
that is or gives the appearance of being motivated by desire for private 
gain for themselves or others, particularly those with whom they have 
family, business, or other ties.
    (7) Provides that the State shall make such reports (including 
without limitation financial reports) in such form and content as the 
Director may require.
    (8) Provides that the State and all subgrantees shall retain, in 
accordance with OMB Circular A-102, and make available to duly 
authorized representatives of the Director and the U.S. Comptroller 
General all books, records, and papers pertinent to the grant program 
for the purpose of making audits, examinations, excerpts, and 
transcripts necessary to conduct audits.
    (9) Provides for establishment and maintenance of a financial 
management system of grant-supported activities of the State and all 
subgrantees which meets the federally prescribed standards promulgated 
in ``Standards for Grantee Financial Management Systems,'' Attachment G 
of OMB Circular A-102.
    (10) Provides for establishment and maintenance of procedures for 
monitoring and reporting grant program and projet performance of the 
State and its subgrantees which meet the federally prescribed standards 
promulgated in Attachment I of OMB Circular A-102.
    (11) Provides for the establishment and maintenance at the State 
level and by subgrantees of property management systems in accordance 
with the federally prescribed standards set forth in Attachment N of OMB 
Circular A-102.
    (12) Provides for the establishment and maintenance at the State 
level and by subgrantees of systems for the procurement of supplies, 
equipment, construction, and other services, with the assistance of 
grant funds, in accordance with federally prescribed standards set forth 
in Attachment O of OMB Circular A-102.
    (13) Provides for disbursement of the appropriate share of the 
Federal grant to the State's subgrantees in accordance with requirements 
detailed in CPG 1-3.
    (14) Provides for the State's supervision and review of the civil 
defense plans, programs, and operations of its subgrantees to obtain 
conformity and compliance with Federal requirements and goals set forth 
or referenced in the regulations in this part and as detailed in CPG 1-
3.
    (15) Contains a Statement of Compliance with grantor agency 
regulations relating to nondiscrimination in FEMA programs (see 44 CFR 
part 7).
    (16) Provides for timely submission to the appropriate Regional 
Director of amendments to the administrative plan as necessary to 
reflect the current laws, regulation, criteria, plans, methods, 
practices, and procedures for administration of the State's civil 
defense program and those of its subgrantees.
    (17) Conforms to other Federal standards and requirements set forth 
or referenced in the regulations in this part and as detailed in CPG 1-
3.
    (18) Provides for performance of independent organizationwide audits 
by

[[Page 535]]

State and local governments that receive EMA funds of their financial 
operations, including compliance with certain provisions of Federal law 
and regulation.
    (b) Emergency Operations Plans (EOP's). (1) Each participating State 
shall have an EOP approved by the Regional Director and conforming with 
the requirements for plan content set forth in this part and in CPG 1-3, 
and in CPG 1-8 ``Guide for the Development of State and Local Emergency 
Operations Plans'' and in CPG 1-8A, ``Guide for the Review of State and 
Local Emergency Operations Plans,'' which plan must provide for 
coordinated actions to be undertaken throughout the State in the event 
of attack and in the event of other disasters.
    (2) Each subgrantee jurisdiction shall have a local EOP which 
conforms with the requirements for plan content as set forth in CPG 1-3 
and CPG 1-8 and CPG 1-8A, and which has been approved by the local chief 
executive or other authorized official and accepted by the Governor or 
other authorized State official as being consistent with the State's 
EOP.
    (c) Annual submission. Each State should include in its annual CCA 
application the amount of EMA funding requested (see Sec. 302.5(c)). In 
order to participate for a particular Federal fiscal year, however, each 
State must also, within 60 days of receipt or notice of a formal 
allocation made pursuant to the criteria set forth in Sec. 302.5 and in 
accordance with procedures and criteria specified in CPG 1-3, aubmit to 
the Regional Director an approvable annual submission which includes:
    (1) A request or amended request for a financial contribution from 
FEMA in a specified amount for civil defense personnel and 
administrative expenses; (see Sec. 302.5 (d) through (h)).
    (2) Unless previously submitted for the particular Federal fiscal 
year, a statement of work for the State and proposed subgrantees or 
amendments to a statement of work previously submitted under the CCA.
    (3) Staffing patterns (including new or revised job descriptions not 
previously submitted) on forms prescribed by FEMA for the civil defense 
organizations of the State and proposed subgrantees; and
    (4) Any amendments to the State administrative plan required to 
reflect current status.
    (d) Approval of State administrative plan and annual submission. If 
the State administrative plan and the annual submission are determined 
to be approvable, the Regional Director will so notify the State in 
writing. The State administrative plan is a one-time submission. Unless 
amendments are necessary to meet Federal standards prescribed in the 
regulations in this part or in CPG 1-3 or to reflect changes in the 
State's administrative structure, procedures, criteria, or activities, 
or unless a portion were conditionally approved by the Regional Director 
as provided for in paragraph (e) of this section, no approval regarding 
the State administrative plan will be required for a State which 
participated for the preceding Federal fiscal year.
    (e) Agreement for contribution. Approval pursuant to procedures and 
criteria described in this part and in CPG 1-3 of an annual submission 
of a State whose administrative plan is approved and current shall 
constitute agreement between FEMA and the State as grantee for its 
participation and that of its subgrantees in this program during the 
Federal fiscal year covered by the approved annual submission on the 
basis of the requirements and conditions prescribed in this part, in CPG 
1-3, and in other federally promulgated criteria referenced in this 
part. Refusal or failure to comply with such requirements and conditions 
may result in the grantor agency cancelling, terminating, or suspending 
the grant, in whole or in part, and refraining from extending any 
further assistance to the grantee or subgrantee until satisfactory 
assurance of future compliance has been received.
    (f) Disapproval or conditional approval. If a State's administrative 
plan or annual submission is disapproved, the Regional Director will 
advise the State in writing, including the reasons for such disapproval 
and the revisions required for approval. The State shall have 30 days 
from date of such notification in which to submit its revisions. In the 
event more time is required in which to

[[Page 536]]

place the revisions into effect, the Regional Director may conditionally 
approve the State administrative plan or annual submission subject to 
the specified conditions to be met within a specified time, as agreed by 
the State and FEMA.
    (g) Appeals. (1) Appeal from a Regional Director's disapproval of a 
State administrative plan or an annual submission or other final action 
as unjustified under the criteria in CPG 1-3 may be made by letter to 
the Associate Director, State and Local Programs and Support (FEMA), 
signed by an authorized State official and submitted through the 
Regional Director. Such appeal letter shall be mailed or otherwise 
transmitted so as to reach the Regional Director within 30 days after 
receipt of the notification of disapproval. Failure to file its appeal 
on time may result in withdrawal of the State's allocation and the 
proposed funding being reallocated by the Director.
    (2) A local jurisdiction that regards the final action on its 
subgrant made by a State as unjustified under the criteria in CPG 1-3 
may submit an appeal through the State to the Regional Director. Upon 
receipt of such an appeal, the Regional Director shall forward the 
letter, together with all available pertinent documentation from the 
Regional Director's files and any additional documentation submitted by 
the local jurisdiction in support of its appeal, to the Associate 
Director, State and Local Programs and Support, for review and 
determination. The appeal shall contain all of the exceptions being 
taken by the State or local jurisdiction, and no exceptions will be 
determined piecemeal.
    (3) No portion of the appellant State's allocation shall be 
reallocated by FEMA, and no portion of a local jurisdiction's allocation 
shall be reallocated by the State, pending determination of its appeal 
by the Director. The State and local jurisdiction (if applicable) will 
be notified in writing of the Director's decision, including a statement 
of the reasons therefor.

(Approved by Office of Management and Budget under control number 3067-
0138)


[48 FR 44211 Sept. 28, 1983, as amended at 51 FR 12520, Apr. 11, 1986]



Sec. 302.4  Merit personnel systems.

    (a) Background. Section 208 of the Intergovernmental Personnel Act, 
as amended (42 U.S.C. 4728) authorizes Federal agencies to require, as a 
condition of participation in Federal assistance programs, systems of a 
personnel administration consistent with personnel standards prescribed 
by the Office of Personnel Management (OPM). OPM has promulgated 
Standards for a System of Personnel Administration (5 CFR part 900) 
which prescribe intergovernmental personnel standards on a merit basis 
as a condition of eligibility in the administration of grant programs. 
OPM has approved FEMA adoption of these standards by the regulations in 
this part.
    (b) Standard. Participation by each grantee and each subgrantee 
under the program covered in this part is subject to compliance with the 
following conditions regarding merit personnel systems:

    Methods of personnel administration will be established and 
maintained in public agencies administering or supervising the 
administration of the civil defense program in conformity with the 
Standards for a Merit System of Personnel Administration 5 CFR part 900, 
which incorporate the Intergovernmental Personnel Act Merit Principles 
(Pub. L. 91-648, section 2, 84 Stat. 1909) prescribed by the Office of 
Personnel Management pursuant to section 208 of the Intergovernmental 
Personnel Act of 1970 as amended.


Section 302.3(a)(5) of this part provides, in part, that State 
administrative plans that fail to provide for fulfilling this condition 
are not approvable.



Sec. 302.5  Allocations and reallocations.

    (a) The Director shall allocate the entire amount of funds available 
for the purposes of this program from the appropriation for each fiscal 
year. The allocation made to each State represents the total amount of 
funds available to pay the Federal share of necessary and essential 
civil defense personnel and administrative expenses of the State and its 
participating subdivisions during the fiscal year.
    (b) The first calculation for developing the allocation for each 
State will be a formula distribution in accordance with section 205(d) 
of the Act, made by applying the following percentages to

[[Page 537]]

the total sum of Emergency Management Assistance in the President's 
budget request to Congress:
    (1) Fifty (50) percent will be allocated on the basis of the prior-
year State allocations, in fulfilment of the statutory requirement to 
give due regard to ``the relative state of development of civil defense 
readiness of the State'' (State and local levels).
    (2) Thirty-three (33) percent will be allocated on the basis of the 
ratio of the State's population to the national population (50 States, 
District of Columbia, and Puerto Rico), in fulfilment of the statutory 
requirements to give due regard to ``population'' and to ``the 
criticality of target and support areas and the areas which may be 
affected by natural disasters with respect to the development of the 
total civil defense readiness of the Nation.''
    (3) Fifteen (15) percent will be divided equally among the 50 
States, the District of Columbia, and Puerto Rico.
    (4) In consonance with the statutory provision allowing the Director 
to prescribe other factors concerning the State allocations, the 
remaining two (2) percent will be held temporarily in reserve, to be 
used first to fund the four territories of the Virgin Islands, American 
Samoa, Guam, and the Commonwealth of the Northern Mariana Islands. 
Conditions peculiar to those areas make strict application of the 
mathematical formula in Sec. 302.5(b) inequitable. Therefore, the 
Director will consider prior-year allocations, percentage of total 
United States population, and the factors set out in Sec. 302.5(e) (1), 
(2), (4), and (5) in determining their allocations. The remaining 
balance of the reserve fund will then be used to restore any State which 
would receive less by formula share than its formula share for the 
previous fiscal year, provided that the reserve balance is sufficient to 
do this for all such States. Any remaining balance after this has been 
done will constitute a supplemental fund from which the Director will 
consider State requests for additional funding and the needs of any 
interstate civil defense authorities.
    (c) For initial planning purposes only, each State will then be 
informed of the figure by the Regional Director. The State will base its 
initial EMA application upon that figure but may request a smaller 
amount or with appropriate justification a larger amount.
    (d) The amount requested by the State shall not exceed 50 percent of 
its estimate of necessary and essential State and local personnel and 
administrative expenses for the fiscal year.
    (e) The formula distribution shall be reviewed and evaluated, and 
adjusted as appropriate, by the Director, based on the current situation 
in each State, the requests of all States, and recommendations by the 
Regional Directors. The Director will consider the following five 
factors:
    (1) The ability of the State and its subgrantees to effectively 
expend such an amount for necessary and essential civil defense 
personnel and administrative purposes. Past performance is a factor in 
this determination.
    (2) Special circumstances existing in the State at the time of 
allocating which require unusual expenditures for civil defense.
    (3) Conditions peculiar to the State which make strict application 
of mathematical formula inequitable either to that State or other 
States.
    (4) The relative cost of civil defense personnel and administrative 
services in that State; that is, whether such costs are considerably 
above or below the national average for similar services and expenses.
    (5) Substantial changes in the civil defense readiness of the State 
not reflected by its recent civil defense expenditures.
    (f) In September of each year, based on applications received and 
recommendations by the Regional Directors, the Director will make a 
tentative allocation to the States. This will include adjustments for 
States that have indicated they will not be using the total of the 
formula distribution amount. States can then revise their earlier plans 
and applications to more nearly reflect the level of funding expected to 
become available.
    (g) A State may provide to the Regional Director a preliminary 
annual submission in an amount not to exceed its tentative allocation.
    (h) By September 30 (or as soon thereafter as feasible), the 
Director will make a formal allocation based on,

[[Page 538]]

or subject to, appropriation by Congress and allotment of the funds. 
This allocation for each State may include any additional amounts from 
the reserve portion of the EMA funds, and shall be in accordance with 
the regulations in this part and CPG 1-3.
    (i) Upon the appropriation becoming available, and if requested by a 
State, the Regional Director may approve such State's preliminary annual 
submission (if found to meet all requirements in this part and CPG 1-3) 
in an appropriate amount which does not exceed the amount of the State's 
share of the Director's formal allocation of the Federal appropriation. 
An award document obligating Federal funds on the basis of the approved 
preliminary annual submission may be executed in accordance with the 
provisions of CPG 1-3.
    (j) Based on and within 60 days after notification of its formal 
allocation, each State must provide to the Regional Director a final 
annual submission which meets all requirements in this part and CPG 1-3. 
If no changes are necessary, a State and the Regional Director may adopt 
in writing the State's preliminary annual submission as its final annual 
submission. If no award document was executed based on a State's 
preliminary annual submission, such document will be executed on the 
basis of that State's approved final annual submission.
    (k) With regard to any State whose award document was executed 
pursuant to a preliminary annual submission covering only part of its 
formal allocation, upon approval (by the Regional Director) of the final 
annual submission (including a revised statement of work supporting the 
additional funding request) the Regional Director shall execute an 
amended award document obligating the balance of such State's formal 
allocation.
    (l) After being advised of its annual formal allocation, if a State 
fails to submit, within 60 days, an approvable annual submission in the 
amount of its allocation, the Regional Director may reallocate the 
unused portion to other States in the region in such amounts as in his/
her judgment will best assure adequate development of the civil defense 
capability of the Nation. The exception to this authority is in the 
event a State, or local jurisdiction, refuses to participate in attack 
preparedness activities. EMA funds withheld or returned for that reason 
are to be released to headquarters for reallocation on a national basis. 
In addition, the Regional Director may from time to time reallocate the 
amounts released by a State from its allocation as no longer being 
required for utilization in accordance with an approved annual 
submission and award document.
    (m) Immediate notice to the headquarters EMA Program Manager of 
State reallocations is required in the form of copies of EMA-approved 
Annual Submission amendment documents, accompanied by copies of 
assistance award/amendment documents signed by regional and State 
authorized officials of both the releasing and recipient States.
    (n) There is no dollar ceiling on the amount of funds that may be 
reallocated among States in a region. However, at any time that there 
are funds surplus to the eligible needs of the States within a region, 
those funds should be promptly released to headquarters for reallocation 
to other States with unfunded additional requirements.
    (o) On July 1 of each fiscal year, the authority to reallocate EMA 
funds shall revert to the Director. In addition, any excess EMA funds 
available on that date, or that become available during the remainder of 
the fiscal year, are to be promptly released to headquarters for 
reallocation by the Director.

[48 FR 44211 Sept. 28, 1983, as amended at 51 FR 12521, Apr. 11, 1986; 
51 FR 43924, Dec. 5, 1986; 56 FR 29905, July 1, 1991]



Sec. 302.6  Fiscal year limitation.

    Federal appropriations for the program covered by the regulations in 
this part are limited for obligation on a Federal fiscal year basis. 
Each annual submission (or amendment thereto) which results in a change 
in scope (e.g., an increase in the amount of funds other than a cost 
overrun) must be approved during the Federal Fiscal year for which the 
funds to be charged were appropriated. Valid expenses incurred by a 
State or its subgrantee during the

[[Page 539]]

fiscal year but before obligation by FEMA of funds under this program 
may qualify for payment of a Federal financial contribution out of the 
funds subsequently appropriated for that fiscal year.



Sec. 302.7  Use of funds, materials, supplies, equipment, and personnel.

    Financial contributions provided under the authority of section 205 
of the Act are provided for necessary and essential State and local 
civil defense personnel and administrative expenses as prescribed by the 
regulations in this part and the provisions of CPG 1-3, and are 
obligated only on the basis of documentation justifying such need.
    (a) Emergencies. In addition to such civil defense use, Federal 
funds obligated under a grantee's approved annual submission may be 
used, to the extent and under such terms and conditions as prescribed by 
the Director in CPG 1-3, for providing emergency assistance, including 
the use of civil defense personnel, organizational equipment, materials, 
and facilities, in preparation for and response to actual attack-related 
events or natural disasters (including manmade catastrophies).
    (b) Limitations. Section 207 of the Act allows use of funds under 
the Act, including those for this program, for natural (including 
manmade) disaster preparedness and response purposes only to the extent 
that such use is consistent with, contributes to, and does not detract 
from attack-related preparedness (reference 44 CFR part 312).



Sec. 302.8  Waiver of ``single'' State agency requirements.

    Section 205 of the Act requires that plans for civil defense of the 
United States be administered or supervised by a single State agency (50 
U.S.C. App. 2286). Notwithstanding such law, section 204 of the 
Intergovernmental Cooperation Act of 1968 (42 U.S.C. 4214) provides 
authority for the Director as head of the grantor agency, upon the 
State's request, to waive the single State agency requirement and to 
approve other State administrative structure or arrangements, upon 
adequate showing that the requirement prevents the establishment of the 
most effective and efficient organizational arrangements within the 
State government. First, however, the Director must have found that the 
objectives of the Act (50 U.S.C. app. 2251 et seq.) will not be 
endangered by the use of such other State structure or arrangements. 
Attachment D of OMB Circular A-102 requires that such requests be given 
expeditious handling by the grantor agency and that, whenever possible, 
an affirmative response be made.

[48 FR 44211 Sept. 28, 1983, as amended at 51 FR 12521, Apr. 11, 1986]



PART 303--PROCEDURE FOR WITHHOLDING PAYMENTS FOR FINANCIAL CONTRIBUTIONS UNDER THE FEDERAL CIVIL DEFENSE ACT--Table of Contents




Sec.
303.1  Purpose.
303.2  Definitions.
303.3  Scope.
303.4  Notice of intention to withhold payments.
303.5  Notice of hearing.
303.6  Hearings.
303.7  Withholding of payments.

    Authority: 50 U.S.C. app. 2251 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.

    Source: 40 FR 16314, Apr. 11, 1975, unless otherwise noted. 
Redesignated at 44 FR 56173, Sept. 28, 1979.



Sec. 303.1  Purpose.

    The purpose of the regulation in this part is to establish, pursuant 
to section 401(h) of the Act, a procedure by which the Director may 
withhold payments of financial contributions to States or persons, or 
may limit such payments to specified programs or projects.



Sec. 303.2  Definitions.

    As used herein the following terms shall have the following 
meanings:
    (a) Act. The Federal Civil Defense Act of 1950, as amended (50 
U.S.C. App. 2251 et seq.).
    (b) FEMA. Federal Emergency Management Agency.
    (c) Director. Director, FEMA.
    (d) State. The several States, the District of Columbia, Puerto 
Rico, and the Territories and possessions of the United States.

[[Page 540]]

    (e) Person. A political subdivision of any State, or combination or 
group thereof; any interstate civil defense authority established 
pursuant to section 201(g) of the Act, or any person, corporation, 
association or other entity of any nature whatsoever, including but not 
limited to, instrumentalities of States and political subdivisions.

[40 FR 16314, Apr. 11, 1975. Redesignated at 44 FR 56173, Sept. 28, 
1979, as amended at 50 FR 40007, Oct. 1, 1985]



Sec. 303.3  Scope.

    (a) Section 401(h) of the Act authorizes the Director to withhold 
payment of any financial contribution under section 201 or section 205 
of the Act to a State or a person, or to limit payments to specified 
programs or projects upon (1) a finding by the Director of failure by a 
State or person to expend funds in accordance with the regulations, 
terms, and conditions established under the Act for approved civil 
defense plans, programs or projects; and (2) notification to the State 
or person that certain payments for approved financial contributions 
will not be made until the Director is satisfied that there will no 
longer be failure by a State or person to expend funds in accordance 
with such regulations, terms, and conditions. Prior to the making of 
such finding and issuance of the notification, the State or person must 
have been given reasonable notice and opportunity for hearing.
    (b) The regulations in this part specify (1) the notice which must 
be given to a State or person, (2) the procedures for obtaining a 
hearing, and (3) the terms of the notification to the State or person 
that further payments will not be made if the Director determines, after 
notice and hearing that there has been a failure to expend funds in 
accordance with regulations, terms, and conditions established pursuant 
to the Act.



Sec. 303.4  Notice of intention to withhold payments.

    (a) Whenever the Director has reason to believe that a State or 
person has failed to expend funds in accordance with the regulations, 
terms, or conditions governing a Federal financial contribution 
established pursuant to the Act, he shall notify the State and person, 
where applicable, of such fact and of his intention to withhold any 
further contributions or payments, or contributions or payments for 
specific programs or projects, unless the alleged failure is 
satisfactorily explained, or until he is satisfied that there is no 
longer such failure to comply.
    (b) The notice shall specify (1) the date on which he will stop or 
withhold further payments; (2) the regulations, terms, or conditions 
which he believes have not been complied with in the expenditure of 
funds; and (3) the contributions or payments which he intends to 
withhold; and shall inform the State and person, where applicable, of 
the right to obtain a hearing.
    (c) This notice shall be delivered by certified mail, return receipt 
requested.



Sec. 303.5  Notice of hearing.

    If, within 15 days after receipt of the notice described in 
Sec. 303.4, the State or person requests the Director to hold a hearing, 
the Director will set the matter for hearing. The Director will give the 
State (and person, where applicable) reasonable notice of the time and 
place of the hearing.



Sec. 303.6  Hearings.

    (a) Any hearing under this part shall be held before the Director 
provided that, in his discretion, the Director may designate a hearing 
officer who will take evidence and certify, to the Director, the entire 
record, including recommended findings, and a proposed decision.
    (b) The State and person, where applicable, shall be given full 
opportunity to present their position, orally and in writing.



Sec. 303.7  Withholding of payments.

    (a) If after the hearing, or after opportunity therefor, the 
Director finds that there has been a failure to expend funds in 
accordance with the regulations, terms, and conditions established 
pursuant to the Act, the Director will withhold such contributions and 
payments as he may consider advisable until the failure to expend funds 
in accordance with the regulations, terms, and conditions has been

[[Page 541]]

corrected or he is satisfied that there will no longer be any such 
failure.
    (b) If, upon the expiration of the 15 day period stated in 
Sec. 303.5, a hearing has not been requested, the Director may issue the 
finding described in paragraph (a) of this section, and thereupon 
withhold contributions and payments until he is satisfied that there 
will no longer be any failure to expend funds in accordance with 
regulations, terms, and conditions governing a Federal contribution for 
an approved program or project.



PART 304--CONSOLIDATED GRANTS TO INSULAR AREAS--Table of Contents




Sec.
304.1  Purpose.
304.2  Definitions.
304.3  Conditions for a consolidated grant.
304.4  Allocations.
304.5  Audits and records.

    Authority: 50 U.S.C. app. 2251 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.

    Source: 43 FR 39776, Sept. 7, 1978, unless otherwise noted. 
Redesignated at 44 FR 56173, Sept. 28, 1979.



Sec. 304.1  Purpose.

    The purpose of the regulations in this part is to prescribe the 
basis under which the Federal Emergency Management Agency (FEMA) 
contributes Federal funds to an insular area through a consolidated 
grant.



Sec. 304.2  Definitions.

    Except as otherwise stated when used in the regulations of this 
part, the meaning of the listed terms are as follows:
    (a) Insular areas. The Virgin Islands, Guam, American Samoa, and the 
Government of the Northern Mariana Islands.
    (b) Consolidated grant. A grant by FEMA to any insular area through 
an allocation which combines funds for the State and local management 
program and the State and local maintenance and services program for a 
single Federal fiscal year.
    (c) FEMA guidance material. FEMA regulations (44 CFR chapter I), 
Civil Preparedness Guide (CPG) 1-3, and Civil Preparedness Circulars 
(CPC) as presently providing or hereafter amended or revised.

[43 FR 39776, Sept. 7, 1978. Redesignated at 44 FR 56173, Sept. 28, 
1979, as amended at 48 FR 44554, Sept. 29, 1983]



Sec. 304.3  Conditions for a consolidated grant.

    (a) In order to participate, an insular area must submit a (one-
time) administrative plan as provided for in FEMA guidance material (to 
be maintained in current status) and must sign a (one-time) civil rights 
assurance and a (one-time) grant agreement agreeing to comply with 
Federal requirements.
    (b) An insular area need not submit an application for a 
consolidated grant, but must submit an annual program paper which meets 
the requirements prescribed in FEMA guidance material.
    (c) Funds made available under a consolidated grant must be expended 
for State and local management program expenses and/or State and local 
maintenance and services program expenses as defined and described in 
FEMA guidance material. Each participating insular area will determine 
the proportion in which funds granted to it will be allocated between 
the two programs.
    (d) Participating insular areas need not provide matching funds for 
consolidated grants.

[43 FR 39776, Sept. 7, 1978. Redesignated at 44 FR 56173, Sept. 28, 
1979, as amended at 50 FR 40007, Oct. 1, 1985]



Sec. 304.4  Allocations.

    For each Federal fiscal year concerned, the Director, FEMA, shall 
allocate to each participating insular area an amount not less than the 
sum of grants for the two programs which the Director, FEMA, has 
determined such insular area would otherwise be entitled to receive for 
such fiscal year.



Sec. 304.5  Audits and records.

    (a) Audits. FEMA will maintain adequate auditing, accounting and 
review procedures as outlined in FEMA guidance material and OMB 
Circulars No. A-73 and A-102.
    (b) Records. Financial records, supporting documents, statistical 
records, and all other records pertinent to a consolidated grant shall 
be retained for

[[Page 542]]

a period of three years from submission of final billing and shall be 
available to the Director, FEMA, and the Comptroller General of the 
United States, all as prescribed in FEMA guidance material and in 
accordance with OMB Circular A-102 (42 FR 45828-45891).



PART 305  [RESERVED]






PART 306--OFFICIAL CIVIL DEFENSE INSIGNE--Table of Contents




Sec.
306.1  Purpose.
306.2  Definitions.
306.3  Prescribed insigne.
306.4  Official articles.
306.5  Manufacture, reproduction and display of the prescribed insigne.
306.6  Distribution, issuance, and retail sale of the prescribed 
          insigne.
306.7  Prohibited use of the prescribed insigne.
306.8  Violations.

    Authority: 50 U.S.C. app. 2251 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.

    Source: 43 FR 26568, June 21, 1978. Redesignated at 44 FR 56173, 
Sept. 28, 1979, unless otherwise noted.



Sec. 306.1  Purpose.

    (a) The purpose of the regulations in this part is to prescribe an 
insigne which may be used by any State or local civil defense 
organization and by persons engaged in civil defense activities approved 
by such organizations and to establish requirements for the 
reproduction, manufacture, display, sale, possession, and wearing 
thereof.
    (b) This does not mean that a State or local civil defense, civil 
preparedness, or emergency services organization may not, under its own 
authority, establish and use its own insigne, seal, or similar device. 
There is no attempt to preempt the field.



Sec. 306.2  Definitions.

    Except as otherwise stated, the following terms shall have the 
following meanings when used in the regulations in this part:
    (a) Director, FEMA means the Director, Federal Emergency Management 
Agency.
    (b) Civil Defense Agency means a unit of a State or of a political 
subdivision established pursuant to law and responsible for the 
development of those activities and measures which are authorized for 
civil defense organizations either under Federal or State or local law.
    (c) Civil Defense Director means the person or body having authority 
over a civil defense agency and any duly authorized designee of such 
person or body. Such term may refer either to a State Director or to the 
civil defense director of a political subdivision.
    (d) Official articles means articles designated as such by the 
Director, FEMA and embodying the prescribed insigne.
    (e) Organizational equipment means equipment (other than personal 
equipment) which the Director, FEMA determines is necessary to a civil 
defense organization for civil defense purposes and which is of such a 
nature as to require the contribution of Federal funds, but not 
including items of equipment which the local community normally utilizes 
in combating local disasters except when required in unusual quantities 
dictated by the requirements of civil defense plans.
    (f) State means any State, the District of Columbia, the 
Commonwealth of Puerto Rico, and any territory or possession of the 
United States.



Sec. 306.3  Prescribed insigne.

    (a) The prescribed insigne shall be the design covered under Letters 
Patent 129797, October 7, 1941, consisting of the ``CD'' symbol in 
bright red, centered within a white equilateral triangle superimposed 
upon a dark blue circle.
    (b) The prescribed insigne may be reproduced in the above colors, in 
black and white, or in the color of the surface upon which reproduced 
and one other color: Provided, That if the color of the surface or the 
ground is orange, the triangle shall not be blue. The intent of this 
restriction is that this insigne shall not be confused with the 
international civil defense sign established in the Protocol Additional 
to the Geneva Conventions of 12 August 1949, and Relating to the 
Protection of Victims of International Armed Conflicts (Protocol I) and 
Annexes.
    (c) Where appropriate, the name of a particular civil defense 
service, the

[[Page 543]]

State, or a political subdivision, may be spelled out in block letters 
on, in, or immediately surrounding the prescribed insigne.
    (d) The dimensions of the components of the prescribed insigne when 
the blue circle is three inches in diameter will approximate the 
following: The triangle will be equilateral two and one-quarter inches 
on a side, each of the letters in the ``CD'' symbol will be three-
sixteenth inches in thickness and will occupy a circle one and one-
eighth inches in diameter centered in the triangle. Other sizes of the 
prescribed insigne will be established by diameter of the blue circle 
only; to the extent that the diameter of the blue circle is greater or 
less than three inches, the dimensions of the other components shall be 
proportionately increased or decreased.
    (e) The following alteration or modification of the prescribed 
insigne is authorized pursuant to Sec. 306.5(d):

    Radio Amateur Civil Emergency Service. Superimposed on the official 
civil defense insigne a white jagged arrow edged in blue resembling a 
flash of lightning, symbolic of space radiation, containing the 
inscription ``Radio'' in blue letters, and extending from the upper 
right circumference of the blue circle and through the lower left-hand 
angle of the triangle. Below the triangle and within the blue circle is 
the inscription ``RACES'' in white letters.



Sec. 306.4  Official articles.

    (a) Official articles shall consist of the following articles 
embodying the insigne:
    (1) Arm bands.
    (2) Badges.
    (3) Hat bands.
    (4) Helmets.
    (5) Pennants, placards, plates, or stickers for aircraft, vehicles, 
or vessels.
    (6) Membership cards.
    (b) No person shall possess, display, wear, or use an official 
article unless such person is authorized to do so by the Director, FEMA 
or by a Civil Defense Director: Provided, That this prohibition shall 
not apply to the possession or display of official articles by a 
manufacturer, wholesaler, or retailer in the normal course of business, 
or to display of pennants, placards, plates, or stickers on aircraft, 
vehicles, or vessels designated for operational use by a Civil Defense 
Director.



Sec. 306.5  Manufacture, reproduction and display of the prescribed insigne.

    (a) Any individual, association or business entity may manufacture 
the prescribed insigne and official articles in compliance with these 
regulations.
    (b) The prescribed insigne may be manufactured, reproduced, and 
displayed only:
    (1) On official articles.
    (2) On organizational equipment.
    (3) On items of identification issued by a Civil Defense Director to 
permit necessary movement of persons, vehicles and equipment during a 
period of emergency operations.
    (4) On facilities and equipment designated for emergency operational 
use by a Civil Defense Director and on devices used for alerting the 
public in time of emergency.
    (5) On official letterheads, publications, posters, signs, 
advertisements, lapel pins, pennants, placards, flags, banners, 
certificates of membership and certificates of award used, issued, or 
authorized by a Civil Defense Agency or Civil Defense Director.
    (6) In connection with articles or advertisements in newspapers, 
magazines, or other publications, or in connection with television or 
other public information media: Provided, Such use is not intended to 
discredit the Federal Emergency Management Agency or a Civil Defense 
Agency, or to mislead, confuse, misrepresent, defraud, or does not 
erroneously confer the impression of endorsement, approval, or 
relationship to the Federal Emergency Management Agency or a Civil 
Defense Agency.
    (7) On the merit badge for ``Emergency Preparedness'' designed for 
and as authorized and awarded by the Boy Scouts of America, together 
with the reproduction of such merit badge on any publication or 
certificate of award to be used or issued by said organization in 
connection therewith.
    (8) On such other items, whether official articles or not, as may be 
designated or approved by the Director, FEMA in writing.

[[Page 544]]

    (c) Without limitation of the foregoing, the reproduction of the 
prescribed insigne in connection with any publication or article used 
for political purposes is prohibited.
    (d) No alteration or modification of the prescribed insigne may be 
made except as the Director may from time to time authorize.



Sec. 306.6  Distribution, issuance, and retail sale of the prescribed insigne.

    No distribution, issuance, or retail sale of the prescribed insigne 
or official articles shall be made except upon the authorization of a 
Civil Defense Director; the Director, FEMA; or in accordance with the 
regulations in this chapter.



Sec. 306.7  Prohibited use of the prescribed insigne.

    No person shall possess or wear the prescribed insigne or any other 
device in colorable imitation thereof with intent to deceive or mislead 
or for the purpose of inducing the false impression that such person is 
engaged in the performance of an authorized civil defense service or 
activity.



Sec. 306.8  Violations.

    The manufacture, possession, or wearing by any person of the 
prescribed insigne or any device in colorable imitation thereof 
otherwise than in accordance with these regulations shall be unlawful 
and shall subject such person to a fine of not more than $1,000 or 
imprisonment of not more than one year, or both.



PART 307  [RESERVED]






PART 308--LABOR STANDARDS FOR FEDERALLY ASSISTED CONTRACTS--Table of Contents




Sec.
308.1  Purpose and scope.
308.2  Definitions.
308.3  Contract award requirements.
308.4  Contract provisions.
308.5  Examination of payrolls.
308.6  Compliance.
308.7  Certification of compliance.

    Authority: 50 U.S.C. app. 2251 et seq.; Reorganization Plan No. 3 of 
1978; E.O. 12148.



Sec. 308.1  Purpose and scope.

    The regulations in this part are supplemental to those contained in 
29 CFR part 5 and together they prescribe the labor standards applicable 
to construction work financed with the assistance of a contribution of 
Federal funds made under the provisions of section 201(i) of the Federal 
Civil Defense Act of 1950, as amended (50 U.S.C. App. 2281) to any State 
(and political subdivision thereof, where applicable). The regulations 
in this part, to the extent that they vary from those published in 29 
CFR part 5, have been approved by the Secretary of Labor under 29 CFR 
part 5 to meet the particular needs of the Federal Emergency Management 
Agency. To assure full labor standards compliance reference should be 
made to the regulations contained in 29 CFR part 5 as well as those 
published herein.

[29 FR 12366, Aug. 28, 1964, as amended at 37 FR 2673, Feb. 4, 1972; 40 
FR 42736, Sept. 16, 1975. Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 308.2  Definitions.

    Except where otherwise clearly required by the context, each of the 
following terms shall have the meaning defined in this section when used 
in the regulations in this part:
    (a) Building or work. Construction activity as distinguished from 
manufacturing, furnishing of materials, or servicing and maintenance 
work; including without limitation, buildings, structures, and 
improvements of all types such as shelters, ramps, roadways, parking 
lots, tunnels, mains, power lines, pumping and generator stations, 
terminals, plants, rehabilitation and reactivation of plants, 
scaffolding, drilling, blasting, clearing, and landscaping. The 
manufacture or furnishing of materials, articles, supplies, or equipment 
is not a ``building'' or ``work'' within the meaning of the regulations 
in this part unless conducted in connection with and at the site of such 
building or work as defined hereunder.
    (b) Construction. All types of work done on a particular building or 
work at the site thereof, including without limitation, altering, 
repairing, remodeling, painting and decorating, the transporting of 
materials and supplies

[[Page 545]]

to or from the building or work by the employees of the construction 
contractor or the construction subcontractor, and the manufacturing or 
furnishing of materials, articles, supplies or equipment on the site of 
the building or work by persons employed by the contractor or the 
subcontractor.
    (c) Contract. Any contract which is entered into for actual 
construction, alteration, or repair, including painting and decorating, 
of a building or work financed with the assistance of any contribution 
of Federal funds made under the provisions of section 201(i) of the 
Federal Civil Defense Act of 1950, as amended (50 U.S.C. App. 2281).
    (d) Employed. Every person paid by a contractor or subcontractor in 
any manner for his labor on construction work financed with the 
assistance of any contribution of Federal funds made under the 
provisions of section 201(i) of the Federal Civil Defense Act of 1950, 
as amended (50 U.S.C. App. 2281) is ``employed'' and receiving 
``wages,'' regardless of any contractual relationship alleged to exist.

[29 FR 12366, Aug. 28, 1964. Redesignated at 44 FR 56173, Sept. 28, 
1979]



Sec. 308.3  Contract award requirements.

    The obligations of the State, and of any political subdivision 
joining the State in its application for a Federal financial 
contribution under section 201(i) or section 205 of the Federal Civil 
Defense Act of 1950, as amended (50 U.S.C. App. 2281, 2286), include, 
without limitation, the following:
    (a) The requirement that the State include, verbatim, in each 
contract involving construction work in excess of $2,000 and cause to be 
included, verbatim, in each subcontract thereunder, the provisions 
prescribed in Sec. 308.4 and cause to be attached the applicable wage 
determination decision of the Secretary of Labor.
    (b) The requirement that each advertisement of an invitation to bid 
shall indicate expressly that if the construction phase of the contract 
exceeds $2,000:
    (1) All laborers and mechanics employed by contractors or 
subcontractors in performance of the construction work shall be paid 
wages at rates not less than those determined by the Secretary of Labor 
in accordance with the Davis-Bacon Act, as amended (40 U.S.C. 276a et 
seq.), and every such employee shall receive compensation at a rate not 
less than one and one-half times his basic rate of pay for all hours 
worked in excess of eight hours in any calendar day or in excess of 
forty hours in any work-week, as the case may be, as provided in section 
201(i) of the Federal Civil Defense Act of 1950, as amended (50 U.S.C. 
App. 2281) and in the Contract Work Hours Standards Act (76 Stat. 357) 
and,
    (2) Bid specifications shall contain the labor standards provisions 
prescribed in Sec. 308.4 of this part and shall have attached thereto 
the wage determination decision of the Secretary of Labor applicable to 
the project.

[38 FR 31526, Nov. 15, 1973, as amended at 40 FR 42736, Sept. 16, 1975. 
Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 308.4  Contract provisions.

    Each contract involving construction work in excess of $2,000 and 
all subcontracts thereunder shall include as a part thereof the 
following labor standards provisions, in completed form, verbatim:
    (a) Minimum wages. (1) All mechanics and laborers employed by the 
contractor or subcontractor in the performance of construction work 
hereunder will be paid unconditionally and not less than once a week and 
without subsequent deduction or rebate on any account, except such 
payroll deductions as are permitted by the Copeland Regulations (29 CFR 
part 3) of the Secretary of Labor, the full amounts due at time of 
payment computed at wage rates not less than those contained in the wage 
determination decision of the Secretary of Labor which is attached 
hereto and made a part hereof, regardless of any contractual 
relationship which may be alleged to exist between the contractor or 
subcontractor and such laborers and mechanics; and the wage 
determination decision shall be posted by the contractor at the site of 
the work in a prominent place where it can be easily seen by the 
workers. For the purpose of this clause, contributions made or costs 
reasonably anticipated under section 1(b)(2) of the Davis-Bacon Act on 
behalf of laborers or mechanics

[[Page 546]]

are considered wages paid to such laborers or mechanics, subject to the 
provisions of 29 CFR 5.5(a)(1)(iv). Also for the purpose of this clause, 
regular contributions made or costs incurred for more than a weekly 
period under plans, funds, or programs, but covering the particularly 
weekly period, are deemed to be constructively made or incurred during 
such weekly period.
    (2) The contracting officer of the (write in the name of the State 
or political subdivision) shall require that any class of laborers or 
mechanics, including apprentices and trainees, which is not listed in 
the wage determination and which is to be employed under the contract, 
shall be classified or reclassified conformably to the wage 
determination, and a report of the action taken shall be sent by the 
State through the Federal Emergency Management Agency to the Secretary 
of Labor. In the event the interested parties cannot agree on the proper 
classification or reclassification of a particular class of laborers and 
mechanics, including apprentices and trainees, to be used, the question 
accompanied by the recommendation of the contracting officer of the 
(write in the name of the State or political subdivision) shall be 
referred by the State through the Federal Emergency Management Agency to 
the Secretary of Labor for final determination.
    (3) The contracting officer of the (write in the name of the State 
or political subdivision) shall require, whenever the minimum wage rate 
prescribed in the contract for a class of laborers or mechanics includes 
a fringe benefit which is not expressed as an hourly wage rate and the 
contractor is obligated to pay a cash equivalent of such a fringe 
benefit, an hourly cash equivalent thereof to be established. In the 
event the interested parties cannot agree upon a cash equivalent of the 
fringe benefit, the question accompanied by the recommendation of the 
contracting officer of the (write in the name of the State or political 
subdivision) shall be referred by the State through the Federal 
Emergency Management Agency to the Secretary of Labor for determination.
    (4) If the contractor does not make payments to a trustee or other 
third person, he may consider as part of the wages of any laborer or 
mechanic the amount of any costs reasonably anticipated in providing 
benefits under a plan or program of a type expressly listed in the wage 
determination decision of the Secretary of Labor which is a part of this 
contract: Provided however, The Secretary of Labor has found, upon the 
written request of the contractor, that the applicable standards of the 
Davis-Bacon Act have been met. The Secretary of Labor may require the 
contractor to set aside in a separate account assets for the meeting of 
obligations under the plan or program.
    (b) Overtime requirements. (As used in this clause, the terms 
``laborers'' and ``mechanics'' include watchmen and guards.) No 
contractor or subcontractor contracting for any part of the contract 
work which may require or involve the employment of laborers or 
mechanics shall require or permit any laborer or mechanic to be employed 
on such work in excess of 8 hours in any calendar day or in excess of 40 
hours in any workweek unless such laborer or mechanic receives 
compensation at a rate of not less than 1\1/2\ times his basic rate of 
pay for all hours worked in excess of 8 hours in any such calendar day 
or in excess of 40 hours in any such workweek, as the case may be.
    (c) Violations; liability for unpaid wages; liquidated damages. In 
the event of any violation of paragraph (a) or (b) of this section the 
contractor and any subcontractor responsible therefor shall be liable to 
any affected employee for his unpaid wages. In addition, in the event of 
any violation of paragraph (b) of this section, such contractor and 
subcontractor shall be liable to the United States (in the case of work 
under contract for the District of Columbia or a territory, to such 
District or to such territory) for liquidated damages. Such liquidated 
damages shall be computed, with respect to each individual laborer or 
mechanic (including watchmen and guards) employed in violation of 
paragraph (b) of this section, in the sum of $10 for each calendar day 
on which such employee was required or permitted to work in excess of 8 
hours or in excess of the standard workweek of 40 hours without payment

[[Page 547]]

of the overtime wages required by paragraph (b) of this section.
    (d) Withholding for liquidated damages and unpaid wages. The (write 
in the name of the State or political subdivision) may withhold or cause 
to be withheld, from any moneys payable on account of work performed by 
the contractor or subcontractor, such sums as may administratively be 
determined to be necessary to satisfy any liabilities of such contractor 
or subcontractor for unpaid wages and liquidated damages as provided in 
paragraph (c) of this section. In the event of failure to pay any 
laborer or mechanic, including apprentices and trainees, employed by the 
contractor or subcontractor in the performance of construction work 
hereunder, all or part of the wages required by the contract, the (write 
in the name of the State or political subdivision) may, after written 
notice to the contractor, take such action as may be necessary to cause 
the suspension of any further payment, advance or guarantee of funds 
until such violations have ceased.
    (e) Payrolls and basic records. (1) Payrolls and basic records 
relating thereto will be maintained during the course of the work and 
preserved for a period of 3 years thereafter for all laborers and 
mechanics working at the site of the work. Such records will contain the 
name and address of each such employee, his correct classification, 
rates of pay (including rates of contributions or costs anticipated of 
the types described in section 1(b)(2) of the Davis-Bacon Act), daily 
and weekly number of hours worked, deductions made and actual wages 
paid. Whenever the Secretary of Labor has found under 29 CFR 
5.5(a)(1)(iv) that the wages of any laborer or mechanic include the 
amount of any costs reasonably anticipated in providing benefits under a 
plan or program described in section 1(b)(2)(B) of the Davis-Bacon Act, 
the contractor shall maintain records which show that the commitment to 
provide such benefits is enforceable, that the plan or program is 
financially responsible, and that the plan or program has been 
communicated in writing to the laborers or mechanics affected, and 
records which show the costs anticipated or the actual cost incurred in 
providing such benefits.
    (2) The contractor will submit weekly a copy of all payrolls to the 
(write in the name of the State or political subdivision) accompanied by 
a statement signed by the employer or his agent indicating that the 
payrolls are correct and complete, that the wage rates contained therein 
are not less than those determined by the Secretary of Labor and that 
the classifications set forth for each laborer or mechanic conform with 
the work he performed. A submission of a ``weekly Statement of 
Compliance'' which is required under this contract and the Copeland 
Regulations (29 CFR part 3) of the Secretary of Labor and the filing 
with the initial payroll or any subsequent payroll of a copy of any 
findings by the Secretary of Labor under 29 CFR 5.5(a)(1)(iv) shall 
satisfy this requirement. The prime contractor shall be responsible for 
the submission of copies of payrolls of all subcontractors. The 
contractor will make the records required under the labor standards 
clauses of the contract available for inspection by authorized 
representatives of the (write in the name of the State and the political 
subdivision, if any); the Federal Emergency Management Agency; and the 
Department of Labor; and will permit such representatives to interview 
employees during working hours on the job. Contractors employing 
apprentices or trainees under approved programs shall include a notation 
on the first weekly certified payrolls submitted to the contracting 
State (or political subdivision, as applicable) that their employment is 
pursuant to an approved program and shall identify the program.
    (f) Apprentices and trainees-- (1) Apprentices. Apprentices will be 
permitted to work at less than the predetermined rate for the work they 
performed when they are employed and individually registered in a bona 
fide apprenticeship program registered with the U.S. Department of 
Labor, Manpower Administration, Bureau of Apprenticeship and Training, 
or with a State Apprenticeship Agency recognized by the Bureau, or if a 
person is employed in his first 90 days of probationary employment as an 
apprentice in such an apprenticeship

[[Page 548]]

program, who is not individually registered in the program, but who has 
been certified by the Bureau of Apprenticeship and Training or a State 
Apprenticeship Agency (where appropriate) to be eligible for 
probationary employment as an apprentice. The allowable ratio of 
apprentices to journeymen in any craft classification shall not be 
greater than the ratio permitted to the contractor as to his entire work 
force under the registered program. Any employee listed on a payroll at 
an apprentice wage rate, who is not a trainee as defined in paragraph 
(f)(2) of this section or is not registered or otherwise employed as 
stated above, shall be paid the wage rate determined by the Secretary of 
Labor for the classification of work he actually performed. The 
contractor or subcontractor will be required to furnish to the 
contracting officer or a representative of the Wage-Hour Division of the 
U.S. Department of Labor written evidence of the registration of his 
program and apprentices as well as the appropriate ratios and wage rates 
(expressed in percentages of the journeyman hourly rates), for the area 
of construction prior to using any apprentices on the contract work. The 
wage rate paid apprentices shall be not less than the appropriate 
percentage of the journeyman's rate contained in the applicable wage 
determination.
    (2) Trainees. Except as provided in 29 CFR 5.15, trainees will not 
be permitted to work at less than the predetermined rate for the work 
performed unless they are employed pursuant to and individually 
registered in a program which has received prior approval, evidenced by 
formal certification, by the U.S. Department of Labor, Manpower 
Administration, Bureau of Apprenticeship and Training. The ratio of 
trainees to journeymen shall not be greater than permitted under the 
plan approved by the Bureau of Apprenticeship and Training. Every 
trainee must be paid at not less than the rate specified in the approved 
program for his level of progress. Any employee listed on the payroll at 
a trainee rate who is not registered and participating in a training 
plan approved by the Bureau of Apprenticeship and Training shall be paid 
not less than the wage rate determined by the Secretary of Labor for the 
classification of work he actually performed. The contractor or 
subcontractor will be required to furnish the contracting officer or a 
representative of the Wage-Hour Division of the U.S. Department of Labor 
written evidence of the certification of his program, the registration 
of the trainees, and the ratios and wage rates prescribed in that 
program. In the event the Bureau of Apprenticeship and Training 
withdraws approval of a training program, the contractor will no longer 
be permitted to utilize trainees at less than the applicable 
predetermined rate for the work performed until an acceptable program is 
approved.
    (3) Equal employment opportunity. The utilization of apprentices, 
trainees and journeymen under this part shall be in conformity with the 
equal employment opportunity requirements of Executive Order 11246, as 
amended, and 29 CFR part 30.
    (g) Compliance with Copeland Regulations (29 CFR part 3). The 
contractor shall comply with the Copeland Regulations (29 CFR part 3) of 
the Secretary of Labor which are herein incorporated by reference.
    (h) Ineligible bidders. The contractor herein certifies as a 
condition of the contract that he is not listed on the Comptroller 
General's list of ineligible bidders published pursuant to regulations 
issued by the Secretary of Labor (29 CFR part 5) and the Davis-Bacon 
Act, as amended (40 U.S.C. 276a et seq.). This certification shall 
constitute a warranty, the falsity of which will render void this 
contract or subcontract, as the case may be.
    (i) Subcontracts. The contractor will insert in any subcontracts in 
paragraphs (a) through (h) and (j) of this section and such other 
clauses as the Federal Emergency Management Agency may by appropriate 
instructions require, and also a clause requiring the subcontractors to 
include these clauses in any lower tier subcontracts which they may 
enter into, together with a clause requiring this insertion in any 
further subcontracts that may in turn be made.
    (j) Contract termination; debarment. A breach of any of paragraphs 
(a) through

[[Page 549]]

(i) of this section may be grounds for termination of the contract, and 
for debarment as provided in 29 CFR 5.6.

[40 FR 42736, Sept. 16, 1975. Redesignated at 44 FR 56173, Sept. 28, 
1979]



Sec. 308.5  Examination of payrolls.

    (a) In cases where the contract involves construction work in excess 
of $2,000, a certified copy of all payrolls and statements required to 
be submitted under the contract provisions prescribed in Sec. 308.4, 
shall be checked by the State (or political subdivision, as applicable) 
against the applicable wage determination decision of the Secretary of 
Labor to verify labor standards compliance and to ascertain the 
following:
    (1) That the rates paid to various classifications of employees are 
in conformity with the applicable wage determination decision.
    (2) That each classification shown in the payrolls is a 
classification for which a rate was predetermined in the applicable wage 
determination decision.
    (3) That there are included in the payrolls those classifications of 
workers who would logically perform the work performed during the weeks 
in question.
    (4) That there is no disproportionate employment of laborers, 
helpers, apprentices or trainees.
    (b) Unless transferred to the Federal Emergency Management Agency, 
the payrolls and statements shall be preserved by the State (or 
political subdivision, as applicable) for a period of three years from 
the date of completion of the contract and shall be produced at the 
request of the Secretary of Labor at any time during the three-year 
period.

[40 FR 42738, Sept. 16, 1975. Redesignated at 44 FR 56173, Sept. 28, 
1979]



Sec. 308.6  Compliance.

    In cases where the contract involves construction work in excess of 
$2,000:
    (a) The State shall make (or cause the political subdivision to 
make) an ``on the site'' labor standards check, at least once during the 
project and at least every six months on projects of long duration, 
including without limitation the following:
    (1) Interviewing of a representative number of employees including 
but not necessarily limited to one employee in each classification or 
craft to ascertain what work the employee is doing and his regular rate 
of pay. This information shall be checked against the payrolls and the 
applicable wage determination decision to verify compliance or 
noncompliance.
    (2) Examining evidence of registration and certification with 
respect to apprenticeship and training plans to determine the 
correctness of classifications and any disproportionate employment of 
laborers, helpers, apprentices or trainees.
    (b) In conducting investigations, including those of complaints of 
alleged violations (which shall be given priority) all statements, 
written or oral, made by an employee are to be treated as confidential 
and shall not be disclosed to his employer without the consent of the 
employee. All indications, including but not limited to all complaints, 
of alleged violations of labor standards brought to its attention shall 
be investigated by the State (or political subdivision at the State's 
direction) and the State shall require that all such indications brought 
to the attention of a political subdivision shall be forthwith brought 
to the attention of the State.
    (c) If there is evidence of labor standards noncompliance, 
restitution shall be required of the contractor or subcontractor and the 
State (or political subdivision, as applicable) shall, after written 
notice to the contractor, withhold from the contractor such advances, 
guarantees and accrued payments as are administratively determined 
necessary to cover any liquidated damages and the restitution due 
laborers and mechanics employed by the contractor or subcontractor. The 
State (or political subdivision, as applicable) also has the option of 
terminating the contract in accordance with its provisions. If there is 
evidence that these violations were aggravated, willful, or resulted in 
underpayments of $500 or more, a detailed report, including information 
as to restitution

[[Page 550]]

made, payments, advances and guarantees of funds withheld, contract 
terminations, and the name and address of each laborer and mechanic and 
contractor or subcontractor affected, and the day or days of such 
violations, shall be submitted by the State to the Federal Emergency 
Management Agency. Except where the Federal Emergency Management Agency 
has expressly requested that the investigation be made, no report need 
be made where the underpayments total less than $500, if nonwillful, 
restitution has been made and the State has received assurance of future 
compliance.

[29 FR 12366, Aug. 28, 1964, as amended at 40 FR 42738, Sept. 16, 1975. 
Redesignated at 44 FR 56173, Sept. 28, 1979]



Sec. 308.7  Certification of compliance.

    (a) After the beginning of construction (under a contract involving 
construction in excess of $2,000), no payment or advance to the 
contracting State (or where applicable, to the contracting political 
subdivision) shall be approved by the Federal Emergency Management 
Agency unless and until it has received a certification by the 
contractor that his contract and those of his subcontractors contain the 
provisions prescribed in Sec. 308.4 and that he and his contractors have 
complied therewith, or that there is a substantial dispute with respect 
to the required provisions.
    (b) Before making final payment on any contract involving 
construction work in excess of $2,000, the State (or political 
subdivision, as applicable) shall submit to the Federal Emergency 
Management Agency the following certification, verbatim, in completed 
form:

                Certificate of Labor Standards Compliance

    Knowing that my statements will be relied upon by the Federal 
Emergency Management Agency, in its payment to the State under an 
approved project application for a Federal financial contribution under 
section 201(i) of the Federal Civil Defense Act of 1950, as amended (50 
U.S.C. App. 2281) I do hereby certify as follows:
    1. That I am the Contracting Officer of 
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm (write in the 
name of the political subdivision and/or State, as applicable), 
applicant under Federal Emergency Management Agency, Project Application 
No. &lowbarm&lowbarm--.
    2. That in my official capacity I have personally, or through 
authorized employee(s) of the above named applicant for purposes of this 
certification, completed the following: (i) Examinations of all 
contracts involving construction work in excess of $2,000 on the civil 
defense project covered by the aforementioned project application, and 
all subcontracts thereunder; (ii) examinations of all payrolls and 
statements required to be submitted under such contracts and comparison 
with the applicable wage determination decision of the Secretary of 
Labor as required by Sec. 308.5 of subchapter E, chapter I, of title 44 
of the Code of Federal Regulations; and (iii) investigations of all 
indications of alleged labor standards violations including, without 
limitation, at least one ``on the site'' labor standards check, and 
other investigations as required by Sec. 308.6 of subchapter E, chapter 
I, of title 44 of the Code of Federal Regulations.
    3. That, based upon the aforementioned examinations and 
investigations, I have determined that: (i) The labor standards 
provisions have been included and the applicable wage determination 
decision has been attached, all as a part of the conditions of each 
contract involving construction work in excess of $2,000 and all 
subcontracts thereunder as required by Sec. 308.4 of subchapter E, 
chapter I, of title 44 of the Code of Federal Regulations; and (ii) the 
contractor and all subcontractors were in compliance, or have come into 
compliance, with the labor standards provisions, wage determination 
decision and Copeland Regulations (29 CFR part 3) except 
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm (List names of 
all contractors not in compliance or if no exceptions, state ``none'') 
and $&lowbarm&lowbarm&lowbarm restitution is due to the employees of 
the listed contractor and/or subcontractors (set forth the amount or 
``none,'' in accordance with the facts).
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
                                lowbarm;&lowbarm&lowbarm&lowbarm (LS)
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
                   lowbarm;&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm
                                                    (Name of Contracting
                                                          Officer)      
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
                   lowbarm;&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm
                                             (Name of State or political
                                                      subdivision)      
&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm&
                   lowbarm;&lowbarm&lowbarm&lowbarm&lowbarm&lowbarm
                                                           (Dated)      

[40 FR 42738, Sept. 16, 1975. Redesignated at 44 FR 56173, Sept. 28, 
1979]



PARTS 309-311 [RESERVED]






PART 312--USE OF CIVIL DEFENSE PERSONNEL, MATERIALS, AND FACILITIES FOR NATURAL DISASTER PURPOSES--Table of Contents




Sec.

[[Page 551]]

312.1  Purpose.
312.2  Definitions.
312.3  Policy.
312.4  General.
312.5  Personnel.
312.6  Materials and facilities.

    Authority: Sec. 803(a)(3) Pub. L. 97-86; sec. 401, Federal Civil 
Defense Act of 1950, as amended, 50 U.S.C. app. 2253; Reorganization 
Plan No. 3 of 1978; 3 CFR, 1978 Comp., p. 329; and E.O. 12148 of July 
20, 1979, 44 FR 43239.

    Source: 47 FR 43381, Oct. 1, 1982, unless otherwise noted.



Sec. 312.1  Purpose.

    The purpose of the regulations in this part is to prescribe the 
terms and conditions under which civil defense personnel, materials, and 
facilities, supported in whole or in part through contributions under 
the Federal Civil Defense Act of 1950, as amended, 50 U.S.C. App. 2251, 
et seq., hereinafter referred to as ``the Act'', may be used for natural 
disasters, to the extent that such usage is consistent with, contributes 
to, and does not detract from attack-related civil defense preparedness.



Sec. 312.2  Definitions.

    Except as otherwise stated, when used in the regulations in this 
part, the meaning of the listed terms are as follows:
    (a) The term attack means any attack or series of attacks by an 
enemy of the United States causing, or which may cause, substantial 
damage or injury to civilian property or persons in the United States in 
any manner by sabotage or by use of bombs, shellfire, or atomic-
radiological, chemical, bacteriological, or biological means or other 
weapons or processes;
    (b) The term natural disaster means any hurricane, tornado, storm, 
flood, high water, wind-driven water, tidal wave, tsunami, earthquake, 
volcanic eruption, landslide, mudslide, snowstorm, drought, fire, or 
other catastrophe in any part of the United States which causes, or 
which may cause, substantial damage or injury to civilian property or 
persons and, for the purposes of the Act, any explosion, civil 
disturbance, or any other manmade catastrophe shall be deemed to be a 
natural disaster;
    (c) The term civil defense means all those activities and measures 
designed or undertaken (1) to minimize the effects upon the civilian 
population caused, or which would be caused, by an attack upon the 
United States, or by natural disaster, (2) to deal with the immediate 
emergency conditions which would be created by any such attack, or 
natural disaster, and (3) to effectuate emergency repairs to, or the 
emergency restoration of vital utilities and facilities destroyed or 
damaged by any such attack or natural disaster. Such term shall include, 
but shall not be limited to, (i) measures to be taken in preparation for 
anticipated attack or natural disaster (including the establishment of 
appropriate organizations, operational plans, and supporting agreements; 
the recruitment and training of personnel; the conduct of research; the 
procurement and stockpiling of necessary materials and supplies; the 
provision of suitable warning systems; the construction or preparation 
of shelter areas, and control centers; and, when appropriate, the non-
military evacuation of civil population); (ii) measures to be taken 
during attack or natural disaster (including the enforcement of passive 
defense regulations prescribed by duly established military or civil 
authorities; the evacuation of personnel to shelter areas; the control 
of traffic and panic; and the control and use of lighting and civil 
communications); and (iii) measures to be taken following attack or 
natural disaster (including activities for firefighting; rescue, 
emergency medical, health and sanitation services; monitoring for 
specific hazards of special weapons; unexploded bomb reconnaissance; 
essential debris clearance; emergency welfare measures; and immediately 
essential emergency repair or restoration of damaged vital facilities);
    (d) The word materials shall include raw materials, supplies, 
medicines, equipment, component parts and technical information and 
processes necessary for civil defense;
    (e) The word facilities, except as otherwise provided herein, shall 
include buildings, shelters, utilities, and land;
    (f) The term United States or States shall include the several 
States, the District of Columbia, the Territories,

[[Page 552]]

and the possessions of the United States;
    (g) The term political subdivisions shall include local governments, 
including but not limited to cities, towns, incorporated communities, 
counties, parishes, and townships; and
    (h) The term CPG 1-3 refers to FEMA's ``Federal Assistance 
Handbook'' promulgated as Civil Preparedness Guide (CPG) 1-3, as 
amended, by numbered changes thereto and by Civil Preparedness Circulars 
(CPC). CPG 1-3 sets forth detailed guidance on procedures which a State 
and, where applicable, its political subdivisions must follow in order 
to request financial assistance from FEMA. It also sets forth detailed 
requirements, terms, and conditions upon which financial assistance is 
granted.

(Reorganization Plan No. 3 of 1978, E.O. 12127 and E.O. 12148)

[47 FR 43381, Oct. 1, 1982, as amended at 48 FR 44545, Sept. 29, 1983]



Sec. 312.3  Policy.

    (a) It is the policy of FEMA to provide a means of assistance to 
States and their political subdivisions in their carrying out 
responsibilities to alleviate the suffering and damage from attack-
related or natural disasters by:
    (1) Providing contributions for personnel, equipment, materials and 
facilities that may be used in preparing for or responding to disasters, 
provided that the use of such funds for natural disasters is consistent 
with, contributes to, and does not detract from attack-related civil 
defense preparedness.
    (2) Encouraging the development of comprehensive disaster 
preparedness and assistance plans, programs, capabilities, and 
organizations by the State and its political subdivisions.
    (3) Assisting in achieving greater coordination of disaster 
preparation and response programs.
    (4) Providing technical advice and guidance to States and their 
political subdivisions for organizing and preparing to meet the effects 
of disasters.
    (b) These regulations are not to be interpreted as authorizing 
States and their political subdivisions to request or receive additional 
assistance relating to particular disaster incidents.



Sec. 312.4  General.

    (a) The Director, FEMA, will provide statements to States and their 
political subdivisions concerning Agency mission and goals, Annual 
Program Emphasis, and other directions, instructions, and technical 
guidance which together specify preparedness and response activities for 
both attack-related and natural disasters.
    (b) States and their political subdivisions may apply to FEMA for 
financial assistance under the Act in a manner prescribed by Federal 
Regulations governing grants and cooperative agreements. Such 
applications must be compatible with FEMA's goals and requirements 
described in paragraph (a) of this section.
    (c) Financial contributions to States and their political 
subdivisions are made by FEMA based on approval of the activities and 
projects described in the Annual Program Paper, and/or Comprehensive 
Cooperative Agreement, and which are in conformance with provisions of 
CPG 1-3, and applicable FEMA regulations set forth in chapter 1 of this 
title 44, chapter 1, subchapter E, of the Code of Federal Regulations. 
Financial contributions will not be made unless substantive activities 
and projects in preparation for and response to attack-related disasters 
are identified, and progress is indicated in the submissions, and 
recorded in program reporting systems. The presence of unavoidable 
circumstances, and the good faith effort of the applicant, will be 
considered if certain objectives are not met.
    (d) State and local officials may use personnel, equipment, and 
facilities for natural disasters outside the physical boundaries of the 
jurisdiction and under the conditions stated within this regulation.
    (e) Specific criteria relating to the preparedness and response 
activities are given in Secs. 312.5 and 312.6 of this part.



Sec. 312.5  Personnel.

    FEMA contributes to the development and support of emergency 
management organizations in the States and their political subdivisions, 
and to the development, operation, and maintenance of specific programs, 
through

[[Page 553]]

payment of salaries and benefits of State and local civil defense staff, 
and the payment of administrative expenses and travel, not to exceed 50 
percent. FEMA also provides contributions for training and education 
expenses. The following use of such personnel for natural disaster 
purposes is allowable provided that such usage is consistent with, 
contributes to, and does not detract from attack-related civil defense 
preparedness:
    (a) In developing, maintaining, testing and exercising plans, 
systems, and procedures for the protection of people and property from 
the effects of attack-related disasters, States and their political 
subdivisions may include and provide for natural disasters.
    (b) Personnel supported in part through contributions under the Act 
may be assigned responsibilities for preparation for and response to 
natural disasters in any specific emergency occurring in a State or its 
political subdivisions as determined by the responsible State or local 
officials, respectively.
    (c) Personnel supported in whole under the Act, may be assigned to 
emergency response operations for 15 days at the discretion of State 
officials; approval of the FEMA Regional Director is required for the 
use of these personnel in excess of 15 days. An assignment to emergency 
response operations does not preclude the accomplishment of program work 
and objectives. Failure to accomplish such work may subject the State to 
the withholding of funds contributed under the Act, or to collection of 
funds already obligated, not to exceed the estimated cost of the work 
not performed, as determined by the Regional Director.
    (d) In the event of an emergency or major disaster declared under 
the Disaster Relief Act of 1974, as amended, personnel will not be 
provided overtime compensation and expenses under the Act.



Sec. 312.6  Materials and facilities.

    FEMA also contributes to the development and support of emergency 
management in the States and their political subdivisions, and to the 
development, operation, and maintenance of specific programs, through 
providing certain materials and facilities. The following may be used 
for natural disaster purposes provided that such usage is consistent 
with, contributes to, and does not detract from attack-related civil 
defense preparedness:
    (a) Materials provided and maintained through contributions under 
the Act.
    (b) Technical information, guidance through which technical 
assistance is provided, and training courses, may contain examples, 
illustrations, discussion, suggested applications and uses of material.
    (c) Equipment loaned under provisions of the Contributions Project 
Loan Program.
    (d) Facilities, such as Emergency Operating Centers, provided and 
maintained through contributions under the Act.
    (e) Equipment loaned or granted to the States for civil defense 
purposes (e.g., radiological instruments, shelter supplies).



PARTS 313-319 [RESERVED]






PART 320--DISPERSION AND PROTECTIVE CONSTRUCTION: POLICY, CRITERIA, RESPONSIBILITIES (DMO-1)--Table of Contents




Sec.
320.1  Policy.
320.2  Criteria.
320.3  Responsibilities.

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 
12148, 44 FR 43239.

    Source: 45 FR 44575, July 1, 1980, unless otherwise noted.



Sec. 320.1  Policy.

    It is the policy of the United States to encourage and, when 
appropriate, to require that new facilities and major expansions of 
existing facilities important to national security be located in so far 
as practicable, so as to reduce the risk of damage in the event of 
attack; and to encourage and, when appropriate, require the 
incorporation of protective construction features in new

[[Page 554]]

and existing facilities to provide resistance to weapons effects 
suitable to the locations of said facilities.



Sec. 320.2  Criteria.

    (a) The distance of a facility from the probable area of destruction 
is the controlling factor in reducing the risk of attack damage to such 
facility. In determining the appropriate distance consideration will be 
given to all relevant factors, including:
    (1) The most likely objects or targets of enemy attack, such as 
certain military, industrial, population, and governmental 
concentrations.
    (2) The size of such targets.
    (3) The destructive power of a large yield weapon or weapons 
suitable to the particular target.
    (4) The gradation of pressures and thermal radiation at various 
distances from an assumed point of detonation.
    (5) The characteristics of the proposed facility, including 
underground and built-in protective construction features, with respect 
to its resistance to nuclear, chemical, and unconventional weapons.
    (6) The degree of damage which a facility could sustain and still 
remain operable.
    (7) The ground environment or natural barriers which might provide 
added protection to the facility.
    (8) The economic, operational, and administrative requirements in 
carrying out the function for which the facility is to be provided.
    (b) While no single distance standard and no single set of 
protective construction specifications against nuclear, chemical and 
unconventional weapons are feasible for all situations, the above 
factors will be applied so as to achieve the most protection practicable 
for a specific situation.



Sec. 320.3  Responsibilities.

    (a) All departments and agencies of the Executive Branch of the 
Federal Government are responsible for adherence to the policy and 
criteria herein set forth with respect to programs under their control. 
Without limitation, specific reference is made to the following:
    (1) All agencies:
    (i) Programs for minimizing the vulnerability of the mobilization 
base (DMO I-4, paragraph 17);
    (ii) Consideration of dispersed location and protective construction 
in the review of application for tax amortization (DMO III-1, paragraphs 
4 and 5);
    (iii) Application of Dispersion Standards to Facilities of the 
Executive Branch, in accordance with policy and standards issued by the 
Director, Federal Emergency Management Agency.
    (2) Department of Defense--Programs for maximum use of dispersed 
plants, and development of standards for strategic locations and 
physical security. (DMO I-12, paragraph 2, g, h, and o.)
    (3) Department of the Interior--Programs for continuity of 
production of certain assigned industries.
    (4) Department of Agriculture--Programs for operation of vital food 
facilities.
    (5) Department of Commerce--Programs for dispersion and continuity 
of production.
    (6) Federal Emergency Management Agency--Development and 
coordination of plans and programs for the reduction of urban 
vulnerability.
    (b) The Department of Commerce is responsible for providing guidance 
and assistance to departments and agencies of the Federal Government, to 
industry, public and private persons and organizations including local 
Dispersion Committees, in the application of the policy and criteria 
contained herein.
    (1) By agreement between the Department of Defense and the 
Department of Commerce, Department of Defense will provide guidance on 
certain industrial and other non-military projects in which it has a 
direct and special interest.
    (2) The Department of Commerce may make similar arrangements with 
other departments and agencies to provide guidance on projects in which 
they have a direct and special interest, provided that reasonable 
safeguards to assure consistency and uniformity in the application of 
the policy and standards are maintained.
    (3) The Department of Defense is responsible for the application of 
this policy to military projects without consultation with the 
Department of Commerce, but with due regard to the

[[Page 555]]

location of other vital facilities and plans for reduction of urban 
vulnerability as developed by the Federal Emergency Management Agency.
    (c) The Federal Emergency Management Agency, responsible for the 
development and coordination of plans and programs for the reduction of 
urban vulnerability, is responsible for integrating at the metropolitan 
target zone level dispersion actions with all other measures which can 
make urban areas less attractive targets. It is also responsible for 
promulgating construction standards and specifications for the 
protection of persons and property from nuclear and unconventional 
weapons effects. The Department of Commerce and all others concerned 
will be governed by such standards in rendering the guidance and 
assistance described in paragraph (b) of this section.



PART 321--MAINTENANCE OF THE MOBILIZATION BASE (DEPARTMENT OF DEFENSE, DEPARTMENT OF ENERGY, MARITIME ADMINISTRATION)--Table of Contents




Sec.
321.1  General.
321.2  Selection of the mobilization base.
321.3  Maintaining the mobilization base.
321.4  Achieving production readiness.
321.5  Retention of industrial facilities.
321.6  Participation of small business.
321.7  [Reserved]
321.8  Reports.

    Authority: National Security Act of 1947, as amended 50 U.S.C. 404; 
Defense Production Act of 1950, as amended; 50 U.S.C. app. 2061 et seq.; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 12148 
(44 FR 43239).

    Source: 45 FR 44576, July 1, 1980, unless otherwise noted.



Sec. 321.1  General.

    A sustained state of mobilization production readiness is necessary 
to place the United States in a defense posture which will enable the 
nation to defend itself against aggression in peripheral conflicts or 
general war involving nuclear attacks on this country. Therefore, the 
facilities, machine tools, production equipment, and skilled workers 
necessary to produce the wartime requirements of the Department of 
Defense, Department of Energy, and the Maritime Administration shall be 
maintained in a state of readiness which will facilitate their immediate 
use or conversion in time of emergency, with especial emphasis on 
measures to maximize the probability of continued post-attack production 
of those items judged to be vital to survival and victory.



Sec. 321.2  Selection of the mobilization base.

    (a) The Department of Defense shall select, for its mobilization 
base, facilities which produce or are capable of producing critically 
important military items or components (military class A components used 
entirely in the production, maintenance, or repair of military items) 
which meet one of the following:
    (1) Those items which would be so urgent to the defense of this 
country that utmost effort must be exerted to produce them even in case 
of general war involving severe damage to the facilities necessary to 
produce these items and the components thereof.
    (2) Those items essential to survival and retaliation, maintenance 
of health, or combat efficiency required to support peripheral war and 
which meet one or more of the following criteria:
    (i) Items requiring a long lead-time or long manufacturing cycle.
    (ii) Items currently not in production or which are required in 
quantities far in excess of peacetime production.
    (iii) Items requiring the conversion of an industry or a number of 
plants within an industry.
    (iv) Items requiring materials or manufacturing processes 
essentially different from those in current use.
    (v) Items for which industry does not have production experience.

Paragraph (a)(2) of this section is inclusive of the Department of 
Defense Preferential Planning List of End Items.
    (b) In selecting facilities for the Department of Defense 
mobilization base, consideration shall be given to their vulnerability 
to nuclear attack, with particular attention to the possibility of (1) 
minimizing vulnerability of facilities producing ``urgent'' items under 
paragraph (a)(1) of this section,

[[Page 556]]

including the need for dispersal, protective construction, and special 
security measures to safeguard against sabotage of clandestine attack, 
and (2) reducing concentration of uncommon critical production 
facilities so that a productive segment of each critical industry would 
be likely to survive a nuclear attack.
    (c) The Department of Energy and the Maritime Administration, in 
cooperation with the Federal Emergency Management Agency, shall 
determine the items and facilities which meet the above criteria for 
their respective programs for maintaining the mobilization base.



Sec. 321.3  Maintaining the mobilization base.

    (a) Facilities selected to produce ``urgent'' items shall be 
maintained within limits of existing procurement authority and funds 
available by the Department of Defense, the Department of Energy, and 
the Maritime Administration in the following manners to the maximum 
practical degree:
    (1) Current procurement shall be placed in these facilities to the 
extent which will maintain them in a state of readiness compatible with 
the plans of the procuring agency.
    (2) Machine tools and production equipment will be installed in 
these facilities to the extent found necessary by the procuring agency.
    (3) Develop and maintain plans for alternate production capacity in 
case disaster destroys current facilities, such capacity to be located 
to the maximum extent possible away from highly concentrated industrial 
areas and major military installations.
    (b) Other facilities selected as part of the mobilization base, 
shall be maintained to the fullest extent possible.
    (1) Procurement agencies shall integrate current procurement with 
their industrial mobilization plans to the greatest possible extent with 
the objective of supporting the mobilization base within authorities and 
funds available.
    (2) Data assembled on essential mobilization suppliers by the 
industrial mobilization planning of these agencies shall be used in 
planning current procurement. The policy of using contractors and 
facilities essential to the mobilization base is considered to be in the 
best interest of the Government.
    (3) Planned producers that are deemed to be a part of the 
mobilization base will be invited to participate in appropriate current 
procurement.
    (4) Upon expiration of current procurement contracts in a facility, 
the procuring agency shall take such of the following actions as are 
compatible with its plans for maintaining a state of readiness:
    (i) Government-owned facilities and tools. Within the limitations 
that may be imposed by Congressional appropriations, place government-
owned facilities and tools in standby status and establish provisions 
for their adequate maintenance. This does not preclude the use of 
government-owned production equipment, on a loan basis, to enable the 
military departments to meet current production schedules, as provided 
in DMO-VII-4, Amendment 1.
    (ii) Privately-owned facilities and government-owned tools. (A) 
Arrange with management of privately-owned facilities, wherever 
possible, to place government-owned tools and production equipment in 
the status provided by DMO-VII-4, as amended, taking into account the 
desirability of safe location.
    (B) Arrange with management, on a voluntary basis, to keep a group 
of key managers, engineers, and skilled workers familiar with the items 
planned for mobilization production.
    (C) Determine the gaps which exist in government-owned packages of 
tools and production equipment needed to produce mobilization 
requirements in privately-owned plants. Within the limit of fund 
availability, plan the procurement of such tools and equipment with 
priority being given to long lead-time tools and equipment or those not 
used in general manufacturing. These tools and equipment, when procured, 
should be placed in the status provided by DMO-VII-4, as amended, taking 
into account the desirability of safe locations.
    (D) Determine which government-owned tools and equipment have become 
obsolete, or which would not be used in event of mobilization, and plan 
for their disposal in accordance with

[[Page 557]]

the provisions of DMO-VII-4, as amended.



Sec. 321.4  Achieving production readiness.

    (a) In order to achieve a capability for maximum production of 
``urgent'' items during the initial phase of war, the following 
readiness measures shall be taken where advisable for facilities 
producing such items:
    (1) Establishment of emergency production schedules.
    (2) Development of a production capability which would function 
under widespread disruption and damage imposed by enemy attack, 
including, where necessary:
    (i) Maintenance of an increased inventory of finished components and 
related production supplies at assembly plants, or arrangements for 
alternative supply lines where increased inventories are not feasible.
    (ii) A capability to carry on urgent production without dependence 
on additional personnel, external sources of power, fuel, and water, or 
on long-distance communications; with spare replacements for highly 
vulnerable or unreliable parts of production equipment.
    (iii) Protection of production facilities from enemy sabotage 
through adequate physical security measures.
    (iv) Protection of personnel from widespread radiological fallout 
through provisions for decontamination and shelter.



Sec. 321.5  Retention of industrial facilities.

    (a) Industrial properties, owned by the Department of Defense, the 
Department of Energy, and the Maritime Administration, shall be retained 
in the Industrial reserves (National Industrial Reserve, Departmental 
Industrial Reserve for the Department of Defense) of the department and 
agencies to the extent the capacity of said reserves is necessary for 
the production of defense or defense-supporting end items, materials or 
components in a mobilization period.
    (b) Each idle plant in the reserves shall be reviewed annually by 
the heads of the respective agencies to determine if the capacity of the 
plant continues necessary for mobilization purposes.
    (c) Upon the determination by the head of the agency that the 
capacity of a plant is excess to the mobilization requirements of the 
agency immediate steps will be taken to dispose of the plant through 
existing government channels for surplus disposal. The Federal Emergency 
Management Agency shall be informed by General Services Administration 
of each proposed surplus action prior to final determination.



Sec. 321.6  Participation of small business.

    The agencies concerned with the order shall, in all of their 
programs for maintaining the mobilization base, be mindful of the 
national policy to protect the interests of small business, and to 
assure the maximum participation of small business in the mobilization 
base, including current procurement.



Sec. 321.7  [Reserved]



Sec. 321.8  Reports.

    The Department of Defense, Department of Energy, and Maritime 
Administration shall furnish the Director of the Federal Emergency 
Management Agency with reports on items and facilities for programs 
under Sec. 321.2 (a) and (b) of this part, and with such other periodic 
and special reports as he may require affecting the maintenance of the 
mobilization base.



PART 323--GUIDANCE ON PRIORITY USE OF RESOURCES IN IMMEDIATE POST ATTACK PERIOD (DMO-4)--Table of Contents




Sec.
323.1  Purpose.
323.2  General policy.
323.3  Responsibilities.
323.4  Priority activities in immediate post-attack period.
323.5  Assignment of resources.

Appendix 1 to Part 323--List of Essential Survival Items

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq.; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 12148 
of July 20, 1979, 44 FR 43239.

[[Page 558]]


    Source: 45 FR 44579, July 1, 1980, unless otherwise noted.



Sec. 323.1  Purpose.

    This part:
    (a) States the policy of the Federal Government on use of resources 
in the period immediately following a nuclear attack on the United 
States;
    (b) Provides general guidance for Federal, State, and local 
government officials on activities to be accorded priority in the use of 
postattack resources; and
    (c) Lists those items essential to national survival in the 
immediate postattack period.



Sec. 323.2  General policy.

    (a) In an immediate postattack period all decisions regarding the 
use of resources will be directed to the objective of national survival 
and recovery. In order to achieve this objective, postattack resources 
will be assigned to activities concerned with the maintenance and saving 
of lives, immediate military defense and retaliatory operations, 
economic activities essential to continued survival and recovery.
    (b) This guidance is designed to achieve a degree of national equity 
in the use of resources and to assign and conserve resources effectively 
in the immediate postattack period. Until more specific instructions are 
available, these are the general guidelines within which managerial 
judgment and common sense must be used to achieve national objectives 
under widely differing emergency conditions.



Sec. 323.3  Responsibilities.

    (a) As stated in The National Plan for Emergency Preparedness, the 
direction of resources mobilization is a Federal responsibility. 
However, in the period immediately following an attack, certain 
geographical areas may be temporarily isolated, and State and local 
governments will assume responsibility for the use of resources 
remaining in such areas until effective Federal authority can be 
restored. State and local governments will not assume responsibility for 
resources under the jurisdiction of a Federal agency where the Federal 
agency is able to function.
    (b) As soon as possible after an attack and until specific national 
direction and guidance on the use of resources is provided, Federal, 
State, and local officials will determine what resources are available, 
to what needs they can be applied, how they are to be used, and the 
extent to which resources are deficient or in excess of survival needs. 
They will base determinations as to the relative urgency for use of 
resources primarily upon the importance of specific needs of defense, 
survival, and recovery.



Sec. 323.4  Priority activities in immediate postattack period.

    The following activities are to be accorded priority over all other 
claims for resources. There is no significance in the order of the 
listing--all are important. The order in which and the extent to which 
they are supported locally may vary with local conditions and 
circumstances. If local conditions necessitate the establishment of an 
order of priority among these activities, that order shall be based on 
determinations of relative urgency among the activities listed, the 
availability of resources for achieving the actions required, and the 
feasibility and timeliness of the activities in making the most rapid 
and effective contribution to national survival.
    (a) The immediate defense and retaliatory combat operations of the 
Armed Forces of the United States and its Allies: This includes support 
of military personnel and the production and distribution of military 
and atomic weapons, materials and equipment required to carry out these 
immediate defense and retaliatory combat operations.
    (b) Maintenance or reestablishment of Government authority and 
control to restore and preserve order and to assure direction of 
emergency operations essential for the safety and protection of the 
people. This includes:
    (1) Police protection and movement direction;
    (2) Fire defense, rescue and debris clearance;
    (3) Warnings;
    (4) Emergency information and instructions;
    (5) Radiological detection, monitoring and decontamination.

[[Page 559]]

    (c) Production and distribution of survival items and provision of 
services essential to continued survival and rapid recovery. (For list 
of survival items, see appendix 1 to this part.) These include:
    (1) Expedient shelter;
    (2) Food, including necessary processing and storage;
    (3) Feeding, clothing, lodging, and other welfare services;
    (4) Emergency housing and community services;
    (5) Emergency health services, including medical care, public health 
and sanitation;
    (6) Water, fuel, and power supply;
    (7) Emergency repair and restoration of damaged vital facilities.
    (d) Essential communications and transportation services needed to 
carry out the above activities.
    (e) Provision of supplies, equipment, and repair parts to produce 
and distribute goods needed for the above activities.



Sec. 323.5  Assignment of resources.

    Resources required for essential uses, including manpower, will be 
assigned to meet the emergency requirements of the priority activities 
indicated above. The principal objectives are to use available resources 
to serve essential needs promptly and effectively, and to:
    (a) Protect and to prevent waste or dissipation of resources prior 
to their assignment to priority activities;
    (b) Support production of essential goods. Other production will be 
permitted to continue only from inventories on hand and when there is no 
emergency requirement for the resources vital to this production.
    (c) Support construction for emergency repair and restoration, 
construction of facilities needed for survival, or the conversion of 
facilities to survival use, where this can be accomplished quickly. 
Other construction already under way should be stopped, and no new 
construction started unless it can be used immediately for essential 
purposes upon completion.

        Appendix 1 to Part 323--List of Essential Survival Items

    This document contains a list of items considered essential to 
sustain life at a productive level to assure national survival in an 
emergency. The list identifies items to which major attention should be 
given in all phases of preattack planning to insure the availability of 
basic essentials for a productive economy in the event of a nuclear 
attack. Supply-requirements studies and assessments for these items will 
be made to disclose critical deficiencies or other problems that can be 
anticipated. Revisions will be made as necessary to keep the items as 
up-to-date as possible.
    The items are arranged by seven major groups:
    (1) Health Supplies and Equipment,
    (2) Food,
    (3) Body Protection and Household Operations,
    (4) Electric Power and Fuels,
    (5) Sanitation and Water Supply,
    (6) Emergency Housing and Construction Materials and Equipment, and
    (7) General Use Items.
    Survival items are defined as ``those items without which large 
segments of the population would die or have their health so seriously 
impaired as to render them both burdensome and non-productive.'' The 
items have been classified into Group A or Group B, with Group A 
representing end products consumed or used directly by the population, 
and Group B consisting of those items essential to the effective 
production and utilization of the Group A items, which are consumed or 
used directly by the people.
    There are no Group B items in the categories of Health Supplies and 
Equipment, Body Production and Household Operations, and Emergency 
Housing and Construction Materials and Equipment. All of these items are 
considered to be consumed directly and any attempt to separate them in 
to A and B groupings would be too arbitrary to be meaningful.
    It is important to keep in mind the fact that while the items listed 
are the basic essentials necessary for maintaining a viable economy 
during the first six months following an attack, not all of them would 
create problems that would require government action preattack to insure 
adequate supplies. The aforementioned supply-requirements studies will 
be undertaken to identify the problem areas. In developing supply data, 
all available production capacity, existing inventories, and possible 
substitutions will be considered. For example, in analyzing clothing 
items, all available supplies would be considered from sport to dress 
shirts, from overalls to dress suits. However, new production would be 
limited to the simplest form of the basic item which can be produced. 
The final determination as to which of the items are most critical and 
which may require preattack actions by the Government, as well as the 
type of actions which must be

[[Page 560]]

taken, can be made only after a comprehensive supply-requirements 
analysis is completed.

                    List of Essential Survival Items

                    i. health supplies and equipment

                                 Group A

    1. Pharmaceuticals:
Alcohol.
Analgesics, non-narcotic.
Antibiotics and antibacterials.
Antidiabetic agents, oral.
Antihistamines.
Antimalarials.
Atropine.
Blood derivatives.
Carbon dioxide absorbent.
Cardiovascular depressants.
Cardiovascular stimulants.
Corticosteriods.
Diuretics.
General anesthetics.
Hypnotics.
Insulin.
Intravenous solutions for replacement therapy.
Local anesthetics.
Lubricant, surgical.
Morphine and substitutes.
Oral electrolytes.
Oxygen.
Surgical antiseptics.
Sulfa drugs.
Synthetic plasma volume expanders.
Vitamin preparations, pediatric.
Water for injection.

    2. Blood Collecting and Dispensing Supplies:
Blood collecting and dispensing containers.
Blood donor sets.
Blood grouping and typing sera.
Blood recipient sets.
Blood shipping containers.

    3. Biologicals:
Diphtheria toxoid.
Diphtheria antitoxin.
Diphtheria and tetanus toxoids and pertussis vaccine.
Gas gangrene antitoxin.
Poliomyelitis vaccine, oral.
Rabies vaccine.
Smallpox vaccine.
Tetanus antitoxin.
Tetanus toxoid, absorbed.
Typhoid vaccine.
Typhus vaccine, epidemic.
Yellow fever vaccine.

    4. Surgical Textiles:
Adhesive plaster.
Bandage, gauze.
Bandage, muslin.
Bandage, plaster of paris.
Cotton, USP.
Surgical pads.
Stockinette, surgical.
Wadding, cotton sheet.

    5. Emergency Surgical Instruments and Supplies:
Airway, pharyngeal.
Anesthesia apparatus.
Basin, wash, solution.
Blade, surgical knife.
Brush, scrub, surgical.
Catheter, urethral.
Containers for sterilization.
Chisel, bone.
Drain, Penrose.
Dusting powder.
Forceps, dressing.
Forceps, hemostatic.
Forceps, obstetrical.
Forceps, tissue.
Gloves, surgeon's.
Handles, surgical knife.
Holder, suture needle.
Inhaler, anesthesia, Yankauer (ether mask).
Intravenous injection sets.
Knife, cast cutting.
Lamps, for diagnostic instruments.
Lamps, for surgical lights.
Laryngoscope.
Light, surgical, portable.
Litter.
Mallet, bone surgery.
Needles, hypodermic, reusable.
Needles, suture, eyed.
Otoscope and ophthalmoscope set.
Probe, general operating.
Razor and blades (for surgical preparation).
Retractor, rib.
Retractor set, general operating.
Rongeur, bone.
Saw, amputating.
Saw, bone cutting, wire (Gigli).
Scissors, bandage.
Scissors, general surgical.
Sigmoidoscope.
Speculum, vaginal.
Sphygmomanometer.
Splint, leg, Thomas.
Splint, wire, ladder.
Sterilizer, pressure, portable.
Stethoscope.
Sutures, absorbable.
Sutures, absorbable, with attached needle.
Sutures, nonabsorbable.
Sutures, nonabsorbable, with attached needle.
Syringes, Luer, reusable (hypodermic syringes).
Thermometers, clinical.
Tracheotomy tube.
Tube, nasogastric.
Tubing, rubber or plastic, and connectors.
Vascular prostheses.
Webbing, textile, with buckle.

    6. Laboratory Equipment and Supplies:
Bacteriological culture media and apparatus.
Balance, laboratory with weights.
Blood and urine analysis instruments, equipment and supplies.

[[Page 561]]

Chemical reagents, stains and apparatus.
Glassware cleaning equipment.
Laboratory glassware.
Microscope and slides.
Water purification apparatus.

                                 Group B

None.

                                ii. food

                                 Group A

    1. Milk group. Milk in all forms, milk products. Important for 
calcium, riboflavin, protein, and other nutrients.
    2. Meat and meat alternate group. Meat, poultry, fish, eggs; also 
dry beans, peas, nuts. Important for protein, iron, and B-vitamins.
    3. Vegetable-fruit group. Including 1. Dark Green and yellow 
vegetables. Important for Vitamin A. 2. Citrus fruit or other fruit or 
vegetables. Important for Vitamin C. 3. Other fruits and vegetables, 
including potatoes.
    4. Grain products. Especially enriched, restored, cereal and cereal 
products, and bread, flours, and meals. Important for energy, protein, 
iron, and B-vitamins.
    5. Fats and oils. Including butter, margarine, lard, and other 
shortening oils. Important for palatability and food energy; some for 
Vitamin A and essential fatty acids.
    6. Sugars and syrups. Important for palatability and food energy.
    7. Food adjuncts. Certain food adjuncts should be provided to make 
effective use of available foods. These include antioxidants and other 
food preservatives, yeast, baking powder, salt, soda, seasonings and 
other condiments. In addition, coffee, tea, and cocoa are important for 
morale support.

                                 Group B

Food containers.
Nitrogenous fertilizers.
Seed and livestock feed.
Salt for livestock.
    Veterinary Medical Items:
Anthrax vaccine.
Black leg vaccine.
Hog cholera vaccine.
Newcastle vaccine.

              iii. body protection and household operations

                                 Group A

    1. Clothing:
Gloves and mittens.
Headwear.
Hosiery.
Outerwear.
Shoes and other footwear.
Underwear.
Waterproof outer garments.

    2. Personal Hygiene Items:
Diapers, all types.
Disposable tissues.
First aid items (included on Health Supplies and Equipment List).
Nipples.
Nursing bottles, all types.
Pins.
Sanitary napkins.
Soaps, detergents, and disinfectants.
Toilet tissue.

    3. Household Equipment:
Bedding.
Canned heat.
Cots.
Hand sewing equipment.
Heating and cooking stoves.
Incandescent hand portable lighting equipment (including flashlights, 
lamps, batteries).
Kitchen, cooking, and eating utensils.
Lamps (incandescent medium base) and lamp holders.
Matches.
Nonelectric lighting equipment.
Sleeping bags.

                                 Group B

None.

                      iv. electric power and fuels

    1. Electric Power.

                                 Group A

Electricity.

                                 Group B

Conductors (copper and/or aluminum), including bare cable for high 
voltage lines and insulated wire or cable for lower voltage distribution 
circuits.
Switches and circuit breakers.
Insulators.
Pole line hardware.
Poles and crossarms.
Transformers (distribution, transmission, and mobile).
Tools for live-circuit operations, including rubber protective 
equipment, and linemen's tools.
Utility repair trucks, fully equipped.
Prime mover generator sets up to 501 kilowatts and 2400 volts, including 
portable and mobile sets up to 150 kilowatts and 110/220/440 volts, 3-
phase, 60-cycle complete with fuel tank and switchgear in self-contained 
units.

    2. Petroleum Products.

                                 Group A

Gasoline.
Kerosene.
Distillate fuel oil.
Residual fuel oil.
Liquefied petroleum oil.

[[Page 562]]

Lubricating oil.
Grease.

                                 Group B

Storage tanks.
Pumps for loading and unloading.
Pressure containers and fittings for liquefied petroleum gas.

    3. Gas.

                                 Group A

Natural gas.
Manufactured gas.

                                 Group B

Various sizes of pipe (mostly steel).
Various sizes of valves, fittings, and pressure regulators.
Specialized repair trucks and equipment.

    4. Solid Fuels.

                                 Group A

Coal and coke.

                                 Group B

Conveyor belting.
Insulated trail cables.
Trolley feeder wire.
Roof bolts.

                     v. sanitation and water supply

                                 Group A

    1. Water.

    2. Water Supply Materials:
    a. Coagulation:
Ferric chloride.
Ferrous sulfate.
Ferric sulfate.
Chlorinated copperas.
Filter alum.
Hydrated lime.
Pulverized limestone.
Soda ash.
    b. Disinfection Chemicals:
High-test hypochlorites (70 percent) in drums, cans, ampules.
Iodine tablets.
Liquid chlorine, including containers.
Chlorine compounds (not gas).
    c. Miscellaneous Materials:
Diatomaceous earth.
Activated carbon.

    3. Chemical Biological, and Radiological CBR Detection, Protection, 
and Decontamination Items:
Calibrators.
Chemical agent detection kits, air, food, and water.
Dosimeters and chargers.
Protective masks, clothing, helmets.
Survey meters (Alpha, Beta, Gamma).
Warning signs--biological, chemical, and radiological contamination.

    4. Insect and Rodent Control Items:
    a. Insecticides:
DDT, water dispersible powder (75 percent).
Lindane powder, dusting (1 percent).
Malathion, liquid, emulsifiable concentrate (57 percent).
Deet (diethyltoluamide) 75 percent in denatured alcohol.
Pyrethrum.
    b. Rodenticides:
Anticoagulant type, ready-mixed bait.
``1080'' (sodium monofluoroacetate) (for controlled use only).

    5. General Sanitation:
Lye.

                                 Group B

    1. General Supplies and Equipment:
Chemical feeders.
Mobile and portable pressure filters.
Chlorinators (gas and hypochlorites).
Pumps and appurtenances, Hand--Electric--Gasoline--Diesel.
Well-drilling equipment, including well casing, drive pipe and drive 
points.

    2. Storage and Transport Equipment:
Lyster bags.
Storage tanks, collapsible and portable.
Storage tanks, rigid, transportable.
Storage tanks, wood stave, knock-down.

    3. Laboratory Equipment and Supplies:
Membrane filter kits with filters and media.
Chlorine and pH determination equipment.

    4. Sanitation Equipment:
Hand sprayer, continuous type.
Hand sprayer, compression type.
Hand duster, plunger type.
Spraying equipment for use with helicopter, fixed-wing light aircraft, 
high-speed fixed-wing attack aircraft, and cargo-type aircraft.

     vi. emergency housing and construction materials and equipment

                                 Group A

Asphalt and tar roofing and siding products.
Builders hardware--hinges, locks, handles, etc.
Building board, including insulating board, laminated fiberboard, 
hardpressed fiberboard, gypsum board, and asbestos cement (flat sheets 
and wallboard).
Building papers.
Plastic patching, couplings, clamps, etc. for emergency repairs.
Plumbing fixtures and fittings.
Prefabricated emergency housing.
Rough hardware--nails, bolts, screws, etc.
Sewer pipe and fittings.
Tents and tarpaulins; canvas, plastics, and other similar materials.
Lumber and allied products; Lumber, principally 1-inch and 2-inch, minor 
quantities of small and large timbers; siding and flooring; plywood; 
millwork, doors, and windows.

[[Page 563]]

Masonry products--brick, cement, lime, concrete block, hollow tile, etc.
Translucent window coverings.
Water pipe and hose, plus fittings--all types including fire hose.

                                 Group B

None.

                         vii. general use items

                                 Group A

None.

                                 Group B

Batteries, wet and dry cell.
Bulldozers.
Fire fighting equipment.
Light equipment and hand tools (including electric powered) for 
carpentry, masonry, plumbing, and excavation.
Pipe installation materials and equipment.
Refrigerators, mechanical.
Rigging tools--cables, ropes, tackles, hoists, etc.
Tank railroad cars.
Tank Trucks and trailers.
Tires.
Trenching equipment.
Truck tractors and trailers, including low bed.
Trucks up to five tons (25 percent equipped with power takeoff).
Welding equipment and supplies (electric and acetylene).



PART 324--NATIONAL SECURITY POLICY GOVERNING SCIENTIFIC AND ENGINEERING MANPOWER (DMO-5)--Table of Contents




Sec.
324.1  Purpose.
324.2  Background.
324.3  Policy.
324.4  Action.

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq.; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 12148 
of July 20, 1979, 44 FR 43239.

    Source: 45 FR 44582, July 1, 1980, unless otherwise noted.



Sec. 324.1  Purpose.

    This part provides current policy on the training and utilization of 
scientific and engineering manpower as it affects the national security.



Sec. 324.2  Background.

    (a) The essential role of scientific and engineering manpower in any 
period of national emergency is well recognized. While the quantity and 
quality of scientific and engineering manpower are materially influenced 
by Government action, the development and use of such manpower are 
greatly dependent upon policies and actions of the private sector.
    (b) Since the issuance of Defense Manpower Policy 8, many steps have 
been taken by the Government and the private sector to assure the 
adequacy of scientific and engineering manpower for total national 
security. This statement of current Government policy is intended to 
continue the constructive policies and actions already in being and to 
assure the adequacy of this important national resource during a major 
emergency.



Sec. 324.3  Policy.

    It is the policy of the Federal Government to project the Nation's 
scientific and engineering manpower requirements sufficiently into the 
future to permit long-range planning; to relate those requirements to 
other resource requirements, including requirements for other manpower 
skills; to relate peacetime and emergency requirements; and to cooperate 
with educators, industry, professional societies, and employee 
associations to:
    (a) Support training and education programs which enhance our 
national security through the development of defense related skills.
    (b) Stimulate individuals with scientific and technical aptitudes to 
attain the highest level of formal education in science and technology 
for which they are capable.
    (c) Stress basic principles and fundamentals of science and 
technology in educational curricula.
    (d) Offer significant on-the-job training which will broaden the 
experience and capabilities of individual scientists and engineers.
    (e) Provide realistic retraining opportunities which will assist in 
updating the knowledge and skills of scientists and engineers.

[[Page 564]]

    (f) Broaden the selection base in order to assure entry of all 
qualified individuals, including women and members of minority groups, 
into scientific and technical positions.
    (g) Encourage continued employment of senior scientists and 
engineers who are yet capable of efficient performance, even though the 
retention of such personnel may be only on a part-time basis.
    (h) For maximum security explore and, where appropriate, adopt the 
principle of decentralized scientific and technical operations.



Sec. 324.4  Action.

    Consistent with the policies contained herein, each department and 
agency of the Federal Government should (a) review its current manpower 
policies and update its policies and programs for scientific and 
engineering manpower to assure their maximum contribution to national 
security and emergency preparedness, (b) base its policies and actions 
on projected peacetime and emergency requirements, and (c) encourage and 
support private sector efforts to assure the fulfillment of future 
requirements for this critical manpower resource.



PART 325--EMERGENCY HEALTH AND MEDICAL OCCUPATIONS--Table of Contents




Sec.
325.1  Purpose.
325.2  Scope and applicability.
325.3  Policy.

    Authority: 50 U.S.C. 2061; E.O. 11490; E.O. 12148.

    Source: 45 FR 8601, Feb. 8, 1980, unless otherwise noted. 
Redesignated at 45 FR 8601, July 1, 1980.



Sec. 325.1  Purpose.

    The Director, Federal Emergency Management Agency, after agreement 
with the Secretary of Labor and the Secretary of Health, Education, and 
Welfare, issues this List of Emergency Health and Medical Occupations in 
support of part 11, Executive Order 11490, as amended. This List 
provides guidance to all officials concerned with planning for the 
emergency training and emergency assignment of health and medical 
personnel engaged in the listed occupations.



Sec. 325.2  Scope and applicability.

    The list of Emergency Health and Medical Occupations identifies 
those occupations which would be needed to provide public health and 
medical services during and immediately after an emergency in which 
survival of the population is the primary consideration.



Sec. 325.3  Policy.

    (a) Training for emergency. Sections 1101, 1103(1), 1104(2), and 
1325(4) of Executive Order 11490 specify emergency training 
responsibilities of the Secretary of Health and Human Services. 
Depending on the availability of resources, the Secretary of Health and 
Human Services, in cooperation with other Federal departments/agencies, 
State and local governments, and appropriate private sector 
organizations, shall:
    (1) Define the emergency roles which would be performed by those 
filling the occupations included on the List of Emergency Health and 
Medical Occupations;
    (2) Develop and implement appropriate emergency training programs 
designed to prepare individuals in these occupations to perform 
effectively their specialized roles in a national emergency as 
distinguished from their peacetime functions; and
    (3) Set quantitative and qualitative training objectives for each 
occupational category and develop arrangements for payment for the 
training.
    (b) Allocation of the health and medical workforce in emergencies. 
During a declared national emergency, in which survival of the 
population is the preeminent consideration, the provision of health and 
medical services would be a priority emergency response and recovery 
function. To ensure that this priority need is met, officials 
responsible for the allocation of the workforce in emergency will use 
the List of Emergency Health and Medical Occupations as an aid in the 
mobilization of available health and medical personnel and the staffing 
of emergency health and medical services. Emergency situations may 
dictate the need to redistribute,

[[Page 565]]

on a temporary basis, health and medical personnel in order to provide 
for equitable and needed coverage of the emergency caseload. Although 
Federal, State, and local health officials are expected to have the 
requisite authority to take such actions in a declared national 
emergency, it is probable that the traditional role of volunteerism in 
the health and medical field will prevail and minimize the need for 
involuntary controls. Jurisdiction over health and medical personnel in 
actual emergencies would remain with their employers and the integrity 
of institutional services will be preserved wherever possible, except as 
noted above.
    (c) Use of health and medical personnel in other priority emergency 
activities. While health and medical services will be an immediate 
priority need in most declared national emergencies, as the situation 
unfolds, different priority needs will evolve, placing unusual demand on 
scarce workforce resources. As emergency health hazards and medical care 
loads are brought under control, it may be possible to release certain 
health and medical personnel who fill positions in the occupational 
categories listed on the List of Emergency Health and Medical 
Occupations for augmentation of other essential work groups on a 
temporary basis. Where possible, such reassignments should be 
accomplished on a consultative, voluntary basis.
    (d) Ancillary and support personnel. Vital to the effective 
performance of the emergency health and medical team are individuals in 
direct support occupations such as hospital, sanitation, and laboratory 
helpers, as well as engineering, clerical, food service, and custodial 
personnel. Personnel in these ancillary and support categories will 
remain on their jobs during and after a declared national emergency 
until health hazards and medical care loads are brought under control. 
Reassignment of these personnel will follow the policy cited in 
paragraph (c) of this section.
    (e) List of emergency health manpower occupations.\1\
---------------------------------------------------------------------------

    \1\ Includes students, trainees, and interns whose training or 
education leading to any of the indicated skills is sufficiently 
advanced to qualify them to contribute to the technical tasks of 
providing health services.

                                                                        
------------------------------------------------------------------------
                                                             Code number
                     Occupational title                           \2\   
------------------------------------------------------------------------
Administrator, Hospital....................................      187.117
Admitting Officer (Medical Service)........................      205.137
Ambulance Attendant (Medical Service)......................      355.374
Ambulance Driver (Medical Service).........................      913.683
Audiologist................................................      076.101
Audiometrist...............................................      078.362
Bacteriologist.............................................      041.061
Bacteriologist, Dairy......................................      041.061
Bacteriologist, Fishery....................................      041.061
Bacteriologist, Food.......................................      041.061
Bacteriologist, Medical....................................      041.061
Bacteriologist, Pharmaceutical.............................      041.061
Biochemist.................................................      041.061
Birth Attendant............................................      354.377
Chemist, Clinical..........................................      041.061
Chemist, Pharmaceutical....................................      041.061
Dentist....................................................          072
Dental Assistant (Medical Service).........................      079.371
Dental Hygienist...........................................      078.361
Dietitian, Clinical (Prof. & Kindred)..................      077.127
Emergency Medical Services Coordinator.....................      079.117
Entomologist (Prof. & Kindred).........................      041.061
Food and Drug Inspector (Government Services)..............      168.267
Health Officer, Field......................................      168.167
Health Physicist...........................................      079.021
Helminthologist............................................      041.061
Histopathologist...........................................      041.061
Hygienist, Industrial......................................      079.161
Industrial Health Engineer.................................      012.167
Laboratory Assistant, Blood and Plasma.....................      078.687
Medical Apparatus Model Maker..............................      712.261
Medical Assistant..........................................      079.367
Medical Laboratory Assistant...............................      078.381
Medical Record Administrator...............................      079.169
Nurse Aide.................................................      355.674
Nurse, Practical...........................................      354.374
Nurse, Licensed Practical..................................      079.374
Nurse, Registered..........................................          075
Optician, Dispensing.......................................      713.361
Optician...................................................      716.280
Optometrist................................................      079.101
Orderly (Medical Service)..................................      355.674
Orthopedic Assistant.......................................      712.661
Orthoptist (Medical Service)...............................      079.371
Orthotist..................................................      078.261
Osteopathic Physician......................................      071.101
Parasitologist.............................................      041.061
Pathologist................................................      070.061
Pharmacist.................................................          074
Pharmacologist.............................................      041.061
Physicians and Surgeons....................................          070
Physician Assistant........................................      079.364
Podiatrist.................................................      079.101
Prosthetist................................................      078.261
Protozoologist.............................................      041.061
Psychiatric Aide...........................................      355.377
Psychologist, Clinical.....................................      045.107
Public Health Educator (Prof. & Kindred)...............      079.117
Public Health Microbiologist...............................      041.261
Radiation Monitor..........................................      199.167
Sanitarian.................................................      079.117
Sanitary Engineer..........................................      005.061
Social Worker, Medical.....................................      195.107
Social Worker, Psychiatric.................................      195.107
Superintendent, Hospital...................................      187.117
Supervisor, Dental Laboratory..............................      712.131
Technicians:                                                            
  Audiometric Technican....................................      078.362

[[Page 566]]

                                                                        
  Biomedical Equipment Technician (inst. and app.; medical              
   service)................................................      719.261
  Biomedical Equipment Technician (Prof. & Kindred)....      019.261
  Blood-Bank Technician....................................      078.381
  Cytotechnician...........................................      078.381
  Dental-Laboratory Technician.............................      712.381
  Dental Technician........................................      712.381
  Dialysis Technician......................................      078.362
  Electrocardiograph Technician............................      078.362
  Electroencephalographic Technician.......................      078.362
  Emergency Medical Technician.............................      079.374
  Hematology Technician....................................      078.381
  Laboratory Technician, Veterinary........................      073.361
  Medical Technician.......................................      078.381
  Medical Laboratory Technician............................      078.381
  Orthodontic Technician...................................      712.381
  Orthotics-Prosthetics Technician.........................      712.381
  Sereology Technician.....................................      078.381
  Surgical Technician......................................      079.374
  Tissue Technician........................................      078.381
  X-ray Technician.........................................      199.361
Technologists:                                                          
  Biochemistry Technologist................................      078.261
  Blood-Bank Technologist..................................      078.361
  Cytotechnologist.........................................      078.281
  Hermatology Technologist.................................      078.361
  Histopathology Technologist..............................      078.361
  Medical Technologist.....................................      078.361
  Microbiology Technologist................................      078.261
  Nuclear Medical Technologist.............................      078.361
  Radiologic Technologist..................................      078.362
  Serology Technologist....................................      078.361
  Tissue Technologist......................................      078.361
  X-ray Technologist.......................................      078.362
Therapists:                                                             
  Inhalation Therapist.....................................      079.361
  Occupational Therapist...................................      076.121
  Orientation Therapist for Blind..........................      076.221
  Physical Therapist.......................................      076.121
  Respiratory Therapist....................................      079.361
Veterinarians \3\..........................................          073
Virologist.................................................      041.061
------------------------------------------------------------------------
\2\ Dictionary of Occupational Titles/Department of Labor/Fourth        
  Edition.                                                              
\3\ Though current planning provides that many veterinarians be utilized
  in casualty care and preventive medicine activities immediately after 
  an emergency, veterinarians will continue to be needed to perform     
  services of a strictly veterinary nature after most of the human      
  casualties have been cared for temporarily. Such veterinary activities
  will include protection of food, animals against diseases and the     
  effects of atomic, biological, and chemical warfare; meat and poultry 
  inspection and supplementing food inspection forces for certain food  
  processing plants, and food storage facilities.                       


[45 FR 8601, Feb. 8, 1980. Redesignated at 45 FR 8601, July 1, 1980 and 
amended at 51 FR 34606, Sept. 30, 1986]



PART 327--POLICY ON USE OF GOVERNMENT-OWNED INDUSTRIAL PLANT EQUIPMENT BY PRIVATE INDUSTRY (DMO-10A)--Table of Contents




Sec.
327.1  Purpose.
327.2  Scope and applicability.
327.3  Policy.
327.4  Disputes.
327.5  Reports.

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq.; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 12148 
of July 20, 1979, 44 FR 43239.

    Source: 45 FR 44583, July 1, 1980, unless otherwise noted.



Sec. 327.1  Purpose.

    This part establishes policy on the use by private industry of 
Government-owned industrial plant equipment. This policy is necessary to 
maintain a highly effective and immediately available reserve of such 
equipment for the emergency preparedness programs of the U.S. 
Government.



Sec. 327.2  Scope and applicability.

    (a) This part applies to all Federal departments and agencies 
having, for purposes of mobilization readiness, Government-owned 
industrial plant equipment under their jurisdiction or control and 
having emergency preparedness functions assigned by Executive orders 
concerning use of that equipment.
    (b) As used herein, industrial plant equipment means those items of 
equipment, each with an acquisition cost of $1,000 or more, that fall 
within specified classes of equipment listed in DOD regulations. Classes 
of equipment may from time to time be added to or deleted from this 
list.



Sec. 327.3  Policy.

    (a) General. (1) Primary reliance for defense production shall be 
placed upon private industry.
    (2) When it is determined by an agency that, because of the lack of 
specific industrial plant equipment, private industry of the United 
States cannot be relied upon for needed Government production, that 
agency may provide to private industry such Government-owned industrial 
plant equipment as is deemed necessary to ensure required production 
capability. Requirements for such equipment should be reviewed at least 
annually to ascertain the continuing need, particularly with a view 
toward private industry furnishing the equipment for long term 
requirements.
    (3) When it is necessary for Federal agencies to supply Government-
owned

[[Page 567]]

industrial plant equipment to private industry, these agencies will 
maintain uniformity and fairness in the arrangements for the use of this 
equipment by following regulations for the use of such equipment as 
developed and published by the Secretary of Defense pursuant to section 
809 of Public Law 93-155. The regulations to be developed by the 
Secretary of Defense shall be in consonance with this order. These 
regulations will attempt to ensure that no Government contractor is 
afforded an advantage over his competitors and that Government-owned 
industrial plant equipment is maintained properly and kept immediately 
available for the emergency preparedness needs of the United States.
    (b) Interagency use of idle equipment. In any instances in which a 
Government contractor cannot meet Government production schedules 
because necessary industrial plant equipment is not available from 
private industry or from the contracting Federal department or agency, 
idle industrial plant equipment under the control of other Federal 
agencies may be made available for this purpose through existing 
authorities on a transfer, loan, or replacement basis by interagency 
agreement.
    (c) Availability of equipment for emergency use. Government-owned 
industrial plant equipment may be provided by controlling agencies for 
emergency use by essential Government contractors whose facilities have 
been damaged or destroyed.
    (d) Uniform rental rates. All new agreements entered into by any 
agency of the Federal Government under which private business 
establishments are provided with Government-owned industrial plant 
equipment shall be subject to rental rates established by the Secretary 
of Defense pursuant to section 809 of Public Law 93-155. The rental 
rates shall ensure a fair and equitable return to the U.S. Government 
and be generally competitive with commercial rates for like equipment.
    (e) Use of Government-owned industrial plant equipment for 
commercial (non-Government) purposes. Subject to adequate controls being 
established under DOD regulations pursuant to Public Law 93-155, and 
statutory authority for leasing, Government-owned industrial plant 
equipment may be authorized for commercial use by contractors performing 
contracts or subcontracts for the Government agency if it is necessary 
to keep the equipment in a high state of operational readiness through 
regular usage to support the emergency preparedness programs of the U.S. 
Government.



Sec. 327.4  Disputes.

    In the event of an interagency dispute about the regulations 
developed by the Department of Defense in accordance with this order, 
the Director, Federal Emergency Management Agency, shall adjudicate.



Sec. 327.5  Reports.

    Such reports of operations under this order as may be required by 
the Federal Emergency Management Agency, shall be submitted to the 
Director.



PART 328--GENERAL POLICIES FOR STRATEGIC AND CRITICAL MATERIALS STOCKPILING (DMO-11)--Table of Contents




Sec.
328.1  Purpose.
328.2  Policies.
328.3  Delegation of authority--Preparation of reports.

    Authority: Strategic and Critical Materials Stock Piling Act, as 
amended, 50 U.S.C. 98; National Security Act of 1947, as amended, 50 
U.S.C. 404; Defense Production Act of 1950, as amended, 50 U.S.C. app. 
2061 et seq.; Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 
329; E.O. 12148 of July 20, 1979, 44 FR 43239; E.O. 12155 of Sept. 10, 
1979, 44 FR 53071.

    Source: 45 FR 44584, July 1, 1980, unless otherwise noted.



Sec. 328.1  Purpose.

    This part sets forth revised policies for the administration of 
strategic and critical materials stockpiling.



Sec. 328.2  Policies.

    By virtue of the authority vested in me by Executive Order 11051, 
the following policies are promulgated to govern the administration of 
strategic and critical materials stockpiling:
    (a) General. The strategic stockpile shall be so administered as to 
assure

[[Page 568]]

the availability of strategic and critical materials in times of 
national emergency.
    (b) Period covered by stockpiling. All strategic stockpile goals for 
conventional war shall be limited to meeting estimated shortages of 
materials for the first three years of a war.
    (c) Stockpile objectives. Strategic stockpile goals shall be 
adequate for supplies of these materials in time of national emergency.
    (d) Emergency requirements. The requirements estimates for use in 
times of national emergency, where appropriate, reflect specific 
requirements to the extent available. It shall be assumed that the total 
requirements will approximate the capacity of industry to consume, 
taking into account necessary wartime limitation, conservation and 
substitution measures. Departments and agencies having responsibilities 
with regard to requirements data on stockpile materials shall review 
such data and provide, upon his request, the Director of the Federal 
Emergency Management Agency with information as to all significant 
changes.
    (e) Emergency supplies. Estimates of supply for the mobilization 
period shall be based on readily available capacity and known resources 
in the United States and such other countries as directed by the 
National Security Council. Departments and agencies having the 
responsibilities with regard to supply data on stockpile materials shall 
review such data and provide the Director of the Federal Emergency 
Management Agency upon his request, with information as to all 
significant changes.
    (f) Provision for special-property materials. Arrangements shall be 
made for the regular availability of objective scientific advice to 
assist in the evaluation of prospective needs for high-temperature and 
other special-property materials. Such materials shall be stockpiled if 
reasonably firm minimum requirements indicate the existence of a supply 
deficit in the event of an emergency.
    (g) Supply-requirements reviews. The supply-requirements balance for 
any material that is now or may become important to defense shall be 
kept under continuing surveillance. Supply-requirements data submitted 
pursuant to paragraphs (d) and (e) of this section shall be examined 
upon receipt. A full-scale review may be undertaken at any time that a 
change is believed to be taken place that would have a significant 
bearing on the wartime readiness position. Priority of review shall be 
given to materials under procurement.
    (h) Procurement policy. Unfilled objectives shall be attained 
expeditiously by cash procurement or otherwise as the Director shall 
deem appropriate. Long-term contracts shall contain termination clauses 
whenever possible. All feasible measures for meeting materials deficits 
in an emergency shall be considered. Stockpiling shall be undertaken 
only when it is clear that it is the best solution.
    (i) Maintenance of the mobilization base. A portion of the 
mobilization base comprises existing or projected productive capacity 
the output of which will be relied on to fill defense requirements. All 
inventories of Government-owned materials held for long-term storage are 
a part of the mobilization base and should be weighed in determining the 
need for a relevant portion of the productive segment of the 
mobilization base. The maintenance of any portion of the productive 
segment of the mobilization base through stockpile procurement shall be 
undertaken only within unfilled stockpile objectives.
    (j) Upgrading to ready usability. In order to satisfy the initial 
surge of abnormal demands following intensive mobilization in a period 
of national emergency, stockpile objectives of upgraded forms of such 
materials shall be established for immediate use in such circumstances. 
For this purpose a minimum readiness inventory shall be provided near 
centers of consumption. Materials in Government inventories may be 
upgraded for such stockpiling purposes only when the net cost of such 
processing including transportation and handling is less than the cost 
of new material. Materials should be upgraded to forms which will permit 
the greatest use-flexibility. Surplus materials may be used to pay for 
the upgrading of the same or other materials required to meet objectives 
providing that the use of excess materials for

[[Page 569]]

this purpose is in conformance with disposal criteria.
    (k) Beneficiation of subspecification materials. Subspecification-
grade materials in Government inventories may be beneficiated within the 
limits of the objectives when this can be accomplished at less cost than 
buying new material.
    (l) Cancellation of commitments. Commitments for deliveries to 
national stockpile and Defense Production Act inventories beyond the 
objectives shall be canceled or reduced when settlements can be arranged 
which would be mutually satisfactory to the supplier and the Government 
and which would not be disruptive to the economy or to projects 
essential to the national security. Such settlements may take into 
account anticipated profits and cover adjustments for above-market 
premiums. The settlement of commitments may be made through the payment 
of cash or through the use of surplus materials. Responsibility with 
respect to the settlement of commitments in the light of overall 
interest of the Government rests with the Administrator of General 
Services who shall keep other agencies advised and consult with them to 
the extent appropriate.
    (m) Retention of other inventories. Within the limits of unfilled 
stockpile objectives, stockpile-grade materials in the Defense 
Production Act and the supplemental stockpile inventories shall be 
retained for national stockpile purposes.
    (n) Disposals: (1) The Director of the Federal Emergency Management 
Agency will authorize the disposal of excess materials only after due 
regard to: (i) Avoidance of serious disruption of the usual markets of 
producers, processors and consumers, and (ii) the protection of the 
United States against avoidable loss.
    (2) In general, excess materials constitute unneeded assets and 
shall be disposed of as expeditiously as possible.
    (3) In making such disposals preference shall be given to materials 
that deteriorate, that are likely to become obsolete, that do not meet 
quality standards, or that do not have stockpile objectives.
    (4) The Administrator of General Services shall be responsible for 
disposal of excess materials. He shall advise the Secretary of State and 
the appropriate Assistant to the President in advance on all disposal 
plans.
    (o) Government use. Under such policies and procedures as the 
Administrator of General Services may prescribe, Government agencies 
which directly or indirectly use strategic and critical materials shall 
fulfill their requirements through the use of materials in Government 
inventories that are excess to the needs thereof. Direct use means use 
in a Government-owned and operated facility and use in a Government-
owned facility which is operated by a contractor for the Government. 
Indirect Government use means use by prime contractors and all tiers 
ofsubcontractors in the production of items being procured by the 
Government.



Sec. 328.3  Delegation of authority--Preparation of reports.

    The Administrator of General Services shall prepare on behalf of the 
Director of the Federal Emergency Management Agency and forward to him 
for transmittal to the Congress reports as required by the Director.



PART 329--USE OF PRIORITIES AND ALLOCATION AUTHORITY FOR FEDERAL SUPPLY CLASSIFICATION (FSC) COMMON USE ITEMS (DMO-12)--Table of Contents




Sec.
329.1  Purpose.
329.2  Policies.
329.3  Procedures.
329.4  Implementation.

    Authority: Defense Production Act of 1950, as amended, 50 U.S.C. 
app. 2061 et seq.; Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., 
p. 329; E.O. 12148 of July 20, 1979, 44 FR 43239; E.O. 10480 of Aug. 14, 
1953, (18 FR 4939) as amended.

    Source: 45 FR 44585, July 1, 1980, unless otherwise noted.



Sec. 329.1  Purpose.

    This part provides policy guidance concerning the use of priorities 
and allocation authority under title I of the Defense Production Act of 
1950, as

[[Page 570]]

amended, for the procurement of common use items in the Federal Supply 
Classification (FSC).



Sec. 329.2  Policies.

    The following guidance is provided pursuant to the Defense 
Production Act of 1950, as amended; section 201 of Executive Order 
10480, and Sec. 322.2 of this chapter (DMO-3).
    (a) Priority ratings under title I of the Defense Production Act of 
1950, as amended, are not authorized for certain FSC Groups, Classes, 
and Items:
    (1) Which are of the types commonly available in commercial markets 
for general consumption,
    (2) Which do not require major modification when purchased for 
military or other ratable government use, and
    (3) Which are in sufficient supply as to cause no hindrance to the 
accomplishment of military or other national defense objectives.

Such Groups, Classes, and Items will be as specified from time to time 
by the Department of Commerce with the approval of the Federal Emergency 
Management Agency. Procurement in these Groups, Classes, and Items is to 
be made without priority assistance, including single service 
procurement that may include defense and defense-supporting needs. In 
the event procurement difficulties are encountered which threaten timely 
delivery, application for special assistance may be made for those 
categories of supply authorized special assistance in existing lists, 
and must be accompanied by full justification to support the need for 
such assistance.
    (b) Priority ratings may be used for the procurement of other 
authorized FSC Groups, Classes, and Items only in quantities required to 
meet the needs of approved programs of ratable agencies. The quantities 
of current procurement of each Group, Class, and Item shall be based on 
and shall not exceed the ratio of rated purchases to total purchases for 
that Group, Class, and Item that was consummated in the 6-month period 
preceding the first day of January and July in each year. Any other 
periodic cycle considered suitable and agreed to by the Domestic and 
International Business Administration, Department of Commerce, and the 
procuring agency may be substituted.
    (c) In the interest of minimizing administrative costs, where rated 
procurement under paragraph (b)(2) of this section, constitutes 97 
percent or more of the total procurement of a Group, Class, or Item, all 
of the Group, Class, or Item may be bought on ratings.



Sec. 329.3  Procedures.

    Requests for additional authorizations of Classes, Groups, or Items 
should be presented to General Services Administration (AP), Washington, 
DC, 20405, accompanied by a statement of justification indicating why 
the Class, Group, or Item should be regarded as necessary or appropriate 
to promote the national defense and why defense-related requirements 
cannot be met without the use of priorities.



Sec. 329.4  Implementation.

    Departments and agencies involved with this program shall issue 
implementing instructions and directives no later than 30 work days from 
the effective date of this order. Copies of such instructions, 
directives, and related documents shall be furnished to the General 
Services Administration (AP) on a routine basis as issued.



PART 330--POLICY GUIDANCE AND DELEGATION OF AUTHORITIES FOR USE OF PRIORITIES AND ALLOCATIONS TO MAXIMIZE DOMESTIC ENERGY SUPPLIES IN ACCORDANCE WITH SUBSECTION 101(c) OF THE DEFENSE PRODUCTION ACT OF 1950, AS AMENDED (DMO-13)--Table of Contents





Sec.
330.1  Purpose.
330.2  Policies.
330.3  Delegation of authority.

    Authority: Defense Production Act of 1950, as amended, including 
amendment to sec. 101(c) by sec. 104 of the Energy Policy and 
Conservation Act (Pub. L. 94-163) 50 U.S.C. app. 2061 et seq.; 
Reorganization Plan No. 3 of 1978, 3 CFR, 1978 Comp., p. 329; E.O. 12148 
of July 20, 1979, 44 FR 43239; E.O. 11912 of April 13, 1976.

    Source: 45 FR 44586, July 1, 1980, unless otherwise noted.

[[Page 571]]



Sec. 330.1  Purpose.

    This part:
    (a) Establishes policy guidance on determination and use of 
priorities and allocations for materials and equipment to maximize 
domestic energy supplies pursuant to section 104 of the Energy Policy 
and Conservation Act (Pub. L. 94-163, 89 Stat. 878), which added 
subsection 101(c) to the Defense Production Act of 1950, as amended (the 
Act); and
    (b) Delegates authority and assigns responsibility related thereto 
pursuant to sections 7 and 8 of Executive Order 11912, dated April 13, 
1976.



Sec. 330.2  Policies.

    (a) The authority of subsection 101(c) of the Act to require the 
allocation of, or priority performance under contracts or orders 
relating to, supplies of materials and equipment to maximize domestic 
energy supplies shall be limited to those exceptional circumstances when 
it is found that:
    (1) Such supplies of material and equipment are scarce, critical, 
and essential; and
    (2) The maintenance or furtherance of exploration, production, 
refining, transportation, or conservation of energy supplies, or the 
construction and maintenance of energy facilities, cannot reasonably be 
accomplished without exercising this authority.
    (b) The authority contained in subsection 101(c) shall not be used 
to require priority performance under contracts or orders relating to, 
or the allocation of, any supplies of materials and equipment except for 
programs or projects to maximize domestic energy supplies as 
specifically determined by the Secretary of Energy, after coordination 
with the Director, Federal Emergency Management Agency.
    (c) The allocation of, or priority performance under contracts or 
orders relating to, supplies of materials and equipment in support of 
authorized programs or projects shall be so undertaken as to ensure 
that:
    (1) Supplies of the specified materials and equipment are available 
to the extent practicable on time and in proper quantity to authorized 
programs or projects.
    (2) The demands of these authorized programs or projects are 
distributed among suppliers on a fair and equitable basis.
    (3) Allotments of supplies of materials and equipment are not made 
in excess of actual current requirements of these authorized programs or 
projects.
    (4) Fulfillment of the needs of these authorized programs and 
projects are achieved in such manner and to such degree as to minimize 
hardship in the market place.
    (d) The authority of subsection 101(c) of the Act will not be used 
to control the general distribution of any supplies of material and 
equipment in the civilian market, as that phrase is used in subsection 
101(b) of the Act, except after Presidential approval as required by 
subsection 7(d) of Executive Order 11912.



Sec. 330.3  Delegation of authority.

    (a) The functions of the Director of the Federal Management Agency 
under subsection 101(c) of the Act are hereby delegated to the Secretary 
of Commerce with respect to the areas of responsibility designated and 
subject to the limitations prescribed and section 7 of Executive Order 
11912. Specifically:
    (1) The Secretary of Commerce is delegated the function, provided in 
subsection 101(c)(1) of the Act, of requiring the allocation of, or 
priority performance under contracts or orders (other than contracts of 
employment) relating to, supplies of materials and equipment to maximize 
domestic energy supplies, if the findings specified in subsection 
101(c)(3) of the Act are made.
    (2) The Secretary of Commerce is delegated those functions provided 
in subsection 101(c)(3) of the Act, but shall redelegate to the 
Secretary of Energy the function of making the findings that supplies of 
materials and equipment are critical and essential to maximize domestic 
energy supplies. The Secretary of Commerce shall retain the functions of 
finding that supplies of materials and equipment are scarce, and that 
the purposes described in subsection 101(c)(3)(B) of the Act cannot 
reasonably be accomplished

[[Page 572]]

without exercising the authority specified in subsection 101(c)(1). This 
finding will include, to the extent practicable, an assessment of the 
effects of using the authority for the project in question on other 
significantly impacted projects.
    (b) The Director of the Federal Emergency Management Agency shall be 
responsible for the overall coordination and direction of the functions 
provided by subsection 101(c) of the Act in a manner similar to the 
exercise of functions under subsections 101(a) and 101(b) of the Act. In 
line with these functions, the Director is also responsible for 
resolving any conflicts between claimant agencies regarding particular 
supplies of materials and equipment. In addition, the Federal Emergency 
Management Agency will monitor the impact of the implementation of the 
authorities of subsection 101(c) and other authorities under section 101 
of the Defense Production Act on each other and on the national economy.
    (c) The functions assigned, delegated, or required to be redelegated 
by this order to the Secretary of Commerce and the Secretary of Energy 
may not be redelegated to other agencies without first being coordinated 
with the Director, Federal Emergency Management Agency.
    (d) Procedures to execute the above delegations will be carried out 
in accordance with guidance provided by the Director, Federal Emergency 
Management Agency, pursuant to this order and Executive Order 11912.



PART 331--PRESERVATION OF THE MOBILIZATION BASE THROUGH THE PLACEMENT OF PROCUREMENT AND FACILITIES IN LABOR SURPLUS AREAS--Table of Contents




Sec.
331.1  Purpose.
331.2  Policy.
331.3  Scope and applicability.
331.4  Special consideration.
331.5  Production facilities.

    Authority: Reorganization Plan No. 3 of 1978, E.O. 10480, as 
amended, E.O. 12148.

    Source: 45 FR 34885, May 23, 1980, unless otherwise noted. 
Redesignated at 45 FR 44575, July 1, 1980.



Sec. 331.1  Purpose.

    Success of the national defense program depends upon efficient use 
of all of our resources, including the labor force and production 
facilities, which are preserved through utilizing the skills of both 
management and labor. A primary aim of Federal manpower policy is to 
encourage full utilization of existing production facilities and workers 
in preference to creating new plants or moving workers, thus assisting 
in the maintenance of economic balance and employment stability. When 
large numbers of new workers move to labor surplus areas, heavy burdens 
are placed on community facilities, such as schools, hospitals, housing, 
transportation, and utilities. On the other hand, when unemployment 
develops in certain areas, unemployment costs increase the total cost to 
the Government, and plants, tools, and workers' skills remain idle and 
unable to contribute to our national defense program. Consequently, it 
is the purpose of Defense Manpower Policy No. 4B to direct attention to 
the potential of labor surplus areas when awarding appropriate 
procurement contracts and when locating new plants or facilities.



Sec. 331.2  Policy.

    (a) It is the policy of the Federal Government to award appropriate 
contracts to eligible labor surplus area concerns, to place production 
facilities in labor surplus areas, and to make the best use of our 
natural, industrial and labor resources in order to achieve the 
following objectives:
    (1) To preserve management and employee skills necessary to the 
fulfillment of Government contracts and purchases;
    (2) To maintain productive facilities;
    (3) To improve utilization of the Nation's total economic potential 
by making use of the labor force resources of each area; and
    (4) To help ensure timely delivery of required goods and services 
and to promote readiness for mobilization by locating procurement where 
the needed labor force and facilities are fully available.
    (b) This policy is consonant with the intent of Public Law 95-89 and 
Public Law 95-507 as implemented by E.O.

[[Page 573]]

12073. In carrying out this policy, Federal departments and agencies 
shall be guided by E.O. 12073, the policy direction of the Office of 
Federal Procurement Policy and implementing regulations.



Sec. 331.3  Scope and applicability.

    The provisions of this policy apply to all Federal departments and 
agencies, except as otherwise prohibited by law. In addition to these 
normal duties;
    (a) The Secretary of Commerce shall:
    (1) In cooperation with State economic development agencies, the 
Secretary of Defense, the Administrator of General Services, and the 
Administrator of Small Business Administration, assist concerns which 
have agreed to perform contracts in labor surplus areas in obtaining 
Government procurement business by providing such concerns with timely 
information on proposed Government procurements.
    (2) Urge concerns planning new production facilities to consider the 
advantages of locating in labor surplus areas.
    (3) Provide technical advice and counsel to groups and organizations 
in labor surplus areas on planning industrial parks, industrial 
development organizations, expanding tourist business, and available 
Federal aids.
    (b) The Administrator of the Small Business Administration shall 
make available to small business concerns in labor surplus areas all of 
its services, endeavor to ensure opportunity for maximum participation 
by such concerns in Government procurement, and give consideration to 
the needs of these concerns in the making of joint small business set-
asides with Government procurement agencies.
    (c) OFPP shall coordinate the maintenance by Federal agencies of 
current information on the manufacturing capabilities of labor surplus 
area concerns with respect to Government procurement and disseminate 
such information to Federal departments and agencies.



Sec. 331.4  Special consideration.

    When an entire industry that sells a significant proportion of its 
production to the Government is generally depressed or has a significant 
proportion of its production, manufacturing and service facilities 
located in a labor surplus area, the Director, Federal Emergency 
Management Agency, or successor in function, after notice to and hearing 
of interested parties, will give consideration to appropriate measures 
applicable to the entire industry.



Sec. 331.5  Production facilities.

    All Federal departments and agencies shall give consideration to 
labor surplus areas in the selection of sites for Government-financed 
production facilities, including expansion, to the extent that such 
selection is consistent with existing law and essential economic and 
strategic factors.



PART 332--VOLUNTARY AGREEMENTS UNDER SECTION 708 OF THE DEFENSE PRODUCTION ACT OF 1950, AS AMENDED--Table of Contents




Sec.
332.1  General provisions.
332.2  Developing voluntary agreements.
332.3  Carrying out voluntary agreements.
332.4  Termination or modifying voluntary agreements.
332.5  Public access to records and meetings.

    Authority: Sec. 708, Defense Production Act of 1950, as amended (50 
U.S.C. app. 2158); E.O. 10480, 3 CFR, 1949-1953 Comp., p. 961, as 
amended; E.O. 12148, 44 FR 43239.

    Source: 46 FR 2350, Jan. 9, 1981, unless otherwise noted.



Sec. 332.1  General provisions.

    (a) Pursuant to section 708 of the Defense Production Act of 1950, 
as amended (50 U.S.C. App. 2158), the President may consult with 
representatives of industry, business, financing, agriculture, labor, or 
other interests, and may approve the making of voluntary agreements to 
help provide for the defense of the United States by developing 
preparedness programs and expanding productive capacity and supply 
beyond levels needed to meet essential civilian demand.
    (b) Sponsor. (1) As used in this part, ``sponsor'' of a voluntary 
agreement is an officer of the Government who, pursuant to a delegation 
or redelegation of the functions given to the President by section 708 
of the Defense Production

[[Page 574]]

Act (DPA) of 1950, as amended, proposes or otherwise provides for the 
development or carrying out of a voluntary agreement.
    (2) The use of voluntary agreements, as authorized by section 708 of 
the DPA to help provide for the defense of the United States through the 
development of preparedness programs, is an activity coordinated by the 
Director of the Federal Emergency Management Agency, as provided by 
sections 101 and 501(a) of Executive Order 10480, as amended.
    (3) The sponsor of a voluntary agreement shall carry out sponsorship 
functions subject to the direction and control of the Director of the 
Federal Emergency Management Agency.
    (c) This part applies to the development and carrying out under 
section 708 of the DPA, as amended, of all voluntary agreements, and the 
carrying out of any voluntary agreement which was entered into under 
former section 708 of the DPA and in effect immediately prior to April 
14, 1976, and which is in a period of extension as authorized by 
subsection 708(f)(2) of the DPA.
    (d) The rules in the part void any provision of a voluntary 
agreement to which they apply, if that provision is contrary to or 
inconsistent with them. Each voluntary agreement shall be construed as 
containing every substantive provision that these rules require, whether 
or not a particular provision is included in the agreement.
    (e) Pursuant to subsection 708(d) of the DPA, the sponsor may 
establish such advisory committees as he deems to be necessary for 
developing or carrying out voluntary agreements. Such advisory 
committees shall comply with this part as well as with the requirements 
and procedures of the Federal Advisory Committee Act (Pub. L. 92-463, as 
amended).



Sec. 332.2  Developing voluntary agreements.

    (a) Purpose and scope. This section establishes the standards and 
procedures by which voluntary agreements may be developed through 
consultation, pursuant to subsection 708(c) of the DPA.
    (b) Proposal to develop an agreement. (1) A sponsor who wishes to 
develop a voluntary agreement shall submit to the Attorney General and 
the Director of the Federal Emergency Management Agency a document 
proposing the agreement. The proposal will include statements as to: The 
purpose of the agreement; the factual basis for making the finding 
required in subsection 708(c)(1) of the DPA; the proposed participants 
in the agreement; and any coordination with other Federal agencies 
accomplished in connection with the proposal.
    (2) If the Attorney General, after consultation with the Chairman of 
the Federal Trade Commission, approves this proposal, the sponsor shall 
then initiate one or more meetings of interested persons to develop the 
agreement.
    (c) Conduct of meetings held to develop the agreement. (1) The 
sponsor shall give to the Attorney General, the Chairman of the Federal 
Trade Commission, and the Director of the Federal Emergency Management 
Agency adequate written notice of each meeting to develop a voluntary 
agreement. The sponsor shall also publish in the Federal Register notice 
of the time, place, and nature of each meeting at least seven days prior 
to the meeting.
    (2) The sponsor shall chair each meeting held to develop a voluntary 
agreement. Both the Attorney General and the Chairman of the Federal 
Trade Commission, or their delegates, shall attend each of these 
meetings.
    (3) Any interested person may attend a meeting held to develop a 
voluntary agreement, unless the sponsor of the agreement limits 
attendance pursuant to Sec. 332.5 of this part.
    (4) Any interested person may, as set out in the Federal Register 
meeting notice, submit written data and views concerning the proposed 
voluntary agreement, and at the discretion of the Chairman of the 
meeting, may be given the opportunity for oral presentation.
    (d) Maintenance of records. (1) The sponsor is responsible for the 
making of a full and verbatim transcript of each meeting. The Chairman 
shall send this transcript, and any voluntary agreement resulting from 
the meeting, to the Attorney General, the Chairman of the Federal Trade 
Commission, the Director of the Federal Emergency

[[Page 575]]

Management Agency, and any other party or repository required by law.
    (2) The sponsor of a voluntary agreement shall maintain each meeting 
transcript and voluntary agreement, and make them available for public 
inspection and copying the extent required by Sec. 332.5 of this part.
    (e) Effectiveness of agreements. The following steps must occur 
before a new voluntary agreement or an extension of an existing 
agreement may become effective:
    (1) The sponsor must approve the agreement and certify in writing 
that it is necessary to carry out the purposes of subsection 708(c)(1) 
of the DPA;
    (2) The Director of the Federal Emergency Management Agency must 
approve this certification, and submit it to the Attorney General with a 
request for a written finding; and
    (3) The Attorney General, after consulting with the Chairman of the 
Federal Trade Commission, must issue a written finding that the purposes 
of subsection 708(c)(1) can not reasonably be achieved through a 
voluntary agreement having less anti-competitive effects or without any 
voluntary agreement.



Sec. 332.3  Carrying out voluntary agreements.

    (a) Purpose and scope. This section establishes the standards and 
procedures by which the participants in each approved voluntary 
agreement shall carry out the agreement.
    (b) Participants. The participants in each voluntary agreement shall 
be reasonably representative of the appropriate industry or segment of 
that industry.
    (c) Conduct of meetings held to carry out an agreement. (1) The 
sponsor of a voluntary agreement shall initiate, or approve in advance, 
each meeting of the participants in the agreement held to discuss 
problems, determine policies, recommend actions, and make decisions 
necessary to carry out the agreement.
    (2) The sponsor shall provide to the Attorney General, the Chairman 
of the Federal Trade Commission, and the Director of the Federal 
Emergency Management Agency adequate prior notice of the time, place, 
and nature of each meeting, and a proposed agenda of each meeting. The 
sponsor shall also publish in the Federal Register, reasonably in 
advance of each meeting, a notice of time, place, and nature of the 
meeting. If the sponsor has determined, pursuant to Sec. 332.5 of this 
part, to limit attendance at the meeting, the sponsor shall publish this 
Federal Register notice within ten days of the meeting.
    (3) Any interested person may attend a meeting held to carry out a 
voluntary agreement unless the sponsor has restricted attendance 
pursuant to Sec. 332.5 of this part. A person attending a meeting under 
this section may present oral or written data, views, and arguments to 
any limitations on the manner of presentation that the sponsor may 
impose.
    (4) No meeting shall be held to carry out any voluntary agreement 
unless a Federal employee, other than an individual employed pursuant to 
5 U.S.C. 3109, is in attendance. Any meeting to carry out a voluntary 
agreement may be attended by the sponsor of the agreement, the Attorney 
General, the Chairman of the Federal Trade Commission, the Director of 
the Federal Emergency Management Agency, or their delegates.
    (5) Notwithstanding any other provision of this section, a meeting 
between a single participant and the sponsor solely to deliver or 
exchange information is not subject to the requirements and procedures 
of this section, provided that a copy of the information is promptly 
delivered to the Attorney General, the Chairman of the Federal Trade 
Commission, and the Director of the Federal Emergency Management Agency.
    (d) Maintenance of records. (1) The participants in any voluntary 
agreement shall maintain for five years all minutes of meetings, 
transcripts, records, documents, and other data, including any 
communications among themselves or with any other member of their 
industry, related to the carrying out of the voluntary agreement. The 
participants shall agree, in writing, to make available to the sponsor, 
the Attorney General, the Chairman of the Federal Trade Commission and 
the Director of the Federal Emergency

[[Page 576]]

Management Agency for inspection and copying at reasonable times and 
upon reasonable notice any item that this section requires them to 
maintain.
    (2) Any person required by this paragraph to maintain records shall 
indicate specific portions, if any, that such person believes should not 
be disclosed to the public pursuant to Sec. 332.5 of this part, and the 
reasons therefor. Any item made available to a Government official named 
in this paragraph shall be available from that official for public 
inspection and copying to the extent set forth in Sec. 332.5 of this 
part.



Sec. 332.4  Termination or modifying voluntary agreements.

    The Attorney General may terminate or modify a voluntary agreement, 
in writing, after consultation with the Chairman of the Federal Trade 
Commission and the sponsor of the agreement. The sponsor of the 
agreement, with the concurrence of or at the direction of the Director 
of the Federal Emergency Management Agency, may terminate or modify a 
voluntary agreement, in writing, after consultation with the Attorney 
General and the Chairman of the Federal Trade Commission. Any person who 
is a party to a voluntary agreement may terminate his participation in 
the agreement upon written notice to the sponsor. Any antitrust immunity 
conferred upon the participants in that agreement by subsection 708(j) 
of the DPA shall not apply to any act or omission occurring after the 
termination of the voluntary agreement. Immediately upon modification of 
a voluntary agreement, no antitrust immunity shall apply to any 
subsequent act or omission that is beyond the scope of the modified 
agreement.



Sec. 332.5  Public access to records and meetings.

    (a) Interested persons may, pursuant to 5 U.S.C. 552, inspect or 
copy any voluntary agreement, minutes of meetings, transcripts, records, 
or other data maintained pursuant to these rules.
    (b) Except as provided by paragraph (c) of this section, interested 
persons may attend any part of a meeting held to develop or carry out a 
voluntary agreement pursuant to these rules.
    (c) The sponsor of a voluntary agreement may withhold material 
described in this section from disclosure and restrict attendance at 
meetings only on the grounds specified in:
    (1) Section 552(b)(1) of 5 U.S.C., which applies to matter 
specifically required by Executive Order to be kept secret in the 
interest of the national defense or foreign policy. This section shall 
be interpreted to included matter protected under Executive Order 12065, 
dated June 28, 1978 (3 CFR 1979-1975 Comp. p. 678), establishing 
categories and criteria for classification; and
    (2) Section 552(b)(3) of 5 U.S.C., which applies to matter 
specifically exempted from disclosure by statute; and
    (3) Section 552(b)(4) of 5 U.S.C., which applies to trade secrets 
and commercial or financial information obtained from a person as 
privileged and confidential.



PART 333--PEACETIME SCREENING--Table of Contents




Sec.
333.1  Purpose.
333.2  Scope and applicability.
333.3  Policy.
333.4  Procedures.
333.5  Responsibilities.

    Authority: 50 U.S.C. 404; 50 U.S.C. app. 2061 et seq.; E.O. 12148; 
E.O. 11190, as amended by E.O. 11382.

    Source: 47 FR 7240, Feb. 18, 1982, unless otherwise noted.



Sec. 333.1  Purpose.

    To provide procedures for eliminating conflict between key civil 
employment and military assignment of Ready Reservists in the event of a 
mobilization of the Ready Reserve.



Sec. 333.2  Scope and applicability.

    (a) Employees are responsible for informing employers of their 
reserve status. If mobilization is directed, procedures in Sec. 333.4(e) 
will terminate and all members of the Ready Reserve will be subject to 
mobilization.
    (b) Employers in State and local governments and private industry 
should identify and inform the Department of Defense of those reservists 
who continue to occupy key positions in their organizations after other 
remedies to

[[Page 577]]

staff these positions with non-reserve personnel are inappropriate.

[47 FR 7240, Feb. 18, 1982, as amended at 51 FR 34606, Sept. 30, 1986]



Sec. 333.3  Policy.

    (a) Ready Reservists will be called into active military service in 
a national emergency. No deferment from mobilization will be granted 
because of civil employment.
    (b) The Federal Emergency Management Agency and the Department of 
Defense recognize that a potential for conflict between military and 
civil employment could exist for Ready Reservists. They have agreed to 
consider changing a reservist's assignment if they are essential civil 
employees. This change in status could only be made prior to a 
mobilization.
    (c) It is in the interest of employers that key positions held by 
Ready Reservists be screened and appropriate steps be taken to correct 
military and civil assignments.



Sec. 333.4  Procedures.

    Prior to a mobilization, State and local governments, and private 
industry may identify all key employees who are members of the Ready 
Reserve, assess impact on their organization of a call-up of Reservists, 
and use the following procedures as appropriate:
    (a) Prepare other employees to assume the essential functions of 
Ready Reservists.
    (b) Transfer the essential functions of Ready Reservists to other 
employees.
    (c) Develop plans to fill positions vacated by Ready Reservists in a 
mobilization.
    (d) Make other arrangements to have the essential functions of Ready 
Reservists performed.
    (e) If these remedies are not appropriate, these organizations can 
use the criteria and procedures in Department of Defense Regulation 32 
CFR part 44 on a case-by-case basis to request that particular key 
employees be screened out of the Ready Reserve.



Sec. 333.5  Responsibilities.

    (a) Employers of Ready Reservists may notify the Armed Forces in 
order to determine if potential conflicts affecting their employees 
between military or civil duties warrant change in Ready Reserve status. 
The Department of Labor, through appropriate national and regional 
offices, will be available to advise State and local government and 
private industry in support of a mobilization and assist such entities 
in substantiating their claims for essential civil positions.
    (b) The Department of Defense may advise civilian employers of Ready 
Reservists of their employees' Ready Reserve status, including name, 
social security number, and other data necessary to identify Ready 
Reserve employees.
    (c) In all cases, 32 CFR part 44 procedures shall pertain. If an 
organization's request for exemption from military duties is denied by 
DOD and should continued conflict between DOD and employers persist on 
essential civil employment, on the basis of criteria adopted jointly by 
the Departments of Commerce, Defense, and Labor and the Federal 
Emergency Management Agency, then FEMA shall adjudicate the differences.



PART 334--GRADUATED MOBILIZATION RESPONSE--Table of Contents




Sec.
334.1  Purpose.
334.2  Policy.
334.3  Background.
334.4  Definitions.
334.5  GMR system description.
334.6  Department and agency responsibilities.
334.7  Reporting.

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq; 
E.O. 12148 of July 20, 1979, 3 CFR, 1979 Comp., p. 412; E.O. 10480 of 
Aug. 14, 1953, 3 CFR, 1949-53 Comp., p. 962; E.O. 12472 of Apr. 3, 1984; 
3 CFR, 1984 Comp., p. 193; E.O. 12656 of Nov. 18, 1988, 53 FR 47491.

    Source: 55 FR 1821, Jan. 19, 1990, unless otherwise noted.



Sec. 334.1  Purpose.

    (a) Provides policy guidance pursuant to the Defense Production Act 
of 1950, as amended; section 1-103 of Executive Order 12148, as amended, 
which includes functions continued from E.O. 11051; section 104(f) of 
Executive Order

[[Page 578]]

12656; and part 2 of Executive Order 10480.
    (b) Establishes a Graduated Mobilization Response (GMR) system for 
developing and implementing mobilization actions that are responsive to 
a wide range of national security threats and ambiguous or specific 
warning indicators. GMR provides for a coherent decision making process 
with which to proceed with specific responses to an identified crisis or 
emergency.
    (c) Provides guidance to the federal departments and agencies for 
developing plans that are responsive to a GMR system and for preparing 
costed option packages, as appropriate, to implement the plans.



Sec. 334.2  Policy.

    (a) As established in Executive Order 12656, the policy of the 
United States is to have sufficient emergency response capabilities at 
all levels of government to meet essential defense and civilian needs 
during any national security emergency. Accordingly, each federal 
department and agency shall prepare its national security emergency 
preparedness plans and programs to respond adequately and in a timely 
manner to all national security emergencies.
    (b) As part of emergency response, the GMR system should be 
incorporated in each department's and agency's emergency preparedness 
plans and programs to provide appropriate and effective response options 
for consideration in reacting to ambiguous and specific warnings.
    (c) Departments and agencies will be provided early warning 
information developed by the intelligence community and policy 
statements of the President.
    (d) Emergency resource preparedness planning is essential to ensure 
that the nation is adequately prepared to respond to potential national 
emergencies. Such emergency resource preparedness planning requires an 
exchange of information and planning factors among the various 
departments and agencies responsible for different resource preparedness 
actitivies.
    (e) To carry out their emergency planning activities, civilian 
departments and agencies require the Department of Defense's (DOD) 
assessment of potential military demands that would be made on the 
economy in a full range of possible national security emergencies. 
Similarly, DOD planning should be conducted using planning regimes 
consistent with the policies and plans of the civilian resource 
departments and agencies.
    (f) Under section 104(c) of Executive Order 12656, FEMA is 
responsible for coordinating the implementation of national emergency 
preparedness policy with federal departments and agencies and with state 
and local governments and, therefore, is responsible for developing a 
system of planning procedures for integrating the emergency preparedness 
actions of federal, state and local governments.
    (g) Federal departments and agencies shall design their preparedness 
measures to permit a rapid and effective transition from routine to 
emergency operations, and to make effective use of the period following 
initial indication of a probable national security emergency. This will 
include:
    (1) Development of a system of emergency actions that defines 
alternatives, processes, and issues to be considered during various 
stages of national security emergencies; and
    (2) Identification of actions that could be taken at the federal and 
local levels of government in the early stages of a national security 
emergency or pending national security emergency to mitigate the impact 
of or reduce significantly the leadtime associated with full emergency 
action implementation.



Sec. 334.3  Background.

    (a) The GMR system is designed to take into account the need to 
mobilize the Nation's resources in response to a wide range of crisis or 
emergency situations. GMR is a flexible decision making process of 
preparedness and response actions which are appropriate to warning 
indicators or an event. Thus, GMR allows the government, as a whole, to 
take small or large, often reversible, steps to increase its national 
security emergency preparedness posture.
    (b) Crises, especially those resulting in major military activities, 
always

[[Page 579]]

have some political or economic context. As the risks of military action 
increase, nations undertake more extensive preparations over a longer 
perod of time to increase their military power. Such preparations by 
potential adversaries shape the nature and gravity of the threat as well 
as its likelihood and timing of occurrence. These measures permit the 
development of reliable indicators of threat at an early time in the 
evolution of a crisis. Depending on the nature of the situation or event 
and the nation involved, these early warning indicators may emanate from 
the political, socio-economic and/or industrial sectors.
    (c) The GMR system enables the nation to approach mobilization 
planning and actions as part of the deterrent response capability and to 
use it to reduce the probability of conflict. Alternatively, if 
deterrence should fail, the GMR system would enable the nation to 
undertake a series of phased actions intended to increase its ability to 
meet defense and essential civilian requirements. The GMR system 
integrates the potential strength of the national economy into U.S. 
national security strategy.



Sec. 334.4  Definitions.

    (a) Graduated Mobilization Response (GMR) is a system for 
integrating mobilization actions designed to respond to ambiguous and/or 
specific warnings. These actions are designed to mitigate the impact of 
an event or crisis and reduce significantly the lead time associated 
with a full national emergency action implementation.
    (b) National security emergency is any occurrence, including natural 
disaster, military attack, technological emergency, or other emergency, 
that seriously degrades or threatens the national security of the United 
States.
    (c) Mobilization is the process of marshalling resources, both civil 
and military, to respond to and manage a national security emergency.
    (d) GMR Plans are those agency documents that describe, in general, 
the actions that an agency could take in the early stages of a national 
security emergency, or upon receipt of warning information about a 
possible national security emergency. These actions would be designed to 
mitigate the impact of, or reduce significantly, the lead times 
associated with full emergency action implementation. Such plans are 
required by section 201(4)(b) of Executive Order 12656.
    (e) A Costed Option Package is a document that describes in detail a 
particular action that an agency could take in the early stages of a 
national security emergency. The general content of a GMR costed option 
package includes alternative response options; the resource implications 
of each option; shortfalls, costs, timeframes and political feasibility.



Sec. 334.5  GMR system description.

    The GMR system contains three stages of mobilization activity 
(additional intermediate GMR stages may be developed). For example, a 
federal department or agency might divide ``Crisis Management'' into 
two, three, or more levels as suits its needs.
    (a) Stage 3, Planning and Preparation. During the planning and 
preparation stage, federal departments and agencies develop their GMR 
plans and maintain capability to carry out their mobilization-related 
responsibilities in accordance with section 201 of Executive Order 
12656. General types of problems likely to arise in a crisis situation 
are identified along with possible methods for dealing with them. 
Investment programs can be undertaken to overcome identified problems.
    (b) Stage 2, Crisis Management. During the crisis management stage, 
GMR plans are reviewed and capabilities will be re-examined in light of 
an actual event or crisis perceived to be emerging.
    (1) Federal departments and agencies may need to gather additional 
data on selected resources or increase their preparedness activities. 
Costed Option Packages may need to be updated or new ones prepared for 
the response option measures in each of the department's and agency's 
area of responsibility. For example, when it appears likely that 
increased national resources may be required, resource readiness could 
be improved through the procurement of essential long lead time items, 
especially those that can be used even if the situation does not

[[Page 580]]

escalate. In general, long lead time preparedness actions would be 
considered for implementation at this time.
    (2) Many preparedness actions at this stage would be handled through 
reprogramming, but the Costed Option Packages may also require new 
funding.
    (3) If the crisis worsens, and prior to the declaration of national 
emergency, it may be necessary to surge certain production and stockpile 
items for future use.
    (c) Stage 1, National Emergency/War. During a national emergency or 
declaration of war, mobilization of all national resources escalates and 
GMR will be subsumed into the overall mobilization effort. As military 
requirements increase, the national resources would increasingly be 
focused on the national security emergency. This would involve diverting 
non-essential demand for scarce resources from peacetime to defense 
uses, and converting industry from commercial to military production. 
Both surge production and expansion of the nation's productive capacity 
may also be necessary. Supplemental appropriations may be required for 
most Federal departments and agencies having national security emergency 
responsibilities.



Sec. 334.6  Department and agency responsibilities.

    (a) During Stage 3, each Federal department and agency with 
mobilization responsibilities will develop GMR plans as part of its 
emergency preparedness planning process in order to meet possible future 
crisis. Costed Option Packages will be developed for actions that may be 
necessary in the early warning period. Option packages will be reviewed, 
focused and refined during Stage 2 to meet the particular emergency.
    (b) Each department and agency should identify response actions 
appropriate for the early stage of any crisis or emergency situation, 
which then will be reviewed, focused and refined in Stage 2 for 
execution, as appropriate. GMR plans should contain a menu of costed 
option packages that provide details of alternative measures that may be 
used in an emergency situation.
    (c) FEMA will provide guidance pursuant to Executive Order 12656 and 
will coordinate GMR plans and option packages of DOD and the civilian 
departments and agencies to ensure consistency and to identify areas 
where additional planning or investment is needed.
    (d) During State 2, FEMA will coordinate department and agency 
recommendations for action and forward them to the National Security 
Advisor to make certain that consistency with the overall national 
strategy planning is achieved.
    (e) Departments and agencies will refine their GMR plans to focus on 
the specific crisis situation. Costed option packages should be refined 
to identify the resources necessary for the current crisis, action taken 
to obtain those resources, and GMR plans implemented consistent with the 
seriousness of the crisis.
    (f) At Stage 1, declaration of national emergency or war, the crisis 
is under the control of NSC or other central authority, with GMR being 
integrated into partial, full or total mobilization. At this point the 
more traditional mechanisms of resource mobilization are pursued, 
focusing on resource allocation and adjudication with cognizance of the 
essential civilian demand.
    (g) Programs and plans developed by the departments and agencies 
under this guidance should be shared, as appropriate, with States, local 
governments and the private sector to provide a baseline for their 
development of supporting programs and plans.



Sec. 334.7  Reporting.

    The Director of FEMA shall provide the President with periodic 
assessments of the Federal departments and agencies capabilities to 
respond to national security emergencies and periodic reports to the 
National Security Council on the implementation of the national security 
emergency preparedness policy. Pursuant to section 201(15) of Executive 
Order 12656, departments and agencies, as appropriate, shall consult and 
coordinate with the Director of FEMA to ensure that their activities and 
plans are consistent with current National Security Council guidelines

[[Page 581]]

and policies. An evaluation of the Federal departments and agencies 
participation in the graduated mobilization response program may be 
included in these reports.



PART 335  [RESERVED]






PART 336--PREDESIGNATION OF NONINDUSTRIAL FACILITIES (NIF) FOR NATIONAL SECURITY EMERGENCY USE--Table of Contents




Sec.
336.1  Purpose.
336.2  Applicability and scope.
336.3  Reference.
336.4  Definitions.
336.5  Background.
336.6  Policy.
336.7  Federal responsibilities.
336.8  State and local Government emergency planning agencies.
336.9  Reporting.

    Authority: National Security Act of 1947, as amended, 50 U.S.C. 404; 
Defense Production Act of 1950, as amended, 50 U.S.C. app. 2061 et seq.; 
E.O. 12148 of July 20, 1979, 3 CFR, 1979 Comp., p. 412; E.O. 10480 of 
Aug. 14, 1953, 3 CFR, 1949-53 Comp., p. 962; and E.O. 12656 of Nov. 18, 
1988, 53 FR 47491.

    Source: 55 FR 30458, July 26, 1990, unless otherwise noted.



Sec. 336.1  Purpose.

    (a) This part establishes policy and procedural guidance to assist 
the Federal departments and agencies in the development of plans for the 
predesignation and assignment of nonindustrial facilities to ensure that 
emergency requirements can be met in time of a national security 
emergency.
    (b) Specifically, this part provides:
    (1) Policy guidance for the predesignation of nonindustrial 
facilities for essential needs in a national security emergency.
    (2) Criteria guidance for the Federal departments and agencies to 
assess and select on a priority basis the nonindustrial facilities that 
are needed for national security emergencies.
    (3) Planning guidance for the Federal departments and agencies to 
develop plans and programs for the usage of nonindustrial facilities and 
avoid or minimize disruptions of essential services during any national 
security emergency.



Sec. 336.2  Applicability and scope.

    This part is applicable to all Federal departments and agencies, 
State and local governments and the private sector and provides policy 
and procedural guidance for carrying out the NIF program. The NIF 
program helps ensure our ability to mobilize essential nonindustrial 
facilities for Department of Defense (DOD) and essential civilian needs 
in the event of a national security emergency or contingency.



Sec. 336.3  Reference.

    Department of Defense Directive 4165.6, Real Property Acquisition 
Management and Disposal, dated September 1, 1987, which may be obtained 
from Headquarters, U. S. Forces Command, Fort McPherson, Georgia 30330-
6000, Attn: FCEN-CDP.



Sec. 336.4  Definitions.

    (a) Agency. Agency refers to all of the Federal departments and 
agencies and the State and local entities participating in the NIF 
program to predesignate nonindustrial facilities.
    (b) Allocation. Allocation means the NIF predesignation has been 
granted to the requesting organization.
    (c) Denial. Denial means that predesignation of a NIF was not 
allocated due to a conflict between Federal or State NIF requests.
    (d) Graduated Mobilization Response is a system for integrating 
mobilization actions designed to respond to ambiguous and/or specific 
warnings. These actions are designed to mitigate the impact of an event 
or crisis and reduce significantly the lead time associated with a full 
national emergency action implementation.
    (e) National security emergency. A national security emergency is 
any occurrence, including natural disaster, military attack, 
technological emergency, or other emergency, that seriously degrades or 
seriously threatens the national security of the United States.
    (f) Nonindustrial Facility. Nonindustrial Facility refers to a unit 
of real property that can be used for housing, training or another non-
industrial purpose; for example hotels, motels, educational 
institutions, office buildings, and other real estate (excluding farms,

[[Page 582]]

churches or other places of worship, or private dwelling houses).
    (g) Predesignation. Predesignation means the advanced identification 
and screening of a NIF to help ensure there will be no conflict of 
requirements for its use during a national security emergency.

[55 FR 30458, July 26, 1990, as amended at 55 FR 34262, Aug. 22, 1990]



Sec. 336.5  Background.

    (a) The purpose of the NIF program is to improve the Nation's 
ability to mobilize nonindustrial facilities for DOD and/or essential 
civilian needs in times of national security emergencies.
    (b) Availability of adequate nonindustrial facilities can be crucial 
in responding decisively and effectively to emergency situations. In 
planning for a mobilization surge, military commanders have found 
existing military housing and training facilities are not adequate to 
meet the demand of mission requirements. To meet these requirements, 
access to other nonindustrial facilities has been sought through standby 
agreements or contracts with the owners and operators of nonindustrial 
facilities to supplement government installations.
    (c) Although NIF is principally a Department of Defense program, 
other Federal departments and agencies and State and local agencies may 
also have nonindustrial facilities requirements.
    (d) Executive Order 12656 directs Federal departments and agencies 
to prepare national plans and programs such as NIF, to ensure an 
appropriate state of readiness to respond to a national security 
emergency.
    (e) In the development of the plans for use of these facilities, 
including privately-owned facilities, different requirements for 
national security emergencies must be considered. Such emergency 
conditions could create a conflicting requirement for the same facility 
by Government entities. FEMA will coordinate the NIF requests by DoD 
components and other Federal agencies with the appropriate State 
agencies to ensure that conflicts between civilian and military 
requirements are avoided.

[55 FR 30458, July 26, 1990, as amended at 55 FR 34262, Aug. 22, 1990]



Sec. 336.6  Policy.

    (a) The policy of the United States is to have sufficient emergency 
response capabilities at all levels of government to meet essential 
defense and civilian needs during any national security emergency. 
Accordingly, each Federal Department and agency shall enhance its 
emergency preparedness response capabilities and plans through the use 
of nonindustrial facilities in national security emergencies.
    (b) Federal Departments and agencies will determine their 
requirements for nonindustrial facilities and shall identify the 
specific facilities needed to meet these emergency requirements.
    (c) Federal Departments and agencies will develop their 
nonindustrial facilities requirements and planning in conformance with 
Stage 3 of the Graduated Mobilization Response System to provide 
appropriate and effective response options for consideration in reacting 
to a national security emergency.
    (d) Federal Departments and agencies will develop contingency plans 
to utilize these facilities in an emergency in order to minimize 
response time and costs for utilization or construction of additional 
nonindustrial facilities.
    (e) Utilizing national priorities established in consultation with 
the National Security Advisor, FEMA will resolve competing requests for 
nonindustrial facilities usage in national security emergencies. 
Competing requests that cannot be resolved by FEMA may be resolved 
through referral to the National Security Advisor.



Sec. 336.7  Federal responsibilities.

    (a) Departments and Agencies. The heads of Federal departments and 
agencies are responsible for:
    (1) Meeting their emergency preparedness facilities requirements by 
developing programs for the selection and predesignation of 
nonindustrial facilities;
    (2) Assessing essential emergency requirements and plans for the use 
of alternative nonindustrial facilities to meet critical demands during 
and following national security emergencies;
    (3) Submitting the NIF requests to the FEMA Regional Director in the

[[Page 583]]

area where the facility is located. Copies of the applications and 
instructions may be obtained by writing the appropriate FEMA regional 
office listed in Appendix A to this part.
    (4) Making the necessary arrangements with the owners and operators 
of the predesignated nonindustrial facility to permit a rapid and 
effective transition from routine to emergency operations and the 
effective use of nonindustrial facilities in emergency operations.
    (5) Notifying the appropriate FEMA regional office that the 
necessary arrangements with the owners and operators for the use of 
nonindustrial facilities have been completed.
    (b) The Federal Emergency Management Agency (FEMA). The Director of 
the FEMA or designee, shall:
    (1) Convey national security emergency preparedness policies of the 
National Security Council and provide planning guidance and assistance 
to the Federal departments and agencies;
    (2) Coordinate emergency planning programs and national security 
emergency preparedness activities of the Federal Government, including 
the NIF Program;
    (3) Provide procedures and guidance for coordinating the 
predesignation of nonindustrial facilities;
    (4) Resolve conflicting NIF requests that cannot be resolved at the 
regional office level and refer appropriate issues to the National 
Security Advisor for resolution;
    (c) The FEMA Regional Directors shall: (1) Advise and assist State 
and local governments and, as appropriate, private organizations on the 
NIF program.
    (2) Seek clearance with appropriate State authorities on 
nonindustrial facilities selected for Federal use in their States.
    (3) Coordinate arrangements between Federal departments and 
agencies; and with State authorities on facility predesignation and 
allocation.
    (4) Consider the multi-use of predesignated facilities based on 
competing requirements for the same facility, unless single use is 
necessary or appropriate for the national defense.
    (5) Forward to FEMA Headquarters competing NIF requests that cannot 
be resolved at the regional level.
    (6) Provide the appropriate State emergency planning agencies with a 
copy of a periodic report of Predesignated Nonindustrial Facilities for 
their particular region.

[55 FR 30459, July 26, 1990, as amended at 55 FR 34262, Aug. 22, 1990]



Sec. 336.8  State and local Government emergency planning agencies.

    (a) State and local emergency planning agencies have a crucial role 
to play in achieving a coordinated program to predesignate nonindustrial 
facilities to meet emergency requirements. Consequently, it is essential 
that precise plans are developed for the conditions under which each 
facility is to be used in order to provide efficient and effective means 
to accommodate civilian and military requirements in accessing 
nonindustrial facilities in the event of a national security emergency, 
to avoid conflicting requirements between Federal, and State and local 
agencies.
    (b) In response to requests for clearance by FEMA regional offices 
of designations of nonindustrial facilities by Federal departments and 
agencies, the appropriate State agency will review the request and 
provide an appropriate reply.



Sec. 336.9  Reporting.

    The Director of FEMA may provide the President with periodic 
assessments of the Federal departments and agencies capability to 
respond to national security emergencies. Pursuant to section 201(15) of 
Executive Order 12656, departments and agencies, as appropriate, shall 
consult and coordinate with the Director of FEMA to ensure that their 
activities and plans are consistent with current National Security 
Council guidelines and policies. An evaluation of the programs of 
Federal departments and agencies to predesignate nonindustrial 
facilities may be included in this report.

                    Appendix A--FEMA Regional Offices

    The addresses for the regional office contacts for FEMA Region I 
through X are as follows:

[[Page 584]]

FEMA Region I, Chief, Emergency Management and National Preparedness, 
Programs Division, J.W. McCormack Post Office and Courthouse Building, 
Room 442, Boston, MA 02109
FEMA Region II, Chief, Emergency Management and National Preparedness 
Division, 26 Federal Plaza, Room 1338, New York, NY 10278
FEMA Region III, Chief, Emergency Management and National Preparedness, 
Liberty Square Building (Second Floor), 105 South Seventh Street, 
Philadelphia, PA 19106
FEMA Region IV, Chief, Emergency Management and National Preparedness 
Division, 1371 Peachtree Street, N.E., Suite 700, Atlanta, GA 30309
FEMA Region V, Chief, Emergency Management and National Preparedness 
Division, 175 West Jackson Blvd., 4th Floor, Chicago, IL 60604-2698
FEMA Region VI, Chief, Emergency Management and National Preparedness 
Division, Federal Regional Center, 800 N. Loop 288, Denton, TX 76201-
3698
FEMA Region VII, Chief, Emergency Management and National Preparedness 
Division, 911 Walnut Street, Room 200, Kansas City, MO 64106
FEMA Region VIII, Chief, Emergency Management and National Preparedness 
Division, Denver Federal Center, Building 710, Box 25267, Denver, CO 
80225-0267
FEMA Region IX, Chief, Emergency Management and National Preparedness 
Division, Building 105, Presidio of San Francisco, CA 94129
FEMA Region X, Chief, Emergency Management and National Preparedness 
Division, 130 228th Street, Southwest, Federal Regional Center, Bothell, 
WA 98021-9796



PARTS 337-349  [RESERVED]






PART 350--REVIEW AND APPROVAL OF STATE AND LOCAL RADIOLOGICAL EMERGENCY PLANS AND PREPAREDNESS--Table of Contents




Sec.
350.1  Purpose.
350.2  Definitions.
350.3  Background.
350.4  Exclusions.
350.5  Criteria for review and approval of State and local radiological 
          emergency plans and preparedness.
350.6  Assistance in development of State and local plans.
350.7  Application by State for review and approval.
350.8  Initial FEMA action on State plan.
350.9  Exercises.
350.10  Public meeting in advance of FEMA approval.
350.11  Action by FEMA Regional Director.
350.12  FEMA Headquarters review and approval.
350.13  Withdrawal of approval.
350.14  Amendment to State plans.
350.15  Appeal procedures.

    Authority: 42 U.S.C. 5131, 5201, 50 U.S.C. app. 2253(g); Sec. 109 
Pub. L. 96-295; Reorganization Plan No. 3 of 1978; E.O. 12127; E.O. 
12148.

    Source: 48 FR 44335, Sept. 28, 1983, unless otherwise noted.



Sec. 350.1  Purpose.

    The purpose of the regulation in this part is to establish policy 
and procedures for review and approval by the Federal Emergency 
Management Agency (FEMA) of State and local emergency plans and 
preparedness for the offsite effects of a radiological emergency which 
may occur at a commercial nuclear power facility. Review and approval of 
these plans and preparedness involves preparation of findings and 
determinations of the adequacy of the plans and capabilities of State 
and local governments to effectively implement the plans.



Sec. 350.2  Definitions.

    As used in this part, the following terms are defined:
    (a) Director means the Director, FEMA, or designee;
    (b) Regional Director means a Regional Director of FEMA, or 
designee;
    (c) Associate Director means the Associate Director, State and Local 
Programs and Support, FEMA, or designee;
    (d) FEMA means the Federal Emergency Management Agency;
    (e) NRC means the Nuclear Regulatory Commission;
    (f) EPZ means Emergency Planning Zone.
    (g) Emergency Planning Zone (EPZ) is a generic area around a 
commercial nuclear facility used to assist in offsite emergency planning 
and the development of a significant response base. For commercial 
nuclear power plants, EPZs of about 10 and 50 miles are delineated for 
the plume and ingestion exposure pathways respectively.
    (h) Plume Exposure Pathway refers to whole body external exposure to 
gamma radiation from the plume and

[[Page 585]]

from deposited materials and inhalation exposure from the passing 
radioactive plume. The duration of primary exposures could range in 
length from hours to days.
    (i) Ingestion Exposure Pathway refers to exposure primarily from 
ingestion of water or foods such as milk and fresh vegetables that have 
been contaminated with radiation. The duration of primary exposure could 
range from hours to months.
    (j) Full participation refers to an exercise in which: (1) State and 
local government emergency personnel are engaged in sufficient numbers 
to verify the capability to respond to the actions required by the 
accident scenario; (2) the integrated capability to adequately assess 
and respond to an accident at a commercial nuclear power plant is 
tested; and (3) the implementation of the observable portions of State 
and/or local plans is tested.
    (k) Partial participation refers to the engagement of State and 
local government emergency personnel in an exercise sufficient to 
adequately test direction and control functions for protective action 
decisionmaking related to emergency action levels and communication 
capabilities among affected State and local governments and the 
licensee.
    (l) Remedial exercise is one that tests deficiencies of previous 
joint exercise that are considered significant enough to impact on the 
public health and safety.
    (m) Local government refers to boroughs, cities, counties, 
municipalities, parishes, towns, townships and other local jurisdictions 
within the plume exposure pathway EPZ when any of these entities has 
specific roles in emergency planning and preparedness in the EPZ.
    (n) Site refers to the location at which there is one or more 
commercial nuclear power plants. A nuclear power plant is synonymous 
with a nuclear power facility.



Sec. 350.3  Background.

    (a) On December 7, 1979, the President directed the Director of FEMA 
to take the lead in State and local emergency planning and preparedness 
activities with respect to nuclear power facilities. This included a 
review of the existing emergency plans both in States with operating 
reactors and those with plants scheduled for operation in the near 
future.
    (b) This assignment was given to FEMA because of its 
responsibilities under Executive Order 12148 to establish Federal 
policies for and coordinate civil emergency planning, management and 
assistance functions and to represent the President in working with 
State and local governments and the private sector to stimulate vigorous 
participation in civil emergency preparedness programs. Under section 
201 of the Disaster Relief Act of 1974 (42 U.S.C. 5131), and other 
statutory functions, the Director of FEMA is charged with the 
responsibility to develop and implement plans and programs of disaster 
preparedness.
    (c) There are two sections in the NRC's fiscal year 1982/1983 
Appropriation Authorization (Pub. L. 97-415) that pertain to the scope 
of this rule.
    (1) Section 5 provides for the issuance of an operating license for 
a commercial nuclear power plant by the NRC if it is determined that 
there exists a State, local or utility plan which provides assurance 
that public health and safety is not endangered by the operation of the 
facility. This section would allow the NRC to issue an operating license 
for such plants without FEMA-approved State and local government plans.
    (2) Section 11 provides for the issuance of temporary licenses for 
operating a utilization facility at a specific power level to be 
determined by the Commission, pending final action by the Commission on 
the application. Also, this section authorizes the NRC to issue 
temporary operating licenses for these facilities without the completion 
of the required (NRC) Commission hearing process. A petition for such a 
temporary license may not be filed until certain actions are completed 
including the submission of a State, local or utility emergency response 
plan for the facility.
    (d) To carry out these responsibilities, FEMA is engaged in a 
cooperative effort with State and local governments and other Federal 
agencies in the development of State and local plans and preparedness to 
cope with

[[Page 586]]

the offsite effects resulting from radiological emergencies at 
commercial nuclear power facilities. FEMA developed and published the 
Federal Radiological Emergency Response Plan 50 FR 46542 Nov. 8, 1985, 
to provide the overall support to State and local governments, for all 
types of radiological incidents including those occurring at nuclear 
power plants.
    (e) FEMA has entered into a Memorandum of Understanding (MOU) with 
the NRC to which it will furnish assessments, findings and 
determinations as to whether State and local emergency plans and 
preparedness are adequate and continue to be capable of implementation 
(e.g., adequacy and maintenance of procedures, training, resources, 
staffing levels and qualification and equipment adequacy). These 
findings and determinations will be used by NRC under its own rules in 
connection with its licensing and regulatory requirements and FEMA will 
support its findings in the NRC licensing process and related court 
proceedings.
    (f) Notwithstanding the procedures set forth in these rules for 
requesting and reaching a FEMA administrative approval of State and 
local plans, findings and determinations on the current status of 
emergency preparedness around particular sites may be requested by the 
NRC and provided by FEMA for use as needed in the NRC licensing process. 
These findings and determinations may be based upon plans currently 
available to FEMA or furnished to FEMA by the NRC through the NRC/FEMA 
Steering Committee.
    (g) An environmental assessment has been prepared on which FEMA has 
determined that this rule will not have a significant impact on the 
quality of the human environment.

[48 FR 44335, Sept. 28, 1983, as amended at 51 FR 34606, Sept. 30, 1986]



Sec. 350.4  Exclusions.

    The regulation in this part does not apply to, nor will FEMA apply 
any criteria with respect to, any evaluation, assessment or 
determination regarding the NRC licensee's emergency plans or 
preparedness, nor shall FEMA make any similar determination with respect 
to the integration of offsite and NRC licensee emergency preparedness 
except as these assessments and determinations affect the emergency 
preparedness of State and local governments. The regulation in this part 
applies only to State and local planning and preparedness with respect 
to emergencies at commercial nuclear power facilities and does not apply 
to other facilities which may be licensed by NRC, nor to United States 
Government-owned, non-licensed facilities nor the jurisdictions 
surrounding them.



Sec. 350.5  Criteria for review and approval of State and local radiological emergency plans and preparedness.

    (a) Section 50.47 of NRC's Emergency Planning Rule (10 CFR parts 50 
(appendix E) and 70 as amended) and the joint FEMA-NRC Criteria for 
Preparation and Evaluation of Radiological Emergency Response Plans and 
Preparedness in Support of Nuclear Power Plants (NUREG-0654/FEMA-REP-1, 
Rev. 1, November 1980) which apply insofar as FEMA is concerned to State 
and local governments, are to be used in reviewing, evaluating and 
approving State and local radiological emergency plans and preparedness 
and in making any findings and determinations with respect to the 
adequacy of the plans and the capabilities of State and local 
governments to implement them. Both the planning and preparedness 
standards and related criteria contained in NUREG-0654/ FEMA-REP-1, Rev. 
1 are to be used by FEMA and the NRC in reviewing and evaluating State 
and local government radiological emergency plans and preparedness. For 
brevity, only the planning standards contained in NUREG-0654/ FEMA-REP-
1, Rev. 1 are presented below.
    (1) Primary responsibilities for emergency response by the nuclear 
facility licensee, and by State and local organizations within the 
Emergency Planning Zones have been assigned, the emergency 
responsibilities of the various supporting organizations have been 
specifically established and each principal response organization has 
staff to respond to and augment its initial response on a continuous 
basis.
    (2) On-shift facility licensee responsibilities for emergency 
response are

[[Page 587]]

unambiguously defined, adequate staffing to provide initial facility 
accident response in key functional areas is maintained at all times, 
timely augmentation of response capabilities is available and the 
interfaces among various onsite response activities and offsite support 
and response activities are specified. (This standard applies only to 
NRC licensees but is included here for completeness.)
    (3) Arrangements for requesting and effectively using assistance 
resources have been made, arrangements to accommodate State and local 
staff at the licensee's near-site Emergency Operations Facility have 
been made and other organizations capable of augmenting the planned 
response have been identified.
    (4) A standard emergency classification and action level scheme, the 
bases of which include facility system and effluent parameters, is in 
use by the nuclear facility licensee, and State and local response plans 
call for reliance on information provided by facility licensees for 
determinations of minimum initial offsite response measures.
    (5) Procedures have been established for notification, by the 
licensee, of State and local response organizations and for the 
notification of emergency personnel by all response organizations; the 
content of initial and followup messages to response organizations and 
the public has been established; and means to provide early notification 
and clear instruction to the populace within the plume exposure pathway 
Emergency Planning Zone have been established.
    (6) Provisions exist for prompt communications among principal 
response organizations to emergency personnel and to the public.
    (7) Information is made available to the public on a periodic basis 
on how they will be notified and what their initial actions should be in 
an emergency (e.g., listening to a local broadcast station and remaining 
indoors), the principal points of contact with the news media for 
dissemination of information during an emergency (including the physical 
location or locations) are established in advance and procedures for 
coordinated dissemination of information to the public are established.
    (8) Adequate emergency facilities and equipment to support the 
emergency response are provided and maintained.
    (9) Adequate methods, systems and equipment for assessing and 
monitoring actual or potential offsite consequences of a radiological 
emergency condition are in use.
    (10) A range of protective actions has been developed for the plume 
exposure pathway EPZ for emergency workers and the public. Guidelines 
for the choice of protective actions during an emergency, consistent 
with Federal guidance, are developed and in place and protective actions 
for the ingestion exposure pathway EPZ appropriate to the locale have 
been developed.
    (11) Means for controlling radiological exposures, in an emergency, 
are establishd for emergency workers. The means for controlling 
radiological exposures shall include exposure guidelines consistent with 
EPA Emergency Worker and Lifesaving Activity Protective Action Guides.
    (12) Arrangements are made for medical services for contaminated 
injured individuals.
    (13) General plans for recovery and reentry are developed.
    (14) Periodic exercises are (will be) conducted to evaluate major 
portions of emergency response capabilities, periodic drills are (will 
be) conducted to develop and maintain key skills and deficiencies 
identified as a result of exercises or drills are (will be) corrected.
    (15) Radiological emergency response training is provided to those 
who may be called upon to assist in an emergency.
    (16) Responsibilities for plan development and review and for 
distribution of emergency plans are established, and planners are 
properly trained.
    (b) In order for State of local plans and preparedness to be 
approved, such plans and preparedness must be determined to adequately 
protect the public health and safety by providing reasonable assurance 
that appropriate protective measures can be taken offsite in the event 
of a radiological emergency.

[[Page 588]]



Sec. 350.6  Assistance in development of State and local plans.

    (a) An integrated approach to the development of offsite 
radiological emergency plans by States, localities and the licensees of 
NRC with the assistance of the Federal Government is the approach most 
likely to provide the best protection to the public. Hence, Federal 
agencies, including FEMA Regional staff, will be made available upon 
request to assist States and localities in the development of plans.
    (b) There now exists in each of the ten standard Federal Regions a 
Regional Assistance Committee (RAC) (formerly the Regional Advisory 
Committee) chaired by a FEMA Regional official and having members from 
the Nuclear Regulatory Commission, Department of Health and Human 
Services, Department of Energy, Department of Transportation, 
Environmental Protection Agency, the United States Department of 
Agriculture and Department of Commerce. Whereas in 44 CFR part 351, the 
Department of Defense is listed as a potential member of the RACs, it is 
not listed in this rule because military nuclear facilities are not the 
subject of concern. The RACs will assist State and local government 
officials in the development of their radiological emergency response 
plans, and will review plans and observe exercises to evaluate the 
adequacy of these plans and related preparedness. This assistance does 
not include the actual writing of State and local government plans by 
RAC members.
    (c) In accomplishing the foregoing, the RACs will use the standards 
and criteria in NUREG-0654/FEMA-REP-1, Rev. 1, and will render such 
technical assistance as may be required, appropriate to their agency 
mission and expertise. In observing and evaluating exercises, the RACs 
will identify, soon after an exercise, any deficiencies observed in the 
planning and preparedness effort including deficiencies in resources, 
training of staff, equipment, staffing levels and deficiencies in the 
qualifications of personnel.



Sec. 350.7  Application by State for review and approval.

    (a) A State which seeks formal review and approval by FEMA of the 
State's radiological emergency plan shall submit an application for such 
review and approval to the FEMA Regional Director of the Region in which 
the State is located. The application, in the form of a letter from the 
Govenor or from such other State official as the Governor may designate, 
shall contain one copy of the completed State plan, including coverage 
of response in the ingestion exposure pathway EPZ. The application will 
also include plans of all appropriate local governments. The application 
shall specify the site or sites for which plan approval is sought. For 
guidance on the local government plans that should be included with an 
application, refer to Part I.E. NUREG-0654/FEMA-REP-1, Rev. 1, entitled 
Contiguous Jurisdiction Governmental Emergency Planning (see (e)). Only 
a State may request formal review of State or local radiological 
emergency plans.
    (b) Generally, the plume exposure pathway EPZ for nuclear power 
facilities shall consist of an area about 10 miles (16 Km) in radius and 
the ingestion exposure pathway EPZ shall consist of an area about 50 
miles (80 Km) in radius. The exact size and configuration of the EPZs 
surrounding a particular nuclear power facility shall be determined by 
State and local governments in consultation with FEMA and NRC taking 
into account such local conditions as demography, topography, land 
characteristics, access routes and local jurisdiction boundaries. The 
size of the EPZs may be determined by NRC in consultation with FEMA on a 
case-by-case basis for gas cooled reactors and for reactors with an 
authorized power level less than 250 Mw thermal. The plans for the 
ingestion exposure pathway shall focus on such actions as are 
appropriate to protect the public from ingesting contaminated food and 
water.
    (c) A State may submit separately its plans for the EPZs and the 
local government plans related to individual nuclear power facilities. 
The purpose of separate submissions is to allow approval of a State 
plan, and of the plans necessary for specific nuclear power facilities 
in a multiple-facility State, while not approving or acting on the plans 
necessary for other nuclear

[[Page 589]]

power facilities within the State. If separate submissions are made, 
appropriate adjustments in the State plan may be necessary. In any 
event, FEMA approval of State plans and appropriate local government 
plans shall be site specific.
    (d) The applications shall contain a statement that the State plan, 
together with the appropriate local plans, is, in the opinion of the 
State, adequate to protect the public health and safety of its citizens 
living within the emergency planning zones for the nuclear power 
facilities included in the submission by providing reasonable assurance 
that State and local governments can and intend to effect appropriate 
protective measures offsite in the event of a radiological emergency.
    (e) FEMA and the States will make suitable arrangements in the case 
of overlapping or adjacent jurisdictions to permit an orderly assessment 
and approval of interstate or interregional plans.



Sec. 350.8  Initial FEMA action on State plan.

    (a) The Regional Director shall acknowledge in writing within ten 
days the receipt of the State application.
    (b) FEMA shall publish a notice signed by the Regional Director or 
designee in the Federal Register within 30 days after receipt of the 
application, that an application from a State has been received and that 
copies are available at the Regional Office for review and copying in 
accordance with 44 CFR 5.26.
    (c) The Regional Director shall furnish copies of the plan to 
members of the RAC for their analysis and evaluation.
    (d) The Regional Director shall make a detailed review of the State 
plan, including those of local governments, and assess the capability of 
State and local governments to effectively implement the plan (e.g., 
adequacy and maintenance of procedures, training, resources, staffing 
levels and qualification and equipment adequacy). Evaluation and 
comments of the RAC members will be used as part of the review process.
    (e) In connection with the review, the Regional Director may make 
suggestions to States concerning perceived gaps or deficiencies in the 
plans, and the State may amend the plan at any time prior to forwarding 
to the Associate Director of FEMA.
    (f) Two conditions for FEMA approval of State plans (including local 
government plans) are the requirements for an exercise (see Sec. 350.9), 
and for public participation (see Secs. 350.9 and 350.10.). These 
activities occur during the Regional review and prior to the forwarding 
of the plan to the Associate Director.



Sec. 350.9  Exercises.

    (a) Before a Regional Director can forward a State plan to the 
Associate Director for approval, the State, together with all 
appropriate local governments, must conduct a joint exercise of that 
State plan, involving full participation 1 of appropriate 
local government entities, the State and the appropriate licensee of the 
NRC. To the extent achievable, this exercise shall include participation 
by appropriate Federal agencies. This exercise shall be observed and 
evaluated by FEMA and by representatives of other Federal agencies with 
membership on the RACs and by NRC with respect to licensee response. 
Within 48 hours of the completion of the exercise, a briefing involving 
the exercise participants and Federal observers shall be conducted by 
the Regional Director to discuss the preliminary results of the 
exercise. If the exercise discloses any deficiencies in the State and 
local plans, or the ability of the State and local governments to 
implement the plans, the FEMA representatives shall make them known 
promptly in writing to appropriate State officials. To the extent 
necessary, the State shall amend the plan to incorporate recommended 
changes or improvements or take other corrective measures, such as 
remedial exercises,\1\ to demonstrate to the Regional Director that 
identified weaknesses have been corrected.
---------------------------------------------------------------------------

    1 See Sec. 350.2 for definitions of ``full 
participation'' and ``remedial exercises''.
---------------------------------------------------------------------------

    (b) The Regional Director shall be the FEMA official responsible for 
certifying to the Associate Director that an exercise of the State plan 
has been

[[Page 590]]

conducted, and that changes and corrective measures in accordance with 
paragraph (a) of this section have been made.
    (c) State and local governments that have fully participated in a 
joint exercise within one year prior to the effective date of this final 
rule will have continuing approval of their radiological emergency plans 
and preparedness by following the frequency indicated in paragraphs (c) 
(1) through (4) of this section. State and local governments that have 
not fully participated in a joint exercise within one year prior to the 
effective date of this final rule will follow the frequency indicated in 
paragraphs (c) (1) through (4) of this section after completion of a 
joint exercise in which they have fully participated. If, in developing 
exercise schedules with State and local governments to implement the 
requirements in paragraphs (c) (1) through (4) of this section, the 
Regional Director finds that unusual hardships would result, he may seek 
relief from the Associate Director.
    (1) Each State which has a commercial nuclear power site within its 
boundaries or is within the 10-mile plume exposure pathway Emergency 
Planning Zone of such site shall fully participate in an exercise 
jointly with the nuclear power plant licensee and appropriate local 
governments at least every two years.
    (2) Each State with multiple sites within its boundaries shall fully 
participate in a joint exercise at some site on a rotational basis at 
least every 2 years. When not fully participating in an exercise at a 
site, the State shall partially participate 2 at that site to 
support the full participation of appropriate local governments. 
Priority shall be given to new facilities seeking an operating license 
from the NRC and which have not fully participated in a joint exercise 
involving the State, local governments and the licensee at that site. 
State and local governments will coordinate the scheduling of these 
exercises with the appropriate FEMA and NRC Regional Offices and the 
affected licensees.
---------------------------------------------------------------------------

    2 See Sec. 350.2 for definition of ``partial exercise''.
---------------------------------------------------------------------------

    (3) Each appropriate local government which has a site within its 
boundaries or is within the 10-mile emergency planning zone shall fully 
participate in a joint exercise with the licensee and the State at least 
every two years. For those local governments that have planning and 
preparedness responsibilities for more than one facility, the Regional 
Director may seek an exemption from this requirement by recommending 
alternative arrangements for approval by the Associate Director.
    (4) States within the 50-mile emergency planning zone of a site 
shall exercise their plans and preparedness related to ingestion 
exposure pathway measures at least once every five years in conjunction 
with a plume exposure pathway exercise for that site.
    (5) Remedial exercises may be required to correct deficiencies 
observed in exercises conducted for continued FEMA approval. Should this 
occur, the FEMA Regional Director will determine the participation 
required from the States and/or local governments.
    (d) Within 48 hours of the completion of an exercise conducted for 
continued FEMA approval, a briefing involving the exercise participants 
and Federal observers shall be conducted by the Regional Director to 
discuss the preliminary results of the exercise. If the exercise 
discloses any deficiencies in the State and local plans, or the ability 
of the State and local governments to implement the plans, the FEMA 
representatives shall make them known promptly in writing to appropriate 
State officials. To the extent necessary, the State shall amend the plan 
to incorporate recommended changes or improvements or take other 
corrective measures, such as remedial exercises, to demonstrate to the 
Regional Director that identified weaknesses have been corrected. The 
Regional Director shall forward his or her evaluation of the exercise 
conducted for continued FEMA approval to the Associate Director 
including the certification that changes and corrective measures have 
been made.
    (e) Following the exercise conducted for continued FEMA approval, 
the Regional Director shall conduct a meeting in the vicinity of the 
nuclear power

[[Page 591]]

facility which will include the exercise participants, representatives 
from the NRC and other appropriate Federal agencies and the public and 
media as observers. The purpose of this meeting is to discuss the 
evaluation of the exercise. At the discretion of the Regional Director, 
written comments from the public and media may be submitted at or after 
the meeting. These comments will be taken into consideration by the 
Regional Director in his or her evaluation.
    (f) After FEMA approval of a State and local plan has been granted, 
failure to exercise the State and local plans at the frequency and 
participation described in this section shall be grounds for withdrawing 
FEMA approval. (See Sec. 350.13.)



Sec. 350.10  Public meeting in advance of FEMA approval.

    (a) During the FEMA Regional Office review of a State plan and prior 
to the submission by the Regional Director of the evaluation of the plan 
and exercise to the Associate Director, the FEMA Regional Director shall 
assure that there is at least one public meeting conducted in the 
vicinity of the nuclear power facility. The purpose of such a meeting, 
which may be conducted by the State or by the Regional Director, shall 
be to:
    (1) Acquaint the members of the public in the vicinity of each 
facility with the content of the State and related local plans, and with 
the conduct of the joint exercise which tested the plans;
    (2) Answer any questions about FEMA review of the plan and the 
exercise;
    (3) Receive suggestions from the public concerning improvements or 
changes that may be necessary; and
    (4) Describe to the public the way in which the plan is expected to 
function in the event of an actual emergency.
    (b) The Regional Director should assure that representatives from 
appropriate State and local government agencies, and the affected 
utility appear at such meetings to make presentations and to answer 
questions from the public. The public meeting should be held after the 
first joint (utility, State and local governments) exercise at a time 
mutually agreed to by State and local authorities, licensee and FEMA and 
NRC Regional officials. This meeting shall be noticed in the local 
newpaper with the largest circulation in the area, or other such media 
as the Regional Director may select, on at least two occasions, one of 
which is at least two weeks before the meeting takes place and the other 
is within a few days of the meeting date. Local radio and television 
stations should be notified of the scheduled meeting at least one week 
in advance. Representatives from NRC and other appropriate Federal 
agencies should also be invited to participate in these meetings. If, in 
the judgment of the FEMA Regional Director, the public meeting or 
meetings reveal deficiencies in the State plan and/or the joint 
exercise, the Regional Director shall inform the State of the fact 
together with recommendations for improvement. No FEMA approval of State 
and local plans and preparedness shall be made until a meeting described 
in this paragraph shall have been held at or near the nuclear power 
facility site for which the State is seeking approval.



Sec. 350.11  Action by FEMA Regional Director.

    (a) Upon completion of his or her review, including conduct of the 
exercise required by Sec. 350.9 and after the public meeting required by 
Sec. 350.10, the Regional Director shall prepare an evaluation of the 
State plan, including plans for local governments. Such evaluation shall 
be specific with respect to the plans applicable to each nuclear 
facility so that findings and determinations can be made by the 
Associate Director on a site-specific basis.
    (b) The Regional Director shall evaluate the adequacy of State and 
local plans and preparedness on the basis of the criteria set forth in 
Sec. 350.5, and shall report the evaluation with respect to each of the 
planning standards mentioned therein as such apply to State and local 
plans and preparedness.
    (c) The Regional Director shall forward the State plan together with 
his or her evaluation and other relevant record material to the 
Associate Director. Relevant record material will include the results of 
the exercise (i.e., deficiencies noted and corrections

[[Page 592]]

made), a summary of the deficiencies identified during the public 
meeting, recommendations made to the State and commitments made by the 
State for effecting improvements in its plans and preparedness and 
actions taken by the State.



Sec. 350.12  FEMA Headquarters review and approval.

    (a) Upon receipt from a Regional Director of a State plan, the 
Associate Director shall conduct such review of the State plan as he or 
she shall deem necessary. The Associate Director shall arrange for 
copies of the plan, together with the Regional Director's evaluation, to 
be made available to the members of the Federal Radiological 
Preparedness Coordinating Committee (FRPCC) and to other offices of FEMA 
with appropriate guidance relative to any assistance that may be needed 
in the FEMA review and approval process.
    (b) If, after formal submission of the State plan and the Regional 
Director's evaluation, the Associate Director determines that the State 
plans and preparedness:
    (1) Are adequate to protect the health and safety of the public 
living in the vicinity of the nuclear power facility by providing 
reasonable assurance that appropriate protective measures can be taken 
offsite in the event of a radiological emergency; and
    (2) Are capable of being implemented (e.g. adequacy and maintenance 
of procedures, training, resources, staffing levels and qualification 
and equipment adequacy); the Associate Director shall approve in writing 
the State plan. The Associate Director shall concurrently communicate 
this FEMA approval to the Governor of the State(s) in question, the NRC 
and the pertinent Regional Director(s) and immediately shall publish in 
the Federal Register a notice of this effect.
    (c) If, after formal submission of the State plan, the Associate 
Director is not satisfied with the adequacy of the plan or preparedness 
with respect to a particular site, he or she shall concurrently 
communicate that decision to the Governor(s) of the State(s), the NRC 
and the pertinent Regional Director(s), together with a statement in 
writing explaining the reasons for the decision and requesting 
appropriate plan or preparedness revision. Such statement shall be 
transmitted to the Governor(s) through the appropriate Regional 
Director(s). The Associate Director shall immediately publish a notice 
to this effect in the Federal Register.
    (d) The approval shall be of the State plan together with the local 
plans for each nuclear power facility (including out-of-State 
facilities) for which approval has been requested. FEMA may withhold 
approval of plans applicable to a specific nuclear power facility in a 
multi-facility State, but nevertheless approve the State plan and 
associated local plans applicable to other facilities in a State. 
Approval may be withheld for a specific site until plans for all 
jurisdictions within the emergency planning zones of that site have been 
reviewed and found adequate.
    (e) Within 30 days after the date of notification of approval for a 
particular nuclear power facility or within 30 days of any statement of 
disapproval of a State plan, any interested person may appeal the 
decision of the Associate Director to the Director; however, such an 
appeal must be made solely upon the ground that the Associate Director's 
decision, based on the available record, was unsupported by substantial 
evidence. (See Sec. 350.15 for appeal procedures.)



Sec. 350.13  Withdrawal of approval.

    (a) If, at any time after granting approval of a State plan, the 
Associate Director determines, on his or her own initiative, motion or 
on the basis of information another person supplied, that the State or 
local plan is no longer adequate to protect public health and safety by 
providing reasonable assurance that appropriate protective measures can 
be taken, or is no longer capable of being implemented, he or she shall 
immediately advise the Governor of the affected State, through the 
appropriate Regional Director and the NRC of that initial determination 
in writing. FEMA shall spell out in detail the reasons for its initial 
determination, and shall describe the deficiencies in the plan or the 
preparedness of the State. If, after four months from

[[Page 593]]

the date of such an initial determination, the State in question has not 
either:
    (1) Corrected the deficiencies noted, or (2) submitted an acceptable 
plan for correcting those deficiencies, the Associate Director shall 
withdraw approval and shall immediately inform the NRC and the Governor 
of the affected State, of the determination to withdraw approval and 
shall publish in the Federal Register and the local newspaper having the 
largest daily circulation in the affected State notice of its withdrawal 
or approval. The basis upon which the Associate Director makes the 
determination for withdrawal of approval is the same basis used for 
reviewing plans and exercises, i.e., the planning standards and related 
criteria in NUREGO654/FEMA/REP-1, Rev. 1.
    (b) In the event that the State in question shall submit a plan for 
correcting the deficiencies, the Associate Director shall negotiate a 
schedule and a timetable under which the State shall correct the 
deficiencies. If, on the agreed upon date, the deficiencies have been 
corrected, the Associate Director shall withdraw the initial 
determination and the approval previously granted shall remain valid. He 
or she shall inform the Governor(s), the NRC, the pertinent Regional 
Directors(s) and notify the public as stated in paragraph (a) of this 
section. If, however, on the agreed upon date, the deficiencies are not 
corrected, FEMA shall withdraw its approval and shall communicate its 
decision to the Governor of the State whose plan is in question, the 
NRC, the appropriate Federal agencies and notify the public as indicated 
above.
    (c) Within 30 days after the date of notification of withdrawal of 
approval of a State or local plan, any interested person may appeal the 
decision of the Associate Director to the Director; however, such an 
appeal must be made solely upon the ground that the Associate Director's 
decision, based on the available record, was unsupported by substantial 
evidence. (See Sec. 350.15 for appeal procedures.)



Sec. 350.14  Amendments to State plans.

    (a) The State may amend a plan submitted to FEMA for review and 
approval under Sec. 350.7 at any time during the review process or may 
amend a plan at any time after FEMA approval has been granted under 
Sec. 350.12. A State must amend its plan in order to extend the coverage 
of the plan to any new nuclear power facility which becomes operational 
after a FEMA approval or in case of any other significant change. The 
State plan shall remain in effect as approved while any significant 
change is under review.
    (b) A significant change is one which involves the evaluation and 
assessment of a planning standard or which involves a matter which, if 
presented with the plan, would need to have been considered by the 
Associate Director in making a decision that State or local plans and 
preparedness are:
    (1) Adequate to protect the health and safety of the public living 
in the vicinity of the nuclear power facility by providing reasonable 
assurance that appropriate protective measures can be taken offsite in 
the event of a radiological emergency; and
    (2) Capable of being implemented.
    (c) A significant change will be processed in the same manner as if 
it were an initial plan submission. However, the Regional Director may 
determine that certain procedures, such as holding a public meeting or a 
complete exercise, would be unnecessary. The existing FEMA approval 
shall remain in effect while any significant changes are under review.
    (d) Changes, such as a change in a telephone number, that are not 
significant as defined in paragraphs (b) and (c) of this section, but 
are necessary to maintain currency of the plan, should be forwarded to 
the Regional Director.



Sec. 350.15  Appeal procedures.

    (a) Any interested person may appeal a decision made under 
Secs. 350.12 and 350.13 of this part, by submitting to the Director, 
FEMA, a written notice of appeal, within 30 days after the appearance in 
the Federal Register, of the notice of decision relating to the matter 
being appealed. The appeal must be addressed to the Director, Federal 
Emergency Management Agency, 500 C Street, SW., Washington, DC, 20472. 
The appeal letter shall state specific reasons for the appeal and 
include an

[[Page 594]]

offer to provide documentation supporting appellate arguments.
    (b) Upon receipt of an appeal, the Director or the Director's 
designee shall review the file, as submitted to the Associate Director, 
State and Local Programs and Support, by the Regional Director of the 
FEMA Region concerned, based on the information contained in the file 
and the appeal letter, with supporting documentation. The Director or 
the Director's designee shall decide whether or not the Associate 
Director's initial decision was supported by substantial evidence in the 
file and is consistent with FEMA policy.
    (c) The decision of the Director or the Director's designee shall be 
published in the Federal Register as the final agency decision on the 
matter and shall not be reviewable within FEMA, except upon a showing 
that it was procured by fraud or misrepresentation. In addition to 
publication in the Federal Register, copies of the decision shall be 
forwarded to the appellant, the Governor(s) of the State(s) affected, 
the NRC and the affected licensee of the involved power facility.



PART 351--RADIOLOGICAL EMERGENCY PLANNING AND PREPAREDNESS--Table of Contents




                           Subpart A--General

Sec.
351.1  Purpose.
351.2  Scope.
351.3  Limitation of scope.

Subpart B--Federal Radiological Preparedness Coordinating Committee and 
                     Regional Assistance Committees

351.10  Establishment of committees.
351.11  Functions of committees.

                   Subpart C--Interagency Assignments

351.20  The Federal Emergency Management Agency.
351.21  The Nuclear Regulatory Commission.
351.22  The Environmental Protection Agency.
351.23  The Department of Health and Human Services.
351.24  The Department of Energy.
351.25  The Department of Transportation.
351.26  The United States Department of Agriculture.
351.27  The Department of Defense.
351.28  The Department of Commerce.

    Authority: 5 U.S.C. 552, Reorganization Plan No. 3 of 1978, E.O. 
12127, E.O. 12148, E.O. 12241; Presidential Directive of Dec. 7, 1979.

    Source: 47 FR 10759, Mar. 11, 1982, unless otherwise noted.



                           Subpart A--General



Sec. 351.1  Purpose.

    This part sets out Federal agency roles and assigns tasks regarding 
Federal assistance to State and local governments in their radiological 
emergency planning and preparedness activities. Assignments in this part 
are applicable to radiological accidents at fixed nuclear facilities and 
transportation accidents involving radioactive materials.



Sec. 351.2  Scope.

    The emergency planning and preparedness responsibilities covered by 
this part relate to consequences and activities which extend beyond the 
boundaries of any fixed nuclear facility with a potential for serious 
consequences and the area affected by a transportation accident 
involving radioactive materials.



Sec. 351.3  Limitation of scope.

    (a) This part covers Federal agency assignments and responsibilities 
in connection with State and local emergency plans and preparedness 
measures. It does not set forth criteria used in the review and approval 
of these plans and does not include any of the requirements associated 
with FEMA findings and determinations on the adequacy of State and local 
government radiological emergency preparedness. FEMA has published a 
separate rule on procedures and criteria for reviewing and approving 
these plans and preparedness capabilities. Furthermore, this part does 
not set forth Federal agency responsibilities or capabilities for 
responding to an accident at a fixed nuclear facility or a 
transportation accident involving radioactive materials. These 
responsibilities are addressed in the ``Federal Radiological Emergency 
Response Plan'' (50 FR 46542, November 8, 1985).

[[Page 595]]

    (b) Nothing in this part authorizes access to or disclosure of 
classified information required to be protected in accordance with 
Federal law or regulation in the interest of national security.

[47 FR 10759, Mar. 11, 1982, as amended at 51 FR 34606, Sept. 30, 1986]



Subpart B--Federal Radiological Preparedness Coordinating Committee and 
                     Regional Assistance Committees



Sec. 351.10  Establishment of committees.

    (a) The Federal Radiological Preparedness Coordinating Committee 
(FRPCC) consists of the Federal Emergency Management Agency, which 
chairs the Committee, Nuclear Regulatory Commission, Environmental 
Protection Agency, Department of Health and Human Services, Department 
of Energy, Department of Transportation, Department of Defense, United 
States Department of Agriculture, Department of Commerce and, where 
appropriate and on an ad hoc basis, other Federal departments and 
agencies. In chairing the committee, FEMA will be responsible for 
assuring that all agency assignments described in this rule are 
coordinated through the Committee and carried out with or on behalf of 
State and local governments.
    (b) The Regional Assistance Committees (RACs), one in each of 10 
standard Federal regions,\1\ consist of a FEMA Regional Representative 
who chairs the Committee and representatives from the Nuclear Regulatory 
Commission, Environmental Protection Agency, Department of Health and 
Human Services, Department of Energy, Department of Transportation, 
United States Department of Agriculture, Department of Commerce and 
other Federal departments and agencies such as the Department of 
Defense, as appropriate. The FEMA Chairperson of the RACs will provide 
guidance and orientation to other agency members to assist them in 
carrying out their functions.
---------------------------------------------------------------------------

    \1\ I (Boston); II (New York); III (Philadelphia); IV (Atlanta); V 
(Chicago); VI (Dallas); VII (Kansas City); VIII (Denver); IX (San 
Francisco) and X (Seattle).
---------------------------------------------------------------------------



Sec. 351.11  Functions of committees.

    (a) The FRPCC shall assist FEMA in providing policy direction for 
the program of Federal assistance to State and local governments in 
their radiological emergency planning and preparedness activities. The 
FRPCC will establish subcommittees to aid in carrying out its functions; 
e.g., research, training, emergency instrumentation, transportation, 
information, education and Federal response. The FRPCC will assist FEMA 
in resolving issues relating to granting of final FEMA approval of a 
State plan. The FRPCC will coordinate research and study efforts of its 
member agencies related to State and local government radiological 
emergency preparedness to assure minimum duplication and maximum 
benefits to State and local governments. The FRPCC will also assure that 
the research efforts of its member agencies are coordinated with the 
Interagency Radiation Research Committee.
    (b) The RACs will assist State and local government officials in the 
development of their radiological emergency plans and will review these 
plans and observe exercises to evaluate adequacy of the plans. Each 
Federal agency member of the RACs will support the functions of these 
committees by becoming knowledgeable of Federal planning and guidance 
related to State and local radiological emergency plans, of their 
counterpart State organizations and personnel, where their agency can 
assist in improving the preparedness and by participating in RAC 
meetings.



                   Subpart C--Interagency Assignments



Sec. 351.20  The Federal Emergency Management Agency.

    (a) Establish policy and provide leadership via the FRPCC in the 
coordination of all Federal assistance and guidance to State and local 
governments for developing, reviewing, assessing and testing the State 
and local radiological emergency plans.
    (b) Issue guidance in cooperation with other Federal agencies 
concerning

[[Page 596]]

their responsibilities for providing radiological emergency planning and 
preparedness assistance to State and local governments.
    (c) Foster cooperation of industry, technical societies, Federal 
agencies and other constituencies in the radiological emergency planning 
and preparedness of State and local governments.
    (d) Develop and promulgate preparedness criteria and guidance to 
State and local governments, in coordination with other Federal 
agencies, for the preparation, review and testing of State and local 
radiological emergency plans.
    (e) Provide assistance to State and local governments in the 
preparation, review and testing of radiological emergency plans.
    (f) Assess, with the assistance of other Federal agencies, the 
adequacy of State and local government emergency plans and the 
capability of the State and local government officials to implement them 
(e.g., adequacy and maintenance of equipment, procedures, training, 
resources, staffing levels and qualifications) and report the findings 
and determinations to NRC.
    (g) Review and approve State radiological emergency plans and 
preparedness in accordance with FEMA procedures in 44 CFR part 350.
    (h) Develop, implement and maintain a program of public education 
and information to support State and local radiological emergency plans 
and preparedness.
    (i) Develop and manage a radiological emergency response training 
program to meet State and local needs, using technical expertise and 
resources of other involved agencies. Develop and field test exercise 
materials and coordinate the Federal assistance required by States and 
localities in conducting exercises, including guidance for Federal 
observers.
    (j) Develop, with NRC and other Federal Agencies, representative 
scenarios from which NRC licensed facility operators and State and local 
governments may select for use in testing and exercising radiological 
emergency plans.
    (k) Issue guidance for establishment of State and local emergency 
instrumentation systems for radiation detection and measurement.
    (l) Provide guidance and assistance, in coordination with NRC and 
HHS, to State and local governments concerning the storage and 
distribution of radioprotective substances and prophylactic use of drugs 
(e.g., potassium iodide) to reduce the radiation dose to specific organs 
as a result of radiological emergencies.



Sec. 351.21  The Nuclear Regulatory Commission.

    (a) Assess NRC nuclear facility (e.g., commercial power plants, fuel 
processing centers and research reactors) licensee emergency plans for 
adequacy to protect the health and safety of the public.
    (b) Verify that nuclear facility licensee emergency plans can be 
adequately implemented (e.g., adequacy and maintenance of equipment, 
procedures, training, resources, staffing levels and qualifications).
    (c) Review FEMA's findings and determinations of State and local 
radiological emergency plans for areas surrounding NRC licensed nuclear 
facilities.
    (d) Take into account the overall state of emergency preparedness in 
making decisions to issue operating licenses or shut down licensed 
operating reactors, including the integration of assessments of 
emergency preparedness onsite by the NRC and offsite by FEMA.
    (e) Where not already established, determine, in cooperation with 
other Federal agencies, the appropriate planning bases for NRC licensed 
nuclear facilities including distances, times and radiological 
characteristics.
    (f) Assist FEMA in developing and promulgating guidance to State and 
local governments for the preparation of radiological emergency plans.
    (g) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and evaluating the plans and preparedness.
    (h) Assist FEMA and DOT in the preparation and promulgation of 
guidance to State and local governments

[[Page 597]]

for their use in developing the transportation portions of radiological 
emergency plans.
    (i) Provide representation to and support for the FRPCC and the 
RACs.
    (j) Assist FEMA in the development, implementation and maintenance 
of public information and education programs.
    (k) Assist FEMA with other Federal agencies in the development of 
representative scenarios from which nuclear facility operators and State 
and local governments may select for use in testing and exercising 
radiological emergency plans.
    (l) Assist FEMA in the development of guidance for State and local 
governments on emergency instrumentation systems for radiation detection 
and measurement.
    (m) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of training programs 
for Federal, State and local radiological emergency preparedness 
personnel.
    (n) Assist FEMA in providing guidance and assistance to State and 
local governments concerning the storage and distribution of 
radioprotective substances and prophylactic use of drugs (e.g., 
potassium iodide) to reduce the radiation dose to specific organs as a 
result of radiological emergencies.



Sec. 351.22  The Environmental Protection Agency.

    (a) Establish Protective Action Guides (PAGs) for all aspects of 
radiological emergency planning in coordination with appropriate Federal 
agencies.
    (b) Prepare guidance for State and local governments on implementing 
PAGs, including recommendations on protective actions which can be taken 
to mitigate the potential radiation dose to the population. This 
guidance will be presented in the Environmental Protection Agency (EPA) 
``Manual of Protective Action Guides and Protective Actions for Nuclear 
Incidents.'' (The preparation of PAGs related to human food and animal 
feed will be done in coordination with the Department of Health and 
Human Services (HHS)/Food and Drug Administration.)
    (c) Assist FEMA in developing and promulgating guidance to State and 
local governments for the preparation of radiological emergency plans.
    (d) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of technical training 
for State and local officials regarding PAGs and protective actions, 
radiation dose assessment and decisionmaking.
    (e) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and evaluating the plans and preparedness.
    (f) Assist FEMA in the development of guidance for State and local 
governments on emergency instrumentation systems for radiation detection 
and measurement.
    (g) Provide representation to and support for the FRPCC and the 
RACs.
    (h) Assist FEMA in developing representative scenarios from which 
nuclear facility operators and State and local governments may select 
for use in testing and exercising radiological emergency plans.
    (i) Assist FEMA in the development, implementation and maintenance 
of public information and education programs.



Sec. 351.23  The Department of Health and Human Services.

    (a) Develop and specify protective actions and associated guidance 
to State and local governments for human food and animal feed (in 
cooperation with the Environmental Protection Agency).
    (b) Provide guidance and assistance to State and local governments 
in preparing programs related to mental health, behavioral disturbances 
and epidemiology associated with radiological emergencies.
    (c) Assist FEMA in the development, implementation and maintenance 
of public information and education programs to support State and local 
government radiological emergency plans and preparedness.

[[Page 598]]

    (d) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of a radiological 
emergency training program to support State and local government 
personnel in accident assessment, protective actions and decisionmaking.
    (e) Develop and assist in providing the requisite training programs 
for State and local health, mental health and social service agencies.
    (f) Provide guidance to State and local governments on the use of 
radio-protective substances and prophylactic use of drugs (e.g., 
potassium iodide) to reduce the radiation dose to specific organs 
including dosage and projected radiation exposures at which such drugs 
should be used.
    (g) Assist FEMA in developing and promulgating guidance to State and 
local governments for the preparation of radiological emergency plans.
    (h) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and evaluating the plans and preparedness.
    (i) Provide representation to and support for the FRPCC and the 
RACs.
    (j) Assist FEMA in developing representative scenarios from which 
nuclear facility operators and State and local governments may select 
for use in testing and exercising radiological emergency plans.
    (k) Assist FEMA in the development of guidance for State and local 
governments on emergency instrumentation systems for radiation detection 
and measurement.
    (l) Assist, in cooperation with the United States Department of 
Agriculture (USDA), the State and local governments in the planning for 
the safe production, during radiological emergencies, of human food and 
animal feed in the emergency planning zones around fixed nuclear 
facilities.
    (m) Assist FEMA, through the Interagency Radiation Research 
Committee, chaired by the Department of Health and Human Services, in 
the coordination of Federal research efforts, primarily in areas related 
to the bioeffects of radiation, applicable to State and local plans and 
preparedness.



Sec. 351.24  The Department of Energy.

    (a) Determine the appropriate planning bases for the Department of 
Energy (DOE) owned and contractor operated nuclear facilities (e.g., 
research and weapon production facilities) including distances, time and 
radiological characteristics.
    (b) Assess DOE nuclear facility emergency plans for adequacy in 
contributing to the health and safety of the public.
    (c) Verify that DOE nuclear facility emergency plans can be 
adequately implemented (e.g., adequacy and maintenance of equipment, 
procedures, training, resources, staffing levels and qualifications).
    (d) Assist State and local governments, within the constraints of 
national security and in coordination with FEMA, in the preparation of 
those portions of their radiological emergency plans related to DOE 
owned and contractor operated nuclear facilities and radioactive 
materials in transit.
    (e) Review and assess FEMA's findings and determinations on the 
adequacy of and capability to implement State and local radiological 
emergency plans for areas surrounding DOE nuclear facilities. Make 
independent assessments of the overall State of plans and preparedness.
    (f) Serve as the lead agency for coordinating the development and 
issuance of interagency instructions and guidance to implement the 
Federal Radiological Monitoring and Assessment Plan (FRMAP), which will 
replace the Interagency Radiological Assistance Plan. The FRMAP provides 
the framework through which participating Federal agencies will 
coordinate their emergency radiological monitoring and assessment 
activities with those of State and local governments.
    (g) Develop, maintain and improve capability to detect and assess 
hazardous levels of radiation.
    (h) Assist FEMA in developing and promulgating guidance to State and 
local governments for the preparation of radiological emergency plans.
    (i) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of training programs 
for Federal,

[[Page 599]]

State and local radiological emergency response personnel.
    (j) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and evaluating the plans and preparedness.
    (k) Develop, with FEMA, representative scenarios from which DOE 
facility operators and State and local governments may select for use in 
testing and exercising radiological emergency plans.
    (l) Provide representation to and support for the FRPCC and the 
RACs.
    (m) Assist FEMA in the development of guidance for State and local 
governments on emergency instrumentation systems for radiation detection 
and measurement.



Sec. 351.25  The Department of Transportation.

    (a) Assist FEMA, along with NRC, in the preparation and promulgation 
of guidance to State and local governments for their use in developing 
the transportation portions of radiological emergency plans.
    (b) Assist FEMA in its review and approval of State and local 
radiological emergency plans and in the evaluation of exercises to test 
such plans.
    (c) Provide guidance and materials for use in training emergency 
services and other response personnel for transportation accidents 
involving radioactive materials and participate in interagency planning 
for such training.
    (d) Provide representation to and support for the FRPCC and the 
RACs.



Sec. 351.26  The United States Department of Agriculture.

    (a) Assist FEMA in developing and promulgating guidance to State and 
local governments for the preparation of radiological emergency plans.
    (b) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and reviewing and evaluating the plans and preparedness.
    (c) Assist State and local governments in preparing to implement 
protective actions in food ingestion pathway emergency planning zones 
around fixed nuclear facilities.
    (d) Develop, in coordination with FEMA, the HHS and other Federal 
agencies, guidance for assisting State and local governments in the 
production, processing and distribution of food resources under 
radiological emergency conditions.
    (e) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of training programs of 
Federal, State and local radiological emergency personnel.
    (f) Provide representation to and support for the FRPCC and the 
RACs.



Sec. 351.27  The Department of Defense.

    (a) Determine appropriate planning bases for Department of Defense 
(DOD) nuclear facilities and installations (e.g., missile bases, nuclear 
submarine facilities and weapon storage sites) including distances, time 
and radiological characteristics.
    (b) Develop, with FEMA, representative scenarios from which DOD 
nuclear facility commanders and State and local governments may select 
for use in testing and exercising radiological emergency plans.
    (c) Assist State and local governments, within the constraints of 
national security and in coordination with FEMA, in the development, 
review and assessment of those portions of their radiological emergency 
plans related to DOD nuclear facilities and assist State officials with 
planning for response to accidents involving DOD controlled radioactive 
materials in transit.
    (d) Provide representation to and support for the FRPCC and the RACs 
when appropriate.



Sec. 351.28  The Department of Commerce.

    (a) Assist State and local governments in determining their 
requirements for meteorological and hydrological services for 
radiological emergencies and assist State and local governments in 
preparing to meet these requirements within the limits of available 
resources.
    (b) Assist FEMA in developing and promulgating guidance to State and

[[Page 600]]

local governments for the preparation of radiological emergency plans.
    (c) Participate with FEMA in assisting State and local governments 
in developing their radiological emergency plans, evaluating exercises 
to test plans and evaluating the plans and preparedness.
    (d) Assist FEMA with the development, implementation and 
presentation to the extent that resources permit of technical training 
for State and local officials in the use of meterological information in 
responding to radiological emergencies.
    (e) Provide representation to and support for the FRPCC and the 
RACs.
    (f) Assist FEMA in the development of guidance for State and local 
governments on the exposure and location of emergency instrumentation 
systems for radiation detection and measurement.
    (g) The Federal Coordinator for Meteorological Services and 
Supporting Research will, consistent with the provisions of the Office 
of Management and Budget Circular A-62, serve as the coordinating agent 
for any multiagency meteorological aspects of assisting State and local 
governments in their radiological emergency planning and preparedness.



PART 352--COMMERCIAL NUCLEAR POWER PLANTS: EMERGENCY PREPAREDNESS PLANNING--Table of Contents




Sec.
352.1  Definitions.
352.2  Scope, purpose and applicability.

              Subpart A--Certifications and Determinations

352.3  Purpose and scope.
352.4  Licensee certification.
352.5  FEMA action on licensee certification.
352.6  FEMA determination on the commitment of Federal facilities and 
          resources.
352.7  Review and evaluation.

                    Subpart B--Federal Participation

352.20  Purpose and scope.
352.21  Participating Federal agencies.
352.22  Functions of the Federal Radiological Preparedness Coordinating 
          Committee (FRPCC).
352.23  Functions of a Regional Assistance Committee (RAC).
352.24  Provision of technical assistance and Federal facilities and 
          resources.
352.25  Limitation on committing Federal facilities and resources for 
          emergency preparedness.
352.26  Arrangements for Federal response in the licensee offsite 
          emergency response plan.
352.27  Federal role in the emergency response.
352.28  Reimbursement.
352.29  Appeal process.

    Authority: Federal Civil Defense Act of 1950, as amended (50 U.S.C. 
app. 2251 et seq.;) Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, 42 U.S.C. 5121 et seq.; 31 U.S.C. 9701; Executive Order 
12657; Executive Order 12148; Executive Order 12127 and Executive Order 
12241.

    Source: 54 FR 31925, Aug. 2, 1989, unless otherwise noted.



Sec. 352.1  Definitions.

    As used in this part, the following terms and concepts are defined:
    (a) Associate Director means the Associate Director, State and Local 
Programs and Support, FEMA or designee.
    (b) Director means the Director, FEMA or designee.
    (c) EPZ means Emergency Planning Zone.
    (d) FEMA means the Federal Emergency Management Agency.
    (e) NRC means the Nuclear Regulatory Commission.
    (f) Regional Director means the Regional Director of FEMA or 
designee.
    (g) Local government means boroughs, cities, counties, 
municipalities, parishes, towns, townships or other local jurisdictions 
within the plume and ingestion exposure pathway EPZs that have specific 
roles in emergency planning and preparedness.
    (h) Decline or fail means a situation where State or local 
governments do not participate in preparing offsite emergency plans or 
have significant planning or preparedness inadequacies and have not 
demonstrated the commitment or capabilities to correct those 
inadequacies in a timely manner so as to satisfy NRC licensing 
requirements.
    (i) Governor means the Governor of a State or his/her designee.
    (j) Certification means the written justification by a licensee of 
the need for Federal compensatory assistance.

[[Page 601]]

This certification is required to activate the Federal assistance under 
this part.
    (k) Responsible local official means the highest elected official of 
an appropriate local government.
    (l) Technical assistance means services provided by FEMA and other 
Federal agencies to facilitate offsite radiological emergency planning 
and preparedness such as: Provision of support for the preparation off 
site radiological emergency response plans and procedures; FEMA 
coordination of services from other Federal agencies; provision and 
interpretation of Federal guidance; provision of Federal and contract 
personnel to offer advice and recommendations for specific aspects of 
preparedness such as alert and notification and emergency public 
information.
    (m) Federal facilities and resources means personnel, property 
(land, buildings, vehicles, equipment), and operational capabilities 
controlled by the Federal government related to establishing and 
maintaining radiological emergency response preparedness.
    (n) Licensee means the utility which has applied for or has received 
a license from the NRC to operate a commercial nuclear power plant.
    (o) Reimbursement means the payment to FEMA/Federal agencies, 
jointly or severally, by a licensee and State and local governments for 
assistance and services provided in processing certifications and 
implementing Federal compensatory assistance under this part 352.
    (p) Host FEMA Regional Office means the FEMA Regional Office that 
has primary jurisdiction by virtue of the nuclear power plant being 
located within its geographic boundaries.
    (q) Command and control means making and issuing protective action 
decisions and directing offsite emergency response resources, agencies, 
and activities.



Sec. 352.2  Scope, purpose and applicability.

    (a) This part applies whenever State or local governments, either 
individually or together, decline or fail to prepare commercial nuclear 
power plant offsite radiological emergency preparedness plans that are 
sufficient to satisfy NRC licensing requirements or to participate 
adequately in the preparation, demonstration, testing, exercise, or use 
of such plans. In order to request the assistance provided for in this 
part, an affected nuclear power plant applicant or licensee shall 
certify in writing to FEMA that the above situation exists.
    (b) The purposes of this part are as follows: (1) To establish 
policies and procedures for the submission of a licensee certification 
for Federal assistance under Executive Order 12657; (2) set forth 
policies and procedures for FEMA's determination to accept, accept with 
modification, or reject the licensee certification; (3) establish a 
framework for providing Federal assistance to licensees; and (4) provide 
procedures for the review and evaluation of the adequacy of offsite 
radiological emergency planning and preparedness. Findings and 
determinations on offsite planning and preparedness made under this part 
are provided to the NRC for its use in the licensing process.
    (c) This part applies only in instances where Executive Order 12657 
is used by a licensee and its provisions do not affect the validity of 
the emergency preparedness developed by the licensee independent of or 
prior to Executive Order 12657.



              Subpart A--Certifications and Determinations



Sec. 352.3  Purpose and scope.

    This subpart establishes policies and procedures for submission by a 
commercial nuclear power plant licensee of a certification for Federal 
assistance under Executive Order 12657. It contains policies and 
procedures for FEMA's determinations, with respect to a certification. 
It establishes a framework for providing Federal assistance to 
licensees. It also provides procedures for review and evaluation of the 
adequacy of licensee offsite radiological emergency planning and 
preparedness.



Sec. 352.4  Licensee certification.

    (a) A licensee which seeks Federal assistance under this part shall 
submit a

[[Page 602]]

certification to the host FEMA Region Director that a decline or fail 
situation exists. The certification shall be in the form of a letter 
from the chief executive officer of the licensee. The contents of this 
letter shall address the provisions set forth in paragraphs (b) and (c) 
of this section.
    (b) The licensee certification shall delineate why such assistance 
is needed based on the criteria of decline or fail for the relevant 
State or local governments.
    (c) The licensee certification shall document requests to and 
responses from the Governor(s) or responsible local official(s) with 
respect to the efforts taken by the licensee to secure their 
participation, cooperation, commitment of resources or timely correction 
of planning and preparedness failures.

(Approved by the Office of Management and Budget (OMB) under control 
number 3067-0201)



Sec. 352.5  FEMA action on licensee certification.

    (a) Upon receiving a licensee certification, the host Regional 
Director shall immediately notify FEMA Headquarters of the licensee 
certification. Within 5 days the host Regional Director shall notify the 
Governor of an affected State and the chief executive officer of any 
local government that a certification has been received, and make a copy 
of the certification available to such persons. Within 10 days, the host 
Regional Director shall acknowledge in writing the receipt of the 
certification to the licensee.
    (b) Within 15 days of receipt of the certification, the Regional 
Director shall publish a notice in the Federal Register that a 
certification from the licensee has been received, and that copies are 
available at the Regional Office for review and copying in accordance 
with 44 CFR 5.26.
    (c) FEMA Headquarters shall notify the NRC of receipt of the 
certification and shall request advice from the NRC on whether a decline 
or fail situation exists.
    (d) State and local governments may submit written statements to the 
host Regional Director outlining their position as to the facts stated 
in the letter of certification. Such statements shall be submitted to 
FEMA within 10 days of the date of notification provided to State and 
local government under Sec. 352.5(a). Any such statements shall be a 
part of the record and will be considered in arriving at recommendations 
or determinations made under the provisions of this part.
    (e) The host FEMA Regional Office shall provide, after consulting 
with State and responsible local officials, a recommended determination 
on whether a decline or fail situation exists to the FEMA Associate 
Director within 30 days of receipt of the licensee certification.
    (f) The FEMA Associate Director shall make a determination on 
whether a decline or fail situation exists within 45 days of receipt of 
the licensee certification and shall advise the licensee, NRC, and State 
and local officials.
    (g) The times for actions set out above may be extended up to an 
aggregate of 30 days by the host Regional Director or Associate 
Director, as appropriate.



Sec. 352.6  FEMA determination on the commitment of Federal facilities and resources.

    (a) A licensee request for Federal facilities and resources shall 
document the licensee's maximum feasible use of its resources and its 
efforts to secure the use of State and local government and volunteer 
resources.
    (b) Upon a licensee request for Federal facilities and resources, 
FEMA headquarters shall notify NRC and request advice from the NRC as to 
whether the licensee has made maximum use of its resources and the 
extent to which the licensee has complied with 10 CFR 50.47(c)(1). The 
host FEMA Regional Director shall make a recommendation to the FEMA 
Associate Director on whether the provision of these facilities and 
resources is warranted. The FEMA Associate Director shall make a final 
determination as to whether Federal facilities and resources are needed.
    (c) In making the determination under paragraph (b) of this section, 
FEMA:
    (1) Shall work actively with the licensee, and before relying upon 
any

[[Page 603]]

Federal resources, shall make maximum feasible use of the licensee's own 
resources, which may include agreements with volunteer organizations and 
other government entities and agencies; and
    (2) Shall assume that, in the event of an actual radiological 
emergency or disaster, State and local authorities would contribute 
their full resources and exercise their authorities in accordance with 
their duties to protect the public and would act generally in conformity 
with the licensee's radiological emergency preparedness plan.
    (d) The FEMA Associate Director shall make a determination on the 
need for and commitment of Federal facilities and resources. The FEMA 
determination shall be made in consultation with affected Federal 
agencies and in accordance with 44 CFR 352.21. FEMA shall inform the 
licensee, the States and affected local governments in writing of the 
Federal support which will be provided. This information shall identify 
Federal agencies that are to provide Federal support, the extent and 
purpose of the support to be provided, the Federal facilities and 
resources to be committed and the limitations on their use. The 
provision of the identified Federal support shall be made under the 
policies and procedures of subpart B of this part.



Sec. 352.7  Review and evaluation.

    FEMA shall conduct its activities and make findings under this part 
in a manner consistent with 44 CFR part 350 to the extent that those 
procedures are appropriate and not inconsistent with the intent and 
procedures required by E.O. 12657. This Order shall take precedence, and 
any inconsistencies shall be resolved under the procedures in the NRC/
FEMA Memorandum of Understanding (MOU) on planning and preparedness. (50 
FR 15485, April 18, 1985)



                    Subpart B--Federal Participation



Sec. 352.20  Purpose and scope.

    This subpart establishes policy and procedures for providing support 
for offsite radiological emergency planning and preparedness in a 
situation where Federal support under Excutive Order 12657 (E.O. 12657) 
has been requested. This subpart:
    (a) Describes the process for providing Federal technical assistance 
to the licensee for developing its offsite emergency response plan after 
an affirmative determination on the licensee certification under subpart 
A (44 CFR 352.5(f));
    (b) Describes the process for providing Federal facilities and 
resources to the licensee after a determination under subpart A (44 CFR 
352.6(d)) that Federal resources are required;
    (c) Describes the principal response functions which Federal 
agencies may be called upon to provide;
    (d) Describes the process for allocating responsibilities among 
Federal agencies for planning site-specific emergency response 
functions; and
    (e) Provides for the participation of Federal agencies, including 
the members of the FRPCC and the RACs.



Sec. 352.21  Participating Federal agencies.

    (a) FEMA may call upon any Federal agency to participate in planning 
for the use of Federal facilities and resources in the licensee offsite 
emergency response plan.
    (b) FEMA may call upon the following agencies, and others as needed, 
to provide Federal technical assistance and Federal facilities and 
resources:
    (1) Department of Commerce;
    (2) Department of Defense;
    (3) Department of Energy;
    (4) Department of Health and Human Services;
    (5) Department of Housing and Urban Development;
    (6) Department of the Interior;
    (7) Department of Transportation;
    (8) Environmental Protection Agency;
    (9) Federal Communications Commission;
    (10) General Services Administration;
    (11) National Communications System;
    (12) Nuclear Regulatory Commission;
    (13) United States Department of Agriculture; and
    (14) Department of Veterans Affairs.
    (c) FEMA is the Federal agency primarily responsible for 
coordinating Federal assistance. FEMA may enter

[[Page 604]]

into Memorandums of Understanding (MOU) and other instruments with 
Federal agencies to provide technical assistance and to arrange for the 
commitment and utilization of Federal facilities and resources as 
necessary. FEMA also may use a MOU to delegate to another Federal 
agency, with the consent of that agency, any of the functions and duties 
assigned to FEMA. Following review and approval by OMB, FEMA will 
publish such documents in the Federal Register.



Sec. 352.22  Functions of the Federal Radiological Preparedness Coordinating Committee (FRPCC).

    Under 44 CFR part 351, the role of the FRPCC is to assist FEMA in 
providing policy direction for the program of technical assistance to 
State and local governments in their radiological emergency planning and 
preparedness activities. Under this subpart, the role of the FRPCC is to 
provide advice to FEMA regarding Federal assistance and Federal 
facilities and resources for implementing subparts A and B of this part. 
This assistance activity is extended to licensees. The FRPCC will assist 
FEMA in revising the Federal Radiological Emergency Response Plan 
(FRERP).



Sec. 352.23  Functions of a Regional Assistance Committee (RAC)

    (a) Under 44 CFR part 351, the role of a RAC is to assist State and 
local government officials to develop their radiological emergency 
plans, to review the plans, and to observe exercises to evaluate the 
plans. Under subparts A and B of this part, these technical assistance 
activities are extended to the licensee.
    (b) Prior to a determination under subpart A (44 CFR 352.6(d)) that 
Federal facilities and resources are needed, the designated RAC for the 
specific site will assist the licensee, as necessary, in evaluating the 
need for Federal facilities and resources, in addition to providing 
technical assistance under Sec. 352.23(a).
    (c) In accomplishing the foregoing, the RAC will use the standards 
and evaluation criteria in NUREG-0654/FEMA-REP-1, Rev. 1 and Supp. 1.\1\ 
or approved alternative approaches, and RAC members shall render such 
technical assistance as appropriate to their agency mission and 
expertise.
---------------------------------------------------------------------------

    \1\ Copy available from FEMA Distribution Center, P.O. Box 70274 
Washington, DC 20024
---------------------------------------------------------------------------

    (d) Following determination under subpart A (44 CFR 352.6(d)) that 
Federal facilities and resources are needed, the RAC will assist FEMA in 
identifying agencies and specifying the Federal facilities and resources 
which the agencies are to provide.



Sec. 352.24  Provision of technical assistance and Federal facilities and resources.

    (a) Under a determination under subpart A (44 CFR 352.5(f) and 
352.4(e)) that a decline or fail situation exists, FEMA and other 
Federal agencies will provide technical assistance to the licensee. Such 
assistance may be provided during the pendency of an appeal under 
Sec. 352.29.
    (b) The applicable criteria for the use of Federal facilities and 
resources are set forth in subpart A (44 CFR 352.6(c)(1)(2)). Upon a 
determination under subpart A (44 CFR 352.6(d)) that Federal resources 
or facilities will be required, FEMA will consult with the FRPCC, the 
RAC, the individual Federal agencies, and the licensee, to determine the 
extent of Federal facilities and resources that the government could 
provide, and the most effective way to do so. After such consultation, 
FEMA will specifically request Federal agencies to provide those Federal 
facilities and resources. The Federal agencies, in turn, will respond to 
confirm the availability of such facilities and resources and provide 
estimates of their costs.
    (c) FEMA will inform the licensee in writing of the Federal support 
which will be provided. This information will identify Federal agencies 
which are to be included in the plan, the extent and purpose of 
technical assistance to be provided and the Federal facilities and 
resources to be committed, and the limitations of their use. The 
information will also describe the requirements for reimbursement to the 
Federal Government for this support.

[[Page 605]]

    (d) FEMA will coordinate the Federal effort in implementing the 
determinations made under subpart A (44 CFR 352.5(f) and 352.6(d)) so 
that each Federal agency maintains the committed technical assistance, 
facilities, and resources after the licensee offsite emergency response 
plan is completed. FEMA and other Federal agencies will participate in 
training, exercises, and drills, in support of the licensee offsite 
emergency response plan.
    (e) In carrying out paragraphs (a) through (c) of this section, FEMA 
will keep affected State and local governments informed of actions 
taken.


(Approval by the OMB under control number 3067-0201)



Sec. 352.25  Limitation on committing Federal facilities and resources for emergency preparedness.

    (a) The commitment of Federal facilities and resources will be made 
through the authority of the affected Federal agencies.
    (b) In implementing a determination under subpart A (44 CFR 
352.6(d)), that Federal facilities and resources are necessary for 
emergency preparedness, FEMA shall take care not to supplant State and 
local resources. Federal facilities and resources shall be substituted 
for those of the State and local governments in the licensee offsite 
emergency response plan only to the extent necessary to compensate for 
the nonparticipation or inadequate participation of those governments, 
and only as a last resort after consultation with the Governor(s) and 
responsible local officials in the affected area(s) regarding State and 
local participation.
    (c) All Federal planning activities described in this subpart will 
be conducted under the assumption that, in the event of an actual 
radiological emergency or disaster, State and local authorities would 
contribute their full resources and exercise their authorities in 
accordance with their duties to protect the public from harm and would 
act, generally, in conformity with the licensee's offsite emergency 
response plan.



Sec. 352.26  Arrangements for Federal response in the licensee offsite emergency response plan.

    Federal agencies may be called upon to assist the licensee in 
developing a licensee offsite emergency response plan in areas such as:
    (a) Arrangements for use of Federal facilities and resources for 
response functions such as:
    (1) Prompt notification of the emergency to the public;
    (2) Assisting in any necessary evacuation;
    (3) Providing reception centers or shelters and related facilities 
and services for evacuees;
    (4) Providing emergency medical services at Federal hospitals; and
    (5) Ensuring the creation and maintenance of channels of 
communication from commercial nuclear power plant licensees to State and 
local governments and to surrounding members of the public.
    (b) Arrangements for transferring response functions to State and 
local governments during the response in an actual emergency; and
    (c) Arrangements which may be necessary for FEMA coordination of the 
response of other Federal agencies.



Sec. 352.27  Federal role in the emergency response.

    In addition to the Federal component of the licensee offsite 
emergency response plan described in subpart B (Sec. 352.26), and after 
complying with E.O. 12657, Section 2(b)(2), which states that FEMA:

    (2) Shall take care not to supplant State and local resources and 
that FEMA shall substitute its own resources for those of State and 
local governments only to the extent necessary to compensate for the 
nonparticipation or inadequate participation of those governments, and 
only as a last resort after appropriate consultation with the Governors 
and responsible local officials in the affected area regarding State and 
local participation;


FEMA shall provide for initial Federal response activities, including 
command and control of the offsite response, as may be needed. Any 
Federal response role, undertaken pursuant to this section, shall be 
transferred to State and

[[Page 606]]

local governments as soon as feasible after the onset of an actual 
emergency.



Sec. 352.28  Reimbursement.

    In accordance with Executive Order 12657, Section 6(d), and to the 
extent permitted by law, FEMA will coordinate full reimbursement, either 
jointly or severally, to the agencies performing services or furnishing 
resources, from any affected licensee and from any affected 
nonparticipating or inadequately participating State or local 
government.



Sec. 352.29  Appeal process.

    (a) Any interested party may appeal a determination made by the 
Associate Director, under Secs. 352.5 and 352.6 of this part, by 
submitting to the Director, FEMA, a written notice of appeal, within 30 
days after issuance. The appeal is to be addressed to the Director, 
Federal Emergency Management Agency, 500 C Street SW., Washington, DC 
20472. The appeal letter shall state the specific reasons for the appeal 
and include documentation to support appellant arguments. The appeal is 
limited to matters of record under Secs. 352.5 and 352.6.
    (b) Within 30 days of receipt of this letter, the FEMA Director or 
designee will review the record and make a final determination on the 
matter.
    (c) Copies of this determination shall be furnished to the 
Appellant, the State(s), affected local governments, and the NRC.
    (d) For purposes of this section, the term interested party means 
only a licensee, a State or a local government, as defined in 
Sec. 352.1(g).



PART 353--FEE FOR SERVICES IN SUPPORT, REVIEW AND APPROVAL OF STATE AND LOCAL GOVERNMENT OR LICENSEE RADIOLOGICAL EMERGENCY PLANS AND PREPAREDNESS--Table of Contents




Sec.
353.1  Purpose.
353.2  Scope.
353.3  Definitions.
353.4  Payment of fees.
353.5  Average cost per FEMA professional staff-hour.
353.6  Schedule of services.
353.7  Failure to pay.

Appendix A to Part 353--Memorandum of Understanding Between Federal 
          Emergency Management Agency and Nuclear Regulatory Commission

    Authority: 31 U.S.C. 9701; E.O. 12657 of Nov. 18, 1988; 3 CFR, 1988 
Comp., p. 611; 50 U.S.C. app. 2251 note; E.O. 12148 of July 20, 1979; 3 
CFR, 1979 Comp., p. 412, 50 U.S.C. app. 2251 note.

    Source: 56 FR 9455, March 6, 1991, unless otherwise noted.



Sec. 353.1  Purpose.

    This part sets out fees charged for site-specific radiological 
emergency planning and preparedness services rendered by the Federal 
Emergency Management Agency, as authorized by 31 U.S.C. 9701.



Sec. 353.2  Scope.

    The regulation in this part applies to all licensees who have 
applied for or have received a license from the Nuclear Regulatory 
Commission to operate a commercial nuclear power plant.



Sec. 353.3  Definitions.

    As used in this part, the following terms and concepts are defined:
    (a) FEMA means the Federal Emergency Management Agency.
    (b) NRC means the Nuclear Regulatory Commission.
    (c) Certification means the written justification by a licensee of 
the need for Federal compensatory assistance, as authorized in 44 CFR 
part 352 and E.O. 12657.
    (d) Technical assistance means services provided by FEMA to 
facilitate offsite radiological emergency planning and preparedness such 
as provision of support for the preparation of offsite radiological 
emergency response plans and procedures; provision of advice and 
recommendations for specific aspects of preparedness such as alert and 
notification and emergency public information.
    (e) Licensee means the utility which has applied for or has received 
a license from the NRC to operate a commercial nuclear power plant.
    (f) Governor means the Governor of a State or his/her designee.

[[Page 607]]

    (g) RAC means Regional Assistance Committee chaired by FEMA with 
representatives from the Nuclear Regulatory Commission, Environmental 
Protection Agency, Department of Health and Human Services, Department 
of Energy, Department of Agriculture, Department of Transportation, 
Department of Commerce and other Federal Departments and agencies as 
appropriate.
    (h) REP means FEMA's Radiological Emergency Preparedness Program.
    (i) Fiscal Year means Federal fiscal year commencing on the first 
day of October through the thirtieth day of September.
    (j) Federal Radiological Preparedness Coordinating Committee is the 
national level committee chaired by FEMA with representatives from the 
Nuclear Regulatory Commission, Environmental Protection Agency, 
Department of Health and Human Services, Department of Interior, 
Department of Energy, Department of Transportation, United States 
Department of Agriculture, Department of Commerce and other Federal 
Departments and agencies as appropriate.



Sec. 353.4  Payment of fees.

    Fees for site-specific offsite radiological emergency plans and 
preparedness services and related site-specific legal services are 
payable upon notification by FEMA. FEMA services will be billed at 6-
month intervals for all accumulated costs on a site-specific basis. Each 
bill will identify the costs related to services for each nuclear power 
plant site.



Sec. 353.5  Average cost per FEMA professional staff-hour.

    Fees for FEMA services rendered will be calculated based upon the 
costs for such services using a professional staff rate per hour 
equivalent to the sum of the average cost to the agency of maintaining a 
professional staff member performing site-specific services related to 
the Radiological Emergency Preparedness Program, including salary, 
benefits, administrative support, travel and overhead. This rate will be 
charged when FEMA performs such services as: Development of exercise 
objectives and scenarios, pre-exercise logistics, exercise conduct and 
participation, evaluation, meetings and reports; review and approval of 
Plan revisions that are utility-requested or exercise inadequacy 
related; remedial exercise, medical drill or any other exercise or drill 
upon which a license is predicated, with regard to preparation, review, 
conduct, participation, evaluation, meetings and reports; the issuance 
of interim findings pursuant to the FEMA/NRC Memorandum of Understanding 
(MOU) (App. A of this part); review of utility plan submissions through 
the NRC under the MOU; utility certification submission review under 44 
CFR part 352 and follow-on activities; site-specific adjudicatory 
proceedings and any other site-specific legal costs and technical 
assistance that is utility requested or exercise inadequacy related. The 
professional staff rate for FY 91 is $39.00 per hour. The referenced 
FEMA/NRC MOU is provided in this rule as appendix A. The professional 
staff rate for the REP Program and related legal services will be 
revised on a fiscal year basis using the most current fiscal data 
available and the revised hourly rate will be published as a notice in 
the Federal Register for each fiscal year if the rate increases or 
decreases.



Sec. 353.6  Schedule of services.

    Recipients shall be charged the full cost of site-specific services 
based upon the appropriate professional hourly staff rate for the FEMA 
services described in this Section and for related contractual services 
which will be charged to the licensee by FEMA, at the rate and cost 
incurred.
    (a) When a State seeks formal review and approval by FEMA of the 
State's radiological emergency response plan pursuant to 44 CFR part 350 
(Review and Approval Process of State and Local Radiological Emergency 
Plans and Preparedness), FEMA shall provide the services as described in 
44 CFR part 350 in regard to that request and fees will be charged for 
such services to the licensee, which is the ultimate beneficiary of FEMA 
services. This provision does not apply where an operating license has 
been granted or the application denied or withdrawn, except as necessary 
to support biennial exercises

[[Page 608]]

and related activities. Fees will be charged for all FEMA, but not other 
Federal agency activities related to such services, including but not 
limited to the following:
    (1) Development of exercise objectives and scenarios, preexercise 
logistics, exercise conduct and participation, evaluation, meetings and 
reports.
    (2) Review of plan revisions that are exercise-inadequacy related;
    (3) Technical assistance that is exercise-inadequacy related;
    (4) Remedial exercise, medical drill, or any other exercise or drill 
upon which maintenance of a license is predicated, with regard to 
preparation, review, conduct, participation, evaluation, meetings and 
reports.
    (b) Interim findings. Where the NRC seeks from FEMA under the FEMA/
NRC MOU an interim finding of the status of radiological emergency 
planning and preparedness at a particular time for a nuclear power 
plant, FEMA shall assess a fee to the licensee for providing this 
service. The provision of this service consists of making a 
determination whether the plans are adequate to protect the health and 
safety of the public living in the vicinity of the nuclear power 
facility by providing reasonable assurance that appropriate protective 
measures can be taken offsite in the event of a radiological emergency 
and that such plans are capable of being implemented.
    (c) NRC utility plan submissions. Fees will be charged for all FEMA 
but not other Federal agency activities related to such services, 
including but not limited to the following:
    (1) Development of exercise objectives and scenarios, preexercise 
logistics, exercise conduct and participation, evaluation and post-
exercise meetings and reports.
    (2) Notice and conduct of public meeting.
    (3) Regional finding and determination of adequacy of plans and 
preparedness followed by review by FEMA Headquarters resulting in final 
FEMA determination of adequacy of plans and preparedness,
    (4) Remedial exercise, medical drill, or any other exercise or drill 
upon which maintenance of a license is predicated, with regard to 
preparation, review, conduct, participation, evaluation, meetings and 
reports.
    (d) Utility certification submission review. When a licensee seeks 
Federal assistance within the framework of 44 CFR part 352 due to the 
decline or failure of a State or local government to adequately prepare 
an emergency plan, FEMA shall process the licensee's certification and 
make the determination whether a decline or fail situation exists. Fees 
will be charged for services rendered in making the determination. Upon 
the determination that a decline or fail situation does exist, any 
services provided or secured by FEMA consisting of assistance to the 
licensee, as described in 44 CFR part 352, will have a fee charged for 
such services.
    (e) FEMA participation in site-specific NRC adjudicatory proceedings 
and any other site-specific legal costs. Where FEMA participates in NRC 
licensing proceedings and any related court actions to support FEMA 
findings as a result of its review and approval of offsite emergency 
plans and preparedness, or provides legal support for any other site 
specific FEMA activities comprised in this rule, fees will be charged to 
the licensee for such participation.
    (f) Rendering technical assistance. Where FEMA is requested by a 
licensee to provide any technical assistance, or where a State or local 
government requests technical assistance in order to correct an 
inadequacy identified as a result of a biennial exercise or any other 
drill or exercise upon which maintenance of a license is predicated, 
FEMA will charge such assistance to the licensee for the provision of 
such service.



Sec. 353.7  Failure to pay.

    In any case where there is a dispute over the FEMA bill or where 
FEMA finds that a licensee has failed to pay a prescribed fee required 
under this part, procedures will be implemented in accordance with 44 
CFR part 11 subpart C to effectuate collections under the Debt 
Collection Act of 1982 (31 U.S.C. 3711 et seq.).

[[Page 609]]

  Appendix A to Part 353--Memorandum of Understanding Between Federal 
      Emergency Management Agency and Nuclear Regulatory Commission

    The Federal Emergency Management Agency (FEMA) and the Nuclear 
Regulatory Commission (NRC) have entered into a new Memorandum of 
Understanding (MOU) Relating To Radiological Emergency Planning and 
Preparedness. This supersedes a memorandum entered into on November 1, 
1980 (published December 16, 1980, 45 FR 82713), revised April 9, 1985 
(published April 18, 1985, 50 FR 15485), and published as Appendix A to 
44 CFR part 353. The substantive changes in the new MOU are: (1) Self-
initiated review by the NRC; (2) Early Site Permit process; (3) adoption 
of FEMA exercise time-frames; (4) incorporation of FEMA definition of 
exercise deficiency; (5) NRC commitment to work with licensees in 
support of State and local governments to correct exercise deficiencies; 
(6) correlation of FEMA actions on withdrawal of approvals under 44 CFR 
part 350 and NRC enforcement actions; and (7) disaster-initiated reviews 
in situations that affect offsite emergency infrastructures. The text of 
the MOU follows.

      Memorandum of Understanding Between NRC and FEMA Relating to 
            Radiological Emergency Planning and Preparedness

                       I. Background and Purposes

    This Memorandum of Understanding (MOU) establishes a framework of 
cooperation between the Federal Emergency Management Agency (FEMA) and 
the U.S. Nuclear Regulatory Commission (NRC) in radiological emergency 
response planning matters so that their mutual efforts will be directed 
toward more effective plans and related preparedness measures at and in 
the vicinity of nuclear reactors and fuel cycle facilities which are 
subject to 10 CFR part 50, appendix E, and certain other fuel cycle and 
materials licensees which have potential for significant accidental 
offsite radiological releases. The memorandum is responsive to the 
President's decision of December 7, 1979, that FEMA will take the lead 
in offsite planning and response, his request that NRC assist FEMA in 
carrying out this role, and the NRC's continuing statutory 
responsibility for the radiological health and safety of the public.
    On January 14, 1980, the two agencies entered into a ``Memorandum of 
Understanding Between NRC and FEMA to Accomplish a Prompt Improvement in 
Radiological Emergency Preparedness,'' that was responsive to the 
President's December 7, 1979, statement. A revised and updated 
Memorandum of Understanding became effective November 1, 1980. The MOU 
was further revised and updated on April 9, 1985. This MOU is a further 
revision to reflect the evolving relationship between NRC and FEMA and 
the experience gained in carrying out the provisions of the previous 
MOU's. This MOU supersedes these two earlier versions of the MOU.
    The general principles agreed to in the previous MOU's and 
reaffirmed in this MOU, are as follows: FEMA coordinates all Federal 
planning for the offsite impact of radiological emergencies and takes 
the lead for assessing offsite radiological emergency response plans 
1 and preparedness, makes findings and determinations as to 
the adequacy and capability of implementing offsite plans, and 
communicates those findings and determinations to the NRC. The NRC 
reviews those FEMA findings and determinations in conjunction with the 
NRC onsite findings for the purpose of making determinations on the 
overall state of emergency preparedness. These overall findings and 
determinations are used by NRC to make radiological health and safety 
decisions in the issuance of licenses and the continued operation of 
licensed plants to include taking enforcement actions as notices of 
violations, civil penalties, orders, or shutdown of operating reactors. 
This delineation of responsibilities avoids duplicative efforts by the 
NRC staff in offsite preparedness matters. However, if FEMA informs the 
NRC that an emergency, unforeseen contingency, or other reason would 
prevent FEMA from providing a requested finding in a reasonable time, 
then, in consultation with FEMA, the NRC might initiate its own review 
of offsite emergency preparedness.
---------------------------------------------------------------------------

    \1\ Assessments of offsite plans may be based on State and local 
government plans submitted to FEMA under its rule (44 CFR Part 350), and 
as noted in 44 CFR 350.3(f), may also be based on plans currently 
available to FEMA or furnished to FEMA through the NRC/FEMA Steering 
Committee.
---------------------------------------------------------------------------

    A separate MOU dated October 22, 1980, deals with NRC/FEMA 
cooperation and responsibilities in response to an actual or potential 
radiological emergency. Operations Response Procedures have been 
developed that implement the provisions of the Incident Response MOU. 
These documents are intended to be consistent with the Federal 
Radiological Emergency Response Plan which describes the relationships, 
roles, and responsibilities of Federal Agencies for responding to 
accidents involving peacetime nuclear emergencies. On December 1, 1991, 
the NRC and FEMA also concluded a separate MOU in support of Executive 
Order 12657 (FEMA Assistance in Emergency Preparedness Planning at 
Commercial Nuclear Power Plants).

[[Page 610]]

                  II. Authorities and Responsibilities

    FEMA-Executive Order 12148 charges the Director, FEMA, with the 
responsibility to ``* * * establish Federal policies for, and 
coordinate, all civil defense and civil emergency planning, management, 
mitigation, and assistance functions of Executive agencies'' (Section 2-
101) and ``* * * represent the President in working with State and local 
governments and the private sector to stimulate vigorous participation 
in civil emergency preparedness, mitigation, response, and recovery 
programs'' (Section 2-104.).
    On December 7, 1979, the President, in response to the 
recommendations of the Kemeny Commission on the Accident at Three Mile 
Island, directed that FEMA assume lead responsibility for all offsite 
nuclear emergency planning and response.
    Specifically, the FEMA responsibilities with respect to radiological 
emergency preparedness as they relate to NRC are:
    1. To take the lead in offsite emergency planning and to review and 
assess offsite emergency plans and preparedness for adequacy.
    2. To make findings and determinations as to whether offsite 
emergency plans are adequate and can be implemented (e.g., adequacy and 
maintenance of procedures, training, resources, staffing levels and 
qualifications, and equipment). Notwithstanding the procedures which are 
set forth in 44 CFR part 350 for requesting and reaching a FEMA 
administrative approval of State and local plans, findings, and 
determinations on the current status of emergency planning and 
preparedness around particular sites, referred to as interim findings, 
will be provided by FEMA for use as needed in the NRC licensing process. 
Such findings will be provided by FEMA on mutually agreed to schedules 
or on specific NRC request. The request and findings will normally be by 
written communications between the co-chairs of the NRC/FEMA Steering 
Committee. An interim finding provided under this arrangement will be an 
extension of FEMA's procedures for review and approval of offsite 
radiological emergency plans and preparedness set forth in 44 CFR part 
350. It will be based on the review of currently available plans and, if 
appropriate, joint exercise results related to a specific nuclear power 
plant site.
    If the review involves an application under 10 CFR part 52 for an 
early site permit, the NRC will forward to FEMA pertinent information 
provided by the applicant and consult with FEMA as to whether there is 
any significant impediment to the development of offsite emergency 
plans. As appropriate, depending upon the nature of information provided 
by the applicant, the NRC will also request that FEMA determine whether 
major features of offsite emergency plans submitted by the applicant are 
acceptable, or whether offsite emergency plans submitted by the 
applicant are adequate, as discussed below.
    An interim finding based only on the review of currently available 
offsite plans will include an assessment as to whether these plans are 
adequate when measured against the standards and criteria of NUREG-0654/
FEMA-REP-1, and, pending a demonstration through an exercise, whether 
there is reasonable assurance that the plans can be implemented. The 
finding will indicate one of the following conditions: (1) Plans are 
adequate and there is reasonable assurance that they can be implemented 
with only limited or no corrections needed; (2) plans are adequate, but 
before a determination can be made as to whether they can be 
implemented, corrections must be made to the plans or supporting 
measures must be demonstrated (e.g., adequacy and maintenance of 
procedures, training, resources, staffing levels and qualifications, and 
equipment) or (3) plans are inadequate and cannot be implemented until 
they are revised to correct deficiencies noted in the Federal review.
    If, in FEMA's view, the plans that are available are not completed 
or are not ready for review, FEMA will provide NRC with a status report 
delineating milestones for preparation of the plan by the offsite 
authorities as well as FEMA's actions to assist in timely development 
and review of the plans.
    An interim finding on preparedness will be based on review of 
currently available plans and joint exercise results and will include an 
assessment as to (1) whether offsite emergency plans are adequate as 
measured against the standards and criteria of NUREG-0654/FEMA-REP-1 and 
(2) whether the exercise(s) demonstrated that there is reasonable 
assurance that the plans can be implemented.
    An interim finding on preparedness will indicate one of the 
following conditions: (1) There is reasonable assurance that the plans 
are adequate and can be implemented as demonstrated in an exercise; (2) 
there are deficiencies that must be corrected; or (3) FEMA is undecided 
and will provide a schedule of actions leading to a decision.
    3. To assume responsibility, as a supplement to State, local, and 
utility efforts, for radiological emergency preparedness training of 
State and local officials.
    4. To develop and issue an updated series of interagency assignments 
which delineate respective agency capabilities and responsibilities and 
define procedures for coordination and direction for emergency planning 
and response. [Current assignments are in 44 CFR part 351, March 11, 
1982. (47 FR 10758)]
    NRC-The Atomic Energy Act of 1954, as amended, requires that the NRC 
grant licenses only if the health and safety of the public is adequately 
protected. While the

[[Page 611]]

Atomic Energy Act does not specifically require emergency plans and 
related preparedness measures, the NRC requires consideration of overall 
emergency preparedness as a part of the licensing process. The NRC rules 
(10 CFR 50.33, 50.34, 50.47, 50.54, and appendix E to 10 CFR part 50, 
and 10 CFR part 52) include requirements for the licensee's emergency 
plans.
    Specifically, the NRC responsibilities for radiological emergency 
preparedness are:
    1. To assess licensee emergency plans for adequacy. This review will 
include organizations with whom licensees have written agreements to 
provide onsite support services under emergency conditions.
    2. To verify that licensee emergency plans are adequately 
implemented (e.g., adequacy and maintenance of procedures, training, 
resources, staffing levels and qualifications, and equipment).
    3. To review the FEMA findings and determinations as to whether 
offsite plans are adequate and can be implemented.
    4. To make radiological health and safety decisions with regard to 
the overall state of emergency preparedness (i.e., integration of 
emergency preparedness onsite as determined by the NRC and offsite as 
determined by FEMA and reviewed by NRC) such as assurance for continued 
operation, for issuance of operating licenses, or for taking enforcement 
actions, such as notices of violations, civil penalties, orders, or 
shutdown of operating reactors.

                        III. Areas of Cooperation

                        A. NRC Licensing Reviews

    FEMA will provide support to the NRC for licensing reviews related 
to reactors, fuel facilities, and materials licensees with regard to the 
assessment of the adequacy of offsite radiological emergency response 
plans and preparedness. This will include timely submittal of an 
evaluation suitable for inclusion in NRC safety evaluation reports.
    Substantially prior to the time that a FEMA evaluation is required 
with regard to fuel facility or materials license review, NRC will 
identify those fuel and materials licensees with potential for 
significant accidental offsite radiological releases and transmit a 
request for review to FEMA as the emergency plans are completed.
    FEMA routine support will include providing assessments, findings 
and determinations (interim and final) on offsite plans and preparedness 
related to reactor license reviews. To support its findings and 
determinations, FEMA will make expert witnesses available before the 
Commission, the NRC Advisory Committee on Reactor Safeguards, NRC 
hearing boards and administrative law judges, for any court actions, and 
during any related discovery proceedings.
    FEMA will appear in NRC licensing proceedings as part of the 
presentation of the NRC staff. FEMA counsel will normally present FEMA 
witnesses and be permitted, at the discretion of the NRC licensing 
board, to cross-examine the witnesses of parties, other than the NRC 
witnesses, on matters involving FEMA findings and determinations, 
policies, or operations; however, FEMA will not be asked to testify on 
status reports. FEMA is not a party to NRC proceedings and, therefore, 
is not subject to formal discovery requirements placed upon parties to 
NRC proceedings. Consistent with available resources, however, FEMA will 
respond informally to discovery requests by parties. Specific assignment 
of professional responsibilities between NRC and FEMA counsel will be 
primarily the responsibility of the attorneys assigned to a particular 
case. In situations where questions of professional responsibility 
cannot be resolved by the attorneys assigned, resolution of any 
differences will be made by the General Counsel of FEMA and the General 
Counsel of the NRC or their designees. NRC will request the presiding 
Board to place FEMA on the service list for all litigation in which it 
is expected to participate.
    Nothing in this MOU shall be construed in any way to diminish NRC's 
responsibility for protecting the radiological health and safety of the 
public.

            B. FEMA Review of Offsite Plans and Preparedness

    NRC will assist in the development and review of offsite plans and 
preparedness through its membership on the Regional Assistance 
Committees (RAC). FEMA will chair the Regional Assistance Committees. 
Consistent with NRC's statutory responsibility, NRC will recognize FEMA 
as the interface with State and local governments for interpreting 
offsite radiological emergency planning and preparedness criteria as 
they affect those governments and for reporting to those governments the 
results of any evaluation of their radiological emergency plans and 
preparedness.
    Where questions arise concerning the interpretation of the criteria, 
such questions will continue to be referred to FEMA Headquarters, and 
when appropriate, to the NRC/FEMA Steering Committee to assure uniform 
interpretation.

          C. Preparation for and Evaluation of Joint Exercises

    FEMA and NRC will cooperate in determining exercise requirements for 
licensees, and State and local governments. They will also jointly 
observe and evaluate exercises. NRC and FEMA will institute procedures 
to enhance the review of objectives and scenarios for joint exercises. 
This review is to

[[Page 612]]

assure that both the onsite considerations of NRC and the offsite 
considerations of FEMA are adequately addressed and integrated in a 
manner that will provide for a technically sound exercise upon which an 
assessment of preparedness capabilities can be based. The NRC/FEMA 
procedures will provide for the availability of exercise objectives and 
scenarios sufficiently in advance of scheduled exercises to allow enough 
time for adequate review by NRC and FEMA and correction of any 
deficiencies by the licensee. The failure of a licensee to develop a 
scenario that adequately addresses both onsite and offsite 
considerations may result in NRC taking enforcement actions.
    The FEMA reports will be a part of an interim finding on emergency 
preparedness; or will be the result of an exercise conducted pursuant to 
FEMA's review and approval procedures under 44 CFR part 350 and NRC's 
requirement under 10 CFR part 50, appendix E, Section IV.F. Exercise 
evaluations will identify one of the following conditions: (1) There is 
reasonable assurance that the plans are adequate and can be implemented 
as demonstrated in the exercise; (2) there are deficiencies that must be 
corrected; or (3) FEMA is undecided and will provide a schedule of 
actions leading to a decision. The schedule for issuance of the draft 
and final exercise reports will be as shown in FEMA-REP-14 (Radiological 
Emergency Preparedness Exercise Manual).
    The deficiency referred to in (2) above is defined as an observed or 
identified inadequacy of organizational performance in an exercise that 
could cause a finding that offsite emergency preparedness is not 
adequate to provide reasonable assurance that appropriate protective 
measures can be taken in the event of a radiological emergency to 
protect the health and safety of the public living in the vicinity of a 
nuclear power plant. Because of the potential impact of deficiencies on 
emergency preparedness, they should be corrected within 120 days through 
appropriate remedial actions, including remedial exercises, drills, or 
other actions.
    Where there are deficiencies of the types noted above, and when 
there is a potential for remedial actions, FEMA Headquarters will 
promptly (1-2 days) discuss these with NRC Headquarters. Within 10 days 
of the exercise, official notification of identified deficiencies will 
be made by FEMA to the State, NRC Headquarters, and the RAC with an 
information copy to the licensee. NRC will formally notify the licensee 
of the deficiencies and monitor the licensee's efforts to work with 
State and local authorities to correct the deficiencies. Approximately 
60 days after official notification of the deficiency, the NRC, in 
consultation with FEMA, will assess the progress being made toward 
resolution of the deficiencies.

              D. Withdrawal of Reasonable Assurance Finding

    If FEMA determines under 44 CFR 350.13 of its regulations that 
offsite emergency plans or preparedness are not adequate to provide 
reasonable assurance that appropriate protective measures can be taken 
in the event of radiological emergency to protect the health and safety 
of the public, FEMA shall, as described in its rule, withdraw approval.
    Upon receiving notification of such action from FEMA, the NRC will 
promptly review FEMA's findings and determinations and formally document 
the NRC's position. When, as described in 10 CFR 50.54(s)(2)(ii) and 
50.54(s)(3) of its regulations, the NRC finds the state of emergency 
preparedness does not provide reasonable assurance that adequate 
protective measures can and will be taken in the event of a radiological 
emergency, the NRC will notify the affected licensee accordingly and 
start the ``120-day clock.'' 2
---------------------------------------------------------------------------

    \2\ Per 10 CFR 50.54(s)(2)(ii), the Commission will determine 
whether the reactor shall be shut down or other appropriate enforcement 
actions if such conditions are not corrected within four months. The NRC 
is not limited by this provision of the rule, for, as stated in 10 CFR 
50.54(s)(3), ``Nothing in this paragraph shall be construed as limiting 
the authority of the Commission to take action under any other 
regulation or authority of the Commission or at any time other than that 
specified in this paragraph'' (emphasis added).
---------------------------------------------------------------------------

             E. Emergency Planning and Preparedness Guidance

    NRC has lead responsibility for the development of emergency 
planning and preparedness guidance for licensees. FEMA has lead 
responsibility for the development of radiological emergency planning 
and preparedness guidance for State and local agencies. NRC and FEMA 
recognize the need for an integrated, coordinated approach to 
radiological emergency planning and preparedness by NRC licensees and 
State and local governments. NRC and FEMA will each, therefore, provide 
opportunity for the other agency to review and comment on such guidance 
(including interpretations of agreed joint guidance) prior to adoption 
as formal agency guidance.

                F. Support for Document Management System

    FEMA and NRC will each provide the other with continued access to 
those automatic data processing support systems which contain relevant 
emergency preparedness data.

[[Page 613]]

            G. Ongoing NRC Research and Development Programs

    Ongoing NRC and FEMA research and development programs that are 
related to State and local radiological emergency planning and 
preparedness will be coordinated. NRC and FEMA will each provide 
opportunity for the other agency to review and comment on relevant 
research and development programs prior to implementing them.

              H. Public Information and Education Programs

    FEMA will take the lead in developing public information and 
educational programs. NRC will assist FEMA by reviewing for accuracy 
educational materials concerning radiation, and its hazards and 
information regarding appropriate actions to be taken by the general 
public in the event of an accident involving radioactive materials.

   I. Recovery from Disasters Affecting Offsite Emergency Preparedness

    Disasters that destroy roads, buildings, communications, 
transportation resources or other offsite infrastructure in the vicinity 
of a nuclear power plant can degrade the capabilities of offsite 
response organizations in the 10-mile plume emergency planning zone. 
Examples of events that could cause such devastation are hurricanes, 
tornadoes, earthquakes, tsunamis, volcanic eruptions, major fires, large 
explosions, and riots.
    If a disaster damages the area around a licensed operating nuclear 
power plant to an extent that FEMA seriously questions the continued 
adequacy of offsite emergency preparedness, FEMA will inform the NRC 
promptly. Likewise, the NRC will inform FEMA promptly of any information 
it receives from licensees, its inspectors, or others, that raises 
serious questions about the continued adequacy of offsite emergency 
preparedness. If FEMA concludes that a disaster-initiated review of 
offsite radiological emergency preparedness is necessary to determine if 
offsite emergency preparedness is still adequate, it will inform the NRC 
in writing, as soon as practicable, including a schedule for conduct of 
the review. FEMA will also give the NRC (1) interim written reports of 
its findings, as appropriate, and (2) a final written report on the 
results of its review.
    The disaster-initiated review is performed to reaffirm the 
radiological emergency preparedness capabilities of affected offsite 
jurisdictions located in the 10-mile emergency planning zone and is not 
intended to be a comprehensive review of offsite plans and preparedness.
    The NRC will consider information provided by FEMA Headquarters and 
pertinent findings from FEMA's disaster-initiated review in making 
decisions regarding the restart or continued operation of an affected 
operating nuclear power reactor. The NRC will notify FEMA Headquarters, 
in writing, of the schedule for restart of an affected reactor and keep 
FEMA Headquarters informed of changes in that schedule.

                     IV. NRC/FEMA Steering Committee

    The NRC/FEMA Steering Committee on Emergency Preparedness will 
continue to be the focal point for coordination of emergency planning 
and preparedness. As discussed in Section I of this agreement, response 
activities between these two agencies are addressed in a separate MOU. 
The Steering Committee will consist of an equal number of members to 
represent each agency with one vote per agency. When the Steering 
Committee cannot agree on the resolution of an issue, the issue will be 
referred to NRC and FEMA management. The NRC members will have lead 
responsibility for licensee planning and preparedness and the FEMA 
members will have lead responsibility for offsite planning and 
preparedness. The Steering Committee will assure coordination of plans 
and preparedness evaluation activities and revise, as necessary, 
acceptance criteria for licensee, State and local radiological emergency 
planning and preparedness. NRC and FEMA will then consider and adopt 
criteria, as appropriate, in their respective jurisdictions. (See 
Attachment 1).

                         V. Working Arrangements

    A. The normal point of contact for implementation of the points in 
this MOU will be the NRC/FEMA Steering Committee.
    B. The Steering Committee will establish the day-to-day procedures 
for assuring that the arrangements of this MOU are carried out.

                     VI. Memorandum of Understanding

    A. This MOU shall be effective as of date of signature and shall 
continue in effect unless terminated by either party upon 30 days notice 
in writing.
    B. Amendments or modifications to this MOU may be made upon written 
agreement by both parties.

    Approved for the U.S. Nuclear Regulatory Commission.

    Dated: June 17, 1993.

James M. Taylor,

    Executive Director for Operations.
    Dated: June 17, 1993.

    Approved for the Federal Emergency Management Agency.

Richard W. Krimm,
    Acting Associate Director, State and Local Programs and Support.

[[Page 614]]

                Attachment 1--FEMA/NRC Steering Committee

                                 Purpose

    Assure coordination of efforts to maintain and improve emergency 
planning and preparedness for nuclear power reactors as described in the 
NRC and FEMA rules and the NRC/FEMA MOU on Radiological Emergency 
Planning and Preparedness. Coordinate consistent criteria for licensee, 
State and local emergency plans and preparedness.

                               Membership

    The NRC and FEMA consignees of this MOU will designate respective 
co-chairs for the Steering Committee. The designated co-chairs will, in 
turn, appoint their respective members to the Committee.

                           Membership Changes

    Changes to the membership of the NRC/FEMA Steering Committee may be 
made by the co-chairs representing the agency whose member is being 
changed.

                          Operating Procedures

    The Steering Committee will maintain a record of each meeting to 
include identification of issues discussed and conclusions reached. No 
meeting will be held without the attendance and participation of at 
least the co-chairs or two assigned members of each agency.

                              Coordination

    When items involving responsibilities of other NRC or FEMA offices 
are discussed, the affected offices will be contacted as appropriate.

[58 FR 47997, Sept. 14, 1993]



PART 354--FEE FOR SERVICES TO SUPPORT FEMA'S OFFSITE RADIOLOGICAL EMERGENCY PREPAREDNESS PROGRAM--Table of Contents




Sec.
354.1  Purpose.
354.2  Scope.
354.3  Definitions.
354.4  Assessment of fees.
354.5  Description of services.
354.6  Billing and payment of fees.
354.7  Failure to pay.

    Authority: Sec. 109, Pub. L. 96-295, 94 Stat. 780; sec. 2901, Pub. 
L. 98-369, 98 Stat. 494; Title III, Pub. L. 103-327, 108 Stat. 2323-
2325; EO 12148; 3 CFR, 1979 Comp., p. 412 (50 U.S.C. app. 2251 note); EO 
12657, 3 CFR, 1988 Comp., p. 611.

    Source: 60 FR 15632, Mar. 24, 1995, unless otherwise noted.



Sec. 354.1  Purpose.

    This part establishes the methodology for FEMA to assess and collect 
user fees from Nuclear Regulatory Commission (NRC) licensees of 
commercial nuclear power plants to recover at least 100 percent of the 
amounts anticipated by FEMA to be obligated for its Radiological 
Emergency Preparedness (REP) Program as authorized under Title III, 
Public Law 103-327, 108 Stat. 2323-2325. As stipulated by Public Law 
103-327, the methodology for assessment and collection of fees shall be 
fair and equitable, and shall reflect the full amount of costs of 
providing radiological emergency planning, preparedness, response and 
associated services. Such fees will be assessed in a manner that 
reflects the use of agency resources for classes of regulated persons 
and the administrative costs of collecting such fees. Fees received 
pursuant to this section shall be deposited in the general fund of the 
Treasury as offsetting receipts. Assessment and collection of such fees 
are only authorized during fiscal year (FY) 1995.



Sec. 354.2  Scope.

    The regulation in this part applies to all persons or licensees who 
have applied for or have received from the NRC:
    (a) A license to construct or operate a commercial nuclear power 
plant;
    (b) A possession-only license for a commercial nuclear power plant, 
with the exception of licensees that have received an NRC-approved 
exemption to 10 CFR 50.54(q) requirements;
    (c) An early site permit for a commercial nuclear power plant;
    (d) A combined construction permit and operating license for a 
commercial nuclear power plant; or
    (e) Any other NRC licensee that is now or may become subject to 
requirements for offsite radiological emergency planning and 
preparedness.



Sec. 354.3  Definitions.

    As used in this part, the following terms and concepts are defined:
    (a) FEMA means the Federal Emergency Management Agency.
    (b) NRC means the U. S. Nuclear Regulatory Commission.

[[Page 615]]

    (c) Technical assistance means services provided by FEMA to 
accomplish offsite radiological emergency planning, preparedness and 
response, including but not limited to, provision of support for the 
preparation of offsite radiological emergency response plans and 
procedures, and provision of advice and recommendations for specific 
aspects of radiological emergency planning, preparedness and response, 
such as alert and notification and emergency public information.
    (d) Persons or Licensee means the utility or organization that has 
applied for or has received from the NRC:
    (1) A license to construct or operate a commercial nuclear power 
plant;
    (2) A possession-only license for a commercial nuclear power plant, 
with the exception of licensees that have received an NRC-approved 
exemption to 10 CFR 50.54(q) requirements;
    (3) An early site permit for a commercial nuclear power plant;
    (4) A combined construction permit and operating license for a 
commercial nuclear power plant; or
    (5) Any other NRC license that is now or may become subject to 
requirements for offsite radiological emergency planning and 
preparedness activities.
    (e) RAC means Regional Assistance Committee chaired by FEMA with 
representatives from the Nuclear Regulatory Commission, Environmental 
Protection Agency, Department of Health and Human Services, Department 
of Energy, Department of Agriculture, Department of Transportation, 
Department of Commerce, Department of Interior, and other Federal 
departments and agencies as appropriate.
    (f) REP means Radiological Emergency Preparedness as in FEMA's REP 
Program.
    (g) Fiscal Year means the Federal fiscal year commencing on the 
first day of October through the thirtieth day of September.
    (h) Federal Radiological Preparedness Coordinating Committee (FRPCC) 
means a committee chaired by FEMA with representatives from the Nuclear 
Regulatory Commission, Environmental Protection Agency, Department of 
Health and Human Services, Department of Interior, Department of Energy, 
Department of Transportation, Department of Agriculture, Department of 
Commerce, Department of State, Department of Veterans Affairs, General 
Services Administration, National Communications System, the National 
Aeronautics and Space Administration and other Federal departments and 
agencies as appropriate.
    (i) Site means the location at which one or more commercial nuclear 
power plants (reactor units) have been, or are planned to be, 
constructed.
    (j) Site-specific services mean offsite radiological emergency 
planning, preparedness and response services provided by FEMA personnel 
and by FEMA contractors that pertain to a specific commercial nuclear 
power plant site.
    (k) EPZ means emergency planning zone.
    (l) Plume pathway EPZ means for planning purposes, the area within 
approximately a 10-mile radius of a nuclear plant site.
    (m) Biennial exercise means the joint licensee/State and local 
government exercise, evaluated by FEMA, conducted around a commercial 
nuclear power plant site once every two years in conformance with 44 CFR 
part 350.
    (n) Obligate or obligation means a legal reservation of appropriated 
funds for expenditure.



Sec. 354.4  Assessment of fees.

    Assessment of user fees from licensees is based on a methodology 
that includes charges for REP Program services provided by both FEMA 
personnel and FEMA contractors. Beginning with FY 1995, a four year 
cycle is established with predetermined user fee assessments which will 
be collected each year of the cycle. The assessments will initially be 
at the level indicated in the FY 1995 bills and, as described in 
paragraphs (b) and (d) of this section, for the remainder of the four 
year cycle, as authorized. The initial four year cycle will run from FY 
1995-1998. The following four year cycle will run from FY 1999-2003. 
Fees will be assessed only for REP Program services provided by FEMA 
personnel and by FEMA contractors and not for those services provided by 
other Federal agencies involved in the FRPCC or the RACs.

[[Page 616]]

    (a) Description of fee components. The fee for each site consists of 
two distinct components:
    (1) A site-specific, biennial exercise-related component to recover 
the portion of the REP program budget associated only with plume pathway 
emergency planning zone (EPZ) biennial exercise-related activities.
    (2) A flat fee component that is the same for each site and recovers 
the remaining portion of the REP Program budgeted funding which does not 
include biennial exercise-related activities.
    (b) Determination of site-specific, biennial exercise-related 
component for FEMA personnel. An average biennial exercise-related cost 
for FEMA personnel has been determined for each commercial nuclear power 
plant site in the REP Program. This cost, which has been annualized 
(dividing the average biennial exercise-related cost by two), is based 
on the average number of hours expended by FEMA personnel in REP 
exercise-related activities for each site. The average number of hours 
has been determined based on an analysis of site-specific exercise 
activity expended since the inception of FEMA's user fee program (1991). 
The actual user fee assessment for this component is determined by 
multiplying the average number of REP exercise-related hours, which has 
been determined and annualized for each site, by the average hourly rate 
for a REP Program employee in effect for the fiscal year. In FY 1995, 
the hourly rate has been determined to be $29.34 by the Chief Financial 
Officer of FEMA. The hourly rate will be revised annually to reflect 
actual budget and cost of living factors, but the number of site-
specific exercise hours, as annualized, will remain constant for user 
fee calculations and assessments throughout the four year cycle, e.g., 
FY 1995-1998. Exercise activity will continue to be tracked and 
monitored during the initial and subsequent four year cycles. 
Appropriate adjustments will be made to this component for calculation 
of user fee assessments during subsequent four year cycles.
    (c) Determination of site-specific, biennial exercise-related 
component for FEMA contract personnel. An average biennial exercise-
related cost for REP contractors has been determined for each commercial 
nuclear power plant site in the REP Program. This cost, which has been 
annualized (dividing the average biennial exercise-related cost by two), 
is based on the average costs of contract personnel in REP site-specific 
exercise-related activities since the inception of FEMA's user fee 
program (1991). Exercise activity will continue to be tracked and 
monitored during the initial and subsequent four year cycles. 
Appropriate adjustments will be made to this component for calculation 
of user fee assessments during subsequent four year cycles.
    (d) Determination of flat fee component. For each year of the four 
year cycle, the remainder of REP Program budgeted funds is recovered as 
a flat fee component. Specifically, the flat fee component is determined 
by subtracting the total of the FEMA personnel and contractor site-
specific, biennial exercise-related components, as outlined in 
paragraphs (b) and (c) of this section, from the total REP budget for 
that fiscal year. The resulting amount is equally divided among the 
total number of licensed commercial nuclear power plant sites as defined 
under Sec. 354.2, Scope, to arrive at each site's flat fee component for 
that fiscal year.
    (e) Discontinuation of Charges. Upon receipt of a copy from the NRC 
of the NRC-approved exemption to 10 CFR 50.54(q) requirements stating 
that offsite radiological emergency planning and preparedness is no 
longer required at a particular commercial nuclear power plant site, 
FEMA will discontinue REP Program services. Commencing at the beginning 
of the next fiscal year, a user fee will no longer be assessed for that 
site.



Sec. 354.5  Description of services.

    Site-specific and other REP Program services provided by FEMA and 
FEMA contractors for which licensees would be assessed fees include, but 
are not limited to, the following:
    (a) Site-specific, plume pathway EPZ biennial exercise-related 
component services. (1) Scheduling of plume pathway EPZ biennial 
exercises.

[[Page 617]]

    (2) Review of plume pathway EPZ biennial exercise objectives and 
scenarios.
    (3) Pre-plume pathway EPZ biennial exercise logistics.
    (4) Conduct of plume pathway EPZ biennial exercises, evaluations, 
and post exercise briefings.
    (5) Preparing, reviewing and finalizing plume pathway EPZ biennial 
exercise reports, notice and conduct of public meetings.
    (6) Activities related to Medical Services and other drills 
conducted in support of a biennial, plume pathway exercise.
    (b) Flat fee component services. (1) Evaluation of State and local 
offsite radiological emergency plans and preparedness.
    (2) Scheduling of other than plume pathway EPZ biennial exercises.
    (3) Development of other than plume pathway EPZ biennial exercise 
objectives and scenarios.
    (4) Pre-other than plume pathway EPZ biennial exercise logistics.
    (5) Conduct of other than plume pathway EPZ biennial exercises and 
evaluations.
    (6) Preparing, reviewing and finalizing other than plume pathway EPZ 
biennial exercise reports, notice and conduct of public meetings.
    (7) Preparation of findings and determinations on the adequacy or 
approval of plans and preparedness.
    (8) Conduct of the formal 44 CFR part 350 review process.
    (9) Providing technical assistance to States and local governments.
    (10) Review of licensee submissions pursuant to 44 CFR part 352.
    (11) Review of NRC licensee offsite plan submissions under the NRC/
FEMA Memorandum of Understanding on Planning and Preparedness, and 
NUREG-0654/FEMA-REP-1, Revision 1, Supplement 1. Copies of the NUREG-
0654 may be obtained from the Superintendent of Documents, P.O. Box 
371954, Pittsburgh, PA 15250-7954.
    (12) Participation in NRC adjudicatory proceedings and any other 
site-specific legal forums.
    (13) Alert and notification system reviews.
    (14) Responses to petitions filed under 10 CFR 2.206.
    (15) Disaster-initiated reviews and evaluations.
    (16) Congressionally-initiated reviews and evaluations.
    (17) Responses to licensee's challenges to FEMA's administration of 
the fee program.
    (18) Response to actual radiological emergencies.
    (19) Development of regulations, guidance, planning standards and 
policy.
    (20) Coordination with other Federal agencies to enhance the 
preparedness of State and local governments for radiological 
emergencies.
    (21) Coordination of REP Program issues with constituent 
organizations such as the National Emergency Management Association, 
Conference of Radiation Control Program Directors, and the Nuclear 
Energy Institute.
    (22) Implementation and coordination of REP Program training with 
FEMA's Emergency Management Institute (EMI) to assure effective 
development and implementation of REP training courses and conferences.
    (23) Participation of REP personnel as lecturers or to perform other 
functions at EMI, conferences and workshops.
    (24) Services associated with the assessment of fees, billing, and 
administration of this part.



Sec. 354.6  Billing and payment of fees.

    FEMA will forward bills to licensees based on the assessment 
methodology set forth in Sec. 354.4 to recover the full amount of the 
funds budgeted by FEMA to provide REP Program services. Licensees with 
multiple sites will receive consolidated bills. FEMA will forward one 
bill to each licensee during the first quarter of the fiscal year, with 
payment due within 30 days. If minor adjustments are necessary due to 
FEMA exceeding its original budget for the fiscal year, the adjustment 
will appear in the bill for the subsequent fiscal year.



Sec. 354.7  Failure to pay.

    In any case where FEMA believes that a licensee has failed to pay a 
prescribed fee required under this part, procedures will be implemented 
in accordance with 44 CFR part 11, subpart

[[Page 618]]

C, to effectuate collections under the Debt Collection Act of 1982 (31 
U.S.C. 3711 et seq.).



PARTS 355-359  [RESERVED]






PART 360--STATE ASSISTANCE PROGRAMS FOR TRAINING AND EDUCATION IN COMPREHENSIVE EMERGENCY MANAGEMENT--Table of Contents




Sec.
360.1  Purpose.
360.2  Description of program.
360.3  Eligible applicants.
360.4  Administrative procedures.
360.5  General provisions for State Cooperative Agreement.

    Authority: Reorganization Plan No. 3 (3 CFR, 1978 Comp., p. 329); 
E.O. 12127 (44 FR 19367); E.O. 12148 (44 FR 43239).

    Source: 46 FR 1271, Jan. 6, 1981, unless otherwise noted.



Sec. 360.1  Purpose.

    The Emergency Management Training Program is designed to enhance the 
States' emergency management training program to increase State 
capabilities and those of local governments in this field, as well as to 
give States the opportunity to develop new capabilities and techniques. 
The Program is an ongoing intergovernmental endeavor which combines 
financial and human resources to fill the unique training needs of local 
government, State emergency staffs and State agencies, as well as the 
general public. States will have the opportunity to develop, implement 
and evaluate various approaches to accomplish FEMA emergency objectives 
as well as goals and objectives of their own. The intended result is an 
enhanced capability to protect lives and property through planning, 
mitigation, operational skill, and rapid response in case of disaster or 
attack on this country.



Sec. 360.2  Description of program.

    (a) The program is designed for all States regardless of their 
present level of involvement in training or their degree of expertise in 
originating and presenting training courses in the past. The needs of 
individual States, difference in numbers to be trained, and levels of 
sophistication in any previous training program have been recognized. It 
is thus believed that all States are best able to meet their own unique 
situations and those of local government by being given this opportunity 
and flexibility.
    (b) Each State is asked to submit an acceptable application, to be 
accompanied by a Training and Education (T&E) plan for a total of 
three years, only the first year of which will be required to be 
detailed. The remaining two year program should be presented in terms of 
ongoing training objectives and programs. In the first year plan 
applicants shall delineate their objectives in training and education, 
including a description of the programs to be offered, and identify the 
audiences and numbers to be trained. Additionally, the State is asked to 
note the month in which the activity is to be presented, the location, 
and cost estimates including instructional costs and participant's 
travel and per diem. These specifics of date, place, and costs will be 
required for the first year of any three year plan. A three year plan 
will be submitted each year with an application. Each negotiated 
agreement will include a section of required training (Radiological 
Defense), and a section including optional courses to be conducted in 
response to State and local needs.
    (c) FEMA support to the States in their training program for State 
and local officials, has been designed around three Program elements. 
Each activity listed in the State Training and Education (T&E) Plan 
will be derived from the following three elements:
    (1) Government Conducted Courses: Such courses require the least 
capability on the part of the State. They are usually conducted through 
provisions in a FEMA Regional Support Contract and/or FEMA or other 
Federal agency staff. The State's responsibilities fall primarily into 
administrative areas of recruiting participants, making all arrangements 
for the facilities needed for presentation of the course, and the 
handling of the cost reimbursement to participants, though State staff 
may participate as instructors. These courses for example include:

[[Page 619]]

    (i) Career Development Courses: Phases I, II, and III,
    (ii) Radiological Officer and Instructor Courses,
    (iii) Technical Workshops on Disaster Recovery or Hazard Mitigation.
    (2) Government and recipient conducted courses: Responsibilities in 
these courses fall jointly upon Federal and State government as agreed 
in the planning for the course. Courses in this category might include:
    (i) Emergency Management Workshops,
    (ii) Multijurisdictional Emergency Operations Simulation Training.

In this category also, it is expected that the State will be responsible 
for administrative and logistical requirements, plus any instructional 
activity as agreed upon prior to the conduct of the course.
    (3) Recipient conducted courses: This element requires the greatest 
degree of sophistication in program planning and delivery on the part of 
the State. Training events proposed by the State must be justified as 
addressing Emergency Management Training Program objectives. 
Additionally, they must address State or community needs and indicate 
the State's ability to present and carry out the Program of Instruction. 
Courses in this category could include:
    (i) Radiological Monitoring,
    (ii) Emergency Operations Simulating Training,
    (iii) Shelter Management.
    (d) In order that this three year comprehensive Training and 
Education Program planning can proceed in a timely and logical manner, 
each State will be provided three target appropriation figures, one for 
each of the three program years. States will develop their proposals, 
using the target figure to develop their scope of work. Adjustments in 
funding and the scope of work will be subject to negotiation before 
finalization. Both the funding and the scope of work will be reviewed 
each year and adjustments in the out years will reflect increased 
sophistication and expertise of the States as well as changing training 
needs within each State.
    (e)(1) FEMA funding through the State Cooperative Agreement for the 
training activities is to be used for travel and per diem expenses of 
students selected by the States for courses reflecting individually 
needed or required training. Additionally funds may be expended for 
course materials and instructor expenses. The funding provided in the 
State Cooperative Agreement is not for the purpose of conducting ongoing 
State activities or for funding staff positions to accomplish work to be 
performed under this Agreement. Nor is the Agreement for the purpose of 
purchasing equipment which may be obtained with the help of Personnel 
and Administrative funds. In cases where equipment has been identified 
as needed in the scope of work submitted with the application, and where 
it serves as an outreach to a new audience or methodology, equipment 
purchase may be approved at the time of initial application approval.
    (2) Allowable cost will be funded at 100%.

[46 FR 1271, Jan. 6, 1981, as amended at 48 FR 9646, Mar. 8, 1983]



Sec. 360.3  Eligible applicants.

    Each of the 50 States, independent commonwealths, and territories is 
eligible to participate in a State Cooperative Agreement with FEMA. The 
department, division, or agency of the State government assigned the 
responsibility for State training in comprehensive emergency management 
should file the application.



Sec. 360.4  Administrative procedures.

    (a) Award. Each State desiring to participate will negotiate the 
amount of financial support for the training and education program. 
Deciding factors will be the scope of the program, a prudent budget, the 
number of individuals to be trained, and variety of audiences included 
which are in need of training. All these factors are part of the 
required application as discussed in Sec. 360.2.
    (b) Period of agreement. Agreements will be negotiated annually and 
will be in effect for a period of 12 months. Each agreement, however, 
will include a scope of work for three years as reflected in 
Sec. 360.2(b) to give continuity to the total training and education 
program.

[[Page 620]]

    (c) Submission procedure. Each State applicant shall comply with the 
following procedures:
    (1) Issuance of a request for application: Each State emergency 
management agency will receive a Request for Application Package from 
the State's respective FEMA Regional Director.
    (2) How to submit: Each State shall submit the completed application 
package to the Regional Director of the Appropriate Region.
    (3) Application package: The Application Package should include:
    (i) A transmittal letter signed by the State Director of the agency 
tasked with emergency management responsibilities for that State.
    (ii) A three year projected training and education scope of work 
including both ``required'' training and ``optional'' courses. The first 
of the projected three year program is to be detailed as to list of 
courses, description of training to be offered, audiences to be reached 
and numbers to be trained. Dates and locations of training as well as 
costs of delivery and student travel and per diem are to be estimated. 
Special instructions for this portion of the submittal will be included 
in the Application Package.
    (iii) Standard Form 270 ``Request for Advance or Reimbursement'' as 
required by OMB Circular A-102 and FEMA General Provisions for 
Cooperative Agreements.
    (d) Reporting agreements. Recipients of State Agreement benefits 
will report quarterly during the Federal Fiscal year, directly to the 
Regional Director of their respective Regions. The report should include 
a narrative of the training programs conducted accompanied by rosters 
for each event, agenda, and a summary financial statement on the status 
of the Agreement funds. Any course or training activity included in the 
Scope of Work and not presented as scheduled should be explained in 
detail as to the reason for cancellation in the quarterly report. The 
costs allocated to this cancelled activity should be reprogrammed to 
another training activity approved by the Regional Director no later 
than the last day of the 3rd quarter, or released to the Region. An 
evaluation of the degree to which objectives were met, the effectiveness 
of the methodology, and the appropriateness of the resources and 
references used should also be included in the quarterly report. The 
report is due in the Regional Office no later than the 15th day of 
January, April, and July. A final report for the year is due the 15th of 
October.



Sec. 360.5  General provisions for State Cooperative Agreement.

    The legal funding instrument for the State Assistance Program for 
Training and Education FEMA is the State Cooperative Agreement. All 
States will be required to comply with FEMA General Provisions for the 
State Cooperative Agreement. The General Provisions for the State 
Cooperative Agreement will be provided to the States as part of the 
Request for Application package. The General Provisions will become part 
of the Cooperative Agreement.



PART 361--NATIONAL EARTHQUAKE HAZARDS REDUCTION ASSISTANCE TO STATE AND LOCAL GOVERNMENTS--Table of Contents




       Subpart A--Earthquake Hazards Reduction Assistance Program

Sec.
361.1  Purpose.
361.2  Definitions
361.3  Project description.
361.4  Matching contributions.
361.5  Criteria for program assistance, matching contributions, and 
          return of program assistance funds.
361.6  Documentation of matching contributions.
361.7  General eligible expenditures.
361.8  Ineligible expenditures.

                          Subpart B  [Reserved]

    Authority: Reorganization Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 
1978 Comp., p. 329; Earthquake Hazards Reduction Act of 1977, as 
amended, 42 U.S.C. 7701 et seq.; E.O. 12148, 44 FR 43239, 3 CFR, 1979 
Comp., p. 412; and E.O. 12381, 47 FR 39795, 3 CFR, 1982 Comp., p. 207.

    Source: 57 FR 34869, Aug. 7, 1992, unless otherwise noted.

[[Page 621]]



       Subpart A--Earthquake Hazards Reduction Assistance Program



Sec. 361.1  Purpose.

    This part prescribes the policies to be followed by the Federal 
Emergency Management Agency (FEMA) and States in the administration of 
FEMA's earthquake hazards reduction assistance program, and establishes 
the criteria for cost-sharing.



Sec. 361.2  Definitions.

    Cash Contribution means the State cash outlay (expenditure), 
including the outlay of money contributed to the State by other public 
agencies and institutions, and private organizations and individuals. 
All expenditures must be listed in the project's approved budget.
    Certification represents the Governor's written assurance describing 
the steps State agencies will take toward meeting the 50 percent cash 
contribution required following the third year of program funding. The 
letter of certification is intended to assist the State maintain a 
commitment to and plan for securing the future cash match with the long-
range goal of developing an ongoing, rather than a short-term, State 
program.
    Cost Sharing and Matching represent that portion of project costs 
not borne by the Federal Government.
    Eligible Activities are activities for which FEMA may provide 
funding to States under this section. They include specific activities 
or projects related to earthquake hazards reduction which fall into one 
or more of the following categories: Preparedness and response planning; 
mitigation planning and implementation, including inventories 
preparation, seismic safety inspections of critical structures and 
lifelines, updating building and zoning codes and ordinances to enhance 
seismic safety; and public awareness and education. The activities that 
will actually be funded shall be determined through individual 
negotiations between FEMA and the States (see criteria in 
Sec. 361.3(3)).
    In-kind contributions represent the value of non-cash contributions 
provided by the States and other non-Federal parties. In-kind 
contributions may be in the form of charges for real property and non-
expendable personal property and the value of goods and services 
directly benefiting and specifically identifiable to the States' 
earthquake hazards reduction projects.
    Project means the complete set of approved earthquake hazards 
reduction activities undertaken by a State, or other jurisdiction, on a 
cost-shared basis with FEMA in a given Federal fiscal year.
    Project Period is the duration of time over which an earthquake 
hazards reduction project is implemented.
    State refers to the States of the United States of America, 
individually or collectively, the District of Columbia, the Commonwealth 
of Puerto Rico, the Virgin Islands, Guam, American Samoa, the Mariana 
Islands, and any other territory or possession of the United States. It 
also means local units of government or substate areas that include a 
number of local government jurisdictions.
    State Assistance means the funding provided under this subpart by 
FEMA through the National Earthquake Hazards Reduction Program (NEHRP) 
to States to develop State programs specifically related to earthquake 
hazards reduction. The term also includes assistance to local units of 
government or substate areas, such as a group of several counties.
    Target Allocation is the maximum amount of FEMA earthquake program 
funds presumably available to an eligible State in a fiscal year. It is 
based primarily upon the total amount of State assistance funds 
available to FEMA annually, the number of eligible States, and a 
nationally standardized comparison of these States' seismic hazard and 
population-at-risk. The target allocation is not necessarily the amount 
of funding that a State will actually receive from FEMA. Rather, it 
represents a planning basis of negotiations between the State and its 
FEMA Regional Office which will ultimately determine the actual amount 
of earthquake State assistance to be provided by FEMA.



Sec. 361.3  Project description.

    (a) An objective of the Earthquake Hazards Reduction Act is to 
develop, in

[[Page 622]]

areas of seismic risk, improved understanding of and capability with 
respect to earthquake-related issues, including methods of mitigating 
earthquake damage, planning to prevent or minimize earthquake damage, 
disseminating warnings of earthquakes, organizing emergency services, 
and planning for post-earthquake recovery. To achieve this objective, 
FEMA has implemented an earthquake hazards reduction assistance program 
for State and local governments in seismic risk areas.
    (b) This assistance program provides funding for earthquake hazards 
reduction activities which are eligible according to the definition in 
Sec. 361.2. The categories, or program elements, listed therein comprise 
a comprehensive earthquake hazards reduction project for any given 
seismic hazard area. Key aspects of each of these elements are as 
follows:
    (1) Mitigation involves developing and implementing strategies for 
reducing losses from earthquakes by incorporating principles of seismic 
safety into public and private decisions regarding the siting, design, 
and construction of structures (i.e., updating building and zoning codes 
and ordinances to enhance seismic safety), and regarding buildings' 
nonstructural elements, contents and furnishings. Mitigation includes 
preparing inventories of and conducting seismic safety inspections of 
critical structures and lifelines, and developing plans for identifying 
and retrofitting existing structures that pose threats to life or would 
suffer major damage in the event of a serious earthquake.
    (2) Preparedness/response planning are closely related and usually 
considered as one comprehensive activity. They do differ, however, in 
that preparedness planning involves those efforts undertaken before an 
earthquake to prepare for or improve capability to respond to the event, 
while response planning can be defined as the planning necessary to 
implement an effective response once the earthquake has occurred. 
Preparedness/response planning usually considers functions related to 
the following:
    (i) Rescue and fire services;
    (ii) Medical services;
    (iii) Damage assessments;
    (iv) Communications;
    (v) Security;
    (vi) Restoration of lifeline and utility services;
    (vii) Transportation;
    (viii) Sheltering, food and water supplies;
    (ix) Public health and information services;
    (x) Post-disaster recovery and the return of economic stability;
    (xi) Secondary impacts, such as dam failures, toxic releases, etc.; 
and
    (xii) Organization and management.
    (3) Public awareness/earthquake education activities are designed to 
increase public awareness of earthquakes and their associated risks, and 
to stimulate behavioral changes to foster a self-help approach to 
earthquake preparedness, response, and mitigation. Audiences that may be 
targeted for such efforts include:
    (i) The general public;
    (ii) School populations (administrators, teachers, students, and 
parents);
    (iii) Special needs groups (e.g., elderly, disabled, non-English 
speaking);
    (iv) Business and industry;
    (v) Engineers, architects, builders;
    (vi) The media; and
    (vii) Public officials.
    (4) Other Activities in support of those listed in Sec. 361.3(b)(1), 
(b)(2), and (b)(3) may include, but are not limited to, State seismic 
advisory boards which provide State and local officials responsible for 
implementing earthquake hazards reduction projects with expert advice in 
a variety of fields; hazard identification which defines the potential 
for earthquakes and their related geological hazards in a particular 
area; and vulnerability assessments, also known as loss estimation 
studies, which provide information on the impacts and consequences of an 
earthquake on an area's resources, as well as opportunities for 
earthquake hazards mitigation.
    (c) State eligibility for financial assistance to States under this 
section is determined by FEMA based on a combination of the following 
criteria:
    (1) Seismic hazard, including the historic occurrence of damaging 
earthquakes, as well as probable seismic activity;

[[Page 623]]

    (2) Total population and major urban concentrations exposed to such 
risk; and
    (3) Other factors, the loss, damage, or disruption of which by a 
severe earthquake would have serious national impacts upon national 
security, such as industrial concentrations, concentrations or 
occurrences of natural resources, financial/economic centers and 
national defense facilities.
    (d) Each fiscal year, FEMA will establish a target allocation of 
earthquake program funds for each eligible State.
    (e) The specific activities, and the distribution of funds among 
them, that will be undertaken with this assistance will be determined 
during the annual Comprehensive Cooperative Agreement (CCA) negotiations 
between FEMA and the State, and will be based upon the following:
    (1) The availability of information regarding identification of 
seismic hazards and vulnerability to those hazards;
    (2) Earthquake hazards reduction accomplishments of the State to 
date;
    (3) State and Federal priorities for needed earthquake hazards 
reduction activities; and
    (4) State and local capabilities with respect to staffing, 
professional expertise, and funding.
    (f) As a condition of receiving FEMA funding, a percentage of the 
amount of the total State project (FEMA State assistance, combined with 
the State match) must be spent for activities under the Mitigation 
Planning element. The percentage, to be determined by FEMA, may be 
increased by no more than 5 percent annually, beginning at 15 percent in 
fiscal year 1991 with a limit of 50 percent of the total State project. 
The increase will take into account the amount of time a State has been 
participating in the program. States may expend more than the required 
percentage of funding on eligible mitigation activities.
    (g) The State match may be distributed among the eligible activities 
in any manner that is mutually agreed upon by FEMA and the State in the 
CCA negotiations.
    (h) Negotiations between FEMA and the State regarding the scope of 
work and the determination of the amount of State assistance to be 
awarded shall consider earthquake hazards reduction activities 
previously accomplished by the State, as well as the quality of their 
performance.



Sec. 361.4  Matching contributions.

    (a) All State assistance will be cost shared after the first year of 
funding. States which received a grant before October 1, 1990, which 
included the 50 percent non-Federal contribution to the State program, 
will continue to match the Federal funds on a 50 percent cash match 
basis.
    (b) States which did not receive a grant before October 1, 1990, 
will assume cost sharing on a phased-in basis over a period of four 
years with the full cost sharing requirements being implemented in the 
fourth year. The sequence is as follows:
    (1) For the first fiscal year, cost sharing will be voluntary. FEMA 
will provide State assistance without requiring a State match. Those 
States that are able to cost-share are encouraged to do so (on either a 
cash or in-kind basis).
    (2) For the second fiscal year, the minimum acceptable non-Federal 
contribution is 25 percent of the total project cost, which may be 
satisfied through an in-kind contribution. Those States that are able to 
cost-share on a cash-contribution basis are encouraged to do so.
    (3) For the third fiscal year, the minimum acceptable non-Federal 
contribution is 35 percent of the total project cost, which may be 
satisfied through an in-kind contribution. Those States that are able to 
cost-share on a cash-contribution basis are encouraged to do so.
    (4) For the fourth and subsequent fiscal years, full cost sharing 
will be implemented, requiring a minimum of a 50 percent non-Federal 
contribution to a State program, with this share required to be cash. 
In-kind matching will no longer be acceptable. Thus, every dollar FEMA 
provides to a State must be matched by one dollar from the State. States 
that can contribute an amount greater than that required

[[Page 624]]

by the match are permitted and encouraged to do so. However, State 
assistance will not exceed the established target allocation.
    (c) The State contribution need not be applied at the exact time of 
the obligation of the Federal funds. However, the State full matching 
share must be obligated by the end of the project period for which the 
State assistance has been made available for obligation under an 
approved program or budget.
    (d) In the event a State interrupts its participation in this 
program, if it later elects to participate again, the nature and amount 
of that State's cost sharing shall be determined by the regulations then 
in effect, taking into account the number of years in which the State 
previously participated.



Sec. 361.5  Criteria for program assistance, matching contributions, and return of program assistance funds.

    (a) In order to qualify for assistance, a State must:
    (1) Demonstrate that the assistance will result in enhanced seismic 
safety in the State;
    (2) Provide a share of the costs of the activities for which 
assistance is being given, in accordance with Sec. 361.4; and
    (3) Demonstrate that it is taking actions to ensure its ability to 
meet the 50 percent cash contribution commitment either on an ongoing 
basis or for new States, by the fourth year of funding.
    (i) The Governor of newly participating State must certify to the 
FEMA Regional Director the State will take steps to meet the 50 percent 
cash contribution requirement after the third year of funding. The 
specific steps to be taken will be outlined in the certification which 
must be submitted prior to the State receiving program funds.
    (ii) The Governor must certify the State's continued commitment in 
the second and third years of funding. The certification will describe 
the progress made on the steps contained in the previous year's 
certification and steps to be taken in the future. The certification 
must be submitted to the Regional Director before the State will receive 
program funds.
    (iii) If a State encounters difficulties meeting the 50 percent cash 
contribution requirement for the target allocation following the fourth 
year of funding, the Regional Director may require the Governor to 
continue certifying the State is working to resolve the difficulty.
    (iv) A State will not receive Federal funds if it cannot provide the 
required cash contribution.
    (b) The value of any resources accepted as a matching share under 
one Federal agreement or program cannot be counted again as a 
contribution under another.
    (c) The State seeking the match shall submit documentation 
sufficient for FEMA to determine that the contribution meets the 
following requirements. The match shall be:
    (1) Necessary and reasonable for proper, cost-effective and 
efficient administration of the project, allocable solely thereto, and 
except as specifically provided herein, not be a general expense 
required to carry out the overall responsibilities of State and local 
governments;
    (2) Verifiable from the recipient State's records;
    (3) Not allocable to or included as a cost of any other Federally 
financed program in either the current or a prior period;
    (4) Authorized under State law;
    (5) Consistent with any limitations or exclusions set forth in these 
regulations, Federal laws or other governing limitations as to types of 
cost items;
    (6) Accorded consistent treatment through application of generally 
accepted accounting principles appropriate to the circumstances;
    (7) Provided for in the approved budget/workplan of the State; and
    (8) Consistent with OMB Circular A-87, ``Cost Principles for State 
and Local Governments,'' and with 44 CFR part 13, Uniform Administrative 
Requirements for Grants and Cooperative Agreements to State and Local 
Governments.
    (d) A State must submit and FEMA must approve a statement of work 
before the State receives any grant funds. The statement of work and 
target allocation of funds are based on a 12-month performance period. 
Except under extenuating circumstances, the funds initially obligated to 
the State will be

[[Page 625]]

based on the amount of time remaining in the performance period at the 
time the statement of work is approved. (Approved by the Office of 
Management and Budget under OMB control number 3067-0170.)
    (e) States are expected to perform activities and therefore expend 
funds on a quarterly basis in accordance with the approved statement of 
work. At the end of the third quarter, State and FEMA regional office 
staff will review the State's accomplishments to date. Funds not 
expended in accordance with the approved statement of work by the end of 
the third quarter of the performance period will not be made available 
to the State unless the State can demonstrate, and FEMA approves, its 
ability to perform activities adequately resulting in the expenditure of 
the funds by the end of the performance period.



Sec. 361.6  Documentation of matching contributions.

    (a) The statement of work provided by the State to FEMA describing 
the specific activities comprising its earthquake hazards reduction 
project, including the project budget, shall reflect a level of effort 
commensurate with the total of the State and FEMA contributions.
    (b) The basis by which the State determines the value of an in-kind 
match must be documented and a copy retained as part of the official 
record.
    (c) The State shall maintain all records pertaining to matching 
contributions for a three-year period after the date of submission of 
the final financial report required by the CCA, or date of audit, 
whichever date comes first.



Sec. 361.7  General eligible expenditures.

    (a) Expenditures must be for activities described in the statement 
of work mutually agreed to by FEMA and the State during the annual 
negotiation process, or for activities that the State agrees to perform 
as a result of subsequent modifications to that statement of work. These 
activities shall be consistent with the definition of eligible 
activities in Sec. 361.2.
    (b) The following is a list of eligible expenditures. When items do 
not appear on the list they will be considered on a case-by-case basis 
for policy determinations, based on criteria set forth in Sec. 361.5. 
All costs must be reasonable, and consistent with OMB Circular A-87.
    (1) Direct and indirect salaries or wages (including overtime) of 
employees hired specifically for carrying out earthquake hazards 
reduction activities are eligible when engaged in the performance of 
eligible work.
    (2) Reasonable costs for work performed by private contractors on 
eligible projects contracted for by the State.
    (3) Travel costs and per diem costs of State employees not to exceed 
the actual subsistence expense basis for the permanent or temporary 
activity, as determined by the State's cost principles governing travel.
    (4) Non-expendable personal property, office supplies, and supplies 
for workshops; exhibits.
    (5) A maximum of $8,000 or 10 percent of the total project 
allocation, whichever is less, may be expended for personal computer 
equipment in the first year of program funding. A full-time earthquake 
staff person must be employed and the equipment must be dedicated 
entirely to the earthquake project.
    (6) Meetings and conferences, when the primary purpose is 
dissemination of information relating to the earthquake hazards 
reduction project.
    (7) Training which directly benefits the conduct of earthquake 
hazards reduction activities.



Sec. 361.8  Ineligible expenditures.

    (a) Expenditures for anything defined as an unallowable cost by OMB 
Circular A-87.
    (b) Federal funds may not be used for the purchase or rental of any 
equipment such as radio/telephone communications equipment, warning 
systems, and computers and other related information processing 
equipment, except as stated in Sec. 361.7(b)(5). If a State wishes to 
use its matching funds for this purpose, it must:
    (1) Document during the annual negotiation process with FEMA how 
this equipment will support the earthquake hazards reduction activities 
in its scope of work (see Sec. 361.7(a)); and

[[Page 626]]

    (2) Claim as credit for its match, if the equipment is to be used 
for purposes in addition to support of earthquake hazards reduction 
activities, only that proportion of costs directly related to its 
earthquake hazards reduction project.



                          Subpart B  [Reserved]



PART 362--CRITERIA FOR ACCEPTANCE OF GIFTS, BEQUESTS, OR SERVICES--Table of Contents




Sec.
362.1  Purpose.
362.2  Definitions.
362.3  Criteria for determining acceptance.

    Authority: 42 U.S.C. 7701, 7705c.

    Source: 59 FR 35631, July 13, 1994, unless otherwise noted.



Sec. 362.1  Purpose.

    This part establishes criteria for determining whether the Director 
may accept gifts, bequests, or donations of services, money or property 
for the National Earthquake Hazards Reduction Program (NEHRP), under 
section 9 of the National Earthquake Hazards Reduction Program 
Reauthorization Act, 42 U.S.C. 7705c.



Sec. 362.2  Definitions.

    As used in this part--
    Gifts of property means a gratuitous, voluntary transfer or 
conveyance of ownership in property by one person to another without any 
consideration, including transfer by donation, devise or bequest.
    Gifts of services means a gratuitous, voluntary offer of labor or 
professional work by one person to another without any compensation for 
that labor or professional work.
    Program Agencies means the Federal Emergency Management Agency, the 
United States Geological Survey, the National Science Foundation, and 
the National Institute of Standards and Technology.
    Property means real or personal property, tangible or intangible, 
including money, certificates of stocks, bonds, or other evidence of 
value.
    Services means labor or professional work performed for the benefit 
of another or at another's command.
    Solicit means to endeavor to obtain by asking or pleading.



Sec. 362.3  Criteria for determining acceptance.

    The following criteria shall be applied whenever a gift of property 
or gift of services is offered to the Director for the benefit of the 
National Earthquake Hazards Reduction Program.
    (a) The gift of property or gift of services must clearly and 
directly further the objectives of the National Earthquake Hazards 
Reduction Program, as defined in 42 U.S.C. 7702.
    (b) All gifts of property must be offered unconditionally, with sole 
discretion of use, administration and disposition of such property to be 
determined by the Director or his designee.
    (c) The Director may accept and use gifts of services of voluntary 
and uncompensated personnel, and may provide transportation and 
subsistence as authorized by 5 U.S.C. 5703 for persons serving without 
compensation.
    (d) Employees of FEMA or the Program agencies may not solicit gifts 
of property, or gifts of services.
    (e) Acceptance of gifts of property, or gifts of services must first 
be approved by the Office of the General Counsel, FEMA, for conformance 
with all applicable laws and regulations.
    (f) In all cases where it is determined that the acceptance of a 
gift may create a conflict of interest, or the appearance of a conflict 
of interest, the gift will be declined.



PARTS 363-399  [RESERVED]




[[Page 627]]



   CHAPTER IV--DEPARTMENT OF COMMERCE AND DEPARTMENT OF TRANSPORTATION




  --------------------------------------------------------------------
Part                                                                Page
401             Shipping restrictions (T-1).................         628
402             Shipments on American flag ships and 
                    aircraft (T-1, Int. 1)..................         629
403             Shipping restrictions; North Korea and the 
                    Communist-controlled area of Vietnam (T-
                    2)......................................         630
404-499                                   [Reserved]

[[Page 628]]



PART 401--SHIPPING RESTRICTIONS (T-1)--Table of Contents




Sec.
401.1  Prohibited transportation and discharge.
401.2  Application for adjustment or exceptions.
401.3  Reports.
401.4  Records.
401.5  Defense against claims for damages.
401.6  Violations.

    Authority: Sec. 704, 64 Stat. 816, as amended; 50 U.S.C. app. 2154, 
as amended; Interpret or apply secs. 101, 705, 64 Stat. 799, as amended; 
50 U.S.C. app. 2071; E.O. 10480, 3 CFR, 1949-1953 Comp., p. 962.

    Source: Transportation Order T-1, 30 FR 9092, July 21, 1965; 32 FR 
15831, Nov. 17, 1967. Redesignated at 45 FR 44574, July 1, 1980, unless 
otherwise noted.



Sec. 401.1  Prohibited transportation and discharge.

    No person shall transport in any ship documented under the laws of 
the United States or in any aircraft registered under the laws of the 
United States any commodity at the time not identified by the Symbol B 
in the last column of the Commodity Control List (339.1 of the 
Comprehensive Export Schedule, issued by the Bureau of International 
Commerce, Department of Commerce (15 CFR parts 368 through 399), any 
article designated as arms, ammunition, and implements of war in the 
United States Munitions List (22 CFR parts 121 through 128), or any 
commodity, including fissionable, materials controlled for export under 
the Atomic Energy Act of 1954, as amended, to any destination at the 
time in country groups X, Y, or Z as set forth in the Comprehensive 
Export Schedule (15 CFR 370.1(g)(2)), and no person shall discharge from 
any such ship or any such aircraft any such commodity or article at any 
such port or place or at any other port or place in transit to any such 
destination, unless a validated export license under the Export Control 
Act of 1949, as amended, under section 414 of the Mutual Security Act of 
1954, as amended, or under the Atomic Energy Act of 1954, as amended, 
has been obtained for the shipment, or unless authorization for the 
shipment has been obtained from the Assistant Secretary for Domestic and 
International Business. This prohibition applies to the owner of the 
ship or aircraft, the master of the ship or aircraft, or any other 
officer, employee or agent of the owner of the ship or aircraft who 
participates in the transportation. The consular officers of the United 
States are furnished with current copies of the Commodity Control List.



Sec. 401.2  Application for adjustment or exceptions.

    Any person affected by any provisions of this order may file an 
application for an adjustment or exception upon the ground that such 
provision works an exceptional hardship upon him, not suffered by 
others, or that its enforcement against him would not be in the interest 
of the national defense program. Such an application may be made by 
letter or telegram addressed to the Assistant Secretary for Domestic and 
International Business, Department of Commerce, Washington, DC, 20230, 
reference T-1. If authorization is requested, any such application 
should specify in detail the material to be shipped, the name and 
address of the shipper and of the recipient of the shipment, the ports 
or places from which and to which the shipment is being made and the use 
to which the material shipped will be put. The application should also 
specify in detail the facts which support the applicant's claim for an 
exception.



Sec. 401.3  Reports.

    Persons subject to this order shall submit such reports to the 
Assistant Secretary for Domestic and International Business as he shall 
require, subject to the terms of the Federal Reports Act.



Sec. 401.4  Records.

    Each person participating in any transaction covered by this order 
shall retain in his possession, for at least 2 years, records of 
shipments in sufficient detail to permit an audit that determines for 
each transaction that the provisions of this order have been met. This 
does not specify any particular accounting method and does not require 
alteration of the system of records customarily maintained, provided 
such records supply an adequate basis for

[[Page 629]]

audit. Records may be retained in the form of microfilm or other 
photographic copies instead of the originals.



Sec. 401.5  Defense against claims for damages.

    No person shall be held liable for damages or penalties for any 
default under any contract or order which shall result directly or 
indirectly from compliance with this order or any provision thereof, 
notwithstanding that this order or such provision shall thereafter be 
declared by judicial or other competent authority to be invalid.



Sec. 401.6  Violations.

    Any person who wilfully violates any provisions of this order or 
wilfully conceals a material fact or furnishes false information in the 
course of operation under this order is guilty of a crime and upon 
conviction may be punished by fine or imprisonment or both. In addition, 
administrative action may be taken against any such person, denying him 
the privileges generally accorded under this order.



PART 402--SHIPMENTS ON AMERICAN FLAG SHIPS AND AIRCRAFT (T-1, INT. 1)--Table of Contents




Sec.
402.1  Shipments from the United States.
402.2  Restricted commodities.
402.3  Addition of commodities to the Positive List.
402.4  Calls at restricted ports en route to an unrestricted port with 
          restricted cargo.
402.5  Forwarding commodities previously shipped.
402.6  Relation to Transportation Order T-2.

    Authority: Sec. 704, 64 Stat. 816, as amended; 50 U.S.C. app. 2154. 
Interpret or apply sec. 101, 64 Stat. 799, as amended; 50 U.S.C. app. 
2071, E.O. 10480, 3 CFR, 1949-1953 Comp., p. 962.

    Source: Transportation Order T-1, Interpretation 1, 15 FR 9145, Dec. 
21, 1950; 32 FR 15831, Nov. 17, 1967. Redesignated at 45 FR 44574, July 
1, 1980, unless otherwise noted.



Sec. 402.1  Shipments from the United States.

    Transportation Order T-1 applies to shipments from the United 
States, as well as to shipments from foreign ports, on American flag 
ships and aircraft.



Sec. 402.2  Restricted commodities.

    The restrictions of Transportation Order T-1 apply to the 
transportation or discharge of (a) commodities on the Positive List (15 
CFR part 399) (as amended from time to time) of the Comprehensive Export 
Schedule of the Office of International Trade, Department of Commerce, 
(b) articles on the list of arms, ammunition and implements of war 
coming within the meaning of Proclamation No. 2776 of March 26, 1948, 
and (c) commodities, including fissionable materials, controlled for 
export under the Atomic Energy Act of 1946. The restrictions imposed by 
Transportation Order T-1 do not apply to other commodities, not within 
these restricted classes at the time of transportation or discharge, 
even though authorization for the export of the commodity from the 
United States to the particular destination is required under 
regulations of the Office of International Trade or under other Federal 
law or regulation. In this respect, Order T-1 is different from Order T-
2 which applies to all commodities destined to Communist China. Order T-
1 does not relax or modify any of the requirements of any other 
regulation or law.



Sec. 402.3  Addition of commodities to the Positive List.

    Order T-1 applies to the transportation or discharge of commodities 
which are restricted at the time of transportation or discharge. 
Accordingly, if a commodity is added to the Positive List while the 
commodity is being transported on an American flag ship or aircraft, the 
restrictions of Order T-1 immediately apply and the commodity may not be 
transported to or discharged at any of the restricted ports or 
discharged in transit to one of the restricted ports, unless 
authorization under Order T-1 is obtained.



Sec. 402.4  Calls at restricted ports en route to an unrestricted port with restricted cargo.

    Order T-1 does not prohibit an American flag ship or aircraft from 
going to or calling at one of the restricted

[[Page 630]]

ports, even though it has on board a commodity which could not be 
discharged at that port. (Note, however, that Order T-2 prohibits 
American flag ships and aircraft from calling at any port or other place 
in Communist China.) For example, an American flag ship may call at one 
of the restricted ports (except one in Communist China), even though it 
has on board the following classes of commodities:
    (a) A Positive List commodity manifested to a destination outside 
the restricted area, with an export license and an export declaration 
showing the unrestricted destination at the ultimate destination, (b) a 
Positive List commodity destined for the restricted port of call which 
cannot be discharged there because there is no export license or 
authorization from the Assistant Secretary for Domestic and 
International Business permitting discharge at the restricted port of 
call, (c) a commodity of any kind destined for Communist China (the 
transportation and discharge of which is covered by Order T-2). None of 
these commodities may be discharged at the restricted port of call. 
Discharge of any of these commodities at the port covered by the 
restrictions of Order T-1 is prohibited and subject to penalty, 
regardless of the circumstances under which the discharge of the cargo 
at the restricted port occurs, unless appropriate authorization is 
obtained.



Sec. 402.5  Forwarding commodities previously shipped.

    Order T-1 applies to transportation on or discharge from ships 
documented under the laws of the United States and aircraft registered 
under the laws of the United States. These restrictions apply either in 
the case of a discharge at one of the restricted ports or to discharge 
at any other port in transit to a restricted destination. The 
restrictions of Order T-1 do not apply to transportation by foreign 
carriers, as long as there is no prohibited transportation or discharge 
by or from a United States flag ship or aircraft after the issuance of 
Order T-1. Accordingly, if an American flag ship or aircraft, before the 
issuance of Order T-1, had transported restricted commodities manifested 
to restricted destinations, and had completed the transportation to a 
foreign intermediate point and had completed the discharge from the 
American flag ship or aircraft before the issuance of Order T-1, no 
violation of that order would have occurred, but Order T-1 would 
prohibit further shipment on an American flag ship or aircraft unless 
authorization under Order T-1 is obtained.



Sec. 402.6  Relation to Transportation Order T-2.

    Transportation Order T-1 applies to the transportation of 
commodities to, or in transit to, destinations in Sub-Group A, Hong Kong 
or Macao. It applies, however, only to commodities on the Positive List 
of the Office of International Trade, arms and ammunition, and 
commodities controlled under the Atomic Energy Act (see section 2 of 
this interpretation). Transportation Order T-2 applies to the 
transportation of commodities of any kind which are destined to 
Communist China (Order T-2 also prohibits American ships and aircraft 
from calling at any port or place in Communist China). Since Communist 
China is in Sub-Group A, the restrictions of both orders apply to the 
transportation of commodities to Communist China or to any other point 
in transit to Communist China.



PART 403--SHIPPING RESTRICTIONS; NORTH KOREA AND THE COMMUNIST-CONTROLLED AREA OF VIETNAM (T-2)--Table of Contents




Sec.
403.1  Prohibition of movement of American carriers to North Korea.
403.2  Prohibition on transportation of goods destined for North Korea.
403.3  Persons affected.
403.4  Reports.
403.5  Records.
403.6  Defense against claims for damages.
403.7  Violations.

    Authority: Sec. 704, 64 Stat. 816, as amended; 50 U.S.C. app. 2154. 
\1\ Interpret or apply sec. 101, 64 Stat. 799, as amended; 50 U.S.C. 
app. 2071; E.O. 10480, 18 FR 4939, 3 CFR, 1953

[[Page 631]]

Supp.; and sec. 4(a), Pub. L. 89-670, 80 Stat. 933; 49 U.S.C. 1653.
---------------------------------------------------------------------------

    \1\ Public Law 92-325, approved June 30, 1972, extended the Defense 
Production Act of 1950, as amended, to June 30, 1974.

    Source: Transportation Order T-2 (Amended), 37 FR 25040, Nov. 25, 
1972. Redesignated at 45 FR 44574, July 1, 1980, unless otherwise noted.



Sec. 403.1  Prohibition of movement of American carriers to North Korea.

    No person shall sail, fly, navigate, or otherwise take any ship 
documented under the laws of the United States or any aircraft 
registered under the laws of the United States to North Korea.

[59 FR 8413, Feb. 22, 1994]



Sec. 403.2  Prohibition on transportation of goods destined for North Korea.

    No person shall transport, in any ship documented under the laws of 
the United States, or in any aircraft registered under the laws of the 
United States, to North Korea, any material, commodity, or cargo of any 
kind. No person shall take on board any ship documented under the laws 
of the United States or any aircraft registered under the laws of the 
United States any material, commodity, or cargo of any kind if that 
person knows or has reason to believe that the material, commodity, or 
cargo is destined, directly or indirectly for North Korea. No person 
shall discharge from any ship documented under the laws of the United 
States or from any aircraft registered under the laws of the United 
States, at any place other than the port where the cargo was loaded, or 
within territory under the jurisdiction of the United States any 
material, commodity, or cargo of any kind which that person knows or has 
reason to believe is destined for North Korea.

[59 FR 8413, Feb. 22, 1994]



Sec. 403.3  Persons affected.

    The prohibitions of this order apply to the owner of the ship or 
aircraft, to the master of the ship or aircraft, and to any other 
officer, employee, or agent of the owner of the ship or to any other 
person who participates in the prohibited activities.



Sec. 403.4  Reports.

    Persons subject to this order shall submit such reports to either 
the Assistant Secretary of Commerce for Domestic and International 
Business, Assistant Secretary of Commerce for Maritime Affairs, or the 
Assistant Secretary of Transportation for Policy and International 
Affairs, for, respectively, cargoes, vessels or aircraft as shall be 
required, subject to the terms of the Federal Reports Act.



Sec. 403.5  Records.

    Each person participating in any transaction covered by this order 
shall retain in his possession, for at least 2 years, records of voyages 
and shipments in sufficient detail to permit an audit that will 
determine for each transaction that the provisions of this order have 
been met. This provision does not require any particular accounting 
method and does not require alteration of the system customarily 
maintained, provided such records supply an adequate basis for audit. 
Records may be retained in the form of microfilm or other photographic 
copies instead of the originals.



Sec. 403.6  Defense against claims for damages.

    No person shall be held liable for damages or penalties for any 
default under any contract or order which shall result directly or 
indirectly from compliance with this order or any provision, thereof, 
notwithstanding that this order or such provision shall thereafter be 
declared by judicial or other competent authority to be invalid.



Sec. 403.7  Violations.

    Any person who willfully violates any provisions of this order, or 
willfully conceals a material fact, or furnishes false information in 
the course of operation under this order, shall, upon conviction, be 
punished by fine or imprisonment, or both. In addition, administrative 
action may be taken against any such person, denying him the privileges 
generally accorded under this order.



PARTS 404-499 [RESERVED]



[[Page 633]]


                              FINDING AIDS




  --------------------------------------------------------------------

  A list of CFR titles, subtitles, chapters, subchapters and parts and 
an alphabetical list of agencies publishing in the CFR are included in 
the CFR Index and Finding Aids volume to the Code of Federal Regulations 
which is published separately and revised annually.

  Table of CFR Titles and Chapters
  Alphabetical List of Agencies Appearing in the CFR
  List of CFR Sections Affected



[[Page 635]]



                    Table of CFR Titles and Chapters




                   (Revised as of September 30, 1997)

                      Title 1--General Provisions

         I  Administrative Committee of the Federal Register 
                (Parts 1--49)
        II  Office of the Federal Register (Parts 50--299)
        IV  Miscellaneous Agencies (Parts 400--500)

                          Title 2--[Reserved]

                        Title 3--The President

         I  Executive Office of the President (Parts 100--199)

                           Title 4--Accounts

         I  General Accounting Office (Parts 1--99)
        II  Federal Claims Collection Standards (General 
                Accounting Office--Department of Justice) (Parts 
                100--299)

                   Title 5--Administrative Personnel

         I  Office of Personnel Management (Parts 1--1199)
        II  Merit Systems Protection Board (Parts 1200--1299)
       III  Office of Management and Budget (Parts 1300--1399)
        IV  Advisory Committee on Federal Pay (Parts 1400--1499)
         V  The International Organizations Employees Loyalty 
                Board (Parts 1500--1599)
        VI  Federal Retirement Thrift Investment Board (Parts 
                1600--1699)
       VII  Advisory Commission on Intergovernmental Relations 
                (Parts 1700--1799)
      VIII  Office of Special Counsel (Parts 1800--1899)
        IX  Appalachian Regional Commission (Parts 1900--1999)
        XI  Armed Forces Retirement Home (Part 2100)
       XIV  Federal Labor Relations Authority, General Counsel of 
                the Federal Labor Relations Authority and Federal 
                Service Impasses Panel (Parts 2400--2499)
        XV  Office of Administration, Executive Office of the 
                President (Parts 2500--2599)
       XVI  Office of Government Ethics (Parts 2600--2699)
       XXI  Department of the Treasury (Parts 3100--3199)
      XXII  Federal Deposit Insurance Corporation (Part 3201)
     XXIII  Department of Energy (Part 3301)

[[Page 636]]

      XXIV  Federal Energy Regulatory Commission (Part 3401)
      XXVI  Department of Defense (Part 3601)
    XXVIII  Department of Justice (Part 3801)
      XXIX  Federal Communications Commission (Parts 3900--3999)
       XXX  Farm Credit System Insurance Corporation (Parts 4000--
                4099)
      XXXI  Farm Credit Administration (Parts 4100--4199)
    XXXIII  Overseas Private Investment Corporation (Part 4301)
      XXXV  Office of Personnel Management (Part 4501)
        XL  Interstate Commerce Commission (Part 5001)
       XLI  Commodity Futures Trading Commission (Part 5101)
      XLII  Department of Labor (Part 5201)
     XLIII  National Science Foundation (Part 5301)
       XLV  Department of Health and Human Services (Part 5501)
      XLVI  Postal Rate Commission (Part 5601)
     XLVII  Federal Trade Commission (Part 5701)
    XLVIII  Nuclear Regulatory Commission (Part 5801)
         L  Department of Transportation (Part 6001)
       LII  Export-Import Bank of the United States (Part 6201)
      LIII  Department of Education (Parts 6300--6399)
       LIV  Environmental Protection Agency (Part 6401)
      LVII  General Services Administration (Part 6701)
     LVIII  Board of Governors of the Federal Reserve System (Part 
                6801)
       LIX  National Aeronautics and Space Administration (Part 
                6901)
        LX  United States Postal Service (Part 7001)
       LXI  National Labor Relations Board (Part 7101)
      LXII  Equal Employment Opportunity Commission (Part 7201)
     LXIII  Inter-American Foundation (Part 7301)
       LXV  Department of Housing and Urban Development (Part 
                7501)
      LXVI  National Archives and Records Administration (Part 
                7601)
      LXIX  Tennessee Valley Authority (Part 7901)
      LXXI  Consumer Product Safety Commission (Part 8101)
     LXXIV  Federal Mine Safety and Health Review Commission (Part 
                8401)
     LXXVI  Federal Retirement Thrift Investment Board (Part 8601)
    LXXVII  Office of Management and Budget (Part 8701)

                          Title 6--[Reserved]

                         Title 7--Agriculture

            Subtitle A--Office of the Secretary of Agriculture 
                (Parts 0--26)
            Subtitle B--Regulations of the Department of 
                Agriculture
         I  Agricultural Marketing Service (Standards, 
                Inspections, Marketing Practices), Department of 
                Agriculture (Parts 27--209)
        II  Food and Consumer Service, Department of Agriculture 
                (Parts 210--299)

[[Page 637]]

       III  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 300--399)
        IV  Federal Crop Insurance Corporation, Department of 
                Agriculture (Parts 400--499)
         V  Agricultural Research Service, Department of 
                Agriculture (Parts 500--599)
        VI  Natural Resources Conservation Service, Department of 
                Agriculture (Parts 600--699)
       VII  Farm Service Agency, Department of Agriculture (Parts 
                700--799)
      VIII  Grain Inspection, Packers and Stockyards 
                Administration (Federal Grain Inspection Service), 
                Department of Agriculture (Parts 800--899)
        IX  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Fruits, Vegetables, Nuts), Department 
                of Agriculture (Parts 900--999)
         X  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Milk), Department of Agriculture 
                (Parts 1000--1199)
        XI  Agricultural Marketing Service (Marketing Agreements 
                and Orders; Miscellaneous Commodities), Department 
                of Agriculture (Parts 1200--1299)
      XIII  Northeast Dairy Compact Commission (Parts 1300--1399)
       XIV  Commodity Credit Corporation, Department of 
                Agriculture (Parts 1400--1499)
        XV  Foreign Agricultural Service, Department of 
                Agriculture (Parts 1500--1599)
       XVI  Rural Telephone Bank, Department of Agriculture (Parts 
                1600--1699)
      XVII  Rural Utilities Service, Department of Agriculture 
                (Parts 1700--1799)
     XVIII  Rural Housing Service, Rural Business-Cooperative 
                Service, Rural Utilities Service, and Farm Service 
                Agency, Department of Agriculture (Parts 1800--
                2099)
      XXVI  Office of Inspector General, Department of Agriculture 
                (Parts 2600--2699)
     XXVII  Office of Information Resources Management, Department 
                of Agriculture (Parts 2700--2799)
    XXVIII  Office of Operations, Department of Agriculture (Parts 
                2800--2899)
      XXIX  Office of Energy, Department of Agriculture (Parts 
                2900--2999)
       XXX  Office of the Chief Financial Officer, Department of 
                Agriculture (Parts 3000--3099)
      XXXI  Office of Environmental Quality, Department of 
                Agriculture (Parts 3100--3199)
     XXXII  [Reserved]
    XXXIII  Office of Transportation, Department of Agriculture 
                (Parts 3300--3399)
     XXXIV  Cooperative State Research, Education, and Extension 
                Service, Department of Agriculture (Parts 3400--
                3499)
      XXXV  Rural Housing Service, Department of Agriculture 
                (Parts 3500--3599)

[[Page 638]]

     XXXVI  National Agricultural Statistics Service, Department 
                of Agriculture (Parts 3600--3699)
    XXXVII  Economic Research Service, Department of Agriculture 
                (Parts 3700--3799)
   XXXVIII  World Agricultural Outlook Board, Department of 
                Agriculture (Parts 3800--3899)
       XLI  [Reserved]
      XLII  Rural Business-Cooperative Service and Rural Utilities 
                Service, Department of Agriculture (Parts 4200--
                4299)

                    Title 8--Aliens and Nationality

         I  Immigration and Naturalization Service, Department of 
                Justice (Parts 1--499)

                 Title 9--Animals and Animal Products

         I  Animal and Plant Health Inspection Service, Department 
                of Agriculture (Parts 1--199)
        II  Grain Inspection, Packers and Stockyards 
                Administration (Packers and Stockyards Programs), 
                Department of Agriculture (Parts 200--299)
       III  Food Safety and Inspection Service, Meat and Poultry 
                Inspection, Department of Agriculture (Parts 300--
                599)

                           Title 10--Energy

         I  Nuclear Regulatory Commission (Parts 0--199)
        II  Department of Energy (Parts 200--699)
       III  Department of Energy (Parts 700--999)
         X  Department of Energy (General Provisions) (Parts 
                1000--1099)
        XI  United States Enrichment Corporation (Parts 1100--
                1199)
        XV  Office of the Federal Inspector for the Alaska Natural 
                Gas Transportation System (Parts 1500--1599)
      XVII  Defense Nuclear Facilities Safety Board (Parts 1700--
                1799)

                      Title 11--Federal Elections

         I  Federal Election Commission (Parts 1--9099)

                      Title 12--Banks and Banking

         I  Comptroller of the Currency, Department of the 
                Treasury (Parts 1--199)
        II  Federal Reserve System (Parts 200--299)
       III  Federal Deposit Insurance Corporation (Parts 300--399)
        IV  Export-Import Bank of the United States (Parts 400--
                499)
         V  Office of Thrift Supervision, Department of the 
                Treasury (Parts 500--599)
        VI  Farm Credit Administration (Parts 600--699)
       VII  National Credit Union Administration (Parts 700--799)

[[Page 639]]

      VIII  Federal Financing Bank (Parts 800--899)
        IX  Federal Housing Finance Board (Parts 900--999)
        XI  Federal Financial Institutions Examination Council 
                (Parts 1100--1199)
       XIV  Farm Credit System Insurance Corporation (Parts 1400--
                1499)
        XV  Thrift Depositor Protection Oversight Board (Parts 
                1500--1599)
      XVII  Office of Federal Housing Enterprise Oversight, 
                Department of Housing and Urban Development (Parts 
                1700-1799)
     XVIII  Community Development Financial Institutions Fund, 
                Department of the Treasury (Parts 1800--1899)

               Title 13--Business Credit and Assistance

         I  Small Business Administration (Parts 1--199)
       III  Economic Development Administration, Department of 
                Commerce (Parts 300--399)

                    Title 14--Aeronautics and Space

         I  Federal Aviation Administration, Department of 
                Transportation (Parts 1--199)
        II  Office of the Secretary, Department of Transportation 
                (Aviation Proceedings) (Parts 200--399)
       III  Commercial Space Transportation, Federal Aviation 
                Administration, Department of Transportation 
                (Parts 400--499)
         V  National Aeronautics and Space Administration (Parts 
                1200--1299)

                 Title 15--Commerce and Foreign Trade

            Subtitle A--Office of the Secretary of Commerce (Parts 
                0--29)
            Subtitle B--Regulations Relating to Commerce and 
                Foreign Trade
         I  Bureau of the Census, Department of Commerce (Parts 
                30--199)
        II  National Institute of Standards and Technology, 
                Department of Commerce (Parts 200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)
        IV  Foreign-Trade Zones Board, Department of Commerce 
                (Parts 400--499)
       VII  Bureau of Export Administration, Department of 
                Commerce (Parts 700--799)
      VIII  Bureau of Economic Analysis, Department of Commerce 
                (Parts 800--899)
        IX  National Oceanic and Atmospheric Administration, 
                Department of Commerce (Parts 900--999)
        XI  Technology Administration, Department of Commerce 
                (Parts 1100--1199)
      XIII  East-West Foreign Trade Board (Parts 1300--1399)
       XIV  Minority Business Development Agency (Parts 1400--
                1499)

[[Page 640]]

            Subtitle C--Regulations Relating to Foreign Trade 
                Agreements
        XX  Office of the United States Trade Representative 
                (Parts 2000--2099)
            Subtitle D--Regulations Relating to Telecommunications 
                and Information
     XXIII  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                2300--2399)

                    Title 16--Commercial Practices

         I  Federal Trade Commission (Parts 0--999)
        II  Consumer Product Safety Commission (Parts 1000--1799)

             Title 17--Commodity and Securities Exchanges

         I  Commodity Futures Trading Commission (Parts 1--199)
        II  Securities and Exchange Commission (Parts 200--399)
        IV  Department of the Treasury (Parts 400--499)

          Title 18--Conservation of Power and Water Resources

         I  Federal Energy Regulatory Commission, Department of 
                Energy (Parts 1--399)
       III  Delaware River Basin Commission (Parts 400--499)
        VI  Water Resources Council (Parts 700--799)
      VIII  Susquehanna River Basin Commission (Parts 800--899)
      XIII  Tennessee Valley Authority (Parts 1300--1399)

                       Title 19--Customs Duties

         I  United States Customs Service, Department of the 
                Treasury (Parts 1--199)
        II  United States International Trade Commission (Parts 
                200--299)
       III  International Trade Administration, Department of 
                Commerce (Parts 300--399)

                     Title 20--Employees' Benefits

         I  Office of Workers' Compensation Programs, Department 
                of Labor (Parts 1--199)
        II  Railroad Retirement Board (Parts 200--399)
       III  Social Security Administration (Parts 400--499)
        IV  Employees' Compensation Appeals Board, Department of 
                Labor (Parts 500--599)
         V  Employment and Training Administration, Department of 
                Labor (Parts 600--699)
        VI  Employment Standards Administration, Department of 
                Labor (Parts 700--799)
       VII  Benefits Review Board, Department of Labor (Parts 
                800--899)
      VIII  Joint Board for the Enrollment of Actuaries (Parts 
                900--999)

[[Page 641]]

        IX  Office of the Assistant Secretary for Veterans' 
                Employment and Training, Department of Labor 
                (Parts 1000--1099)

                       Title 21--Food and Drugs

         I  Food and Drug Administration, Department of Health and 
                Human Services (Parts 1--1299)
        II  Drug Enforcement Administration, Department of Justice 
                (Parts 1300--1399)
       III  Office of National Drug Control Policy (Parts 1400--
                1499)

                      Title 22--Foreign Relations

         I  Department of State (Parts 1--199)
        II  Agency for International Development, International 
                Development Cooperation Agency (Parts 200--299)
       III  Peace Corps (Parts 300--399)
        IV  International Joint Commission, United States and 
                Canada (Parts 400--499)
         V  United States Information Agency (Parts 500--599)
        VI  United States Arms Control and Disarmament Agency 
                (Parts 600--699)
       VII  Overseas Private Investment Corporation, International 
                Development Cooperation Agency (Parts 700--799)
        IX  Foreign Service Grievance Board Regulations (Parts 
                900--999)
         X  Inter-American Foundation (Parts 1000--1099)
        XI  International Boundary and Water Commission, United 
                States and Mexico, United States Section (Parts 
                1100--1199)
       XII  United States International Development Cooperation 
                Agency (Parts 1200--1299)
      XIII  Board for International Broadcasting (Parts 1300--
                1399)
       XIV  Foreign Service Labor Relations Board; Federal Labor 
                Relations Authority; General Counsel of the 
                Federal Labor Relations Authority; and the Foreign 
                Service Impasse Disputes Panel (Parts 1400--1499)
        XV  African Development Foundation (Parts 1500--1599)
       XVI  Japan-United States Friendship Commission (Parts 
                1600--1699)
      XVII  United States Institute of Peace (Parts 1700--1799)

                          Title 23--Highways

         I  Federal Highway Administration, Department of 
                Transportation (Parts 1--999)
        II  National Highway Traffic Safety Administration and 
                Federal Highway Administration, Department of 
                Transportation (Parts 1200--1299)
       III  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 1300--1399)

[[Page 642]]

                Title 24--Housing and Urban Development

            Subtitle A--Office of the Secretary, Department of 
                Housing and Urban Development (Parts 0--99)
            Subtitle B--Regulations Relating to Housing and Urban 
                Development
         I  Office of Assistant Secretary for Equal Opportunity, 
                Department of Housing and Urban Development (Parts 
                100--199)
        II  Office of Assistant Secretary for Housing-Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 200--299)
       III  Government National Mortgage Association, Department 
                of Housing and Urban Development (Parts 300--399)
         V  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 500--599)
        VI  Office of Assistant Secretary for Community Planning 
                and Development, Department of Housing and Urban 
                Development (Parts 600--699) [Reserved]
       VII  Office of the Secretary, Department of Housing and 
                Urban Development (Housing Assistance Programs and 
                Public and Indian Housing Programs) (Parts 700--
                799)
      VIII  Office of the Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Section 8 Housing Assistance 
                Programs and Section 202 Direct Loan Program) 
                (Parts 800--899)
        IX  Office of Assistant Secretary for Public and Indian 
                Housing, Department of Housing and Urban 
                Development (Parts 900--999)
         X  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Interstate Land Sales 
                Registration Program) (Parts 1700--1799)
       XII  Office of Inspector General, Department of Housing and 
                Urban Development (Parts 2000--2099)
        XX  Office of Assistant Secretary for Housing--Federal 
                Housing Commissioner, Department of Housing and 
                Urban Development (Parts 3200--3899)
       XXV  Neighborhood Reinvestment Corporation (Parts 4100--
                4199)

                           Title 25--Indians

         I  Bureau of Indian Affairs, Department of the Interior 
                (Parts 1--299)
        II  Indian Arts and Crafts Board, Department of the 
                Interior (Parts 300--399)
       III  National Indian Gaming Commission, Department of the 
                Interior (Parts 500--599)
        IV  Office of Navajo and Hopi Indian Relocation (Parts 
                700--799)
         V  Bureau of Indian Affairs, Department of the Interior, 
                and Indian Health Service, Department of Health 
                and Human Services (Part 900)
        VI  Office of the Assistant Secretary-Indian Affairs, 
                Department of the Interior (Part 1001)

[[Page 643]]

       VII  Office of the Special Trustee for American Indians, 
                Department of the Interior (Part 1200)

                      Title 26--Internal Revenue

         I  Internal Revenue Service, Department of the Treasury 
                (Parts 1--799)

           Title 27--Alcohol, Tobacco Products and Firearms

         I  Bureau of Alcohol, Tobacco and Firearms, Department of 
                the Treasury (Parts 1--299)

                   Title 28--Judicial Administration

         I  Department of Justice (Parts 0--199)
       III  Federal Prison Industries, Inc., Department of Justice 
                (Parts 300--399)
         V  Bureau of Prisons, Department of Justice (Parts 500--
                599)
        VI  Offices of Independent Counsel, Department of Justice 
                (Parts 600--699)
       VII  Office of Independent Counsel (Parts 700--799)

                            Title 29--Labor

            Subtitle A--Office of the Secretary of Labor (Parts 
                0--99)
            Subtitle B--Regulations Relating to Labor
         I  National Labor Relations Board (Parts 100--199)
        II  Office of Labor-Management Standards, Department of 
                Labor (Parts 200--299)
       III  National Railroad Adjustment Board (Parts 300--399)
        IV  Office of Labor-Management Standards, Department of 
                Labor (Parts 400--499)
         V  Wage and Hour Division, Department of Labor (Parts 
                500--899)
        IX  Construction Industry Collective Bargaining Commission 
                (Parts 900--999)
         X  National Mediation Board (Parts 1200--1299)
       XII  Federal Mediation and Conciliation Service (Parts 
                1400--1499)
       XIV  Equal Employment Opportunity Commission (Parts 1600--
                1699)
      XVII  Occupational Safety and Health Administration, 
                Department of Labor (Parts 1900--1999)
        XX  Occupational Safety and Health Review Commission 
                (Parts 2200--2499)
       XXV  Pension and Welfare Benefits Administration, 
                Department of Labor (Parts 2500--2599)
     XXVII  Federal Mine Safety and Health Review Commission 
                (Parts 2700--2799)
        XL  Pension Benefit Guaranty Corporation (Parts 4000--
                4999)

[[Page 644]]

                      Title 30--Mineral Resources

         I  Mine Safety and Health Administration, Department of 
                Labor (Parts 1--199)
        II  Minerals Management Service, Department of the 
                Interior (Parts 200--299)
       III  Board of Surface Mining and Reclamation Appeals, 
                Department of the Interior (Parts 300--399)
        IV  Geological Survey, Department of the Interior (Parts 
                400--499)
        VI  Bureau of Mines, Department of the Interior (Parts 
                600--699)
       VII  Office of Surface Mining Reclamation and Enforcement, 
                Department of the Interior (Parts 700--999)

                 Title 31--Money and Finance: Treasury

            Subtitle A--Office of the Secretary of the Treasury 
                (Parts 0--50)
            Subtitle B--Regulations Relating to Money and Finance
         I  Monetary Offices, Department of the Treasury (Parts 
                51--199)
        II  Fiscal Service, Department of the Treasury (Parts 
                200--399)
        IV  Secret Service, Department of the Treasury (Parts 
                400--499)
         V  Office of Foreign Assets Control, Department of the 
                Treasury (Parts 500--599)
        VI  Bureau of Engraving and Printing, Department of the 
                Treasury (Parts 600--699)
       VII  Federal Law Enforcement Training Center, Department of 
                the Treasury (Parts 700--799)
      VIII  Office of International Investment, Department of the 
                Treasury (Parts 800--899)

                      Title 32--National Defense

            Subtitle A--Department of Defense
         I  Office of the Secretary of Defense (Parts 1--399)
         V  Department of the Army (Parts 400--699)
        VI  Department of the Navy (Parts 700--799)
       VII  Department of the Air Force (Parts 800--1099)
            Subtitle B--Other Regulations Relating to National 
                Defense
       XII  Defense Logistics Agency (Parts 1200--1299)
       XVI  Selective Service System (Parts 1600--1699)
       XIX  Central Intelligence Agency (Parts 1900--1999)
        XX  Information Security Oversight Office, National 
                Archives and Records Administration (Parts 2000--
                2099)
       XXI  National Security Council (Parts 2100--2199)
      XXIV  Office of Science and Technology Policy (Parts 2400--
                2499)
     XXVII  Office for Micronesian Status Negotiations (Parts 
                2700--2799)
    XXVIII  Office of the Vice President of the United States 
                (Parts 2800--2899)
      XXIX  Presidential Commission on the Assignment of Women in 
                the Armed Forces (Part 2900)

[[Page 645]]

               Title 33--Navigation and Navigable Waters

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Corps of Engineers, Department of the Army (Parts 
                200--399)
        IV  Saint Lawrence Seaway Development Corporation, 
                Department of Transportation (Parts 400--499)

                          Title 34--Education

            Subtitle A--Office of the Secretary, Department of 
                Education (Parts 1--99)
            Subtitle B--Regulations of the Offices of the 
                Department of Education
         I  Office for Civil Rights, Department of Education 
                (Parts 100--199)
        II  Office of Elementary and Secondary Education, 
                Department of Education (Parts 200--299)
       III  Office of Special Education and Rehabilitative 
                Services, Department of Education (Parts 300--399)
        IV  Office of Vocational and Adult Education, Department 
                of Education (Parts 400--499)
         V  Office of Bilingual Education and Minority Languages 
                Affairs, Department of Education (Parts 500--599)
        VI  Office of Postsecondary Education, Department of 
                Education (Parts 600--699)
       VII  Office of Educational Research and Improvement, 
                Department of Education (Parts 700--799)
        XI  National Institute for Literacy (Parts 1100-1199)
            Subtitle C--Regulations Relating to Education
       XII  National Council on Disability (Parts 1200--1299)

                        Title 35--Panama Canal

         I  Panama Canal Regulations (Parts 1--299)

             Title 36--Parks, Forests, and Public Property

         I  National Park Service, Department of the Interior 
                (Parts 1--199)
        II  Forest Service, Department of Agriculture (Parts 200--
                299)
       III  Corps of Engineers, Department of the Army (Parts 
                300--399)
        IV  American Battle Monuments Commission (Parts 400--499)
         V  Smithsonian Institution (Parts 500--599)
       VII  Library of Congress (Parts 700--799)
      VIII  Advisory Council on Historic Preservation (Parts 800--
                899)
        IX  Pennsylvania Avenue Development Corporation (Parts 
                900--999)
        XI  Architectural and Transportation Barriers Compliance 
                Board (Parts 1100--1199)
       XII  National Archives and Records Administration (Parts 
                1200--1299)
       XIV  Assassination Records Review Board (Parts 1400-1499)

[[Page 646]]

             Title 37--Patents, Trademarks, and Copyrights

         I  Patent and Trademark Office, Department of Commerce 
                (Parts 1--199)
        II  Copyright Office, Library of Congress (Parts 200--299)
        IV  Assistant Secretary for Technology Policy, Department 
                of Commerce (Parts 400--499)
         V  Under Secretary for Technology, Department of Commerce 
                (Parts 500--599)

           Title 38--Pensions, Bonuses, and Veterans' Relief

         I  Department of Veterans Affairs (Parts 0--99)

                       Title 39--Postal Service

         I  United States Postal Service (Parts 1--999)
       III  Postal Rate Commission (Parts 3000--3099)

                  Title 40--Protection of Environment

         I  Environmental Protection Agency (Parts 1--799)
         V  Council on Environmental Quality (Parts 1500--1599)

          Title 41--Public Contracts and Property Management

            Subtitle B--Other Provisions Relating to Public 
                Contracts
        50  Public Contracts, Department of Labor (Parts 50-1--50-
                999)
        51  Committee for Purchase From People Who Are Blind or 
                Severely Disabled (Parts 51-1--51-99)
        60  Office of Federal Contract Compliance Programs, Equal 
                Employment Opportunity, Department of Labor (Parts 
                60-1--60-999)
        61  Office of the Assistant Secretary for Veterans 
                Employment and Training, Department of Labor 
                (Parts 61-1--61-999)
            Subtitle C--Federal Property Management Regulations 
                System
       101  Federal Property Management Regulations (Parts 101-1--
                101-99)
       105  General Services Administration (Parts 105-1--105-999)
       109  Department of Energy Property Management Regulations 
                (Parts 109-1--109-99)
       114  Department of the Interior (Parts 114-1--114-99)
       115  Environmental Protection Agency (Parts 115-1--115-99)
       128  Department of Justice (Parts 128-1--128-99)
            Subtitle D--Other Provisions Relating to Property 
                Management [Reserved]
            Subtitle E--Federal Information Resources Management 
                Regulations System
       201  Federal Information Resources Management Regulation 
                (Parts 201-1--201-99) [Reserved]
            Subtitle F--Federal Travel Regulation System
       301  Travel Allowances (Parts 301-1--301-99)
       302  Relocation Allowances (Parts 302-1--302-99)

[[Page 647]]

       303  Payment of Expenses Connected with the Death of 
                Certain Employees (Parts 303-1--303-2)
       304  Payment from a Non-Federal Source for Travel Expenses 
                (Parts 304-1--304-99)

                        Title 42--Public Health

         I  Public Health Service, Department of Health and Human 
                Services (Parts 1--199)
        IV  Health Care Financing Administration, Department of 
                Health and Human Services (Parts 400--499)
         V  Office of Inspector General-Health Care, Department of 
                Health and Human Services (Parts 1000--1999)

                   Title 43--Public Lands: Interior

            Subtitle A--Office of the Secretary of the Interior 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Lands
         I  Bureau of Reclamation, Department of the Interior 
                (Parts 200--499)
        II  Bureau of Land Management, Department of the Interior 
                (Parts 1000--9999)
       III  Utah Reclamation Mitigation and Conservation 
                Commission (Parts 10000--10005)

             Title 44--Emergency Management and Assistance

         I  Federal Emergency Management Agency (Parts 0--399)
        IV  Department of Commerce and Department of 
                Transportation (Parts 400--499)

                       Title 45--Public Welfare

            Subtitle A--Department of Health and Human Services 
                (Parts 1--199)
            Subtitle B--Regulations Relating to Public Welfare
        II  Office of Family Assistance (Assistance Programs), 
                Administration for Children and Families, 
                Department of Health and Human Services (Parts 
                200--299)
       III  Office of Child Support Enforcement (Child Support 
                Enforcement Program), Administration for Children 
                and Families, Department of Health and Human 
                Services (Parts 300--399)
        IV  Office of Refugee Resettlement, Administration for 
                Children and Families Department of Health and 
                Human Services (Parts 400--499)
         V  Foreign Claims Settlement Commission of the United 
                States, Department of Justice (Parts 500--599)
        VI  National Science Foundation (Parts 600--699)
       VII  Commission on Civil Rights (Parts 700--799)
      VIII  Office of Personnel Management (Parts 800--899)

[[Page 648]]

         X  Office of Community Services, Administration for 
                Children and Families, Department of Health and 
                Human Services (Parts 1000--1099)
        XI  National Foundation on the Arts and the Humanities 
                (Parts 1100--1199)
       XII  ACTION (Parts 1200--1299)
      XIII  Office of Human Development Services, Department of 
                Health and Human Services (Parts 1300--1399)
       XVI  Legal Services Corporation (Parts 1600--1699)
      XVII  National Commission on Libraries and Information 
                Science (Parts 1700--1799)
     XVIII  Harry S. Truman Scholarship Foundation (Parts 1800--
                1899)
       XXI  Commission on Fine Arts (Parts 2100--2199)
      XXII  Christopher Columbus Quincentenary Jubilee Commission 
                (Parts 2200--2299)
     XXIII  Arctic Research Commission (Part 2301)
      XXIV  James Madison Memorial Fellowship Foundation (Parts 
                2400--2499)
       XXV  Corporation for National and Community Service (Parts 
                2500--2599)

                          Title 46--Shipping

         I  Coast Guard, Department of Transportation (Parts 1--
                199)
        II  Maritime Administration, Department of Transportation 
                (Parts 200--399)
        IV  Federal Maritime Commission (Parts 500--599)

                      Title 47--Telecommunication

         I  Federal Communications Commission (Parts 0--199)
        II  Office of Science and Technology Policy and National 
                Security Council (Parts 200--299)
       III  National Telecommunications and Information 
                Administration, Department of Commerce (Parts 
                300--399)

           Title 48--Federal Acquisition Regulations System

         1  Federal Acquisition Regulation (Parts 1--99)
         2  Department of Defense (Parts 200--299)
         3  Department of Health and Human Services (Parts 300--
                399)
         4  Department of Agriculture (Parts 400--499)
         5  General Services Administration (Parts 500--599)
         6  Department of State (Parts 600--699)
         7  United States Agency for International Development 
                (Parts 700--799)
         8  Department of Veterans Affairs (Parts 800--899)
         9  Department of Energy (Parts 900--999)
        10  Department of the Treasury (Parts 1000--1099)

[[Page 649]]

        12  Department of Transportation (Parts 1200--1299)
        13  Department of Commerce (Parts 1300--1399)
        14  Department of the Interior (Parts 1400--1499)
        15  Environmental Protection Agency (Parts 1500--1599)
        16  Office of Personnel Management Federal Employees 
                Health Benefits Acquisition Regulation (Parts 
                1600--1699)
        17  Office of Personnel Management (Parts 1700--1799)
        18  National Aeronautics and Space Administration (Parts 
                1800--1899)
        19  United States Information Agency (Parts 1900--1999)
        20  Nuclear Regulatory Commission (Parts 2000--2099)
        21  Office of Personnel Management, Federal Employees 
                Group Life Insurance Federal Acquisition 
                Regulation (Parts 2100--2199)
        23  Social Security Administration (Parts 2300--2399)
        24  Department of Housing and Urban Development (Parts 
                2400--2499)
        25  National Science Foundation (Parts 2500--2599)
        28  Department of Justice (Parts 2800--2899)
        29  Department of Labor (Parts 2900--2999)
        34  Department of Education Acquisition Regulation (Parts 
                3400--3499)
        35  Panama Canal Commission (Parts 3500--3599)
        44  Federal Emergency Management Agency (Parts 4400--4499)
        51  Department of the Army Acquisition Regulations (Parts 
                5100--5199)
        52  Department of the Navy Acquisition Regulations (Parts 
                5200--5299)
        53  Department of the Air Force Federal Acquisition 
                Regulation Supplement (Parts 5300--5399)
        54  Defense Logistics Agency, Department of Defense (Part 
                5452)
        57  African Development Foundation (Parts 5700--5799)
        61  General Services Administration Board of Contract 
                Appeals (Parts 6100--6199)
        63  Department of Transportation Board of Contract Appeals 
                (Parts 6300--6399)
        99  Cost Accounting Standards Board, Office of Federal 
                Procurement Policy, Office of Management and 
                Budget (Parts 9900--9999)

                       Title 49--Transportation

            Subtitle A--Office of the Secretary of Transportation 
                (Parts 1--99)
            Subtitle B--Other Regulations Relating to 
                Transportation
         I  Research and Special Programs Administration, 
                Department of Transportation (Parts 100--199)
        II  Federal Railroad Administration, Department of 
                Transportation (Parts 200--299)

[[Page 650]]

       III  Federal Highway Administration, Department of 
                Transportation (Parts 300--399)
        IV  Coast Guard, Department of Transportation (Parts 400--
                499)
         V  National Highway Traffic Safety Administration, 
                Department of Transportation (Parts 500--599)
        VI  Federal Transit Administration, Department of 
                Transportation (Parts 600--699)
       VII  National Railroad Passenger Corporation (AMTRAK) 
                (Parts 700--799)
      VIII  National Transportation Safety Board (Parts 800--999)
         X  Surface Transportation Board, Department of 
                Transportation (Parts 1000--1399)

                   Title 50--Wildlife and Fisheries

         I  United States Fish and Wildlife Service, Department of 
                the Interior (Parts 1--199)
        II  National Marine Fisheries Service, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 200--299)
       III  International Fishing and Related Activities (Parts 
                300--399)
        IV  Joint Regulations (United States Fish and Wildlife 
                Service, Department of the Interior and National 
                Marine Fisheries Service, National Oceanic and 
                Atmospheric Administration, Department of 
                Commerce); Endangered Species Committee 
                Regulations (Parts 400--499)
         V  Marine Mammal Commission (Parts 500--599)
        VI  Fishery Conservation and Management, National Oceanic 
                and Atmospheric Administration, Department of 
                Commerce (Parts 600--699)

                      CFR Index and Finding Aids

            Subject/Agency Index
            List of Agency Prepared Indexes
            Parallel Tables of Statutory Authorities and Rules
            Acts Requiring Publication in the Federal Register
            List of CFR Titles, Chapters, Subchapters, and Parts
            Alphabetical List of Agencies Appearing in the CFR



[[Page 651]]





           Alphabetical List of Agencies Appearing in the CFR




                   (Revised as of September 30, 1997)

                                                  CFR Title, Subtitle or 
                     Agency                               Chapter

ACTION                                            45, XII
Administrative Committee of the Federal Register  1, I
Advanced Research Projects Agency                 32, I
Advisory Commission on Intergovernmental          5, VII
     Relations
Advisory Committee on Federal Pay                 5, IV
Advisory Council on Historic Preservation         36, VIII
African Development Foundation                    22, XV
  Federal Acquisition Regulation                  48, 57
Agency for International Development, United      22, II
     States
  Federal Acquisition Regulation                  48, 7
Agricultural Marketing Service                    7, I, IX, X, XI
Agricultural Research Service                     7, V
Agriculture Department
  Agricultural Marketing Service                  7, I, IX, X, XI
  Agricultural Research Service                   7, V
  Animal and Plant Health Inspection Service      7, III; 9, I
  Chief Financial Officer, Office of              7, XXX
  Commodity Credit Corporation                    7, XIV
  Cooperative State Research, Education, and      7, XXXIV
       Extension Service
  Economic Research Service                       7, XXXVII
  Energy, Office of                               7, XXIX
  Environmental Quality, Office of                7, XXXI
  Farm Service Agency                             7, VII, XVIII
  Federal Acquisition Regulation                  48, 4
  Federal Crop Insurance Corporation              7, IV
  Food and Consumer Service                       7, II
  Food Safety and Inspection Service              9, III
  Foreign Agricultural Service                    7, XV
  Forest Service                                  36, II
  Grain Inspection, Packers and Stockyards        7, VIII; 9, II
       Administration
  Information Resources Management, Office of     7, XXVII
  Inspector General, Office of                    7, XXVI
  National Agricultural Library                   7, XLI
  National Agricultural Statistics Service        7, XXXVI
  Natural Resources Conservation Service          7, VI
  Operations, Office of                           7, XXVIII
  Rural Business-Cooperative Service              7, XVIII, XLII
  Rural Development Administration                7, XLII
  Rural Housing Service                           7, XVIII, XXXV
  Rural Telephone Bank                            7, XVI
  Rural Utilities Service                         7, XVII, XVIII, XLII
  Secretary of Agriculture, Office of             7, Subtitle A
  Transportation, Office of                       7, XXXIII
  World Agricultural Outlook Board                7, XXXVIII
Air Force Department                              32, VII
  Federal Acquisition Regulation Supplement       48, 53
Alaska Natural Gas Transportation System, Office  10, XV
     of the Federal Inspector
Alcohol, Tobacco and Firearms, Bureau of          27, I
AMTRAK                                            49, VII
American Battle Monuments Commission              36, IV
American Indians, Office of the Special Trustee   25, VII

[[Page 652]]

Animal and Plant Health Inspection Service        7, III; 9, I
Appalachian Regional Commission                   5, IX
Architectural and Transportation Barriers         36, XI
     Compliance Board
Arctic Research Commission                        45, XXIII
Armed Forces Retirement Home                      5, XI
Arms Control and Disarmament Agency, United       22, VI
     States
Army Department                                   32, V
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 51
Assassination Records Review Board                36, XIV
Benefits Review Board                             20, VII
Bilingual Education and Minority Languages        34, V
     Affairs, Office of
Blind or Severely Disabled, Committee for         41, 51
     Purchase From People Who Are
Board for International Broadcasting              22, XIII
Census Bureau                                     15, I
Central Intelligence Agency                       32, XIX
Chief Financial Officer, Office of                7, XXX
Child Support Enforcement, Office of              45, III
Children and Families, Administration for         45, II, III, IV, X
Christopher Columbus Quincentenary Jubilee        45, XXII
     Commission
Civil Rights, Commission on                       45, VII
Civil Rights, Office for                          34, I
Coast Guard                                       33, I; 46, I; 49, IV
Commerce Department                               44, IV
  Census Bureau                                   15, I`
  Economic Affairs, Under Secretary               37, V
  Economic Analysis, Bureau of                    15, VIII
  Economic Development Administration             13, III
  Emergency Management and Assistance             44, IV
  Export Administration, Bureau of                15, VII
  Federal Acquisition Regulation                  48, 13
  Fishery Conservation and Management             50, VI
  Foreign-Trade Zones Board                       15, IV
  International Trade Administration              15, III; 19, III
  National Institute of Standards and Technology  15, II
  National Marine Fisheries Service               50, II, IV
  National Oceanic and Atmospheric                15, IX; 50, II, III, IV, 
       Administration                             VI
  National Telecommunications and Information     15, XXIII; 47, III
       Administration
  National Weather Service                        15, IX
  Patent and Trademark Office                     37, I
  Productivity, Technology and Innovation,        37, IV
       Assistant Secretary for
  Secretary of Commerce, Office of                15, Subtitle A
  Technology, Under Secretary for                 37, V
  Technology Administration                       15, XI
  Technology Policy, Assistant Secretary for      37, IV
Commercial Space Transportation                   14, III
Commodity Credit Corporation                      7, XIV
Commodity Futures Trading Commission              5, XLI; 17, I
Community Planning and Development, Office of     24, V, VI
     Assistant Secretary for
Community Services, Office of                     45, X
Comptroller of the Currency                       12, I
Construction Industry Collective Bargaining       29, IX
     Commission
Consumer Product Safety Commission                5, LXXI; 16, II
Cooperative State Research, Education, and        7, XXXIV
     Extension Service
Copyright Office                                  37, II
Cost Accounting Standards Board                   48, 99
Council on Environmental Quality                  40, V
Customs Service, United States                    19, I
Defense Contract Audit Agency                     32, I
Defense Department                                5, XXVI; 32, Subtitle A
  Advanced Research Projects Agency               32, I
  Air Force Department                            32, VII

[[Page 653]]

  Army Department                                 32, V; 33, II; 36, III, 
                                                  48, 51
  Defense Intelligence Agency                     32, I
  Defense Logistics Agency                        32, I, XII; 48, 54
  Defense Mapping Agency                          32, I
  Engineers, Corps of                             33, II; 36, III
  Federal Acquisition Regulation                  48, 2
  Navy Department                                 32, VI; 48, 52
  Secretary of Defense, Office of                 32, I
Defense Contract Audit Agency                     32, I
Defense Intelligence Agency                       32, I
Defense Logistics Agency                          32, XII; 48, 54
Defense Mapping Agency                            32, I
Defense Nuclear Facilities Safety Board           10, XVII
Delaware River Basin Commission                   18, III
Drug Enforcement Administration                   21, II
East-West Foreign Trade Board                     15, XIII
Economic Affairs, Under Secretary                 37, V
Economic Analysis, Bureau of                      15, VIII
Economic Development Administration               13, III
Economic Research Service                         7, XXXVII
Education, Department of                          5, LIII
  Bilingual Education and Minority Languages      34, V
       Affairs, Office of
  Civil Rights, Office for                        34, I
  Educational Research and Improvement, Office    34, VII
       of
  Elementary and Secondary Education, Office of   34, II
  Federal Acquisition Regulation                  48, 34
  Postsecondary Education, Office of              34, VI
  Secretary of Education, Office of               34, Subtitle A
  Special Education and Rehabilitative Services,  34, III
       Office of
  Vocational and Adult Education, Office of       34, IV
Educational Research and Improvement, Office of   34, VII
Elementary and Secondary Education, Office of     34, II
Employees' Compensation Appeals Board             20, IV
Employees Loyalty Board                           5, V
Employment and Training Administration            20, V
Employment Standards Administration               20, VI
Endangered Species Committee                      50, IV
Energy, Department of                             5, XXIII; 10, II, III, X
  Federal Acquisition Regulation                  48, 9
  Federal Energy Regulatory Commission            5, XXIV; 18, I
  Property Management Regulations                 41, 109
Energy, Office of                                 7, XXIX
Engineers, Corps of                               33, II; 36, III
Engraving and Printing, Bureau of                 31, VI
Enrichment Corporation, United States             10, XI
Environmental Protection Agency                   5, LIV; 40, I
  Federal Acquisition Regulation                  48, 15
  Property Management Regulations                 41, 115
Environmental Quality, Office of                  7, XXXI
Equal Employment Opportunity Commission           5, LXII; 29, XIV
Equal Opportunity, Office of Assistant Secretary  24, I
     for
Executive Office of the President                 3, I
  Administration, Office of                       5, XV
  Environmental Quality, Council on               40, V
  Management and Budget, Office of                25, III, LXXVII; 48, 99
  National Drug Control Policy, Office of         21, III
  National Security Council                       32, XXI; 47, 2
  Presidential Documents                          3
  Science and Technology Policy, Office of        32, XXIV; 47, II
  Trade Representative, Office of the United      15, XX
       States
Export Administration, Bureau of                  15, VII
Export-Import Bank of the United States           5, LII; 12, IV
Family Assistance, Office of                      45, II
Farm Credit Administration                        5, XXXI; 12, VI
Farm Credit System Insurance Corporation          5, XXX; 12, XIV

[[Page 654]]

Farm Service Agency                               7, VII, XVIII
Federal Acquisition Regulation                    48, 1
Federal Aviation Administration                   14, I
  Commercial Space Transportation                 14, III
Federal Claims Collection Standards               4, II
Federal Communications Commission                 5, XXIX; 47, I
Federal Contract Compliance Programs, Office of   41, 60
Federal Crop Insurance Corporation                7, IV
Federal Deposit Insurance Corporation             5, XXII; 12, III
Federal Election Commission                       11, I
Federal Emergency Management Agency               44, I
  Federal Acquisition Regulation                  48, 44
Federal Employees Group Life Insurance Federal    48, 21
     Acquisition Regulation
Federal Employees Health Benefits Acquisition     48, 16
     Regulation
Federal Energy Regulatory Commission              5, XXIV; 18, I
Federal Financial Institutions Examination        12, XI
     Council
Federal Financing Bank                            12, VIII
Federal Highway Administration                    23, I, II; 49, III
Federal Home Loan Mortgage Corporation            1, IV
Federal Housing Enterprise Oversight Office       12, XVII
Federal Housing Finance Board                     12, IX
Federal Inspector for the Alaska Natural Gas      10, XV
     Transportation System, Office of
Federal Labor Relations Authority, and General    5, XIV; 22, XIV
     Counsel of the Federal Labor Relations 
     Authority
Federal Law Enforcement Training Center           31, VII
Federal Maritime Commission                       46, IV
Federal Mediation and Conciliation Service        29, XII
Federal Mine Safety and Health Review Commission  5, LXXIV; 29, XXVII
Federal Pay, Advisory Committee on                5, IV
Federal Prison Industries, Inc.                   28, III
Federal Procurement Policy Office                 48, 99
Federal Property Management Regulations           41, 101
Federal Property Management Regulations System    41, Subtitle C
Federal Railroad Administration                   49, II
Federal Register, Administrative Committee of     1, I
Federal Register, Office of                       1, II
Federal Reserve System                            12, II
  Board of Governors                              5, LVIII
Federal Retirement Thrift Investment Board        5, VI, LXXVI
Federal Service Impasses Panel                    5, XIV
Federal Trade Commission                          5, XLVII; 16, I
Federal Transit Administration                    49, VI
Federal Travel Regulation System                  41, Subtitle F
Fine Arts, Commission on                          45, XXI
Fiscal Service                                    31, II
Fish and Wildlife Service, United States          50, I, IV
Fishery Conservation and Management               50, VI
Food and Drug Administration                      21, I
Food and Consumer Service                         7, II
Food Safety and Inspection Service                9, III
Foreign Agricultural Service                      7, XV
Foreign Assets Control, Office of                 31, V
Foreign Claims Settlement Commission of the       45, V
     United States
Foreign Service Grievance Board                   22, IX
Foreign Service Impasse Disputes Panel            22, XIV
Foreign Service Labor Relations Board             22, XIV
Foreign-Trade Zones Board                         15, IV
Forest Service                                    36, II
General Accounting Office                         4, I, II
General Services Administration                   5, LVII
  Contract Appeals, Board of                      48, 61
  Federal Acquisition Regulation                  48, 5
  Federal Property Management Regulations System  41, 101, 105
  Federal Travel Regulation System                41, Subtitle F
  Payment From a Non-Federal Source for Travel    41, 304
     Expenses
[[Page 655]]

  Payment of Expenses Connected With the Death    41, 303
       of Certain Employees
  Relocation Allowances                           41, 302
  Travel Allowances                               41, 301
Geological Survey                                 30, IV
Government Ethics, Office of                      5, XVI
Government National Mortgage Association          24, III
Grain Inspection, Packers and Stockyards          7, VIII; 9, II
     Administration
Great Lakes Pilotage                              46, III
Harry S. Truman Scholarship Foundation            45, XVIII
Health and Human Services, Department of          5, XLV; 45, Subtitle A
  Child Support Enforcement, Office of            45, III
  Children and Families, Administration for       45, II, III, IV, X
  Community Services, Office of                   45, X
  Family Assistance, Office of                    45, II
  Federal Acquisition Regulation                  48, 3
  Food and Drug Administration                    21, I
  Health Care Financing Administration            42, IV
  Human Development Services, Office of           45, XIII
  Indian Health Service                           25, V
  Inspector General (Health Care), Office of      42, V
  Public Health Service                           42, I
  Refugee Resettlement, Office of                 45, IV
Health Care Financing Administration              42, IV
Housing and Urban Development, Department of      5, LXV; 24, Subtitle B
  Community Planning and Development, Office of   24, V, VI
       Assistant Secretary for
  Equal Opportunity, Office of Assistant          24, I
       Secretary for
  Federal Acquisition Regulation                  48, 24
  Federal Housing Enterprise Oversight, Office    12, XVII
       of
  Government National Mortgage Association        24, III
  Housing--Federal Housing Commissioner, Office   24, II, VIII, X, XX
       of Assistant Secretary for
  Inspector General, Office of                    24, XII
  Public and Indian Housing, Office of Assistant  24, IX
       Secretary for
  Secretary, Office of                            24, Subtitle A, VII
Housing--Federal Housing Commissioner, Office of  24, II, VIII, X, XX
     Assistant Secretary for
Human Development Services, Office of             45, XIII
Immigration and Naturalization Service            8, I
Independent Counsel, Office of                    28, VII
Indian Affairs, Bureau of                         25, I, V
Indian Affairs, Office of the Assistant           25, VI
     Secretary
Indian Arts and Crafts Board                      25, II
Indian Health Service                             25, V
Information Agency, United States                 22, V
  Federal Acquisition Regulation                  48, 19
Information Resources Management, Office of       7, XXVII
Information Security Oversight Office, National   32, XX
     Archives and Records Administration
Inspector General
  Agriculture Department                          7, XXVI
  Health and Human Services Department            42, V
  Housing and Urban Development Department        24, XII
Institute of Peace, United States                 22, XVII
Inter-American Foundation                         5, LXIII; 22, X
Intergovernmental Relations, Advisory Commission  5, VII
     on
Interior Department
  American Indians, Office of the Special         25, VII
       Trustee
  Endangered Species Committee                    50, IV
  Federal Acquisition Regulation                  48, 14
  Federal Property Management Regulations System  41, 114
  Fish and Wildlife Service, United States        50, I, IV
  Geological Survey                               30, IV
  Indian Affairs, Bureau of                       25, I, V
  Indian Affairs, Office of the Assistant         25, VI
       Secretary
  Indian Arts and Crafts Board                    25, II

[[Page 656]]

  Land Management, Bureau of                      43, II
  Minerals Management Service                     30, II
  Mines, Bureau of                                30, VI
  National Indian Gaming Commission               25, III
  National Park Service                           36, I
  Reclamation, Bureau of                          43, I
  Secretary of the Interior, Office of            43, Subtitle A
  Surface Mining and Reclamation Appeals, Board   30, III
       of
  Surface Mining Reclamation and Enforcement,     30, VII
       Office of
Internal Revenue Service                          26, I
International Boundary and Water Commission,      22, XI
     United States and Mexico, United States 
     Section
International Development, United States Agency   22, II
     for
  Federal Acquisition Regulation                  48, 7
International Development Cooperation Agency,     22, XII
     United States
  International Development, United States        22, II; 48, 7
       Agency for
  Overseas Private Investment Corporation         5, XXXIII; 22, VII
International Fishing and Related Activities      50, III
International Investment, Office of               31, VIII
International Joint Commission, United States     22, IV
     and Canada
International Organizations Employees Loyalty     5, V
     Board
International Trade Administration                15, III; 19, III
International Trade Commission, United States     19, II
Interstate Commerce Commission                    5, XL
James Madison Memorial Fellowship Foundation      45, XXIV
Japan-United States Friendship Commission         22, XVI
Joint Board for the Enrollment of Actuaries       20, VIII
Justice Department                                5, XXVIII; 28, I
  Drug Enforcement Administration                 21, II
  Federal Acquisition Regulation                  48, 28
  Federal Claims Collection Standards             4, II
  Federal Prison Industries, Inc.                 28, III
  Foreign Claims Settlement Commission of the     45, V
       United States
  Immigration and Naturalization Service          8, I
  Offices of Independent Counsel                  28, VI
  Prisons, Bureau of                              28, V
  Property Management Regulations                 41, 128
Labor Department                                  5, XLII
  Benefits Review Board                           20, VII
  Employees' Compensation Appeals Board           20, IV
  Employment and Training Administration          20, V
  Employment Standards Administration             20, VI
  Federal Acquisition Regulation                  48, 29
  Federal Contract Compliance Programs, Office    41, 60
       of
  Federal Procurement Regulations System          41, 50
  Labor-Management Standards, Office of           29, II, IV
  Mine Safety and Health Administration           30, I
  Occupational Safety and Health Administration   29, XVII
  Pension and Welfare Benefits Administration     29, XXV
  Public Contracts                                41, 50
  Secretary of Labor, Office of                   29, Subtitle A
  Veterans' Employment and Training, Office of    41, 61; 20, IX
       the Assistant Secretary for
  Wage and Hour Division                          29, V
  Workers' Compensation Programs, Office of       20, I
Labor-Management Standards, Office of             29, II, IV
Land Management, Bureau of                        43, II
Legal Services Corporation                        45, XVI
Library of Congress                               36, VII
  Copyright Office                                37, II
Management and Budget, Office of                  5, III, LXXVII; 48, 99
Marine Mammal Commission                          50, V
Maritime Administration                           46, II
Merit Systems Protection Board                    5, II
Micronesian Status Negotiations, Office for       32, XXVII

[[Page 657]]

Mine Safety and Health Administration             30, I
Minerals Management Service                       30, II
Mines, Bureau of                                  30, VI
Minority Business Development Agency              15, XIV
Miscellaneous Agencies                            1, IV
Monetary Offices                                  31, I
National Aeronautics and Space Administration     5, LIX; 14, V
  Federal Acquisition Regulation                  48, 18
National Agricultural Library                     7, XLI
National Agricultural Statistics Service          7, XXXVI
National Archives and Records Administration      5, LXVI; 36, XII
  Information Security Oversight Office           32, XX
National Bureau of Standards                      15, II
National Capital Planning Commission              1, IV
National Commission for Employment Policy         1, IV
National Commission on Libraries and Information  45, XVII
     Science
National and Community Service, Corporation for   45, XXV
National Council on Disability                    34, XII
National Credit Union Administration              12, VII
National Drug Control Policy, Office of           21, III
National Foundation on the Arts and the           45, XI
     Humanities
National Highway Traffic Safety Administration    23, II, III; 49, V
National Indian Gaming Commission                 25, III
National Institute for Literacy                   34, XI
National Institute of Standards and Technology    15, II
National Labor Relations Board                    5, LXI; 29, I
National Marine Fisheries Service                 50, II, IV
National Mediation Board                          29, X
National Oceanic and Atmospheric Administration   15, IX; 50, II, III, IV, 
                                                  VI
National Park Service                             36, I
National Railroad Adjustment Board                29, III
National Railroad Passenger Corporation (AMTRAK)  49, VII
National Science Foundation                       5, XLIII; 45, VI
  Federal Acquisition Regulation                  48, 25
National Security Council                         32, XXI
National Security Council and Office of Science   47, II
     and Technology Policy
National Telecommunications and Information       15, XXIII; 47, III
     Administration
National Transportation Safety Board              49, VIII
National Weather Service                          15, IX
Natural Resources Conservation Service            7, VI
Navajo and Hopi Indian Relocation, Office of      25, IV
Navy Department                                   32, VI
  Federal Acquisition Regulation                  48, 52
Neighborhood Reinvestment Corporation             24, XXV
Northeast Dairy Compact Commission                7, XIII
Nuclear Regulatory Commission                     5, XLVIII; 10, I
  Federal Acquisition Regulation                  48, 20
Occupational Safety and Health Administration     29, XVII
Occupational Safety and Health Review Commission  29, XX
Offices of Independent Counsel                    28, VI
Operations Office                                 7, XXVIII
Overseas Private Investment Corporation           5, XXXIII; 22, VII
Panama Canal Commission                           48, 35
Panama Canal Regulations                          35, I
Patent and Trademark Office                       37, I
Payment From a Non-Federal Source for Travel      41, 304
     Expenses
Payment of Expenses Connected With the Death of   41, 303
     Certain Employees
Peace Corps                                       22, III
Pennsylvania Avenue Development Corporation       36, IX
Pension and Welfare Benefits Administration       29, XXV
Pension Benefit Guaranty Corporation              29, XL
Personnel Management, Office of                   5, I, XXXV; 45, VIII
  Federal Acquisition Regulation                  48, 17
  Federal Employees Group Life Insurance Federal  48, 21
     Acquisition Regulation
[[Page 658]]

  Federal Employees Health Benefits Acquisition   48, 16
       Regulation
Postal Rate Commission                            5, XLVI; 39, III
Postal Service, United States                     5, LX; 39, I
Postsecondary Education, Office of                34, VI
President's Commission on White House             1, IV
     Fellowships
Presidential Commission on the Assignment of      32, XXIX
     Women in the Armed Forces
Presidential Documents                            3
Prisons, Bureau of                                28, V
Productivity, Technology and Innovation,          37, IV
     Assistant Secretary
Public Contracts, Department of Labor             41, 50
Public and Indian Housing, Office of Assistant    24, IX
     Secretary for
Public Health Service                             42, I
Railroad Retirement Board                         20, II
Reclamation, Bureau of                            43, I
Refugee Resettlement, Office of                   45, IV
Regional Action Planning Commissions              13, V
Relocation Allowances                             41, 302
Research and Special Programs Administration      49, I
Rural Business-Cooperative Service                7, XVIII, XLII
Rural Development Administration                  7, XLII
Rural Housing Service                             7, XVIII, XXXV
Rural Telephone Bank                              7, XVI
Rural Utilities Service                           7, XVII, XVIII, XLII
Saint Lawrence Seaway Development Corporation     33, IV
Science and Technology Policy, Office of          32, XXIV
Science and Technology Policy, Office of, and     47, II
     National Security Council
Secret Service                                    31, IV
Securities and Exchange Commission                17, II
Selective Service System                          32, XVI
Small Business Administration                     13, I
Smithsonian Institution                           36, V
Social Security Administration                    20, III; 48, 23
Soldiers' and Airmen's Home, United States        5, XI
Special Counsel, Office of                        5, VIII
Special Education and Rehabilitative Services,    34, III
     Office of
State Department                                  22, I
  Federal Acquisition Regulation                  48, 6
Surface Mining and Reclamation Appeals, Board of  30, III
Surface Mining Reclamation and Enforcement,       30, VII
     Office of
Surface Transportation Board                      49, X
Susquehanna River Basin Commission                18, VIII
Technology Administration                         15, XI
Technology Policy, Assistant Secretary for        37, IV
Technology, Under Secretary for                   37, V
Tennessee Valley Authority                        5, LXIX; 18, XIII
Thrift Depositor Protection Oversight Board       12, XV
Thrift Supervision Office, Department of the      12, V
     Treasury
Trade Representative, United States, Office of    15, XX
Transportation, Department of                     5, L
  Coast Guard                                     33, I; 46, I; 49, IV
  Commercial Space Transportation                 14, III
  Contract Appeals, Board of                      48, 63
  Emergency Management and Assistance             44, IV
  Federal Acquisition Regulation                  48, 12
  Federal Aviation Administration                 14, I
  Federal Highway Administration                  23, I, II; 49, III
  Federal Railroad Administration                 49, II
  Federal Transit Administration                  49, VI
  Maritime Administration                         46, II
  National Highway Traffic Safety Administration  23, II, III; 49, V
  Research and Special Programs Administration    49, I
  Saint Lawrence Seaway Development Corporation   33, IV
  Secretary of Transportation, Office of          14, II; 49, Subtitle A
  Surface Transportation Board                    49, X

[[Page 659]]

Transportation, Office of                         7, XXXIII
Travel Allowances                                 41, 301
Treasury Department                               5, XXI; 17, IV
  Alcohol, Tobacco and Firearms, Bureau of        27, I
  Community Development Financial Institutions    12, XVIII
       Fund
  Comptroller of the Currency                     12, I
  Customs Service, United States                  19, I
  Engraving and Printing, Bureau of               31, VI
  Federal Acquisition Regulation                  48, 10
  Federal Law Enforcement Training Center         31, VII
  Fiscal Service                                  31, II
  Foreign Assets Control, Office of               31, V
  Internal Revenue Service                        26, I
  International Investment, Office of             31, VIII
  Monetary Offices                                31, I
  Secret Service                                  31, IV
  Secretary of the Treasury, Office of            31, Subtitle A
  Thrift Supervision, Office of                   12, V
Truman, Harry S. Scholarship Foundation           45, XVIII
United States and Canada, International Joint     22, IV
     Commission
United States and Mexico, International Boundary  22, XI
     and Water Commission, United States Section
United States Enrichment Corporation              10, XI
Utah Reclamation Mitigation and Conservation      43, III
     Commission
Veterans Affairs Department                       38, I
  Federal Acquisition Regulation                  48, 8
Veterans' Employment and Training, Office of the  41, 61; 20, IX
     Assistant Secretary for
Vice President of the United States, Office of    32, XXVIII
Vocational and Adult Education, Office of         34, IV
Wage and Hour Division                            29, V
Water Resources Council                           18, VI
Workers' Compensation Programs, Office of         20, I
World Agricultural Outlook Board                  7, XXXVIII

[[Page 661]]



List of CFR Sections Affected



All changes in this volume of the Code of Federal Regulations which were 
made by documents published in the Federal Register since January 1, 
1986, are enumerated in the following list. Entries indicate the nature 
of the changes effected. Page numbers refer to Federal Register pages. 
The user should consult the entries for chapters and parts as well as 
sections for revisions.
For the period before January 1, 1986, see the ``List of CFR Sections 
Affected, 1949-1963, 1964-1972, and 1973-1985'' published in seven 
separate volumes.

                                  1986

44 CFR
                                                                   51 FR
                                                                    Page
Chapter I
2.2  Revised.........................................................194
2.12  Amended........................................................194
2.22  (b)(6) amended.................................................194
    (b)(6) correctly designated.....................................2499
2.52  (a) and (b) introductory text amended; (b)(7) removed..........194
2.54  (a) amended....................................................194
2.60  Revised........................................................194
2.63  (c)(4) removed.................................................194
2.73  Amended........................................................194
2.81  Table amended (OMB numbers)..................................34604
3  Authority citation revised......................................34604
3.15  (c) amended..................................................34604
5.3  (d) amended...................................................34604
5.54  (a)(6) amended...............................................34604
6  Authority citation revised......................................34604
6.2  (o) amended...................................................34604
6.33  (b)(6) amended...............................................34604
6.70  (a), (b), and (d) amended....................................34604
8.2  (c) removed; new (c) and (d) added............................34605
8.4  Amended.......................................................34605
9.5  (c) introductory text amended; (c)(14) added..................39531
9.7  (c)(1)(ii) amended............................................34605
11.30  (b)(6) revised; (b)(9) added................................34605
11.37  Removed.....................................................29223
11.54  (a) amended.................................................34605
14  Added..........................................................24347
25  Added.....................................................7020, 7022
59  Section authority citations removed............................30306
59.1  Amended......................................................30306
60.3  (a)(1) and (4), (b)(1) and (8), and (c)(2) amended; (a)(3), 
        (b)(3), (4), and (5), and (c)(5) and (6) revised; (b)(9), 
        (d)(4), and (e)(7) removed; (e)(8) redesignated as (e)(7) 
                                                                   30307
60.6  (a)(7) and (c) added; (b)(3) and (4) removed.................30308
60.25  Revised.....................................................30309
61  Section authority citations removed............................30309
61.3  Amended......................................................30309
61.5  (d) and (f)(4) and (8) amended; (f)(2) revised; (f)(9) 
        removed; (f)(10) and (11) redesignated as (f)(9) and (10); 
        new (f)(9) amended; eff. in Part 1-1-87....................30309
61.11  (e) amended.................................................30309
61.12  (b)(4) revised..............................................30310
61  Appendixes A(1) and A(2) amended; eff. in Part 1-1-87..........30310
    Appendix C removed.............................................30313
64.6  Table corrected..............................................1795,
                                                                   46862
    Table amended..................................................2499,
     3601, 6003, 6112, 10544, 12152, 12613, 15783, 19337, 20972, 21768, 
  23548, 25702, 27409, 28231, 28233, 30858, 30862, 31331, 33055, 34087, 
                                                                  36693,
                  36699, 39860, 41506, 42575, 43198, 45116, 46859, 46861

[[Page 662]]

    Table amended (removed at 51 FR 19066).........................17484
65  Authority citation revised.....................................30313
65.2  Revised......................................................30313
65.3  Revised......................................................30313
65.4  Table amended; interim.......................................4345,
                                       12154, 17485, 26549, 31951, 37277
    Table amended.......................4346, 12155, 26548, 31635, 37276
    Table corrected................................................40331
    Revised........................................................30313
65.5  Added........................................................30313
65.6  Added........................................................30314
65.7  Added........................................................30315
65.8  Added........................................................30315
65.9  Added........................................................30315
65.10  Added.......................................................30316
65.11  Added.......................................................30317
67.11  Flood elevation determinations..............................3959,
                   4347, 12156, 17486, 19182, 26550, 31952, 37278, 37280
    Flood elevation determinations corrected........................9191
68  Authority citation revised.....................................34605
70.1  Amended......................................................30317
70.3  (b)(2)(i) and (4) amended....................................30317
70.4  Amended......................................................30317
70.9  Added........................................................30318
73  Added..........................................................30318
76  Removed........................................................30318
77  Authority citation revised; section authority citations 
        removed....................................................34605
80  Authority citation revised.....................................34605
80.1  (a) (16) through (23) added..................................34605
    (b) revised....................................................44912
81  Authority citation revised; section authority citations 
        removed....................................................34605
82  Authority citation revised; section authority citations 
        removed....................................................34605
83  Authority citation revised; section authority citations 
        removed....................................................34605
205  Authority citation revised.............................13502, 13504
    Subpart A, C through K, and M, section, and paragraph 
authority citations removed........................................34606
205.1--205.17 (Subpart A)  Authority citation removed..............13502
205.10  Revised....................................................13502
205.42  (a)(2) amended.............................................34606
205.52  Revised....................................................13504
205.54  Revised; eff. 10-15-86.....................................32646
205.104  (b)(1)(iv) amended........................................34606
302  Authority citation revised....................................12520
302.2  (n), (o), and (u) amended; (p) revised......................12520
302.3  Introductory text, (a) (3), (15), and (18) amended; (b) 
        revised....................................................12520
302.5  (b)(5) amended; (f) through (j) revised; (k) through (m) 
        added......................................................12521
    (l) and (m) revised; (n) and (o) added.........................43924
302.8  Amended.....................................................12521
306  Authority citation revised....................................34606
308  Authority citation revised; section authority citations 
        removed....................................................34606
311  Removed.......................................................34606
325  Authority citation revised....................................34606
325.3  (a) amended.................................................34606
333  Authority citation revised....................................34606
333.2  Paragraphs designated as (a) and (b)........................34606
350  Authority citation revised....................................34606
350.3  (d) revised.................................................34606
351.3  Authority citation revised..................................34606
    (a) amended....................................................34606

                                  1987

44 CFR
                                                                   52 FR
                                                                    Page
Chapter I
5  Authority citation revised......................................13677
5.42  Revised......................................................13677
5.43  Revised......................................................13678
5.44  Revised......................................................13678
5.46  Revised......................................................13678
    (a) revised....................................................33410
5.71  (g) revised; (j) added.......................................13679
6.82  Amended......................................................13679
6.83  Revised......................................................13679
6.85  Revised......................................................13679
6.87  (a) and (b)(1) revised; (c) added.............................5114
10.8  (c)(2)(ix) added..............................................5285
25  Authority citation revised.....................................48026

[[Page 663]]

    Revised; eff. 4-2-89...........................................48026
25.1  Heading revised; (a) and (b) redesignated as (a) (1) and 
        (2); introductory text designated as new (a) introductory 
        text; new (a) heading and (b) added........................48026
59  Amendment effectiveness extended to 9-30-88....................33411
59.1  Amended; eff. to 3-31-88.....................................24372
60.3  (c)(6) suspended; (c)(12) added; eff. to 3-31-88.............24372
    (b)(4), (d)(1) and (e)(1) corrected; eff. to 9-30-88; (c)(6) 
suspension and (c)(12) addition effectiveness extended to 9-30-88 
                                                                   33411
61.9  Revised.......................................................5980
61  Appendixes A(3) and A(4) added.................................15500
64.6  Table amended................................................2530,
     2532, 3803, 6327, 10095, 10754, 12179, 13839, 17956, 19730, 20084, 
  22781, 23987, 24162, 26680, 28260, 28262, 29184, 31766, 35242, 36251, 
                  36936, 38231, 39920, 41713, 44128, 45335, 48686, 48818
    Table corrected................................................21794
65.4  Table amended................................................3239,
                                        3241, 22325, 29015, 37953, 46474
    Table amended; interim....................22323, 29014, 37955, 46475
65.11  Table amended................................................8902
    Table amended; interim..........................................8903
67  Flood elevation determinations.................................3241,
              4005, 8251, 8905, 22326, 26984, 29017, 36253, 37956, 46476
    Flood elevation determinations rescission.......................5981
80.4  (f) revised..................................................30684
80.6  Revised......................................................30684
81.1  (b) revised..................................................21036
    (d) revised....................................................30684
81.7a  Revised.....................................................30684
82.5  (e) revised..................................................30685
82.31  (f)(1) revised..............................................30685
83.4  Revised......................................................30686
83.5  (a) amended..................................................30686
83.21  (a) and (b) revised.........................................30686
83.24  (d) revised.................................................30686
83.26  (b) amended.................................................30687
222  Added..........................................................6800
361  Added.........................................................33818

                                  1988

44 CFR
                                                                   53 FR
                                                                    Page
Chapter I
8.2  (b)(2) and (c) revised; (b)(4) added..........................47210
5  Authority citation revised.......................................2740
5.52  (c) removed...................................................2740
5.57  Redesignated as 5.58; new 5.57 added..........................2740
5.58  Redesignated as 5.59; new 5.58 redesignated from 5.57.........2740
5.59  Redesignated as 5.60; new 5.59 redesignated from 5.58.........2740
5.60  Redesignated as 5.61; new 5.60 redesignated from 5.59.........2740
    Amended.........................................................2741
5.61  Redesignated from 5.60........................................2740
    Amended.........................................................2741
11.30  (b) revised.................................................47211
11.34  (c) added...................................................47211
11.35  Amended.....................................................47211
11.39  Removed.....................................................47211
11.42  (a) amended.................................................47211
11.44  Revised.....................................................47211
11.48  (a), (c), (d), (e)(5) and (h) introductory text and (1) 
        revised....................................................47211
11.50  (c) revised.................................................47212
11.51  (b)(4) and (c) amended......................................47212
11.54  (a) revised.................................................47212
13  Added.....................................................8078, 8087
    Technical correction............................................9317
16  Added..........................................................25885
16.170  (c) revised................................................25885
17  Added; eff. 10-1-88.....................................19199, 19204
    Nomenclature change; eff. 10-1-88..............................19200
17.105  (w) added; eff. 10-1-88....................................19200
59.1  Amended......................................................16276
    Amendment at 52 FR 24372 effectiveness extended to 7-31-89.....25332
    Amended; interim...............................................36975
60.3  (c)(13) and (d)(4) added; (d) (1) and (3) and (e)(1) amended
                                                                   16276
    (c)(6) suspension and (c)(12) addition at 52 FR 24372 
effectiveness extended to 7-31-89..................................25332
61.4  (c) amended..................................................16277
61.5  (f)(4) amended; (j) added....................................16277
    (f)(9) amended.................................................27991
61.9  Revised......................................................23632
61.11  (e) amended.................................................15211
61  Appendixes A(1) and A(2) amended........................16277, 27991

[[Page 664]]

    Appendix A(3) and A(4) removed.................................16279
62  Authority citation revised; section authority citations 
        removed.............................................15211, 16279
62.5  Amended......................................................16279
62.6  (a) revised..................................................15221
62.23  (c), (h)(5), and (j) (5), (7), and (8) amended; (j)(4) 
        revised....................................................15211
62  Appendixes A and B amended.....................................15211
    Appendix B corrected....................................26559, 39091
63  Added; interim.................................................36975
63.7  Amended; interim.............................................44193
63.17  (a) amended; interim........................................44193
64.6  Table amended...............................................40427,
                  43694, 44194, 46449, 47695, 47696, 49883, 50410, 51275
    Table corrected................................................47697
64.6  Table amended................................................1486,
   2742, 3209, 4408, 5177, 5273, 6149, 6150, 8458, 10088, 10091, 10092, 
  13269, 14796, 14799, 15395, 15556, 17946, 19908, 19910, 20847, 22173, 
  22174, 22177, 23763, 24726, 25592, 28207, 28211, 28214, 33133, 33136, 
                                       34088, 36978, 36980, 37301, 37304
    Table corrected...............................................22654,
                                                     27799, 29053, 37762
65.4  Table amended................................................5179,
                                                     22490, 28390, 36278
65.4  Table amended...............................................40730,
                                                     47813, 49883, 51553
    Table amended; interim.........................................5180,
                         22491, 28389, 31869, 36279, 40731, 47813, 51552
65.6  (a) (12) and (13) added......................................16279
65.11  Redesignated as 65.13; new 65.11 added......................16279
65.12  Added.......................................................16279
65.13  Redesignated from 65.11.....................................16279
67  Flood elevation determinations.................................2743,
    5181, 7915, 11510, 12152, 19783, 22493, 28216, 28223, 28391, 31869, 
                         31870, 36280, 36281, 40732, 47814, 51100, 51554
    Flood elevation determinations corrected.......................34089
70.3  (b)(2)(iv) amended; (b)(4) revised...........................16280
72  Authority citation revised.....................................16280
72.5  Amended......................................................16280
80.1  (a)(6) revised...............................................11276
82.1  (h), (i), (j), and (k) redesignated as (i), (j), (k), and 
        (l); new (h) and (m) added.................................11276
83.4  Revised......................................................11276
83.25  (e) and (f) revised.........................................11276
205.54  (d)(1)(iii)(C)(1) and (j)(1)(ii) revised....................3598
205.90--205-97 (Subpart F)  Revised................................12682

                                  1989

44 CFR
                                                                   54 FR
                                                                    Page
Chapter I
5  Authority citation revised......................................11715
5.80--5.89 (Subpart F)  Revised....................................11715
17  Heading and authority citation revised..........................4963
    Technical correction............................................6363
17.305  (c) (3) and (4) amended; (c)(5) added; interim..............4963
17.320  Revised; interim............................................4963
17.600--17.630 (Subpart F)  Added; interim..........................4963
17  Appendix C added; interim.......................................4963
25  Regulations at 52 FR 48026 confirmed; see regulations codified 
        at 49 CFR 24................................................8912
59.1  Amended; eff. 10-1-89........................................33549
    Amendment at 52 FR 24372 effectiveness extended to 10-31-89....40005
60.3  (c)(5), (e)(4), and (e)(5)(ii) amended.......................33550
    (c)(6) suspension and (c)(12) addition at 52 FR 24372 
effectiveness extended to 10-31-89.................................40005
    60.3  (c)(6)(iv) corrected.....................................42144
60.6  (a) amended..................................................33550
64.6  Table amended................................................1362,
 4783, 5463, 6522, 8330-8331, 11527, 13066, 18105, 18107, 20126, 22441, 
   23982, 25118, 26743-26744, 27359, 27361, 30384, 30546, 30548, 32813, 
    32814, 33221, 33223, 36768, 36770, 38854, 38857, 4087343426, 46069, 
                                              46246, 48891, 50236, 51883
    Table corrected.........................................22440, 38233
65.4  Table amended................................................5239,
                           8332, 22898, 26746-26748, 31187, 46249, 52941
    Table amended; interim.........................................5240,

[[Page 665]]

8541, 12451, 15409, 31186, 33897, 38858, 38859, 43179,47359-47360, 52940
65.6  (a)(6) revised...............................................33550
65.13  Redesignated as 65.14; new 65.13 added......................33551
65.14  Redesignated from 65.13.....................................33551
67  Flood elevation determinations.................................5241,
    6920, 8333, 12451, 14803, 15409, 21954, 25260, 26748, 31187, 33693, 
                                33897, 38860, 42501, 43292, 47360, 52942
72.3  (a) (1) and (2) and (b) (1) through (4) revised; (b)(5) 
        added......................................................11950
72.4  (c) and (e) amended..........................................11950
80.1  (a)(24) amended..............................................31681
80.5  (b)(7) revised...............................................31681
83.5  (a) amended..................................................31681
83.25  (e) revised.................................................31682
83.26  (b) amended.................................................31684
206  Added; interim................................................11615
206.1--206.19 (Subpart A)  Added; interim..........................22164
206.31--206.46 (Subpart B)  Added; interim.........................22168
206.61--206.67 (Subpart C)  Added; interim.........................22172
206.430--206.440 (Subpart N)  Added; interim.......................22177
207  Heading added; interim........................................11654
    Added; interim.................................................16109
220  Added..........................................................3034
221  Added.........................................................11951
300.1  Removed; new 300.1 redesignated from 300.2 and revised.......2128
300.2  Redesignated as 300.1 and revised; new 300.2 redesignated 
        from 300.4..................................................2128
    Revised.........................................................2129
300.3  Removed; new 300.3 redesignated from 300.5...................2128
    Revised.........................................................2129
300.4  Redesignated as 300.2........................................2128
300.5  Redesignated as 300.3........................................2128
300.6  Removed.....................................................26751
352  Added; interim.................................................8514
    Technical correction...........................................10616
    Regulation at 54 FR 8514 confirmed and revised.................31925

                                  1990

44 CFR
                                                                   55 FR
                                                                    Page
Chapter I
2.81  Table revised(OMB numbers)...................................39412
7.1--7.16  Designated as Subpart A.................................23078
7.910--7.949 (Subpart E)  Added....................................23078
17.305  Regulation at 54 FR 4950, 4963 confirmed...................21701
17.320  Regulation at 54 FR 4950, 4963 confirmed...................21701
17.600--17.635 (Subpart F)  Revised................................21702
17  Appendix C revised.............................................21702
18  Added; interim............................................6737, 6754
62  Appendix A amended.............................................32628
64.6  Table amended.................................................155,
  2835, 2837, 3955, 3957, 6985, 6987, 9882, 11913, 11914, 13534, 15229, 
  18114, 18337, 18885, 18886, 21032, 21033, 24087, 25309, 26444, 26446, 
  28205, 30711, 30714, 30716, 32629, 33310, 35143, 36279, 38803, 38805, 
           41080, 42717, 46209, 48234, 48236, 48238, 51417, 51419, 53132
65.4  Table amended.......2839, 6988, 11917, 18116, 24088, 31837, 35633, 
                                              41083, 41084, 46210, 51421
    Table amended; interim.......2840, 8950, 11915, 18117, 24090, 31836, 
                                                            35634, 51420
67    Flood elevation determinations........863, 1217, 1226, 2840, 5449, 
          6988, 11917, 13785, 18117, 24091, 24569, 31838, 34556, 35635, 
                                              42007, 46211, 48612, 51422
    Technical correction...........................................42303
72.3  (a)(1), (2) and (b)(1) through (5) revised; (b)(6) added.....39413
72.4  (c) introductory text, (2) and (3) revised; (c)(4) and (5) 
        added......................................................39414
73  Waivers........................................................53152
82.1  (b), (c), (i), and (j) revised...............................42189
    (n) added......................................................42190
82.2  (d) and (e) added............................................42190
82.5  (b) revised..................................................42190
82.31  (f) revised.................................................42190
83.24  (d) revised.................................................42191
83.25  (e) revised.................................................42191
    (f) revised....................................................42193
206  Authority citation revised..............................2288, 35529
206.1--206.18 (Subpart A)  Revised..................................2288

[[Page 666]]

206.4  Corrected....................................................5458
206.13  (a) corrected...............................................5458
206.31--206.46 (Subpart B)  Revised.................................2292
206.38  (b) corrected...............................................5458
206.61--206.67 (Subpart C)  Revised.................................2296
206.131  (d)(1)(iii)(E) removed; interim...........................28627
206.200--206.208 (Subpart G)  Revised...............................2304
206.204  (c) table correctly revised................................5458
206.207  (b)(2) corrected...........................................5458
206.220--206.228 (Subpart H)  Revised...............................2307
206.340--206.349 (Subpart J)  Revised...............................2311
206.360--206.367 (Subpart K)  Revised...............................2314
206.390--206.395 (Subpart L)  Revised...............................2318
206.400--206.407 (Subpart M)  Revised..............................35529
206.430--206.440 (Subpart N)  Revised..............................35537
206.437  (c) redesignated as (d); (c) correctly designated.........52172
207  Authority citation corrected..................................10030
    Regulation at 54 FR 16109 confirmed; revised....................7329
334  Added..........................................................1821
336  Added.........................................................30458
336.4  (g) revised.................................................34262
336.5  (e) revised.................................................34262
336.7  (b)(4) revised..............................................34262

                                  1991

44 CFR
                                                                   56 FR
                                                                    Page
Chapter I
8.2  (b)(4) removed................................................32328
15.1--15.15  Designated as Subpart A...............................19597
15.31--15.46 (Subpart B)  Added....................................19597
62.23  (a), (h)(4), (i)(1) and (j)(5) amended; (l) added...........43882
62  Appendixes A and B amended.....................................43882
64.6  Table amended......1119, 1120, 2854, 2855, 2858, 5952, 8136, 8138, 
          8140, 10516, 10517, 11680, 15506, 19295, 19297, 23659, 23661, 
         26337, 28091, 31337, 31340, 34024, 41292, 41295, 46991, 47619, 
                                 51336, 55467-55469, 58314, 60066, 65005
65.4  Table amended; interim.....2859, 7303, 14651, 22656, 34026, 46994, 
                                                                   51336
    Table amended.........2860, 7307, 14649, 22654, 28092, 28094, 32329, 
                                       32330, 34027, 41297, 41298, 46993
67  Flood elevation determinations.......2861, 6279, 8142, 15507, 21603, 
           22657, 28094, 28329, 32331, 34028, 38485, 41299, 41300, 41303
    Flood elevation determinations.................................46995
    Flood elevation determinations..........................51339, 67001
206.250--206.253 (Subpart I)  Revised..............................64560
302.5  (b)(5) removed; (b)(3) and (4) revised......................29905
326  Removed.......................................................22659
353  Added..........................................................9455
361  Revised.......................................................32491

                                  1992

44 CFR
                                                                   57 FR
                                                                    Page
Chapter I
11  Authority citation revised.....................................54714
11.30  Revised.....................................................54714
11.32  Nomenclature change.........................................54714
11.34  Heading, (a) introductory text, (a)(1) introductory text 
        and (c) revised............................................54714
11.41  (c) added...................................................54715
11.42  (a) amended.................................................54715
11.43  (a) amended; (f) added......................................54715
11.44  (a) introductory text amended...............................54715
11.45  (a) and (d) amended; (g) added..............................54715
11.48  (a) and (d) amended; (g) revised............................54715
11.50  (c) amended.................................................54715
11.51  Heading revised; (c) amended................................54715
11.52  (c) amended.................................................54715
11.60  Nomenclature change.........................................54715
11.61  Added.......................................................54715
11.62  Added.......................................................54716
11.63  Added.......................................................54716
11.64  Added.......................................................54716

[[Page 667]]

11.65  Added.......................................................54717
59  Authority citation revised.....................................19540
59.1  Amended......................................................19540
59.4  (c) amended..................................................19540
59.24  (b) introductory text and (3) amended.......................19540
61  Authority citation revised.....................................19540
61.5  (d) redesignated in part as (d)(1) and (3); (d) (1) revised; 
        new (d)(2) added...........................................19541
61.15  Removed.....................................................19541
61.16  Amended.....................................................19541
61  Appendixes A(1) and (2) amended................................19541
62  Authority citation revised.....................................19541
62.6  (a)(1) and (2) revised.......................................19541
64  Authority citation revised.....................................11688
64.6  Table amended.....357, 359, 2683, 3556, 9504, 10832, 11688, 18831, 
         18833, 18834, 22438, 23159, 27001, 27003, 34686, 34688, 37715, 
         39618, 41105, 41876, 43619, 47267, 47269, 49143, 49144, 54512, 
                                                     54514, 54934, 60487
65  Authority citation revised..............................19380, 29038
65.4  Table amended........360, 9057, 19380, 27359, 32900, 37717, 41877, 
                         41879, 47788, 47789, 54306, 54307, 59304, 59305
    Table amended; interim.........362, 9056, 19382, 27357, 32901, 37716
    (c) added......................................................29038
67  Flood elevation determinations........526, 9059, 9212, 19542, 27361, 
                         32735, 37719, 39619, 41880, 47791, 54309, 59306
    Authority citation revised.....................................19542
71  Heading and authority citation revised.........................22661
71.1  Amended......................................................22661
71.2  (b) introductory text through (d) revised; (e) through (k) 
        added......................................................22661
71.3  Revised......................................................22662
71.4  (a), (b), (c) introductory text and (d) introductory text 
        revised; (e) through (h) added.............................22662
72  Revised........................................................29038
75  Authority citation revised.....................................19542
75.14  Amended.....................................................19542
80.310  Revised....................................................19552
81  Authority citation revised.....................................11267
81.1  (b)(1) revised........................................11267, 52593
83.25  (e) revised.................................................26776
353  User fees.....................................................10834
361  Revised.......................................................34869

                                  1993

44 CFR
                                                                   58 FR
                                                                    Page
Chapter I
2  Authority citation revised......................................45061
2.23  Revised......................................................45061
2.68  Revised......................................................45061
3  Removed.........................................................47218
59  Authority citation revised.....................................62424
59.1  Amended......................................................62424
61  Authority citation revised.....................................62424
61.3  Amended......................................................62424
61.4  (a) designation and (b) through (e) removed; (1) through (4) 
        redesignated as (a) through (d)............................62424
61.5  (d)(1), (2), (e) through (h) and (j) removed; (d)(3) and (i) 
        redesignated as (d) and (e); (a) and new (d) amended.......62424
61.6  (c) added....................................................62424
61.13  (a) and (d) amended.........................................62424
61  appendix A (1) revised.........................................62424
    appendix A (2) revised.........................................62432
    appendix A (3) added...........................................62439
62  Authority citation revised.....................................62447
62.3  (b) revised; (d) removed.....................................62447
64.6  Table amended....502, 4083, 4085, 6097, 9121, 11195, 11969, 14160, 
         16501, 19613, 19615, 25568, 29978, 29980, 30993, 33556, 33557, 
                                33559, 39667, 39669, 39671, 43802, 45063
    Table amended........51577, 52019, 58654, 58656, 58970, 63900, 67693
65.4  Table amended.......8550, 8553, 11541, 11543, 14324, 19617, 19619, 
                                       30124, 38304, 43805, 51016, 51017
    Table amended; interim......8552, 15092, 19617, 29122; 32858, 32860, 
                                                            38306, 43804
    Table amended...........................................68040, 68044
    Table amended; interim..................................68042, 68045
67  Flood elevation determinations.....8550, 11544, 14326, 19621, 29123, 
                                       30126, 32861, 38084, 43807, 51018
    Flood elevation determinations..........................68047, 68050
81.1  (b)(1) revised; interim......................................34920
206  Authority citation revised....................................47996
206.202  (d) revised; eff. 10-14-93................................47996

[[Page 668]]

206.221  (e)(6) revised; eff. 10-14-93.............................47994
206.226  (a) revised...............................................55022
206.228  (a)(4) added; eff. 10-14-93...............................47996
353  Authority citation revised....................................47997
    Appendix A revised.............................................47997
354  Added; interim................................................35771

                                  1994

44 CFR
                                                                   59 FR
                                                                    Page
Chapter I
2  Revised.........................................................26133
2.81  OMB numbers..................................................26140
10  Authority citation revised.......................................954
10.8  (c)(2)(x) added; interim.......................................954
59  Authority citation revised.....................................53597
    Comment period extension.......................................63726
59.1  Amended; interim.............................................53597
59.24  Table amended................................................2755
    (a) revised; interim...........................................53598
60  Authority citation revised.....................................53598
    Comment period extension.......................................63726
60.2  (a) revised; interim.........................................53598
60.3  (f) added; interim...........................................53598
61.9  Revised......................................................26741
62.24  Added; interim..............................................38572
62  Appendix A revised; interim....................................26966
    Appendix A amended; interim....................................38573
64  Authority citation revised.....................................53599
    Comment period extension.......................................63726
64.3  (a)(1) table amended; (b) revised; interim...................53599
64.6  Table amended........4005, 5727, 9672, 11727, 24650, 24653, 30706, 
         36370, 38922, 44333, 44335, 49354, 53111, 54133, 59944, 62329, 
                                                            66486, 67640
65  Authority citation revised.....................................53599
    Comment period extension.......................................63726
65.4  Table amended; interim.....5728, 5729, 12186, 12187, 17715, 17716, 
         28486, 32128, 33441, 39973, 40829, 49582, 52439, 56004, 60720, 
                                                                   64157
    Table amended........5730, 12184, 17713, 17718, 28485, 32129, 33440, 
                                       43054, 44337, 44338, 52437, 64158
65.14  Redesignated as 65.15; new 65.14 added; interim.............53599
65.15  Redesignated from 65.14; interim............................53599
67  Flood elevation determinations......5732, 5733, 12188, 12190, 17719, 
         17720, 17722, 32130, 33443, 40831, 43055, 52440, 55060, 55591, 
                                                            60721, 64159
70  Authority citation revised.....................................53600
    Comment period extension.......................................63726
70.1  Revised; interim.............................................53600
70.3  (a) revised; interim.........................................53601
70.4  Heading, (a) and (b) revised; interim........................53601
70.5  (c) revised; interim.........................................53601
75  Authority citation revised.....................................53601
    Comment period extension.......................................63726
75.1  Revised; interim.............................................53601
75.10  Revised; interim............................................53601
75.11  (a)(4), (5) and (7) revised; interim........................53601
75.13  Heading and (c) revised.....................................53601
205  Removed.......................................................53363
206.1  Revised.....................................................53363
206.430  Revised; interim..........................................24356
206.431  (c) revised; interim......................................24356
206.432  (b) and (c) revised; interim..............................24356
206.434  (c)(4) revised; (d) and (e) redesignated as (f) and (g); 
        new (d) and new (e) added; interim.........................24356
311  Correctly removed; CFR correction.............................24947
322  Removed.......................................................36088
362  Added.........................................................35631
Chapter IV
403.1  Revised......................................................8413
403.2  Revised......................................................8413

                                  1995

44 CFR
                                                                   60 FR
                                                                    Page
Chapter I
13  Authority citation revised.....................................19645
13.36  (d), (g), (h) and (i) revised........................19639, 19645
17  Authority citation revised.....................................33061
17.100  Revised.............................................33040, 33061
17.105  Amended.............................................33041, 33061
17.110  (c) revised.........................................33041, 33061
17.200  Revised.............................................33041, 33061
17.215  Revised.............................................33041, 33061
17.220  Revised.............................................33041, 33061
17.225  Revised.............................................33041, 33061
17  Appendixes A and B revised..............................33042, 33061
61.6  Revised.......................................................5585

[[Page 669]]

61.11  (a), (b) and (c) revised.....................................5585
    (f)(1) and (2) removed; (f)(3) redesignated as (g); (e) and 
new (g) amended.....................................................5586
64.6  Table amended.......6035, 6036, 10037, 10511, 15071, 17006, 20650, 
         21740, 27227, 28733, 32612, 33755, 38272, 39124, 42463, 46031, 
                                46038, 50453, 51362, 54613, 55330, 65583
65  Authority citation revised..............................35281, 62218
65.4  Table amended; interim......4100, 5587, 6404, 17010, 17012, 26366, 
         26367, 29996, 34890, 38275, 39868, 44768, 46039, 46041, 54037, 
                                              55468, 56250, 56252, 62336
    Table amended...4102, 5588, 6405, 13049, 17007, 17013, 26364, 26365, 
         29994, 34889, 39865, 44765, 46042, 46043, 54039, 55470, 56253, 
                                                            62333, 62336
65.16  Added.......................................................35281
65.17  Added.......................................................62218
65  Appendix A added...............................................35281
67  Flood elevation determinations.......4106, 5590, 6407, 13051, 17013, 
         17020, 26369, 29998, 34892, 39869, 44770, 46045, 54040, 55472, 
                                                            56254, 62337
152  Added.........................................................11236
206.131  (d)(1)(iii)(C)(1) and (D) revised; interim.................7130
354  Revised.......................................................15632

                                  1996

44 CFR
                                                                   61 FR
                                                                    Page
Chapter I
10  Authority citation revised......................................4230
10.8  (c), (d) and (e) revised......................................4230
    (c)(1) correctly revised.......................................10688
61.9  Revised.......................................................8223
61.17  Added; interim..............................................19200
62.23  Revised; eff. 10-31-96......................................51219
62  Appendix A amended; interim....................................24463
    Appendix A corrected...........................................36513
    Appendix A revised.............................................37689
    Appendix B revised; eff. 10-31-96..............................51221
64.6  Table amended........5948, 7998, 8475, 14498, 15724, 18288, 19858, 
         25803, 28068, 32704, 36515, 40526, 42180, 44164, 46733, 51227, 
                                              51229, 54564, 57573, 59339
65.4  Table amended........6560, 6561, 6567, 10469, 11316, 14662, 16875, 
           25404, 29490, 33853, 38092, 43678, 44166, 54568, 60035, 66924
    Table amended; interim........6562, 6565, 6566, 10473, 11318, 14659, 
         17251, 25400, 25403, 29488, 33855, 38093, 40528, 43680, 44168, 
                                                     54566, 60038, 66926
    (c) revised; interim...........................................46331
65.5  (d) revised; interim.........................................46331
65.6  (g) revised; interim.........................................46331
65.8  Revised; interim.............................................46331
65.9  (h) added; interim...........................................46331
67.11  Flood elevation determinations....6568, 6570, 6572, 10475, 11319, 
         14666, 16876, 25406, 29490, 33857, 38095, 43683, 44170, 54574, 
                                                            60041, 66927
70  Authority citation revised.....................................46331
70.9  Revised; interim.............................................46331
72  Authority citation revised.....................................46332
72.1  Revised; interim.............................................46332
72.2  Revised; interim.............................................46332
72.3  Revised; interim.............................................46332
72.4  Revised; interim.............................................42332
72.5  (a) and (b) revised; interim.................................46333
72.6  Revised; interim.............................................46333
72.7  Revised; interim.............................................46333
206  Authority citation revised..............................7224, 19201
206.101  (g) introductory text added................................7224
206.131  (a) amended; (d)(1)(iii)(C) and (D) revised...............19201

                                  1997

  (Regulations published from January 1, 1997, through October 1, 1997)

44 CFR
                                                                   62 FR
                                                                    Page
Chapter I
13.26  (a), (b) introductory text and (1) revised...........45939, 45945
61  Appendix A(1) amended...........................................8397
    Appendix A(2) amended...........................................8398
    Appendix A(3) amended...........................................8399
62  Appendix A revised.............................................39910
64.6  Table amended....1686, 1689, 4916, 5535, 8177, 9373, 13343, 16085, 
         19506, 24344, 27504, 31521, 33570, 39449, 40946, 43292, 49446, 
                                                                   49448
65.4  Table amended; interim......3224, 6879, 9686, 16088, 17560, 23146, 
                                30283, 33027, 37727, 39124, 45573, 47955
    Table amended...3227, 6881, 9688, 17562, 23145, 30280, 33024, 39126, 
                                                                   45575
    (c) revised.....................................................5736

[[Page 670]]

65.5  Heading and (d) revised.......................................5736
65.6  (g) revised...................................................5736
65.8  Revised.......................................................5736
65.9  Heading and (h) revised.......................................5736
67.11  Flood elevation determinations....3229, 6884, 9690, 16090, 17563, 
                         23147, 25859, 30285, 37729, 39127, 45576, 47955
70  Authority citation revised......................................5736
70.9  Revised.......................................................5736
72  Authority citation revised......................................5736
72.1  Revised.......................................................5736
72.2  Revised.......................................................5737
72.3  Revised.......................................................5737
72.4  Revised.......................................................5737
72.5  Revised.......................................................5738
72.6  Revised.......................................................5738
72.7  Revised.......................................................5738
78  Added; interim.................................................13347
206  Authority citation revised....................................45330
206.227  Revised...................................................45330