[Congressional Record Volume 160, Number 112 (Thursday, July 17, 2014)]
[Senate]
[Pages S4574-S4595]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




          TERRORISM RISK INSURANCE PROGRAM REAUTHORIZATION ACT

  The PRESIDING OFFICER. Under the previous order, the Senate will 
proceed to consideration of S. 2244, which the clerk will report.
  The assistant legislative clerk read as follows:

       A bill (S. 2244) to extend the termination date of the 
     Terrorism Insurance Program established under the Terrorism 
     Risk Insurance Act of 2002, and for other purposes.

  There being no objection, the Senate proceeded to consider the bill 
(S. 2244) to extend the termination date of the Terrorism Insurance 
Program established under the Terrorism Risk Insurance Act of 2002, and 
for other purposes, which had been reported from the Committee on 
Banking, Housing, and Urban Affairs, with amendments, as follows:
  (The parts of the bill intended to be stricken are shown in boldface 
brackets and the parts of the bill intended to be inserted are shown in 
italic.)

                                S. 2244

       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 ``Terrorism Risk Insurance 
     Program Reauthorization Act of 2014''.

     SEC. 2. EXTENSION OF TERRORISM INSURANCE PROGRAM.

       Section 108(a) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended by striking ``December 31, 
     2014'' and inserting ``December 31, 2021''.

     SEC. 3. FEDERAL SHARE.

       Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 
     2002 (15 U.S.C. 6701 note) is amended by inserting ``and 
     beginning [in the calendar year that follows the date of 
     enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014] on January 1, 2016, shall 
     decrease by [1 percent] 1 percentage point per calendar year 
     until equal to 80 percent'' after ``85 percent''.

     SEC. 4. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION UNDER THE 
                   PROGRAM.

       Section 103(e) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended--
       (1) in paragraph (6), in the matter preceding subparagraph 
     (A), by striking ``shall be'' and all that follows through 
     subparagraph (E) and inserting [``shall be $27,500,000,000 
     and beginning in the calendar year that follows the date of 
     enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014 shall increase by $2,000,000,000 
     per calendar year until equal to $37,500,000,000.''; and] 
     ``shall be the lesser of--
       ``(A) $27,500,000,000, as such amount is adjusted pursuant 
     to this paragraph; and
       ``(B) the aggregate amount, for all insurers, of insured 
     losses during such calendar year,

     provided that beginning in the calendar year that follows the 
     date of enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014, the amount set forth under 
     subparagraph (A) shall increase by $2,000,000,000 per 
     calendar year until equal to $37,500,000,000.'';

[[Page S4575]]

       (2) in paragraph (7)--
       (A) in subparagraph (A)--
       (i) in the matter preceding clause (i), by striking ``for 
     each of the periods referred to in subparagraphs (A) through 
     (E) of paragraph 6 (6)''; and
       (ii) in clause (i), by striking ``for such period'';
       [(B) in subparagraph (B)--
       (i) by striking ``for any period referred to in any of 
     subparagraphs (A) through (E) of paragraph (6)''; and
       (ii) by striking ``for such period'';]
       (B) by striking subparagraph (B) and inserting the 
     following:
       ``(B) [Reserved.]'';
       [(C) in subparagraph (C), by striking ``occurring during 
     any of the periods referred to in any of subparagraphs (A) 
     through (E) of paragraph (6)''; and]
       (C) in subparagraph (C)--
       (i) by striking ``occurring during any of the periods 
     referred to in any of subparagraphs (A) through (E) of 
     paragraph (6), terrorism loss risk-spreading premiums in an 
     amount equal to 133 percent'' and inserting ``, terrorism 
     loss risk-spreading premiums in an amount equal to 135.5 
     percent''; and
       (ii) by inserting ``as calculated under subparagraph (A)'' 
     after ``mandatory recoupment amount''; and
       (D) in subparagraph (E)(i)--
       (i) in subclause (I)--

       (I) by striking ``2010'' and inserting ``2017''; and
       (II) by striking ``2012'' and inserting ``2019'';

       (ii) in subclause (II)--

       (I) by striking ``2011'' and inserting ``2018'';
       (II) by striking ``2012'' and inserting ``2019''; and
       (III) by striking ``2017'' and inserting ``2024''; and

       (iii) in subclause (III)--

       (I) by striking ``2012'' and inserting ``2019''; and
       (II) by striking ``2017'' and inserting ``2024''.

     SEC. 5. TECHNICAL AMENDMENTS.

       The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) is amended--
       (1) in section 102--
       (A) in paragraph (3)--
       (i) by redesignating subparagraphs (A), (B), and (C) as 
     clauses (i), (ii), and (iii), respectively;
       (ii) in the matter preceding clause (i) (as so 
     redesignated), by striking ``An entity has'' and inserting 
     the following:
       ``(A) In general.--An entity has''; and
       (iii) by adding at the end the following new subparagraph:
       ``(B) Rule of construction.--An entity, including any 
     affiliate thereof, does not have `control' over another 
     entity, if, as of the date of enactment of the Terrorism Risk 
     Insurance Program Reauthorization Act of 2014, the entity is 
     acting as an attorney-in-fact, as defined by the Secretary, 
     for the other entity and such other entity is a reciprocal 
     insurer, provided that the entity is not, for reasons other 
     than the attorney-in-fact relationship, defined as having 
     `control' under subparagraph (A).'';
       ([A]B) in paragraph (7)--
       (i) by striking subparagraphs (A) through (F) and inserting 
     the following:
       ``(A) the value of an insurer's direct earned premiums 
     during the immediately preceding calendar year, multiplied by 
     20 percent; and'';
       (ii) by redesignating subparagraph (G) as subparagraph (B); 
     and
       (iii) in subparagraph (B), as so redesignated by clause 
     (ii)--

       (I) by striking ``notwithstanding subparagraphs (A) through 
     (F), for the Transition Period or any Program Year'' and 
     inserting ``notwithstanding subparagraph (A), for any 
     calendar year''; and
       (II) by striking ``Period or Program Year'' and inserting 
     ``calendar year'';

       ([B]C) by striking paragraph (11); and
       ([C]D) by redesignating paragraphs (12) through (16) as 
     paragraphs (11) through (15), respectively; and
       (2) in section 103--
       (A) in subsection (c), by striking ``Program Year'' and 
     inserting ``calendar year'';
       (B) in subsection (e)--
       (i) in paragraph (1)--

       (I) in subparagraph (A), as previously amended by section 
     3--

       (aa) by striking ``the Transition Period and each Program 
     Year through Program Year 4 shall be equal to 90 percent, and 
     during Program Year 5 and each Program Year thereafter'' and 
     inserting ``each calendar year'';
       (bb) by striking the comma after ``80 percent''; and
       (cc) by striking ``such Transition Period or such Program 
     Year'' and inserting ``such calendar year''; and

       (II) in subparagraph (B), by striking ``exceed'' and all 
     that follows through clause (ii) and inserting ``exceed 
     $100,000,000 with respect to such insured losses occurring in 
     the calendar year.'';

       (ii) in paragraph (2)(A), by striking ``the period 
     beginning on the first day of the Transition Period and 
     ending on the last day of Program Year 1, or during any 
     Program Year thereafter'' and inserting ``a calendar year''; 
     and
       (iii) in paragraph (3), by striking ``the period beginning 
     on the first day of the Transition Period and ending on the 
     last day of Program Year 1, or during any other Program 
     Year'' and inserting ``any calendar year''; and
       (C) in subsection (g)(2)--
       (i) by striking ``the Transition Period or a Program Year'' 
     each place that term appears and inserting ``the calendar 
     year'';
       (ii) by striking ``such period'' and inserting ``the 
     calendar year''; and
       (iii) by striking ``that period'' and inserting ``the 
     calendar year''.

     SEC. 6. IMPROVING THE CERTIFICATION PROCESS.

       (a) Definitions.--As used in this section--
       (1) the term ``act of terrorism'' has the same meaning as 
     in section 102(1) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note);
       (2) the term ``certification process'' means the process by 
     which the Secretary determines whether to certify an act as 
     an act of terrorism under section 102(1) of the Terrorism 
     Risk Insurance Act of 2002 (15 U.S.C. 6701 note); and
       (3) the term ``Secretary'' means the Secretary of the 
     Treasury.
       (b) Study.--Not later than 9 months after the date of 
     enactment of this Act, the Secretary shall conduct and 
     complete a study on the certification process.
       (c) Required Content.--The study required under subsection 
     (a) shall include an examination and analysis of--
       (1) the establishment of a reasonable timeline by which the 
     Secretary must make an accurate determination on whether to 
     certify an act as an act of terrorism;
       (2) the impact that the length of any timeline proposed to 
     be established under paragraph (1) may have on the insurance 
     industry, policyholders, consumers, and taxpayers as a whole;
       (3) the factors the Secretary would evaluate and monitor 
     during the certification process, including the ability of 
     the Secretary to obtain the required information regarding 
     the amount of projected and incurred losses resulting from an 
     act which the Secretary would need in determining whether to 
     certify the act as an act of terrorism;
       (4) the appropriateness, efficiency, and effectiveness of 
     the consultation process required under section 102(1)(A) of 
     the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) and any recommendations on changes to the consultation 
     process; and
       (5) the ability of the Secretary to provide guidance and 
     updates to the public regarding any act that may reasonably 
     be certified as an act of terrorism.
       (d) Report.--Upon completion of the study required under 
     subsection (a), the Secretary shall submit a report on the 
     results of such study to the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (e) Rulemaking.--Section 102(1) of the Terrorism Risk 
     Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
       (1) by redesignating subparagraph (D) as subparagraph (E); 
     and
       (2) by inserting after subparagraph (C) the following:
       ``(D) Timing of certification.--Not later than 9 months 
     after the report required under section 6 of the Terrorism 
     Risk Insurance Program Reauthorization Act of 2014 is 
     submitted to the appropriate committees of Congress, the 
     Secretary shall issue final rules governing the certification 
     process, including any timeline applicable to any 
     certification by the Secretary on whether an act is an act of 
     terrorism under this paragraph.''.

     SEC. 7. GAO STUDY ON UPFRONT PREMIUMS.

       (a) Study.--Not later than 2 years after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall complete a study on the viability and effects of 
     the Federal Government assessing and collecting upfront 
     premiums on insurers that participate in the Terrorism 
     Insurance Program established under the Terrorism Risk 
     Insurance Act of 2002 (15 U.S.C. 6701 note) (hereafter in 
     this section referred to as the ``Program'').
       (b) Required Content.--The study required under subsection 
     (a) shall examine, but shall not be limited to, the following 
     issues:
       (1) How the Federal Government could determine the price of 
     such upfront premiums on insurers that participate in the 
     Program.
       (2) How the Federal Government could collect and manage 
     such upfront premiums.
       (3) How the Federal Government could ensure that such 
     upfront premiums are not spent for purposes other than claims 
     through the Program.
       (4) How the assessment and collection of such upfront 
     premiums could affect take-up rates for terrorism risk 
     coverage in different regions and industries and how it could 
     impact small businesses and consumers in both metropolitan 
     and non-metropolitan areas.
       (5) The effect of collecting such upfront premiums on 
     insurers both large and small.
       (6) The effect of collecting such upfront premiums on the 
     private market for terrorism risk reinsurance.
       (7) The size of any Federal Government subsidy insurers may 
     receive through their participation in the Program, taking 
     into account the Program's current post-event recoupment 
     structure.
       (c) Report.--Upon completion of the study required under 
     subsection (a), the Comptroller General shall submit a report 
     on the results of such study to the Committee on Banking, 
     Housing, and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (d) Public Availability.--The study and report required 
     under this section shall be made available to the public in 
     electronic form and shall be published on the website of the 
     Government Accountability Office.

  The PRESIDING OFFICER. Under the previous order, the committee-
reported amendments are agreed to, and the bill, as amended, is 
considered as original text for purposes of further amendment.
  The PRESIDING OFFICER. The Senator from Florida.

[[Page S4576]]

  Mr. NELSON. I ask to speak for 3 minutes as in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The remarks of Mr. Nelson are printed in today's Record under 
``Morning Business.'')
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. First, I thank my good friend from Florida for his 
heartfelt and his always articulate words. We are now going to debate, 
finally, the reauthorization of the Terrorism Risk Insurance Program.
  Senator Crapo and I have opening statements, but Senator Tester, who 
has added an extremely important amendment to this legislation, has a 
markup shortly, so we are going to accede and let him speak about his 
amendment first, and then we will get on with our opening statements. I 
thank Senator Tester for his hard work on this issue as well as his 
ability to compromise to get something done.
  The PRESIDING OFFICER. The Senator from Montana.


                           Amendment No. 3552

  Mr. TESTER. I call up amendment No. 3552, ask for its immediate 
consideration, and I ask that Senator Klobuchar and Senator Pryor be 
added as cosponsors.


 =========================== NOTE =========================== 

  
  On page S4576, July 17, 2014, in the first column, the Record 
reads: AMENDMENT NO. 3552 Mr. REID. I call up amendment No. . . ..
  
  The online Record has been corrected to read: AMENDMENT NO. 3552 
Mr. TESTER. I call up amendment No. . . ..


 ========================= END NOTE ========================= 

  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from Montana [Mr. Tester] for himself, Ms. 
     Klobuchar and Mr. Pryor, proposes an amendment numbered 3552.

  (The amendment is printed in today's Record under ``Text of 
Amendments.'')
  Mr. TESTER. I thank Chairman Johnson and Ranking Member Crapo and 
Senators Schumer and Heller for their hard work on helping me on the 
TRIA bill and for helping me on this amendment, as well as Senator 
Schumer and Senator Heller for their hard work not only on the TRIA 
legislation but also on the NARAB amendment, which I am going to talk 
about in a moment. I also wish to give a special thank-you to Senator 
Johanns, who is a cosponsor on this amendment and somebody with whom I 
have worked very closely to get this amendment to the point it is 
today.
  The Tester-Johanns amendment is the National Association of 
Registered Agents and Brokers Act, otherwise known as NARAB. NARAB is a 
bill Senator Johanns and I introduced last year. It was reported out of 
the Banking, Housing, and Urban Affairs Committee on a voice vote.
  Our amendment creates a nonprofit association to provide one-stop 
licensing for insurance agents and brokers operating outside of their 
home State. This arrangement would fully preserve the authority of 
State insurance regulators to supervise these markets.
  Currently, an insurance agent or broker seeking to operate in 
multiple States must meet different State-specific licensing 
requirements and seek approval from each State's insurance 
commissioner. This process is time consuming, it is costly, it is 
redundant, and it is sometimes contradictory--without providing any 
greater consumer protection. That is a big disincentive for smaller 
agents and brokers to grow their businesses.
  This is not a new issue for the insurance industry. Congress 
recognized the need for a forum to reform the insurance licensing 
system in 1999 when it incorporated the National Association of 
Registered Agents and Brokers Act subtitle into the Gramm-Leach-Bliley 
Act. Unfortunately, at that time Congress did not immediately establish 
NARAB. As a result, Gramm-Leach-Bliley did not achieve the level of 
reciprocity and uniformity Congress expected and these efforts to 
streamline cross-state insurance licensing never took hold. That is why 
this important amendment is before the Senate today.
  Senator Johanns' and my amendment would provide insurance agents and 
brokers with the option of becoming a member of NARAB provided that 
they meet the professional standards set by the association and undergo 
a criminal background check.
  NARAB will streamline the licensing process for agents and brokers, 
enabling them to be licensed under one single, strong national 
licensing standard rather than following different State standards, 
thereby saving time and money.
  In addition to setting rigorous professional standards, the 
association will let agents and brokers renew their licenses all at 
once and fully preserve the abilities of regulators to protect 
consumers and supervise and discipline agents and brokers.
  Currently, on average, insurance agents sell their products in eight 
States, with many serving even more. A one-stop licensing compliance 
mechanism will benefit all agents and brokers but particularly the 
smaller folks who must spend time and money dealing with different 
standards in different States.
  A one-stop shop for insurance licensing will help smaller players 
compete against the bigger competitors. That is good for business, and 
it is good for consumers.
  NARAB represents a decade of effort, and I am pleased we will finally 
achieve the goals laid out in Gramm-Leach-Bliley. Some feared NARAB 
would diminish States rights. As a former State legislator, when folks 
start talking about States rights issues, I pay attention, but in this 
case I believe they are wrong.
  I wish to take a minute and talk about how this amendment protects 
States rights. Under this amendment, States would retain all authority 
to license their own resident agents and brokers. The association would 
be required to notify States when agents and brokers apply for 
membership, letting the States notify NARAB of any reason membership 
should not be granted to the producer.

  States will also have significant control over NARAB. The nonprofit 
association would be governed by a board of directors dominated by 
State insurance regulators and chaired by a State insurance regulator. 
Most importantly, NARAB deals only with marketplace entry and would not 
impact the day-to-day regulation of insurance. States will maintain 
exclusive control of the regulation of marketplace activities, consumer 
protection requirements, unfair trade practices, and other important 
areas.
  Under this bill, under this amendment, we will preserve the authority 
of States to supervise insurance producers. Any agent or broker who 
obtains the authority to operate in a jurisdiction through NARAB is 
still subject to the full regulatory authority of that State and must 
comply with all marketplace requirements. Under our amendment, States 
will continue to receive insurance licensing fees, which will be 
collected by NARAB and remitted to the States.
  This legislation is supported by the National Association of 
Insurance and Financial Advisers, the Council of Insurance Agents and 
Brokers, and the Independent Insurance Agents and Brokers of America. 
It is also supported by the National Association of Insurance 
Commissioners, which has expressed its full support for this bill and 
the final TRIA bill.
  I urge my colleagues to support the Tester-Johanns amendment. It is 
truly a commonsense amendment that helps not only the industry but also 
the consumers.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Nebraska.
  Mr. JOHANNS. Mr. President, I will begin today by acknowledging the 
good work of the good Senator from Montana. This bill has been around 
for a long time, and it is our hope that we will get to a point today 
where we can say that finally we have solved the problems.
  The Senator from Montana has done an excellent job of laying out what 
this bill is all about and what it is not about, and I don't feel a 
need today to repeat what he has said, but let me just make a couple of 
points.
  First, the partnership we had in working on this bill was excellent, 
and that is why it is this far along. It was a bipartisan effort.
  This legislation is long overdue, and it does benefit consumers and 
businesses all across this great country. It is exactly what we look 
for. It reduces redtape, it encourages competition and protects State 
law, and it promotes consumer choice. For these reasons, it is my hope 
the entire Senate unanimously supports the amendment.

  I might mention that we passed this legislation out of the banking 
committee about a year ago. That was after working on this for about 10

[[Page S4577]]

years. The House passed this bill last year by an overwhelming 
bipartisan vote, 397 to 6. So I am pleased we can advance this 
legislation today as part of the terrorism risk insurance bill, which I 
also support and will vote yes on.
  Frankly, it is refreshing to finally be allowed to vote on amendments 
on the Senate floor. I hope this is a sign of things to come. I thank 
Senator Schumer and Senator Crapo for their work in bringing us to this 
point. Without their work, TRIA would not be where it is today.
  I urge the adoption of the amendment. I hope we can move the 
legislation to the President's desk as soon as possible.
  Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Mr. President, I thank my colleagues from Montana and 
Nebraska for their hard work on not only this legislation but their 
very important amendment--long overdue. I certainly thank Senators 
Johnson and Crapo, without whose leadership we couldn't be here to pass 
this bill. I thank my original cosponsors, Senator Kirk from Illinois 
who is here, Senator Jack Reed, Senator Heller, Senator Murphy, Senator 
Johanns, Senator Warner, Senator Blunt, and Senator Menendez, all of 
whom recognized the importance of having this incredibly important 
program reauthorized.
  As author of the original TRIA legislation, I have watched this 
evolution closely. I could not be more convinced of the necessity to 
reauthorize the program for the long haul.
  I remember the dark days right after 9/11. I was there. The worst 
thing was the loss of life--people we had all known. I know people who 
were lost--a guy I played basketball with in high school, a businessman 
who helped me on the way up, a firefighter with whom I did blood 
drives. But there was also the economic worry. People thought southern 
Manhattan would not come back. People thought businesses would flee New 
York--that New York's greatest days were behind us. And of course the 
people of New York, with their resiliency, backed up by everyone in 
this country--including President Bush, very strongly--did come back. 
But the uncertainty we faced in the immediate aftermath was that there 
would be no building in southern Manhattan or Manhattan at all. And we 
have some history.
  One of the things that greatly stood in the way was the private 
sector did not offer any sufficient coverage to protect against the 
threat of terrorism. No one knew when there might be another terrorist 
incident. Insurance companies, knowing how large the losses were, 
figured it was better not to underwrite insurance than write it for 
such an astronomical sum that the building would not be even 
economically feasible.
  We have some colleagues who said this should be a private sector 
endeavor. Well, we have history. The private sector was unable, because 
of the potential economic losses if, God forbid, there was another 
terrorist attack, whether it be conventional, nuclear, or chemical, to 
provide terrorism insurance. When that occurs, banks would not finance 
buildings, knowing there was no insurance backup, and we would have 
been in huge trouble. That is why we devised the terrorism insurance 
bill.
  For those who say let the private sector do it, we have an 
experiment. We have what the scientists would call a controlled 
experiment. When there was no terrorism insurance after 9/11, the 
private sector would not offer insurance. We even find to this day, as 
the existing bill expires, fewer people underwrite terrorism insurance 
and fewer buildings are financed.
  So we can do one of two things: We can sit back and let the market 
handle this on its own and lose millions--literally millions--of jobs, 
lose economic stability, safety, prosperity, and growth or we can renew 
this legislation. We can come up with a smart, responsible, risk-
sharing system where the private sector is paying upfront. But if, God 
forbid, there is another serious incident beyond the capability of the 
private sector to shoulder, the Federal Government can step in and 
provide a backstop. That is what we have done.
  The TRIA Program is a shining example of the government partnering 
with the private sector to solve problems that neither can solve on its 
own.
  Let me underline, first, the importance to my city of New York. The 
redevelopment of downtown Manhattan is booming there. People are 
flocking to live there and work there. It is the hot area of New York 
again--not just with financial services but with law and advertising 
and high-tech. It serves as a reminder of the role the Federal 
Government can and should play in helping facilitate the stability and 
growth of cities across the country.
  This bill will not lessen the impact of a terrorist attack but will 
help ensure that our cities throughout the country are less vulnerable 
to the economic devastation that would follow such a horrific event.
  But this bill is hardly just focused on New York City. It not only 
affects every large city--my good friend from Nebraska spoke--it 
affects the football stadium and any renovations that might occur there 
in Lincoln. I have been there for a Nebraska-Oklahoma game. It was an 
amazing experience. It affects any city that has large gatherings of 
people and buildings--shopping centers, athletic facilities, colleges. 
So it affects almost every State. That is one of the reasons we have 
come together and gotten such broad bipartisan support.
  We must make sure that every reauthorization of the program provides 
the certainty lenders and developers need to make the kind of long-term 
investment our country and large projects need to stimulate job growth 
and economic growth, and this bill does just that. That is why it was 
passed out of the banking committee unanimously.
  Again, I thank my colleagues, particularly on the other side of the 
aisle. As Senator Johanns said--and we say it on each bill where there 
is some bipartisan support--this one has overwhelming support. Maybe 
this bill can be a model that at least on many issues we can work 
together.
  Time is of the essence. Insurance policies for 2015 are already being 
written. Each day that goes by without a TRIA Program causes great 
uncertainty in the market and holds back the potential for more 
development, more construction, more jobs, and more economic growth.
  I will talk about the amendments later, but I urge my colleagues, 
both here in the Senate and in the House, to move as quickly as 
possible because our economy is greatly affected by it. It is one of 
those that ``runs quiet, runs deep.'' It is a quiet policy but a policy 
that greatly affects lots of things that go on.
  Again, I thank my colleagues, Senator Crapo for his good and hard 
work, as well as Senator Johnson and my cosponsors.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAPO. Mr. President, I am appreciative of Senator Schumer and 
the work we have been able to do together to move this legislation 
forward.
  I rise today to speak in favor of S. 2244, the Terrorism Risk 
Insurance Act, or TRIA, program. As a cosponsor of this bill, I 
recognize Senator Schumer, Senator Kirk, Senator Heller, Senator Reed, 
and others for helping to put this bipartisan piece of legislation 
together.
  Chairman Johnson and his staff also deserve a great amount of thanks 
for their strong efforts in moving this bill forward.
  Working together, we developed a balanced bipartisan product that was 
literally unanimously supported in the banking committee 22 to 0. This 
bill we have put together allows the private insurance industry to 
absorb and cover the losses of all but the largest acts of terror--ones 
in which the Federal Government would likely be forced to step in, in 
any event, if the program were not there. Taxpayer protections have 
been increased in this reauthorization by moving more of the 
responsibility for losses on to private insurers.
  For those who are not familiar with the program, TRIA was initially 
passed as a response to the unavailability of terrorism insurance in 
the wake of 9/11. The private market had already retreated in response 
to those terrorist attacks. It was then thought that a temporary 
program would allow the market time to develop products that would 
allow policyholders to protect themselves from terrorism losses.
  More than a decade after the tragic events of 9/11, the temporary 
inability

[[Page S4578]]

to insure against terrorism has abated, and private capital is better 
positioned to take on more exposure to terrorism.
  When the banking committee held its first hearing on TRIA's 
reauthorization last year, we discussed the ability of the private 
insurance market to step in to provide terrorism insurance if the TRIA 
Program expired. In that hearing, and in subsequent meetings with 
providers, policyholders, and stakeholders, we recognized on a 
bipartisan basis the continued difficulties associated with providing 
terrorism insurance required that we look again at extending the act.
  Terrorism is difficult to predict. Therefore, the ability to develop 
products to insure against terrorism is very difficult to do. The size, 
severity, and frequency of attacks are hard to model. Also, attacks may 
be highly correlated, making it difficult for private insurers to 
diversify their risks.
  Having TRIA in place was determined to be important. But if the 
market is too heavily reliant on Federal support, we may deter private 
companies from coming up with cost-effective solutions. That is why, 
instead of a straight reauthorization, I and others pushed for reforms 
to maintain the program and increase protections for taxpayers.
  In order to do that, we examined each of the policy levers in the 
program. The bill marked up by the banking committee would increase the 
insurance industry's aggregate retention level and the company 
coinsurance levels. As the program stands today, the Federal Government 
would recoup any TRIA payments it makes up to $27.5 billion through 
post-event payments. This industry retention level allows the taxpayer 
to recover TRIA payments through an industrywide assessment on 
property-casualty policies. This aspect of the bill was last changed in 
the 2005 reauthorization. The bill before us today increases that 
recoupment level by $2 billion a year, to an overall level of $37.5 
billion--an additional $10 billion. This is a significant reduction in 
the potential exposure and cost to taxpayers.
  In addition, the bill increases the company coinsurance level from 15 
percent to 20 percent over 5 years. This means that before the backstop 
is reached, each company will take on a greater portion of the losses 
above their deductible.
  In order to get more private capital in the marketplace, Senator 
Flake has an amendment to create an advisory committee to promote the 
creation and development of private sector risk-sharing mechanisms. I 
support the addition of the Flake amendment and believe the advisory 
committee will find private sector solutions that will allow us to 
further decrease the program in future reauthorizations.
  Before I conclude, I have a handful of letters in my possession here 
from groups across the country strongly supporting and encouraging that 
we adopt this legislation.
  The U.S. Chamber of Commerce has listed this as a key vote. The 
Coalition to Insure Against Terrorism, which represents dozens and 
dozens of the financial sector interests across this country, 
recommends and encourages that we support this legislation, and the 
Mortgage Bankers Association, the National Association of Insurance 
Companies, the Property Casualty Insurers, the National Apartment 
Association, the National Multifamily Housing Council, and the American 
Builders Conference.
  These are just a sampling of letters we have received from interests 
across the Nation that support this legislation. I ask unanimous 
consent that these letters be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                               Associated Builders


                                        and Contractors, Inc.,

                                    Washington, DC, July 17, 2014.
     U.S. Senate,
     Washington, DC.
       Dear Senator: on behalf of Associated Builders and 
     Contractors (ABC), a national construction industry 
     association with 70 chapters representing nearly 21,000 
     members, I am writing to express our support for S. 2244, the 
     Terrorism Risk Insurance Program Reauthorization Act of 2014. 
     The bill, introduced by Sen. Chuck Schumer (D-N.Y.), would 
     extend the Terrorism Risk Insurance Act (TRIA) for seven 
     years beyond the current expiration date of December 14, 
     2014, ensuring the construction industry will be able to 
     secure sufficient terrorism insurance.
       Following the tragic attacks on our country on September 
     11, 2001, terrorism insurance rates skyrocketed and many 
     contractors were unable to secure insurance, forcing projects 
     to be put on hold, costing jobs and hindering economic 
     development. The attacks had a particularly devastating 
     impact on the construction industry: more than one million 
     jobs were lost and $15 billion in real estate transactions 
     were canceled.
       In 2002, President Bush signed TRIA into law, immediately 
     providing much needed assurance to builders and lenders. TRIA 
     acted as a spark to help our economy recover in the face of 
     continued terrorist threats by allowing contractors across 
     the country to secure this commercially necessary product.
       Since 2002, TRIA has been reauthorized twice in 
     overwhelmingly bipartisan fashion and has continued to act as 
     a public-private partnership to ensure the stability of the 
     terrorism insurance marketplace. The seven year extension 
     contained in S. 2244 would provide a long term backstop that 
     is necessary to ensure the construction industry's future 
     success. Without the extension, banks will be less inclined 
     to lend necessary funds to new construction projects and 
     companies may be forced out of the industry because of 
     financial risks, costing jobs and putting a roadblock in our 
     nation's drive to economic recovery.
       In the wake of a recession in which our industry faced a 
     27.2 percent unemployment rate, the construction economy 
     cannot sustain the uncertainty and disruption that the 
     expiration of TRIA would trigger.
       ABC and its members fully support the extension of TRIA, 
     and urges all Senators to support S. 2244.
           Sincerely,
                                                    Geoffrey Burr,
     Vice President, Government Affairs.
                                  ____

         National Multifamily Housing Council, National Apartment 
           Association,
                                    Washington, DC, July 16, 2014.
       Dear Senator: This week the U.S. Senate is scheduled to 
     consider a bill to reauthorize the Terrorism Risk Insurance 
     Act (TRIA). We commend Chairman Johnson and Ranking Member 
     Crapo for their good work on S. 2244, the Terrorism Risk 
     Insurance Reauthorization Act of 2014. It represents a 
     bipartisan, balanced approach to maintaining the necessary 
     program elements of TRIA while enhancing taxpayer 
     protections. TRIA was first enacted after the events of 9-11 
     creating a federal backstop so that affordable terrorism 
     coverage would be available and affordable for commercial 
     policyholders across the country, including apartment 
     property owners, developers and managers. The program has 
     been a successful public/private partnership and is fiscally 
     sound.
       On behalf of the National Multifamily Housing Council 
     (NMHC) and the National Apartment Association (NAA), we urge 
     your support of S. 2244. As policyholders, our members are 
     anxious to advance legislation in a swift manner to eliminate 
     the uncertainty associated with the year-end program 
     expiration.
       NMHC/NAA represent the nation's leading firms participating 
     in the multifamily rental housing industry. Our combined 
     memberships engage in all aspects of the apartment industry, 
     including ownership, development, management and finance. 
     NMHC represents the principal officers of the apartment 
     industry's largest and most prominent firms. NAA is a 
     federation of 170 state and local apartment associations 
     comprised of approximately 64,000 multifamily housing 
     companies representing nearly 7.5 million apartment homes 
     throughout the United States and Canada.
       TRIA and subsequent extensions of the program have been the 
     mechanism that provides ready access to affordable insurance 
     coverage. Terrorism risk does not resemble other commercial 
     risks. Unlike natural disasters in which insurers have had 
     significant experiences and data to project the risk of 
     damage, terrorism remains unpredictable and therefore largely 
     uninsurable. The impact of an event can be enormous, and 
     insurance modeling for such risks is still not reliable, thus 
     underscoring the importance of continued federal involvement.
       In 2012 data collected from our members relative to their 
     cost of insurance, take up rates for terrorism coverage was 
     91%. This is not insignificant and demonstrates that 
     certainty offered by TRIA in costs and coverage limits are 
     critical components in a multifamily property owner's 
     continued ability to offer safe and affordable housing.
       We thank you for your support of this measure and 
     appreciate your taking steps to move this important 
     legislation one step closer to enactment before the December 
     2014 expiration.
           Sincerely,
     Douglas M. Bibby, President,
       National Multi Housing Council.
     Douglas S. Culkin, CAE, President,
       National Apartment Association.

[[Page S4579]]

     
                                  ____
                                        Property Casualty Insurers


                                       Association of America,

                                                    July 16, 2014.
     Contact: Eileen Gilligan
     Phone: 202-639-0497
     Email: Eileen.G[email protected]

 PCI Urges the Senate To Support the Terrorism Risk Insurance Program 
                      Reauthorization Act of 2014

       Washington--Nat Wienecke, senior vice president, federal 
     government relations of the Property Casualty Insurers 
     Association of America (PCI) issued the following statement 
     in regards to the Senate's upcoming consideration of S. 2244, 
     the Terrorism Risk Insurance Program Reauthorization Act of 
     2014.
       ``PCI strongly supports passage of S. 2244, the Terrorism 
     Risk Insurance Program Reauthorization Act of 2014, and 
     commends the Senate Committee on Banking, Housing, and Urban 
     Affairs for unanimously passing this legislation and sending 
     it to the full Senate for a vote,'' said Wienecke. ``TRIA is 
     a critical part of the fabric of our national response plan 
     for terrorist attacks. Ensuring America's economic resiliency 
     to terrorist attacks is a solemn responsibility and we call 
     on the members of the Senate to vote aye and move this 
     legislation one step closer to the president's desk.''
       PCI is composed of more than 1,000 member companies, 
     representing the broadest cross-section of insurers of any 
     national trade association. PCI members write over $195 
     billion in annual premium, 39 percent of the nation's 
     property casualty insurance. Member companies write 46 
     percent of the U.S. automobile insurance market, 32 percent 
     of the homeowners market, 37 percent of the commercial 
     property and liability market, and 41 percent of the private 
     workers compensation market.
                                  ____

                                              National Association


                                of Mutual Insurance Companies,

                                                    July 16, 2014.
       Dear Senator: as the Senate completes floor consideration 
     of S. 2244, the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014, the National Association of 
     Mutual Insurance Companies respectfully urges you to vote 
     ``yes'' on this critical piece of legislation. A long-term 
     reauthorization of the TRIA program ensures a vital piece of 
     the nation's economic national security infrastructure will 
     continue to encourage private sector involvement in the 
     terrorism insurance marketplace--thereby protecting and 
     promoting our nation's finances, security, and economic 
     strength.
       NAMIC is the largest and most diverse property/casualty 
     trade association in the country, with 1,400 regional and 
     local mutual insurance member companies on main streets 
     across America joining many of the country's largest national 
     insurers who also call NAMIC their home. Member companies 
     serve more than 135 million auto, home and business 
     policyholders, writing in excess of $196 billion in annual 
     premiums that account for 50 percent of the automobile/ 
     homeowners market and 31 percent of the business insurance 
     market. More than 200,000 people are employed by NAMIC member 
     companies.
       NAMIC appreciates the bipartisan leadership of the Senate 
     Banking Committee in reporting legislation by a unanimous 
     vote which both increases taxpayer protections and which will 
     maintain a robust terrorism insurance market for consumers 
     and companies of all sizes. In particular, we applaud the 
     crafters of S. 2244 for recognizing that raising the 
     ``trigger level'' could make it impossible for many small to 
     medium-sized insurers to continue to write terrorism and 
     other business coverages without ultimately doing anything to 
     reduce taxpayer exposure.
       As it is, we are encouraging you to pass this compromise 
     legislation to reauthorize a program that has protected the 
     economic security of the United States since its creation 
     following the September 11, 2001 terrorist attacks.
           Sincerely,
     James D. Grande,
       SVP--Federal and Political Affairs, National Association of 
     Mutual Insurance Companies.
                                  ____



                                 Mortgage Bankers Association,

                                                    July 14, 2014.
     Hon. Harry Reid,
     Majority Leader, U.S. Senate,
     Washington, DC.
     Hon. Mitch McConnell,
     Minority Leader, U.S. Senate,
     Washington, DC.
       Dear Leader Reid and Leader McConnell: On behalf of the 
     Mortgage Bankers Association (MBA), I am writing to urge the 
     Senate to pass S. 2244, the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014, which was unanimously approved 
     by the Senate Banking Committee last month. With the year-end 
     expiration of the Terrorism Risk Insurance Act (TRIA) looming 
     closer, it is critical that Congress take action to pass a 
     long-term extension of the terrorism risk insurance program.
       MBA's paramount objective for TRIA reauthorization is for 
     terrorism risk insurance to remain both available and 
     affordable, in the long-term, for commercial real estate and 
     multifamily properties. The clearest path to this objective 
     is a long-term TRIA extension without modifications. If 
     changes to the program are inevitable, our perspective on 
     TRIA reauthorization legislation is then guided by its 
     potential impact on the availability and affordability of 
     terrorism risk insurance. By introducing a limited number of 
     incremental programmatic modifications, S. 2244 is consistent 
     with past reauthorization efforts that MBA has supported.
       A long-term extension of TRIA is essential to the health 
     and vitality of the $2.5 trillion commercial and multifamily 
     real estate finance sector and the nation as a whole. The 
     absence of available and affordable terrorism risk insurance 
     would not only impact the commercial real estate finance 
     center, but would ripple through the economy as buildings 
     became more difficult and costly to finance and purchase.
       Any changes to TRIA should be incremental, at most, and 
     implemented over the course of a long-term reauthorization 
     period in order to avoid unintended consequences. Past 
     reauthorization efforts for the program have introduced 
     gradual changes that did not negatively impact the 
     availability and affordability of terrorism risk insurance. A 
     departure from this approach could result in price and 
     availability shocks for terrorism risk insurance. We are 
     pleased the Senate is placing a high priority on TRIA 
     reauthorization.
       Regarding S. 2244, MBA offers the following observations:
       Long-Term Extension--MBA strongly supports the seven-year 
     extension period because it will allow for extended market 
     certainty that a terrorism risk insurance program will be in 
     place.
       Increased Recoupment--The federal government's potential 
     recoupment is increased from $27.5 billion to $37.5 billion 
     over a five-year period. The five-year adjustment period ($2 
     billion per year) represents an incremental approach to an 
     important element of the program.
       Increased Insurance Company Co-Pay--After the initial 
     deductible, the insurance company co-pay will be increased by 
     one percent a year for five years until the co-pay increases 
     from 15 percent to 20 percent. This also represents an 
     incremental change to another important element of the 
     program. TRIA reauthorization should take into consideration 
     the potential impacts on small property insurance companies.
       MBA urges all members of the Senate to vote in favor of S. 
     2244 and to oppose amendments that would weaken the TRIA 
     program. We look forward to working with Congress, other 
     policymakers, and engaged stakeholders to ensure the long-
     term reauthorization of the TRIA program as quickly as 
     possible.
           Sincerely,
                                                 David H. Stevens,
     President and Chief Executive Officer.
                                  ____

                                               Coalition To Insure


                                            Against Terrorism,

                                    Washington, DC, July 16, 2014.
       Dear Senator: The Coalition to Insure Against Terrorism 
     (CIAT) strongly urges you to support S. 2244, the Terrorism 
     Risk Insurance Program Reauthorization Act of 2014. S. 2244 
     would extend the Terrorism Risk Insurance Act (TRIA) for 
     seven years.
       CIAT represents a wide range of businesses and 
     organizations throughout the transportation, real estate, 
     manufacturing, construction, energy, education, entertainment 
     and retail sectors that regularly must obtain insurance 
     against terrorism. We know firsthand that, as part of its 
     economic national security, America needs a stable, reliable 
     terrorism competitive insurance market so employers can 
     invest in assets and create jobs without assuming the risk 
     and liabilities of a terrorist attack.
       Again, we urge you to support S. 2244 and we thank you for 
     your consideration of CIAT's concerns on this vital issue.
           Sincerely,
     The Coalition To Insure Against Terrorism.
                                  ____



                             National Association of Realtors,

                                                    July 16, 2014.
       Dear Senator: On behalf of the over one-million members of 
     the National Association of REALTORS (NAR), I urge you to 
     support S. 2244, the ``Terrorism Risk Insurance Program 
     Reauthorization Act of 2014,'' when the Senate votes on it on 
     Thursday, July 17th. This bipartisan legislation, unanimously 
     approved by the Senate Banking Committee in June, extends the 
     Terrorism Risk Insurance Act (TRIA) for seven years and makes 
     minimal changes to a program that has worked since its 
     inception in 2002 at virtually no cost to taxpayers.
       NAR's membership includes commercial practitioners and 
     brokers who work with clients that would be adversely 
     affected if TRIA is allowed to expire at the end of 2014, or 
     if it is renewed in a manner that constricts the ability of 
     private insurers to make terrorism coverage available and 
     affordable throughout the country. The current TRIA program 
     continues to be a success, keeping private terrorism 
     insurance coverage available and affordable while protecting 
     taxpayers and limiting the federal government's exposure to 
     only the most extreme events. Though we do have concerns that 
     provisions in S. 2244 to increase the mandatory recoupment 
     amount (from $27.5 billion to $37.5 billion) could adversely 
     impact the economy in the wake of a terrorist attack, overall 
     we are pleased that the bill received unanimous bipartisan 
     support from the Banking Committee. NAR urges the full Senate 
     to approve it today.
       Please give your support to S. 2244 when it reaches the 
     Senate floor. TRIA provides a crucial framework for economic 
     recovery in

[[Page S4580]]

     the wake of a catastrophic terrorist attack, and allows the 
     United States to maintain a stable terrorism insurance market 
     so employers can invest in properties and create jobs without 
     assuming the risk and liabilities of a terrorist attack. Your 
     support of this extension bill will aid in preventing market 
     uncertainty for years to come.
           Sincerely,

                                                  Steve Brown,

                                                   2014 President,
     National Association of REALTORS'.
                                  ____

         National Association of Mutual Insurance Companies, 
           Property Casualty Insurers Association of America, U.S. 
           Chamber of Commerce, Commercial Real Estate Finance 
           Council,
                                                     July 8, 2014.
     Hon. Harry Reid,
     Majority Leader, U.S. Senate,
     Washington, DC
     Hon. Mitch McConnell,
     Minority Leader, U.S. Senate,
     Washington, DC.
       Dear Majority Leader Reid and Minority Leader McConnell: 
     The undersigned organizations respectfully request quick 
     action on S. 2244, the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014. This bipartisan legislation was 
     reported last month with a unanimous vote by the Senate 
     Committee on Banking, Housing, and Urban Affairs and is 
     essential to retain the Terrorism Risk Insurance Program that 
     has protected U.S. national and economic security since its 
     creation following the September 11, 2001 terrorist attacks. 
     To date, a quarter of the Senators have cosponsored S. 2244.
       The TRIA program is a vital piece of the nation's economic 
     national security infrastructure. The federal government 
     plays an important and appropriate role in encouraging 
     private sector involvement in the terrorism insurance 
     marketplace--thereby protecting and promoting our nation's 
     finances, security, and economic strength. The Terrorism Risk 
     Insurance Program has been a remarkable success in achieving 
     its primary mission to ``protect consumers by addressing 
     market disruptions and ensure the continued widespread 
     availability and affordability of property and casualty 
     insurance for terrorism risk.''
       The undersigned parties are very appreciative of the 
     bipartisan leadership of the Senate Banking Committee in 
     reporting legislation that increases taxpayer protections 
     while retaining broad support of consumer groups and the 
     marketplace. Working together, Sens. Johnson and Crapo and 
     members of the Committee achieved consensus agreement on a 
     bipartisan piece of legislation. The bill reauthorizes the 
     TRIA program for seven years, a period of time that will 
     bring longer-term certainty to the market and facilitate 
     economic development, and increases the ultimate private 
     sector share of the responsibility for insured losses, 
     thereby reducing any potential burden on the taxpayer.
       We are particularly appreciative that the Senate consensus 
     bill largely maintains the current thresholds that facilitate 
     broad private participation in the terrorism insurance 
     market. For example, the bill maintains the current $100 
     million ``trigger''--the minimum size of a terrorist event 
     required to trigger any Federal involvement. An excessive 
     trigger could make it impossible for many small to medium-
     sized insurers to continue to write terrorism and other 
     business coverages. If insurers are forced out of the market, 
     the result is expected to be less availability of coverage 
     and less competition. That would be antithetical to TRIA's 
     stated purposes. Small and medium-sized insurers represent 
     almost 98 percent of all insurers writing TRIA coverage and 
     almost half of all TRIA-related premiums. Small and medium-
     sized insurers are a critical source of terrorism coverage as 
     well as other lines of insurance meeting all of needs of 
     American businesses large and small. The primary impact of 
     raising the trigger would be on smaller, regional, and niche 
     insurers whose deductible--and even total exposure--is less 
     than the amount of an elevated trigger level that has been 
     set too high. We applaud the crafters of S. 2244 for 
     recognizing this important fact.
       We urge the Senate to take up S. 2244 as quickly as 
     possible. Consumers are already having to purchase terrorism 
     insurance coverage that extends beyond TRIA's current 
     December 31, 2014 expiration without any certainty regarding 
     the levels of protection TRIA will provide. Many newly issued 
     policies contain conditional terrorism exclusions, which 
     could result in no protection for consumers if Congress fails 
     to act in a timely manner. While most stakeholders prefer a 
     straight extension of TRIA with no changes, we recognize and 
     appreciate the bipartisan leadership of the committee in 
     moving S.2224 forward and hope that you can reach agreement 
     to bring this legislation to the Senate floor as soon as 
     possible where we believe it will have overwhelming support.
       Given the broad support this bill has already attracted, we 
     would encourage the full Senate to consider this legislation 
     as soon as possible with minimal revisions, and in 
     particular, no amendments to raise the trigger from its 
     current $100 million level. We believe that the current 
     version of the legislation will help maintain a vital program 
     that has succeeded in fostering a robust terrorism insurance 
     market for consumers and companies of all sizes, at virtually 
     no cost to the federal government.
           Sincerely,
         National Association of Mutual Insurance Companies, 
           Property Casualty Insurers Association of America, U.S. 
           Chamber of Commerce, Commercial Real Estate Finance 
           Council.
                                  ____



                                     U.S. Chamber of Commerce,

                                    Washington, DC, July 16, 2014.
       To the Members of the United States Senate: The U.S. 
     Chamber of Commerce, the world's largest business federation 
     representing the interests of more than three million 
     businesses of all sizes, sectors, and regions, as well as 
     state and local chambers and industry associations, and 
     dedicated to promoting, protecting, and defending America's 
     free enterprise system, strongly supports S. 2244, the 
     ``Terrorism Risk Insurance Program Reauthorization Act of 
     2014,'' and applauds the Senate Committee on Banking, 
     Housing, and Urban Affairs for reporting out this important 
     bill with unanimous support.
       In the months following the 9/11 terrorist attacks, the 
     inability for insurance policyholders to secure terrorism 
     risk insurance contributed to a paralysis in the economy, 
     especially in the construction, travel and tourism, and real 
     estate finance sectors. Since its initial enactment in 2002, 
     the Terrorism Risk Insurance Act (TRIA) has served as a vital 
     public-private risk sharing mechanism, ensuring that private 
     terrorism risk insurance coverage remains commercially 
     available and that the U.S. economy could more swiftly 
     recover in the event of a terrorist attack.
       Catastrophic terrorism remains an uninsurable risk because 
     its frequency and location cannot be accurately predicted, 
     and its potential scale could be economically devastating. 
     TRIA continues to promote long-term availability of terrorism 
     risk insurance for catastrophic terror events and provides a 
     standard of stability for financial markets and recovery 
     after such an attack.
       The Chamber strongly urges you to support S. 2244, the 
     ``Terrorism Risk Insurance Program Reauthorization Act of 
     2014,'' and may consider votes on, or in relation to, this 
     bill in our annual How They Voted scorecard.
           Sincerely,
                                                  R. Bruce Josten.

  Mr. CRAPO. Getting terrorism risk insurance right is important in 
order to protect taxpayers and to limit economic and physical impacts 
of any future terrorist attacks on the United States. This bill will 
help us maintain a properly balanced terrorism risk insurance program 
that increases the Nation's economic resilience to terrorism. Again, I 
thank Chairman Johnson and Senators Schumer, Kirk, Reed, and Heller for 
their partnership in bringing this bill forward and encourage its 
adoption.

  The PRESIDING OFFICER. The Senator from Illinois.
  Mr. KIRK. Mr. President, I haven't spoken that much in this Chamber 
since I suffered that stroke. I so strongly believe in this legislation 
to make it happen.
  Behind me is a representation of the world's tallest buildings, the 
10 tallest buildings in the world. Only one is in the U.S.A. Look over 
at that tallest one. That still distresses me, the Burj Khalifa, which 
is right now the tallest building in the world. I believe as the 
Senator representing Chicagoland, the city that invented the 
skyscraper, that Chicagoland citizens have a right to grow up in the 
shadow of the world's tallest buildings. Unless we quantify the risk 
for building one of these buildings through the TRIA legislation, we 
will not return skyscrapers to the country that invented skyscrapers.
  With that I yield back the remainder of my time.
  Thank you.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Senator Crapo listed some letters and asked that they be 
put in the Record for some groups supporting our legislation.
  We have a very long list, and I ask unanimous consent that list be 
added to the Record, the supporters of the legislation.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

   Support S. 2244, the Bipartisan Terrorism Risk Insurance Program 
                      Reauthorization Act of 2014

       On April 10th, following two Banking Committee hearings on 
     the need for Congress to reauthorize TRIA, Senators Schumer 
     (D-NY), Kirk (R-IL), Reed (D-RI), Heller (R-NV), Murphy (D-
     CT), Johanns (R-NE), Warner (D-VA), Blunt (R-MO) and Menendez 
     (D-NJ) introduced the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014. The sponsors, working with 
     Banking Committee Chairman Johnson and Crapo, crafted a 
     bipartisan compromise with the following key features:

[[Page S4581]]

     Long-term extension that will promote national security, 
         economic growth and market certainty
       7 year extension of TRIA until December 31, 2021.
     Improve existing taxpayer protections
       Gradually raise the insurer co-payment from 15% to 20% over 
     5 years.
       Gradually raise the mandatory recoupment threshold from 
     $27.5 billion to $37.5 billion over 5 years.
       When considering S. 2244, the Banking Committee made 
     several improvements to the bill offered by both Republican 
     and Democratic Committee Members, including requiring a study 
     and rulemaking by the Treasury Department to improve the TRIA 
     certification process to provide better guidance and 
     certainty following events that may qualify to be certified 
     as ``acts of terror'' under the program.
     Broad support for S. 2244 and extending TRIA
       Unanimous, Bipartisan Support in Committee: By a unanimous 
     and bipartisan vote of 22-0, the Banking Committee voted on 
     June 3, 2014, to report S. 2244 to the Senate floor.
       Quarter of the Senate are Cosponsors: A quarter of the 
     Senate is now cosponsors of S. 2244, including the original 
     sponsors and Senators Blumenthal (D-CT), Booker (D-NJ), 
     Cardin (D-MD), Chambliss (R-GA), Crapo (R-ID), Donnelly (D-
     IN), Durbin (D-IL), Franken (D-MN), Gillibrand (D-NY), 
     Isakson (R-GA), Johnson (D-SD), Klobuchar (D-MN), Markey (D-
     MA), Merkley (D-OR), Mikulski (D-MD), and Tester (D-MT).
       Strong Support from a Wide Range of Stakeholders Across the 
     Country: A large number of businesses and organizations have 
     called on Congress to extend TRIA and support S. 2244, 
     including the U.S. Chamber of Commerce, American Hotel and 
     Lodging Association, Real Estate Roundtable, Realtors, 
     Mortgage Bankers Association, MLB's Office of the 
     Commissioner, NBA, NCAA, NFL and NHL.
     S. 2244 is strongly supported by a wide range of 
         organizations, including:
       American Association of Port Authorities, American Bankers 
     Association, American Bankers Insurance Association, American 
     Bankers Securities Association, American Council of 
     Engineering Companies, American Gaming Association, American 
     Hotel and Lodging Association, American Insurance 
     Association, American Land Title Association, American Public 
     Gas Association, American Public Power Association, American 
     Resort Development Association, American Society of 
     Association Executives, Associated Builders and Contractors, 
     Associated General Contractors of America, Association of 
     American Railroads, Association of Art Museum Directors, 
     Building Owners and Managers Association International, 
     Boston Properties, Campbell Soup Company.
       Coalition to Insure Against Terrorism, Cornerstone Real 
     Estate Advisers, LLC, CRE Finance Council, CSX Corporation, 
     Emerson, Financial Services Roundtable, Food Marketing 
     Institute, Helicopter Association International, Hilton 
     Worldwide, Host Hotels & Resorts, Inc., Institute of Real 
     Estate Management, InterContinental Hotel Group, 
     International Council of Shopping Centers, International 
     Franchise Association, International Safety Equipment 
     Association, International Speedway Corporation, Long Island 
     Import Export Association, Marriott International, Mortgage 
     Bankers Association, NAIOP.
       National Apartment Association, National Association of 
     Chain Drug Stores, National Association of Home Builders, 
     National Association of Manufacturers, National Association 
     of Mutual Insurance Companies (NAMIC), National Association 
     of REALTORS, National Association of Real Estate Investment 
     Trusts, National Association for Stock Car Auto Racing 
     (NASCAR), National Association of Waterfront Employers, 
     National Basketball Association, National Collegiate Athletic 
     Association, National Council of Chain Restaurants, National 
     Football League, National Hockey League, National Multifamily 
     Housing Council, National Restaurant Association, National 
     Retail Federation, National Roofing Contractors Association, 
     National Rural Electric Cooperative Association, New England 
     Council.
       Partnership for NYC, Property Casualty Insurers Association 
     of America (PCI), Public Sector Alliance, Public Utilities 
     Risk Management Association, Office of the Commissioner of 
     Baseball, The Real Estate Board of New York, The Real Estate 
     Roundtable, Securities Industry and Financial Markets 
     Association, Self-Insurance Institute of America, Inc., 
     Starwood Hotels and Resorts, Tenaska, Taxicab, Limousine & 
     Paratransit Association, UJA-Federation of New York, United 
     Airlines, Union Pacific, University Risk Management and 
     Insurance Association, U.S. Chamber of Commerce, U.S. Travel 
     Association.

  Mr. SCHUMER. Now I would like to discuss the amendment process to 
preview it for my colleagues a little bit.
  I would also ask unanimous consent that quorum calls be counted 
equally against both sides.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SCHUMER. As was mentioned, I believe by some of my colleagues, 
the give-and-take on this bill was ideally how things should work. 
First, a bipartisan group of Senators got together and crafted the 
legislation. As Senator Crapo noted, there was some push and pull, what 
should be the balance between government and the private sector, and we 
did move a little bit more in giving greater responsibility to the 
private sector. People should note that at the end of the day the 
private sector will pay back all the money the government would lay out 
if, God forbid, there is a terrorist incident, but it would be over a 
period of time of course.
  But we had Democrats and Republicans come together and we came up 
with a bill. The chairman and ranking member agreed that the bill was a 
good idea, held hearings, and then we moved forward with the 
legislation.
  Then always comes the even greater morass. We do get some bills 
passed out of this place with bipartisan support and many of them are 
significant bills, but then we go to the floor and we wonder what is 
going to happen now. We have the age-old dispute about how many 
amendments, what type of amendments, should they be relevant. In this 
case we asked colleagues on both sides of the aisle who would want 
amendments.
  The amendments that came back were reasonable. Most--not all--were 
related to terrorism insurance. Those that weren't, such as by Senator 
Tester and Senator Vitter, were in the jurisdiction of the Banking 
Committee, so they at least had some relationship. We did not get a 
flurry of amendments from all over the place on issues that naturally 
divide the parties.
  Then we had to do some negotiating, but we allowed--Senator Crapo and 
Senator Johnson allowed every amendment, that any author who wanted to 
offer an amendment could. We worked out some compromises on the Tester 
amendment. Senator Coburn had objections, and a compromise was worked 
out there. Some were withdrawn, but at the end of the day anyone who 
wanted an amendment got it. Both sides showed restraint, and I think 
that is what brought us to this position.
  So the good news for my colleagues, we have a very limited number of 
amendments, and we intend to dispose of the entire bill before lunch 
this morning.
  Let me briefly go over the amendments.
  Senator Coburn will offer an amendment on recoupment timing. The 
Coburn amendment would give the Treasury Secretary the ability to 
extend the recoupment period of up to 10 years following an attack. The 
problem is the way Senator Coburn had drafted his amendment, it would 
create a significant score. He offered in it the Banking Committee and 
it failed on a bipartisan vote, the majority of both parties, I 
believe, voting against it. But he wanted to offer it on the floor, and 
so he will.
  There is a point of order, a pay-go point of order that will be 
raised against the Coburn amendment, and I will raise that because it 
does break the budget. It doesn't have a pay-for in exchange for it. So 
Chairman Johnson and I believe the sponsors of the legislation 
recommend a ``no'' vote on waiving pay-go against the Coburn amendment.
  The Tester amendment, as modified by Senator Coburn, I believe will 
be voice-voted. Senator Tester and Senator Johanns described that 
adequately, but it is something long overdue that would create a 
National Association of Registered Agents and Brokers and make the 
whole brokerage business work more smoothly. It has very broad support 
in this body.
  Senator Vitter will offer an amendment that would require the 
President to nominate at least one individual with primary experience 
working in or supervising community banks on the Federal Reserve Board 
of Governors. I am sure he will come to the floor to explain his 
amendment. We expect this amendment, which we will all agree to, will 
be approved by voice vote, and Chairman Johnson has recommended a voice 
vote to the Members on our side.
  Finally, there is a Flake amendment that would create an advisory 
committee on risk-sharing mechanisms. Again, I think Senator Flake will 
come down at some point and explain his amendment. There will be a 
recorded vote on this at least as planned now, and I will be supportive 
and I know Chairman Johnson again has recommended a ``yes'' vote on the 
Flake amendment.

[[Page S4582]]

  With that, I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. FLAKE. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded. 59/b
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 3551

  Mr. FLAKE. I ask unanimous consent to temporarily set aside the 
pending amendment so I may call up my amendment 3551, which is at the 
desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report the amendment.
  The legislative clerk read as follows:

       The Senator from Arizona [Mr. Flake] proposes an amendment 
     numbered 3551.

  The amendment is as follows:

     (Purpose: To establish the Advisory Committee on Risk-Sharing 
                              Mechanisms)

       On page 13, after line 22, insert the following:

     SEC. 8. ADVISORY COMMITTEE ON RISK-SHARING MECHANISMS.

       (a) Finding; Rule of Construction.--
       (1) Finding.--Congress finds that it is desirable to 
     encourage the growth of nongovernmental, private market 
     reinsurance capacity for protection against losses arising 
     from acts of terrorism.
       (2) Rule of construction.--Nothing in this Act, any 
     amendment made by this Act, or the Terrorism Risk Insurance 
     Act of 2002 (15 U.S.C. 6701 note) shall prohibit insurers 
     from developing risk-sharing mechanisms to voluntarily 
     reinsure terrorism losses between and among themselves.
       (b) Advisory Committee on Risk-Sharing Mechanisms.--
       (1) Establishment.--The Secretary of the Treasury shall 
     establish and appoint an advisory committee to be known as 
     the ``Advisory Committee on Risk-Sharing Mechanisms'' 
     (referred to in this subsection as the ``Advisory 
     Committee'').
       (2) Duties.--The Advisory Committee shall provide advice, 
     recommendations, and encouragement with respect to the 
     creation and development of the nongovernmental risk-sharing 
     mechanisms described under subsection (a).
       (3) Membership.--The Advisory Committee shall be composed 
     of 9 members who are directors, officers, or other employees 
     of insurers, reinsurers, or capital market participants that 
     are participating or that desire to participate in the 
     nongovernmental risk-sharing mechanisms described under 
     subsection (a), and who are representative of the affected 
     sectors of the insurance industry, including commercial 
     property insurance, commercial casualty insurance, 
     reinsurance, and alternative risk transfer industries.
       (c) Effective Date.--The provisions of this section shall 
     take effect on January 1, 2015.

  Mr. FLAKE. Mr. President, I am pleased to have the opportunity to 
offer this amendment. I thank my colleagues, the ranking member of the 
Banking Committee, and the senior Senator from New York for working 
with my office to make this possible.
  The Terrorism Risk Insurance Program Reauthorization Act before us 
extends for 7 years the Federal loss sharing program developed in 
response to the market destructions that were caused by 9/11. Created 
in 2002, the Terrorism Risk Insurance Program was intended to be just a 
3-year program. This program has since been extended twice, and the 
bill before us would extend its life through December 31, 2021.
  Given the longevity of the program, I think it would be prudent for 
us to focus some attention on the growing private market reinsurance 
capability and capacity.
  My amendment simply establishes an advisory committee composed of 
members of the insurance industry to provide recommendations to 
accelerate the creation and development of private nongovernmental 
risk-sharing mechanisms for terrorism losses. I urge my colleagues to 
join me in taking this modest step toward developing a functioning 
private-run market for terrorism risk insurance, thereby reducing 
dependency on the Federal Government in this regard.
  I yield the floor and I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. CRAPO. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Booker). Without objection, it is so 
ordered.
  Mr. CRAPO. Mr. President, I wish to take this opportunity to make 
comments on a couple of the amendments that have been or will be 
presented to the bill.
  First, with regard to the amendment presented by Senator Flake. As I 
mentioned in my opening remarks, I support this amendment. One of the 
issues we deal with in the reauthorization of TRIA each time we face it 
is the correct balance and the level of government protection and 
support that needs to be in place to help the market deal with major 
catastrophic events in the United States and the level of requirement 
we insist there be from the private sector and how they will step in 
and deal with these risks on an insurance basis rather than requiring 
the taxpayers to be the ultimate backstop.
  Ultimately our objective should be and must be that the taxpayer be 
relieved of this kind of burden and that the private sector step in and 
cover the risks through our private sector insurance markets. I think 
we have a pretty broad consensus that we are not at the level yet where 
we can get there, but each time we have reauthorized TRIA, we have 
moved it closer to that objective, and this legislation itself moves it 
closer.
  As I said in my introductory remarks, we have increased the retention 
level--in other words, the amount of money the private sector must pay 
back to the Treasury if the taxpayer is ultimately required to step in 
and backstop a catastrophic terrorist attack. This legislation will 
increase that amount by another $10 billion--from $27.5 billion to 
$37.5 billion. We are also increasing the amount of money which the 
private sector insurance industry must put up upfront before the 
government steps in and provides a backstop. We are increasing that 
from a 15-percent copay to 20-percent copay.
  We are taking significant steps in this legislation to get to the 
ultimate objective of having the private sector fully handle the 
insurance risk due to a catastrophic terrorist attack.
  Senator Flake has provided an amendment, which I support, that would 
help us create an advisory committee that will focus on this specific 
issue and help us to find private sector solutions to allow us to 
further decrease the program in the future reauthorizations. I think 
this is an incredibly important amendment, and I believe there is 
strong bipartisan support for it. It allows us to have advice and 
support from this advisory committee that would be created under his 
amendment to take further and more important steps toward achieving the 
ultimate objective of having to be able to eliminate the need for 
taxpayer involvement in dealing with catastrophic events such as a 
terrorist attack.
  I strongly support the addition of the Flake amendment. I believe the 
advisory committee he proposes will find private sector solutions which 
will allow us to further decrease and ultimately eliminate the program 
in future reauthorizations.
  Another amendment that has been discussed on the floor today by 
Senator Tester of Montana and Senator Johanns of Nebraska is the NARAB 
amendment, which is an amendment that will be added to this 
legislation. This is also an important piece of legislation from the 
banking committee and it is called the National Association of 
Registered Agents and Brokers, or NARAB. Again, it is a bipartisan 
piece of legislation that has strong support across the United States 
in various industries to try to allow our registered agents and brokers 
to have a more efficient and effective system in which to obtain 
necessary authorization to conduct their business nationwide.
  I am an original cosponsor of this language because it simplifies the 
process of agent licensing across State lines while preserving the 
authority of State insurance regulators. This bill has broad support 
from the insurance community, including the National Association of 
Insurance Commissioners, the Independent Insurance Agents and Brokers 
of America, the National Association of Insurance and Financial 
Advisers, and the Council of Insurance Agents and Brokers.
  The creation of NARAB will allow agents and brokers to focus on their 
responsibilities to their clients and spend

[[Page S4583]]

less time dealing with redtape. By reducing costs and increasing 
competition among insurance producers, we will generate lower costs and 
better service for consumers. Importantly, NARAB II deals specifically 
with marketplace entry and would not impact the States' jurisdiction 
over day-to-day authority in the insurance marketplace. This is a very 
critical point because I believe one of the biggest issues relating to 
this legislation is preserving and protecting States rights and State 
jurisdiction with regard to regulation of the insurance marketplace.
  Insurance commissioners of the States will be able to better catch 
bad actors who, after losing a license in one State, move quickly to 
enter into another State. State regulators will serve on the board of 
NARAB with the same objectives they have as insurance commissioners--to 
protect the public interest by promoting the fair and equitable 
treatment of insurance consumers.
  The idea for NARAB is now 14 years old. We have literally been 
working on it for that long, and I am hoping we can get this 
legislation across the finish line today.
  These are two important amendments that will come forward today with 
regard to the TRIA legislation, and there are several more. As we move 
forward today I am hopeful we will make the kind of progress on these 
important and critical issues that will enable us to not only pass this 
legislation but to do so with a strong vote here in the Senate and then 
get us into a conference with the House so we can put this important 
legislation, which has been developed on a bipartisan basis, on the 
President's desk.
  Far too often we are seeing gridlock in this Chamber. We have two 
pieces of legislation today where we have a bipartisan agreement and 
bipartisan support, and I think it is a good day for the Senate to see 
this kind of legislation moving forward.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Connecticut.
  Mr. MURPHY. Thank you, Mr. President. Let me join my friend Senator 
Crapo in congratulating the leadership on both the Republican and 
Democratic side and the leadership on the banking committee for 
bringing this bill before us this morning. It is, unfortunately, all 
too rare when we can bring a piece of legislation to the floor that has 
been worked on by both sides of the aisle and has broad agreement on 
both sides of the aisle. Of course, as the Senator from Idaho knows, 
there is nothing partisan about the effects of not reauthorizing TRIA. 
This is going to affect every part of the country. Republicans and 
Democrats, people of liberal and conservative persuasions, will 
ultimately be paying a lot more and losing a lot more because of our 
failure to get this bill done. So let me again thank Senator Crapo and 
Senator Johnson for all the work they have done. I was one of the 
original cointroducers of this bill, along with Senator Schumer and 
Senator Reid, as well as Senators Menendez, Warner, Kirk, Heller, 
Johanns, and Blunt.
  Ultimately, we were educated by what happened in the weeks and months 
following September 11. In that period of time, the real estate market 
in large parts of this country--certainly in my part of the country 
surrounding New York City--collapsed. As a result, $15 billion worth of 
projects stalled overnight, and we lost about 300,000 construction jobs 
that were planned to come online--all because the insurance industry 
decided, with justification, that they could no longer insure for the 
risk of terrorism. Prior to September 11 we got coverage for terrorism 
essentially at no cost. But after September 11, again, for good reason, 
for good cause, insurers, without knowing what their exposure was going 
to be should there be another attack, decided they could no longer 
insure for that risk. So, in this sense, it logically fell to the 
Federal Government to provide that assurance that no matter where one 
is--whether in Idaho or Nebraska or Connecticut or New Jersey--if a 
person is building a project and they were the subject of terrorism, 
they would get a backstop of protection for those losses.
  Some said at the time: Why don't we treat insurance, when it comes to 
protecting for terrorism, the same as we protect against other 
disasters? Of course, we see these threats as fundamentally different. 
We can make a decision as to whether we want to live in a part of the 
country that may be subject to greater risk from floods or hurricanes. 
So we have grown to accept the fact that we are going to pay a little 
bit more if we are going to have a house or a business right on the 
water. And we have a program here by which we mitigate that risk so 
that it is not extraordinarily different, understanding there is still 
good reason why people have to congregate in those spaces. But a 
terrorist attack, frankly, whether it happens in New York City right on 
the precipice of Connecticut, or in Los Angeles or in a rural 
environment in the Midwest, is an attack on the United States of 
America. That is an attack on all of us, no matter what specific 
geography in which it happens to be located. So that is why we made the 
decision as a Nation to help backstop those localities that may feel 
the initial burden of having to reconstruct after a terrorism attack, 
because we believe it is a national responsibility.
  So for the practical reason that there was no longer an ability for 
the insurance industry to calculate how on Earth they would assess a 
premium based on the enormous potential loss of a terrorist event, and 
because of the fact that as Americans we felt as though we should come 
together and insure against this risk, we passed TRIA initially. Over 
time we have come together as Republicans and Democrats to reauthorize 
it.
  Now, as time has gone on, we have had a conversation about how to 
best share this responsibility between the public sector and the 
private sector, because we expect that private insurers still should, 
as is their business, pick up some of this cost. So this version of the 
bill continues along the line of transferring some of this 
responsibility from the Federal Government and the Federal taxpayers to 
private insurers. For instance, the underlying legislation continues to 
have a 20-percent deductible. But after that 20-percent deductible is 
met, under the previous version of the bill the insurer was responsible 
for picking up 15 percent of the cost. Under this bill they are going 
to pick up 20 percent of the cost. So there is a little bit more 
responsibility built in for the cost of paying out claims after a 
terrorist attack is picked up by insurers.
  There is a provision in the bill which says the Federal Treasury will 
recoup the costs from insurers of any claims it pays out. It can do 
that over a long period of time. Previously, it was mandatory to recoup 
all of that money for claims under $27 billion. Now that number is $37 
billion. So we now have a mandatory return to the Treasury of any 
claims under $37 billion, which is an additional protection for 
taxpayers as well as an additional responsibility for insurers now 
because we will collect from the insurers for losses up to a higher 
amount than the previous law. I think all of this is pretty reasonable.
  I wish there were more days such as this and weeks such as this--
although maybe TRIA isn't infused with the same kind of politics that 
other issues such as immigration reform and energy reform and criminal 
justice reform can be--but this was made possible by some really hard 
work by a number of people who knew this was right to do for the 
country. Speaking as a Senator from a State that has a big stake in the 
reauthorization of TRIA, I say thank you to all of the people who made 
this possible and give an advanced shout-out to the House of 
Representatives which we hope will pass this bipartisan bill in an 
expeditious manner. Connecticut cares about this because we were, as I 
said, on the edge of the attack of September 11. We lost dozens and 
dozens of Connecticut residents in that attack. Our economy was 
effectively shut down because of the inability to assess this risk 
throughout the real estate sector surrounding New York City. But we 
also are home to some of the biggest and, frankly, most responsible 
property and casualty insurers. The Hartford and Travelers, in 
particular, have been a big part of trying to figure out a public-
private partnership to solve this problem, and this certainly helps 
them to be able to provide more of a very important product to the rest 
of the country.

  So, again, my thanks to all of those who made this piece of 
legislation possible. My hope is we get a big vote later today across 
the aisle, sending a message to the House of Representatives

[[Page S4584]]

that they can take this bipartisan piece of legislation, pass it, and 
then get it to the President's desk. Then we can, once again, give some 
sense of surety to our insurance markets and our real estate market 
that the United States of America is, once again, going to step up and 
decide that terrorism, no matter where it happens--whether it is in New 
York City or in Topeka--is not going to get this country back.
  I yield the floor, and I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll. The assistant 
legislative clerk proceeded to call the roll.
  Mr. VITTER. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 3550

  Mr. VITTER. Mr. President, I ask unanimous consent to temporarily set 
aside the pending amendment so that I may call up my amendment No. 
3550, which is at the desk.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:

       The Senator from Louisiana [Mr. Vitter] proposes an 
     amendment numbered 3550.

  Mr. VITTER. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To reaffirm the importance of community banking and community 
     banking regulatory experience on the Federal Reserve Board of 
   Governors, to ensure the Federal Reserve Board of Governors has a 
 member who has previous experience in community banking or community 
                          banking supervision)

       On page 13, after line 22, add the following:

     SEC. 8. MEMBERSHIP OF BOARD OF GOVERNORS OF THE FEDERAL 
                   RESERVE SYSTEM.

       (a) In General.--The first undesignated paragraph of 
     section 10 of the Federal Reserve Act (12 U.S.C. 241) is 
     amended by inserting after the second sentence the following: 
     ``In selecting members of the Board, the President shall 
     appoint at least 1 member with demonstrated primary 
     experience working in or supervising community banks having 
     less than $10,000,000,000 in total assets.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of enactment of this Act and 
     apply to appointments made on and after that effective date, 
     excluding any nomination pending in the Senate on that date.

  Mr. VITTER. Mr. President, I rise to talk about this amendment which 
I look forward to being adopted on this important terrorism risk 
insurance reauthorization bill. It is a commonsense amendment. It is 
about the Federal Reserve Board, and it says at least one member of 
that important Board should have significant experience as a community 
banker or a community bank supervisor.
  This used to be commonplace because community banks--smaller 
institutions--were and are an important part of our financial system. 
In fact, these days it is one part of our financial system that sets us 
apart from many others, such as Canada and Europe, which are far more 
dominated by mega-institutions. Of course, the United States has some 
very big institutions, and they serve an important role and they have 
an important place, but smaller institutions, so-called community 
banks, serve a vital role as well and particularly in smaller 
communities and in more rural areas they serve those communities in a 
way megabanks simply do not.
  I have been looking at this trend on the Federal Reserve, and 
unfortunately there is an unmistakable trend away from having adequate 
representation from folks with community bank experience; that same 
trend has been toward having the Federal Reserve Board completely 
dominated by academics and folks with megabank and academic economist 
experience.
  This chart I have in the Chamber shows that trend. From 1936 until 
the present, it goes decade by decade. The chart is a little busy, and 
we have this color coding here, but basically we can see this huge 
growth in the domination of this red category: folks with pure academic 
economic experience. Folks with community bank experience, which used 
to actually dominate the Federal Reserve Board several decades ago, are 
now very limited.
  Look, there is nothing wrong with folks with academic experience, but 
it should not be so dominant on the Federal Reserve and we should have 
regular representation from community banks or community bank 
supervisors because that is a vital part of our banking system.
  My amendment is therefore very simple. It would mandate that at least 
one member of the Federal Reserve Board have that experience, have 
direct community bank experience or have direct experience as a 
community bank supervisor. Specifically, we are talking about 
institutions with less than $10 billion in total assets.
  This bill follows a letter several of my colleagues joined me in 
sending to President Obama. We were asking him to nominate an 
individual with that sort of experience, and I thank the cosigners on 
that letter: Senators Tester, Moran, Merkley, Coburn, and Johanns on 
the committee; and noncommittee Members Senators Hirono, King, Franken, 
Baldwin, Begich, Landrieu, Heinrich, and Udall.
  We seem to be making progress in that regard. There is widespread 
reporting that the White House is considering a list of candidates for 
the Federal Reserve with community banking experience. But this 
specific mandate--just one member, a very modest mandate--would help 
ensure that happens and would help ensure that regularly happens into 
the future to reverse this trend, to get more balance on the Federal 
Reserve Board.
  This is very important in the context of the too-big-to-fail debate. 
Too big to fail helped lead to the crisis several years ago in the 
banking industry. It helped lead to the massive bailouts of mega-
institutions, and unfortunately I am one who believes--and there are 
many others--that too big to fail is alive and well today, and in some 
ways Dodd-Frank institutionalized too big to fail. It did not end too 
big to fail in any way.
  We need to do a number of things to even the playing field, to make 
it fairer for smaller institutions, community banks that serve our 
smaller communities in rural areas, particularly on the Federal Reserve 
Board, which is such a significant governing and supervisory board in 
our banking industry.
  I specifically thank the ranking member of the committee, Senator 
Crapo, for his support of this concept, his support in negotiations of 
this amendment, and his very active involvement in getting this 
amendment accepted on to the TRIA bill.
  I think the ranking member may have a few words about this and other 
matters. I will relinquish the floor.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAPO. Mr. President, I will just take a moment to speak about 
Senator Vitter's amendment, which I strongly support.
  During Dr. Yellen's nomination hearing, I noted the need to fill 
additional vacancies at the Federal Reserve Board with individuals 
bringing balanced viewpoints. The President should nominate someone 
with community bank experience to the Board to fill at least one of the 
remaining vacancies.
  Community banks play an important role in their local economies and 
face a disproportionate burden from our existing regulations. We should 
ensure that the perspective of these banks is represented in 
policymaking. That is what this amendment does, and I encourage my 
colleagues to support it.
  The PRESIDING OFFICER. The Senator from Louisiana.
  Mr. VITTER. Mr. President, just one final wrapup issue. I ask 
unanimous consent to have printed in the Record a letter of support for 
this amendment from ICBA, the Independent Community Bankers of America.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                             Independent Community


                                           Bankers of America,

                                    Washington, DC, July 17, 2014.
     U.S. Senate,
     Washington, DC.
       Dear Senator: On behalf of the Independent Community 
     Bankers of America and the more than 6,500 community banks 
     nationwide, I write to urge you to vote YES on Amendment 
     3550, offered by Senator David Vitter, to the Terrorism Risk 
     Insurance Program Reauthorization Act of 2014 (S. 2244). This 
     amendment would ensure at least one member of the Board of 
     Governors of the Federal Reserve (the Board) has experience 
     as a community banker or as a supervisor of community banks. 
     The Board not only plays

[[Page S4585]]

     a key role in our economy by promoting employment and stable 
     prices, but is also an important regulatory body for the U.S. 
     and global financial system. A broad range of representation 
     on the Board is critical to its effectiveness.
       Community banks are vitally important to the nation's 
     economy, particularly with respect to small business lending 
     and providing banking services in small and rural 
     communities. These banks and the communities they serve have 
     vital interests at stake in the economic, banking, and 
     payment system issues that come before the Board. The Board 
     must consider how best to tier regulation to meet regulatory 
     objectives without disproportionately impacting community 
     banks. Expertise is also required to ensure that regulations 
     intended for the largest banks do not unintentionally sweep 
     in community banks. The unexpected compliance problems 
     associated with the December 2013 Volcker Rule vividly 
     illustrate this risk.
       By requiring community bank representation on the Board, 
     Senator Vitter's amendment will help secure the future of the 
     community banking industry and the customers and communities 
     that depend on it. Again, ICBA urges you to vote YES on this 
     important amendment.
       Thank you for your consideration.
           Sincerely,
                                                   Camden R. Fine,
                                                President and CEO.

  Mr. VITTER. Thank you, Mr. President.
  The PRESIDING OFFICER. The Senator from Oklahoma.


                           Amendment No. 3549

  Mr. COBURN. Mr. President, I ask unanimous consent that the pending 
amendment be set aside and my amendment No. 3549 be called up.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The clerk will report.
  The assistant legislative clerk read as follows:
  The Senator from Oklahoma [Mr. Coburn] proposes an amendment numbered 
3549.
  Mr. COBURN. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

(Purpose: To allow the Secretary to extend the deadline for collecting 
 terrorism loss risk-spreading premiums if the mandatory recoupment is 
                        morethan $1,000,000,000)

       On page 4, line 21, strike ``(i)''.
       On page 4, between lines 21 and 22, insert the following:
       (i) in clause (i)--
       On page 4, line 22, strike ``(i)'' and insert ``(I)'' and 
     move such subclause 2 ems to the right.
       On page 4, line 23, strike ``(I)'' and insert ``(aa)''and 
     move such item 2 ems to the right.
       On page 5, line 1, strike ``(II)'' and insert ``(bb)'' and 
     move such item 2 ems to the right.
       On page 5, line 3, strike ``(ii)'' and insert ``(II)'' and 
     move such subclause 2 ems to the right.
       On page 5, line 4, strike ``(I)'' and insert ``(aa)'' and 
     move such item 2 ems to the right.
       On page 5, line 6, strike ``(II)'' and insert ``(bb)'' and 
     move such item 2 ems to the right.
       On page 5, line 8, strike ``(III)'' and insert ``(cc)'' and 
     move such item 2 ems to the right.
       On page 5, line 10, strike ``(iii)'' and insert ``(III)'' 
     and move such subclause 2 ems to the right.
       On page 5, line 11, strike ``(I)'' and insert ``(aa)'' and 
     move such item 2 ems to the right.
       On page 5, line 13, strike ``(II)'' and insert ``(bb)'' and 
     move such item 2 ems to the right.
       On page 5, line 14, strike the period at the end and insert 
     ``; and''.
       On page 5, between lines 14 and 15, insert the following:
       (ii) by adding at the end the following:
       ``(iii) Deadline extensions.--

       ``(I) In general.--If the mandatory recoupment amount under 
     subparagraph (A) is more than $1,000,000,000 in any given 
     calendar year, the Secretary may extend the applicable 
     deadline for collecting terrorism loss risk-spreading 
     premiums under clause (i) for a period not to exceed more 
     than 10 years after the date on which such act of terrorism 
     occurred.
       ``(II) Determination.--Any determination by the Secretary 
     to grant an extension under subclause (I) shall be based on--

       ``(aa) the economic conditions in the commercial 
     marketplace, including the capitalization, profitability, and 
     investment returns of the insurance industry and the current 
     cycle of the insurance markets;
       ``(bb) the affordability of commercial insurance for small- 
     and medium-sized businesses; and
       ``(cc) such other factors as the Secretary considers 
     appropriate.

       ``(III) Report.--If the Secretary grants an extension under 
     subclause (I), the Secretary shall promptly submit to 
     Congress a report--

       ``(aa) justifying the reason for such extension; and
       ``(bb) detailing a plan for the collection of the required 
     terrorism loss risk-spreading premiums.''.

  Mr. COBURN. Mr. President, we have before us a bill where 
unfortunately we do not believe in markets. We are told markets will 
not work, so we have a terrorism risk insurance bill. That means the 
Federal Government is going to be the insurer of last resort. There 
have been some improvements over what we have put forward in the past, 
and I agree with those improvements if in fact we have to do this. I am 
not convinced we have to do it, but we are going to do it, and I 
understand that. I think the work of the committee, of which I am a 
member, has been very good.
  But there is one real problem with this bill, and it is about smoke 
and mirrors, it is about not being honest with the American people. 
This bill was designed so it would have no score. It was not designed 
to do the best we can for America should we have a tragedy, and it was 
not designed to create the flexibility that would be necessary if we do 
have a tragedy.
  Let me outline this for you. The way this bill is set up is that we 
could have a significant tragedy, God forbid, in this country from a 
terrorist attack, and the bill will mandate spikes in casualty and 
property insurance far above what will need to happen because we passed 
the bill to pass a CBO score. So what could happen is we would have to 
collect billions of dollars over an 18-month period through premium 
increases on everybody in the country, not just where we had the 
problem--everybody in the country--because we have designed a bill that 
will in fact mandate that or at least could mandate that.
  I have been around this place for 10 years. I know exactly what is 
going to happen if that comes about through this TRIA bill. The first 
thing that will happen is the Senate and the House will pass an 
elimination of this requirement. So what will happen is the American 
taxpayer will get stuck with all this. They all know that. Everybody 
agrees they designed the bill to meet CBO. So what I put in was an 
amendment that would give flexibility to the Treasury so we do not, 
after one tragedy, create another tragedy with markedly elevated 
casualty and property rates. We still recoup the money, but we do it 
over a longer period of time, if it is necessary, and we give the 
Secretary of the Treasury the ability to do that.
  My friend from New York says there is a budget point of order that 
lies against it. It does according to CBO. I agree, it does. But the 
difference between this and most budget points of order is my amendment 
will not increase the deficit one penny--not one penny.
  I would also note that my colleague from New York has voted to 
override budget points of order every time they have been offered this 
year. So it is going to be curious to me to all of a sudden have a 
budget point of order raised by someone who has voted to override the 
budget point of order every time it has been offered in the Senate this 
session, and it goes to why we should not pass this bill without common 
sense in terms of how we collect the recoupment.
  I understand the constraints of CBO, but I also understand common 
sense. So we are going to play the game on the constraints, and we are 
ultimately going to pass on--rather than recoup--we are ultimately 
going to pass it on to the American taxpayer, which hollows out the 
whole purpose of the bill.
  So this has a billion-dollar score, on which we are going to have a 
point of order, which I am sure I will lose. But when you vote for this 
bill, know you are not voting for what the bill says it is going to do 
because it is going to do something completely different than what it 
says, if we were to have one of these catastrophies.
  The political pressure to not have these massive increases in 
property and casualty insurance--this place will fall, and so will the 
House, and we will change this, and we will have the score then. We 
will have the score then, and ultimately your children will pay for the 
cost of this terrorism risk insurance, not the people who are owning 
the property today, not the insurance company. We will just kick the 
can down the road, just as we have on everything else.
  It would seem to me that we would want to do something that works 
along

[[Page S4586]]

the parameters of this bill, and we ought to build in flexibility to 
this bill so that--it may be 10 years that we get on one of these 
because the bill is divided up to meet the score so it does not score 
in any one period. So over an 18-month period we could have to recoup 
it all and people could not tolerate those kinds of rate increases in 
their businesses or their homes. They would not be able to tolerate it 
and we would change it. Just as I am asking for us to change it now and 
be honest with the American people, we are going to change it if that 
happens.
  We will change this, and we will delay the onset of the collection of 
this recoupment. Everybody knows that will happen. So why not be honest 
about it and put it in the bill now and waive the budget point of order 
because it does not change the deficit one penny. It changes when we 
collect it, but we still collect it against the risk of not collecting 
it at all.
  That is what I ask my colleagues. I do not expect to win the 
amendment, but it is another confirmation to the American people that 
we are not about truth, we are not about doing commonsense things; we 
are about playing games and we are about satisfying the demands of the 
industry over which this applies.
  Nobody knows what could happen in this country in terms of terrorism, 
but everybody knows I am right about this issue.
  All I am saying is: Fess up. Be honest, colleagues. Let's build the 
flexibility in this so we do not have to address it, and the Treasury 
Secretary, no matter whether it is a Democrat or Republican 
administration, can use common sense to guide about how fast this 
recoupment will come; otherwise, you have not done anything to improve 
this bill if, in fact, this is not accepted.
  I will be leaving here at the end of the year. Hopefully, we never 
see another terrorism event in this country. But if we do, it will be a 
sweet irony when you all say: Oops, time out. We are not going to do 
what we said we were going to do in that bill because the country 
cannot take it. What you will do is put one tragic event on top of 
another. You will not do that. So what will happen? You will change 
this bill. You will get that score. You will call it an emergency. You 
will do it anyway.
  All I am asking is, be honest about what is going to ultimately 
happen on this should we have an event and it fall within one of these 
close parameters, based on what we said in the bill, because we are 
running the bill according to what CBO says, not as to what common 
sense is.
  I look forward to having a vote on this amendment. I understand my 
likelihood of being successful. But I also understand the lack of 
honesty in dealing with the American people if we do not accept this 
amendment.
  I yield the floor.


                           Terrorist Attacks

  Mr. REED. Mr. President, I join with my colleagues to speak about S. 
2244, the Terrorism Risk Insurance Program Reauthorization Act of 2014, 
TRIA, which I have cosponsored.
  First, I commend Banking Committee Chairman Johnson and Ranking 
Member Crapo for their leadership on this important issue. Their 
efforts, along with those of the sponsors and cosponsors of the bill, 
led to a unanimous committee vote of 22 to 0 to report the legislation 
favorably to the full Senate. It is heartening to see legislation like 
this come together on such a strong bipartisan basis.
  Reauthorizing TRIA is vital and not just from a Banking Committee 
perspective. I also have the privilege of serving on the Armed Services 
Committee. It is through this dual lens, and from what we know of the 
significant terrorist threats our Nation still faces, that compels me 
to believe that we need to reauthorize TRIA as soon as possible.
  We must keep markets effectively and efficiently operating in light 
of these threats. We must continue to have policies in place to make 
sure our economy stays on track in the event of another attack on our 
Nation.
  In short, reauthorizing TRIA is not only a matter of economic 
security; it is also a matter of national security. And so, I again 
thank the chairman for his leadership on this vital issue.
  Mr. JOHNSON of South Dakota. I thank Senator Reed for his valuable 
contributions to the work of the Banking Committee. I also thank him 
for working with me on this matter and for his continued efforts to 
bolster our national security.
  Mr. REED. I thank the chairman. I would like to clarify one point. 
While TRIA is silent on whether a nuclear, chemical, biological, or 
radiological related terrorist attack or any kind of cyber-related 
attack are covered, I believe our intent with S. 2244 is that these 
attacks would continue to fall within the scope of TRIA's covered 
lines, as they do today, provided that statutory prerequisites are met. 
Does the chairman agree with this assessment?
  Mr. JOHNSON of South Dakota. Yes. The Committee makes this point 
clear in the Committee Report for S. 2244, and I thank the Senator 
again for his work on this issue.
  Mr. REED. I thank the chairman again, and I look forward to swift 
passage of this legislation here in the Senate, and hopefully in the 
House as well.
  Mr. NELSON. Mr. President, today I commend my colleagues for a strong 
bipartisan vote in favor of S. 2244, the Terrorism Risk Insurance 
Program Reauthorization Act.
  After the attacks of September 11, 2001, the Terrorism Risk Insurance 
Act, or TRIA, helped stabilize the commercial property market. This has 
allowed for continued commercial property development and real estate 
lending for office buildings, hotels, malls, and tourist attractions 
across the United States. In Florida, TRIA has been particularly 
important for continued development in the tourism sector--which is a 
critical part of the economy.
  The passage of S. 2244 today illustrates the widespread, continued 
support for TRIA and the need for a backstop to guarantee sufficient 
capacity for businesses to insure against catastrophic terrorist 
events, including coverage for events involving a nuclear, biological, 
chemical or radiological element. At the same time, S. 2244 also 
ensures that taxpayers are a top priority and includes a recoupment 
mechanism to guarantee that taxpayers are made whole if the backstop is 
triggered.
  I now hope that the House of Representatives will take quick action 
on S. 2244 so that the President can sign this legislation and assure 
continued stability in the commercial property and insurance market.
  The PRESIDING OFFICER. The Senator from South Dakota.
  Mr. JOHNSON of South Dakota. Mr. President, I rise today to support 
S. 2244, the Terrorism Risk Insurance Program Reauthorization Act. 
Congress first enacted TRIA into law in 2002 after the commercial 
property sector saw major disruptions in the ability to obtain 
financing and terrorism risk insurance following the September 11 
terrorist attacks.
  TRIA stabilized the markets and provided a government backstop to 
these unique markets, allowing commercial property development and real 
estate lending to continue for everything from hotels, stadiums, malls, 
to tourist attractions across the country. Experts and stakeholders 
testified at several banking committee hearings that there remains a 
clear and longstanding need for the kind of government backstop TRIA 
provides.
  We also learned the private insurance market for terrorism risk 
exists because of TRIA, not in spite of it.
  The long-term 7-year extension this bipartisan bill provides will 
promote national security, economic growth, and market certainty. While 
many Members in this Chamber would be fine with extending TRIA in its 
current form, this tough compromise has two additional changes that 
will further protect taxpayers: gradually raising both the insurer 
copayment from 15 percent to 20 percent, and the mandatory recoupment 
threshold from $27.5 billion to $37.5 billion.
  We were careful, however, in reaching this compromise not to raise 
the trigger, which would drive small insurers out of the market and 
reduce the availability and affordability of coverage for businesses 
nationwide. This bipartisan bill also does not pick what modes of 
terrorist attacks should get preferential treatment over other forms of 
attacks.
  The entire Senate banking committee voted to report the bill to the 
floor by a unanimous and bipartisan 22-to-0 vote. Stakeholders across 
the board strongly support the Senate's bipartisan approach to 
extending TRIA,

[[Page S4587]]

including the U.S. Chamber of Commerce, the American Hotel and Lodging 
Association, the National Association of Mutual Insurance Companies, 
and the Real Estate Roundtable, to name just a few.
  Let me commend Senators Schumer, Crapo, Kirk, Reed, Heller, and 
others from both sides of the aisle for their leadership on this issue. 
I thank them as well as their staffs for working with Ranking Member 
Crapo and me and our staffs to craft this bipartisan compromise to 
extend TRIA for another 7 years. We would not be here today without all 
of their efforts.
  TRIA must be renewed soon, given the program expires at the end of 
the year, and policyholders have increasingly reported challenges in 
renewing contracts for 2015. To that end, I urge my colleagues to 
support S. 2244.
  I yield the floor and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. HELLER. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. HELLER. Mr. President, I rise to speak on S. 2244, the Terrorism 
Risk Insurance Program Reauthorization Act. This is a bill I have 
worked on closely with my colleagues Senators Schumer, Kirk, and Reed 
from Rhode Island. I also want to thank Chairman Johnson and Ranking 
Member Crapo, who have been instrumental in getting this bill to this 
point. Without their leadership, we would not be here today.
  The terrorist attacks on September 11 caused a sudden and dramatic 
shock in the domestic market for terrorism insurance. After the attack 
there was a tremendous amount of uncertainty about the frequency and 
potential size of future attacks. Insurers quickly withdrew from the 
terrorist coverage market, and a new threat to our economy emerged.

  In response, Congress passed TRIA, to provide a Federal insurance 
backstop for terrorism coverage. Since the passage in 2002, TRIA has 
helped ensure the widespread availability of affordable insurance 
against terrorism. This helped spur new development and protected 
existing real estate throughout our country.
  TRIA was reauthorized in 2005 and reauthorized again in 2007. It is 
currently set to expire at the end of this year unless Congress acts. 
Unfortunately, the tragic bombing in Boston last year has shown that 
even years after September 11, the threat of terrorism still exists and 
we must continue our efforts to prevent, respond, and recover from any 
possible attacks in the future.
  I wish to remind my colleagues that terrorism is not only an issue 
for big cities in New Jersey, on the east coast, in the Midwest, 
Chicago, terrorism is a real threat in both rural and urban areas, 
north, south, east, and west. That is why I have been so involved in 
trying to get TRIA extended.
  In my home State, Las Vegas is considered one of the leading 
international business and tourism destination cities in the world. 
Southern Nevada welcomes almost 40 million tourists annually and has a 
population of nearly 2 million people. We have 35 major hotels along 
the Las Vegas strip. Many of them could have up to 15,000 occupants at 
any given time. According to the Las Vegas Metro Chamber of Commerce, 
in 2013, the total economic impact of tourism was $45.2 billion, 
supporting 47 percent of the region's gross product, and 383,000 jobs, 
nearly half of the total workforce in southern Nevada.
  My point in citing these statistics is if a terrorist attack were to 
occur in Las Vegas, our entire State economy would be devastated 
without TRIA.
  It is not just about Las Vegas. In northern Nevada, our tourism and 
gaming industry is the largest private employer in Washoe County, which 
also includes Reno. They know that unless they have access to 
affordable terrorism coverage, they will have difficulty starting new 
capital projects and creating new jobs.
  You will find similar stories across our Nation in every State. 
Currently, there is no evidence that the terrorism risk insurance 
market is prepared to provide coverage without TRIA. Without TRIA, most 
developments would halt because businesses would not be able to access 
and afford the necessary insurance that is often required to secure a 
loan.
  TRIA has helped many hotels, hospitals, office complexes, shopping 
centers, colleges, and universities have access to terrorism insurance 
coverage.
  The bill before us today is truly a bipartisan bill. It received a 
unanimous 22-to-0 vote in the banking committee. Such a strong vote 
only reinforces the bipartisan work that went into crafting this 
legislation.
  I, along with my colleagues on the Banking, Housing, and Urban 
Affairs Committee, agreed to several key reforms that would increase 
the insurance industry's aggregate retention level and coinsurance 
levels, which will significantly reduce the potential cost to 
taxpayers.
  It is my hope that we can easily pass this important legislation with 
a strong bipartisan vote and send this bill to the House as soon as 
possible. I urge my colleagues to support this bill, and let's not wait 
until the end of the year to extend this critical program.
  With that, I yield the floor, and I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CRAPO. I ask unanimous consent that the order for the quorum call 
be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. CRAPO. Mr. President, as we near the votes on this bill, I wish 
to take one more opportunity to speak in favor of the TRIA 
reauthorization legislation.
  Again, I thank Senators Schumer, Heller, and Kirk and their staffs 
and Senator Reed for all their hard work in bringing forward this 
legislation.
  I also thank Chairman Johnson and his staff for moving forward so 
quickly and aggressively on this legislation. Together, we were able to 
put together a bill that allows the program to continue to function 
while increasing the movement toward ultimate taxpayer protection.
  As I mentioned before, we were able to approve this bill out of 
committee with a 22-to-0 unanimous vote. The agreement of all the 
members of the banking committee that we should move this bill forward 
speaks to the importance of this critical legislation and to the level 
of the added taxpayer protections we were able to build into it.
  Our bill increases the level of losses that the private sector will 
absorb before reaching the Federal backstop. We do that by increasing 
the coinsurance level of any company participating in TRIA so that each 
company will shoulder a greater percentage of the losses. We also 
increase by $10 billion the level of mandatory post-event recoupments 
to $37.5 billion, which means that the taxpayer will ultimately recover 
all TRIA losses except in the most extreme events.
  This bill will continue a program that reduces our economic 
vulnerability to terrorism, and I encourage my colleagues to support 
it.
  One last time, I thank Senator Johnson and Senator Schumer for their 
strong support and for our ability to work together and break the mold, 
if you will, by having a bipartisan movement forward on this important 
and critical legislation.
  With that, I yield the floor.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. Once again I thank the chair and the ranking member of 
the banking committee, Tim Johnson and Mike Crapo, for their great 
work.
  I say to my colleagues, this is a very good example of much 
cooperation--bipartisan cooperation, Democrat and Republican--a 22-to-0 
unanimous vote out of the committee. It is also cooperation between 
private industry and the government. Industry, insurance, and others 
knew they had to shoulder a greater share of the load as we move on 
after 9/11 but that only government could be the backstop at the end of 
the day.
  Again, this is an economic development issue above anything else. It 
is not out of whose pocket what money comes. If the greatest problem 
America faces is good-paying jobs--well, if we were not to renew 
terrorism insurance, we would lose many good-paying jobs.
  This amendment will allow those jobs to continue and grow. People 
will

[[Page S4588]]

not build major edifices, major complexes--whether they be skyscrapers 
in Chicago or New York, whether they be football stadiums in Idaho or 
South Carolina or major shopping centers in South Dakota--unless they 
know there is a backstop, because insurers will not insure if they 
think terrorism could just totally wipe them out. And that means we 
wouldn't get financing for these projects.
  It is an outstanding piece of legislation. My hope, in conclusion, is 
that the House would pass our bill. We know there are some concerns in 
the House, but there is a bipartisan coalition of Democrats and 
Republicans who really favor the approach we have taken. I know there 
are some in the House who don't believe government should be involved 
here, but that is, with all due respect, a purist view.
  We have cut back on some of the government's obligations. Mike Crapo 
and many of our colleagues from the other side of the aisle made that 
happen. But at the same time, without the government backstop, we would 
do real harm to our economy.
  I hope we can get a very large vote in the Senate--bipartisan--
because if we do, it should importune the House to perhaps pass our 
legislation.
  I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. SCHUMER. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SCHUMER. Mr. President, I wish to make a couple points on the 
Coburn amendment, and then I will raise a point of order.
  The current bill, S. 2244, is budget neutral, as the past TRIA bills 
have been. On the other hand, CBO has said Senator Coburn's amendment 
is not fully paid for, violating the Senate's PAYGO rule.
  Basically, the amendment--even though I know the sponsor does not 
intend it that way--is a killer amendment. CBO has said the amendment 
would cause S. 2244 to increase the Federal deficit in both the 5-year 
and 10-year budget windows.
  Senator Coburn offered this amendment in committee. It was roundly 
defeated by a bipartisan vote of 16 to 6 against it.
  I appreciate Senator Coburn's effort to provide more flexibility to 
the timeframe for recoupment by the government in case of a terrorist 
attack, but in fact the banking committee, led by Senator Johnson, and 
my office have worked with CBO for a number of months to determine 
whether there could be more flexibility in the recoupment process. 
Unfortunately, CBO has yet to identify a way to provide more 
flexibility in the recoupment period while still ensuring the program 
remains budget neutral as it is now.
  It is also important to note that if recoupment by the government 
poses any unforeseen challenge after a future attack, nothing would 
stop the Treasury Secretary from asking the Congress then to provide 
that flexibility.
  The bottom line is that TRIA is too important to allow this amendment 
and nonreauthorization of the program because it is not budget neutral. 
We don't want to give anybody an excuse.
  I am hopeful Senator Coburn will support TRIA's final passage, even 
if his amendment isn't agreed to, as he did in committee. But for those 
of us whose priority is to reauthorize this program, I urge my 
colleagues to vote to sustain the budget point of order and oppose the 
amendment.
  Mr. President, I raise a point of order that the pending amendment 
violates section 201 of S. Con. Res. 21, the concurrent resolution on 
the budget for the fiscal year 2008.
  The PRESIDING OFFICER. The Senator from Iowa.
  Mr. CRAPO. Mr. President, pursuant to section 904 of the 
Congressional Budget Act of 1974 and the waiver provisions of 
applicable budget resolutions, I move to waive all applicable sections 
of that act and applicable budget resolutions for purposes of the 
pending amendment, and I ask for the yeas and nays.
  The PRESIDING OFFICER (Mr. King). Is there a sufficient second?
  There appears to be a sufficient second.
  All debate time is expired.
  The question is on agreeing to the motion.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Coons) and 
the Senator from Hawaii (Mr. Schatz) are necessarily absent.
  Mr. CORNYN. The following Senator is necessarily absent: the Senator 
from Tennessee (Mr. Alexander).
  Further, if present and voting, the Senator from Tennessee (Mr. 
Alexander) would have voted ``yea.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The yeas and nays resulted--yeas 48, nays 49, as follows:

                      [Rollcall Vote No. 229 Leg.]

                                YEAS--48

     Ayotte
     Barrasso
     Blunt
     Boozman
     Burr
     Chambliss
     Coats
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     Cruz
     Enzi
     Fischer
     Flake
     Graham
     Grassley
     Hatch
     Heller
     Hoeven
     Inhofe
     Isakson
     Johanns
     Johnson (WI)
     Kirk
     Lee
     Manchin
     McCain
     McConnell
     Moran
     Murkowski
     Paul
     Portman
     Risch
     Roberts
     Rubio
     Scott
     Sessions
     Shaheen
     Shelby
     Thune
     Toomey
     Udall (CO)
     Vitter
     Warner
     Wicker

                                NAYS--49

     Baldwin
     Begich
     Bennet
     Blumenthal
     Booker
     Boxer
     Brown
     Cantwell
     Cardin
     Carper
     Casey
     Donnelly
     Durbin
     Feinstein
     Franken
     Gillibrand
     Hagan
     Harkin
     Heinrich
     Heitkamp
     Hirono
     Johnson (SD)
     Kaine
     King
     Klobuchar
     Landrieu
     Leahy
     Levin
     Markey
     McCaskill
     Menendez
     Merkley
     Mikulski
     Murphy
     Murray
     Nelson
     Pryor
     Reed
     Reid
     Rockefeller
     Sanders
     Schumer
     Stabenow
     Tester
     Udall (NM)
     Walsh
     Warren
     Whitehouse
     Wyden

                             NOT VOTING--3

     Alexander
     Coons
     Schatz
  The PRESIDING OFFICER. On this vote, the yeas are 48 and the nays are 
49. Three-fifths of the Senators duly chosen and sworn not having voted 
in the affirmative, the motion is rejected and the amendment falls.


                             Change of Vote

  Mr. WARNER. Mr. President, on rollcall vote No. 229, I was present 
and voted aye. The official record has me listed as absent. Therefore, 
I ask unanimous consent that the official record be corrected to 
accurately reflect my vote. This will in no way change the outcome of 
the vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (The foregoing tally has been changed to reflect the above order.)


                       Vote on Amendment No. 3550

  The PRESIDING OFFICER. Under the previous order, there will be 2 
minutes of debate prior to a vote in relation to Vitter amendment No. 
3550.
  Mr. SCHUMER. Mr. President, I yield back all time.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. SCHUMER. I ask for a voice vote.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 3550) was agreed to.
  The PRESIDING OFFICER. Under the previous order, there will be 2 
minutes of debate prior to a vote in relation to Flake amendment No. 
3551.
  The PRESIDING OFFICER. The Senator from New York.
  Mr. SCHUMER. This is a good amendment and will be supported by 
Chairman Johnson and myself.
  I yield back all time.
  Mr. McCAIN. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There appears to be a sufficient second.
  The question is on agreeing to the amendment.
  The clerk will call the roll.
  The assistant bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Coons) and 
the Senator from Hawaii (Mr. Schatz) are necessarily absent.
  Mr. CORNYN. The following Senator is necessarily absent: the Senator 
from Tennessee (Mr. Alexander).

[[Page S4589]]

  Further, if present and voting, the Senator from Tennessee (Mr. 
Alexander) would have voted ``yea.''
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 97, nays 0, as follows:

                      [Rollcall Vote No. 230 Leg.]

                                YEAS--97

     Ayotte
     Baldwin
     Barrasso
     Begich
     Bennet
     Blumenthal
     Blunt
     Booker
     Boozman
     Boxer
     Brown
     Burr
     Cantwell
     Cardin
     Carper
     Casey
     Chambliss
     Coats
     Coburn
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     Cruz
     Donnelly
     Durbin
     Enzi
     Feinstein
     Fischer
     Flake
     Franken
     Gillibrand
     Graham
     Grassley
     Hagan
     Harkin
     Hatch
     Heinrich
     Heitkamp
     Heller
     Hirono
     Hoeven
     Inhofe
     Isakson
     Johanns
     Johnson (SD)
     Johnson (WI)
     Kaine
     King
     Kirk
     Klobuchar
     Landrieu
     Leahy
     Lee
     Levin
     Manchin
     Markey
     McCain
     McCaskill
     McConnell
     Menendez
     Merkley
     Mikulski
     Moran
     Murkowski
     Murphy
     Murray
     Nelson
     Paul
     Portman
     Pryor
     Reed
     Reid
     Risch
     Roberts
     Rockefeller
     Rubio
     Sanders
     Schumer
     Scott
     Sessions
     Shaheen
     Shelby
     Stabenow
     Tester
     Thune
     Toomey
     Udall (CO)
     Udall (NM)
     Vitter
     Walsh
     Warner
     Warren
     Whitehouse
     Wicker
     Wyden

                             NOT VOTING--3

     Alexander
     Coons
     Schatz
  The amendment (No. 3551) was agreed to.


                       Vote on Amendment No. 3552

  The PRESIDING OFFICER. Under the previous order, there will be 2 
minutes of debate prior to a vote in relation to the Tester amendment 
No. 3552.
  The Senator from New York.
  Mr. SCHUMER. I yield back all time.
  The PRESIDING OFFICER. All time is yielded back.
  The question is on agreeing to Tester amendment No. 3552.
  The amendment was agreed to.
  The bill was ordered to be engrossed for a third reading and was read 
the third time.
  The PRESIDING OFFICER. Under the previous order, there will be 2 
minutes of debate equally divided prior to a vote on the passage of the 
bill.
  Mr. SCHUMER. Mr. President, I yield back all time and ask for the 
yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  Thre is a sufficient second.
  The bill having been read the third time, the question is, Shall it 
pass?
  The clerk will call the roll.
  The legislative clerk called the roll.
  The PRESIDING OFFICER (Ms. Hirono). Are there any other Senators in 
the Chamber desiring to vote?
  Mr. DURBIN. I announce that the Senator from Delaware (Mr. Coons) and 
the Senator from Hawaii (Mr. Schatz) are necessarily absent.
  Mr. CORNYN. The following Senator is necessarily absent: the Senator 
from Tennessee (Mr. Alexander).
  Further, if present and voting, the Senator from Tennessee (Mr. 
Alexander) would have voted ``yea.''
  The result was announced--yeas 93, nays 4, as follows:

                      [Rollcall Vote No. 231 Leg.]

                                YEAS--93

     Ayotte
     Baldwin
     Barrasso
     Begich
     Bennet
     Blumenthal
     Blunt
     Booker
     Boozman
     Boxer
     Brown
     Burr
     Cantwell
     Cardin
     Carper
     Casey
     Chambliss
     Coats
     Cochran
     Collins
     Corker
     Cornyn
     Crapo
     Cruz
     Donnelly
     Durbin
     Enzi
     Feinstein
     Fischer
     Flake
     Franken
     Gillibrand
     Graham
     Grassley
     Hagan
     Harkin
     Hatch
     Heinrich
     Heitkamp
     Heller
     Hirono
     Hoeven
     Inhofe
     Isakson
     Johanns
     Johnson (SD)
     Johnson (WI)
     Kaine
     King
     Kirk
     Klobuchar
     Landrieu
     Leahy
     Lee
     Levin
     Manchin
     Markey
     McCain
     McCaskill
     McConnell
     Menendez
     Merkley
     Mikulski
     Moran
     Murkowski
     Murphy
     Murray
     Nelson
     Paul
     Portman
     Pryor
     Reed
     Reid
     Risch
     Rockefeller
     Sanders
     Schumer
     Scott
     Shaheen
     Shelby
     Stabenow
     Tester
     Thune
     Toomey
     Udall (CO)
     Udall (NM)
     Vitter
     Walsh
     Warner
     Warren
     Whitehouse
     Wicker
     Wyden

                                NAYS--4

     Coburn
     Roberts
     Rubio
     Sessions

                             NOT VOTING--3

     Alexander
     Coons
     Schatz
  The bill (S. 2244), as amended, was passed, as follows:

                                S. 2244

       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 ``Terrorism Risk Insurance 
     Program Reauthorization Act of 2014''.

     SEC. 2. EXTENSION OF TERRORISM INSURANCE PROGRAM.

       Section 108(a) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended by striking ``December 31, 
     2014'' and inserting ``December 31, 2021''.

     SEC. 3. FEDERAL SHARE.

       Section 103(e)(1)(A) of the Terrorism Risk Insurance Act of 
     2002 (15 U.S.C. 6701 note) is amended by inserting ``and 
     beginning on January 1, 2016, shall decrease by 1 percentage 
     point per calendar year until equal to 80 percent'' after 
     ``85 percent''.

     SEC. 4. RECOUPMENT OF FEDERAL SHARE OF COMPENSATION UNDER THE 
                   PROGRAM.

       Section 103(e) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note) is amended--
       (1) in paragraph (6), in the matter preceding subparagraph 
     (A), by striking ``shall be'' and all that follows through 
     subparagraph (E) and inserting ``shall be the lesser of--
       ``(A) $27,500,000,000, as such amount is adjusted pursuant 
     to this paragraph; and
       ``(B) the aggregate amount, for all insurers, of insured 
     losses during such calendar year,
     provided that beginning in the calendar year that follows the 
     date of enactment of the Terrorism Risk Insurance Program 
     Reauthorization Act of 2014, the amount set forth under 
     subparagraph (A) shall increase by $2,000,000,000 per 
     calendar year until equal to $37,500,000,000.'';
       (2) in paragraph (7)--
       (A) in subparagraph (A)--
       (i) in the matter preceding clause (i), by striking ``for 
     each of the periods referred to in subparagraphs (A) through 
     (E) of paragraph (6)''; and
       (ii) in clause (i), by striking ``for such period'';
       (B) by striking subparagraph (B) and inserting the 
     following:
       ``(B) [Reserved.]'';
       (C) in subparagraph (C)--
       (i) by striking ``occurring during any of the periods 
     referred to in any of subparagraphs (A) through (E) of 
     paragraph (6), terrorism loss risk-spreading premiums in an 
     amount equal to 133 percent'' and inserting ``, terrorism 
     loss risk-spreading premiums in an amount equal to 135.5 
     percent''; and
       (ii) by inserting ``as calculated under subparagraph (A)'' 
     after ``mandatory recoupment amount''; and
       (D) in subparagraph (E)(i)--
       (i) in subclause (I)--

       (I) by striking ``2010'' and inserting ``2017''; and
       (II) by striking ``2012'' and inserting ``2019'';

       (ii) in subclause (II)--

       (I) by striking ``2011'' and inserting ``2018'';
       (II) by striking ``2012'' and inserting ``2019''; and
       (III) by striking ``2017'' and inserting ``2024''; and

       (iii) in subclause (III)--

       (I) by striking ``2012'' and inserting ``2019''; and
       (II) by striking ``2017'' and inserting ``2024''.

     SEC. 5. TECHNICAL AMENDMENTS.

       The Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) is amended--
       (1) in section 102--
       (A) in paragraph (3)--
       (i) by redesignating subparagraphs (A), (B), and (C) as 
     clauses (i), (ii), and (iii), respectively;
       (ii) in the matter preceding clause (i) (as so 
     redesignated), by striking ``An entity has'' and inserting 
     the following:
       ``(A) In general.--An entity has''; and
       (iii) by adding at the end the following new subparagraph:
       ``(B) Rule of construction.--An entity, including any 
     affiliate thereof, does not have `control' over another 
     entity, if, as of the date of enactment of the Terrorism Risk 
     Insurance Program Reauthorization Act of 2014, the entity is 
     acting as an attorney-in-fact, as defined by the Secretary, 
     for the other entity and such other entity is a reciprocal 
     insurer, provided that the entity is not, for reasons other 
     than the attorney-in-fact relationship, defined as having 
     `control' under subparagraph (A).'';
       (B) in paragraph (7)--
       (i) by striking subparagraphs (A) through (F) and inserting 
     the following:
       ``(A) the value of an insurer's direct earned premiums 
     during the immediately preceding calendar year, multiplied by 
     20 percent; and'';
       (ii) by redesignating subparagraph (G) as subparagraph (B); 
     and
       (iii) in subparagraph (B), as so redesignated by clause 
     (ii)--

       (I) by striking ``notwithstanding subparagraphs (A) through 
     (F), for the Transition Period or any Program Year'' and 
     inserting ``notwithstanding subparagraph (A), for any 
     calendar year''; and
       (II) by striking ``Period or Program Year'' and inserting 
     ``calendar year'';

       (C) by striking paragraph (11); and
       (D) by redesignating paragraphs (12) through (16) as 
     paragraphs (11) through (15), respectively; and

[[Page S4590]]

       (2) in section 103--
       (A) in subsection (c), by striking ``Program Year'' and 
     inserting ``calendar year'';
       (B) in subsection (e)--
       (i) in paragraph (1)--

       (I) in subparagraph (A), as previously amended by section 
     3--

       (aa) by striking ``the Transition Period and each Program 
     Year through Program Year 4 shall be equal to 90 percent, and 
     during Program Year 5 and each Program Year thereafter'' and 
     inserting ``each calendar year'';
       (bb) by striking the comma after ``80 percent''; and
       (cc) by striking ``such Transition Period or such Program 
     Year'' and inserting ``such calendar year''; and

       (II) in subparagraph (B), by striking ``exceed'' and all 
     that follows through clause (ii) and inserting ``exceed 
     $100,000,000 with respect to such insured losses occurring in 
     the calendar year.'';

       (ii) in paragraph (2)(A), by striking ``the period 
     beginning on the first day of the Transition Period and 
     ending on the last day of Program Year 1, or during any 
     Program Year thereafter'' and inserting ``a calendar year''; 
     and
       (iii) in paragraph (3), by striking ``the period beginning 
     on the first day of the Transition Period and ending on the 
     last day of Program Year 1, or during any other Program 
     Year'' and inserting ``any calendar year''; and
       (C) in subsection (g)(2)--
       (i) by striking ``the Transition Period or a Program Year'' 
     each place that term appears and inserting ``the calendar 
     year'';
       (ii) by striking ``such period'' and inserting ``the 
     calendar year''; and
       (iii) by striking ``that period'' and inserting ``the 
     calendar year''.

     SEC. 6. IMPROVING THE CERTIFICATION PROCESS.

       (a) Definitions.--As used in this section--
       (1) the term ``act of terrorism'' has the same meaning as 
     in section 102(1) of the Terrorism Risk Insurance Act of 2002 
     (15 U.S.C. 6701 note);
       (2) the term ``certification process'' means the process by 
     which the Secretary determines whether to certify an act as 
     an act of terrorism under section 102(1) of the Terrorism 
     Risk Insurance Act of 2002 (15 U.S.C. 6701 note); and
       (3) the term ``Secretary'' means the Secretary of the 
     Treasury.
       (b) Study.--Not later than 9 months after the date of 
     enactment of this Act, the Secretary shall conduct and 
     complete a study on the certification process.
       (c) Required Content.--The study required under subsection 
     (a) shall include an examination and analysis of--
       (1) the establishment of a reasonable timeline by which the 
     Secretary must make an accurate determination on whether to 
     certify an act as an act of terrorism;
       (2) the impact that the length of any timeline proposed to 
     be established under paragraph (1) may have on the insurance 
     industry, policyholders, consumers, and taxpayers as a whole;
       (3) the factors the Secretary would evaluate and monitor 
     during the certification process, including the ability of 
     the Secretary to obtain the required information regarding 
     the amount of projected and incurred losses resulting from an 
     act which the Secretary would need in determining whether to 
     certify the act as an act of terrorism;
       (4) the appropriateness, efficiency, and effectiveness of 
     the consultation process required under section 102(1)(A) of 
     the Terrorism Risk Insurance Act of 2002 (15 U.S.C. 6701 
     note) and any recommendations on changes to the consultation 
     process; and
       (5) the ability of the Secretary to provide guidance and 
     updates to the public regarding any act that may reasonably 
     be certified as an act of terrorism.
       (d) Report.--Upon completion of the study required under 
     subsection (a), the Secretary shall submit a report on the 
     results of such study to the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (e) Rulemaking.--Section 102(1) of the Terrorism Risk 
     Insurance Act of 2002 (15 U.S.C. 6701 note) is amended--
       (1) by redesignating subparagraph (D) as subparagraph (E); 
     and
       (2) by inserting after subparagraph (C) the following:
       ``(D) Timing of certification.--Not later than 9 months 
     after the report required under section 6 of the Terrorism 
     Risk Insurance Program Reauthorization Act of 2014 is 
     submitted to the appropriate committees of Congress, the 
     Secretary shall issue final rules governing the certification 
     process, including any timeline applicable to any 
     certification by the Secretary on whether an act is an act of 
     terrorism under this paragraph.''.

     SEC. 7. GAO STUDY ON UPFRONT PREMIUMS.

       (a) Study.--Not later than 2 years after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall complete a study on the viability and effects of 
     the Federal Government assessing and collecting upfront 
     premiums on insurers that participate in the Terrorism 
     Insurance Program established under the Terrorism Risk 
     Insurance Act of 2002 (15 U.S.C. 6701 note) (hereafter in 
     this section referred to as the ``Program'').
       (b) Required Content.--The study required under subsection 
     (a) shall examine, but shall not be limited to, the following 
     issues:
       (1) How the Federal Government could determine the price of 
     such upfront premiums on insurers that participate in the 
     Program.
       (2) How the Federal Government could collect and manage 
     such upfront premiums.
       (3) How the Federal Government could ensure that such 
     upfront premiums are not spent for purposes other than claims 
     through the Program.
       (4) How the assessment and collection of such upfront 
     premiums could affect take-up rates for terrorism risk 
     coverage in different regions and industries and how it could 
     impact small businesses and consumers in both metropolitan 
     and non-metropolitan areas.
       (5) The effect of collecting such upfront premiums on 
     insurers both large and small.
       (6) The effect of collecting such upfront premiums on the 
     private market for terrorism risk reinsurance.
       (7) The size of any Federal Government subsidy insurers may 
     receive through their participation in the Program, taking 
     into account the Program's current post-event recoupment 
     structure.
       (c) Report.--Upon completion of the study required under 
     subsection (a), the Comptroller General shall submit a report 
     on the results of such study to the Committee on Banking, 
     Housing, and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
       (d) Public Availability.--The study and report required 
     under this section shall be made available to the public in 
     electronic form and shall be published on the website of the 
     Government Accountability Office.

     SEC. 8. MEMBERSHIP OF BOARD OF GOVERNORS OF THE FEDERAL 
                   RESERVE SYSTEM.

       (a) In General.--The first undesignated paragraph of 
     section 10 of the Federal Reserve Act (12 U.S.C. 241) is 
     amended by inserting after the second sentence the following: 
     ``In selecting members of the Board, the President shall 
     appoint at least 1 member with demonstrated primary 
     experience working in or supervising community banks having 
     less than $10,000,000,000 in total assets.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of enactment of this Act and 
     apply to appointments made on and after that effective date, 
     excluding any nomination pending in the Senate on that date.

     SEC. 9. ADVISORY COMMITTEE ON RISK-SHARING MECHANISMS.

       (a) Finding; Rule of Construction.--
       (1) Finding.--Congress finds that it is desirable to 
     encourage the growth of nongovernmental, private market 
     reinsurance capacity for protection against losses arising 
     from acts of terrorism.
       (2) Rule of construction.--Nothing in this Act, any 
     amendment made by this Act, or the Terrorism Risk Insurance 
     Act of 2002 (15 U.S.C. 6701 note) shall prohibit insurers 
     from developing risk-sharing mechanisms to voluntarily 
     reinsure terrorism losses between and among themselves.
       (b) Advisory Committee on Risk-Sharing Mechanisms.--
       (1) Establishment.--The Secretary of the Treasury shall 
     establish and appoint an advisory committee to be known as 
     the ``Advisory Committee on Risk-Sharing Mechanisms'' 
     (referred to in this subsection as the ``Advisory 
     Committee'').
       (2) Duties.--The Advisory Committee shall provide advice, 
     recommendations, and encouragement with respect to the 
     creation and development of the nongovernmental risk-sharing 
     mechanisms described under subsection (a).
       (3) Membership.--The Advisory Committee shall be composed 
     of 9 members who are directors, officers, or other employees 
     of insurers, reinsurers, or capital market participants that 
     are participating or that desire to participate in the 
     nongovernmental risk-sharing mechanisms described under 
     subsection (a), and who are representative of the affected 
     sectors of the insurance industry, including commercial 
     property insurance, commercial casualty insurance, 
     reinsurance, and alternative risk transfer industries.
       (c) Effective Date.--The provisions of this section shall 
     take effect on January 1, 2015.

    TITLE II--NATIONAL ASSOCIATION OF REGISTERED AGENTS AND BROKERS

     SEC. 201. SHORT TITLE.

       This title may be cited as the ``National Association of 
     Registered Agents and Brokers Reform Act of 2014''.

     SEC. 202. REESTABLISHMENT OF THE NATIONAL ASSOCIATION OF 
                   REGISTERED AGENTS AND BROKERS.

       (a) In General.--Subtitle C of title III of the Gramm-
     Leach-Bliley Act (15 U.S.C. 6751 et seq.) is amended to read 
     as follows:

  ``Subtitle C--National Association of Registered Agents and Brokers

     ``SEC. 321. NATIONAL ASSOCIATION OF REGISTERED AGENTS AND 
                   BROKERS.

       ``(a) Establishment.--There is established the National 
     Association of Registered Agents and Brokers (referred to in 
     this subtitle as the `Association').
       ``(b) Status.--The Association shall--
       ``(1) be a nonprofit corporation;
       ``(2) not be an agent or instrumentality of the Federal 
     Government;
       ``(3) be an independent organization that may not be merged 
     with or into any other private or public entity; and
       ``(4) except as otherwise provided in this subtitle, be 
     subject to, and have all the powers conferred upon, a 
     nonprofit corporation

[[Page S4591]]

     by the District of Columbia Nonprofit Corporation Act (D.C. 
     Code, sec. 29-301.01 et seq.) or any successor thereto.

     ``SEC. 322. PURPOSE.

       ``The purpose of the Association shall be to provide a 
     mechanism through which licensing, continuing education, and 
     other nonresident insurance producer qualification 
     requirements and conditions may be adopted and applied on a 
     multi-state basis without affecting the laws, rules, and 
     regulations, and preserving the rights of a State, pertaining 
     to--
       ``(1) licensing, continuing education, and other 
     qualification requirements of insurance producers that are 
     not members of the Association;
       ``(2) resident or nonresident insurance producer 
     appointment requirements;
       ``(3) supervising and disciplining resident and nonresident 
     insurance producers;
       ``(4) establishing licensing fees for resident and 
     nonresident insurance producers so that there is no loss of 
     insurance producer licensing revenue to the State; and
       ``(5) prescribing and enforcing laws and regulations 
     regulating the conduct of resident and nonresident insurance 
     producers.

     ``SEC. 323. MEMBERSHIP.

       ``(a) Eligibility.--
       ``(1) In general.--Any insurance producer licensed in its 
     home State shall, subject to paragraphs (2) and (4), be 
     eligible to become a member of the Association.
       ``(2) Ineligibility for suspension or revocation of 
     license.--Subject to paragraph (3), an insurance producer is 
     not eligible to become a member of the Association if a State 
     insurance regulator has suspended or revoked the insurance 
     license of the insurance producer in that State.
       ``(3) Resumption of eligibility.--Paragraph (2) shall cease 
     to apply to any insurance producer if--
       ``(A) the State insurance regulator reissues or renews the 
     license of the insurance producer in the State in which the 
     license was suspended or revoked, or otherwise terminates or 
     vacates the suspension or revocation; or
       ``(B) the suspension or revocation expires or is 
     subsequently overturned by a court of competent jurisdiction.
       ``(4) Criminal history record check required.--
       ``(A) In general.--An insurance producer who is an 
     individual shall not be eligible to become a member of the 
     Association unless the insurance producer has undergone a 
     criminal history record check that complies with regulations 
     prescribed by the Attorney General of the United States under 
     subparagraph (K).
       ``(B) Criminal history record check requested by home 
     state.--An insurance producer who is licensed in a State and 
     who has undergone a criminal history record check during the 
     2-year period preceding the date of submission of an 
     application to become a member of the Association, in 
     compliance with a requirement to undergo such criminal 
     history record check as a condition for such licensure in the 
     State, shall be deemed to have undergone a criminal history 
     record check for purposes of subparagraph (A).
       ``(C) Criminal history record check requested by 
     association.--
       ``(i) In general.--The Association shall, upon request by 
     an insurance producer licensed in a State, submit 
     fingerprints or other identification information obtained 
     from the insurance producer, and a request for a criminal 
     history record check of the insurance producer, to the 
     Federal Bureau of Investigation.
       ``(ii) Procedures.--The board of directors of the 
     Association (referred to in this subtitle as the `Board') 
     shall prescribe procedures for obtaining and utilizing 
     fingerprints or other identification information and criminal 
     history record information, including the establishment of 
     reasonable fees to defray the expenses of the Association in 
     connection with the performance of a criminal history record 
     check and appropriate safeguards for maintaining 
     confidentiality and security of the information. Any fees 
     charged pursuant to this clause shall be separate and 
     distinct from those charged by the Attorney General pursuant 
     to subparagraph (I).
       ``(D) Form of request.--A submission under subparagraph 
     (C)(i) shall include such fingerprints or other 
     identification information as is required by the Attorney 
     General concerning the person about whom the criminal history 
     record check is requested, and a statement signed by the 
     person authorizing the Attorney General to provide the 
     information to the Association and for the Association to 
     receive the information.
       ``(E) Provision of information by attorney general.--Upon 
     receiving a submission under subparagraph (C)(i) from the 
     Association, the Attorney General shall search all criminal 
     history records of the Federal Bureau of Investigation, 
     including records of the Criminal Justice Information 
     Services Division of the Federal Bureau of Investigation, 
     that the Attorney General determines appropriate for criminal 
     history records corresponding to the fingerprints or other 
     identification information provided under subparagraph (D) 
     and provide all criminal history record information included 
     in the request to the Association.
       ``(F) Limitation on permissible uses of information.--Any 
     information provided to the Association under subparagraph 
     (E) may only--
       ``(i) be used for purposes of determining compliance with 
     membership criteria established by the Association;
       ``(ii) be disclosed to State insurance regulators, or 
     Federal or State law enforcement agencies, in conformance 
     with applicable law; or
       ``(iii) be disclosed, upon request, to the insurance 
     producer to whom the criminal history record information 
     relates.
       ``(G) Penalty for improper use or disclosure.--Whoever 
     knowingly uses any information provided under subparagraph 
     (E) for a purpose not authorized in subparagraph (F), or 
     discloses any such information to anyone not authorized to 
     receive it, shall be fined not more than $50,000 per 
     violation as determined by a court of competent jurisdiction.
       ``(H) Reliance on information.--Neither the Association nor 
     any of its Board members, officers, or employees shall be 
     liable in any action for using information provided under 
     subparagraph (E) as permitted under subparagraph (F) in good 
     faith and in reasonable reliance on its accuracy.
       ``(I) Fees.--The Attorney General may charge a reasonable 
     fee for conducting the search and providing the information 
     under subparagraph (E), and any such fee shall be collected 
     and remitted by the Association to the Attorney General.
       ``(J) Rule of construction.--Nothing in this paragraph 
     shall be construed as--
       ``(i) requiring a State insurance regulator to perform 
     criminal history record checks under this section; or
       ``(ii) limiting any other authority that allows access to 
     criminal history records.
       ``(K) Regulations.--The Attorney General shall prescribe 
     regulations to carry out this paragraph, which shall 
     include--
       ``(i) appropriate protections for ensuring the 
     confidentiality of information provided under subparagraph 
     (E); and
       ``(ii) procedures providing a reasonable opportunity for an 
     insurance producer to contest the accuracy of information 
     regarding the insurance producer provided under subparagraph 
     (E).
       ``(L) Ineligibility for membership.--
       ``(i) In general.--The Association may, under reasonably 
     consistently applied standards, deny membership to an 
     insurance producer on the basis of criminal history record 
     information provided under subparagraph (E), or where the 
     insurance producer has been subject to disciplinary action, 
     as described in paragraph (2).
       ``(ii) Rights of applicants denied membership.--The 
     Association shall notify any insurance producer who is denied 
     membership on the basis of criminal history record 
     information provided under subparagraph (E) of the right of 
     the insurance producer to--

       ``(I) obtain a copy of all criminal history record 
     information provided to the Association under subparagraph 
     (E) with respect to the insurance producer; and
       ``(II) challenge the denial of membership based on the 
     accuracy and completeness of the information.

       ``(M) Definition.--For purposes of this paragraph, the term 
     `criminal history record check' means a national background 
     check of criminal history records of the Federal Bureau of 
     Investigation.
       ``(b) Authority To Establish Membership Criteria.--The 
     Association may establish membership criteria that bear a 
     reasonable relationship to the purposes for which the 
     Association was established.
       ``(c) Establishment of Classes and Categories of 
     Membership.--
       ``(1) Classes of membership.--The Association may establish 
     separate classes of membership, with separate criteria, if 
     the Association reasonably determines that performance of 
     different duties requires different levels of education, 
     training, experience, or other qualifications.
       ``(2) Business entities.--The Association shall establish a 
     class of membership and membership criteria for business 
     entities. A business entity that applies for membership shall 
     be required to designate an individual Association member 
     responsible for the compliance of the business entity with 
     Association standards and the insurance laws, rules, and 
     regulations of any State in which the business entity seeks 
     to do business on the basis of Association membership.
       ``(3) Categories.--
       ``(A) Separate categories for insurance producers 
     permitted.--The Association may establish separate categories 
     of membership for insurance producers and for other persons 
     or entities within each class, based on the types of 
     licensing categories that exist under State laws.
       ``(B) Separate treatment for depository institutions 
     prohibited.--No special categories of membership, and no 
     distinct membership criteria, shall be established for 
     members that are depository institutions or for employees, 
     agents, or affiliates of depository institutions.
       ``(d) Membership Criteria.--
       ``(1) In general.--The Association may establish criteria 
     for membership which shall include standards for personal 
     qualifications, education, training, and experience. The 
     Association shall not establish criteria that unfairly limit 
     the ability of a small insurance producer to become a member 
     of the Association, including imposing discriminatory 
     membership fees.
       ``(2) Qualifications.--In establishing criteria under 
     paragraph (1), the Association shall not adopt any 
     qualification less protective to the public than that 
     contained in the National Association of Insurance 
     Commissioners (referred to in this subtitle as the

[[Page S4592]]

     `NAIC') Producer Licensing Model Act in effect as of the date 
     of enactment of the National Association of Registered Agents 
     and Brokers Reform Act of 2014, and shall consider the 
     highest levels of insurance producer qualifications 
     established under the licensing laws of the States.
       ``(3) Assistance from states.--
       ``(A) In general.--The Association may request a State to 
     provide assistance in investigating and evaluating the 
     eligibility of a prospective member for membership in the 
     Association.
       ``(B) Authorization of information sharing.--A submission 
     under subsection (a)(4)(C)(i) made by an insurance producer 
     licensed in a State shall include a statement signed by the 
     person about whom the assistance is requested authorizing--
       ``(i) the State to share information with the Association; 
     and
       ``(ii) the Association to receive the information.
       ``(C) Rule of construction.--Subparagraph (A) shall not be 
     construed as requiring or authorizing any State to adopt new 
     or additional requirements concerning the licensing or 
     evaluation of insurance producers.
       ``(4) Denial of membership.--The Association may, based on 
     reasonably consistently applied standards, deny membership to 
     any State-licensed insurance producer for failure to meet the 
     membership criteria established by the Association.
       ``(e) Effect of Membership.--
       ``(1) Authority of association members.--Membership in the 
     Association shall--
       ``(A) authorize an insurance producer to sell, solicit, or 
     negotiate insurance in any State for which the member pays 
     the licensing fee set by the State for any line or lines of 
     insurance specified in the home State license of the 
     insurance producer, and exercise all such incidental powers 
     as shall be necessary to carry out such activities, including 
     claims adjustments and settlement to the extent permissible 
     under the laws of the State, risk management, employee 
     benefits advice, retirement planning, and any other 
     insurance-related consulting activities;
       ``(B) be the equivalent of a nonresident insurance producer 
     license for purposes of authorizing the insurance producer to 
     engage in the activities described in subparagraph (A) in any 
     State where the member pays the licensing fee; and
       ``(C) be the equivalent of a nonresident insurance producer 
     license for the purpose of subjecting an insurance producer 
     to all laws, regulations, provisions or other action of any 
     State concerning revocation, suspension, or other enforcement 
     action related to the ability of a member to engage in any 
     activity within the scope of authority granted under this 
     subsection and to all State laws, regulations, provisions, 
     and actions preserved under paragraph (5).
       ``(2) Violent crime control and law enforcement act of 
     1994.--Nothing in this subtitle shall be construed to alter, 
     modify, or supercede any requirement established by section 
     1033 of title 18, United States Code.
       ``(3) Agent for remitting fees.--The Association shall act 
     as an agent for any member for purposes of remitting 
     licensing fees to any State pursuant to paragraph (1).
       ``(4) Notification of action.--
       ``(A) In general.--The Association shall notify the States 
     (including State insurance regulators) and the NAIC when an 
     insurance producer has satisfied the membership criteria of 
     this section. The States (including State insurance 
     regulators) shall have 10 business days after the date of the 
     notification in order to provide the Association with 
     evidence that the insurance producer does not satisfy the 
     criteria for membership in the Association.
       ``(B) Ongoing disclosures required.--On an ongoing basis, 
     the Association shall disclose to the States (including State 
     insurance regulators) and the NAIC a list of the States in 
     which each member is authorized to operate. The Association 
     shall immediately notify the States (including State 
     insurance regulators) and the NAIC when a member is newly 
     authorized to operate in one or more States, or is no longer 
     authorized to operate in one or more States on the basis of 
     Association membership.
       ``(5) Preservation of consumer protection and market 
     conduct regulation.--
       ``(A) In general.--No provision of this section shall be 
     construed as altering or affecting the applicability or 
     continuing effectiveness of any law, regulation, provision, 
     or other action of any State, including those described in 
     subparagraph (B), to the extent that the State law, 
     regulation, provision, or other action is not inconsistent 
     with the provisions of this subtitle related to market entry 
     for nonresident insurance producers, and then only to the 
     extent of the inconsistency.
       ``(B) Preserved regulations.--The laws, regulations, 
     provisions, or other actions of any State referred to in 
     subparagraph (A) include laws, regulations, provisions, or 
     other actions that--
       ``(i) regulate market conduct, insurance producer conduct, 
     or unfair trade practices;
       ``(ii) establish consumer protections; or
       ``(iii) require insurance producers to be appointed by a 
     licensed or authorized insurer.
       ``(f) Biennial Renewal.--Membership in the Association 
     shall be renewed on a biennial basis.
       ``(g) Continuing Education.--
       ``(1) In general.--The Association shall establish, as a 
     condition of membership, continuing education requirements 
     which shall be comparable to the continuing education 
     requirements under the licensing laws of a majority of the 
     States.
       ``(2) State continuing education requirements.--A member 
     may not be required to satisfy continuing education 
     requirements imposed under the laws, regulations, provisions, 
     or actions of any State other than the home State of the 
     member.
       ``(3) Reciprocity.--The Association shall not require a 
     member to satisfy continuing education requirements that are 
     equivalent to any continuing education requirements of the 
     home State of the member that have been satisfied by the 
     member during the applicable licensing period.
       ``(4) Limitation on the association.--The Association shall 
     not directly or indirectly offer any continuing education 
     courses for insurance producers.
       ``(h) Probation, Suspension and Revocation.--
       ``(1) Disciplinary action.--The Association may place an 
     insurance producer that is a member of the Association on 
     probation or suspend or revoke the membership of the 
     insurance producer in the Association, or assess monetary 
     fines or penalties, as the Association determines to be 
     appropriate, if--
       ``(A) the insurance producer fails to meet the applicable 
     membership criteria or other standards established by the 
     Association;
       ``(B) the insurance producer has been subject to 
     disciplinary action pursuant to a final adjudicatory 
     proceeding under the jurisdiction of a State insurance 
     regulator;
       ``(C) an insurance license held by the insurance producer 
     has been suspended or revoked by a State insurance regulator; 
     or
       ``(D) the insurance producer has been convicted of a crime 
     that would have resulted in the denial of membership pursuant 
     to subsection (a)(4)(L)(i) at the time of application, and 
     the Association has received a copy of the final disposition 
     from a court of competent jurisdiction.
       ``(2) Violations of association standards.--The Association 
     shall have the power to investigate alleged violations of 
     Association standards.
       ``(3) Reporting.--The Association shall immediately notify 
     the States (including State insurance regulators) and the 
     NAIC when the membership of an insurance producer has been 
     placed on probation or has been suspended, revoked, or 
     otherwise terminated, or when the Association has assessed 
     monetary fines or penalties.
       ``(i) Consumer Complaints.--
       ``(1) In general.--The Association shall--
       ``(A) refer any complaint against a member of the 
     Association from a consumer relating to alleged misconduct or 
     violations of State insurance laws to the State insurance 
     regulator where the consumer resides and, when appropriate, 
     to any additional State insurance regulator, as determined by 
     standards adopted by the Association; and
       ``(B) make any related records and information available to 
     each State insurance regulator to whom the complaint is 
     forwarded.
       ``(2) Telephone and other access.--The Association shall 
     maintain a toll-free number for purposes of this subsection 
     and, as practicable, other alternative means of communication 
     with consumers, such as an Internet webpage.
       ``(3) Final disposition of investigation.--State insurance 
     regulators shall provide the Association with information 
     regarding the final disposition of a complaint referred 
     pursuant to paragraph (1)(A), but nothing shall be construed 
     to compel a State to release confidential investigation 
     reports or other information protected by State law to the 
     Association.
       ``(j) Information Sharing.--The Association may--
       ``(1) share documents, materials, or other information, 
     including confidential and privileged documents, with a 
     State, Federal, or international governmental entity or with 
     the NAIC or other appropriate entity referenced in paragraphs 
     (3) and (4), provided that the recipient has the authority 
     and agrees to maintain the confidentiality or privileged 
     status of the document, material, or other information;
       ``(2) limit the sharing of information as required under 
     this subtitle with the NAIC or any other non-governmental 
     entity, in circumstances under which the Association 
     determines that the sharing of such information is 
     unnecessary to further the purposes of this subtitle;
       ``(3) establish a central clearinghouse, or utilize the 
     NAIC or another appropriate entity, as determined by the 
     Association, as a central clearinghouse, for use by the 
     Association and the States (including State insurance 
     regulators), through which members of the Association may 
     disclose their intent to operate in 1 or more States and pay 
     the licensing fees to the appropriate States; and
       ``(4) establish a database, or utilize the NAIC or another 
     appropriate entity, as determined by the Association, as a 
     database, for use by the Association and the States 
     (including State insurance regulators) for the collection of 
     regulatory information concerning the activities of insurance 
     producers.
       ``(k) Effective Date.--The provisions of this section shall 
     take effect on the later of--
       ``(1) the expiration of the 2-year period beginning on the 
     date of enactment of the National Association of Registered 
     Agents and Brokers Reform Act of 2014; and
       ``(2) the date of incorporation of the Association.

[[Page S4593]]

     ``SEC. 324. BOARD OF DIRECTORS.

       ``(a) Establishment.--There is established a board of 
     directors of the Association, which shall have authority to 
     govern and supervise all activities of the Association.
       ``(b) Powers.--The Board shall have such of the powers and 
     authority of the Association as may be specified in the 
     bylaws of the Association.
       ``(c) Composition.--
       ``(1) In general.--The Board shall consist of 13 members 
     who shall be appointed by the President, by and with the 
     advice and consent of the Senate, in accordance with the 
     procedures established under Senate Resolution 116 of the 
     112th Congress, of whom--
       ``(A) 8 shall be State insurance commissioners appointed in 
     the manner provided in paragraph (2), 1 of whom shall be 
     designated by the President to serve as the chairperson of 
     the Board until the Board elects one such State insurance 
     commissioner Board member to serve as the chairperson of the 
     Board;
       ``(B) 3 shall have demonstrated expertise and experience 
     with property and casualty insurance producer licensing; and
       ``(C) 2 shall have demonstrated expertise and experience 
     with life or health insurance producer licensing.
       ``(2) State insurance regulator representatives.--
       ``(A) Recommendations.--Before making any appointments 
     pursuant to paragraph (1)(A), the President shall request a 
     list of recommended candidates from the States through the 
     NAIC, which shall not be binding on the President. If the 
     NAIC fails to submit a list of recommendations not later than 
     15 business days after the date of the request, the President 
     may make the requisite appointments without considering the 
     views of the NAIC.
       ``(B) Political affiliation.--Not more than 4 Board members 
     appointed under paragraph (1)(A) shall belong to the same 
     political party.
       ``(C) Former state insurance commissioners.--
       ``(i) In general.--If, after offering each currently 
     serving State insurance commissioner an appointment to the 
     Board, fewer than 8 State insurance commissioners have 
     accepted appointment to the Board, the President may appoint 
     the remaining State insurance commissioner Board members, as 
     required under paragraph (1)(A), of the appropriate political 
     party as required under subparagraph (B), from among 
     individuals who are former State insurance commissioners.
       ``(ii) Limitation.--A former State insurance commissioner 
     appointed as described in clause (i) may not be employed by 
     or have any present direct or indirect financial interest in 
     any insurer, insurance producer, or other entity in the 
     insurance industry, other than direct or indirect ownership 
     of, or beneficial interest in, an insurance policy or annuity 
     contract written or sold by an insurer.
       ``(D) Service through term.--If a Board member appointed 
     under paragraph (1)(A) ceases to be a State insurance 
     commissioner during the term of the Board member, the Board 
     member shall cease to be a Board member.
       ``(3) Private sector representatives.--In making any 
     appointment pursuant to subparagraph (B) or (C) of paragraph 
     (1), the President may seek recommendations for candidates 
     from groups representing the category of individuals 
     described, which shall not be binding on the President.
       ``(4) State insurance commissioner defined.--For purposes 
     of this subsection, the term `State insurance commissioner' 
     means a person who serves in the position in State 
     government, or on the board, commission, or other body that 
     is the primary insurance regulatory authority for the State.
       ``(d) Terms.--
       ``(1) In general.--Except as provided under paragraph (2), 
     the term of service for each Board member shall be 2 years.
       ``(2) Exceptions.--
       ``(A) 1-year terms.--The term of service shall be 1 year, 
     as designated by the President at the time of the nomination 
     of the subject Board members for--
       ``(i) 4 of the State insurance commissioner Board members 
     initially appointed under paragraph (1)(A), of whom not more 
     than 2 shall belong to the same political party;
       ``(ii) 1 of the Board members initially appointed under 
     paragraph (1)(B); and
       ``(iii) 1 of the Board members initially appointed under 
     paragraph (1)(C).
       ``(B) Expiration of term.--A Board member may continue to 
     serve after the expiration of the term to which the Board 
     member was appointed for the earlier of 2 years or until a 
     successor is appointed.
       ``(C) Mid-term appointments.--A Board member appointed to 
     fill a vacancy occurring before the expiration of the term 
     for which the predecessor of the Board member was appointed 
     shall be appointed only for the remainder of that term.
       ``(3) Successive terms.--Board members may be reappointed 
     to successive terms.
       ``(e) Initial Appointments.--The appointment of initial 
     Board members shall be made no later than 90 days after the 
     date of enactment of the National Association of Registered 
     Agents and Brokers Reform Act of 2014.
       ``(f) Meetings.--
       ``(1) In general.--The Board shall meet--
       ``(A) at the call of the chairperson;
       ``(B) as requested in writing to the chairperson by not 
     fewer than 5 Board members; or
       ``(C) as otherwise provided by the bylaws of the 
     Association.
       ``(2) Quorum required.--A majority of all Board members 
     shall constitute a quorum.
       ``(3) Voting.--Decisions of the Board shall require the 
     approval of a majority of all Board members present at a 
     meeting, a quorum being present.
       ``(4) Initial meeting.--The Board shall hold its first 
     meeting not later than 45 days after the date on which all 
     initial Board members have been appointed.
       ``(g) Restriction on Confidential Information.--Board 
     members appointed pursuant to subparagraphs (B) and (C) of 
     subsection (c)(1) shall not have access to confidential 
     information received by the Association in connection with 
     complaints, investigations, or disciplinary proceedings 
     involving insurance producers.
       ``(h) Ethics and Conflicts of Interest.--The Board shall 
     issue and enforce an ethical conduct code to address 
     permissible and prohibited activities of Board members and 
     Association officers, employees, agents, or consultants. The 
     code shall, at a minimum, include provisions that prohibit 
     any Board member or Association officer, employee, agent or 
     consultant from--
       ``(1) engaging in unethical conduct in the course of 
     performing Association duties;
       ``(2) participating in the making or influencing the making 
     of any Association decision, the outcome of which the Board 
     member, officer, employee, agent, or consultant knows or had 
     reason to know would have a reasonably foreseeable material 
     financial effect, distinguishable from its effect on the 
     public generally, on the person or a member of the immediate 
     family of the person;
       ``(3) accepting any gift from any person or entity other 
     than the Association that is given because of the position 
     held by the person in the Association;
       ``(4) making political contributions to any person or 
     entity on behalf of the Association; and
       ``(5) lobbying or paying a person to lobby on behalf of the 
     Association.
       ``(i) Compensation.--
       ``(1) In general.--Except as provided in paragraph (2), no 
     Board member may receive any compensation from the 
     Association or any other person or entity on account of Board 
     membership.
       ``(2) Travel expenses and per diem.--Board members may be 
     reimbursed only by the Association for travel expenses, 
     including per diem in lieu of subsistence, at rates 
     consistent with rates authorized for employees of Federal 
     agencies under subchapter I of chapter 57 of title 5, United 
     States Code, while away from home or regular places of 
     business in performance of services for the Association.

     ``SEC. 325. BYLAWS, STANDARDS, AND DISCIPLINARY ACTIONS.

       ``(a) Adoption and Amendment of Bylaws and Standards.--
       ``(1) Procedures.--The Association shall adopt procedures 
     for the adoption of bylaws and standards that are similar to 
     procedures under subchapter II of chapter 5 of title 5, 
     United States Code (commonly known as the `Administrative 
     Procedure Act').
       ``(2) Copy required to be filed.--The Board shall submit to 
     the President, through the Department of the Treasury, and 
     the States (including State insurance regulators), and shall 
     publish on the website of the Association, all proposed 
     bylaws and standards of the Association, or any proposed 
     amendment to the bylaws or standards of the Association, 
     accompanied by a concise general statement of the basis and 
     purpose of such proposal.
       ``(3) Effective date.--Any proposed bylaw or standard of 
     the Association, and any proposed amendment to the bylaws or 
     standards of the Association, shall take effect, after notice 
     under paragraph (2) and opportunity for public comment, on 
     such date as the Association may designate, unless suspended 
     under section 329(c).
       ``(4) Rule of construction.--Nothing in this section shall 
     be construed to subject the Board or the Association to the 
     requirements of subchapter II of chapter 5 of title 5, United 
     States Code (commonly known as the `Administrative Procedure 
     Act').
       ``(b) Disciplinary Action by the Association.--
       ``(1) Specification of charges.--In any proceeding to 
     determine whether membership shall be denied, suspended, 
     revoked, or not renewed, or to determine whether a member of 
     the Association should be placed on probation (referred to in 
     this section as a `disciplinary action') or whether to assess 
     fines or monetary penalties, the Association shall bring 
     specific charges, notify the member of the charges, give the 
     member an opportunity to defend against the charges, and keep 
     a record.
       ``(2) Supporting statement.--A determination to take 
     disciplinary action shall be supported by a statement setting 
     forth--
       ``(A) any act or practice in which the member has been 
     found to have been engaged;
       ``(B) the specific provision of this subtitle or standard 
     of the Association that any such act or practice is deemed to 
     violate; and
       ``(C) the sanction imposed and the reason for the sanction.
       ``(3) Ineligibility of private sector representatives.--
     Board members appointed pursuant to section 324(c)(3) may 
     not--
       ``(A) participate in any disciplinary action or be counted 
     toward establishing a quorum during a disciplinary action; 
     and
       ``(B) have access to confidential information concerning 
     any disciplinary action.

[[Page S4594]]

     ``SEC. 326. POWERS.

       ``In addition to all the powers conferred upon a nonprofit 
     corporation by the District of Columbia Nonprofit Corporation 
     Act, the Association shall have the power to--
       ``(1) establish and collect such membership fees as the 
     Association finds necessary to impose to cover the costs of 
     its operations;
       ``(2) adopt, amend, and repeal bylaws, procedures, or 
     standards governing the conduct of Association business and 
     performance of its duties;
       ``(3) establish procedures for providing notice and 
     opportunity for comment pursuant to section 325(a);
       ``(4) enter into and perform such agreements as necessary 
     to carry out the duties of the Association;
       ``(5) hire employees, professionals, or specialists, and 
     elect or appoint officers, and to fix their compensation, 
     define their duties and give them appropriate authority to 
     carry out the purposes of this subtitle, and determine their 
     qualification;
       ``(6) establish personnel policies of the Association and 
     programs relating to, among other things, conflicts of 
     interest, rates of compensation, where applicable, and 
     qualifications of personnel;
       ``(7) borrow money; and
       ``(8) secure funding for such amounts as the Association 
     determines to be necessary and appropriate to organize and 
     begin operations of the Association, which shall be treated 
     as loans to be repaid by the Association with interest at 
     market rate.

     ``SEC. 327. REPORT BY THE ASSOCIATION.

       ``(a) In General.--As soon as practicable after the close 
     of each fiscal year, the Association shall submit to the 
     President, through the Department of the Treasury, and the 
     States (including State insurance regulators), and shall 
     publish on the website of the Association, a written report 
     regarding the conduct of its business, and the exercise of 
     the other rights and powers granted by this subtitle, during 
     such fiscal year.
       ``(b) Financial Statements.--Each report submitted under 
     subsection (a) with respect to any fiscal year shall include 
     audited financial statements setting forth the financial 
     position of the Association at the end of such fiscal year 
     and the results of its operations (including the source and 
     application of its funds) for such fiscal year.

     ``SEC. 328. LIABILITY OF THE ASSOCIATION AND THE BOARD 
                   MEMBERS, OFFICERS, AND EMPLOYEES OF THE 
                   ASSOCIATION.

       ``(a) In General.--The Association shall not be deemed to 
     be an insurer or insurance producer within the meaning of any 
     State law, rule, regulation, or order regulating or taxing 
     insurers, insurance producers, or other entities engaged in 
     the business of insurance, including provisions imposing 
     premium taxes, regulating insurer solvency or financial 
     condition, establishing guaranty funds and levying 
     assessments, or requiring claims settlement practices.
       ``(b) Liability of Board Members, Officers, and 
     Employees.--No Board member, officer, or employee of the 
     Association shall be personally liable to any person for any 
     action taken or omitted in good faith in any matter within 
     the scope of their responsibilities in connection with the 
     Association.

     ``SEC. 329. PRESIDENTIAL OVERSIGHT.

       ``(a) Removal of Board.--If the President determines that 
     the Association is acting in a manner contrary to the 
     interests of the public or the purposes of this subtitle or 
     has failed to perform its duties under this subtitle, the 
     President may remove the entire existing Board for the 
     remainder of the term to which the Board members were 
     appointed and appoint, in accordance with section 324 and 
     with the advice and consent of the Senate, in accordance with 
     the procedures established under Senate Resolution 116 of the 
     112th Congress, new Board members to fill the vacancies on 
     the Board for the remainder of the terms.
       ``(b) Removal of Board Member.--The President may remove a 
     Board member only for neglect of duty or malfeasance in 
     office.
       ``(c) Suspension of Bylaws and Standards and Prohibition of 
     Actions.--Following notice to the Board, the President, or a 
     person designated by the President for such purpose, may 
     suspend the effectiveness of any bylaw or standard, or 
     prohibit any action, of the Association that the President or 
     the designee determines is contrary to the purposes of this 
     subtitle.

     ``SEC. 330. RELATIONSHIP TO STATE LAW.

       ``(a) Preemption of State Laws.--State laws, regulations, 
     provisions, or other actions purporting to regulate insurance 
     producers shall be preempted to the extent provided in 
     subsection (b).
       ``(b) Prohibited Actions.--
       ``(1) In general.--No State shall--
       ``(A) impede the activities of, take any action against, or 
     apply any provision of law or regulation arbitrarily or 
     discriminatorily to, any insurance producer because that 
     insurance producer or any affiliate plans to become, has 
     applied to become, or is a member of the Association;
       ``(B) impose any requirement upon a member of the 
     Association that it pay fees different from those required to 
     be paid to that State were it not a member of the 
     Association; or
       ``(C) impose any continuing education requirements on any 
     nonresident insurance producer that is a member of the 
     Association.
       ``(2) States other than a home state.--No State, other than 
     the home State of a member of the Association, shall--
       ``(A) impose any licensing, personal or corporate 
     qualifications, education, training, experience, residency, 
     continuing education, or bonding requirement upon a member of 
     the Association that is different from the criteria for 
     membership in the Association or renewal of such membership;
       ``(B) impose any requirement upon a member of the 
     Association that it be licensed, registered, or otherwise 
     qualified to do business or remain in good standing in the 
     State, including any requirement that the insurance producer 
     register as a foreign company with the secretary of state or 
     equivalent State official;
       ``(C) require that a member of the Association submit to a 
     criminal history record check as a condition of doing 
     business in the State; or
       ``(D) impose any licensing, registration, or appointment 
     requirements upon a member of the Association, or require a 
     member of the Association to be authorized to operate as an 
     insurance producer, in order to sell, solicit, or negotiate 
     insurance for commercial property and casualty risks to an 
     insured with risks located in more than one State, if the 
     member is licensed or otherwise authorized to operate in the 
     State where the insured maintains its principal place of 
     business and the contract of insurance insures risks located 
     in that State.
       ``(3) Preservation of state disciplinary authority.--
     Nothing in this section may be construed to prohibit a State 
     from investigating and taking appropriate disciplinary 
     action, including suspension or revocation of authority of an 
     insurance producer to do business in a State, in accordance 
     with State law and that is not inconsistent with the 
     provisions of this section, against a member of the 
     Association as a result of a complaint or for any alleged 
     activity, regardless of whether the activity occurred before 
     or after the insurance producer commenced doing business in 
     the State pursuant to Association membership.

     ``SEC. 331. COORDINATION WITH FINANCIAL INDUSTRY REGULATORY 
                   AUTHORITY.

       ``The Association shall coordinate with the Financial 
     Industry Regulatory Authority in order to ease any 
     administrative burdens that fall on members of the 
     Association that are subject to regulation by the Financial 
     Industry Regulatory Authority, consistent with the 
     requirements of this subtitle and the Federal securities 
     laws.

     ``SEC. 332. RIGHT OF ACTION.

       ``(a) Right of Action.--Any person aggrieved by a decision 
     or action of the Association may, after reasonably exhausting 
     available avenues for resolution within the Association, 
     commence a civil action in an appropriate United States 
     district court, and obtain all appropriate relief.
       ``(b) Association Interpretations.--In any action under 
     subsection (a), the court shall give appropriate weight to 
     the interpretation of the Association of its bylaws and 
     standards and this subtitle.

     ``SEC. 333. FEDERAL FUNDING PROHIBITED.

       ``The Association may not receive, accept, or borrow any 
     amounts from the Federal Government to pay for, or reimburse, 
     the Association for, the costs of establishing or operating 
     the Association.

     ``SEC. 334. DEFINITIONS.

       ``For purposes of this subtitle, the following definitions 
     shall apply:
       ``(1) Business entity.--The term `business entity' means a 
     corporation, association, partnership, limited liability 
     company, limited liability partnership, or other legal 
     entity.
       ``(2) Depository institution.--The term `depository 
     institution' has the meaning as in section 3 of the Federal 
     Deposit Insurance Act (12 U.S.C. 1813).
       ``(3) Home state.--The term `home State' means the State in 
     which the insurance producer maintains its principal place of 
     residence or business and is licensed to act as an insurance 
     producer.
       ``(4) Insurance.--The term `insurance' means any product, 
     other than title insurance or bail bonds, defined or 
     regulated as insurance by the appropriate State insurance 
     regulatory authority.
       ``(5) Insurance producer.--The term `insurance producer' 
     means any insurance agent or broker, excess or surplus lines 
     broker or agent, insurance consultant, limited insurance 
     representative, and any other individual or entity that 
     sells, solicits, or negotiates policies of insurance or 
     offers advice, counsel, opinions or services related to 
     insurance.
       ``(6) Insurer.--The term `insurer' has the meaning as in 
     section 313(e)(2)(B) of title 31, United States Code.
       ``(7) Principal place of business.--The term `principal 
     place of business' means the State in which an insurance 
     producer maintains the headquarters of the insurance producer 
     and, in the case of a business entity, where high-level 
     officers of the entity direct, control, and coordinate the 
     business activities of the business entity.
       ``(8) Principal place of residence.--The term `principal 
     place of residence' means the State in which an insurance 
     producer resides for the greatest number of days during a 
     calendar year.
       ``(9) State.--The term `State' includes any State, the 
     District of Columbia, any territory of the United States, and 
     Puerto Rico, Guam, American Samoa, the Trust Territory of the 
     Pacific Islands, the Virgin Islands, and the Northern Mariana 
     Islands.

[[Page S4595]]

       ``(10) State law.--
       ``(A) In general.--The term `State law' includes all laws, 
     decisions, rules, regulations, or other State action having 
     the effect of law, of any State.
       ``(B) Laws applicable in the district of columbia.--A law 
     of the United States applicable only to or within the 
     District of Columbia shall be treated as a State law rather 
     than a law of the United States.

     ``SEC. 335. SUNSET.

       ``The provisions of this subtitle, and any program or 
     authorities established or granted therein or derived 
     therefrom, shall terminate on the date that is 2 years after 
     the date on which the Association approves its first member 
     pursuant to section 323.''.
       (b) Technical Amendment.--The table of contents for the 
     Gramm-Leach-Bliley Act is amended by striking the items 
     relating to subtitle C of title III and inserting the 
     following new items:

  ``Subtitle C--National Association of Registered Agents and Brokers

``Sec. 321. National Association of Registered Agents and Brokers.
``Sec. 322. Purpose.
``Sec. 323. Membership.
``Sec. 324. Board of directors.
``Sec. 325. Bylaws, standards, and disciplinary actions.
``Sec. 326. Powers.
``Sec. 327. Report by the Association.
``Sec. 328. Liability of the Association and the Board members, 
              officers, and employees of the Association.
``Sec. 329. Presidential oversight.
``Sec. 330. Relationship to State law.
``Sec. 331. Coordination with Financial Industry Regulatory Authority.
``Sec. 332. Right of action.
``Sec. 333. Federal funding prohibited.
``Sec. 334. Definitions.
``Sec. 335. Sunset.''.

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