[House Report 106-40]
[From the U.S. Government Publishing Office]



106th Congress                                                   Report
1st Session            HOUSE OF REPRESENTATIVES                  106-40
_______________________________________________________________________


 
           DISASTER MITIGATION AND COST REDUCTION ACT OF 1999

_______________________________________________________________________


 March 3, 1999.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Shuster, from the Committee on Transportation and Infrastructure, 
                        submitted the following

                              R E P O R T

                             together with

                            ADDITIONAL VIEWS

                        [To accompany H.R. 707]

    The Committee on Transportation and Infrastructure, to whom 
was referred the bill (H.R. 707) to amend the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act to 
authorize a program for predisaster mitigation, to streamline 
the administration of disaster relief, to control the Federal 
costs of disaster assistance, and for other purposes, having 
considered the same, report favorably thereon with amendments 
and recommend that the bill as amended do pass.
  The amendments are as follows:
  Strike out all after the enacting clause and insert in lieu 
thereof the following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Disaster Mitigation and Cost Reduction 
Act of 1999''.

SEC. 2. AMENDMENTS TO ROBERT T. STAFFORD DISASTER RELIEF AND EMERGENCY 
                    ASSISTANCE ACT.

  Except as otherwise specifically provided, whenever in this Act an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision of law, the reference shall be 
considered to be made to a section or other provision of the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 
et seq.).

                 TITLE I--PREDISASTER HAZARD MITIGATION

SEC. 101. FINDINGS AND PURPOSE.

  (a) Findings.--Congress finds that--
          (1) greater emphasis needs to be placed on identifying and 
        assessing the risks to State and local communities and 
        implementing adequate measures to reduce losses from natural 
        disasters and to ensure that critical facilities and public 
        infrastructure will continue to function after a disaster;
          (2) expenditures for post-disaster assistance are increasing 
        without commensurate reduction in the likelihood of future 
        losses from such natural disasters;
          (3) a high priority in the expenditure of Federal funds under 
        the Robert T. Stafford Disaster Relief and Emergency Assistance 
        Act should be to implement predisaster activities at the local 
        level; and
          (4) with a unified effort of economic incentives, awareness 
        and education, technical assistance, and demonstrated Federal 
        support, States and local communities will be able to increase 
        their capabilities to form effective community-based 
        partnerships for mitigation purposes, implement effective 
        natural disaster mitigation measures that reduce the risk of 
        future damage, hardship, and suffering, ensure continued 
        functioning of critical facilities and public infrastructure, 
        leverage additional non-Federal resources into meeting disaster 
        resistance goals, and make commitments to long-term mitigation 
        efforts in new and existing structures.
  (b) Purpose.--It is the purpose of this title to establish a 
predisaster hazard mitigation program that--
          (1) reduces the loss of life and property, human suffering, 
        economic disruption, and disaster assistance costs resulting 
        from natural hazards; and
          (2) provides a source of predisaster hazard mitigation 
        funding that will assist States and local governments in 
        implementing effective mitigation measures that are designed to 
        ensure the continued functioning of critical facilities and 
        public infrastructure after a natural disaster.

SEC. 102. STATE MITIGATION PROGRAM.

  Section 201(c) (42 U.S.C. 5131(c)) is amended--
          (1) by striking ``and'' at the end of paragraph (1);
          (2) by striking the period at the end of paragraph (2) and 
        inserting ``; and''; and
          (3) by adding at the end the following:
          ``(3) set forth, with the ongoing cooperation of local 
        governments and consistent with section 409, a comprehensive 
        and detailed State program for mitigating against emergencies 
        and major disasters, including provisions for prioritizing 
        mitigation measures.''.

SEC. 103. DISASTER ASSISTANCE PLANS.

  Section 201(d) (42 U.S.C. 5131(d)) is amended to read as follows:
  ``(d) Grants for Disaster Assistance and Hazard Identification.--The 
President is authorized to make grants for--
          ``(1) not to exceed 50 percent of the cost of improving, 
        maintaining, and updating State disaster assistance plans 
        including, consistent with section 409, evaluation of natural 
        hazards and development of the programs and actions required to 
        mitigate such hazards; and
          ``(2) the development and application of improved floodplain 
        mapping technologies that can be used by Federal, State, and 
        local governments and that the President determines will likely 
        result in substantial savings over current floodplain mapping 
        methods.''.

SEC. 104. PREDISASTER HAZARD MITIGATION.

  Title II (42 U.S.C. 5131-5132) is amended by adding at the end the 
following:

``SEC. 203. PREDISASTER HAZARD MITIGATION.

  ``(a) General Authority.--The President may establish a program to 
provide financial assistance to States and local governments for the 
purpose of undertaking predisaster hazard mitigation activities that 
are cost effective and substantially reduce the risk of future damage, 
hardship, or suffering from a major disaster.
  ``(b) Purpose of Assistance.--
          ``(1) In general.--Except as provided in paragraph (2), a 
        State or local government that receives financial assistance 
        under this section shall use the assistance for funding 
        activities that are cost effective and substantially reduce the 
        risk of future damage, hardship, or suffering from a major 
        disaster.
          ``(2) Dissemination.--The State or local government may use 
        not more than 10 percent of financial assistance it receives 
        under this section in a fiscal year for funding activities to 
        disseminate information regarding cost effective mitigation 
        technologies (such as preferred construction practices and 
        materials), including establishing and maintaining centers for 
        protection against natural disasters to carry out such 
        dissemination.
  ``(c) Allocation of Funds.--The amount of financial assistance to be 
made available to a State, including amounts made available to local 
governments of such State, under this section in a fiscal year shall--
          ``(1) not be less than the lesser of $500,000 or 1.0 percent 
        of the total funds appropriated to carry out this section for 
        such fiscal year; but
          ``(2) not exceed 15 percent of such total funds.
  ``(d) Criteria.--Subject to the limitations of subsections (c) and 
(e), in determining whether to provide assistance to a State or local 
government under this section and the amount of such assistance, the 
President shall consider the following criteria:
          ``(1) The clear identification of prioritized cost-effective 
        mitigation activities that produce meaningful and definable 
        outcomes.
          ``(2) If the State has submitted a mitigation program in 
        cooperation with local governments under section 201(c), the 
        degree to which the activities identified in paragraph (1) are 
        consistent with the State mitigation program.
          ``(3) The extent to which assistance will fund activities 
        that mitigate hazards evaluated under section 409.
          ``(4) The opportunity to fund activities that maximize net 
        benefits to society.
          ``(5) The ability of the State or local government to fund 
        mitigation activities.
          ``(6) The extent to which assistance will fund mitigation 
        activities in small impoverished communities.
          ``(7) The level of interest by the private sector to enter 
        into a partnership to promote mitigation.
          ``(8) Such other criteria as the President establishes in 
        consultation with State and local governments.
  ``(e) State Nominations.--
          ``(1) In general.--The Governor of each State may recommend 
        to the President not less than 5 local governments to receive 
        assistance under this section. The recommendations shall be 
        submitted to the President not later than October 1, 1999, and 
        each October 1st thereafter or such later date in the year as 
        the President may establish. In making such recommendations, 
        the Governors shall consider the criteria identified in 
        subsection (d).
          ``(2) Use.--
                  ``(A) General rule.--In providing assistance to local 
                governments under this section, the President shall 
                select from local governments recommended by the 
                Governors under this subsection.
                  ``(B) Waiver.--Upon request of a local government, 
                the President may waive the limitation in subparagraph 
                (A) if the President determines that extraordinary 
                circumstances justify the waiver and that granting the 
                waiver will further the purpose of this section.
          ``(3) Effect of failure to nominate.--If a Governor of a 
        State fails to submit recommendations under this subsection in 
        a timely manner, the President may select, subject to the 
        criteria in subsection (d), any local governments of the State 
        to receive assistance under this section.
  ``(f) Small Impoverished Communities.--For the purpose of this 
section, the term `small impoverished communities' means communities of 
3,000 or fewer individuals that are economically disadvantaged, as 
determined by the State in which the community is located and based on 
criteria established by the President.
  ``(g) Federal Share.--Financial assistance provided under this 
section may contribute up to 75 percent of the total cost of mitigation 
activities approved by the President; except that the President may 
contribute up to 90 percent of the total cost of mitigation activities 
in small impoverished communities.
  ``(h) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $25,000,000 for fiscal year 1999 
and $80,000,000 for fiscal year 2000.
  ``(i) Authorization of Section 404 Funds.--Effective October 1, 2000, 
in addition to amounts appropriated under subsection (h) from only 
appropriations enacted after October 1, 2000, the President may use, to 
carry out this section, funds that are appropriated to carry out 
section 404 for post-disaster mitigation activities thathave not been 
obligated within 30 months of the disaster declaration upon which the 
funding availability is based.
  ``(j) Report on Federal and State Administration.--Not later than 18 
months after the date of enactment of the Disaster Mitigation and Cost 
Reduction Act of 1999, the President, in consultation with State and 
local governments, shall transmit to Congress a report evaluating 
efforts to implement this section and recommending a process for 
transferring greater authority and responsibility for administering the 
assistance program authorized by this section to capable States.''.

SEC. 105. INTERAGENCY TASK FORCE.

  The President shall establish an interagency task force for the 
purpose of coordinating the implementation of the predisaster hazard 
mitigation program authorized by section 203 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act. The Director of the 
Federal Emergency Management Agency shall chair such task force.

SEC. 106. MAXIMUM CONTRIBUTION FOR MITIGATION COSTS.

  (a) In General.--Section 404(a) (42 U.S.C. 5170c(a)) is amended by 
striking ``15 percent'' and inserting ``20 percent''.
  (b) Applicability.--The amendment made by subsection (a) shall apply 
to major disasters declared under the Robert T. Stafford Disaster 
Relief Act and Emergency Assistance Act after January 1, 1997.

SEC. 107. CONFORMING AMENDMENT.

  The heading for title II is amended to read as follows:

     ``TITLE II--DISASTER PREPAREDNESS AND MITIGATION ASSISTANCE''.

               TITLE II--STREAMLINING AND COST REDUCTION

SEC. 201. MANAGEMENT COSTS.

  (a) In General.--Title III (42 U.S.C. 5141-5164) is amended by adding 
at the end the following:

``SEC. 322. MANAGEMENT COSTS.

  ``(a) In General.--Notwithstanding any other provision of law 
(including any administrative rule or guidance), the President shall 
establish by rule management cost rates for grantees and subgrantees. 
Such rates shall be used to determine contributions under this Act for 
management costs.
  ``(b) Management Costs Defined.--Management costs include indirect 
costs, administrative expenses, associated expenses, and any other 
expenses not directly chargeable to a specific project under a major 
disaster, emergency, or emergency preparedness activity or measure. 
Such costs include the necessary costs of requesting, obtaining, and 
administering Federal assistance and costs incurred by a State for 
preparation of damage survey reports, final inspection reports, project 
applications, final audits, and related field inspections by State 
employees, including overtime pay and per diem and travel expenses of 
such employees, but not including pay for regular time of such 
employees.
  ``(c) Review.--The President shall review the management cost rates 
established under subsection (a) not later than 3 years after the date 
of establishment of such rates and periodically thereafter.''.
  (b) Applicability.--Section 322 of the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act (as added by subsection (a) of this 
section) shall apply as follows:
          (1) Subsections (a) and (b) of such section 322 shall apply 
        to major disasters declared under such Act on or after the date 
        of enactment of this Act. Until the date on which the President 
        establishes the management cost rates under such subsection, 
        section 406(f) shall be used for establishing such rates.
          (2) Subsection (c) of such section 322 shall apply to major 
        disasters declared under such Act on or after the date on which 
        the President establishes such rates under subsection (a) of 
        such section 322.

SEC. 202. ASSISTANCE TO REPAIR, RESTORE, RECONSTRUCT, OR REPLACE 
                    DAMAGED FACILITIES.

  (a) Contributions.--Section 406(a) (42 U.S.C. 5172(a)) is amended to 
read as follows:
  ``(a) Contributions.--
          ``(1) In general.--The President may make contributions--
                  ``(A) to a State or local government for the repair, 
                restoration, reconstruction, or replacement of a public 
                facility which is damaged or destroyed by a major 
                disaster and for associated expenses incurred by such 
                government; and
                  ``(B) subject to paragraph (2), to a person who owns 
                or operates a private nonprofit facility damaged or 
                destroyed by a major disaster for the repair, 
                restoration, reconstruction, or replacement of such 
                facility and for associated expenses incurred by such 
                person.
          ``(2) Conditions for assistance to private nonprofit 
        facilities.--
                  ``(A) In general.--The President may make 
                contributions to a private nonprofit facility under 
                paragraph (1)(B) only if--
                          ``(i) the facility provides critical services 
                        (as defined by the President) in the event of a 
                        major disaster; or
                          ``(ii)(I) the owner or operator of the 
                        facility has applied for a disaster loan under 
                        section 7(b) of the Small Business Act (15 
                        U.S.C. 636(b)); and
                          ``(II) has been determined to be ineligible 
                        for such a loan; or
                          ``(III) has obtained such a loan in the 
                        maximum amount for which the Small Business 
                        Administration determines the facility is 
                        eligible.
                  ``(B) Critical services defined.--In this paragraph, 
                the term `critical services' includes, but is not 
                limited to, power, water, sewer, wastewater treatment, 
                communications, and emergency medical care.''.
  (b) Minimum Federal Share.--Section 406(b) (42 U.S.C. 5172(b)) is 
amended to read as follows:
  ``(b) Minimum Federal Share.--The Federal share of assistance under 
this section shall be not less than 75 percent of the eligible cost of 
repair, restoration, reconstruction, or replacement carried out under 
this section.''.
  (c) Large In-Lieu Contributions.--Section 406(c) (42 U.S.C. 5172(c)) 
is amended to read as follows:
  ``(c) Large In-Lieu Contributions.--
          ``(1) For public facilities.--
                  ``(A) In general.--In any case in which a State or 
                local government determines that the public welfare 
                would not be best served by repairing, restoring, 
                reconstructing, or replacing any public facility owned 
                or controlled by such State or local government, the 
                State or local government may elect to receive, in lieu 
                of a contribution under subsection (a)(1)(A), a 
                contribution of 75 percent of the Federal share of the 
                Federal estimate of the cost of repairing, restoring, 
                reconstructing, or replacing such facility and of 
                management expenses.
                  ``(B) Use of funds.--Funds contributed to a State or 
                local government under this paragraph may be used to 
                repair, restore, or expand other selected public 
                facilities, to construct new facilities, or to fund 
                hazard mitigation measures which the State or local 
                government determines to be necessary to meet a need 
                for governmental services and functions in the area 
                affected by the major disaster.
          ``(2) For private nonprofit facilities.--
                  ``(A) In general.--In any case where a person who 
                owns or operates a private nonprofit facility 
                determines that the public welfare would not be best 
                served by repairing, restoring, reconstructing, or 
                replacing such facility, such person may elect to 
                receive, in lieu of a contribution under subsection 
                (a)(1)(B), a contribution of 75 percent of the Federal 
                share of the Federal estimate of the cost of repairing, 
                restoring, reconstructing, or replacing such facility 
                and of management expenses.
                  ``(B) Use of funds.--Funds contributed to a person 
                under this paragraph may be used to repair, restore, or 
                expand other selected private nonprofit facilities 
                owned or operated by the person, to construct new 
                private nonprofit facilities to be owned or operated by 
                the person, or to fund hazard mitigation measures that 
                the person determines to be necessary to meet a need 
                for its services and functions in the area affected by 
                the major disaster.
          ``(3) Modification of federal share.--The President shall 
        modify the Federal share of the cost estimate provided in 
        paragraphs (1) and (2) if thePresident determines an 
alternative cost share will likely reduce the total amount of Federal 
assistance provided under this section. The Federal cost share for 
purposes of paragraphs (1) and (2) shall not exceed 90 percent and 
shall not be less than 50 percent.''.
  (d) Eligible Cost.--
          (1) In general.--Section 406(e) (42 U.S.C. 5172(e)) is 
        amended to read as follows:
  ``(e) Eligible Cost.--
          ``(1) In general.--For the purposes of this section, the 
        estimate of the cost of repairing, restoring, reconstructing, 
        or replacing a public facility or private nonprofit facility on 
        the basis of the design of such facility as it existed 
        immediately before the major disaster and in conformity with 
        current applicable codes, specifications, and standards 
        (including floodplain management and hazard mitigation criteria 
        required by the President or by the Coastal Barrier Resources 
        Act (16 U.S.C. 3501 et seq.)) shall be treated as the eligible 
        cost of such repair, restoration, reconstruction, or 
        replacement. Subject to paragraph (2), the President shall use 
        the cost estimation procedures developed under paragraph (3) to 
        make the estimate under this paragraph.
          ``(2) Modification of eligible cost.--In the event the actual 
        cost of repairing, restoring, reconstructing, or replacing a 
        facility under this section is more than 120 percent or less 
        than 80 percent of the cost estimated under paragraph (1), the 
        President may determine that the eligible cost be the actual 
        cost of such repair, restoration, reconstruction, or 
        replacement. The government or person receiving assistance 
        under this section shall reimburse the President for the 
        portion of such assistance that exceeds the eligible cost of 
        such repair, restoration, reconstruction, or replacement.
          ``(3) Use of surplus funds.--In the event the actual cost of 
        repairing, restoring, reconstructing, or replacing a facility 
        under this section is less than 100 percent but not less than 
        80 percent of the cost estimated under paragraph (1), the 
        government or person receiving assistance under this section 
        shall use any surplus funds to perform activities that are 
        cost-effective and reduce the risk of future damage, hardship, 
        or suffering from a major disaster.
          ``(4) Expert panel.--Not later than 18 months after the date 
        of enactment of the Disaster Mitigation and Cost Reduction Act 
        of 1999, the President, acting through the Director of the 
        Federal Emergency Management Agency, shall establish an expert 
        panel, including representatives from the construction 
        industry, to develop procedures for estimating the cost of 
        repairing, restoring, reconstructing, or replacing a facility 
        consistent with industry practices.
          ``(5) Special rule.--In any case in which the facility being 
        repaired, restored, reconstructed, or replaced under this 
        section was under construction on the date of the major 
        disaster, the cost of repairing, restoring, reconstructing, or 
        replacing such facility shall include, for purposes of this 
        section, only those costs which, under the contract for such 
        construction, are the owner's responsibility and not the 
        contractor's responsibility.''.
          (2) Effective date.--The amendment made by paragraph (1) 
        shall take effect on the date of enactment of this Act, and 
        shall only apply to funds appropriated after the date of 
        enactment of this Act; except that paragraph (1) of section 
        406(e) of the Robert T. Stafford Disaster Relief and Emergency 
        Assistance Act (as amended by paragraph (1) of this subsection) 
        shall take effect on the date that the procedures developed 
        under paragraph (3) of such section take effect.
  (e) Associated Expenses.--
          (1) In general.--Section 406 (42 U.S.C. 4172) is amended by 
        striking subsection (f).
          (2) Other eligible costs.--Section 406(e) (42 U.S.C. 
        5172(e)), as amended by subsection (d) of this section, is 
        amended by adding at the end the following:
          ``(6) Other eligible costs.--For purposes of this section, 
        other eligible costs include the following:
                  ``(A) Costs of national guard.--The cost of 
                mobilizing and employing the National Guard for 
                performance of eligible work.
                  ``(B) Costs of prison labor.--The costs of using 
                prison labor to perform eligible work, including wages 
                actually paid, transportation to a worksite, and 
                extraordinary costs of guards, food, and lodging.
                  ``(C) Other labor costs.--Base and overtime wages for 
                an applicant's employees and extra hires performing 
                eligible work plus fringe benefits on such wages to the 
                extent that such benefits were being paid before the 
                disaster.''.
          (3) Effective date.--Paragraphs (1) and (2) shall take effect 
        on the date on which the President establishes management cost 
        rates under section 322(a) of the Robert T. Stafford Disaster 
        Relief and Emergency Assistance Act (as added by section 201(a) 
        of this Act). The amendment made by paragraph (1) shall only 
        apply to disasters declared by the President under such Act 
        after the date on which the President establishes such cost 
        rates.

SEC. 203. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

  (a) In General.--Section 408 (42 U.S.C. 5174) is amended to read as 
follows:

``SEC. 408. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

  ``(a) General Authority.--Subject to the requirements of this 
section, the President, in consultation with the Governor of the 
affected State, may provide financial assistance, and, if necessary, 
direct services, to disaster victims who as a direct result of a major 
disaster have necessary expenses and serious needs where such victims 
are unable to meet such expenses or needs through other means.
  ``(b) Housing Assistance.--
          ``(1) Eligibility.--The President may provide financial or 
        other assistance under this section to individuals and families 
        to respond to the disaster-related housing needs of those who 
        are displaced from their predisaster primary residences or 
        whose predisaster primary residences are rendered uninhabitable 
        as a result of damage caused by a major disaster.
          ``(2) Determination of appropriate types of assistance.--The 
        President shall determine appropriate types of housing 
        assistance to be provided to disaster victims under this 
        section based upon considerations of cost effectiveness, 
        convenience to disaster victims, and such other factors as the 
        President may consider appropriate. One or more types of 
        housing assistance may be made available, based on the 
        suitability and availability of the types of assistance, to 
        meet the needs of disaster victims in the particular disaster 
        situation.
  ``(c) Types of Housing Assistance.--
          ``(1) Temporary housing.--
                  ``(A) Financial assistance.--
                          ``(i) In general.--The President may provide 
                        financial assistance under this section to 
                        individuals or households to rent alternate 
                        housing accommodations, existing rental units, 
                        manufactured housing, recreational vehicles, or 
                        other readily fabricated dwellings.
                          ``(ii) Amount.--The amount of assistance 
                        under clause (i) shall be based on the fair 
                        market rent for the accommodation being 
                        furnished plus the cost of any transportation, 
                        utility hookups, or unit installation not being 
                        directly provided by the President.
                  ``(B) Direct assistance.--
                          ``(i) In general.--The President may also 
                        directly provide under this section housing 
                        units, acquired by purchase or lease, to 
                        individuals or households who, because of a 
                        lack of available housing resources, would be 
                        unable to make use of the assistance provided 
                        under subparagraph (A).
                          ``(ii) Period of assistance.--The President 
                        may not provide direct assistance under clause 
                        (i) with respect to a major disaster after the 
                        expiration of the 18-month period beginning on 
                        the date of the declaration of the major 
                        disaster by the President, except that the 
                        President may extend such period if the 
                        President determines that due to extraordinary 
                        circumstances an extension would be in the 
                        public interest.
                          ``(iii) Collection of rental charges.--After 
                        the expiration of the 18-month period referred 
                        to in clause (ii), the President may charge 
                        fair market rent for the accommodation being 
                        provided.
          ``(2) Repairs.--The President may provide financial 
        assistance for the repair of owner-occupied private residences, 
        utilities, and residential infrastructure (such as private 
        access routes) damaged by a major disaster to a habitable or 
        functioning condition. A recipient of assistance provided under 
        this paragraph need not show that the assistance can be met 
        through other means, except insurance proceeds, if the 
        assistance is used for emergency repairs to make a private 
        residence habitable and does not exceed $5,000 (based on fiscal 
        year 1998 constant dollars).
          ``(3) Replacement.--The President may provide financial 
        assistance for the replacement of owner-occupied private 
        residences damaged by a major disaster. Assistance provided 
        under this paragraph shall not exceed $10,000 (based on fiscal 
        year 1998 constant dollars). The President may not waive any 
        provision of Federal law requiring the purchase of flood 
        insurance as a condition for thereceipt of Federal disaster 
assistance with respect to assistance provided under this paragraph.
          ``(4) Permanent housing construction.--The President may 
        provide financial assistance or direct assistance under this 
        section to individuals or households to construct permanent 
        housing in insular areas outside the continental United States 
        and other remote locations in cases in which--
                  ``(A) no alternative housing resources are available; 
                and
                  ``(B) the types of temporary housing assistance 
                described in paragraph (1) are unavailable, infeasible, 
                or not cost effective.
  ``(d) Terms and Conditions Relating to Housing Assistance.--
          ``(1) Sites.--Any readily fabricated dwelling provided under 
        this section shall, whenever possible, be located on a site 
        complete with utilities, and shall be provided by the State or 
        local government, by the owner of the site, or by the occupant 
        who was displaced by the major disaster. Readily fabricated 
        dwellings may be located on sites provided by the President if 
        the President determines that such sites would be more 
        economical or accessible.
          ``(2) Disposal of units.--
                  ``(A) Sale to occupants.--
                          ``(i) In general.--Notwithstanding any other 
                        provision of law, a temporary housing unit 
                        purchased under this section by the President 
                        for the purposes of housing disaster victims 
                        may be sold directly to the individual or 
                        household who is occupying the unit if the 
                        individual or household needs permanent 
                        housing.
                          ``(ii) Sales price.--Sales of temporary 
                        housing units under clause (i) shall be 
                        accomplished at prices that are fair and 
                        equitable.
                          ``(iii) Deposit of proceeds.--Notwithstanding 
                        any other provision of law, the proceeds of a 
                        sale under clause (i) shall be deposited into 
                        the appropriate Disaster Relief Fund account.
                          ``(iv) Use of gsa services.--The President 
                        may use the services of the General Services 
                        Administration to accomplish a sale under 
                        clause (i).
                  ``(B) Other methods of disposal.--
                          ``(i) Sale.--If not disposed of under 
                        subparagraph (A), a temporary housing unit 
                        purchased by the President for the purposes of 
                        housing disaster victims may be resold.
                          ``(ii) Disposal to governments and voluntary 
                        organizations.--A temporary housing unit 
                        described in clause (i) may also be sold, 
                        transferred, donated, or otherwise made 
                        available directly to a State or other 
                        governmental entity or to a voluntary 
                        organization for the sole purpose of providing 
                        temporary housing to disaster victims in major 
                        disasters and emergencies if, as a condition of 
                        such sale, transfer, or donation, the State, 
                        other governmental agency, or voluntary 
                        organization agrees to comply with the 
                        nondiscrimination provisions of section 308 and 
                        to obtain and maintain hazard and flood 
                        insurance on the housing unit.
  ``(e) Financial Assistance To Address Other Needs.--
          ``(1) Medical, dental, and funeral expenses.--The President, 
        in consultation with the Governor of the affected State, may 
        provide financial assistance under this section to an 
        individual or household adversely affected by a major disaster 
        to meet disaster-related medical, dental, and funeral expenses.
          ``(2) Personal property, transportation, and other 
        expenses.--The President, in consultation with the Governor of 
        the affected State, may provide financial assistance under this 
        section to an individual or household described in paragraph 
        (1) to address personal property, transportation, and other 
        necessary expenses or serious needs resulting from the major 
        disaster.
  ``(f) State Role.--The President shall provide for the substantial 
and ongoing involvement of the affected State in administering the 
assistance under this section.
  ``(g) Maximum Amount of Assistance.--No individual or household shall 
receive financial assistance greater than $25,000 under this section 
with respect to a single major disaster. Such limit shall be adjusted 
annually to reflect changes in the Consumer Price Index for all Urban 
Consumers published by the Department of Labor.
  ``(h) Issuance of Regulations.--The President shall issue rules and 
regulations to carry out the program, including criteria, standards, 
and procedures for determining eligibility for assistance.''.
  (b) Conforming Amendment.--Section 502(a)(6) (42 U.S.C. 5192(a)(6)) 
is amended by striking ``temporary housing''.
  (c) Elimination of Individual and Family Grant Programs.--Title IV 
(42 U.S.C. 5170-5189a) is amended by striking section 411 (42 U.S.C. 
5178).
  (d) Effective Date.--The amendments made by this section shall take 
effect on the 545th day following the date of enactment of this Act.

SEC. 204. REPEALS.

  (a) Community Disaster Loans.--Section 417 (42 U.S.C. 5184) is 
repealed.
  (b) Simplified Procedure.--Section 422 (42 U.S.C. 5189) is repealed.

SEC. 205. STATE ADMINISTRATION OF HAZARD MITIGATION PROGRAM.

  Section 404 (42 U.S.C. 5170c) is amended by adding at the end the 
following:
  ``(c) Program Administration by States.--
          ``(1) In general.--A State desiring to administer the hazard 
        mitigation assistance program established by this section with 
        respect to hazard mitigation assistance in the State may submit 
        to the President an application for the delegation of such 
        authority.
          ``(2) Criteria.--The President, in consultation with States 
        and local governments, shall establish criteria for the 
        approval of applications submitted under paragraph (1). The 
        criteria shall include, at a minimum, the following:
                  ``(A) The demonstrated ability of the State to manage 
                the grant program under this section.
                  ``(B) Submission of the plan required under section 
                201(c).
                  ``(C) A demonstrated commitment to mitigation 
                activities.
          ``(3) Approval.--The President shall approve an application 
        submitted under paragraph (1) that meets the criteria 
        established under paragraph (2).
          ``(4) Withdrawal of approval.--If, after approving an 
        application of a State submitted under paragraph (1), the 
        President determines that the State is not administering the 
        hazard mitigation assistance program established by this 
        section in a manner satisfactory to the President, the 
        President shall withdraw such approval.
          ``(5) Audits.--The President shall provide for periodic 
        audits of the hazard mitigation assistance programs 
        administered by States under this subsection.''.

SEC. 206. STATE ADMINISTRATION OF DAMAGED FACILITIES PROGRAM.

  (a) Pilot Program.--In cooperation with States and local governments 
and in coordination with efforts to streamline the delivery of disaster 
relief assistance, the President shall conduct a pilot program for the 
purpose of determining the desirability of State administration of 
parts of the assistance program established by section 406 of the 
Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 
U.S.C. 5172).
  (b) State Participation.--
          (1) Criteria.--The President may establish criteria in order 
        to ensure the appropriate implementation of the pilot program 
        under subsection (a).
          (2) Minimum number of states.--The President shall conduct 
        the pilot program under subsection (a) in at least 2 States.
  (c) Report.--Not later than 3 years after the date of enactment of 
this Act, the President shall transmit to Congress a report describing 
the results of the pilot program conducted under subsection (a), 
including identifying any administrative or financial benefits. Such 
report shall also include recommendations on the conditions, if any, 
under which States should be allowed the option to administer parts of 
the assistance program under section 406 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act (42 U.S.C. 5172).

SEC. 207. STUDY REGARDING COST REDUCTION.

  Not later than 3 years after the date of enactment of this Act, the 
Comptroller General of the United States shall conduct a study to 
estimate the reduction in Federal disaster assistance that has resulted 
and is likely to result from the enactment of this Act.

SEC. 208. REPORT ON ASSISTANCE TO RURAL COMMUNITIES.

  Not later than 180 days after the date of enactment of this Act, the 
Director of the Federal Emergency Management Agency shall prepare and 
transmit to Congress a report on methods and procedures that the 
Director recommends to accelerate the provision of Federal disaster 
assistance under the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5121 et seq.) to rural communities.

SEC. 209. STUDY REGARDING INSURANCE FOR PUBLIC INFRASTRUCTURE.

  The Comptroller General of the United States shall conduct a study to 
determine the current and future expected availability of disaster 
insurance for public infrastructure eligible for assistance under 
section 406 of the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act (42 U.S.C. 5170).

                        TITLE III--MISCELLANEOUS

SEC. 301. TECHNICAL CORRECTION OF SHORT TITLE.

  The first section (42 U.S.C. 5121 note) is amended to read as 
follows:

``SECTION 1. SHORT TITLE.

  ``This Act may be cited as the `Robert T. Stafford Disaster Relief 
and Emergency Assistance Act'.''.

SEC. 302. DEFINITION OF STATE.

  Section 102 (42 U.S.C. 5122) is amended in each of paragraphs (3) and 
(4) by striking ``the Northern'' and all that follows through ``Pacific 
Islands'' and inserting ``and the Commonwealth of the Northern Mariana 
Islands''.

SEC. 303. FIRE SUPPRESSION GRANTS.

  Section 420 (42 U.S.C. 5187) is amended by inserting ``and local 
government'' after ``State''.

                          Purpose and Summary

    The purpose of H.R. 707, the ``Disaster Mitigation and Cost 
Reduction Act of 1999,'' is to amend the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act to authorize 
programs for predisaster mitigation, to streamline the 
administration of disaster relief, and to control the Federal 
costs of disaster assistance. The bill authorizes a pre-
disaster mitigation program through fiscal year 2000. The bill 
also streamlines and modifies existing disaster assistance 
programs.

                  Background and Need for Legislation

                              Introduction

    The Disaster Mitigation and Cost Reduction Act of 1999 
addresses two separate needs: increasing pre-disaster hazard 
mitigation activities and reducing the cost of providing post-
disaster assistance. The bill establishes a federally funded 
pre-disaster hazard mitigation program and authorizes $105 
million over two years for helping fund cost-effective hazard 
mitigation activities. In addition, the bill increases the 
authorization for post-disaster mitigation funding by 33 
percent (specifically, by increasing section 404's eligible 
available funding level from 15 percent to 20 percent of the 
total amount of disaster assistance provided). The bill also 
adopts measures that will modify and streamline the current 
post-disaster assistance program with the intention of reducing 
federal disaster assistance costs without adversely affecting 
disaster victims.
    The costs of natural disasters are increasing very rapidly. 
In the last five years, the nation has been fortunate to avoid 
a major hurricane or earthquake, yet in that time over 800 
people have been killed by natural disasters. These disasters 
also inflicted over $60 billion in property losses and other 
damage. The data indicate these losses are likely to increase. 
For the ten-year period prior to 1989, total obligations from 
the Federal Emergency Management Agency's (FEMA's) Disaster 
Relief Fund were $4 billion; since 1989, FEMA has spent $21 
billion. Prior to 1989, only one disaster event (Hurricane 
Agnes in 1972) cost over $500 million in FEMA funds. Since 
1989, every year, except 1991, has had at least one disaster 
event costing more than $500 million in FEMA assistance. In 
fact, six of these events have occurred since 1993.

                           Hazard Mitigation

    There are two primary ways to reduce the cost of natural 
disasters. One is to take measures that reduce our nation's 
vulnerability to hazards, also known as hazard mitigation. 
Historically, federal, state, and local governments have 
focused on assisting the victims of disasters after the damage 
is done. As the cost of the damages and assistance have 
increased, however, governments have started to change their 
spending priorities. Between 1992 and 1996, a period of only 
four years, state spending on mitigation measures increased by 
more than four fold to an average of $16 million per state. 
Realizing that the only way to control post-disaster spending 
for response, relief, and recovery is to increase pre-disaster 
funding for mitigation, planning and preparedness, states now 
spend as much money on preparing for a disaster as they do in 
its aftermath. In contrast, the federal government still spends 
three dollars on post-disaster assistance for every dollar it 
spends on mitigation (including the maintenance of flood 
control structures such as levees and dams).
    Private insurers are also aware of the need for hazard 
mitigation. Funded through the Institute for Building and Home 
Safety, private insurers recently established the ``Showcase 
Communities'' program to demonstrate the benefits of taking 
specific, creative steps within an entire community to reduce 
the losses caused by natural disasters. States such as New York 
and Florida are implementing similar programs. FEMA also 
sponsors such a program called Project Impact. The goal of 
Project Impact is to bring communities together to take actions 
that prepare for--and protect themselves against--natural 
disaster in a collaborative effort. Over 100 communities have 
been designated Project Impact sites.

                    Streamlining and Cost Reduction

    Other than hazard mitigation, the costs of disasters can be 
reduced by making current disaster programs more efficient. The 
bill attempts to increase the efficiency of existing disaster 
assistance programs by eliminating unnecessary and complicated 
aspects of the program. This includes streamlining the 
management cost reimbursement requirements (section 201) and 
combining the housing, and individual and family assistance 
programs (section 203). In addition, the bill would condition 
infrastructure assistance offered to private-nonprofit 
organizations not providing critical services on their applying 
to the Small Business Administration for a disaster assistance 
loan (section 202). This requirement mimics a requirement 
already in place for individuals or families seeking federal 
disaster grant assistance.

                               Conclusion

    The expectation is that the two themes of this bill--
greater emphasis on mitigation and greater program efficiency--
will reduce the costs natural disasters place on the nation. To 
help Congress determine whether the bill achieves this 
objective, the bill includes a provision (section 207) 
requiring that three years from enactment, the General 
Accounting Office estimate the cost savings resulting from 
these amendments.

      Discussion of Committee Bill and Section-by-Section Analysis

                 title i--predisaster hazard mitigation

Section 101. Findings and purpose

    Describes findings and a purpose applicable to Title I of 
the bill.
    Subsection (a) makes four findings: (1) greater emphasis 
needs to be placed on hazard identification and hazard 
mitigation, (2) expenditures for disaster assistance are 
increasing without any reduction in the likelihood of future 
losses, (3) a high priority should be placed on the 
implementation of predisaster hazard mitigation activities, and 
(4) a unified effort of economic incentives, awareness and 
education, technical assistance, and Federal support will 
enable states and local communities to form partnerships and 
implement effective mitigation measures that will reduce the 
risk of future damage to life and property. In preparing hazard 
mitigation programs the bill's findings recognize the 
importance for states and local communities to identify those 
long-term predisaster mitigation measures (including 
construction practices and materials) in new and existing 
structures. Additionally, a unified support effort will ensure 
that critical facilities and public infrastructure are able to 
function after a disaster strikes.
    Subsection (b) states the purpose of Title I of the bill. 
The purpose is to (1) establish a program to reduce the loss of 
life, property, and other costs of disasters and (2) provide a 
source of predisaster mitigation funding to assist states and 
local governments in implementing mitigation measures.

Section 102. State mitigation program

    Amends subsection 201(c) of the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act (Stafford Act) to require, 
as a condition for receiving federal grants under such section, 
that states submit to the President a comprehensive program for 
mitigating against disasters, including provisions for 
prioritizing mitigation activities. An important part of this 
program are provisions for prioritizing mitigation measures. A 
key aspect of a successful mitigation program is focusing 
resources on those activities that result in the greatest 
benefits. The state programs must include a method for 
identifying such activities.
    This reporting requirement is not intended to duplicate or 
conflict with any existing reporting requirements currently 
submitted to the President by state governments including so-
called ``409 Reports'' (reports currently required by FEMA 
under the authority of section 409 of the Stafford Act). 
Consistent with the Paperwork Reduction Act of 1986, this 
provision is intended to be implemented so that the minimum 
burden is placed on states in fulfilling this new reporting 
requirement.

Section 103. Disaster assistance plans

    Amends subsection 201(d) of the Stafford Act to authorize 
grants for the testing and application of floodplain mapping 
technologies that the President determines will likely result 
in substantial savings over current floodplain mapping methods. 
The Committee notes that many floodplain maps are out of date 
or of poor quality and that new technologies are available that 
can produce extremely accurate maps at much less cost than in 
the past.

Section 104. Predisaster hazard mitigation

    Creates a new section 203 in the Stafford Act, with the 
following subsections:
    (a) General Authority.--Provides the legislative authority 
for pre-disaster mitigation grants from the President to state 
and local governments.
    (b) Purposes of Assistance.--Grants are primarily intended 
to fund activities that are cost-effective and substantially 
reduce the risk of future damage, hardship, or suffering from a 
major disaster. These activities include any work directly 
related to the activity needed to meet federal requirements 
such as, but not limited to, environmental or benefit-cost 
analyses. State or local governments may spend up to 10 percent 
of federal assistance to fund activities to disseminate 
information regarding cost-effective mitigation technologies. 
The Committee urges communities to examine technologies which 
have proven to be effective in mitigating the risks or impacts 
of actual natural disasters. This would include construction 
practices and materials such as passive design systems for 
roofs, walls and windows.
    (c) Allocation of Funds.--All eligible states shall receive 
assistance. No state would receive less than the lesser of 
$500,000 or 1 percent of the total funds appropriated for these 
grants in a given fiscal year. No state would receive more than 
15 percent of total funds appropriated for these grants in a 
given fiscal year.
    (d) Criteria.--In deciding who to award grants to (and the 
amount of such grants), the President must consider seven 
criteria in addition to any other criteria the President may 
establish: (1) clear identification of cost-effective 
mitigation activities that produce meaningful and definable 
outcomes, (2) whether the state has submitted a mitigation 
program as required under section 201(c) as amended, (3) the 
extent to which assistance will fund activities that mitigate 
hazards evaluated under Section 409, (4) the opportunity to 
fund activities that maximize net benefits to society, (5) the 
ability of the state or local government to fund mitigation 
activities, (6) whether the assistance helps a small 
impoverished community, and (7) the level of interest of the 
private sector in entering into a partnership to promote 
mitigation.
    In addition, it is the Committee's expectation that the 
number of additional factors, if any, that may be established 
by the President will be small so that these factors will 
continue to be important in controlling how funds are 
allocated. The Committee encourages the President to establish 
an analytical system for ranking possible candidates by these 
criteria including appropriate weighting of the factors. As an 
example, the Environmental Protection Agency has established 
such a system for allocating grants under section 319 of the 
Clean Water Act.
    The Committee further notes that the second criterion, 
consistency with a state mitigation program submitted in 
cooperation with local governments, should include 
consideration of the cooperation exhibited between the relevant 
city and county governments. Conflict between local governments 
may indicate a problem that may need to be addressed further 
before funding is provided.
    (e) State Nominations.--Every year, states may nominate 
five or more local governments to the President for predisaster 
mitigation assistance. The President must select from such 
nominations unless the President determines extraordinary 
circumstances justify selecting another site (for instance, if 
the state's nominees rank low on all or most of the criteria 
delineated in subsection (d) compared to other communities in 
the state, or if a state's nominees are on probation for 
violations in the flood insurance program). If a state does not 
submit nominations in a timely fashion, the President may 
provide assistance to any local governments in the state using 
the criteria established in subsection (d).
    (f) Small Impoverished Communities.--Small impoverished 
communities are defined as communities of 3,000 or fewer 
individuals that are economically disadvantaged. In developing 
a definition to implement this provision, the Committee 
suggests the President use, as a starting point, the definition 
of small impoverished communities established to implement the 
Hardship Grants Program for Rural Communities contained in the 
Omnibus and Appropriations Act of 1996 (P.L. 104-134) (see 62 
Federal Register 13521, March 20, 1997, for more information).
    (g) Federal Share.--The grants may cover up to 75 percent 
of the cost of mitigation proposals funded by the President. 
Grants for small impoverished communities may cover up to 90 
percent of the cost of mitigation activities.
    (h) Authorization.--There is authorized to be appropriated 
for implementing this section $25 million for fiscal year 1999, 
and $80 million for fiscal year 2000.
    (i) Authorization of Section 404 Funds.--Effective October 
1, 2000, in addition to amounts appropriated under subsection 
(h) from only appropriations enacted after October 1, 2000, 
funds appropriated under section 404 of the Stafford Act (post-
disaster mitigation grants) that are not obligated within 30 
months of the disaster which triggered their initial 
appropriation, may be used for the predisaster mitigation 
program authorized by this section. The Committee notes that 
these funds remain available to both the 404 and the 
predisaster mitigation program. The availability of these funds 
for predisaster mitigation does not foreclose their use for the 
originally intended purpose. The Committee encourages FEMA to 
use such funding under the 404 program if the obligation of 
such funds is imminent. The redirection of these funds is not 
mandatory. The Committee also expects FEMA to segregate funds 
appropriated before FY 2000 to ensure this section does not 
affect previously appropriated funds.
    (j) Report on State Administration.--Within 18 months of 
the enactment of this Act, the President shall submit a report 
to Congress (1) evaluating the implementation of this section 
and (2) recommending a process for transferring greater 
authority and responsibility for administering the predisaster 
mitigation program to capable state governments. Understanding 
that mitigation efforts must be local, the Committee intends 
that, as state capabilities improve, this program should be 
increasingly delegated to the states. In the future it may be 
desirable to modify the statutory provisions of this program to 
facilitate an expanded role for State and local governments to 
administer this program. The Committee considers the increasing 
state administration of the post-disaster mitigation program 
under section 404 as evidence that states will be capable of 
administering this program, as well.

Section 105. Interagency task force

    Directs the President to establish an interagency task 
force, chaired by FEMA, for the purpose of coordinating the 
implementation of the predisaster mitigation program. The 
Committee notes the possibility of overlap of this program with 
other programs implemented by other agencies. The task force 
should ensure this program and the other programs are 
complementary and integrated.

Section 106. Maximum contribution for mitigation costs

    Increases the authorization for post-disaster mitigation 
funding from 15 percent of the estimated aggregate amount of 
assistance provided under the Stafford Act for a Major Disaster 
to 20 percent of the amount of such assistance.

Section 107. Conforming amendment

    Adds the term ``Mitigation'' to title II of the Stafford 
Act.

               title ii--streamlining and cost reduction

Section 201. Management costs

    Adds a new section 322 to the Stafford Act. Provides that a 
certain percentage, or rate, of management costs will be 
reimbursed. The percentages will be established by regulation. 
Management costs include any indirect, administrative, or 
associated costs or expenses currently reimbursed by FEMA 
except for National Guard, prison labor, and other labor costs 
which will be treated as eligible costs. The current 
reimbursement system will remain in effect for disasters 
declared before such rates are established. The rates would be 
reviewed by the President periodically.

Section 202. Assistance to repair, restore, reconstruct, or replace 
        damaged facilities

    Amends and reorganizes section 406 of the Stafford Act as 
follows:
    (a) Contributions.--Requires private nonprofit 
organizations which are eligible for Stafford Act permanent 
restorative assistance to apply for Small Business 
Administration (SBA) disaster loans before they can receive 
grant assistance from FEMA. This requirement does not apply if 
a facility provides critical services in the event of a major 
disaster. The term critical services includes, but is not 
limited to, power, water, sewer, wastewater treatment, 
communications and emergency medical care. It is the 
Committee's understanding that SBA is already well prepared to 
implement this provision and examine such applications without 
undue delay.
    (b) Minimum Federal Share.--Amends subsection 406(b) to 
comport with the amendment made by section 201 above.
    (c) Large In-Lieu Contributions.--Rewrites section 406(c) 
to reduce from 90 percent to 75 percent (of the otherwise 
eligible amount) the contribution of the federal share 
(henceforth ``contribution level'') available to public and 
private nonprofit entities which choose to carry out alternate 
projects following major disasters. The President is required 
to modify the 75 percent contribution level if the President 
determines another contribution level will reduce the total 
amount of federal assistance under this section. However, the 
federal share may not be set below 50 percent or higher than 90 
percent.
    The Committee intends that the level set by the President 
be generally applicable, it is not intended to be adjusted on a 
case by case basis. Further, an alternative level set by the 
President must be supported by adequate data. The Committee 
notes that the relationship between the contribution level and 
the expected federal cost is currently unknown. For purposes of 
illustration, the figure below indicates three of the many 
possible relationships between these parameters. The first 
hypothetical relationship (the curve marked ``1'') would 
indicate the President should select a contribution level at or 
slightly below the new 75 percent level. The relationship 
marked ``2'' would lead to a contribution level of 50 percent. 
The relationship marked ``3'' would result in a contribution 
level of 90 percent. It is expected that if the President 
receives data and other information of sufficient quality to 
determine that an alternative contribution level will reduce 
federal costs, the President shall adopt such a contribution 
level. The Committee does not intend that the contribution 
level be altered frequently, but that such changes be made 
after careful consideration and based on solid data. 


    (d) Eligible Cost.--Amends subsection 406(e) to allow the 
eligible cost of repair, restoration, reconstruction, or 
replacement to be based on a cost estimate rather than actual 
cost incurred. However, if the estimate differs from the actual 
cost by more than 20 percent the President may use the actual 
cost as the eligible cost. The Committee expects that estimates 
that exceed actual costs by more than 20 percent will result in 
the reimbursement of the difference to the federal government 
while estimates that underestimate actual costs by more than 20 
percent will result in additional assistance to the victim of 
the disaster to be used in the costs of repairs and development 
of methods to reduce future possible risk. This section also 
establishes a panel of experts to develop a cost estimating 
procedure. The Committee expects the panel will include 
licensed professionals from the construction industry, 
government, and academia representing metropolitan and rural 
interests from the various geographic regions in the country. 
This amendment to the Stafford Act should not affect funds 
appropriated prior to FY 2000. The Committee expects FEMA will 
segregate pre-FY 2000 funding in order to implement this 
section.
    (e) Associated Expenses.--Eliminates subsection 406(f), 
relating to associated expenses, to comport with the amendment 
made by section 201 of the bill. Subsections (3), (4), and (5) 
of 406(f) are moved into section 406(e). This should result in 
no change in the level of reimbursement for National Guard, 
prison labor, and other labor that States receive under current 
law.

Section 203. Federal assistance to individuals and households

    Amends section 408 of the Stafford Act to combine the 
Housing and Individual and Family Grant (IFG) Programs. The 
amendment sets the federal cost share for both programs at 
100%,and continues the requirement that applicants for 
individual and family grants show that assistance is not 
available by other means before seeking assistance and caps 
total assistance for the combined program at $25,000. The 
section allows the President to assist individuals by replacing 
their homes under certain conditions. Also, victims seeking 
assistance for minimal emergency home repair need only show 
that the damage is not covered by insurance in order to be 
eligible for assistance for such repairs not exceeding $5,000.
    New subsection section 408(e) authorizes grants for 
medical, dental, funeral, and other expenses that are disaster 
related. In particular, paragraph (2) of this subsection 
provides authority for the President to provide financial 
assistance to individuals or households for meeting serious 
needs resulting from a major disaster. Serious needs are 
requirements for an item or service essential to prevent, 
mitigate, or overcome a disaster-related hardship or injury. 
Such needs typically include clothing and transportation.
    New subsection 408(f) requires the President to provide for 
substantial and continuing involvement of the State in 
administering this program. Administrative and other indirect 
costs incurred by the State in implementing this section shall 
be reimbursable under the rates established in section 322 of 
the Stafford Act as amended by section 201 of this bill.

Section 204. Repeals

    Repeals section 417 of the Stafford Act (providing for 
Community Disaster Loans). Also repeals section 422 (Simplified 
Procedure) in order to conform with the amendment made under 
section 202(d) of the bill.

Section 205. State administration of hazard mitigation program

    Requires the President to establish a process for offering 
states the option of administering the Hazard Mitigation Grant 
Program (section 404) program. The President shall set the 
criteria for such a program and perform periodic audits in 
those cases where the program is administered by a state.

Section 206. State administration of damaged facilities program

    Requires the President to conduct in at least 2 states a 
pilot program allowing states to administer parts of the Public 
Assistance (section 406) program. This could include, but is 
not limited to, the state independently validating estimates, 
verifying applicants' eligibility, and/or providing technical 
assistance. The President must report on the results including 
any streamlining or cost savings that resulted from the 
program. This program is not intended to conflict with FEMA's 
current efforts to streamline the public assistance program, 
but is intended to be coordinated with such efforts.

Section 207. Study regarding cost reduction

    Directs the General Accounting Office (GAO) to estimate the 
reduction in federal disaster assistance that results from the 
enactment of this Act.

Section 208. Report on assistance for rural communities

    Directs FEMA to prepare and evaluate more efficient methods 
of providing disaster relief to rural communities.

Section 209. Study regarding insurance for public infrastructure

    Directs GAO to determine the current and future 
availability of insurance for public infrastructure.

                        TITLE III--MISCELLANEOUS

Section 301. Technical correction of short title

    Deletes the extra ``The'' from the title of the Act.

Section 302. Definition of State

    Updates the definition of ``state'' in the Stafford Act to 
comport with current law.

Section 303. Fire suppression grants

    Amends Section 420 (42 U.S.C. 5187) by inserting ``and 
local government'' after ``State'' so that local governments 
will also be eligible for fire suppression grants. Currently, 
only states are eligible for such grants.

                                Hearings

    The Committee has not held hearings on the reported 
legislation. However, in the 105th Congress, the Subcommittee 
on Water Resources and Environment held several days of 
hearings on disaster assistance and hazard mitigation including 
draft legislation substantially similar to H.R. 707.
    In the 105th Congress, the Subcommittee on Water Resources 
and Environment held hearings on the two issue areas addressed 
by the bill: hazard mitigation and the federal costs of 
disasters. On January 28, 1998, the Subcommittee held a hearing 
on hazard mitigation. Witnesses included representatives from 
FEMA, the National Emergency Management Association, Los 
Angeles County, and American Rivers. The witnesses provided 
testimony on importance of focusing more resources on pre-
disaster mitigation.
    On March 26, 1998, the Subcommittee held a hearing on the 
federal cost of disaster assistance. Witnesses included 
representatives from FEMA, the General Accounting Office, the 
National Emergency Management Association, the Association of 
State Floodplain Managers, the National League of Cities, and 
others. The witnesses generally noted the increasing costs of 
disasters and offered methods for reducing such costs.
    On March 30, 1998, a draft bill addressing these two issues 
was released for public comment. A revised draft bill 
reflecting comments received by the Subcommittee was released 
on May 1, 1998. The Subcommittee held a legislative hearing on 
the draft bill on May 7, 1998. Witnesses included FEMA, the 
National Emergency Management Association, the Association of 
State Floodplain Managers, the National League of Cities, and 
the International Association of Emergency Managers.
    The draft language was further amended and introduced as 
H.R. 3869 on May 14, 1998 by Representative Sherwood Boehlert 
and Representative Robert Borski. The bill was referred solely 
to the Committee on Transportation and Infrastructure.

                        Committee Consideration

    H.R. 707 is substantially similar to H.R. 3869, which, by 
voice vote, was reported by the Committee in the 105th 
Congress. H.R. 707 was introduced on February 11, 1999 by 
Congresswoman Tillie K. Fowler, and Congressmen James A. 
Traficant, Sherwood L. Boehlert, and, Robert A. Borski.
    On February 24, 1999, the Subcommittee on Oversight, 
Investigations, and Emergency Management favorably reported the 
bill with a technical amendment to the Full Committee by 
unanimous voice vote, a quorum being present.
    On March 2, 1999, the Full Committee adopted by voice vote 
an amendment offered by Representative Tillie Fowler modifying 
sections 104 and 202 of the bill. The amendment prohibited 
changes made by these sections from affecting funds 
appropriated prior to fiscal year 2000. The Full Committee also 
adopted by voice vote an amendment offered by Representative 
Lee Terry exempting certain private nonprofit organizations 
from having to apply to the Small Business Administration as a 
condition of receiving FEMA assistance. Subsequently, the Full 
Committee ordered reported H.R. 707, as amended, unanimously by 
voice vote, a quorum being present.

                            Roll Call Votes

    Clause 3(b) of rule XIII requires each committee report to 
include the total number of votes cast for and against on each 
roll call vote on a motion to report and on any amendment 
offered to the measure or matter, and the names of those 
members voting for and against. There were no recorded votes 
taken in connection with ordering H.R. 707 reported. A motion 
by Mrs. Tillie Fowler to order H.R. 707 reported to the House, 
with amendments, was unanimously agreed to by voice vote, a 
quorum being present.

                        Cost of the Legislation

    Clause 3(d)(2) of rule XIII of the Rules of the House of 
Representatives is satisfied where a cost estimate and 
comparison prepared by the Director of the Congressional Budget 
Office (CBO) under section 402 of the Congressional Budget Act 
of 1974 has been timely submitted prior to the filing of the 
report and is included in the report. The Committee has 
received no cost estimate and comparison. When available it 
will be printed in the Congressional Record.
    The Committee estimates that implementing H.R. 707 would 
result in a reduction in discretionary outlays of $109 million 
over the 2000--2004 period. This estimate is based on the cost 
estimate provided by CBO for H.R. 3869 which was reported out 
of the Committee in the 105th Congress and is substantially 
similar to H.R. 707. The Committee has modified the estimate to 
reflect changes between H.R. 707 and H.R. 3869 which are 
discussed in detail below. In addition the Committee has 
estimated that each $1 spent on mitigation will result, on 
average, in $1 in savings. The Committee considers this a 
conservative estimate because, as described below, FEMA 
estimates mitigation measures return $3 for each $1 invested. 
However, the Committee also recognizes the time horizon for 
such a return is on the order of 10 to 20 years and, therefore, 
concludes that a $1 for $1 estimate may be a more accurate 
estimate of the return over the next several years. As noted 
below, CBO did not attempt to estimate any savings from 
mitigation activities authorized by the bill. A summary of the 
calculation of the Committee's cost estimate is shown in the 
table below:

                        [In millions of dollars]

        Line Item                                                 Amount
CBO estimate for H.R. 3869........................................  -600
Reduction in authorization level in H.R. 707......................   +95
Exemption for certain nonprofits under section 202(a).............    -6
Assume $1 in savings for every $1 in mitigation spending (not 
    estimated by CBO).............................................  +620
                        -----------------------------------------------------------------
                        ________________________________________________
    Total Savings.................................................  $109

There are three significant differences between H.R. 3869 and 
H.R. 707 that the Committee took into consideration in 
modifying the CBO cost estimate for H.R. 3869 to reflect H.R. 
707.
    First, the authorization levels for the pre-disaster 
mitigation program have been reduced by $95 million. This would 
reduce the overall cost of the bill by this amount.
    Second, the CBO cost estimate for H.R. 3869 concluded that 
section 104 of H.R. 3869 (similar to section 104 of H.R. 707) 
would result in an effect on direct spending by speeding up the 
disbursement of some existing disaster relief funds. H.R. 707 
has been modified by the Committee to eliminate any effect on 
direct spending.
    Finally, an amendment adopted by the Committee exempting 
certain private nonprofit organizations from having to apply to 
the Small Business Administration for a loan as a condition of 
receiving assistance (section 202(a) of H.R. 3869 and H.R. 707) 
is expected to increase the cost of the bill by $3 million to 
$9 million a year compared to H.R. 3869.
    The Committee notes that subsequent review of the CBO cost 
estimate for H.R. 3869 indicates that section 202(d) of H.R 
3869 (similar to section 202(d) of H.R. 707) could also have 
been interpreted to affect direct spending. The Committee has 
modified H.R. 707 to eliminate this potential effect.
    As the Committee noted last year the CBO estimate 
explicitly omited significant benefits of the legislation 
because CBO was unable to quantify these benefits. For 
instance:
    CBO did not quantify the benefits of mitigation activities 
(which CBO notes ``could lead to substantial savings'') because 
``we cannot predict either the frequency or incidence of major 
natural disasters.'' The Committee believes these benefits will 
be significant. On May 7, 1998 the Federal Emergency Management 
Agency testified that mitigation measures return $3 for every 
$1 spent. Further, the bill requires that all mitigation 
activities be cost-effective.
    CBO was unable to quantify administrative cost reductions 
resulting from combining the Housing, and Individual and Family 
grant programs under section 203 of the bill. CBO states this 
provision is ``likely to result in some savings'' but ``CBO has 
no basis for estimating the likely amount of such savings.'' 
The Committee believes the savings may be significant. FEMA 
estimated the savings of a similar provision at $700 million 
over 5 years.
    The Committee is assuming each dollar spent on mitigation 
will result in at least one dollar in savings. The Committee is 
not attempting to estimate any savings from administrative cost 
reductions and, therefore, considers this a conservative 
estimate of the bill's savings.

                    Compliance With House Rule XIII

    1. Pursuant to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives, oversight findings and 
recommendations have been made by the Committee as reflected in 
this report.
    2. With respect to the requirement of clause 3(c)(2) of 
rule XIII of the Rules of the House of Representatives, and 
308(a) of the Congressional Budget Act of 1974, the Committee 
references the report of the Congressional Budget Office has 
not been received. When available, it will be printed in the 
Congressional Record.
    3. With respect to the requirement of clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, the 
Committee has received no report of oversight findings and 
recommendations from the Committee on Government Reform on the 
subject of H.R. 707.
    4. With respect to the requirement of clause 3(c)(3) of 
rule XIII of the Rules of the House of Representatives and 
section 402 of the Congressional Budget Act of 1974, a cost 
estimate from the Director of the Congressional Budget Office 
(CBO) is not available.

                   Constitutional Authority Statement

    Pursuant to clause 3(d)(1) of rule XIII of the Rules of the 
House of Representatives, committee reports on a bill or joint 
resolution of a public character shall include a statement 
citing the specific powers granted to the Congress in the 
Constitution to enact the measure. The Committee on 
Transportation and Infrastructure finds that Congress has the 
authority to enact this measure pursuant to its powers granted 
under article I, section 8 of the Constitution.

                       Federal Mandates Statement

    Pursuant to section 423 of the Unfunded Mandates Reform Act 
(P.L. 104-4), the Committee finds that H.R. 707 imposes no 
federal mandates.

                      Advisory Committee Statement

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act were created by this 
legislation.

                Applicability to the Legislative Branch

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (P.L. 104-1).

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

  THE ROBERT T. STAFFORD DISASTER RELIEF AND EMERGENCY ASSISTANCE ACT

  Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, [That this 
Act may be cited as the ``The Robert T. Stafford Disaster 
Relief and Emergency Assistance Act''.]

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Robert T. Stafford Disaster 
Relief and Emergency Assistance Act''.

           *       *       *       *       *       *       *


TITLE I--FINDINGS, DECLARATIONS, AND DEFINITIONS

           *       *       *       *       *       *       *


                              definitions

  Sec. 102. As used in this Act--
          (1) * * *

           *       *       *       *       *       *       *

          (3) ``United States'' means the fifty States, the 
        District of Columbia, Puerto Rico, the Virgin Islands, 
        Guam, American Samoa, [the Northern Mariana Islands, 
        and the Trust Territory of the Pacific Islands] and the 
        Commonwealth of the Northern Mariana Islands.
          (4) ``State'' means any State of the United States, 
        the District of Columbia, Puerto Rico, the Virgin 
        Islands, Guam, American Samoa, [the Northern Mariana 
        Islands, and the Trust Territory of the Pacific 
        Islands] and the Commonwealth of the Northern Mariana 
        Islands.

           *       *       *       *       *       *       *


              [TITLE II--DISASTER PREPAREDNESS ASSISTANCE]

        TITLE II_DISASTER PREPAREDNESS AND MITIGATION ASSISTANCE

            federal and state disaster preparedness programs

  Sec. 201. (a) * * *

           *       *       *       *       *       *       *

  (c) Upon application by a State, the President is authorized 
to make grants, not to exceed in the aggregate to such State 
$250,000, for the development of plans, programs, and 
capabilities for disaster preparedness and prevention. Such 
grants shall be applied for within one year from the date of 
enactment of this Act. Any State desiring financial assistance 
under this section shall designate or create an agency to plan 
and administer such a disaster preparedness program, and shall, 
through such agency, submit a State plan to the President, 
which shall--
          (1) set forth a comprehensive and detailed State 
        program for preparation against and assistance 
        following, emergencies and major disasters, including 
        provisions for assistance to individuals, businesses, 
        and local governments; [and]
          (2) include provisions for appointment and training 
        of appropriate staffs, formulation of necessary 
        regulations and procedures and conduct of required 
        exercises[.]; and
          (3) set forth, with the ongoing cooperation of local 
        governments and consistent with section 409, a 
        comprehensive and detailed State program for mitigating 
        against emergencies and major disasters, including 
        provisions for prioritizing mitigation measures.
  [(d) The President is authorized to make grants not to exceed 
50 per centum of the cost of improving, maintaining and 
updating State disaster assistance plans, including evaluations 
of natural hazards and development of the programs and actions 
required to mitigate such hazards, except that no such grant 
shall exceed $50,000 per annum to any State.]
  (d) Grants for Disaster Assistance and Hazard 
Identification.--The President is authorized to make grants 
for--
          (1) not to exceed 50 percent of the cost of 
        improving, maintaining, and updating State disaster 
        assistance plans including, consistent with section 
        409, evaluation of natural hazards and development of 
        the programs and actions required to mitigate such 
        hazards; and
          (2) the development and application of improved 
        floodplain mapping technologies that can be used by 
        Federal, State, and local governments and that the 
        President determines will likely result in substantial 
        savings over current floodplain mapping methods.

           *       *       *       *       *       *       *


SEC. 203. PREDISASTER HAZARD MITIGATION.

  (a) General Authority.--The President may establish a program 
to provide financial assistance to States and local governments 
for the purpose of undertaking predisaster hazard mitigation 
activities that are cost effective and substantially reduce the 
risk of future damage, hardship, or suffering from a major 
disaster.
  (b) Purpose of Assistance.--
          (1) In general.--Except as provided in paragraph (2), 
        a State or local government that receives financial 
        assistance under this section shall use the assistance 
        for funding activities that are cost effective and 
        substantially reduce the risk of future damage, 
        hardship, or suffering from a major disaster.
          (2) Dissemination.--The State or local government may 
        use not more than 10 percent of financial assistance it 
        receives under this section in a fiscal year for 
        funding activities to disseminate information regarding 
        cost effective mitigation technologies (such as 
        preferred construction practices and materials), 
        including establishing and maintaining centers for 
        protection against natural disasters to carry out such 
        dissemination.
  (c) Allocation of Funds.--The amount of financial assistance 
to be made available to a State, including amounts made 
available to local governments of such State, under this 
section in a fiscal year shall--
          (1) not be less than the lesser of $500,000 or 1.0 
        percent of the total funds appropriated to carry out 
        this section for such fiscal year; but
          (2) not exceed 15 percent of such total funds.
  (d) Criteria.--Subject to the limitations of subsections (c) 
and (e), in determining whether to provide assistance to a 
State or local government under this section and the amount of 
such assistance, the President shall consider the following 
criteria:
          (1) The clear identification of prioritized cost-
        effective mitigation activities that produce meaningful 
        and definable outcomes.
          (2) If the State has submitted a mitigation program 
        in cooperation with local governments under section 
        201(c), the degree to which the activities identified 
        in paragraph (1) are consistent with the State 
        mitigation program.
          (3) The extent to which assistance will fund 
        activities that mitigate hazards evaluated under 
        section 409.
          (4) The opportunity to fund activities that maximize 
        net benefits to society.
          (5) The ability of the State or local government to 
        fund mitigation activities.
          (6) The extent to which assistance will fund 
        mitigation activities in small impoverished 
        communities.
          (7) The level of interest by the private sector to 
        enter into a partnership to promote mitigation.
          (8) Such other criteria as the President establishes 
        in consultation with State and local governments.
  (e) State Nominations.--
          (1) In general.--The Governor of each State may 
        recommend to the President not less than 5 local 
        governments to receive assistance under this section. 
        The recommendations shall be submitted to the President 
        not later than October 1, 1999, and each October 1st 
        thereafter or such later date in the year as the 
        President may establish. In making such 
        recommendations, the Governors shall consider the 
        criteria identified in subsection (d).
          (2) Use.--
                  (A) General rule.--In providing assistance to 
                local governments under this section, the 
                President shall select from local governments 
                recommended by the Governors under this 
                subsection.
                  (B) Waiver.--Upon request of a local 
                government, the President may waive the 
                limitation in subparagraph (A) if the President 
                determines that extraordinary circumstances 
                justify the waiver and that granting the waiver 
                will further the purpose of this section.
          (3) Effect of failure to nominate.--If a Governor of 
        a State fails to submit recommendations under this 
        subsection in a timely manner, the President may 
        select, subject to the criteria in subsection (d), any 
        local governments of the State to receive assistance 
        under this section.
  (f) Small Impoverished Communities.--For the purpose of this 
section, the term ``small impoverished communities'' means 
communities of 3,000 or fewer individuals that are economically 
disadvantaged, as determined by the State in which the 
community is located and based on criteria established by the 
President.
  (g) Federal Share.--Financial assistance provided under this 
section may contribute up to 75 percent of the total cost of 
mitigation activities approved by the President; except that 
the President may contribute up to 90 percent of the total cost 
of mitigation activities in small impoverished communities.
  (h) Authorization of Appropriations.--There is authorized to 
be appropriated to carry out this section $25,000,000 for 
fiscal year 1999 and $80,000,000 for fiscal year 2000.
  (i) Authorization of Section 404 Funds.--Effective October 1, 
2000, in addition to amounts appropriated under subsection (h) 
from only appropriations enacted after October 1, 2000, the 
President may use, to carry out this section, funds that are 
appropriated to carry out section 404 for post-disaster 
mitigation activities that have not been obligated within 30 
months of the disaster declaration upon which the funding 
availability is based.
  (j) Report on Federal and State Administration.--Not later 
than 18 months after the date of enactment of the Disaster 
Mitigation and Cost Reduction Act of 1999, the President, in 
consultation with State and local governments, shall transmit 
to Congress a report evaluating efforts to implement this 
section and recommending a process for transferring greater 
authority and responsibility for administering the assistance 
program authorized by this section to capable States.

TITLE III--MAJOR DISASTER AND EMERGENCY ASSISTANCE ADMINISTRATION

           *       *       *       *       *       *       *


SEC. 322. MANAGEMENT COSTS.

  (a) In General.--Notwithstanding any other provision of law 
(including any administrative rule or guidance), the President 
shall establish by rule management cost rates for grantees and 
subgrantees. Such rates shall be used to determine 
contributions under this Act for management costs.
  (b) Management Costs Defined.--Management costs include 
indirect costs, administrative expenses, associated expenses, 
and anyother expenses not directly chargeable to a specific 
project under a major disaster, emergency, or emergency preparedness 
activity or measure. Such costs include the necessary costs of 
requesting, obtaining, and administering Federal assistance and costs 
incurred by a State for preparation of damage survey reports, final 
inspection reports, project applications, final audits, and related 
field inspections by State employees, including overtime pay and per 
diem and travel expenses of such employees, but not including pay for 
regular time of such employees.
  (c) Review.--The President shall review the management cost 
rates established under subsection (a) not later than 3 years 
after the date of establishment of such rates and periodically 
thereafter.

           *       *       *       *       *       *       *


TITLE IV--MAJOR DISASTER ASSISTANCE PROGRAMS

           *       *       *       *       *       *       *


SEC. 404. HAZARD MITIGATION.

  (a) In General.--The President may contribute up to 75 
percent of the cost of hazard mitigation measures which the 
President has determined are cost-effective and which 
substantially reduce the risk of future damage, hardship, loss, 
or suffering in any area affected by a major disaster. Such 
measures shall be identified following the evaluation of 
natural hazards under section 409 and shall be subject to 
approval by the President. The total of contributions under 
this section for a major disaster shall not exceed [15 percent] 
20 percent of the estimated aggregate amount of grants to be 
made (less any associated administrative costs) under this Act 
with respect to the major disaster.

           *       *       *       *       *       *       *


SEC. 406. REPAIR, RESTORATION, AND REPLACEMENT OF DAMAGED FACILITIES.

  [(a) Contributions.--The President may make contributions--
          [(1) to a State or local government for the repair, 
        restoration, reconstruction, or replacement of a public 
        facility which is damaged or destroyed by a major 
        disaster and for associated expenses incurred by such 
        government; and
          [(2) to a person who owns or operates a private 
        nonprofit facility damaged or destroyed by a major 
        disaster for the repair, restoration, reconstruction, 
        or replacement of such facility and for associated 
        expenses incurred by such person.
  [(b) Minimum Federal Share.--The Federal share of assistance 
under this section shall be not less than--
          [(1) 75 percent of the net eligible cost of repair, 
        restoration, reconstruction, or replacement carried out 
        under this section;
          [(2) 100 percent of associated expenses described in 
        subsections (f)(1) and (f)(2); and
          [(3) 75 percent of associated expenses described in 
        subsections (f)(3), (f)(4), and (f)(5).
  [(c) Large In Lieu Contributions.--
          [(1) For public facilities.--In any case where a 
        State or local government determines that the public 
        welfare would not be best served by repairing, 
        restoring, reconstructing, or replacing any public 
        facility owned or controlled by such State or local 
        government, it may elect to receive, in lieu of a 
        contribution under subsection (a)(1), a contribution of 
        not to exceed 90 percent of the Federal share of the 
        Federal estimate of the cost of repairing, restoring, 
        reconstructing, or replacing such facility and of 
        associated expenses. Funds contributed under this 
        subsection may be used to repair, restore, or expand 
        other selected public facilities, to construct new 
        facilities, or to fund hazard mitigation measures which 
        the State or local government determines to be 
        necessary to meet a need for governmental services and 
        functions in the area affected by the major disaster.
          [(2) For private nonprofit facilities.--In any case 
        where a person who owns or operates a private nonprofit 
        facility determines that the public welfare would not 
        be best served by repairing, restoring, reconstructing, 
        or replacing such facility, such person may elect to 
        receive, in lieu of a contribution under subsection 
        (a)(2), a contribution of not to exceed 90 percent of 
        the Federal share of the Federal estimate of the cost 
        of repairing, restoring, reconstructing, or replacing 
        such facility and of associated expenses. Funds 
        contributed under this subsection may be used to 
        repair, restore, or expand other selected private 
        nonprofit facilities owned or operated by such person, 
        to construct new private nonprofit facilities to be 
        owned or operated by such person, or to fund hazard 
        mitigation measures which such person determines to be 
        necessary to meet a need for its services and functions 
        in the area affected by the major disaster.
          [(3) Restriction on use for state or local 
        contribution.--Funds provided under this subsection 
        shall not be used for any State or local government 
        cost-sharing contribution required under this Act.]
  (a) Contributions.--
          (1) In general.--The President may make 
        contributions--
                  (A) to a State or local government for the 
                repair, restoration, reconstruction, or 
                replacement of a public facility which is 
                damaged or destroyed by a major disaster and 
                for associated expenses incurred by such 
                government; and
                  (B) subject to paragraph (2), to a person who 
                owns or operates a private nonprofit facility 
                damaged or destroyed by a major disaster for 
                the repair, restoration, reconstruction, or 
                replacement of such facility and for associated 
                expenses incurred by such person.
          (2) Conditions for assistance to private nonprofit 
        facilities.--
                  (A) In general.--The President may make 
                contributions to a private nonprofit facility 
                under paragraph (1)(B) only if--
                          (i) the facility provides critical 
                        services (as defined by the President) 
                        in the event of a major disaster; or
                          (ii)(I) the owner or operator of the 
                        facility has applied for a disaster 
                        loan under section 7(b) of the Small 
                        Business Act (15 U.S.C. 636(b)); and
                          (II) has been determined to be 
                        ineligible for such a loan; or
                          (III) has obtained such a loan in the 
                        maximum amount for which the Small 
                        Business Administration determines the 
                        facility is eligible.
                  (B) Critical services defined.--In this 
                paragraph, the term ``critical services'' 
                includes, but is not limited to, power, water, 
                sewer, wastewater treatment, communications, 
                and emergency medical care.
  (b) Minimum Federal Share.--The Federal share of assistance 
under this section shall be not less than 75 percent of the 
eligible cost of repair, restoration, reconstruction, or 
replacement carried out under this section.
  (c) Large In-Lieu Contributions.--
          (1) For public facilities.--
                  (A) In general.--In any case in which a State 
                or local government determines that the public 
                welfare would not be best served by repairing, 
                restoring, reconstructing, or replacing any 
                public facility owned or controlled by such 
                State or local government, the State or local 
                government may elect to receive, in lieu of a 
                contribution under subsection (a)(1)(A), a 
                contribution of 75 percent of the Federal share 
                of the Federal estimate of the cost of 
                repairing, restoring, reconstructing, or 
                replacing such facility and of management 
                expenses.
                  (B) Use of funds.--Funds contributed to a 
                State or local government under this paragraph 
                may be used to repair, restore, or expand other 
                selected public facilities, to construct new 
                facilities, or to fund hazard mitigation 
                measures which the State or local government 
                determines to be necessary to meet a need for 
                governmental services and functions in the area 
                affected by the major disaster.
          (2) For private nonprofit facilities.--
                  (A) In general.--In any case where a person 
                who owns or operates a private nonprofit 
                facility determines that the public welfare 
                would not be best served by repairing, 
                restoring, reconstructing, or replacing such 
                facility, such person may elect to receive, in 
                lieu of a contribution under subsection 
                (a)(1)(B), a contribution of 75 percent of the 
                Federal share of the Federal estimate of the 
                cost of repairing, restoring, reconstructing, 
                or replacing such facility and of management 
                expenses.
                  (B) Use of funds.--Funds contributed to a 
                person under this paragraph may be used to 
                repair, restore, or expand other selected 
                private nonprofit facilities owned or operated 
                by the person, to construct new private 
                nonprofit facilities to be owned or operated by 
                the person, or to fund hazard mitigation 
                measures that the person determines to be 
                necessary to meet a need for its services and 
                functions in the area affected by the major 
                disaster.
          (3) Modification of federal share.--The President 
        shall modify the Federal share of the cost estimate 
        provided in paragraphs (1) and (2) if the President 
        determines an alternative cost share will likely reduce 
        the total amount of Federal assistance provided under 
        this section. The Federal cost share for purposes of 
        paragraphs (1) and (2) shall not exceed 90 percent and 
        shall not be less than 50 percent.

           *       *       *       *       *       *       *

  [(e) Net Eligible Cost.--
          [(1) General rule.--For purposes of this section, the 
        cost of repairing, restoring, reconstructing, or 
        replacing a public facility or private nonprofit 
        facility on the basis of the design of such facility as 
        it existed immediately prior to the major disaster and 
        in conformity with current applicable codes, 
        specifications, and standards (including floodplain 
        management and hazard mitigation criteria required by 
        the President or by the Coastal Barrier Resources Act 
        (16 U.S.C. 3501 et seq.)) shall, at a minimum, be 
        treated as the net eligible cost of such repair, 
        restoration, reconstruction, or replacement.
          [(2) Special rule.--In any case in which the facility 
        being repaired, restored, reconstructed, or replaced 
        under this section was under construction on the date 
        of the major disaster, the cost of repairing, 
        restoring, reconstructing, or replacing such facility 
        shall include, for purposes of this section, only those 
        costs which, under the contract for such construction, 
        are the owner's responsibility and not the contractor's 
        responsibility.
  [(f) Associated Expenses.--For purposes of this section, 
associated expenses include the following:
          [(1) Necessary costs.--Necessary costs of requesting, 
        obtaining, and administering Federal assistance based 
        on a percentage of assistance provided as follows:
                  [(A) For an applicant whose net eligible 
                costs equal less than $100,000, 3 percent of 
                such net eligible costs.
                  [(B) For an applicant whose net eligible 
                costs equal $100,000 or more but less than 
                $1,000,000, $3,000 plus 2 percent of such net 
                eligible costs in excess of $100,000.
                  [(C) For an applicant whose net eligible 
                costs equal $1,000,000 or more but less than 
                $5,000,000, $21,000 plus 1 percent of such net 
                eligible costs in excess of $1,000,000.
                  [(D) For an applicant whose net eligible 
                costs equal $5,000,000 or more, $61,000 plus 
                \1/2\ percent of such net eligible costs in 
                excess of $5,000,000.
          [(2) Extraordinary costs.--Extraordinary costs 
        incurred by a State for preparation of damage survey 
        reports, final inspection reports, project 
        applications, final audits, and related field 
        inspections by State employees, including overtime pay 
        and per diem and travel expenses of such employees, but 
        not including pay for regular time of such employees, 
        based on the total amount of assistance provided under 
        sections 403, 404, 406, 407, 502, and 503 in such State 
        in connection with the major disaster as follows:
                  [(A) If such total amount is less than 
                $100,000, 3 percent of such total amount.
                  [(B) If such total amount is $100,000 or more 
                but less than $1,000,000, $3,000 plus 2 percent 
                of such total amount in excess of $100,000.
                  [(C) If such total amount is $1,000,000 or 
                more but less than $5,000,000, $21,000 plus 1 
                percent of such total amount in excess of 
                $1,000,000.
                  [(D) If such total amount is $5,000,000 or 
                more, $61,000 plus \1/2\ percent of such total 
                amount in excess of $5,000,000.
          [(3) Costs of national guard.--The costs of 
        mobilizing and employing the National Guard for 
        performance of eligible work.
          [(4) Costs of prison labor.--The costs of using 
        prison labor to perform eligible work, including wages 
        actually paid, transportation to a worksite, and 
        extraordinary costs of guards, food, and lodging.
          [(5) Other labor costs.--Base and overtime wages for 
        an applicant's employees and extra hires performing 
        eligible work plus fringe benefits on such wages to the 
        extent that such benefits were being paid before the 
        disaster.]
  (e) Eligible Cost.--
          (1) In general.--For the purposes of this section, 
        the estimate of the cost of repairing, restoring, 
        reconstructing, or replacing a public facility or 
        private nonprofit facility on the basis of the design 
        of such facility as it existed immediately before the 
        major disaster and in conformity with current 
        applicable codes, specifications, and standards 
        (including floodplain management and hazard mitigation 
        criteria required by the President or by the Coastal 
        Barrier Resources Act (16 U.S.C. 3501 et seq.)) shall 
        be treated as the eligible cost of such repair, 
        restoration, reconstruction, or replacement. Subject to 
        paragraph (2), the President shall use the cost 
        estimation procedures developed under paragraph (3) to 
        make the estimate under this paragraph.
          (2) Modification of eligible cost.--In the event the 
        actual cost of repairing, restoring, reconstructing, or 
        replacing a facility under this section is more than 
        120 percent or less than 80 percent of the cost 
        estimated under paragraph (1), the President may 
        determine that the eligible cost be the actual cost of 
        such repair, restoration, reconstruction, or 
        replacement. The government or person receiving 
        assistance under this section shall reimburse the 
        President for the portion of such assistance that 
        exceeds the eligible cost of such repair, restoration, 
        reconstruction, or replacement.
          (3) Use of surplus funds.--In the event the actual 
        cost of repairing, restoring, reconstructing, or 
        replacing a facility under this section is less than 
        100 percent but not less than 80 percent of the cost 
        estimated under paragraph (1), the government or person 
        receiving assistance under this section shall use any 
        surplus funds to perform activities that are cost-
        effective and reduce the risk of future damage, 
        hardship, or suffering from a major disaster.
          (4) Expert panel.--Not later than 18 months after the 
        date of enactment of the Disaster Mitigation and Cost 
        Reduction Act of 1999, the President, acting through 
        the Director of the Federal Emergency Management 
        Agency, shall establish an expert panel, including 
        representatives from the construction industry, to 
        develop procedures for estimating the cost of 
        repairing, restoring, reconstructing, or replacing a 
        facility consistent with industry practices.
          (5) Special rule.--In any case in which the facility 
        being repaired, restored, reconstructed, or replaced 
        under this section was under construction on the date 
        of the major disaster, the cost of repairing, 
        restoring, reconstructing, or replacing such facility 
        shall include, for purposes of this section, only those 
        costs which, under the contract for such construction, 
        are the owner's responsibility and not the contractor's 
        responsibility.
          (6) Other eligible costs.--For purposes of this 
        section, other eligible costs include the following:
                  (A) Costs of national guard.--The cost of 
                mobilizing and employing the National Guard for 
                performance of eligible work.
                  (B) Costs of prison labor.--The costs of 
                using prison labor to perform eligible work, 
                including wages actually paid, transportation 
                to a worksite, and extraordinary costs of 
                guards, food, and lodging.
                  (C) Other labor costs.--Base and overtime 
                wages for an applicant's employees and extra 
                hires performing eligible work plus fringe 
                benefits on such wages to the extent that such 
                benefits were being paid before the disaster.

           *       *       *       *       *       *       *


[SEC. 408. TEMPORARY HOUSING ASSISTANCE.

  [(a) Provision of Temporary Housing.--
          [(1) In general.--The President may--
                  [(A) provide, by purchase or lease, temporary 
                housing (including unoccupied habitable 
                dwellings), suitable rental housing, mobile 
                homes, or other readily fabricated dwellings to 
                persons who, as a result of a major disaster, 
                require temporary housing; and
                  [(B) reimburse State and local governments in 
                accordance with paragraph (4) for the cost of 
                sites provided under paragraph (2).
          [(2) Mobile home site.--
                  [(A) In general.--Any mobile home or other 
                readily fabricated dwelling provided under this 
                section shall whenever possible be located on a 
                site which--
                          [(i) is provided by the State or 
                        local government; and
                          [(ii) has utilities provided by the 
                        State or local government, by the owner 
                        of the site, or by the occupant who was 
                        displaced by the major disaster.
                  [(B) Other sites.--Mobile homes and other 
                readily fabricated dwellings may be located on 
                sites provided by the President if the 
                President determines that such siteswould be 
more economical or accessible than sites described in subparagraph (A).
          [(3) Period.--Federal financial and operational 
        assistance under this section shall continue for not 
        longer than 18 months after the date of the major 
        disaster declaration by the President, unless the 
        President determines that due to extraordinary 
        circumstances it would be in the public interest to 
        extend such 18-month period.
          [(4) Federal share.--The Federal share of assistance 
        under this section shall be 100 percent; except that 
        the Federal share of assistance under this section for 
        construction and site development costs (including 
        installation of utilities) at a mobile home group site 
        shall be 75 percent of the eligible cost of such 
        assistance. The State or local government receiving 
        assistance under this section shall pay any cost which 
        is not paid for from the Federal share.
  [(b) Temporary Mortgage and Rental Payments.--The President 
is authorized to provide assistance on a temporary basis in the 
form of mortgage or rental payments to or on behalf of 
individuals and families who, as a result of financial hardship 
caused by a major disaster, have received written notice of 
dispossession or eviction from a residence by reason of a 
foreclosure of any mortgage or lien, cancellation of any 
contract of sale, or termination of any lease, entered into 
prior to such disaster. Such assistance shall be provided for 
the duration of the period of financial hardship but not to 
exceed 18 months.
  [(c) In Lieu Expenditures.--In lieu of providing other types 
of temporary housing after a major disaster, the President is 
authorized to make expenditures for the purpose of repairing or 
restoring to a habitable condition owner-occupied private 
residential structures made uninhabitable by a major disaster 
which are capable of being restored quickly to a habitable 
condition.
  [(d) Transfer of Temporary Housing.--
          [(1) Direct sale to occupants.--Notwithstanding any 
        other provision of law, any temporary housing acquired 
        by purchase may be sold directly to individuals and 
        families who are occupants of temporary housing at 
        prices that are fair and equitable, as determined by 
        the President.
          [(2) Transfers to states, local governments, and 
        voluntary organizations.--The President may sell or 
        otherwise make available temporary housing units 
        directly to States, other governmental entities, and 
        voluntary organizations. The President shall impose as 
        a condition of transfer under this paragraph a covenant 
        to comply with the provisions of section 308 requiring 
        nondiscrimination in occupancy of such temporary 
        housing units. Such disposition shall be limited to 
        units purchased under the provisions of subsection (a) 
        and to the purposes of providing temporary housing for 
        disaster victims in major disasters or emergencies.
  [(e) Notification.--
          [(1) In general.--Each person who applies for 
        assistance under this section shall be notified 
        regarding the type and amount of any assistance for 
        which such person qualifies. Whenever practicable, such 
        notice shall be provided within 7 days after the date 
        of submission of such application.
          [(2) Information.--Notification under this subsection 
        shall provide information regarding--
                  [(A) all forms of such assistance available;
                  [(B) any specific criteria which must be met 
                to qualify for each type of assistance that is 
                available;
                  [(C) any limitations which apply to each type 
                of assistance; and
                  [(D) the address and telephone number of 
                offices responsible for responding to--
                          [(i) appeals of determinations of 
                        eligibility for assistance; and
                          [(ii) requests for changes in the 
                        type or amount of assistance provided.
  [(f) Location.--In providing assistance under this section, 
consideration shall be given to the location of and travel time 
to--
          [(1) the applicant's home and place of business;
          [(2) schools which the applicant or members of the 
        applicant's family who reside with the applicant 
        attend; and
          [(3) crops or livestock which the applicant tends in 
        the course of any involvement in farming which provides 
        25 percent or more of the applicant's annual income.]

SEC. 408. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

  (a) General Authority.--Subject to the requirements of this 
section, the President, in consultation with the Governor of 
the affected State, may provide financial assistance, and, if 
necessary, direct services, to disaster victims who as a direct 
result of a major disaster have necessary expenses and serious 
needs where such victims are unable to meet such expenses or 
needs through other means.
  (b) Housing Assistance.--
          (1) Eligibility.--The President may provide financial 
        or other assistance under this section to individuals 
        and families to respond to the disaster-related housing 
        needs of those who are displaced from their predisaster 
        primary residences or whose predisaster primary 
        residences are rendered uninhabitable as a result of 
        damage caused by a major disaster.
          (2) Determination of appropriate types of 
        assistance.--The President shall determine appropriate 
        types of housing assistance to be provided to disaster 
        victims under this section based upon considerations of 
        cost effectiveness, convenience to disaster victims, 
        and such other factors as the President may consider 
        appropriate. One or more types of housing assistance 
        may be made available, based on the suitability and 
        availability of the types of assistance, to meet the 
        needs of disaster victims in the particular disaster 
        situation.
  (c) Types of Housing Assistance.--
          (1) Temporary housing.--
                  (A) Financial assistance.--
                          (i) In general.--The President may 
                        provide financial assistance under this 
                        section to individuals or households to 
                        rent alternate housing accommodations, 
                        existing rental units, manufactured 
                        housing, recreational vehicles, or 
                        other readily fabricated dwellings.
                          (ii) Amount.--The amount of 
                        assistance under clause (i) shall be 
                        based on the fair market rent for the 
                        accommodation being furnished plus the 
                        cost of any transportation, utility 
                        hookups, or unit installation not being 
                        directly provided by the President.
                  (B) Direct assistance.--
                          (i) In general.--The President may 
                        also directly provide under this 
                        section housing units, acquired by 
                        purchase or lease, to individuals or 
                        households who, because of a lack of 
                        available housing resources, would be 
                        unable to make use of the assistance 
                        provided under subparagraph (A).
                          (ii) Period of assistance.--The 
                        President may not provide direct 
                        assistance under clause (i) with 
                        respect to a major disaster after the 
                        expiration of the 18-month period 
                        beginning on the date of the 
                        declaration of the major disaster by 
                        the President, except that the 
                        President may extend such period if the 
                        President determines that due to 
                        extraordinary circumstances an 
                        extension would be in the public 
                        interest.
                          (iii) Collection of rental charges.--
                        After the expiration of the 18-month 
                        period referred to in clause (ii), the 
                        President may charge fair market rent 
                        for the accommodation being provided.
          (2) Repairs.--The President may provide financial 
        assistance for the repair of owner-occupied private 
        residences, utilities, and residential infrastructure 
        (such as private access routes) damaged by a major 
        disaster to a habitable or functioning condition. A 
        recipient of assistance provided under this paragraph 
        need not show that the assistance can be met through 
        other means, except insurance proceeds, if the 
        assistance is used for emergency repairs to make a 
        private residence habitable and does not exceed $5,000 
        (based on fiscal year 1998 constant dollars).
          (3) Replacement.--The President may provide financial 
        assistance for the replacement of owner-occupied 
        private residences damaged by a major disaster. 
        Assistance provided under this paragraph shall not 
        exceed $10,000 (based on fiscal year 1998 constant 
        dollars). The President may not waive any provision of 
        Federal law requiring the purchase of flood insurance 
        as a condition for the receipt of Federal disaster 
        assistance with respect to assistance provided under 
        this paragraph.
          (4) Permanent housing construction.--The President 
        may provide financial assistance or direct assistance 
        under this section to individuals or households to 
        construct permanent housing in insular areas outside 
        the continental United States and other remote 
        locations in cases in which--
                  (A) no alternative housing resources are 
                available; and
                  (B) the types of temporary housing assistance 
                described in paragraph (1) are unavailable, 
                infeasible, or not cost effective.
  (d) Terms and Conditions Relating to Housing Assistance.--
          (1) Sites.--Any readily fabricated dwelling provided 
        under this section shall, whenever possible, be located 
        on a site complete with utilities, and shall be 
        provided by the State or local government, by the owner 
        of the site, or by the occupant who was displaced by 
        the major disaster. Readily fabricated dwellings may be 
        located on sites provided by the President if the 
        President determines that such sites would be more 
        economical or accessible.
          (2) Disposal of units.--
                  (A) Sale to occupants.--
                          (i) In general.--Notwithstanding any 
                        other provision of law, a temporary 
                        housing unit purchased under this 
                        section by the President for the 
                        purposes of housing disaster victims 
                        may be sold directly to the individual 
                        or household who is occupying the unit 
                        if the individual or household needs 
                        permanent housing.
                          (ii) Sales price.--Sales of temporary 
                        housing units under clause (i) shall be 
                        accomplished at prices that are fair 
                        and equitable.
                          (iii) Deposit of proceeds.--
                        Notwithstanding any other provision of 
                        law, the proceeds of a sale under 
                        clause (i) shall be deposited into the 
                        appropriate Disaster Relief Fund 
                        account.
                          (iv) Use of gsa services.--The 
                        President may use the services of the 
                        General Services Administration to 
                        accomplish a sale under clause (i).
                  (B) Other methods of disposal.--
                          (i) Sale.--If not disposed of under 
                        subparagraph (A), a temporary housing 
                        unit purchased by the President for the 
                        purposes of housing disaster victims 
                        may be resold.
                          (ii) Disposal to governments and 
                        voluntary organizations.--A temporary 
                        housing unit described in clause (i) 
                        may also be sold, transferred, donated, 
                        or otherwise made available directly to 
                        a State or other governmental entity or 
                        to a voluntary organization for the 
                        sole purpose of providing temporary 
                        housing to disaster victims in major 
                        disasters and emergencies if, as a 
                        condition of such sale, transfer, or 
                        donation, the State, other governmental 
                        agency, or voluntary organization 
                        agrees to comply with the 
                        nondiscrimination provisions of section 
                        308 and to obtain and maintain hazard 
                        and flood insurance on the housing 
                        unit.
  (e) Financial Assistance To Address Other Needs.--
          (1) Medical, dental, and funeral expenses.--The 
        President, in consultation with the Governor of the 
        affected State, may provide financial assistance under 
        this section to an individual or household adversely 
        affected by a major disaster to meet disaster-related 
        medical, dental, and funeral expenses.
          (2) Personal property, transportation, and other 
        expenses.--The President, in consultation with the 
        Governor of the affected State, may provide financial 
        assistance under this section to an individual or 
        household described in paragraph (1) to address 
        personal property, transportation, and other necessary 
        expenses or serious needs resulting from the major 
        disaster.
  (f) State Role.--The President shall provide for the 
substantial and ongoing involvement of the affected State in 
administering the assistance under this section.
  (g) Maximum Amount of Assistance.--No individual or household 
shall receive financial assistance greater than $25,000 under 
this section with respect to a single major disaster. Such 
limit shall be adjusted annually to reflect changes in the 
Consumer Price Index for all Urban Consumers published by the 
Department of Labor.
  (h) Issuance of Regulations.--The President shall issue rules 
and regulations to carry out the program, including criteria, 
standards, and procedures for determining eligibility for 
assistance.

           *       *       *       *       *       *       *


[SEC. 411. INDIVIDUAL AND FAMILY GRANT PROGRAMS.

  [(a) In General.--The President is authorized to make a grant 
to a State for the purpose of making grants to individuals or 
families adversely affected by a major disaster for meeting 
disaster-related necessary expenses or serious needs of such 
individuals or families in those cases where such individuals 
or families are unable to meet such expenses or needs through 
assistance under other provisions of this Act or through other 
means.
  [(b) Cost Sharing.--
          [(1) Federal share.--The Federal share of a grant to 
        an individual or a family under this section shall be 
        equal to 75 percent of the actual cost incurred.
          [(2) State contribution.--The Federal share of a 
        grant under this section shall be paid only on 
        condition that the remaining 25 percent of the cost is 
        paid to an individual or family from funds made 
        available by a State.
  [(c) Regulations.--The President shall promulgate regulations 
to carry out this section and such regulations shall include 
national criteria, standards, and procedures for the 
determination of eligibility for grants and the administration 
of grants under this section.
  [(d) Administrative Expenses.--A State may expend not to 
exceed 5 percent of any grant made by the President to it under 
subsection (a) for expenses of administering grants to 
individuals and families under this section.
  [(e) Administration Through Governor.--The Governor of a 
State shall administer the grant program authorized by this 
section in the State.
  [(f) Limit on Grants to Individual.--No individual or family 
shall receive grants under this section aggregating more than 
$10,000 with respect to any single major disaster. Such $10,000 
limit shall annually be adjusted to reflect changes in the 
Consumer Price Index for All Urban Consumers published by the 
Department of Labor.]

           *       *       *       *       *       *       *


                       [community disaster loans

  [Sec. 417. (a) The President is authorized to make loans to 
any local government which may suffer a substantial loss of tax 
and other revenues as a result of a major disaster, and has 
demonstrated a need for financial assistance in order to 
perform its governmental functions. The amount of any such loan 
shall be based on need, and shall not exceed 25 per centum of 
the annual operating budget of that local government for the 
fiscal year in which the major disaster occurs. Repayment of 
all or any part of such loan to the extent that revenues of the 
local government during the three full fiscal year period 
following the major disaster are insufficient to meet the 
operating budget of the local government, including additional 
disaster-related expenses of a municipal operation character 
shall be cancelled.
  [(b) Any loans made under this section shall not reduce or 
otherwise affect any grants or other assistance under this 
Act.]

           *       *       *       *       *       *       *


                        fire suppression grants

  Sec. 420. The President is authorized to provide assistance, 
including grants, equipment, supplies, and personnel, to any 
State and local government for the suppression of any fire on 
publicly or privately owned forest or grassland which threatens 
such destruction as would constitute a major disaster.

           *       *       *       *       *       *       *


[SEC. 422. SIMPLIFIED PROCEDURE.

  [If the Federal estimate of the cost of--
          [(1) repairing, restoring, reconstructing, or 
        replacing under section 406 any damaged or destroyed 
        public facility or private nonprofit facility,
          [(2) emergency assistance under section 403 or 502, 
        or
          [(3) debris removed under section 407,
is less than $35,000, the President (on application of the 
State or local government or the owner or operator of the 
private nonprofit facility) may make the contribution to such 
State or local government or owner or operator under section 
403, 406, 407, or 502, as the case may be, on the basis of such 
Federal estimate. Such $35,000 amount shall be adjusted 
annually to reflect changes in the Consumer Price Index for All 
Urban Consumers published by the Department of Labor.]

           *       *       *       *       *       *       *


TITLE V--EMERGENCY ASSISTANCE PROGRAMS

           *       *       *       *       *       *       *


SEC. 502. FEDERAL EMERGENCY ASSISTANCE.

  (a) * * *

           *       *       *       *       *       *       *

          (6) provide [temporary housing] assistance in 
        accordance with section 408; and

           *       *       *       *       *       *       *


                            ADDITIONAL VIEWS

    Currently, the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act provides to owners and operators of 
private nonprofit facilities damaged or destroyed by a major 
disaster grant assistance for the repair, restoration, 
reconstruction, or replacement of the facility, and for the 
associated expenses incurred by that person. The bill as 
ordered reported would require certain of these owners and 
operators to first apply for Small Business Administration 
(SBA) loans before being eligible for grants. While I 
understand the cost-saving motivation behind this proposal, I 
am concerned that the selective application of this new burden 
could cause certain of these owners and operators of essential 
facilities to be unable to rebuild following a major disaster. 
The resulting loss to the community may be totally unwarranted 
when compared to the minimal savings to the federal disaster 
program.
    By law, to be eligible for this federal assistance, a 
private nonprofit facility must provide essential services of a 
governmental nature to the general public. The very reason that 
these owners and operators of these private nonprofit 
facilities are eligible for assistance is that thye have 
stepped into the shoes of the government to provide a service 
which is deemed essential to the community. Many of us on the 
former Public Works and Transportation Committee, working 
closely with the Reagan Administration, determined that these 
private noprofit owners and operators were deserving of federal 
disaster assistance precisely because of what they do, not 
because of who or what they are.
    The bill as introduced would have required all owners and 
operators of private nonprofit facilities to apply to the Small 
Business Administration for a loan prior to being eligible for 
grant assistance. However, the Committee has approved an 
amendment which will create a two-tiered system where some 
essential services of a governmental nature are now considered 
``critical'' and, as grant eligible more worthy of rebuilding 
assistance than others. The owners and operators of facilities 
that provide ``critical'' services will be eligible for 
immediate grant assistance, but owners and operators of non-
critical services will still have to exhaust their remedies 
with SBA.
    I supported the amendment because it relieved some 
nonprofits of an undesirable burden. But, I believe there 
remains a question of whether we should go further and relieve 
all nonprofits of this burden. I would like to see this issue 
considered further before we go to conference with the other 
body.
    While I believe that it is important for facilities such as 
power, water, wastewater, and the like to be restored to 
operation as soon as possible, I am not sure why these are 
grant eligible essential services, and others, such as those 
supporting custodial care for the aged or disabled, homeless 
shelters, senior citizen and community centers, rehabilitation 
facilities, shelter-workshops, museums, or libraries may not 
be.
    The owners and operators in the ``second tier'' may also be 
the least able to shoulder the financial burden of additional 
debt, even at the favorable terms offered by SBA. In reviewing 
the types of activities that the bill identifies as eligible 
for grants, these are the types of activities which usually 
generate revenue--power, water, sewer and medical care. In 
reviewing the types of services that will have to apply for 
loans, these services generally do not generate significant 
revneue. Unfortunately, the result may be that these services 
are not replaced.
    The government provides many services to many people--and 
not all of them are supported by everyone. In certain 
instances, essential services of a governmental nature are 
provided by private nonprofit entities. The value to a 
community from the rebuilding of a senior citizen center should 
not be dependent upon whether or not it is publicly owned. 
Particularly in the devastating times following a major 
disaster, I would hope that we are not about creating a 
hierarchy of haves and have-nots within the community.

                                                 James L. Oberstar.

                                
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