[Congressional Record Volume 149, Number 168 (Wednesday, November 19, 2003)]
[House]
[Pages H11595-H11598]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 MAKING IN ORDER AT ANY TIME CONSIDERATION OF H.R. 253, TWO FLOODS AND 
            YOU ARE OUT OF THE TAXPAYERS' POCKET ACT OF 2003

  Mr. FOLEY (during debate on motion to instruct on H.R. 1). Mr. 
Speaker, I ask unanimous consent that it shall be in order at any time 
without intervention of any point of order to consider in the House the 
bill H.R. 253; the bill shall be considered as read for amendment; in 
lieu of the amendment recommended by the Committee on Financial 
Services now printed in the bill, an amendment in the nature of a 
substitute and numbered one printed in the Congressional Record of 
November 19, 2003, shall be considered as adopted; the previous 
question shall be

[[Page H11596]]

considered as ordered on the bill, as amended, and on any further 
amendment thereto to final passage without intervening motion except:
  (1) one hour of debate on the bill, as amended, equally divided and 
controlled by the chairman and ranking minority member of the Committee 
on Financial Services;
  (2) a further amendment in the nature of a substitute now at the 
desk, if offered by the gentleman from Louisiana (Mr. Baker) or his 
designee, which shall be in order without intervention of any point of 
order, shall be considered as read, and shall be separately debatable 
for 30 minutes equally divided and controlled by the proponent and an 
opponent; and
  (3) one motion to recommit with or without instructions.
  Further, that the amendment placed at the desk be considered as read 
for purposes of this unanimous consent request.
  The text of the amendment in the nature of a substitute is as 
follows:

   Amendment in the Nature of a Substitute to H.R. 253, as Reported, 
                   Offered by Mr. Baker of Louisiana

       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Flood Mitigation Reform Act 
     of 2003''.

     SEC. 2. EXTENSION OF PROGRAM AND CONSOLIDATION OF 
                   AUTHORIZATIONS.

       The National Flood Insurance Act of 1968 is amended as 
     follows:
       (1) Borrowing authority.--In the first sentence of section 
     1309(a) (42 U.S.C. 4016(a)), by striking ``through December'' 
     and all that follows through ``, and'' and inserting the 
     following: ``through the date specified in section 1319, 
     and''.
       (2) Authority for contracts.--In section 1319 (42 U.S.C. 
     4026), by striking ``after'' and all that follows and 
     inserting ``after September 30, 2008.''.
       (3) Emergency implementation.--In section 1336(a) (42 
     U.S.C. 4056(a)), by striking ``during the period'' and all 
     that follows through ``in accordance'' and inserting ``during 
     the period ending on the date specified in section 1319, in 
     accordance''.
       (4) Authorization of appropriations for studies.--In 
     section 1376(c) (42 U.S.C. 4127(c)), by striking ``through'' 
     and all that follows and inserting the following: ``through 
     the date specified in section 1319, for studies under this 
     title.''.

     SEC. 3. ESTABLISHMENT OF PILOT PROGRAM FOR MITIGATION OF 
                   SEVERE REPETITIVE LOSS PROPERTIES.

       (a) In General.--The National Flood Insurance Act of 1968 
     is amended by inserting after section 1361 (42 U.S.C. 4102) 
     the following new section:


  ``pilot program for mitigation of severe repetitive loss properties

       ``Sec. 1362. (a) Authority.--To the extent amounts are made 
     available for use under this section, the Director may, 
     subject to the limitations of this section, provide financial 
     assistance to States and communities for taking actions with 
     respect to severe repetitive loss properties (as such term is 
     defined in subsection (b)) to mitigate flood damage to such 
     properties and losses to the National Flood Insurance Fund 
     from such properties.
       ``(b) Severe Repetitive Loss Property.--For purposes of 
     this section, the term `severe repetitive loss property' has 
     the following meaning:
       ``(1) Single-family properties.--In the case of a property 
     consisting of one to four residences, such term means a 
     property that--
       ``(A) is covered under a contract for flood insurance made 
     available under this title; and
       ``(B) has incurred flood-related damage--
       ``(i) for which four or more separate claims payments have 
     been made under flood insurance coverage under this title 
     before the date of the enactment of the Flood Mitigation 
     Reform Act of 2003, with the amount of each such claim 
     exceeding $5,000, and with the cumulative amount of such 
     claims payments exceeding $20,000;
       ``(ii) for which four or more separate claims payments have 
     been made under flood insurance coverage under this title 
     after the date of the enactment of the Flood Mitigation 
     Reform Act of 2003, with the amount of each such claim 
     exceeding $3,000, and with the cumulative amount of such 
     claims payments exceeding $15,000; or
       ``(iii) for which at least two separate claims payments 
     have been made under such coverage, with the cumulative 
     amount of such claims exceeding the value of the property.
       ``(2) Multifamily properties.--In the case of a property 
     consisting of five or more residences, such term shall have 
     such meaning as the Director shall by regulation provide.
       ``(c) Eligible Activities.--Amounts provided under this 
     section to a State or community may be used only for the 
     following activities:
       ``(1) Mitigation activities.--To carry out mitigation 
     activities that reduce flood damages to severe repetitive 
     loss properties, including elevation, relocation, demolition 
     (with or without reconstruction of the structure in a 
     floodproof manner), and floodproofing of structures, and 
     minor physical localized flood control projects.
       ``(2) Purchase.--To purchase severe repetitive loss 
     properties, subject to subsection (f).
       ``(d) Matching Requirement.--
       ``(1) In general.--Except as provided in paragraph (2), the 
     Director may not provide assistance under this section to a 
     State or community in an amount exceeding 3 times the amount 
     that the State or community certifies, as the Director shall 
     require, that the State or community will contribute from 
     non-Federal funds for carrying out the eligible activities to 
     be funded with such assistance amounts.
       ``(2) Waiver.--
       ``(A) Authority.--Subject to subparagraph (B), the Director 
     may waive the limitation under paragraph (1) for any State, 
     and for the communities located in that State, with respect 
     to a year, if, for such year--
       ``(i) 5 percent or more of the total number of severe 
     repetitive loss properties in the United States are located 
     in such State; and
       ``(ii) the State submits a plan to the Director specifying 
     how the State intends to reduce the number of severe 
     repetitive loss properties and the Director determines, after 
     consultation with State and technical experts, that the State 
     has taken actions to reduce the number of such properties.
       ``(B) Limitation.--In each waiver under subparagraph (A), 
     the Director may waive the limitation under paragraph (1) 
     only to the extent that the State or community involved is 
     required to contribute, for each severe repetitive loss 
     property for which grant amounts are provided, not less than 
     10 percent of the cost of the activities for such properties 
     that are to be funded with grant amounts.
       ``(3) Non-federal funds.--For purposes of this subsection, 
     the term `non-Federal funds' includes State or local agency 
     funds, in-kind contributions, any salary paid to staff to 
     carry out the eligible activities of the recipient, the value 
     of the time and services contributed by volunteers to carry 
     out such activities (at a rate determined by the Director), 
     and the value of any donated material or building and the 
     value of any lease on a building.
       ``(e) Standards for Mitigation Offers.--The program under 
     this section for providing assistance for eligible activities 
     for severe repetitive loss properties shall be subject to the 
     following limitations:
       ``(1) Priority.--In determining the properties for which to 
     provide assistance for eligible activities under subsection 
     (c), the Director shall provide assistance for properties in 
     the order that will result in the greatest amount of savings 
     to the National Flood Insurance Fund in the shortest period 
     of time.
       ``(2) Offers.--The Director shall provide assistance in a 
     manner that permits States and communities to make offers to 
     owners of severe repetitive loss properties to take eligible 
     activities under subsection (c) as soon as is practicable.
       ``(3) Funding requirement.--An offer to provide assistance 
     for any eligible activity under subsection (c) with respect 
     to a property may not be made unless adequate amounts are 
     available in the National Flood Insurance Fund pursuant to 
     subsection (h) for the full amount of the portion of such 
     assistance for such property to be provided by the Director.
       ``(4) Notice.--Upon making an offer to provide assistance 
     with respect to a property for any eligible activity under 
     subsection (c), the State or community shall notify each 
     holder of a recorded interest on the property of such offer 
     and activity.
       ``(f) Purchase Price.--A State or community may take action 
     under subsection (c)(2) to purchase a severe repetitive loss 
     property only if the amount of purchase offer is not less 
     than the greatest of--
       ``(1) the amount of the original purchase price of the 
     property, when purchased by the holder of the current policy 
     of flood insurance under this title;
       ``(2) the total amount owed, at the time the offer to 
     purchase is made, under any loan secured by a recorded 
     interest on the property; and
       ``(3) an amount equal to the fair market value of the 
     property immediately before the most recent flood event 
     affecting the property.
       ``(g) Increased Premiums in Cases of Refusal To Mitigate.--
       ``(1) In general.--In any case in which the owner of a 
     severe repetitive loss property refuses an offer to take 
     action under paragraph (1) or (2) of subsection (c) with 
     respect to such property, the Director shall--
       ``(A) notify each holder of a recorded interest on the 
     property of such refusal; and
       ``(B) notwithstanding subsections (a) through (c) of 
     section 1308, thereafter the chargeable premium rate with 
     respect to the property shall be the amount equal to 150 
     percent of the chargeable rate for the property at the time 
     that the offer was made, as adjusted by any other premium 
     adjustments otherwise applicable to the property and any 
     subsequent increases pursuant to paragraph (2) and subject to 
     the limitation under paragraph (3).
       ``(2) Increased premiums upon subsequent flood damage.--
     Notwithstanding subsections (a) through (c) of section 1308, 
     if the owner of a severe repetitive loss property does not 
     accept an offer to take action under paragraph (1) or (2) of 
     subsection (c) with respect to such property and a claim 
     payment exceeding $1,500 is made under flood insurance 
     coverage under this title for damage to

[[Page H11597]]

     the property caused by a flood event occurring after such 
     offer is made, thereafter the chargeable premium rate with 
     respect to the property shall be the amount equal to 150 
     percent of the chargeable rate for the property at the time 
     of such flood event, as adjusted by any other premium 
     adjustments otherwise applicable to the property and any 
     subsequent increases pursuant to this paragraph and subject 
     to the limitation under paragraph (3).
       ``(3) Limitation on increased premiums.--In no case may the 
     chargeable premium rate for a severe repetitive loss property 
     be increased pursuant to this subsection to an amount 
     exceeding the applicable estimated risk premium rate for the 
     area (or subdivision thereof) under section 1307(a)(1).
       ``(4) Treatment of deductibles.--Any increase in chargeable 
     premium rates required under this subsection for a severe 
     repetitive loss property may be carried out, to the extent 
     appropriate, as determined by the Director, by adjusting any 
     deductible charged in connection with flood insurance 
     coverage under this title for the property.
       ``(5) Notice of continued offer.--Upon each renewal or 
     modification of any flood insurance coverage under this title 
     for a severe repetitive loss property, the Director shall 
     notify the owner that the offer made pursuant to subsection 
     (c) is still open.
       ``(6) Appeals.--
       ``(A) In general.--Any owner of a severe repetitive loss 
     property may appeal a determination of the Director to take 
     action under paragraph (1)(B) or (2) with respect to such 
     property, based only upon the following grounds:
       ``(i) As a result of such action, the owner of the property 
     will not be able to purchase a replacement primary residence 
     of comparable value and that is functionally equivalent.
       ``(ii) As a result of such action, the preservation or 
     maintenance of any prehistoric or historic district, site, 
     building, structure, or object included in, or eligible for 
     inclusion in, the National Register of historic places will 
     be interfered with, impaired, or disrupted.
       ``(iii) The flooding that resulted in the flood insurance 
     claims sufficient for the property to be classified as a 
     severe repetitive loss property resulted from significant 
     actions by a third party in violation of Federal, State, or 
     local law, ordinance, or regulation.
       ``(iv) In purchasing the property, the owner relied upon 
     flood insurance rate maps of the Federal Emergency Management 
     Agency that were current at the time and did not indicate 
     that the property was located in an area having special flood 
     hazards.
       ``(B) Procedure.--An appeal under this paragraph of a 
     determination of the Director shall be made by filing, with 
     the Director, a request for an appeal within 90 days after 
     receiving notice of such determination. Upon receiving the 
     request, the Director shall select, from a list of 
     independent third parties compiled by the Director for such 
     purpose, a party to hear such appeal. Within 90 days after 
     filing of the request for the appeal, such third party shall 
     review the determination of the Director and shall set aside 
     such determination if the third party determines that the 
     grounds under subparagraph (A) exist. During the pendency of 
     an appeal under this paragraph, the Director shall stay the 
     applicability of the rates established pursuant to paragraph 
     (1)(B) or (2), as applicable.
       ``(C) Effect of final determination.--In an appeal under 
     this paragraph--
       ``(i) if a final determination is made that the grounds 
     under subparagraph (A) exist, the third party hearing such 
     appeal shall make a determination of how much to reduce the 
     chargeable risk premium rate for flood insurance coverage for 
     the property involved in the appeal from the amount required 
     under paragraph (1)(B) or (2) and the Director shall promptly 
     reduce the chargeable risk premium rate for such property by 
     such amount; and
       ``(ii) if a final determination is made that the grounds 
     under subparagraph (A) do not exist, the Director shall 
     promptly increase the chargeable risk premium rate for such 
     property to the amount established pursuant to paragraph 
     (1)(B) or (2), as applicable, and shall collect from the 
     property owner the amount necessary to cover the stay of the 
     applicability of such increased rates during the pendency of 
     the appeal.
       ``(D) Costs.--If the third party hearing an appeal under 
     this paragraph is compensated for such service, the costs of 
     such compensation shall be borne--
       ``(i) by the owner of the property requesting the appeal, 
     if the final determination in the appeal is that the grounds 
     under subparagraph (A) do not exist; and
       ``(ii) by the National Flood Insurance Fund, if such final 
     determination is that the grounds under subparagraph (A) do 
     exist.
       ``(E) Report.--Not later than 6 months after the date of 
     the enactment of the Flood Mitigation Reform Act of 2003, the 
     Director shall submit a report to the House of 
     Representatives and the Senate describing the rules, 
     procedures, and administration for appeals under this 
     paragraph.
       ``(h) Discretionary Actions in Cases of Fraudulent 
     Claims.--If the Director determines that a fraudulent claim 
     was made under flood insurance coverage under this title for 
     a severe repetitive loss property, the Director may--
       ``(1) cancel the policy and deny the provision to such 
     policyholder of any new flood insurance coverage under this 
     title for the property; or
       ``(2) refuse to renew the policy with such policyholder 
     upon expiration and deny the provision of any new flood 
     insurance coverage under this title to such policyholder for 
     the property.
       ``(i) Funding.--Pursuant to section 1310(a)(8), the 
     Director may use amounts from the National Flood Insurance 
     Fund to provide assistance under this section each of fiscal 
     years 2004, 2005, and 2006. The amount so used in each such 
     fiscal year may not exceed $40,000,000 and shall remain 
     available for such purpose until expended or the expiration 
     of the 3-year period under subsection (j), whichever occurs 
     first. After the expiration of such 3-year period, the 
     Director may use amounts from such Fund to provide assistance 
     in connection with any outstanding offers for eligible 
     activities under this section. Notwithstanding any other 
     provision of this title, amounts made available pursuant to 
     this subsection shall not be subject to offsetting 
     collections through premium rates for flood insurance 
     coverage under this title.
       ``(j) Termination.--The Director may not provide assistance 
     under this section to any State or community for carrying out 
     eligible activities under this section pursuant to an offer 
     for such activities made after the expiration of the 3-year 
     period beginning on the date of the enactment of the Flood 
     Mitigation Reform Act of 2003.
       ``(k) Regulations.--The Director shall issue regulations to 
     carry out this section, which shall take effect not later 
     than the expiration of the 180-day period beginning on the 
     date of the enactment of the Flood Mitigation Reform Act of 
     2003. The regulations shall be issued after notice and 
     opportunity for public comment in accordance with the 
     procedure under section 553 of title 5, United States Code, 
     applicable to substantive rules (notwithstanding subsections 
     (a)(2), (b)(B), and (d)(3) of such section).''.
       (b) Availability of National Flood Insurance Fund 
     Amounts.--Section 1310(a) of the National Flood Insurance Act 
     of 1968 (42 U.S.C. 4017(a)) is amended--
       (1) in paragraph (7), by striking ``and'' at the end; and
       (2) by striking paragraph (8) and inserting the following 
     new paragraph:
       ``(8) for financial assistance under section 1362 to States 
     and communities for taking actions under such section with 
     respect to severe repetitive loss properties, but only to the 
     extent provided in section 1362(i); and''.
       (c) Inapplicability of Annual Limitations on Premium 
     Increases in Cases of Refusal To Mitigate.--Section 1308(e) 
     of the National Flood Insurance Act of 1968 (42 U.S.C. 
     4015(e)) is amended by striking ``Notwithstanding'' and 
     inserting ``Except with respect to any increase pursuant to 
     section 1362(g) and notwithstanding''.
       (d) GAO Study.--
       (1) In general.--The Comptroller General of the United 
     States shall carry out a study of the pilot program for 
     mitigation of severe repetitive loss properties established 
     under the amendments made by this section. Such study shall 
     determine--
       (A) the number of properties for which mitigation 
     activities have been conducted under the program;
       (B) the amount of savings to the National Flood Insurance 
     Program as a result of the program;
       (C) the number of property owners to whom offers were made 
     for mitigation activities under the program that initially 
     refused such offers; and
       (D) the number of owners referred to in subparagraph (C) 
     that eventually accepted such offers.
       (2) Report.--Not later than Oct. 31, 2006, the Comptroller 
     General shall submit a report to the Congress regarding the 
     results of the study.

     SEC. 4. AMENDMENTS TO EXISTING FLOOD MITIGATION ASSISTANCE 
                   PROGRAM.

       (a) Standard for Approval of Mitigation Plans.--Section 
     1366(e)(3) of the National Flood Insurance Act of 1968 (42 
     U.S.C. 4104(c) is amended by adding at the end the following 
     new sentence: ``The Director may approve only mitigation 
     plans that give priority for funding to such properties, or 
     to such subsets of properties, as are in the best interest of 
     the National Flood Insurance Fund.''.
       (b) Priority for Mitigation Assistance.--Section 1366(e) of 
     the National Flood Insurance Act of 1968 (42 U.S.C. 4104c) is 
     amended by striking paragraph (4) and inserting the following 
     new paragraph:
       ``(4) Priority for mitigation assistance.--In providing 
     grants under this subsection for mitigation activities, the 
     Director shall give first priority for funding to such 
     properties, or to such subsets of such properties as the 
     Director may establish, that the Director determines are in 
     the best interests of the National Flood Insurance Fund and 
     for which matching amounts under subsection (f) are 
     available.''.
       (c) Coordination With States and Communities.--Section 1366 
     of the National Flood Insurance Act of 1968 (42 U.S.C. 4104c) 
     is amended by adding at the end the following new subsection:
       ``(m) Coordination With States and Communities.--The 
     Director shall, in consultation and coordination with States 
     and communities take such actions as are appropriate to 
     encourage and improve participation in the national flood 
     insurance program of owners of properties, including owners 
     of properties that are not located in areas having special 
     flood hazards but are located within the 100-year 
     floodplain.''.

[[Page H11598]]

       (d) Funding.--Section 1367(b) of the National Flood 
     Insurance Act of 1968 (42 U.S.C. 4104d(b)) is amended by 
     striking paragraph (1) and inserting the following new 
     paragraph:
       ``(1) in each fiscal year, amounts from the National Flood 
     Insurance Fund not exceeding $40,000,000;

     SEC. 5. FEMA AUTHORITY TO FUND MITIGATION ACTIVITIES FOR 
                   INDIVIDUAL PROPERTIES.

       (a) In General.--Chapter I of the National Flood Insurance 
     Act of 1968 (42 U.S.C. 4011 et seq.) is amended by adding at 
     the end the following new section:


   ``grants for mitigation actions for certain individual properties

       ``Sec. 1323. (a) In General.--The Director may provide 
     funding for mitigation actions that reduce flood damages to 
     individual properties for which one or more claim payments 
     for losses have been made under flood insurance coverage 
     under this title, but only if the Director determines that--
       ``(1) such activities are in the best interest of the 
     National Flood Insurance Fund; and
       ``(2) such activities can not be funded under the program 
     under section 1366 because--
       ``(A) the requirements of section 1366(g) are not being met 
     by the State or community in which the property is located; 
     or
       ``(B) the State or community does not have the capacity to 
     manage such activities.
       ``(b) Priority for Worst-Case Properties.--In determining 
     the properties for which funding is to be provided under this 
     section, the Director shall consult with the States in which 
     such properties are located and provide assistance for 
     properties in the order that will result in the greatest 
     amount of savings to the National Flood Insurance Fund in the 
     shortest period of time.''.
       (b) Availability of National Flood Insurance Fund 
     Amounts.--Section 1310(a) of the National Flood Insurance Act 
     of 1968 (42 U.S.C. 4017(a)) is amended by adding at the end 
     the following new paragraph:
       ``(9) for funding, not to exceed $10,000,000 in any fiscal 
     year, for mitigation actions under section 1323, except that, 
     notwithstanding any other provision of this title, amounts 
     made available pursuant to this paragraph shall not be 
     subject to offsetting collections through premium rates for 
     flood insurance coverage under this title.''.

     SEC. 6. TARGETS FOR PARTICIPATION IN FLOOD INSURANCE PROGRAM.

       Section 1305 of the National Flood Insurance Act of 1968 
     (42 U.S.C. 4012) is amended by adding at the end the 
     following new subsection:
       ``(d) Targets for Participation.--Not later than December 
     31, 2004, the Director shall submit to the Congress a 
     detailed plan for increasing the percentage of properties 
     located in areas in which flood insurance coverage under this 
     title is made available that are covered by such insurance. 
     The plan shall describe specific actions to be taken to 
     ensure that such participation is not less than--
       ``(1) 55 percent as of December 31, 2005;
       ``(2) 57 percent as of December 31, 2006; and
       ``(3) 60 percent as of December 31, 2007.''.

     SEC. 7. REITERATION OF FEMA RESPONSIBILITY TO MAP MUDSLIDES.

       As directed in section 1360(b) of the National Flood 
     Insurance Act of 1968 (42 U.S.C. 4101(b)), the Director of 
     the Federal Emergency Management Agency is again directed to 
     accelerate the identification of risk zones within flood-
     prone and mudslide-prone areas, as provided by subsection 
     (a)(2) of such section 1360, in order to make known the 
     degree of hazard within each such zone at the earliest 
     possible date.

  The SPEAKER pro tempore (Mr. Gingrey). Is there objection to the 
request of the gentleman from Florida?
  Mr. FRANK of Massachusetts. Mr. Speaker, reserving the right to 
object, I just want to say that this unanimous-consent agreement 
reflects a very cooperative agreement between the majority and the 
minority. We have had a chance to go over all this. It is an agreed 
upon procedure. We have even had a chance to read the bill. And so 
because this is such a contrast to the Medicare bill and the way it has 
been handled, I do not object.
  Mr. Speaker, I withdraw my reservation of objection.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Florida?
  There was no objection.

                          ____________________