[Congressional Record Volume 149, Number 169 (Thursday, November 20, 2003)]
[House]
[Pages H11833-H11842]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   FLOOD INSURANCE REFORM ACT OF 2003

  Mr. NEY. Mr. Speaker, I move to suspend the rules and pass the bill 
(H.R. 253) to amend the National Flood Insurance Act of 1968 to reduce 
losses to properties for which repetitive flood claim payments have 
been made, as amended.
  The Clerk read as follows:

                                H.R. 253

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

     SECTION 1. SHORT TITLE.

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

     SEC. 2. CONGRESSIONAL FINDINGS.

       The Congress finds that--
       (1) the national flood insurance program (A) identifies the 
     flood risk, (B) provides flood risk information to the 
     public, (C) encourages State and local governments to make 
     appropriate land use adjustments to constrict the development 
     of land which is exposed to flood damage and minimize damage 
     caused by flood losses, and (D) makes flood insurance 
     available on a nationwide basis that would otherwise not be 
     available, to accelerate recovery from floods, mitigate 
     future losses, save lives, and reduce the personal and 
     national costs of flood disasters;
       (2) the national flood insurance program insures 
     approximately 4,400,000 policyholders;
       (3) approximately 48,000 properties currently insured under 
     the program have experienced, within a 10-year period, two or 
     more flood losses where each such loss exceeds the amount 
     $1,000;
       (4) approximately 10,000 of these repetitive-loss 
     properties have experienced either two or three losses that 
     cumulatively exceed building value or four or more losses, 
     each exceeding $1,000;
       (5) repetitive-loss properties constitute a significant 
     drain on the resources of the national flood insurance 
     program, costing about $200,000,000 annually;
       (6) repetitive-loss properties comprise approximately one 
     percent of currently insured properties but are expected to 
     account for 25 to 30 percent of claims losses;
       (7) the vast majority of repetitive-loss properties were 
     built before local community implementation of floodplain 
     management standards under the program and thus are eligible 
     for subsidized flood insurance;
       (8) while some property owners take advantage of the 
     program allowing subsidized flood insurance without requiring 
     mitigation action, others are trapped in a vicious cycle of 
     suffering flooding, then repairing flood damage, then 
     suffering flooding, without the means to mitigate losses or 
     move out of harm's way;
       (9) mitigation of repetitive-loss properties through 
     buyouts, elevations, relocations, or flood-proofing will 
     produce savings for policyholders under the program and for 
     Federal taxpayers through reduced flood insurance losses and 
     reduced Federal disaster assistance;
       (10) a strategy of making mitigation offers aimed at high-
     priority repetitive-loss properties and shifting more of the 
     burden of recovery costs to property owners who choose to 
     remain vulnerable to repetitive flood damage can encourage 
     property owners to take appropriate actions that reduce loss 
     of life and property damage and benefit the financial 
     soundness of the program; and
       (11) the method for addressing repetitive-loss properties 
     should be flexible enough to take into consideration 
     legitimate circumstances that may prevent an owner from 
     taking a mitigation action.

     SEC. 3. 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. 4. 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 Insurance 
     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 Insurance 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, 
     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--

[[Page H11834]]

       ``(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) 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 Offers.--A State or community may take 
     action under subsection (c)(2) to purchase a severe 
     repetitive loss property only if the following requirements 
     are met:
       ``(1) Use of property.--The State or community enters into 
     an agreement with the Director that provides assurances that 
     the property purchased will be used in a manner that is 
     consistent with the requirements of clauses (i) and (ii) of 
     section 404(b)(2)(B) of the Robert T. Stafford Disaster 
     Relief and Emergency Assistance Act (42 U.S.C. 
     5170c(b)(2)(B)) for properties acquired, accepted, or from 
     which a structure will be removed pursuant to a project 
     provided property acquisition and relocation assistance under 
     such section 404(b).
       ``(2) Purchase price.--The amount of purchase offer is not 
     less than the greatest of--
       ``(A) 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;
       ``(B) the total amount owed, at the time the offer to 
     purchase is made, under any loan secured by a recorded 
     interest on the property;
       ``(C) an amount equal to the fair market value of the 
     property immediately before the most recent flood event 
     affecting the property; and
       ``(D) an amount equal to the replacement value of the 
     property immediately before the most recent flood event 
     affecting the property, except that this subparagraph shall 
     apply in the case only of a property for which the State or 
     community taking action under subsection (c)(2) determines, 
     and the Director concurs, that the fair market value referred 
     to in subparagraph (C) of the property is less than the 
     purchase price of a replacement primary residence that is of 
     comparable value, functionally equivalent, and located in the 
     same community or market area but not in an area having 
     special flood hazards.
       ``(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 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 described in subsection (b)(2) for the 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 Insurance 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

[[Page H11835]]

     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 in each of 
     fiscal years 2004, 2005, 2006, 2007, and 2008, except that 
     the amount so used in each such fiscal year may not exceed 
     $40,000,000 and shall remain available until expended. 
     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 after September 
     30, 2008.''.
       (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''.

     SEC. 5. 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.''.
       (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. 6. FEMA AUTHORITY TO FUND MITIGATION ACTIVITIES FOR 
                   INDIVIDUAL REPETITIVE CLAIMS 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 repetitive insurance claims properties

       ``Sec. 1323. (a) In General.--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. 7. ACTUARIAL RATE PROPERTIES.

       (a) In General.--Section 1308 of the National Flood 
     Insurance Act of 1968 (42 U.S.C. 4015) is amended by striking 
     subsection (c) and inserting the following new subsection:
       ``(c) Actuarial Rate Properties.--Subject only to the 
     limitations provided under paragraphs (1) and (2), the 
     chargeable rate shall not be less than the applicable 
     estimated risk premium rate for such area (or subdivision 
     thereof) under section 1307(a)(1) with respect to the 
     following properties:
       ``(1) Post-firm properties.--Any property the construction 
     or substantial improvement of which the Director determines 
     has been started after December 31, 1974, or started after 
     the effective date of the initial rate map published by the 
     Director under paragraph (2) of section 1360 for the area in 
     which such property is located, whichever is later, except 
     that the chargeable rate for properties under this paragraph 
     shall be subject to the limitation under subsection (e).
       ``(2) Certain leased coastal and river properties.--Any 
     property leased from the Federal Government (including 
     residential and nonresidential properties) that the Director 
     determines is located on the river-facing side of any dike, 
     levee, or other riverine flood control structure, or seaward 
     of any seawall or other coastal flood control structure.''.
       (b) Inapplicability of Annual Limitations on Premium 
     Increases.--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 
     properties described under paragraph (2) or (3) of subsection 
     (c) and notwithstanding''.

     SEC. 8. ELECTRONIC DATABASE OF REPETITIVE LOSS PROPERTIES.

       Section 1364 of the National Flood Insurance Act of 1968 
     (42 U.S.C. 4104a) is amended by adding at the end the 
     following new subsection:
       ``(d) Electronic Database of Repetitive Claims 
     Properties.--The Director may, if the Director determines 
     such action is feasible, establish and maintain a database 
     identifying by location and address all repetitive loss 
     structures (as such term is defined in section 1370) and 
     severe repetitive loss properties (as such term is defined in 
     section 1362(b)). If established, the Director shall make the 
     database available to the public in a format that may be 
     searched electronically. Such a database shall not include 
     any information regarding ownership of properties.''.

     SEC. 9. REPLACEMENT OF MOBILE HOMES ON ORIGINAL SITES.

       Section 1315 of the National Flood Insurance Act of 1968 
     (42 U.S.C. 4022) is amended by adding at the end the 
     following new subsection:
       ``(c) Replacement of Mobile Homes on Original Sites.--
       ``(1) Community participation.--The placement of any mobile 
     home on any site shall not affect the eligibility of any 
     community to participate in the flood insurance program under 
     this title and the Flood Disaster Protection Act of 1973 
     (notwithstanding that such placement may fail to comply with 
     any elevation or flood damage mitigation requirements), if--
       ``(A) such mobile home was previously located on such site;
       ``(B) such mobile home was relocated from such site because 
     of flooding that threatened or affected such site; and
       ``(C) such replacement is conducted not later than the 
     expiration of the 180-day period that begins upon the 
     subsidence (in the area of such site) of the body of water 
     that flooded to a level considered lower than flood levels.
       ``(2) Definition.--For purposes of this subsection, the 
     term `mobile home' has the meaning given such term in the law 
     of the State in which the mobile home is located.''.

     SEC. 10. 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. Pursuant to the rule, the gentleman from 
Ohio (Mr. Ney) and the gentleman from Massachusetts (Mr. Frank) each 
will control 20 minutes.
  The Chair recognizes the gentleman from Ohio (Mr. Ney).


                             General Leave

  Mr. NEY. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
and insert extraneous material on this legislation.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentleman from Ohio?
  There was no objection.
  Mr. NEY. Mr. Speaker, I yield myself such time as I may consume.

[[Page H11836]]

  Mr. Speaker, today I rise in support of H.R. 253, a reauthorization 
of the National Flood Insurance Program. I am pleased that an 
arrangement this afternoon could be worked out between all of the 
interested parties so this bill could come up under suspension. We can 
all agree that this is a fiscally responsible bipartisan piece of 
legislation.
  Floods have been and continue to be one of the most destructive and 
costly natural hazards to our country. The National Flood Insurance 
Program is a valuable tool in addressing the losses incurred throughout 
this country due to floods. It ensures that businesses and families 
have access to affordable flood insurance that would not be available 
on the national market. The National Flood Insurance Program was 
established in 1968 with the passage of the National Flood Insurance 
Act.
  Prior to that time, insurance companies generally did not offer 
coverage for flood disasters because of the high risk involved. Today 
almost 20,000 communities participate in the National Flood Insurance 
Program. More than 90 insurance companies sell and service flood 
policies. There are approximately 4.4 million policies covering a total 
of $620 billion. In order to participate in the program, communities 
must agree to abide by certain hazard mitigation provisions. These 
provisions include adopting building codes that require new floodplain 
structures to be protected against flooding, or elevated above the 100-
year flood plain. The National Flood Insurance Program is administered 
by FEMA. It is worth noting that on November 25, 2002, President Bush 
signed into law the Homeland Security Act of 2002 which brought FEMA 
under the new Department of Homeland Security.
  The NFIP authorization expired on November 21, 2002. Unfortunately, 
Congress adjourned without extending the program. This situation was 
quickly remedied in the 108th Congress on January 13, 2003. President 
Bush signed into law a bill to reauthorize the program for 1 year 
retroactively to January 1, 2003. This 1-year reauthorization will give 
us the time necessary to determine how best to go about reforming the 
existing program.
  This is a good day for the National Food Insurance Program and a good 
day for American taxpayers. I applaud all Members for reaching 
agreement and give credit to the gentleman from Ohio (Mr. Oxley), the 
gentleman from Louisiana (Mr. Baker), the gentleman from Nebraska (Mr. 
Bereuter), the gentleman from Massachusetts (Mr. Frank), the gentleman 
from Louisiana (Mr. Tauzin), the gentlewoman from California (Ms. 
Waters), and the gentleman from Oregon (Mr. Blumenauer).
  Also, I want to note that a correction was made that was a terrible 
situation for many people in that if they moved a trailer off a 
property, they could not take it back in; and they were forced to build 
expensive, tall walls and it hurt a lot of poor people. That correction 
was made after 5 years of injustice on that. I urge my colleagues to 
support this initiative.
  Mr. Speaker, I reserve the balance of my time.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield myself such time as 
I may consume.
  Mr. Speaker, I am pleased with this legislation and, frankly, with 
the cooperative spirit that has brought it before us as a suspension. 
Members may note, there was a change in plans. Originally, we had a 
unanimous consent agreement to bring this up as a bill with an 
amendment. We have had conversations. As a result, we have an agreement 
to go forward with this bill with an amendment. It is a modification 
that will make the impact a little easier on some people in some areas 
of the country and will make it in part something of an experiment 
because we will have to revisit it after a few years, but it will 
change the essence of the bill.
  Our hope is, as a result of the spirit of compromise and flexibility 
that was shown on this side, when the bill goes elsewhere in this 
Capitol, there will be a hospitable attitude. There was, frankly, the 
prospect before that of a possible deadlock between the branches. We 
believe we have taken a step, well, more than a step, to help avoid 
that.
  The substance is very important, and I want to pay particular tribute 
to the gentleman from Nebraska (Mr. Bereuter) and the gentleman from 
Oregon (Mr. Blumenauer). One is a member of the committee, the 
gentleman from Nebraska (Mr. Bereuter); and one is not, the gentleman 
from Oregon (Mr. Blumenauer), because they took the initiative. Yes, 
people who have built in areas that are likely to flood should get some 
help from the Federal Government. The poor old Federal Government gets 
denounced a lot in general; but in particular, almost everybody finds 
some reason to want to substitute it for the pure market forces in some 
cases.
  There is a consensus here that the market does not work for some 
people with regard to flood insurance. Our position was, however, that 
we were too little reliant on economic factors. That is, we have had a 
situation where people could build, be flooded, get compensated through 
a Federal program; build, get flooded, and get compensated through a 
Federal program indefinitely. Neither in fiscal terms nor from an 
environmental standpoint was that a good idea.
  This bill is an effort, without cutting people off, to reform that 
situation. It is widely supported by virtually all of the taxpayer 
groups that worry about what they think is excessive spending, and it 
is supported by environmentalists. It is something of a compromise. I 
hope we can go forward with it and see it adopted.
  I should note, this program, the Federal Flood Insurance Program, 
expired last year. The gentleman from Ohio (Chairman Ney) and I 
collaborated earlier this year and retroactively extended it. I believe 
it was the first act this Congress took, was to make sure people were 
protected. No one is indifferent to the fate of these people.
  We did, however, say, and I thank the gentleman for his leadership, 
that we could not simply continue to extend this program. It had to be 
reformed. The gentleman from Nebraska (Mr. Bereuter) and the gentleman 
from Oregon (Mr. Blumenauer) did us a great service by taking the 
initiative there. It was supported by the gentleman from Ohio (Chairman 
Ney) and the gentlewoman from California (Ms. Waters), who is the 
ranking member; and that is where we are.
  We have now got a further compromise. I understand that is not yet 
something they have had a chance to review in the Senate. My hope is 
what we will do, and I believe there is agreement on this, is to pass a 
3-month extension in an appropriate vehicle here, which would then be 
accepted in the Senate. That would give us until March 31 of next year 
with the program fully in effect to be able to work out in the Senate 
what we believe we have successfully worked out here, namely, a 
reasonable compromise. It is in that spirit that I go forward with 
this.
  Mr. Speaker, I reserve the balance of my time.
  Mr. NEY. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Ohio (Mr. Oxley).
  (Mr. OXLEY asked and was given permission to revise and extend his 
remarks.)
  Mr. OXLEY. Mr. Speaker, let me thank the gentleman from Ohio (Mr. 
Ney) for his leadership on this issue. I certainly share the sentiments 
expressed by the gentleman from Massachusetts (Mr. Frank) regarding the 
need to really get at reforming this flood insurance program. The 1-
year extensions year after year were something that I think grated on a 
lot of folks, the taxpayer groups and the environmental groups. Had it 
not been for the gentleman from Oregon (Mr. Blumenauer) and the 
gentleman from Nebraska (Mr. Bereuter), we probably would not be here 
today. I want to give them particular acknowledgment for their efforts 
to craft a compromise, and it was not easy. We have been through this I 
do not know how many years.
  These two gentlemen have toiled in the vineyards trying to get this 
legislation passed, and it is a real tribute to their perseverance that 
we are here today. And I also thank the gentleman from Massachusetts 
(Mr. Frank) for his incisive leadership as well, as well as the 
gentleman from Louisiana (Mr. Baker) because he was an integral part of 
forming the compromise that led to a unanimous vote in the subcommittee 
as well as the full committee and bringing this to the floor today.

[[Page H11837]]

  This program is vital. We proved that by letting it expire some time 
for the first part of the year and then came back and made it 
retroactive as indicated, but we found out very quickly it was 
incredibly important from a lot of housing groups that we needed to 
move and move fast. It was, I think, the first bill that was passed in 
the last year to make up that difference.

                              {time}  1730

  This gives us an opportunity to really reform this program in the 
right way. We hopefully are in a situation where the other body can 
take a look at this. We would, of course, agree to a short-term 
extension but at the same time get some assurances that we can really 
address this problem. There are too many people out there who depend on 
this program, there are too many taxpayers who have been ripped off 
over the years by the abuse of this program, and that is what the 
reform really does.
  From the environmental side, from the taxpayer side, this is good 
legislation, crafted by the committee and made better by the gentleman 
from Louisiana (Mr. Baker) and his efforts. I want to thank all of them 
for their efforts. Also I see the gentleman from Texas (Mr. Green) who 
has also been a participant in this and has some very important issues 
to raise in terms of property values that have arisen in his Houston 
district. We were pleased to add that language to the legislation as 
well.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 2 minutes to the 
gentlewoman from Oregon (Ms. Hooley).
  Ms. HOOLEY of Oregon. Mr. Speaker, I rise in support of this 
legislation which will take important steps towards reforming the 
National Flood Insurance Program that will, in the end, benefit 
taxpayers, the environment, and people who suffer from frequent 
flooding by improving mitigation programs.
  Mitigation is important both in terms of saving lives and in terms of 
saving dollars. There is a great example of a success in one of the 
counties in my district, Tillamook County. Five rivers flow into 
Tillamook Bay, leading to frequent floods during rainy Oregon winters. 
Realizing the repeated problem with flooding they face, the county and 
local businesses and residents have stepped up to address the issue. 
From the earliest days of their participation in Project Impact, 
Tillamook has been involved in flood mitigation before anyone else knew 
what that meant, and they have reduced the damages caused by flooding 
significantly. While floods still come frequently, they no longer cause 
million upon millions of dollars in damages to residents and businesses 
thanks to the great work done in Tillamook County. In this regard, I 
believe it is important to make sure the Federal Government is a 
partner in these efforts and does not penalize Tillamook and other 
localities for their hard work. One part of this is ensuring that local 
communities, who are knowledgeable about the local businesses, are the 
ones making the decisions instead of a Federal agency like FEMA. Based 
on communications with the gentleman from Oregon (Mr. Blumenauer) and 
FEMA, local communities will indeed have the decision-making authority 
under this legislation.
  I have spoken with many local governments and civic leaders from 
Oregon, including mayors, county commissioners, city council members 
and local flood plain managers. Each have expressed their support for 
the creation of a better mitigation program to prevent flood damage 
from ever happening. This bill accomplishes that goal.
  I rise in support of the gentleman from Oregon's and the gentleman 
from Nebraska's legislation and urge my colleagues to vote in favor of 
it.
  Mr. NEY. Mr. Speaker, I yield 3 minutes to the gentleman from 
Louisiana (Mr. Tauzin).
  Mr. TAUZIN. Mr. Speaker, let me first pay special thanks and 
appreciation to the gentleman from Louisiana (Mr. Baker) who has worked 
tirelessly this week to try to find some rational amendment to this 
bill that made it somewhat better for those of us who represent 
districts that are literally so low along the coast of this country, 
mine included. You can imagine living in coastal Louisiana and most of 
the Cajuns I represent live there, very poor people in many cases who 
live and have lived there for centuries almost in that same area, to 
try to make this a little better.
  Let me explain the problem that coastal communities face, 
particularly coastal Louisiana, with a bill like this. First of all, 
the flood insurance program is kind of special in America. Flood 
victims are the only ones who are obliged to belong to an insurance 
program. We do not have an earthquake insurance program. We do not have 
a fire insurance program for the homes in California that were damaged 
by these fires. We do not have violence insurance programs for the 
urban city. What we have is a flood insurance program that we are 
mandated to join. Unlike the other disasters that strike America, 
whether it is tornadoes, earthquakes or other fire disasters out West, 
when those disasters come, this Congress, this government, responds 
fully to assist those victims through FEMA. In flood-prone areas, we 
are obliged to put up our premiums in a flood insurance program and 
that Flood Insurance Program, I am told, has not lost a dime. It is not 
paid by taxpayers. The flood losses are paid, instead, by the premiums 
that go into that fund.
  Louisiana happens to drain 43 States. Forty-three States of America, 
from the Appalachians to the Rockies, drain right through Louisiana. 
Coming from the North are tons of water, coming from the South is the 
Gulf of Mexico, and we are eroding at 35 square miles a year.
  Do we get help? Sometimes, yes, we get some levees built once in a 
while. Mostly we get resistance from the Federal Government in building 
levees to protect those poor Cajuns who live in coastal Louisiana. And 
now comes a bill that says, well, if you're unlucky enough to get 
flooded too often, you just might have to sell your home to the Federal 
Government, and then you can't do anything with your property anymore. 
You have to move out. We got kicked out of Nova Scotia in 1755, and we 
came to America, and we settled in Louisiana. You are not going to kick 
us out of Louisiana, not with this bill or any other bill.
  What is wrong with this notion is that it penalizes flood victims 
unlike it penalizes any other victims in America. First, you have to 
buy the insurance. Second, if you get flooded too many times, the 
government can take your house because you cannot pay the mitigation. 
You cannot afford to lift an old family home up 14 feet in the air. 
Thirty-five square miles of loss in erosion every year. FEMA predicts 
right now that if the folks who live in New Orleans get hit by a 
Category 4 hurricane coming through Lake Borgne or Barataria Bay, 27 
feet of water in New Orleans. It comes down to luck in some cases. If 
the storm hits you too often and you get flooded too often, you get 
penalized under this bill. If you are living in the lowest part in New 
Orleans, but you did not get flooded yet, the levees have held, you are 
okay. You do not have to sell your home, you do not have to mitigate, 
you do not have to pay excessive premiums.
  Mr. Speaker, I thank the gentleman from Louisiana (Mr. Baker) for 
helping this bill get better, but it is still a bad bill.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 6 minutes to the 
gentleman from Oregon (Mr. Blumenauer), one of the main coauthors.
  Mr. BLUMENAUER. Mr. Speaker, I appreciate the gentleman's courtesy in 
permitting me to speak on this, and I appreciate the leadership that 
has been shown by the committee, the gentleman from Ohio (Mr. Oxley), 
the gentleman from Massachusetts (Mr. Frank), the principal lead 
sponsor the gentleman from Nebraska (Mr. Bereuter) who has been working 
on this for a number of years.
  I am afraid the gentleman from Louisiana (Mr. Tauzin) fundamentally 
misses the point for why we have a flood insurance program. I find no 
small amount of irony that it was the late Hale Boggs who was one of 
the first three sponsors of the flood insurance program in 1968 
precisely because the people in Louisiana needed a program like this. I 
have encouraged my friends from Louisiana who were skeptical to maybe 
look at the facts. It is the people in Louisiana who are actually 
paying more money, and I wish the

[[Page H11838]]

gentleman from Louisiana was still here so that we could engage in a 
little bit of a colloquy at some point, but they have paid more than 
$200 million in premiums above what they have gotten back. There are a 
few of the Cajuns who are part of the 10,000 people who are flooded 
repeatedly, in many cases being paid more than the price of the 
property value. This bill would help these people. We have in our files 
correspondence from people who are trapped because of the repetitive 
flood loss. They cannot sell their property.
  This bill, contrary to what my friend from Louisiana says, would not 
force anybody to sell their property. It would, for the first time, 
provide adequate mitigation on an ongoing basis so that they would have 
a choice. They could floodproof the property, raise it if it is cost-
effective or they could relocate. Thanks to the gentleman from Texas 
(Mr. Green), there is extra provision to make sure that some of these 
low-income properties are dealt with. One of the problems is that under 
this program, other people in Louisiana would be paying much higher 
rates over time to pay for a few repetitive flood loss properties.
  Mr. Speaker, I think this bill is coming at exactly the right time. 
We are going to be able to take care of the 1 percent of the property 
that is costing thousands of policyholders in Louisiana more than they 
are putting in, and if we would take the approach of my friend from 
Louisiana, unfortunately, they would be paying even more in premium 
while other people are trapped in this repetitive flood loss cycle. 
This bill signals a higher profile and greater interest in a 
commonsense solution.
  One of the reasons the business community is so interested in it is 
because it will help make sure that the properties here can be 
financed. It will make sure that we cut down the long-term burden for 
4.5 million policyholders across the country who are paying year after 
year more money. It is not just the people in Louisiana that are being 
disadvantaged, but millions of policyholders around the country who are 
paying higher premiums than are necessary. If we are able under this 
program to defer just one 10 percent premium increase, it will mean a 
savings for policyholders across the country of $165 million each and 
every year on into the future. And there are tax dollars involved here, 
because there are countless times where the Federal Government steps in 
with disaster relief. With this program and its mitigation, we will be 
spending fewer of these tax dollars.
  Mr. Speaker, this is sound environmentally, it is sound in terms of 
economic development, it is sound in terms of helping these people in 
harm's way, and it sends the right pricing signals. It does not force 
them out of their home but it says if you are going to stay there, you 
are going to start paying a little bit more so that the rest of the 
people in Louisiana and Mississippi and Missouri and Oregon, God 
forbid, do not have to pay a disproportionate amount unnecessarily. But 
part of the advantage of this bill cannot have a price put on it. It is 
going to save lives.
  Looking in today's paper, there were three people killed yesterday in 
Maryland. I do not know what the loss is in Louisiana or Mississippi or 
Oregon. We have seen them time and time again. This is a proposal that 
is going to help get these people out of being trapped and I think not 
just save money but it is going to stop the disruption of business and 
it is going to save lives. It is right for the environment, it is right 
for the economy, it is right for the Federal taxpayers and it is right 
even for my colleague's Cajun friends who are going to end up being out 
of this flooding cycle and more people in Louisiana are going to save 
in premium dollars.
  Mr. NEY. Mr. Speaker, in a calmer, non-Cajun moment, I yield 5 
minutes to the gentleman from Nebraska (Mr. Bereuter).
  (Mr. BEREUTER asked and was given permission to revise and extend his 
remarks.)
  Mr. BEREUTER. Mr. Speaker, I first want to thank the distinguished 
gentlemen from Ohio (Mr. Oxley) and (Mr. Ney) the chairman and 
subcommittee chairman, and the distinguished gentleman from 
Massachusetts (Mr. Frank) for his tenaciousness and support for quite a 
number of years on this issue. I think I have been working on it 
approximately 14 or 16 years now, first with Congressman Joe Kennedy of 
Massachusetts, but in recent years with the help of the gentleman from 
Oregon (Mr. Blumenauer), who has been a partner in this effort and a 
tireless advocate of reform of the NFIP.
  I want to say that the bill is better coming through committee 
because of the work of the gentleman from Louisiana (Mr. Baker). He 
constantly brought issues to me and particular circumstances in his 
constituency and individually or collectively we worked out solutions 
which made the bill better. And he has helped today here in the process 
of addressing a couple of other concerns that I think are helping to 
make the bill better.
  This bill will give FEMA the needed tools to reduce the number of 
repetitive loss properties which cost the NFIP about $200 million 
annually. These properties, while comprising approximately 1 percent of 
the currently insured properties, are expected to account for 25 to 30 
percent of the claims paid. The vast majority of repetitive loss 
properties are receiving flood insurance premiums at a cost that are 
below their actuarial risk.
  As far as the contents, this legislation authorizes two programs 
which address repetitive loss properties. First, it authorizes a new 
pilot program. Second, the bill uses FEMA's existing flood management 
assistance to provide assistance to repetitive claims properties. At 
the outset, I think it is important to note that no property owner 
under this bill is ever denied Federal flood insurance except for 
fraudulent claims.
  This Member will give a brief description of these two programs. The 
pilot program authorizes up to $40 million a year to be transferred 
from the National Flood Insurance Fund over 5 years for mitigation 
assistance to severe repetitive loss properties. The pilot program 
which expires on September 30, 2008, under this legislation addresses 
these properties in a simple, straightforward manner. The owners of a 
severe repetitive loss property will be charged something closer to the 
actuarial, risk-based rates for a progressive period on their national 
flood insurance policy. That is a change we made just today in response 
to concerns brought to us.
  The first condition is that there has to be a severe repetitive loss 
property. The second condition is that the owner of the property must 
have refused a mitigation measure from a State or locality such as an 
elevation of the structure or buyout of the property. Furthermore, this 
bill would allow the director of FEMA to reduce the non-Federal cost 
share under the pilot program from the current 25 percent to as low as 
10 percent in any State that has 5 percent or more of the total number 
of severe loss properties in the U.S.

                              {time}  1745

  In 2002, for example, this benefit would be qualified for Louisiana, 
Texas, New Jersey, Florida, North Carolina, New York. So in other 
words, the non-Federal share is reduced from 25 percent to as low as 10 
percent because these States have a number of these repetitive-loss 
properties.
  So we are trying this new step to accommodate those particular costs. 
This legislation also allows any owner of a severe repetitive-loss 
property to appeal and increase to anything approaching an actuarial 
rate of insurance to an independent third party, and one of the grounds 
for appeal is that the owner of the property will not be able to 
purchase a replacement primary residence of comparable value that is 
functionally equivalent to their current residence.
  I think it is important to note the broad coalition of groups which 
are supportive of the legislation: the Heritage Foundation, the 
National Taxpayers Union, Citizens Against Government Waste, Taxpayers 
for Common Sense, the National Association of Realtors, America's 
Community Bankers, The National Association of Professional Insurance 
Agents, the Independent Insurance Agents and Brokers of America, the 
Mortgage Bankers Association, the American Bankers Association, the 
Association of State Floodplain Managers, the American Planning 
Association, the National Wildlife Federation, Friends of the Earth, 
the U.S. Public Interest Research Group,

[[Page H11839]]

American Rivers, The Ocean Conservancy, and the Coast Alliance. And 
that is a pretty broad coalition.
  I want to bring three other things to the attention of the body. 
First of all, a provision in this bill was deleted which would 
otherwise have unintentionally provided no Federal disaster assistance 
to be given to severe and repetitive-loss properties or repetitive-
claims properties if the owner refused to accept mitigation. This 
change was done in our legislation upon the very constructive 
suggestion of the distinguished gentleman from Louisiana (Mr. Tauzin).
  Lastly, a provision was included in H.R. 253 which was offered by the 
gentleman from Texas (Mr. Green). His provision addresses the issue of 
the amount of the buyout offer. Under this bill, the buyout offered by 
the States or locality would be the highest of three differential 
rates. And, finally, third, we have changed the title to more 
accurately reflect the reality that in the process of compromise, only 
one of these two programs has anything to do with two floods.
  I thank the gentleman for yielding me this time.
  This bill was introduced by this Member on January 8, 2003. It both 
authorizes the NFIP through September 30, 2008, and makes essential 
changes to the program as it relates to the mitigation of repetitive 
loss properties. The NFIP is set to expire on December 31, 2003. This 
legislation passed the House Financial Services Committee, as amended, 
without noted dissent by a bipartisan voice vote on July 23, 2003.
  This Member believes that it is important that one final public 
policy point be made. Under the NFIP, a very large regional cross-
shifting of the cost of flood insurance is occurring; the policyholders 
in nonrepetitive loss areas of the country by their higher than 
appropriate premiums are subsidizing the policyholders in repetitive 
loss areas of the country. This bill will give FEMA the needed tools to 
substantially reduce the dramatic cases of this cost-shifting to other 
NFIP policyholders.
  Mr. Speaker, in closing, we need to stop the very expensive treading 
through the water of repetitive loss after repetitive loss. Passing 
this legislation is the right thing to do at the right time. This 
Member urges his colleagues to support H.R. 253.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 3 minutes to the 
gentleman from Texas (Mr. Green), who came to us earlier and mentioned 
a particular problem affecting his State and is responsible, with the 
support of others from Texas, for a very constructive change in this 
program.
  Mr. GREEN of Texas. Mr. Speaker, I thank our ranking member and the 
chairman of the committee for working with us on this.
  The National Flood Insurance Program is absolutely essential for the 
financial security and quality of life for millions of Americans who 
live near our coasts and rivers, and it is vital to our flood-prone 
areas. And I can relate to the gentleman from Louisiana's (Chairman 
Tauzin) concern because being a neighbor of Louisiana, we have a 
problem with flooding too, although we in Texas were not thrown out of 
Nova Scotia. We were typically run off, though, because we owed 
somebody in some other State. That is why we ended up in Texas 
originally.
  So I am pleased that this legislation has been changed to reflect a 
more realistic definition of repetitive-loss properties, four strikes 
instead of the punitive two strikes in the original legislation.
  And my community will also be glad to know that people who refused a 
buyout for whatever reason will not be denied Federal disaster 
assistance should they find their lives ruined by a future event.
  As for folks who reach the definition of repetitive-loss properties 
and do receive a buyout offer from the Federal Government, the Bereuter 
substitute now allows for communities conducting these buyouts to offer 
replacement values when appropriate.
  I want to express my appreciation again to the chairman and ranking 
member of the Committee on Financial Services and the subcommittee and 
also to the gentleman from Nebraska for their support of this important 
provision. I also want to note the gentleman from Houston, Texas (Mr. 
Bell) also assisted in this.
  When FEMA came in to do a large number of buyouts after Tropical 
Storm Allison in Harris County in 2001, which flooded a total of 72,500 
homes in Houston, Harris County, we had problems finding money so folks 
getting bought out could afford another home.
  FEMA realized the necessity of replacement value in certain cases in 
my area and other areas. FEMA had to scramble to find funding from 
other programs, HUD programs and other sources, which is not ideal.
  Some of my constituents, and again I do not have a wealthy area, 
actually received offers of $12,000 for their property because that was 
fair market value, which was completely inadequate for them to purchase 
anything outside the floodplain.
  So I am pleased that the legislation incorporates our provision 
allowing communities to offer replacement value to flood victims when 
they realize that the fair market value is inadequate and FEMA agrees 
with that assessment. Without this provision, FEMA would have to deal 
with more homeowner appeals of buyout offers, and the time and the cost 
for repetitive-loss buyout projects would increase.
  Again, the bill has so many good things about it, not just a typical 
extension of the authorization. And again I want to thank the chairman 
and ranking member for working with me on the legislation and being 
willing to address the needs of the flood victims. I am proud to 
support H.R. 253.
  The SPEAKER pro tempore (Mr. Sweeney). The Chair would advise Members 
the gentleman from Ohio (Mr. Ney) has 5\1/2\ minutes remaining, and the 
gentleman from Massachusetts (Mr. Frank) has 5 minutes remaining.
  Mr. NEY. Mr. Speaker, I yield 3 minutes to the gentleman from 
Louisiana (Mr. Baker).
  Mr. BAKER. Mr. Speaker, I thank the chairman for yielding me this 
time.
  This is very difficult work. I want to start out by stating 
appreciation to the gentleman from Nebraska (Mr. Bereuter) for over a 
decade-long effort. It seems as though a lot of meaningful reforms 
around here take a decade or better. But he has been persistent, yet 
very cooperative in reaching agreements that make sense.
  It has been difficult work because we have a unique State that is a 
beneficiary of this program to a great extent over others; but as the 
gentleman from Oregon (Mr. Blumenauer) pointed out, we also make larger 
contributions than just about anybody else because our people 
participate. We pay a premium. The premium goes into a bank account. 
The bank account pays the claim. If we do not have enough money in the 
bank, we have a line of credit. In the history of the program, anytime 
a line of credit has been extended, we not only pay it back, we pay it 
back with interest. There is no other pre-need program of this sort in 
the country. It does work and provides a valuable resource to hard-
working people who live in regions of the country who suffer from 
persistent flooding.
  But we do not defend, and we are not here today to say, that people 
who abuse the program, who repetitively make claims on the program, who 
intentionally buy property for the sake of gaming the system, should be 
protected. And the bill we have before us today, to the gentleman from 
Ohio's (Chairman Oxley) credit, to the gentleman from Nebraska's (Mr. 
Bereuter) credit, the gentleman from Massachusetts (Mr. Frank), the 
gentleman from Oregon (Mr. Blumenauer), will preclude that practice 
from being encouraged in the future.
  And for those folks who happen to be listening to the debate from 
back home in Louisiana, there are some assets to this proposal which 
are very meaningful. When they finally get that designation, if it does 
occur, there is now a provision for mitigation, a new and unique 
system, where the government can actually help them. There are many 
people back home today who are trapped in these properties. They cannot 
sell them. They are below market value. Worse yet, they may be below in 
value what they owe on the property because of repetitive claims. Now 
we have the ability for the government to either buy the property at a 
reasonable price or to provide a mechanism to reduce the likelihood of 
flooding by simply elevating the home, and we do that with a new 90/10 
program where 90 percent of the money will be provided by the 
government with the homeowner putting up only 10 percent. It is new

[[Page H11840]]

landmark assistance that has never existed before.
  When we get these repetitive-loss problems off the books, I think the 
program cash flows very well; and I will continue, as I have pledged to 
the gentleman from Louisiana (Mr. Tauzin), who has expressed his deep 
concerns about where this program might be going, that in the months 
and years ahead we will continue to work to protect the interests of 
hard-working people in Louisiana to make sure that equity is the rule 
of the day. If we are going to write checks and not expect repayment 
for a California earthquake or a mudslide in the Northeast or a tornado 
in Oklahoma or a fire somewhere else and say that that is okay to use 
taxpayer money for that purpose, we have a justifiable reason in this 
case to say in Louisiana we are paying our way. We think equity cries 
out that we preserve this program. Ask us to pay the premium, run it 
properly, and hold others to account the way hard-working Louisianans 
are held to account, and all will be well with us.
  Mr. FRANK of Massachusetts. Mr. Speaker, I did want to enter my 
Russian grandparents in the ``they got run out'' contest, but I will do 
that later.
  Mr. Speaker, I yield 30 seconds to the gentleman from Oregon (Mr. 
Blumenauer).
  Mr. BLUMENAUER. Mr. Speaker, I just wanted to comment briefly because 
it is hard to get through things very quickly, but one of the things 
that was in my notes that I wanted to acknowledge was that this bill is 
a very different bill because of the contribution the gentleman from 
Louisiana (Mr. Baker) made. I personally learned a lot about the flood 
insurance program in a broader context in terms of some of the history, 
in terms of some of the dynamics and some of the perceptions that we 
need to build. My good friend from Nebraska mentioned the name change. 
It is not just symbolic. I think it is something that really reflects a 
better approach, and it would not have happened without the gentleman 
from Louisiana (Mr. Baker), and I appreciate it.
  Mr. FRANK of Massachusetts. Mr. Speaker, I yield 3 minutes to the 
gentleman from California (Mr. Thompson).
  (Mr. THOMPSON of California asked and was given permission to revise 
and extend his remarks.)
  Mr. THOMPSON of California. Mr. Speaker, I thank the gentleman for 
yielding me this time.
  I think it is very important that in the reauthorization of the 
National Flood Insurance Program that we include provisions that are 
much more forward looking and provide opportunities to communities to 
avoid catastrophic problems that a little advanced work could, in fact, 
avoid. A really good example of this can be seen in my district out in 
the Napa Valley out in California when after the major floods in 1995 
that caused about $85 million worth of damages, ruined about 27 
businesses and nearly 1,000 residential properties, the community came 
together, came together and changed the way that we do flood 
protection, recognizing that we need to build regional programs that 
will allow us to protect these properties that continually are damaged 
by flood with somewhat unconventional methods.
  The Army Corps of Engineers, resource agencies, the wine industry, 
the conservation community all came together to develop a innovative 
flood protection plan for Napa, which includes 100-year flood 
protection with the creation of a 600-acre tidal wetlands while also 
protecting the reconstruction of existing structures to prevent future 
flood damages.
  I want to commend everyone who worked so hard on this bill, and 
particularly the gentleman from Oregon (Mr. Blumenauer), who brought 
this particular emphasis to the debate. I know that we will all be 
better off. We will save businesses. We will save residential 
properties. We will save money, and we will save lives.
  Mr. NEY. Mr. Speaker, I yield 1 minute to the gentleman from Maryland 
(Mr. Gilchrest).
  Mr. GILCHREST. Mr. Speaker, I thank the gentleman for yielding me 
this time. And I thank all of the Members and the staff that have 
worked on this piece of legislation because I think fundamentally this 
brings many disparate Federal programs that are often paid for by 
taxpayers at cross-purposes into clearer focus.
  I want to make three points. One, many taxpayers pay to restore 
environmental degradation. Taxpayers provide incentives to keep people 
out of harm's way. Taxpayers pay to provide incentives to degradate the 
environment under many circumstances. Taxpayers provide incentives to 
put people in harm's way. What this legislation does is clearly view 
the problems of disparate Federal programs and provide an incentive to 
move in the right direction.
  The third point I want to make, though, I came from England to live 
in the Chesapeake Bay. I was run out of England around the time of John 
Smith. We live in a region where there are a number of storms and a 
number of people that are in harm's way. Keep in mind my perspective 
that the Federal Flood Insurance Program, the premiums paid into it 
fundamentally only pay a tiny fraction of the cost of these problems 
because we have to pay for the police, the fire department, the 
National Guard, residences where people must live. So this legislation 
brings into clear focus the needs of this problem.

                              {time}  1800

  Mr. FRANK of Massachusetts. Mr. Speaker, I yield myself the remainder 
of my time.
  Mr. Speaker, I want to again express my appreciation to the people 
working on this, and I should acknowledge, as others have, we do 
recognize that Louisiana, because of geography and history, has 
different problems and I am pleased that we were able, and I understand 
we were not able to get everybody together, but I think it was a good 
thing that because of the gentleman from Louisiana (Mr. Baker) and the 
gentleman from Louisiana (Mr. Tauzin), the bill is different than it 
would have been. They did call to our attention special problems that 
they have; we cannot always resolve everything. But I appreciate that 
we were able to move in that spirit.
  I also wanted at this point, Mr. Speaker, to say that I know the 
gentlewoman from California who has been working on this from my 
subcommittee as well as others has some concerns, and I yield to the 
gentlewoman from California (Ms. Waters).
  Ms. WATERS. Mr. Speaker, I would like to say that I am pleased that 
this bill has been reauthorized for at least 5 years. I want to say 
that the gentleman from Louisiana (Mr. Baker) makes a very good point. 
Reform is always very difficult, and we need to recognize that there 
are things that fall outside of the traditional thinking about some of 
these floodplains.
  For example, in my own city, in my district, there was flash 
flooding, the first time it ever happened in the history of the State, 
and we had this flooding and all of these little homes were damaged, 
they will not meet the FEMA assessment requirements, and we need to 
find ways in which we deal with that kind of freak of nature also. So I 
would like very much to continue to work on this.
  Mr. FRANK of Massachusetts. Mr. Speaker, reclaiming my time, I thank 
the gentlewoman. Let me say, first of all, she talked about encouraging 
thinking outside the traditional. For me she has picked a good week in 
which to do this. I have been spending a lot of time talking about some 
nontraditional thinking this week in my State Supreme Court on Tuesday. 
But in the particular issue that she mentioned, that she has alerted us 
to it, she is absolutely right. The people in her district were hit by 
some natural disaster that no one could have predicted. We need to have 
a capacity to help communities respond to the unpredictable as well as 
the predictable. And I would assure her that it is my intention, now 
that she has brought this to our attention, to see that the committee 
addresses that to the extent that we can next year.
  I also just want to say in closing, Mr. Speaker, that I am very 
pleased that we are where we are, but I should reiterate, we are at a 
point where we are, I believe, going to agree to a 3-month extension of 
this program. I hope no one thinks that simply by inaction, they are 
going to be able to coerce us, and I do not mean anybody in this room 
or who votes in this room; I just do not want anyone to think that 
inaction will force us to continue to do

[[Page H11841]]

year-by-year extensions that the chairman had talked about. We made a 
serious, good-faith compromise here. I believe it ought to be generally 
acceptable. I hope that early next year, when Congress reconvenes after 
our recess, we will be able to come forward with this bill with maybe 
some minor changes and get some further study, and it will become law. 
I hope that everyone understands that this is our chance to put this on 
the kind of indefinite footing it ought to be on.
  Mr. NEY. Mr. Speaker, I yield 1 minute to the gentleman from Florida 
(Mr. Foley).
  Mr. FOLEY. Mr. Speaker, I want to commend the gentleman from 
Louisiana (Chairman Tauzin) for recommending the Louisiana Purchase to 
Thomas Jefferson. It was a good deal then, and it remains a good deal 
today. I particularly thank my colleagues, the gentleman from Louisiana 
(Chairman Baker), the gentleman from Ohio (Chairman Ney), the gentleman 
from Nebraska (Chairman Bereuter), and the gentleman from Ohio 
(Chairman Oxley). My friend from Louisiana was very, very helpful in 
crafting amendments that have been incorporated in the bill to bring 
some fairness to policyholders that I believe were lacking in the 
original bill.
  I represent Floridians at both the Atlantic Ocean and the Gulf of 
Mexico, and we certainly see our fair share of hurricanes and tropical 
storms. The base bill would have punished people for choosing to live 
there. Does the Federal Government discriminate against people who 
choose to live in the areas that are prone to earthquakes or tornadoes? 
Of course not. Some people who live in coastal areas should not be 
punished either.
  So reauthorizing the National Flood Insurance Program is extremely 
important. I would have preferred a cleaner reauthorization, but I am 
thrilled it is for 5 years. Of course, failure to reauthorize this 
program would have disastrous consequences to policyholders, as well as 
to the banking and real estate industry in my State. I thank all for 
their cooperation, and I look forward to passage of this important 
legislation.
  Mr. NEY. Mr. Speaker, I yield myself the remaining time.
  In closing, I want to thank everybody involved with this bill. I want 
to mention the supporters of H.R. 253 include National Taxpayers Union, 
Citizens Against Government Waste, Heritage Foundation, Taxpayers for 
Common Sense, American Bankers Association, National Association of 
Realtors, America's Community Bankers, Mortgage Bankers Association, 
National Association of Homebuilders, National Association of 
Professional Insurance Agents, Independent Insurance Agents and Brokers 
of America, American Planning Association, the Association of State 
Floodplain Managers.
  Mr. FRANK of Massachusetts. Mr. Speaker, will the gentleman yield?
  Mr. NEY. I yield to the gentleman from Massachusetts.
  Mr. FRANK of Massachusetts. Mr. Speaker, the first group the 
gentleman read, the Heritage Foundation and that group, would you send 
them a note reminding them where I was on this bill, that I helped on 
this bill?
  Mr. NEY. Mr. Speaker, I will do that, and then I will make a phone 
call too, and if the gentleman wants, we will bring them to his office 
for a chat.
  Mr. OSBORNE. Mr. Speaker, I rise in support of H.R. 253, which is a 
reauthorization of the National Flood Insurance Program, introduced by 
my colleagues Congressmen Doug Bereuter and Earl Blumenauer.
  The legislation reauthorizes the National Flood Insurance Program and 
reforms it to ensure the availability of flood insurance while reducing 
the amount of money spent on frequently flooded properties.
  H.R. 253 creates a pilot program to mitigate the severe repetitive 
loss properties in the National Flood Insurance Program and sets up an 
equitable process for the treatment of policyholders who refuse 
mitigation. This legislation also uses the existing Flood Mitigation 
Assistance Program to further mitigate repetitive claims properties.
  H.R. 253 authorizes funds to be transferred from the National Flood 
Insurance Fund into the National Mitigation Fund for both the pilot 
program and the FMA program for purposes of mitigation.
  Mr. Speaker, numerous communities in my district participate in the 
National Flood Insurance Program, including the community of North 
Platte, NE.
  This community is surrounded by the North and South Platte rivers 
which merge together to form the Platte River east of North Platte.
  The citizens in North Platte have been paying substantial premiums 
for flood insurance without experiencing the flood events that other 
communities encounter.
  In fact, collectively they have paid over a $1 million in premiums 
each year, but collected a total of $26,000 in settlements.
  While the citizens of North Platte are grateful the program exists in 
the event that the 100-year flood does come, many residents are upset 
with the skyrocketing premiums for flood insurance.
  A $170,000 home in 1993 would have had a flood insurance premium of 
over $200.
  In 2003, that same property is costing over $1,000 in flood insurance 
premiums.
  Mr. Speaker, I believe this legislation will reduce the number of 
repetitive claims in areas that are frequently flooded, so communities 
like North Platte will not continue to subsidize those communities by 
paying higher premiums.
  I ask that my colleagues support this important legislation.
  Mr. RAHALL. Mr. Speaker, I rise today in opposition to this bill.
  In these waning hours of the first session of the 108th Congress, it 
is absolutely true that we need to reauthorize the National Flood 
Insurance Program, which is due to expire at the end of this year. 
However, this is not the bill with which to do so.
  I should note that there is much in this bill that I support. As an 
example, this bill will offer a multi-year reauthorization, which will 
definitely help with municipal planning. But, this bill could harm many 
of my unfortunate constituents in Southern West Virginia who have 
already suffered so much in flood damage over the last several years. 
They already have to buy flood insurance, in the first place. Now, 
their burden is going to be increased, again, under this proposal.
  Under the pilot program, which I fear may wind up covering too many 
of my constituents, this bill will disallow more than four separate 
claims payments under flood insurance if the amounts exceed $3,000 each 
or just $15,000 in total. If an individual exceeds these limits, as 
many of my constituents may, they could be forced to accept mitigation. 
At worse, mitigation means having to move to a new residence or else 
face increased insurance premiums that many of my constituents just 
can't afford.
  Mr. Speaker, my constituents in West Virginia who are suffering 
disaster aren't people who are losing beachfront vacation homes. These 
are people who are losing their livelihoods. Many of them live in homes 
built long before flood risks were even known, and their land is sacred 
to them. For many, their properties have been in the family for 
generations, and being told that you have to move is not consolation.
  Southern West Virginia has suffered massive, unpreventable, and 
unanticipated flooding since 2001. The U.S. Geologic Survey said the 
2001 flooding in the cities of Pineville and Mullens, West Virginia 
even exceeded the 100-year flood level, the estimated maximum expected 
to occur in a 100-year period, as the Guyandotte and Tug Rivers rose to 
record levels. The Governor's helicopter actually had to be used to 
rescue people off of rooftops.
  In McDowell County, we actually experienced two different 100-year 
floods in consecutive years.
  We have even experienced two floods just this week due to the severe 
weather conditions. The most recent storm damaged more homes and 
businesses across the region, and caused Governor Bob Wise to extend a 
state of emergency to 29 counties, many of which are in my district.
  Mr. Speaker, I have been working tirelessly with the U.S. Army Corps 
of Engineers, the Appalachian Regional Commission, and state and local 
authorities to combat our flood damage while seeking to prevent future 
flooding. I have even worked with the U.S. Library of Congress to 
replace books, electronic employment, and furniture destroyed at the 
McDowell Public Library. In addition, we are updating flood maps in the 
region to be able to better gauge where future flooding would be likely 
to occur.
  But, my constituents can't hold back the weather, and they need 
relief. Unfortunately, this bill, instead, seeks to limit that relief 
and maybe even force some West Virginians to have to surrender their 
dearly-held property.

[[Page H11842]]

  The SPEAKER pro tempore (Mr. Sweeney). The question is on the motion 
offered by the gentleman from Ohio (Mr. Ney) that the House suspend the 
rules and pass the bill, H.R. 253, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. VITTER. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

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