[House Report 115-304]
[From the U.S. Government Publishing Office]


115th Congress  }                                           {  Report
                        HOUSE OF REPRESENTATIVES
 1st Session    }                                           {  115-304

======================================================================

 
                     21ST CENTURY FLOOD REFORM ACT

                                _______
                                

 September 11, 2017.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Hensarling, from the Committee on Financial Services, submitted the 
                               following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                        [To accompany H.R. 2874]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Financial Services, to whom was referred 
the bill (H.R. 2874) to achieve reforms to improve the 
financial stability of the National Flood Insurance Program, to 
enhance the development of more accurate estimates of flood 
risk through new technology and better maps, to increase the 
role of private markets in the management of flood insurance 
risks, and to provide for alternative methods to insure against 
flood peril, and for other purposes, having considered the 
same, report favorably thereon with an amendment and recommend 
that the bill as amended do pass.
    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

  (a) Short Title.--This Act may be cited as the ``21st Century Flood 
Reform Act''.
  (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title and table of contents.

           TITLE I--POLICYHOLDER PROTECTIONS AND INFORMATION

Sec. 101. Annual limitation on premium increases.
Sec. 102. Flood insurance affordability program.
Sec. 103. Disclosure of premium methodology.
Sec. 104. Consideration of coastal and inland locations in premium 
rates.
Sec. 105. Monthly installment payment of premiums.
Sec. 106. Enhanced clear communication of flood risks.
Sec. 107. Availability of flood insurance information upon request.
Sec. 108. Disclosure of flood risk information upon transfer of 
property.
Sec. 109. Voluntary community-based flood insurance pilot program.
Sec. 110. Extension of National Flood Insurance Program.

TITLE II--INCREASING CONSUMER CHOICE THROUGH PRIVATE MARKET DEVELOPMENT

Sec. 201. Elimination of non-compete requirement.
Sec. 202. Public availability of program information.
Sec. 203. Refund of premiums upon cancellation of policy because of 
replacement with private flood insurance.
Sec. 204. Provision of private flood insurance by mutual aid societies.
Sec. 205. GAO study of flood damage savings accounts.
Sec. 206. Demonstration program for flood damage savings accounts.

                      TITLE III--MAPPING FAIRNESS

Sec. 301. Use of other risk assessment tools in determining premium 
rates.
Sec. 302. Appeals regarding existing flood maps.
Sec. 303. Appeals and publication of projected special flood hazard 
areas.
Sec. 304. Communication and outreach regarding map changes.
Sec. 305. Sharing and use of maps and data.

    TITLE IV--PROTECTING CONSUMERS AND INDIVIDUALS THROUGH IMPROVED 
                               MITIGATION

Sec. 401. Provision of Community Rating System premium credits to 
maximum number of communities practicable.

                       TITLE V--PROGRAM INTEGRITY

Sec. 501. Independent actuarial review.
Sec. 502. Adjustments to homeowner flood insurance affordability 
surcharge.
Sec. 503. National Flood Insurance Reserve Fund compliance.
Sec. 504. Designation and treatment of multiple-loss properties.
Sec. 505. Elimination of coverage for properties with excessive 
lifetime claims.
Sec. 506. Addressing tomorrow's high-risk structures today.
Sec. 507. Pay for performance and streamlining costs and reimbursement.
Sec. 508. Enforcement of mandatory purchase requirements.
Sec. 509. Satisfaction of mandatory purchase requirement in States 
allowing all-perils policies.
Sec. 510. Flood insurance purchase requirements.
Sec. 511. Clarifications; deadline for approval of claims.
Sec. 511. GAO study of simplification of National Flood Insurance 
Program.

           TITLE I--POLICYHOLDER PROTECTIONS AND INFORMATION

SEC. 101. ANNUAL LIMITATION ON PREMIUM INCREASES.

  Section 1308(e) of the National Flood Insurance Act of 1968 (42 
U.S.C. 4015(e)) is amended--
          (1) in paragraph (1), by striking ``18 percent'' and 
        inserting ``15 percent''; and
          (2) in paragraph (2), by striking ``5 percent'' and inserting 
        ``8 percent''.

SEC. 102. FLOOD INSURANCE AFFORDABILITY PROGRAM.

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

``SEC. 1326. FLOOD INSURANCE AFFORDABILITY PROGRAM.

  ``(a) Authority.--The Administrator shall carry out a program under 
this section to provide financial assistance, through State programs 
carried out by participating States, for eligible low-income households 
residing in eligible properties to purchase policies for flood 
insurance coverage made available under this title.
  ``(b) Participation.--Participation in the program under this section 
shall be voluntary on the part of a State or consortium of States.
  ``(c) State Administration.--Each participating State shall delegate 
to a State agency or nonprofit organization the responsibilities for 
administrating the State's program under this section.
  ``(d) Eligible Households.--
          ``(1) In general.--During any fiscal year, assistance under 
        the program under this section may be provided only for a 
        household that has an income, as determined for such fiscal 
        year by the participating State in which such household 
        resides, that is less than the income limitation established 
        for such fiscal year for purposes of the State program by the 
        participating State, except that--
                  ``(A) assistance under the program under this section 
                may not be provided for a household having a income 
                that exceeds the greater of--
                          ``(i) the amount equal to 150 percent of the 
                        poverty level for such State; or
                          ``(ii) the amount equal to 60 percent of the 
                        median income of households residing in such 
                        State; and
                  ``(B) a State may not exclude a household from 
                eligibility in a fiscal year solely on the basis of 
                household income if such income is less than 110 
                percent of the poverty level for the State in which 
                such household resides.
          ``(2) State verification of income eligibility.--In verifying 
        income eligibility for purposes of paragraph (1), the 
        participating State may apply procedures and policies 
        consistent with procedures and policies used by the State 
        agency administering programs under part A of title IV of the 
        Social Security Act (42 U.S.C. 601 et seq.), under title XX of 
        the Social Security Act (42 U.S.C. 1397 et seq.), under 
        subtitle B of title VI of the Omnibus Budget Reconciliation Act 
        of 1981 (42 U.S.C. 9901 et seq.; relating to community services 
        block grant program), under any other provision of law that 
        carries out programs which were administered under the Economic 
        Opportunity Act of 1964 (42 U.S.C. 2701 et seq.) before August 
        13, 1981, or under other income assistance or service programs 
        (as determined by the State).
          ``(3) Certification by state of eligibility households.--For 
        each fiscal year, each participating State shall certify to the 
        Administrator compliance of households who are to be provided 
        assistance under the State program during such fiscal year with 
        the income requirements under paragraph (1).
  ``(e) Eligible Properties.--Assistance under the program under this 
section may be provided only for a residential property--
          ``(1) that has 4 or fewer residences;
          ``(2) that is owned and occupied by an eligible household;
          ``(3) for which a base flood elevation is identified on a 
        flood insurance rate map of the Administrator that is in 
        effect;
          ``(4) for which such other information is available as the 
        Administrator considers necessary to determine the flood risk 
        associated with such property; and
          ``(5) that is located in a community that is participating in 
        the national flood insurance program.
  ``(f) Types of Assistance.--Under the program under this section, a 
participating State shall elect to provide financial assistance for 
eligible households in one of the following forms:
          ``(1) Limitation on rate increases.--By establishing a 
        limitation on the rate of increases in the amount of chargeable 
        premiums paid by eligible households for flood insurance 
        coverage made available under this title.
          ``(2) Limitation on rates.--By establishing a limitation on 
        the amount of chargeable premiums paid by eligible households 
        for flood insurance coverage made available under this title.
  ``(g) Notification to FEMA.--Under the program under this section, a 
participating State shall, on a fiscal year basis and at the time and 
in the manner provided by the Administrator--
          ``(1) identify for the Administrator the eligible households 
        residing in the State who are to be provided assistance under 
        the State program during such fiscal year; and
          ``(2) notify the Administrator of the type and levels of 
        assistance elected under subsection (f) to be provided under 
        the State program with respect to such eligible households 
        residing in the State.
  ``(h) Amount of Assistance.--Under the program under this section, in 
each fiscal year the Administrator shall, notwithstanding section 1308, 
make flood insurance coverage available for purchase by households 
identified as eligible households for such fiscal year by a 
participating State pursuant to subsection (e) at chargeable premium 
rates that are discounted by an amount that is based on the type and 
levels of assistance elected pursuant to subsection (f) by the 
participating State for such fiscal year.
  ``(i) Billing Statement.--In the case of an eligible household for 
which assistance under the program under this section is provided with 
respect to a policy for flood insurance coverage, the annual billing 
statement for such policy shall include statements of the following 
amounts:
          ``(1) The estimated risk premium rate for the property under 
        section 1307(a)(1).
          ``(2) If applicable, the estimated risk premium rate for the 
        property under section 1307(a)(2).
          ``(3) The chargeable risk premium rate for the property 
        taking into consideration the discount pursuant to subsection 
        (h).
          ``(4) The amount of the discount pursuant to subsection (h) 
        for the property.
          ``(5) The number and dollar value of claims filed for the 
        property, over the life of the property, under a flood 
        insurance policy made available under the Program and the 
        effect, under this Act, of filing any further claims under a 
        flood insurance policy with respect to that property.
  ``(j) Funding Through State Affordability Surcharges.--
          ``(1) Imposition and collection.--Notwithstanding section 
        1308, for each fiscal year in which flood insurance coverage 
        under this title is made available for properties in a 
        participating State at chargeable premium rates that are 
        discounted pursuant to subsection (f), the Administrator shall 
        impose and collect a State affordability surcharge on each 
        policy for flood insurance coverage for a property located in 
        such participating State that is (A) not a residential property 
        having 4 or fewer residences, or (B) is such a residential 
        property but is owned by a household that is not an eligible 
        household for purposes of such fiscal year.
          ``(2) Amount.--The amount of the State affordability 
        surcharge imposed during a fiscal year on each such policy for 
        a property in a participating State shall be--
                  ``(A) sufficient such that the aggregate amount of 
                all such State affordability surcharges imposed on 
                properties in such participating State during such 
                fiscal year is equal to the aggregate amount by which 
                all policies for flood insurance coverage under this 
                title sold during such fiscal year for properties owned 
                by eligible households in the participating State are 
                discounted pursuant to subsection (f); and
                  ``(B) the same amount for each property in the 
                participating State being charged such a surplus.
  ``(k) Treatment of Other Surcharges.--The provision of assistance 
under the program under this section with respect to any property and 
any limitation on premiums or premium increases pursuant to subsection 
(f) for the property shall not affect the applicability or amount of 
any surcharge under section 1308A for the property, of any increase in 
premiums charged for the property pursuant to section 1310A(c), or of 
any equivalency fee under section 1308B for the property.
  ``(l) Definitions.--For purposes of this section, the following 
definitions shall apply:
          ``(1) Participating state.--The term `participating State' 
        means, with respect to a fiscal year, a State that is 
        participating in the program under this section for such fiscal 
        year.
          ``(2) Eligible household.--The term `eligible household' 
        means, with respect to a fiscal year and a participating State, 
        a household that has an income that is less than the amount of 
        the income limitation for the fiscal year established for 
        purposes of the State program of such participating State 
        pursuant to subsection (g)(1).
          ``(3) Poverty level.--The term `poverty level'' means, with 
        respect to a household in any State, the income poverty line as 
        prescribed and revised at least annually pursuant to section 
        673(2) of the Community Services Block Grant Act (42 U.S.C. 
        9902(2)), as applicable to such State.
          ``(4) State.--The term `State' shall include a consortium of 
        States established for purposes of administrating the program 
        under this section with respect to the member States of the 
        consortium.
          ``(5) State program.--The term `State program' means a 
        program carried out in compliance with this section by a 
        participating State in conjunction with the program under this 
        section of the Administrator.
  ``(m) Regulations.--The Administrator shall issue such regulations as 
may be necessary to carry out the program under this section.''.

SEC. 103. DISCLOSURE OF PREMIUM METHODOLOGY.

  Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015) is amended by adding at the end the following new subsection:
  ``(n) Disclosure of Premium Methodology.--
          ``(1) Disclosure.--Six months prior to the effective date of 
        risk premium rates, the Administrator shall cause to be 
        published in the Federal Register an explanation of the bases 
        for, and methodology used to determine, the chargeable premium 
        rates to be effective for flood insurance coverage under this 
        title.
          ``(2) Alignment with industry practices.--The disclosure 
        required under paragraph (1) shall, to the extent practicable, 
        be aligned with industry patterns and practices and shall 
        include information and data recommended by the State insurance 
        commissioners guidelines on rate filings.
          ``(3) Public meetings.--The Administrator shall, on an annual 
        basis, hold at least one public meeting in each of the 
        geographical regions of the United States, as defined by the 
        Administrator for purposes of the National Flood Insurance 
        Program, for the purpose of explaining the methodology 
        described in paragraph (1) and answering questions and 
        receiving comments regarding such methodology. The 
        Administrator shall provide notice of each such public meeting 
        in advance, in such manner, and in using such means as are 
        reasonably designed to notify interested parties and members of 
        the public of the date and time, location, and purpose of such 
        meeting, and of how to submit questions or comments.''.

SEC. 104. CONSIDERATION OF COASTAL AND INLAND LOCATIONS IN PREMIUM 
                    RATES.

  (a) Estimates of Premium Rates.--Subparagraph (A) of section 
1307(a)(1) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4014(a)(1)(A)) is amended--
          (1) in clause (i), by striking ``and'' at the end; and
          (2) by adding at the end the following new clause:
                          ``(iii) the differences in flood risk for 
                        properties impacted by coastal flood risk and 
                        properties impacted by riverine, or inland 
                        flood risk; and''.
  (b) Establishment of Chargeable Premium Rates.--Paragraph (1) of 
section 1308(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015(b)(1)) is amended by inserting ``due to differences in flood risk 
resulting from coastal flood hazards and riverine, or inland flood 
hazards and'' after ``including differences in risks''.
  (c) Revised Rates.--Not later than the expiration of the two-year 
period beginning on the date of the enactment of this Act, the 
Administrator of the Federal Emergency Management Agency shall revise 
risk premium rates under the National Flood Insurance Program to 
implement the amendments made by this section.

SEC. 105. MONTHLY INSTALLMENT PAYMENT OF PREMIUMS.

  Subsection (g) of section 1308 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4015(g)) is amended--
          (1) by striking the subsection designation and all that 
        follows through ``With respect'' and inserting the following:
  ``(g) Frequency of Premium Collection.--
          ``(1) Options.--With respect''; and
          (2) by adding at the end the following new paragraph:
          ``(2) Monthly installment payment of premiums.--
                  ``(A) Exemption from rulemaking.--Until such time as 
                the Administrator promulgates regulations implementing 
                paragraph (1) of this subsection, the Administrator may 
                adopt policies and procedures, notwithstanding any 
                other provisions of law and in alignment and consistent 
                with existing industry escrow and servicing standards, 
                necessary to implement such paragraph without 
                undergoing notice and comment rulemaking and without 
                conducting regulatory analyses otherwise required by 
                statute, regulation, or Executive order.
                  ``(B) Installment plan fee.--The Administrator may 
                charge policyholders choosing to pay premiums in 
                monthly installments a fee not to exceed $50 annually.
                  ``(C) Pilot program.--The Administrator may initially 
                implement paragraph (1) of this subsection as a pilot 
                program that provides for a gradual phase-in of 
                implementation.''.

SEC. 106. ENHANCED CLEAR COMMUNICATION OF FLOOD RISKS.

  (a) In General.--Subsection (l) of section 1308 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4015(l)) is amended to read as 
follows:
  ``(l) Clear Communications.--
          ``(1) Newly issued and renewed policies.--For all policies 
        for flood insurance coverage under the National Flood Insurance 
        Program that are newly issued or renewed, the Administrator 
        shall clearly communicate to policyholders--
                  ``(A) their full flood risk determinations, 
                regardless of whether their premium rates are full 
                actuarial rates; and
                  ``(B) the number and dollar value of claims filed for 
                the property, over the life of the property, under a 
                flood insurance policy made available under the Program 
                and the effect, under this Act, of filing any further 
                claims under a flood insurance policy with respect to 
                that property.''.
  (b) Effective Date.--Subsection (l) of section 1308 of the National 
Flood Insurance Act of 1968, as added by subsection (a) of this 
section, shall take effect beginning upon the expiration of the 12-
month period that begins on the date of the enactment of this Act. Such 
subsection (l), as in effect immediately before the amendment made by 
paragraph (1), shall apply during such 12-month period.

SEC. 107. AVAILABILITY OF FLOOD INSURANCE INFORMATION UPON REQUEST.

  Section 1313 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4020) is amended--
          (1) by inserting ``(a) Public Information and Data.--'' after 
        ``Sec. 1313.''; and
          (2) by adding at the end the following new subsection:
  ``(b) Availability of Flood Insurance Information Upon Request.--Not 
later than 30 days after a request for such information by the current 
owner of a property, the Administrator shall provide to the owner any 
information, including historical information, available to the 
Administrator on flood insurance program coverage, payment of claims, 
and flood damages for the property at issue, and any information the 
Administrator has on whether the property owner may be required to 
purchase coverage under the National Flood Insurance Program due to 
previous receipt of Federal disaster assistance, including assistance 
provided by the Small Business Administration, the Department of 
Housing and Urban Development, or the Federal Emergency Management 
Agency, or any other type of assistance that subjects the property to 
the mandatory purchase requirement under section 102 of the Flood 
Disaster Protection Act of 1973 (42 U.S.C. 4012a).''.

SEC. 108. DISCLOSURE OF FLOOD RISK INFORMATION UPON TRANSFER OF 
                    PROPERTY.

  (a) In General.--Chapter 1 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4011 et seq.), as amended by the preceding provisions 
of this Act, is further amended by adding at the end the following new 
section:

``SEC. 1327. DISCLOSURE OF FLOOD RISK INFORMATION UPON TRANSFER OF 
                    PROPERTY.

  ``(a) Requirement for Participation in Program.--After September 30, 
2022, no new flood insurance coverage may be provided under this title 
for any real property located in any area (or subdivision thereof) 
unless an appropriate body has imposed, by statute or regulation, a 
duty on any seller or lessor of improved real estate located in such 
area to provide to any purchaser or lessee of such property a property 
flood hazard disclosure which the Administrator has determined meets 
the requirements of subsection (b).
  ``(b) Disclosure Requirements.--A property flood hazard disclosure 
for a property shall meet the requirements of this subsection only if 
the disclosure--
          ``(1) is made in writing;
          ``(2) discloses any actual knowledge of the seller or lessor 
        of--
                  ``(A) prior physical damage caused by flood to any 
                building located on the property;
                  ``(B) prior insurance claims for losses covered under 
                the National Flood Insurance Program or private flood 
                insurance with respect to such property;
                  ``(C) any previous notification regarding the 
                designation of the property as a repetitive loss or 
                severe repetitive loss property; and
                  ``(D) any Federal legal obligation to obtain and 
                maintain flood insurance running with the property, 
                such as any obligation due to a previous form of 
                disaster assistance under the Robert T. Stafford 
                Disaster Relief and Emergency Assistance Act received 
                by any owner of the property; and
          ``(3) is delivered by or on behalf of the seller or lessor to 
        the purchaser or lessee before such purchaser or lessee becomes 
        obligated under any contract for purchase or lease of the 
        property.''.
  (b) Availability of Flood Insurance Coverage.--Subsection (c) of 
section 1305 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4012(c)) is amended--
          (1) in paragraph (1), by striking ``and'' at the end;
          (2) in paragraph (2), by striking the period at the end and 
        inserting ``; and''; and
          (3) by adding at the end the following new paragraph:
          ``(3) given satisfactory assurance that by September 31, 
        2022, property flood hazard disclosure requirements will have 
        been adopted for the area that meet the requirements of section 
        1326.''.

SEC. 109. VOLUNTARY COMMUNITY-BASED FLOOD INSURANCE PILOT PROGRAM.

  (a) Establishment.--The Administrator of the Federal Emergency 
Management Agency (in this section referred to as the 
``Administrator'') may carry out a community-based flood insurance 
pilot program to make available, for purchase by participating 
communities, a single, community-wide flood insurance policy under the 
National Flood Insurance Program that--
          (1) covers all residential and non-residential properties 
        within the community; and
          (2) satisfies, for all such properties within the community, 
        the mandatory purchase requirements under section 102 of the 
        Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a).
  (b) Participation.--Participation by a community in the pilot program 
under this section shall be entirely voluntary on the part of the 
community.
  (c) Requirements for Community-wide Policies.--The Administrator 
shall ensure that a community-wide flood insurance policy made 
available under the pilot program under this section incorporates the 
following requirements:
          (1) A mapping requirement for properties covered by the 
        policy.
          (2) A cap on premiums.
          (3) A deductible.
          (4) Certification or accreditation of mitigation 
        infrastructure when available and appropriate.
          (5) A community audit.
          (6) The Community Rating System under section 1315(b) of the 
        National Flood Insurance Act of 1968 (42 U.S.C. 4022(b)).
          (7) A method of preventing redundant claims payments by the 
        National Flood Insurance Program in the case of a claim by an 
        individual property owner who is covered by a community-wide 
        flood insurance policy and an individual policy obtained 
        through the Program.
          (8) Coverage for damage arising from flooding that complies 
        with the standards under the National Flood Insurance Program 
        appropriate to the nature and type of property covered.
  (d) Timing.--The Administrator may establish the demonstration 
program under this section not later than the expiration of the 180-day 
period beginning on the date of the enactment of this Act and the 
program shall terminate on September 30, 2022.
  (e) Definition of Community.--For purposes of this section, the term 
``community'' means any unit of local government, within the meaning 
given such term under the laws of the applicable State.

SEC. 110. EXTENSION OF NATIONAL FLOOD INSURANCE PROGRAM.

  (a) Financing.--Section 1309(a) of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4016(a)) is amended by striking ``September 30, 
2017'' and inserting ``September 30, 2022''.
  (b) Program Expiration.--Section 1319 of the National Flood Insurance 
Act of 1968 (42 U.S.C. 4026) is amended by striking ``September 30, 
2017'' and inserting ``September 30, 2022''.

TITLE II--INCREASING CONSUMER CHOICE THROUGH PRIVATE MARKET DEVELOPMENT

SEC. 201. ELIMINATION OF NON-COMPETE REQUIREMENT.

  Section 1345 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4081) is amended by adding at the end the following new subsection:
  ``(f) Authority To Provide Other Flood Coverage.--
          ``(1) In general.--The Administrator may not, as a condition 
        of participating in the Write Your Own Program (as such term is 
        defined in section 1370(a)) or in otherwise participating in 
        the utilization by the Administrator of the facilities and 
        services of insurance companies, insurers, insurance agents and 
        brokers, and insurance adjustment organizations pursuant to the 
        authority in this section, nor as a condition of eligibility to 
        engage in any other activities under the National Flood 
        Insurance Program under this title, restrict any such company, 
        insurer, agent, broker, or organization from offering and 
        selling private flood insurance (as such term is defined in 
        section 102(b)(9) of the Flood Disaster Protection Act of 1973 
        (42 U.S.C. 4012a(b)(9))).
          ``(2) Financial assistance/subsidy arrangement.--After the 
        date of the enactment of this subsection--
                  ``(A) the Administrator may not include in any 
                agreement entered into with any insurer for 
                participation in the Write Your Own Program any 
                provision establishing a condition prohibited by 
                paragraph (1), including the provisions of Article XIII 
                of the Federal Emergency Management Agency, Federal 
                Insurance Administration, Financial Assistance/Subsidy 
                Arrangement, as adopted pursuant to section 62.23(a) of 
                title 44 of the Code of Federal Regulations; and
                  ``(B) any such provision in any such agreement 
                entered into before such date of enactment shall not 
                have any force or effect, and the Administrator may not 
                take any action to enforce such provision.''.

SEC. 202. PUBLIC AVAILABILITY OF PROGRAM INFORMATION.

  Part C of chapter II of the National Flood Insurance Act of 1968 (42 
U.S.C. 4081 et seq.) is amended by adding at the end the following new 
section:

``SEC. 1349. PUBLIC AVAILABILITY OF PROGRAM INFORMATION.

  ``(a) Flood Risk Information.--
          ``(1) In general.--Except as provided in paragraph (2), to 
        facilitate the National Flood Insurance Program becoming a 
        source of information and data for research and development of 
        technology that better understands flooding, the risk of 
        flooding, and the predictability of perils of flooding, the 
        Administrator shall make publicly available all data, models, 
        assessments, analytical tools, and other information in the 
        possession of the Administrator relating to the National Flood 
        Insurance Program under this title that is used in assessing 
        flood risk or identifying and establishing flood elevations and 
        premiums, including--
                  ``(A) data relating to risk on individual properties 
                and loss ratio information and other information 
                identifying losses under the program;
                  ``(B) current and historical policy information, 
                limited to the amount and term only, for properties 
                currently covered by flood insurance and for properties 
                that are no longer covered by flood insurance;
                  ``(C) current and historical claims information, 
                limited to the date and amount paid only, for 
                properties currently covered by flood insurance and for 
                properties that are no longer covered by flood 
                insurance;
                  ``(D) identification of whether a property was 
                constructed before or after the effective date of the 
                first flood insurance rate map for a community;
                  ``(E) identification of properties that have been 
                mitigated through elevation, a buyout, or any other 
                mitigation action; and
                  ``(F) identification of unmitigated multiple-loss 
                properties.
          ``(2) Open source data system.--In carrying out paragraph 
        (1), the Administrator shall establish an open source data 
        system by which all information required to be made publicly 
        available by such subsection may be accessed by the public on 
        an immediate basis by electronic means.
  ``(b) Community Information.--Not later than the expiration of the 
12-month period beginning upon the date of the enactment of this 
section, the Administrator shall establish and maintain a publicly 
searchable database that provides information about each community 
participating in the National Flood Insurance Program, which shall 
include the following information:
          ``(1) The status of the community's compliance with the 
        National Flood Insurance Program, including any findings of 
        noncompliance, the status of any enforcement actions initiated 
        by a State or by the Administrator, and the number of days of 
        any such continuing noncompliance.
          ``(2) The number of properties located in the community's 
        special flood hazard areas that were built before the effective 
        date of the first flood insurance rate map for the community.
          ``(3) The number of properties located in the community's 
        special flood hazard areas that were built after the effective 
        date of the first flood insurance rate map for the community.
          ``(4) The total number of current and historical claims 
        located outside the community's special flood hazard areas.
          ``(5) The total number of multiple-loss properties in the 
        community.
          ``(6) The portion of the community, stated as a percentage 
        and in terms of square miles, that is located within special 
        flood hazard areas.
  ``(c) Identification of Properties.--The information provided 
pursuant to subsections (a) and (b) shall be based on data that 
identifies properties at the zip code or census block level, and shall 
include the name of the community and State in which a property is 
located.
  ``(d) Protection of Personally Identifiable Information.--The 
information provided pursuant to subsections (a) and (b) shall be 
disclosed in a format that does not reveal individually identifiable 
information about property owners in accordance with the section 552a 
of title 5, United States Code.
  ``(e) Definition of Loss Ratio.--For purposes of this section, the 
term `loss ratio' means, with respect to the National Flood Insurance 
Program, the ratio of the amount of claims paid under the Program to 
the amount of premiums paid under the Program.''.

SEC. 203. REFUND OF PREMIUMS UPON CANCELLATION OF POLICY BECAUSE OF 
                    REPLACEMENT WITH PRIVATE FLOOD INSURANCE.

  Section 1306 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4013) is amended by adding at the end the following new subsection:
  ``(e) Refund of Unearned Premiums for Policies Canceled Because of 
Replacement With Private Flood Insurance.--
          ``(1) Required refund.--Subject to subsection (c), if at any 
        time an insured under a policy for flood insurance coverage for 
        a property that is made available under this title cancels such 
        policy because other duplicate flood insurance coverage for the 
        same property has been obtained from a source other than the 
        National Flood Insurance Program under this title, the 
        Administrator shall refund to the former insured a portion of 
        the premiums paid for the coverage made available under this 
        title, as determined consistent with industry practice 
        according to the portion of the term of the policy that such 
        coverage was in effect, but only if a copy of declarations page 
        of the new policy obtained from a source other than the program 
        under this title is provided to the Administrator.
          ``(2) Effective date of cancellation.--For purposes of this 
        subsection, a cancellation of a policy for coverage made 
        available under the national flood insurance program under this 
        title, for the reason specified in paragraph (1), shall be 
        effective--
                  ``(A) on the effective date of the new policy 
                obtained from a source other than the program under 
                this title, if the request for such cancellation was 
                received by the Administrator before the expiration of 
                the 6-month period beginning on the effective date of 
                the new policy; or
                  ``(B) on the date of the receipt by the Administrator 
                of the request for cancellation, if the request for 
                such cancellation was received by the Administrator 
                after the expiration of the 6-month period beginning on 
                the effective date of the new policy.
          ``(3) Prohibition of refunds for properties receiving 
        increased cost of compliance claims.--No premium amounts paid 
        for coverage made available under this title may be refunded 
        pursuant to this subsection--
                  ``(A) with respect to coverage for any property for 
                which measures have been implemented using amounts 
                received pursuant to a claim under increased cost of 
                compliance coverage made available pursuant to section 
                1304(b); or
                  ``(B) if a claim has been paid or is pending under 
                the policy term for which the refund is sought.''.

SEC. 204. PROVISION OF PRIVATE FLOOD INSURANCE BY MUTUAL AID SOCIETIES.

  Paragraph (7) of section 102(b) of the Flood Disaster Protection Act 
of 1973 (42 U.S.C. 4012a(c)) is amended to read as follows:
          ``(7) Definitions.--In this section:
                  ``(A) Federal flood insurance.--The term `Federal 
                flood insurance' means an insurance policy made 
                available under the National Flood Insurance Act of 
                1968 (42 U.S.C. 4001 et seq.).
                  ``(B) Flood insurance.--The term `flood insurance' 
                means--
                          ``(i) Federal flood insurance; and
                          ``(ii) private flood insurance.
                  ``(C) Mutual aid society.--The term `mutual aid 
                society' means an organization--
                          ``(i) the members of which--
                                  ``(I) share a common set of ethical 
                                or religious beliefs; and
                                  ``(II) in accordance with the beliefs 
                                described in subclause (I), agree to 
                                cover expenses arising from damage to 
                                property of the members of the 
                                organization, including damage caused 
                                by flooding; and
                          ``(ii) that has a demonstrated history of 
                        fulfilling the terms of agreements to cover 
                        expenses arising from damage to property of the 
                        members of the organization caused by flooding.
                  ``(D) Private flood insurance.--The term `private 
                flood insurance' means--
                          ``(i) an insurance policy that--
                                  ``(I) is issued by an insurance 
                                company that is--
                                          ``(aa) licensed, admitted, or 
                                        otherwise approved to engage in 
                                        the business of insurance in 
                                        the State in which the insured 
                                        building is located, by the 
                                        insurance regulator of that 
                                        State; or
                                          ``(bb) eligible as a 
                                        nonadmitted insurer to provide 
                                        insurance in the home State of 
                                        the insured, in accordance with 
                                        sections 521 through 527 of the 
                                        Nonadmitted and Reinsurance 
                                        Reform Act of 2010 (15 U.S.C. 
                                        8201 through 8206);
                                  ``(II) is issued by an insurance 
                                company that is not otherwise 
                                disapproved as a surplus lines insurer 
                                by the insurance regulator of the State 
                                in which the property to be insured is 
                                located; and
                                  ``(III) provides flood insurance 
                                coverage that complies with the laws 
                                and regulations of that State; or
                          ``(ii) an agreement with a mutual aid society 
                        for such society to cover expenses arising from 
                        damage to property of the members of such 
                        society caused by flooding, unless the State in 
                        which the property to be insured is located 
                        has--
                                  ``(I) determined that the specific 
                                mutual aid society may not provide such 
                                coverage or provide such coverage in 
                                such manner; or
                                  ``(II) specifically provided through 
                                law or regulation that mutual aid 
                                societies may not provide such coverage 
                                or provide such coverage in such 
                                manner.
                  ``(E) State.--The term `State' means any State of the 
                United States, the District of Columbia, the 
                Commonwealth of Puerto Rico, Guam, the Northern Mariana 
                Islands, the Virgin Islands, and American Samoa.''.

SEC. 205. GAO STUDY OF FLOOD DAMAGE SAVINGS ACCOUNTS.

  (a) In General.--The Comptroller General of the United States shall 
conduct a study to analyze the feasibility and effectiveness, and 
problems involved, in reducing flood insurance premiums and eliminating 
the need for purchase of flood insurance coverage by authorizing owners 
of residential properties to establish flood damage savings accounts 
described in subsection (b) in lieu of complying with the mandatory 
requirements under section 102 of the Flood Disaster Protection Act of 
1973 (42 U.S.C. 4012a) to purchase flood insurance for such properties.
  (b) Flood Damage Savings Account.--A flood damage savings account 
described in this subsection is a savings account--
          (1) that would be established by an owner of residential 
        property with respect to such property in accordance with 
        requirements established by the Administrator of the Federal 
        Emergency Management Agency; and
          (2) the proceeds of which would be available for use only to 
        cover losses to such properties resulting from flooding, 
        pursuant to adjustment of a claim for such losses in the same 
        manner and according to the same procedures as apply to claims 
        for losses under flood insurance coverage made available under 
        the National Flood Insurance Act of 1968.
  (c) Issues.--Such study shall include an analysis of, and 
recommendation regarding, each of the following issues:
          (1) Whether authorizing the establishment of such flood 
        damage savings accounts would be effective and efficient in 
        reducing flood insurance premiums, eliminating the need for 
        purchase of flood insurance coverage made available under the 
        National Flood Insurance Program, and reducing risks to the 
        financial safety and soundness of the National Flood Insurance 
        Fund.
          (2) Possible options for structuring such flood damage 
        savings accounts, including--
                  (A) what types of institutions could hold such 
                accounts and the benefits and problems with each such 
                type of institution;
                  (B) considerations affecting the amounts required to 
                be held in such accounts; and
                  (C) options regarding considerations the conditions 
                under which such an account may be terminated.
          (3) The feasibility and effectiveness, and problems involved 
        in, authorizing the Administrator of the Federal Emergency 
        Management Agency to make secondary flood insurance coverage 
        available under the National Flood Insurance Program to cover 
        the portion of flood losses or damages to properties for which 
        such flood damage savings accounts have been established that 
        exceed the amounts held in such accounts.
          (4) The benefits and problems involved in authorizing the 
        establishment of such accounts for non-residential properties.
  (d) Report.--Not later than the expiration of the 12-month period 
beginning on the date of the enactment of this Act, the Comptroller 
General shall submit a report to the Committee on Financial Services of 
the House of Representatives, the Committee on Banking, Housing, and 
Urban Affairs of the Senate, and the Administrator that sets forth the 
analysis, conclusions, and recommendations resulting from the study 
under this section. Such report shall identify elements that should be 
taken into consideration by the Administrator in designing and carrying 
out the demonstration program under section 205.

SEC. 206. DEMONSTRATION PROGRAM FOR FLOOD DAMAGE SAVINGS ACCOUNTS.

  (a) Plan.--If the Comptroller General of the United States concludes 
in the report required under section 205 that a demonstration program 
under this section is feasible and should be considered, then the 
Administrator of the Federal Emergency Management Agency shall, not 
later than the expiration of the 12-month period beginning upon the 
submission of the report under section 205(d), submit to the Committee 
on Financial Services of the House of Representatives and the Committee 
on Banking, Housing, and Urban Affairs of the Senate a plan and 
guidelines for a demonstration program, to be carried out by the 
Administrator, to demonstrate the feasibility and effectiveness of 
authorizing the establishment of flood damage savings accounts, taking 
into consideration the analysis, conclusions, and recommendations 
included in such report.
  (b) Authority.--The Administrator of the Federal Emergency Management 
Agency shall carry out a program to demonstrate the feasibility and 
effectiveness of authorizing the establishment of flood damage savings 
accounts in the manner provided in plan and guidelines for the 
demonstration program submitted pursuant to subsection (a).
  (c) Scope.--The demonstration program under this section shall 
provide for the establishment of flood damage savings accounts with 
respect to not more than 5 percent of the residential properties that 
have 4 or fewer residences and that are covered by flood insurance 
coverage made available under the National Flood Insurance Program.
  (d) Timing.--The Administrator shall commence the demonstration 
program under this section not later than the expiration of the 12-
month period beginning upon the submission of the plan and guidelines 
for the demonstration pursuant to subsection (a).
  (e) Geographical Diversity.--The Administrator shall ensure that 
properties for which flood damage savings accounts are established 
under the demonstration are located in diverse geographical areas 
throughout the United States.
  (f) Report.--Upon the expiration of the 2-year period beginning upon 
the date of the commencement of the demonstration program under this 
section, the Administrator shall submit a report to the Committee on 
Financial Services of the House of Representatives and the Committee on 
Banking, Housing, and Urban Affairs of the Senate describing and 
assessing the demonstration, and setting forth conclusions and 
recommendations regarding continuing and expanding the demonstration.
  (g) Feasibility.--The Administrator shall implement this section only 
after determining that implementation is supported by the Comptroller's 
conclusions and recommendations contained in the report required under 
section 205.

                      TITLE III--MAPPING FAIRNESS

SEC. 301. USE OF OTHER RISK ASSESSMENT TOOLS IN DETERMINING PREMIUM 
                    RATES.

  (a) Estimates of Premium Rates.--Subparagraph (A) of section 
1307(a)(1) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4014(a)(1)(A)) is amended--
          (1) in clause (ii), by striking ``and'' at the end; and
          (2) by adding at the end the following new clause:
                          ``(iv) both the risk identified by the 
                        applicable flood insurance rate maps and by 
                        other risk assessment data and tools, including 
                        risk assessment models and scores from 
                        appropriate sources; and''.
  (b) Establishment of Chargeable Premium Rates.--Paragraph (1) of 
section 1308(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4015(b)(1)) is amended by inserting before the semicolon at the end the 
following: ``, taking into account both the risk identified by the 
applicable flood insurance rate maps and by other risk assessment data 
and tools, including risk assessment models and scores from appropriate 
sources''.
  (c) Effective Date and Regulations.--
          (1) Effective date.--The amendments made by subsections (a) 
        and (b) shall be made, and shall take effect, upon the 
        expiration of the 36-month period beginning on the date of the 
        enactment of this Act.
          (2) Regulations.--The Administrator of the Federal Emergency 
        Management Agency shall issue regulations necessary to 
        implement the amendments made by subsections (a) and (b), which 
        shall identify risk assessment data and tools to be used in 
        identifying flood risk and appropriate sources for risk 
        assessment models and scores to be so used. Such regulations 
        shall be issued not later than the expiration of the 36-month 
        period beginning on the date of the enactment of this Act and 
        shall take effect upon the expiration of such period.

SEC. 302. APPEALS REGARDING EXISTING FLOOD MAPS.

  (a) In General.--Section 1360 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4101) is amended by adding at the end the following new 
subsection:
  ``(k) Appeals of Existing Maps.--
          ``(1) Right to appeal.--Subject to paragraph (6), a State or 
        local government, or the owner or lessee of real property, who 
        has made a formal request to the Administrator to update a 
        flood map that the Administrator has denied may at any time 
        appeal such a denial as provided in this subsection.
          ``(2) Basis for appeal.--The basis for appeal under this 
        subsection shall be the possession of knowledge or information 
        that--
                  ``(A) the base flood elevation level or designation 
                of any aspect of a flood map is scientifically or 
                technically inaccurate; or
                  ``(B) factors exist that mitigate the risk of 
                flooding, including ditches, banks, walls, vegetation, 
                levees, lakes, dams, reservoirs, basin, retention 
                ponds, and other natural or manmade topographical 
                features.
          ``(3) Appeals process.--
                  ``(A) Administrative adjudication.--An appeal under 
                this subsection shall be determined by a final 
                adjudication on the record, and after opportunity for 
                an administrative hearing.
                  ``(B) Rights upon adverse decision.--If an appeal 
                pursuant to subparagraph (A) does not result in a 
                decision in favor of the State, local government, 
                owner, or lessee, such party may appeal the adverse 
                decision to the Scientific Resolution Panel provided 
                for in section 1363A, which shall recommend a non-
                binding decision to the Administrator.
          ``(4) Relief.--
                  ``(A) Wholly successful appeals.--In the case of a 
                successful appeal resulting in a policyholder's 
                property being removed from a special flood hazard 
                area, such policyholder may cancel the policy at any 
                time within the current policy year, and the 
                Administrator shall provide such policyholder a refund 
                in the amount of any premiums paid for such policy 
                year, plus any premiums paid for flood insurance 
                coverage that the policyholder was required to purchase 
                or maintain during the 2-year period preceding such 
                policy year.
                  ``(B) Partially successful appeals.--In the case of 
                any appeal in which mitigating factors were determined 
                to have reduced, but not eliminated, the risk of 
                flooding, the Administrator shall reduce the amount of 
                flood insurance coverage required to be maintained for 
                the property concerned by the ratio of the successful 
                portion of the appeal as compared to the entire appeal. 
                The Administrator shall refund to the policyholder any 
                payments made in excess of the amount necessary for 
                such new coverage amount, effective from the time when 
                the mitigating factor was created or the beginning of 
                the second policy year preceding the determination of 
                the appeal, whichever occurred later.
                  ``(C) Additional relief.--The Administrator may 
                provide additional refunds in excess of the amounts 
                specified in subparagraphs (A) and (B) if the 
                Administrator determines that such additional amounts 
                are warranted.
          ``(5) Recovery of costs.--When, incident to any appeal which 
        is successful in whole or part regarding the designation of the 
        base flood elevation or any aspect of the flood map, including 
        elevation or designation of a special flood hazard area, the 
        community, or the owner or lessee of real property, as the case 
        may be, incurs expense in connection with the appeal, including 
        services provided by surveyors, engineers, and scientific 
        experts, the Administrator shall reimburse such individual or 
        community for reasonable expenses to an extent measured by the 
        ratio of the successful portion of the appeal as compared to 
        the entire appeal, but not including legal services, in the 
        effecting of an appeal based on a scientific or technical error 
        on the part of the Federal Emergency Management Agency. No 
        reimbursement shall be made by the Administrator in respect to 
        any fee or expense payment, the payment of which was agreed to 
        be contingent upon the result of the appeal. The Administrator 
        may use such amounts from the National Flood Insurance Fund 
        established under section 1310 as may be necessary to carry out 
        this paragraph.
          ``(6) Inapplicability to community flood maps.--This 
        subsection shall not apply with respect to any flood map that 
        is in effect pursuant to certification under the standards, 
        guidelines, and procedures established pursuant to section 
        100215(m)(1)(B) of the Biggert-Waters Flood Insurance Reform 
        Act of 2012 (42 U.S.C. 4101a(m)(1)(B)).
          ``(7) Guidance.--The Administrator shall issue guidance to 
        implement this subsection, which shall not be subject to the 
        notice and comment requirements under section 553 of title 5, 
        United States Code.''.
  (b) Deadline.--The Administrator of the Federal Emergency Management 
Agency shall issue the guidance referred to section 1360(k)(7) of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4101(k)(7)), as added 
by the amendment made by subsection (a) of this section, not later than 
the expiration of the 6-month period beginning on the date of the 
enactment of this Act.

SEC. 303. APPEALS AND PUBLICATION OF PROJECTED SPECIAL FLOOD HAZARD 
                    AREAS.

  (a) Appeals.--Section 1363 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4104) is amended--
          (1) in subsection (b), by striking the second sentence and 
        inserting the following: ``Any owner or lessee of real property 
        within the community who believes the owner's or lessee's 
        rights to be adversely affected by the Administrator's proposed 
        determination may appeal such determination to the local 
        government no later than 90 days after the date of the second 
        publication.'';
          (2) in subsection (d), by striking ``subsection (e)'' and 
        inserting ``subsection (f)'';
          (3) by redesignating subsections (e), (f), and (g) as 
        subsections (f), (g), and (h), respectively; and
          (4) by inserting after subsection (d) the following new 
        subsection:
  ``(e) Determination by Administrator in the Absence of Appeals.--If 
the Administrator has not received any appeals, upon expiration of the 
90-day appeal period established under subsection (b) of this section 
the Administrator's proposed determination shall become final. The 
community shall be given a reasonable time after the Administrator's 
final determination in which to adopt local land use and control 
measures consistent with the Administrator's determination.''.
  (b) Publication.--Subsection (a) of section 1363 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4104(a)) is amended by striking 
``in the Federal Register''.
  (c) Inapplicability to Private and Community Flood Maps.--Section 
1363 of the National Flood Insurance Act of 1968 (42 U.S.C. 4104), as 
amended by the preceding provisions of this section, is further amended 
by adding at the end the following new subsection:
  ``(i) Inapplicability to Community Flood Maps.--This section shall 
not apply with respect to any flood map that is in effect pursuant to 
certification under the standards, guidelines, and procedures 
established pursuant to section 100215(m)(1) of the Biggert-Waters 
Flood Insurance Reform Act of 2012 (42 U.S.C. 4101a(m)(1)), which shall 
include procedures for providing notification and appeal rights to 
individuals within the communities of the proposed flood elevation 
determinations.''.

SEC. 304. COMMUNICATION AND OUTREACH REGARDING MAP CHANGES.

  Paragraph (1) of section 100216(d) of the Biggert-Waters Flood 
Insurance Reform Act of 2012 (42 U.S.C. 4101b(d)(1)) is amended--
          (1) in subparagraph (B), by inserting ``maximum'' before 
        ``30-day period''; and
          (2) in subparagraph (C), by inserting ``maximum'' before 
        ``30-day period''.

SEC. 305. SHARING AND USE OF MAPS AND DATA.

  Subsection (b) of section 100216 of the Biggert-Waters Flood 
Insurance Reform Act of 2012 (42 U.S.C. 4101b(b)) is amended--
          (1) in paragraph (1)--
                  (A) in subparagraph (B), by striking ``and'' at the 
                end;
                  (B) in subparagraph (C), by striking the period at 
                the end and inserting ``; and'' ; and
                  (C) by adding at the end the following new 
                subparagraph:
                  ``(D) consult and coordinate with the Department of 
                Defense, the United States Geological Survey, and the 
                National Oceanic and Atmospheric Administration for the 
                purpose of obtaining the most-up-to-date maps and other 
                information of such agencies, including information on 
                topography, water flow, and any other issues, relevant 
                to mapping for flood insurance purposes.''; and
          (2) in paragraph (3)--
                  (A) in subparagraph (D), by striking ``and'' at the 
                end;
                  (B) by redesignating subparagraph (E) as subparagraph 
                (F); and
                  (C) by inserting after subparagraph (D) the following 
                new subparagraph:
                  ``(E) any other information relevant to mapping for 
                flood insurance purposes obtained pursuant to paragraph 
                (1)(D); and''.

    TITLE IV--PROTECTING CONSUMERS AND INDIVIDUALS THROUGH IMPROVED 
                               MITIGATION

SEC. 401. PROVISION OF COMMUNITY RATING SYSTEM PREMIUM CREDITS TO 
                    MAXIMUM NUMBER OF COMMUNITIES PRACTICABLE.

  Subsection (b) of section 1315 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4022(b)) is amended--
          (1) in paragraph (2), by striking ``may'' and inserting 
        ``shall''; and
          (2) in paragraph (3), by inserting ``, and the Administrator 
        shall provide credits to the maximum number of communities 
        practicable'' after ``under this program''.

                       TITLE V--PROGRAM INTEGRITY

SEC. 501. INDEPENDENT ACTUARIAL REVIEW.

  Section 1309 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4016) is amended by adding at the end the following new subsection:
  ``(e) Independent Actuarial Review.--
          ``(1) Fiduciary responsibility.--The Administrator has a 
        responsibility to ensure that the National Flood Insurance 
        Program remains financially sound. Pursuant to this 
        responsibility, the Administrator shall from time to time 
        review and eliminate nonessential costs and positions within 
        the Program, unless otherwise authorized or required by law, as 
        the Administrator determines to be necessary.
          ``(2) Annual independent actuarial study.--The Administrator 
        shall provide for an independent actuarial study of the 
        National Flood Insurance Program to be conducted annually, 
        which shall analyze the financial position of the program based 
        on the long-term estimated losses of the program. The 
        Administrator shall submit a report (together with the 
        independent actuarial study) annually to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        describing the results of such study, including a determination 
        of whether the Program has collected revenue sufficient to 
        cover the administrative expenses of carrying out the flood 
        insurance program, which are reflected in the risk premium 
        rates, cost of capital, all other costs associated with the 
        transfer of risks, and expected claims payments during the 
        reporting period, and an overall assessment of the financial 
        status of the Program.
          ``(3) Determination of actuarial budget deficit.--
                  ``(A) Requirement.--Within the report submitted under 
                paragraph (2), the Administrator shall issue a 
                determination of whether there exists an actuarial 
                budget deficit for the Program for the year covered in 
                the report. The report shall recommend any changes to 
                the Program, if necessary, to ensure that the program 
                remains financially sound.
                  ``(B) Basis of determination.--The determination 
                required by subparagraph (A) shall be based solely upon 
                whether the portion of premiums estimated and collected 
                by the Program during the reporting period is 
                sufficient to cover the administrative expenses of 
                carrying out the flood insurance program, which are 
                reflected in the risk premium rates, cost of capital, 
                all other costs associated with the transfer of risk, 
                and expected claims payments for the reporting period.
          ``(4) Quarterly reports.--During each fiscal year, on a 
        calendar quarterly basis, the Secretary shall cause to be 
        published in the Federal Register or comparable method, with 
        notice to the Committee on Financial Services of the House of 
        Representatives and the Committee on Banking, Housing, and 
        Urban Affairs of the Senate, information which shall specify--
                  ``(A) the cumulative volume of policies that have 
                been underwritten under the National Flood Insurance 
                Program during such fiscal year through the end of the 
                quarter for which the report is submitted;
                  ``(B) the types of policies insured, categorized by 
                risk;
                  ``(C) any significant changes between actual and 
                projected claim activity;
                  ``(D) projected versus actual loss rates;
                  ``(E) the cumulative number of currently insured 
                repetitive-loss properties, severe repetitive-loss 
                properties, and extreme repetitive-loss properties that 
                have been identified during such fiscal year through 
                the end of the quarter for which the report is 
                submitted;
                  ``(F) the cumulative number of properties that have 
                undergone mitigation assistance, through the National 
                Flood Insurance Program, during such fiscal year 
                through the end of the quarter for which the report is 
                submitted; and
                  ``(G) the number and location, by State or territory, 
                of each policyholder that has been identified for such 
                fiscal year as an eligible household for purposes of 
                the flood insurance affordability program under section 
                1326.
        The first quarterly report under this paragraph shall be 
        submitted on the last day of the first quarter of fiscal year 
        2018, or on the last day of the first full calendar quarter 
        following the enactment of the 21st Century Flood Reform Act, 
        whichever occurs later.''.

SEC. 502. ADJUSTMENTS TO HOMEOWNER FLOOD INSURANCE AFFORDABILITY 
                    SURCHARGE.

  (a) In General.--Section 1308A of the National Flood Insurance Act of 
1968 (42 U.S.C. 4015a) is amended--
          (1) in subsection (a), by striking the first sentence and 
        inserting the following: ``The Administrator shall impose and 
        collect a non-refundable annual surcharge, in the amount 
        provided in subsection (b), on all policies for flood insurance 
        coverage under the National Flood Insurance Program that are 
        newly issued or renewed after the date of the enactment of this 
        section.''; and
          (2) by striking subsection (b) and inserting the following 
        new subsection:
  ``(b) Amount.--The amount of the surcharge under subsection (a) shall 
be $40, except as follows:
          ``(1) Non-primary residences eligible for prp.--The amount of 
        the surcharge under subsection (a) shall be $125 in the case of 
        in the case of a policy for any property that is--
                  ``(A) a residential property that is not the primary 
                residence of an individual, and
                  ``(B) eligible for preferred risk rate method 
                premiums.
          ``(2) Non-residential properties and non-primary residences 
        not eligible for prp.--The amount of the surcharge under 
        subsection (a) shall be $275 in case of in the case of a policy 
        for any property that is--
                  ``(A) a non-residential property; or
                  ``(B) a residential property that is--
                          ``(i) not the primary residence of an 
                        individual; and
                          ``(ii) not eligible for preferred risk rate 
                        method premiums.''.
  (b) Applicability.--The amendment made by subsection (a) shall apply 
with respect to policies for flood insurance coverage under the 
National Flood Insurance Act of 1968 that are newly issued or renewed 
after the expiration of the 12-month period beginning on the date of 
the enactment of this Act.

SEC. 503. NATIONAL FLOOD INSURANCE RESERVE FUND COMPLIANCE.

  Section 1310A of the National Flood Insurance Act of 1968 (42 U.S.C. 
4017A) is amended--
          (1) in subsection (c)(2)(D), by inserting before the period 
        at the end the following: ``, including any provisions relating 
        to chargeable premium rates or annual increases of such 
        rates'';
          (2) in subsection (c)(3), by striking subparagraph (A) and 
        inserting the following new subparagraph:
                  ``(A) Parity.--In exercising the authority granted 
                under paragraph (1) to increase premiums, the 
                Administrator shall institute a single annual, uniform 
                rate of assessment for all individual policyholders.''; 
                and
          (3) in subsection (d)--
                  (A) by striking paragraph (1) and inserting the 
                following new paragraph:
          ``(1) In general.--Beginning in fiscal year 2018 and not 
        ending until the fiscal year in which the ratio required under 
        subsection (b) is achieved--
                  ``(A) in each fiscal year the Administrator shall 
                place in the Reserve Fund an amount equal to not less 
                than 7.5 percent of the reserve ratio required under 
                subsection (b); and
                  ``(B) if in any given fiscal year the Administrator 
                fails to comply with subparagraph (A), for the 
                following fiscal year the Administrator shall increase 
                the rate of the annual assessment pursuant to 
                subsection (c)(3)(A) by at least one percentage point 
                over the rate of the annual assessment pursuant to 
                subsection (c)(3)(A) in effect on the first day of such 
                given fiscal year.'';
                  (B) in paragraph (2), by inserting before the period 
                at the end the following: ``nor to increase assessments 
                pursuant to paragraph (1)(B)''; and
                  (C) in paragraph (3), by inserting before the period 
                at the end the following: ``and paragraph (1)(B) shall 
                apply until the fiscal year in which the ratio required 
                under subsection (b) is achieved''.

SEC. 504. DESIGNATION AND TREATMENT OF MULTIPLE-LOSS PROPERTIES.

  (a) Definition.--Section 1370 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4121) is amended--
          (1) in subsection (a)--
                  (A) by striking paragraph (7); and
                  (B) by redesignating paragraphs (8) through (15) as 
                paragraphs (7) through (14), respectively; and
          (2) by adding at the end the following new subsection:
  ``(d) Multiple-Loss Properties.--
          ``(1) Definitions.--As used in this title:
                  ``(A) Multiple-loss property.--The term `multiple-
                loss property' means any property that is a repetitive-
                loss property, a severe repetitive-loss property, or an 
                extreme repetitive-loss property.
                  ``(B) Repetitive-loss property.--The term 
                `repetitive-loss property' means a structure that has 
                incurred flood damage for which two or more separate 
                claims payments of any amount have been made under 
                flood insurance coverage under this title.
                  ``(C) Severe repetitive-loss property.--The term 
                `severe repetitive-loss property' means a structure 
                that has incurred flood damage for which--
                          ``(i) 4 or more separate claims payments have 
                        been made under flood insurance coverage under 
                        this title, with the amount of each such claim 
                        exceeding $5,000, and with the cumulative 
                        amount of such claims payments exceeding 
                        $20,000; or
                          ``(ii) at least 2 separate claims payments 
                        have been made under flood insurance coverage 
                        under this title, with the cumulative amount of 
                        such claims payments exceeding the value of the 
                        structure.
                  ``(D) Extreme repetitive-loss property.--The term 
                `extreme repetitive-loss property' means a structure 
                that has incurred flood damage for which at least 2 
                separate claims have been made under flood insurance 
                coverage under this title, with the cumulative amount 
                of such claims payments exceeding 150 percent of the 
                maximum coverage amount available for the structure.
          ``(2) Treatment of claims before compliance with state and 
        local requirements.--The Administrator shall not consider 
        claims that occurred before a structure was made compliant with 
        State and local floodplain management requirements for purposes 
        of determining a structure's status as a multiple-loss 
        property.''.
  (b) Premium Adjustment To Reflect Current Flood Risk.--
          (1) In general.--Section 1308 of the National Flood Insurance 
        Act of 1968 (42 U.S.C. 4015), as amended by the preceding 
        provisions of this Act, is further amended by adding at the end 
        the following new subsection:
  ``(o) Premium Adjustment To Reflect Current Flood Risk.--
          ``(1) In general.--Except as provided in paragraph (2), the 
        Administrator shall rate a multiple-loss property that is 
        charged a risk premium rate estimated under section 1307(a)(1) 
        (42 U.S.C. 4014(a)(1)) based on the current risk of flood 
        reflected in the flood insurance rate map in effect at the time 
        of rating.
          ``(2) Adjustment for existing policies.--For policies for 
        flood insurance under this title in force on the date of the 
        enactment of this Act for properties described in paragraph 
        (1)--
                  ``(A) notwithstanding subsection (e) of this section, 
                the Administrator shall increase risk premium rates by 
                not less than 15 percent each year until such rates 
                comply with paragraph (1) of this subsection; and
                  ``(B) any rate increases required by paragraph (1) 
                shall commence following a claim payment for flood loss 
                under coverage made available this title that occurred 
                after the date of enactment of this Act.''.
          (2) Conforming amendment.--Section 1307(g)(2) of the National 
        Flood Insurance Act of 1968 (42 U.S.C. 4014(g)(2)) is amended 
        by striking subparagraph (B) and inserting the following new 
        subparagraph:
                  ``(B) in connection with a multiple-loss property.''.
  (c) Pre-FIRM Multiple-Loss Property.--
          (1) Termination of subsidy.--Section 1307 of the National 
        Flood Insurance Act of 1968 (42 U.S.C. 4014) is amended--
                  (A) in subsection (a)(2)--
                          (i) by striking subparagraph (C) and 
                        inserting the following new subparagraph:
                  ``(C) any extreme repetitive-loss property;'';
                          (ii) in subparagraph (D), by striking ``or'';
                          (iii) in subparagraph (E)--
                                  (I) in clause (i), by striking 
                                ``fair''; and
                                  (II) in clause (ii)--
                                          (aa) by striking ``fair''; 
                                        and
                                          (bb) by striking ``and'' and 
                                        inserting ``or''; and
                          (iv) by adding at the end the following new 
                        subparagraph:
                  ``(F) any repetitive-loss property that has received 
                a claim payment for flood loss under coverage made 
                available under this title that occurred after the date 
                of enactment of this Act; and''; and
                  (B) by striking subsection (h).
          (2) Annual limitation on premium increases.--Subsection (e) 
        of section 1308 of the National Flood Insurance Act of 1968 (42 
        U.S.C. 4015(e)) is amended--
                  (A) in paragraph (3), by striking ``and'' at the end;
                  (B) in paragraph (4), by striking ``described under 
                paragraph (3).'' and inserting ``estimated under 
                section 1307(a)(1); and''; and
                  (C) by adding at the end the following new paragraph:
          ``(5) the chargeable risk premium rates for flood insurance 
        under this title for any properties described in subparagraph 
        (F) of section 1307(a)(2) shall be increased by not less than 
        15 percent each year, until the average risk premium rate for 
        such properties is equal to the average of the risk premium 
        rates for properties estimated under section 1307(a)(1).''.
  (d) Minimum Deductibles for Certain Multiple-Loss Properties.--
          (1) Clerical amendment.--The National Flood Insurance Act of 
        1968, as amended by the preceding provisions of this Act, is 
        further amended--
                  (A) by transferring subsection (b) of section 1312 
                (42 U.S.C. 4019(b)) to section 1306 (42 U.S.C. 4013), 
                inserting such subsection at the end of such section, 
                and redesignating such subsection as subsection (f); 
                and
                  (B) in section 1312 (42 U.S.C. 4019), by 
                redesignating subsection (c) as subsection (b).
          (2) Certain multiple-loss properties.--Subsection (f) of 
        section 1306 of the National Flood Insurance Act of 1968 (42 
        U.S.C. 4013(e)), as so transferred and redesignated by 
        paragraph (1) of this subsection, is amended adding at the end 
        the following new paragraph:
          ``(3) Certain multiple-loss properties.--Notwithstanding 
        paragraph (1) or (2), the minimum annual deductible for damage 
        to any severe repetitive-loss property or extreme repetitive-
        loss property shall be not less than $5,000.''.
  (e) Claim History Validation.--Beginning not later than the 
expiration of the 180-day period beginning on the date of the enactment 
of this Act, the Administrator of the Federal Emergency Management 
Agency shall undertake efforts to validate the reasonable accuracy of 
claim history data maintained pursuant to the National Flood Insurance 
Act of 1968 (42 U.S.C. 4001 et seq.).
  (f) Increased Cost of Compliance Coverage.--Paragraph (1) of section 
1304(b) of the National Flood Insurance Act of 1968 (42 U.S.C. 
4011(b)(1)) is amended by striking ``repetitive loss structures'' and 
inserting ``multiple-loss properties''.
  (g) Availability of Insurance for Multiple-Loss Properties.--
          (1) In general.--The National Flood Insurance Act of 1968 is 
        amended by inserting after section 1304 (42 U.S.C. 4011) the 
        following new section:

``SEC. 1304A. AVAILABILITY OF INSURANCE FOR MULTIPLE-LOSS PROPERTIES.

  ``(a) Date and Information Identifying Current Flood Risk.--The 
Administrator may provide flood insurance coverage under this title for 
a multiple-loss property only if the owner of the property submits to 
the Administrator such data and information necessary to determine such 
property's current risk of flood, as determined by the Administrator, 
at the time of application for or renewal of such coverage.
  ``(b) Refusal To Mitigate.--
          ``(1) In general.--Except as provided pursuant to paragraph 
        (2), the Administrator may not make flood insurance coverage 
        available under this title for any extreme repetitive-loss 
        property for which a claim payment for flood loss was made 
        under coverage made available under this title that occurred 
        after the date of enactment of the 21st Century Flood Reform 
        Act if the property owner refuses an offer of mitigation for 
        the property under section 1366(a)(2) (42 U.S.C. 4104c(a)(2)).
          ``(2) Exceptions; appeals.--The Director shall develop 
        guidance to provide appropriate exceptions to the prohibition 
        under paragraph (1) and to allow for appeals to such 
        prohibition.''.
          (2) Effective date.--Section 1304A of the National Flood 
        Insurance Act of 1968, as added by paragraph (1) of this 
        subsection, shall apply beginning upon the expiration of the 
        12-month period beginning on the date of the enactment of this 
        Act.
  (h) Rates for Properties Newly Mapped Into Areas With Special Flood 
Hazards.--Subsection (i) of section 1308 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4015(i)) is amended--
          (1) by striking the subsection designation and all that 
        follows through ``Notwithstanding'' and inserting the 
        following:
  ``(i) Rates for Properties Newly Mapped Into Areas With Special Flood 
Hazards.--
          ``(1) In general.--Except as provided in paragraph (2) and 
        notwithstanding'';
          (2) by redesignating paragraphs (1) and (2) as subparagraphs 
        (A) and (B), respectively, and moving the left margins of such 
        subparagraphs, as so redesignated, and the matter following 
        subparagraph (B), 2 ems to the right; and
          (3) by adding at the end the following new paragraph:
          ``(2) Inapplicability to multiple-loss properties.--Paragraph 
        (1) shall not apply to multiple-loss properties.''.
  (i) Clear Communication of Multiple-Loss Property Status.--
          (1) In general.--Subsection (l) of section 1308 of the 
        National Flood Insurance Act of 1968 (42 U.S.C. 4015(l)), as 
        amended by the preceding provisions of this Act, is further 
        amended by adding at the end the following new paragraph:
          ``(2) Multiple-loss properties.--Pursuant to paragraph (1), 
        the Administrator shall clearly communicate to all 
        policyholders for multiple-loss properties the effect on the 
        premium rates charged for such a property of filing any further 
        claims under a flood insurance policy with respect to that 
        property.''.
  (j) Mitigation Assistance Program.--Section 1366 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4104c) is amended--
          (1) in subsection (a)--
                  (A) in the matter preceding paragraph (1), by 
                inserting after the period at the end of the first 
                sentence the following: ``Priority under the program 
                shall be given to providing assistance with respect to 
                multiple-loss properties.'';
                  (B) in paragraph (1), by inserting ``and'' after the 
                semicolon at the end; and
                  (C) by striking paragraphs (2) and (3) and inserting 
                the following:
          ``(2) to property owners, in coordination with the State and 
        community, in the form of direct grants under this section for 
        carrying out mitigation activities that reduce flood damage to 
        extreme repetitive-loss properties.
The Administrator shall take such actions as may be necessary to ensure 
that grants under this subsection are provided in a manner that is 
consistent with the delivery of coverage for increased cost of 
compliance provided under section 1304(b).'';
          (2) in subsection (c)(2)(A)(ii), by striking ``severe 
        repetitive loss structures'' and inserting ``multiple-loss 
        properties'';
          (3) in subsection (d)--
                  (A) in paragraph (1)--
                          (i) by striking ``Severe repetitive loss 
                        structures'' and inserting ``Extreme 
                        repetitive-loss properties''; and
                          (ii) by striking ``severe repetitive loss 
                        structures'' and inserting ``extreme 
                        repetitive-loss properties'';
                  (B) in paragraph (2)--
                          (i) by striking ``Repetitive loss 
                        structures'' and inserting ``Severe repetitive-
                        loss properties'';
                          (ii) by striking ``repetitive loss 
                        structures'' and inserting ``severe repetitive-
                        loss properties''; and
                          (iii) by striking ``90 percent'' and 
                        inserting ``100 percent'';
                  (C) by redesignating paragraph (3) as paragraph (4); 
                and
                  (D) by inserting after paragraph (2) the following 
                new paragraph:
          ``(3) Repetitive-loss property.--In the case of mitigation 
        activities to repetitive-loss properties, in an amount up to 
        100 percent of all eligible costs.'';
          (4) in subsection (h)--
                  (A) by striking paragraphs (2) and (3);
                  (B) by striking the subsection designation and all 
                that follows through ``shall apply:''; and
                  (C) in paragraph (1)--
                          (i) by striking ``Community'' and inserting 
                        ``Definition of Community'';
                          (ii) by striking ``The'' and inserting ``For 
                        purposes of this section, the'';
                          (iii) by redesignating such paragraph as 
                        subsection (j);
                          (iv) in subparagraph (B), by striking 
                        ``subparagraph (A)'' and inserting ``paragraph 
                        (1)'';
                          (v) by redesignating subparagraphs (A) and 
                        (B) as paragraphs (1) and (2), respectively;
                          (vi) in paragraph (1), as so redesignated by 
                        clause (v) of this subparagraph, by 
                        redesignating clauses (i) and (ii) as 
                        subparagraphs (A) and (B), respectively (and 
                        moving the margins two ems to the left); and
                          (vii) by moving the left margins of 
                        subsection (j) (as so redesignated) and 
                        paragraphs (1) and (2), all as so redesignated, 
                        two ems to the left; and
          (5) by inserting after subsection (g) the following new 
        subsections:
  ``(h) Alignment With Increased Cost of Compliance.--Notwithstanding 
any provision of law, any funds appropriated for assistance under this 
title may be transferred to the National Flood Insurance Fund 
established under section 1310 (42 U.S.C. 4017) for the payment of 
claims to enable the Administrator to deliver grants under subsection 
(a)(2) of this section to align with the delivery of coverage for 
increased cost of compliance for extreme repetitive-loss properties.
  ``(i) Funding.--
          ``(1) Authorization of appropriations.--Notwithstanding any 
        other provision of law, assistance provided under this section 
        shall be funded by--
                  ``(A) $225,000,000 in each fiscal year, subject to 
                offsetting collections, through risk premium rates for 
                flood insurance coverage under this title, and shall be 
                available subject to section 1310(f);
                  ``(B) any penalties collected under section 102(f) 
                the Flood Disaster Protect Act of 1973 (42 U.S.C. 
                4012a(f); and
                  ``(C) any amounts recaptured under subsection (e) of 
                this section.
        The Administrator may not use more than 5 percent of amounts 
        made available under this subsection to cover salaries, 
        expenses, and other administrative costs incurred by the 
        Administrator to make grants and provide assistance under this 
        section.
          ``(2) Availability.--Amounts appropriated pursuant to this 
        subsection for any fiscal year may remain available for 
        obligation until expended.''.
  (k) Repeal.--Section 1367 of the National Flood Insurance Act of 1968 
(42 U.S.C. 4104d) is repealed.

SEC. 505. ELIMINATION OF COVERAGE FOR PROPERTIES WITH EXCESSIVE 
                    LIFETIME CLAIMS.

  Section 1305 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4012) is amended by adding at the end the following new subsection:
  ``(e) Prohibition of Coverage for Properties With Excessive Lifetime 
Claims.--After the expiration of the 18-month period beginning on the 
date of the enactment of this subsection, the Administrator may not 
make available any new or renewed coverage for flood insurance under 
this title for any multiple-loss property for which the aggregate 
amount in claims payments that have been made after the expiration of 
such period under flood insurance coverage under this title exceeds 
twice the amount of the replacement value of the structure.''.

SEC. 506. ADDRESSING TOMORROW'S HIGH-RISK STRUCTURES TODAY.

  (a) In General.--The National Flood Insurance Act of 1968 is 
amended--
          (1) in section 1305 (42 U.S.C. 4012), as amended by the 
        preceding provisions of this Act, by adding at the end the 
        following new subsections:
  ``(f) Reducing Future Risks of the National Flood Insurance Fund.--
          ``(1) Prohibition of new coverage for high-risk properties.--
        Except as provided in subsection (g) and notwithstanding any 
        other provision of this title, in carrying out the fiduciary 
        responsibility to the National Flood Insurance Program under 
        section 1309(e) (42 U.S.C. 4016(e)) and to reduce future risks 
        to the National Flood Insurance Fund, on or after January 1, 
        2021, the Administrator may not make available flood insurance 
        coverage under this title as follows:
                  ``(A) New structures added to flood hazard zones.--
                Any new coverage for any property for which new 
                construction is commenced on or after such date and 
                that, upon completion of such construction, is located 
                in an area having special flood hazards.
                  ``(B) Structures with high-value replacement costs.--
                Any new or renewed coverage for any residential 
                property having 4 or fewer residences and a replacement 
                value of the structure, at the time, exclusive of the 
                value of the real estate on which the structure is 
                located, that is equal to or exceeds the amount that is 
                equal to $1,000,000 multiplied by the number of 
                dwelling units in the structure (as such amount is 
                adjusted pursuant to clause (i)), subject to the 
                following provisions:
                          ``(i) Adjustment of amounts.--The dollar 
                        amount in the matter of this subparagraph that 
                        precedes this clause (as it may have been 
                        previously adjusted) shall be adjusted for 
                        inflation by the Administrator upon the 
                        expiration of the 5-year period beginning upon 
                        the enactment of this subsection and upon the 
                        expiration of each successive 5-year period 
                        thereafter, in accordance with an inflationary 
                        index selected by the Administrator.
                          ``(ii) Valuation.--The Administrator shall 
                        determine the replacement value of a property 
                        for purposes of this subparagraph using such 
                        valuation methods or indicia as the 
                        Administrator determines are reasonably 
                        accurate, consistent, reliable, and available 
                        for such purposes.
          ``(2) Actuarial structures with hidden risks.--For any 
        property with risk premium rates estimated under section 
        1307(a)(1), on or after January 1, 2021, the Administrator 
        shall charge risk premium rates based on the current risk of 
        flood reflected in the flood insurance rate map or comparable 
        risk rating metric in effect at the time a policy is newly 
        issued, unless the newly issued policy covers a property with 
        continuous flood insurance coverage under this title, or upon 
        the renewal of a policy. For all such policy renewals, the 
        Administrator shall increase the risk premium rate in 
        accordance with section 1308(e)(2) until the risk premium rate 
        is equal to the risk of flood reflected in the flood insurance 
        rate map or comparable risk rating metric in effect at the time 
        of renewal.
          ``(3) Implementation.--The Administrator may implement this 
        subsection without rulemaking, except that any such 
        implementation shall include advance publication of notice in 
        the Federal Register or advance notice by another comparable 
        method, such as posting on an official website of the 
        Administrator.
  ``(g) Availability of Otherwise Prohibited Flood Insurance Coverage 
Where Private Market Coverage Is Unavailable.--
          ``(1) In general.--The Administrator may make available flood 
        insurance coverage under this Act for a property described in 
        subparagraph (A) or (B) of subsection (f)(1), notwithstanding 
        subsection (f) of this section, if, within the 30-day period 
        beginning upon submission to the Clearinghouse established 
        pursuant to section 1350 of an application for flood insurance 
        coverage for such property, the Clearinghouse does not provide 
        the applicant with one or more bona fide offers for private 
        flood insurance coverage for such property.
          ``(2) Surcharge.--Any flood insurance coverage made available 
        for a property pursuant to this subsection shall be made 
        available at chargeable premium rates otherwise determined 
        under this title for such property, except that the 
        Administrator shall impose and collect a surcharge for such 
        coverage in an amount equal to 10 percent of such chargeable 
        premium rate, which shall be deposited into the National Flood 
        Insurance Fund established under section 1310.''; and
          (2) in section 1306(a)(1) (42 U.S.C. 4013(a)(1)), by 
        inserting ``, subject to subsections (f) and (g) of section 
        1305'' before the semicolon at the end.
  (b) Study of Flood Insurance Clearinghouse.--
          (1) In general.--The Administrator of the Federal Emergency 
        Management Agency (in this subsection referred to as the 
        ``Administrator'') shall conduct a study--
                  (A) to analyze the feasibility and effectiveness, and 
                problems involved, in establishing, maintaining, and 
                operating a Flood Insurance Clearinghouse in accordance 
                with section 1350 of the National Flood Insurance Act 
                of 1968 (as added by the amendment made by subsection 
                (c) of this section); and
                  (B) to develop a plan and guidelines for 
                establishment, design, and operation of such a 
                Clearinghouse
          (2) Report.--Not later than the expiration of the two-year 
        period beginning on the date of the enactment of this Act, the 
        Administrator shall submit a report to the Committee on 
        Financial Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the Senate 
        that sets forth the analysis, conclusions, and recommendations 
        resulting from the study under this section. Such report shall 
        include a plan for establishment, design, and operation of the 
        Flood Insurance Clearinghouse, and guidelines for such 
        Clearinghouse, sufficient to provide for commencement of 
        operations of the Clearinghouse under section 1350 of the 
        National Flood Insurance Act of 1968.
  (c) Establishment of Clearinghouse.--Part C of chapter II of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4081 et seq.), as 
amended by the preceding provisions of this Act, is further amended by 
adding at the end the following new section:

``SEC. 1350. FLOOD INSURANCE CLEARINGHOUSE.

  ``(a) Establishment and Operations.--Not later than January 1, 2021, 
the Administrator shall establish and commence operations of a Flood 
Insurance Clearinghouse (in this section referred to as the 
`Clearinghouse)' in accordance with the report, plan, and guidelines 
required under section 506(b)(2) of the 21st Century Flood Reform Act.
  ``(b) Purpose.--The Clearinghouse shall be established for the 
purpose of receiving applications from prospective insureds for flood 
insurance coverage for properties for which such coverage is prohibited 
under section 1305(f) of the National Flood Insurance Act of 1968 (42 
U.S.C. 4012(f)) and for providing to such applicants offers for such 
coverage from insurers providing private flood insurance (as such term 
is defined for purposes of section 102(c) of the Flood Disaster 
Protection Act of 1973 (42 U.S.C. 4012a(c)) and, subject to the 
limitations in this section, for coverage made available under the 
National Flood Insurance Program.
  ``(c) Functions.--The Clearinghouse shall have as its functions--
          ``(1) to provide for prospective insureds to submit to the 
        Clearinghouse applications for flood insurance coverage for 
        properties described in subsection (b);
          ``(2) to determine, with respect to a property identified in 
        an application, the chargeable premium rate for coverage made 
        available under this title;
          ``(3) with respect to a property identified in an 
        application, to solicit offers of coverage under private flood 
        insurance from providers of such insurance during a reasonable 
        period of time after such application, which offers shall 
        provide terms and conditions of insurance, including 
        deductibles and exclusions, that are sufficient to meet the 
        requirements of section 102 of the Flood Disaster Protection 
        Act of 1973 (42 U.S.C. 4012a); and
          ``(4) to provide to the applicant for insurance--
                  ``(A) any bona fide offers for private insurance 
                coverage made pursuant to paragraph (3) for the 
                property identified in the application;
                  ``(B) in the case only of a property for which such 
                coverage is authorized pursuant to subsection (g) of 
                section 1305, a bona fide offer for flood insurance 
                coverage made available under this title for the 
                property; and
                  ``(C) information to help the applicant for insurance 
                understand such offers and the limitation under section 
                1305(g);
  ``(d) Management and Operation.--The Clearinghouse shall be managed 
and operated by a third party pursuant to a contract with the 
Administrator.
  ``(e) Agreements.--The Administrator may enter into such agreements 
with insurers providing private flood insurance coverage as may be 
necessary for the Clearinghouse to carry out its functions.
  ``(f) Fees.--The Clearinghouse may charge a fee to applicants to 
cover administrative costs of the Clearinghouse.
  ``(g) Reports.--The Clearinghouse shall report periodically, as 
determined by the Administrator, to the Administrator regarding the 
operations and activities of the Clearinghouse.''.

SEC. 507. PAY FOR PERFORMANCE AND STREAMLINING COSTS AND REIMBURSEMENT.

   Section 1345 of the National Flood Insurance Act of 1968 (42 U.S.C. 
4081), as amended by the preceding provisions of this Act, is further 
amended by adding at the end the following subsection:
  ``(g) Write Your Own Allowance and Program Savings.--
          ``(1) Allowance rate.--
                  ``(A) Limitation.--The allowance paid to companies 
                participating in the Write Your Own Program (as such 
                term is defined in section 1370 (42 U.S.C. 4004)) with 
                respect to a policy for flood insurance coverage made 
                available under this title shall not be greater than 
                27.9 percent of the chargeable premium for such 
                coverage.
                  ``(B) Inapplicability.--Subparagraph (A) shall not 
                apply to actual and necessary costs related to section 
                1312(a) (42 U.S.C, 4019(a)), or to payments deemed 
                necessary by the Administrator.
                  ``(C) Implementation.--The limitation in subparagraph 
                (A) shall be imposed by equal reductions over the 3-
                year period beginning on the date of the enactment of 
                this subsection.
          ``(2) Program savings.--
                  ``(A) Implementation.--The Administrator, within 
                three years of the date of the enactment of this Act, 
                shall reduce the costs and unnecessary burdens for the 
                companies participating in the Write Your Own program 
                by at least half of the amount by which the limitation 
                under paragraph (1)(A) reduced costs compared to the 
                costs as of the date of the enactment of this 
                subsection.
                  ``(B) Consideration of savings.--In meeting the 
                requirement of subparagraph (A), the Administrator 
                shall consider savings including--
                          ``(i) indirect payments by the Administrator 
                        of premium;
                          ``(ii) eliminating unnecessary communications 
                        requirements;
                          ``(iii) reducing the frequency of National 
                        Flood Insurance Program changes;
                          ``(iv) simplifying the flood rating system; 
                        and
                          ``(v) other ways of streamlining the Program 
                        to reduce costs while maintaining customer 
                        service and distribution.''.

SEC. 508. ENFORCEMENT OF MANDATORY PURCHASE REQUIREMENTS.

  (a) Penalties.--Paragraph (5) of section 102(f) of the Flood Disaster 
Protection Act of 1973 (42 U.S.C. 4012a(f)(5)) is amended by striking 
``$2,000'' and inserting ``$5,000''.
  (b) Insured Depository Institutions.--Subparagraph (A) of section 
10(i)(2) of the Federal Deposit Insurance Act (12 U.S.C. 1820(i)(2)(A)) 
is amended by striking ``date of enactment of the Riegle Community 
Development and Regulatory Improvement Act of 1994 and biennially 
thereafter for the next 4 years'' and inserting ``date of enactment of 
the 21st Century Flood Reform Act and biennially thereafter''.
  (c) Credit Unions.--Subparagraph (A) of section 204(e)(2) of the 
Federal Credit Union Act (12 U.S.C. 1784(e)(2)(A)) is amended by 
striking ``date of enactment of the Riegle Community Development and 
Regulatory Improvement Act of 1994 and biennially thereafter for the 
next 4 years'' and inserting ``date of enactment of the 21st Century 
Flood Reform Act and annually thereafter''.
  (d) Government-Sponsored Enterprises.--Paragraph (4) of section 
1319B(a) of the Federal Housing Enterprises Financial Safety and 
Soundness Act of 1992 (12 U.S.C. 4521(a)(4)) is amended, in the matter 
after and below subparagraph (B), by striking ``first, third, and fifth 
annual reports under this subsection required to be submitted after the 
expiration of the 1-year period beginning on the date of enactment of 
the Riegle Community Development and Regulatory Improvement Act of 
1994'' and inserting ``first annual report under this subsection 
required to be submitted after the expiration of the 1-year period 
beginning on the date of enactment of the 21st Century Flood Reform Act 
and every such second annual report thereafter''.
  (e) Mandatory Purchase Study; Guidelines.--
          (1) Study.--
                  (A) In general.--The Comptroller General of the 
                United States shall conduct a study of the 
                implementation and efficacy of the requirements of 
                section 102 of the Flood Disaster Protection Act of 
                1973 (42 U.S.C. 4012a). Such study shall at minimum 
                consider the following questions:
                          (i) How effectively do Federal agencies, 
                        regulated lending institutions, and Federal 
                        entities for lending regulation implement the 
                        requirements of section 102 of the Flood 
                        Disaster Protection Act of 1973?
                          (ii) Does the current implementation of Flood 
                        Disaster Protection Act of 1973 align with the 
                        congressional findings and purposes described 
                        in section 2(b) of such Act (42 U.S.C. 4002)?
                          (iii) What, if any, unintended consequences 
                        have resulted from the requirements and 
                        implementation of section 102 of such Act?
                  (B) Report.--Not later than the expiration of the 18-
                month period beginning on the date of the enactment of 
                this Act, the Comptroller General shall submit a report 
                to the Committee on Financial Services of the House of 
                Representatives and the Committee on Banking, Housing, 
                and Urban Affairs of the Senate regarding the findings 
                and conclusions of the study conducted pursuant to this 
                paragraph.
          (2) Guidelines.--The Federal entities for lending regulation 
        (as such term is defined in section 3(a) of the Flood Disaster 
        Protection Act of 1973 (42 U.S.C. 4003(a))), in consultation 
        with the Administrator of the Federal Emergency Management 
        Agency, shall jointly update and reissue the rescinded document 
        of the Administrator entitled ``Mandatory Purchase of Flood 
        Insurance Guidelines'' (lasted updated on October 29, 2014). 
        The updated document shall incorporate recommendations made by 
        the Comptroller General pursuant to paragraph (1) of this 
        subsection.

SEC. 509. SATISFACTION OF MANDATORY PURCHASE REQUIREMENT IN STATES 
                    ALLOWING ALL-PERILS POLICIES.

  Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 
4012a) is amended--
          (1) in subsection (a), by striking ``After'' and inserting 
        ``Subject to subsection (i) of this section, after'';
          (2) in subsection (b)--
                  (A) in paragraph (1), by striking ``Each'' and 
                inserting ``Subject to subsection (i) of this section, 
                each'';
                  (B) in paragraph (2), by striking ``Each'' the first 
                place such term appears and inserting ``Subject to 
                subsection (i) of this section, A''; and
                  (C) in paragraph (3), by striking ``The'' the first 
                place such term appears and inserting ``Subject to 
                subsection (i) of this section, the'';
          (3) in subsection (e)(1), by striking ``If'' and inserting 
        ``Subject to subsection (i) of this section, if''; and
          (4) by adding at the end the following new subsection:
  ``(i) Satisfaction of Mandatory Purchase Requirement in States 
Allowing All-perils Policies.--
          ``(1) Waivers.--Section 102 shall not apply with respect to 
        residential properties in any State that allows any property 
        insurance coverage that covers `all-perils' except specifically 
        excluded perils that includes coverage for flood perils in an 
        amount at least equal to the outstanding principal balance of 
        the loan or the maximum limit of flood insurance coverage made 
        available under this title with respect to such type of 
        residential property, whichever is less.
          ``(2) Definitions, procedures, standards.--The Administrator 
        may establish such definitions, procedures, and standards as 
        the Administrator considers necessary for making determinations 
        under paragraph (1).''.

SEC. 510. FLOOD INSURANCE PURCHASE REQUIREMENTS.

  Section 102 of the Flood Disaster Protection Act of 1973 (42 U.S.C. 
4012a), as amended by the preceding provisions of this Act, is further 
amended--
          (1) in subsection (c)(2)(A), by striking ``$5,000 or less'' 
        and inserting the following: ``$25,000 or less, except that 
        such amount (as it may have been previously adjusted) shall be 
        adjusted for inflation by the Administrator upon the expiration 
        of the 5-year period beginning upon the enactment of the 21st 
        Century Flood Reform Act and upon the expiration of each 
        successive 5-year period thereafter, in accordance with an 
        inflationary index selected by the Administrator''; and
          (2) by adding at the end the following new subsection:
  ``(j) Flood Insurance Purchase Requirements.--Notwithstanding any 
other provision of law, a State or local government or private lender 
may require the purchase of flood insurance coverage for a structure 
that is located outside of an area having special flood hazards.''.

SEC. 511. CLARIFICATIONS; DEADLINE FOR APPROVAL OF CLAIMS.

  (a) Rules of Construction.--Part C of chapter II of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4081 et seq.), as amended by the 
preceding provisions of this Act, is further amended by adding at the 
end the following new section:

``SEC. 1351. RULES OF CONSTRUCTION.

  ``(a) Definition.--For purposes of this part, the term `knowingly' 
means having actual knowledge of or acting with deliberate ignorance of 
or reckless disregard for the prohibitions under this part.
  ``(b) Administrative Remedy.--A policyholder of a policy for flood 
insurance coverage made available under this title must exhaust all 
administrative remedies, including submission of disputed claims to 
appeal under any appeal process made available by the Administrator, 
prior to commencing legal action on any disputed claim under such a 
policy.''.
  (b) Deadline for Approval of Claims.--
          (1) In general.--Section 1312 of the National Flood Insurance 
        Act of 1968 (42 U.S.C. 4019), as amended by the preceding 
        provisions of this Act, is further amended--
                  (A) in subsection (a), by striking ``The 
                Administrator'' and inserting ``Subject to other 
                provisions of this section, the Administrator''; and
                  (B) by adding at the end the following new 
                subsection:
  ``(c) Deadline for Approval of Claims.--
          ``(1) In general.--The Administrator shall provide that, in 
        the case of any claim for damage to or loss of property under 
        flood insurance coverage made available under this title, an 
        initial determination regarding approval of a claim for payment 
        or disapproval of the claim be made, and notification of such 
        determination be provided to the insured making such claim, not 
        later than the expiration of the 120-day period (as such period 
        may be extended pursuant to paragraph (2)) beginning upon the 
        day on which the policyholder submits a signed proof of loss 
        detailing the damage and amount of the loss. Payment of 
        approved claims shall be made as soon as possible after such 
        approval.
          ``(2) Extension of deadline.--The Administrator shall provide 
        that the period referred to in paragraph (1) may be extended by 
        a single additional period of 15 days in cases where 
        extraordinary circumstances are demonstrated. The Administrator 
        shall, by regulation, establish criteria for demonstrating such 
        extraordinary circumstances and for determining to which claims 
        such extraordinary circumstances apply.''.
          (2) Applicability.--The amendments made by paragraph (1) 
        shall apply to any claim under flood insurance coverage made 
        available under the National Flood Insurance Act of 1968 (42 
        U.S.C. 4001 et seq.) pending on the date of the enactment of 
        this Act and any claims made after such date of enactment.

SEC. 511. GAO STUDY OF SIMPLIFICATION OF NATIONAL FLOOD INSURANCE 
                    PROGRAM.

  (a) Study.--The Comptroller General of the United States shall 
conduct a study of options for simplifying flood insurance coverage 
made available under the National Flood Insurance Act, which shall 
include the following:
          (1) An analysis of how the administration of the National 
        Flood Insurance Program can be simplified--statutorily, 
        regulatorily, and administratively--for private flood insurance 
        policyholders, companies, agents, mortgage lenders, and flood 
        insurance vendors.
          (2) An assessment of ways in which flood insurance coverage 
        made available under the National Flood Insurance Act and the 
        program for providing and administrating such coverage may be 
        harmonized with private insurance industry standards.
          (3) Identification and analysis of ways in which the 
        structure of the National Flood Insurance Program may be 
        simplified, including analysis of the efficacy and effects each 
        of the following actions:
                  (A) Eliminating the use of two deductibles under the 
                Program.
                  (B) Including in claims for flood-damages full 
                replacement cost for property not damaged, but rendered 
                unusable, by the flooding.
                  (C) Using umbrella policies that allow multiple 
                structures on a property to be insured under the same 
                policy.
  (b) Report.--Not later than the expiration of the 18-month period 
beginning on the date of the enactment of this Act, the Comptroller 
General shall submit a report to the Committee on Financial Services of 
the House of Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate regarding the findings and conclusions of 
the study conducted pursuant to this section.

                          Purpose and Summary

    Introduced by Representative Sean Duffy on June 12, 2017, 
H.R. 2874, the ``21st Century Flood Reform Act,'' would achieve 
reforms to improve the financial stability of the National 
Flood Insurance Program, to enhance the development of more 
accurate estimates of flood risk through new technology and 
better maps, to increase the role of private markets in the 
management of flood insurance risks, and to provide for 
alternative methods to insure against flood peril.

                  Background and Need for Legislation

    Floods are among the most frequently occurring and costly 
natural disasters. Most declarations of federal disasters by 
the Federal Emergency Management Agency (FEMA) are related to 
flooding. Yet despite the frequency and severity of losses that 
result from flooding, the private insurance market generally 
did not provide insurance for flooding; when it did, insurance 
for flood-related damage can be expensive because the 
properties most at-risk tend to be highly concentrated 
geographically and the potential risk of economic losses is 
extremely high.
    To supplement the availability of flood insurance in the 
private market, Congress, in 1968, created the National Flood 
Insurance Program (NFIP), which is administered by FEMA and 
provides flood insurance to approximately 5 million 
policyholders across the country. In exchange for premiums paid 
by policyholders, NFIP makes federally backed flood insurance 
available to homeowners and other property owners (for example, 
businesses, churches, and farmers) in these communities.
    Homeowners with mortgages held by federally regulated 
lenders on property in participating communities identified by 
FEMA to be in Special Flood Hazard Areas are required to 
purchase flood insurance (mandatory purchase requirement). NFIP 
coverage limits vary by program (regular or emergency) and 
property type (for example, residential or nonresidential). In 
NFIP's regular program, the maximum coverage limits for 
residential policyholders are $250,000 for buildings and 
$100,000 for contents. For commercial policyholders (that is, 
those with policies for nonresidential properties), the maximum 
coverage limit is $500,000 per building and $500,000 for 
contents owned by the building owner. There is additional 
coverage for contents owned by the tenants.
    Residents and business owners in over 22,000 participating 
communities across the United States and its territories are 
able to buy NFIP flood insurance policies through insurance 
agents and companies that participate as third-party 
administrators in the ``Write Your Own'' (WYO) program. The WYO 
program allows private insurance carriers to issue and service 
government underwritten and taxpayer backed NFIP policies with 
no private financial liability from the insurer. Insurance 
companies that participate in the WYO program receive an 
expense allowance for policies they write and the claims they 
process. In addition, their agents earn a commission for the 
policies they sell. The federal government, however, retains 
responsibility for managing the risk and paying claims, as well 
as covering any litigation costs should a WYO insurer be sued 
in court.
    Property owners can purchase flood insurance through the 
NFIP only if their communities participate in the NFIP. To 
participate in the NFIP, a community must agree to abide by 
certain statutory provisions intended to mitigate the risk of 
flooding, such as building codes that require new structures 
built in floodplains (high-risk areas) to be protected against 
flooding or to be elevated above the 100-year floodplain.
    As of June 5, 2017, the NFIP has an outstanding debt of 
$24.6 billion borrowed from taxpayers, with roughly $1.1 
billion available cash-on-hand and $5.825 billion remaining of 
its total temporary $30.425 billion Treasury borrowing 
authority. The NFIP's debt results primarily from its borrowing 
to pay claims as a result of the Gulf Coast hurricanes in 2005 
and Superstorm Sandy in October 2012. This borrowing stems from 
a structural imbalance in how the NFIP measures and prices for 
risk, resulting in only 46 percent of premium dollars collected 
in 2016 being available for the payments of claims. With such a 
low portion of premiums available to pay claims, the pressure 
on the NFIP to borrow from taxpayers increases. The NFIP's 
structural budget crisis has required periodic legislation to 
increase its borrowing authority, the most recent example of 
which occurred in January 2013 when Congress increased the 
NFIP's borrowing authority by $9.7 billion from $20.725 billion 
to its current $30.425 billion level.
    H.R. 2874 reauthorizes the NFIP for five years; provides 
much needed reforms to ensure it is financially sustainable; 
enhances incentives and approaches to reduce future flood 
damages and vulnerabilities; and, ensures that a greater 
portion of premiums collected are available to pay claims that 
ultimately result in better protection for taxpayers who have 
repeatedly backstopped the program.
    Instead of operating on an actuarial basis, the NFIP 
operates on a series of explicit and implicit subsidies, 
allowing some to pay less while many pay more than their actual 
flood risk would require. Meanwhile, there is high customer 
dissatisfaction with the NFIP's operations and flood map 
approval. Claims payments have remained high; and, over time 
there has been a disproportionate growth in the amount and 
number of claims with each new storm and the flood damage that 
follows.
    Through a series of incremental reforms, such as moving the 
program towards risk based rates, ensuring the proper 
maintenance of the program's reserve fund, addressing 
properties that perpetually flood, and providing more 
transparency to the mapping process, H.R. 2874 will help 
protect taxpayers and restore the NFIP's financial ledger and 
provide certainty to the flood insurance marketplace over the 
next five years.

                                Hearings

    The Committee on Financial Services' Subcommittee on 
Housing & Insurance held two hearings examining matters 
relating to H.R. 2874 on March 9, 2017 and March 16, 2017. The 
Committee on Financial Services held a hearing examining 
matters relating to H.R. 2874 on June 7, 2017.

                        Committee Consideration

    The Committee on Financial Services met in open session on 
June 15, 2017 to consider H.R. 2874. Sundry amendments were 
considered and adopted as described below. The Committee 
ordered H.R. 2874 to be reported favorably to the House, as 
amended, by a recorded vote of 30 ayes and 26 nays (recorded 
vote no. FC-63), a quorum being present.
    Before the motion to report was offered, the Committee 
adopted by voice vote an amendment offered by Mr. Duffy (no. 1) 
and an amendment offered by Ms. Moore (no. 8). As described 
below, the Committee also adopted an amendment by Ms. Tenney 
(no. 7) by recorded vote.

                            Committee Votes

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires the Committee to list the record votes 
on the motion to report legislation and amendments thereto. 
Amendments were disposed of as follows:
    Heck Amendment (no. 2) was not agreed to by a vote of 26 
yeas and 29 nays (Recorded vote no. FC-59)
    Crist Amendment (no. 6) was not agreed to by a vote of 26 
yeas and 30 nays (Recorded vote no. FC-60)
    Tenney Amendment (no. 7) was agreed to by a recorded vote 
of 31 yeas and 25 nays (Recorded vote no. FC-61)
    Waters Amendment in the Nature of a Substitute (no. 9) was 
not agreed to by a recorded vote of 25 yeas and 31 nays 
(Recorded vote no. FC-62)

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]

                      Committee Oversight Findings

    Pursuant to clause 3(c)(1) of rule XIII of the Rules of the 
House of Representatives, the findings and recommendations of 
the Committee based on oversight activities under clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
are incorporated in the descriptive portions of this report.

                    Performance Goals and Objectives

    Pursuant to clause 3(c)(4) of rule XIII of the Rules of the 
House of Representatives, the Committee states that H.R. 2874 
will achieve reforms to improve the financial stability of the 
National Flood Insurance Program, to enhance the development of 
more accurate estimates of flood risk through new technology 
and better maps, to increase the role of private markets in the 
management of flood insurance risks, and to provide for 
alternative methods to insure against flood peril.

   New Budget Authority, Entitlement Authority, and Tax Expenditures

    In compliance with clause 3(c)(2) of rule XIII of the Rules 
of the House of Representatives, the Committee adopts as its 
own the estimate of new budget authority, entitlement 
authority, or tax expenditures or revenues contained in the 
cost estimate prepared by the Director of the Congressional 
Budget Office pursuant to section 402 of the Congressional 
Budget Act of 1974.

                        Committee Cost Estimate

    The Committee adopts as its own the cost estimate prepared 
by the Director of the Congressional Budget Office pursuant to 
section 402 of the Congressional Budget Act of 1974.

                 Congressional Budget Office Estimates

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                 Washington, DC, September 8, 2017.
Hon. Jeb Hensarling,
Chairman, Committee on Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 2874, the 21st 
Century Flood Reform Act.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Robert Reese.
            Sincerely,
                                                Keith Hall,
                                                          Director.
    Enclosure.

H.R. 2874--21st Century Flood Reform Act

    Summary: H.R. 2874 would authorize the National Flood 
Insurance Program (NFIP), which is administered by the Federal 
Emergency Management Agency (FEMA), to enter into and renew 
flood insurance policies through fiscal year 2022. Under 
current law, that authority will expire after December 8, 2017.
    The legislation also would make a number of changes to the 
NFIP aimed at improving the financial status of the program and 
encouraging the growth of a private market for flood insurance. 
CBO estimates that the changes made by this legislation would 
increase collections from NFIP policyholders but would reduce 
the number of property owners who purchase insurance through 
the NFIP. On net, CBO estimates that the changes made by H.R. 
2874 would reduce direct spending by $187 million over the 
2018-2027 period. CBO also estimates that enacting H.R. 2874 
would increase revenues by about $4 million over the 2018-2027 
period.
    H.R. 2874 also would authorize FEMA to perform activities 
related to the flood insurance program, such as making grants 
for flood mitigation, administering a state affordability 
program, updating the process for appealing flood map 
information, implementing an independent actuarial review of 
the program, operating a flood insurance clearinghouse, and 
starting a pilot program for offering community-based flood 
insurance. The cost of some of those activities would be offset 
by fees paid by policyholders; however, CBO estimates that 
implementing other provisions would cost $75 million over the 
2018-2022 period, subject to the appropriation of the 
authorized and necessary amounts.
    Pay-as-you-go procedures apply because enacting the 
legislation would affect direct spending and revenues.
    CBO estimates that enacting H.R. 2874 would not increase 
net direct spending or on-budget deficits by more than $5 
billion in any of the four consecutive 10-year periods 
beginning in 2028.
    H.R. 2874 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA).
    Estimated Cost to the Federal Government: The budgetary 
impact of H.R. 2874 would fall within budget function 450, 
community and regional development (see Table 1).

                                              TABLE 1.--SUMMARY OF ESTIMATED BUDGETARY EFFECTS OF H.R. 2874
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         By fiscal year, in millions of dollars--
                                ------------------------------------------------------------------------------------------------------------------------
                                   2017     2018     2019     2020     2021     2022     2023     2024     2025     2026     2027   2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                     INCREASES OR DECREASES (-) IN DIRECT SPENDING a
 
Estimated Budget Authority.....        0        *      -37      -74      -64      -46      -26       -8       10       23       36      -221       -187
Estimated Outlays..............        0        *      -37      -74      -64      -46      -26       -8       10       23       36      -221       -187
                                                     INCREASES IN SPENDING SUBJECT TO APPROPRIATION
 
Estimated Authorization Level..        0       21       14       14       13       13       13       13       13       13       13        75        140
Estimated Outlays..............        0       21       14       14       13       13       13       13       13       13       13        75        140
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes: * = between -$500,000 and zero; components may not sum to totals because of rounding.
aCBO estimates that enacting H.R. 2874 also would increase revenues by $4 million over the 2018-2027 period.

    Basis of estimate: For this estimate, CBO assumes that the 
legislation will be enacted by the end of fiscal year 2017, 
that changes in NFIP premiums will begin to go into effect for 
new and renewed policies in the spring of 2018, and that the 
authorized and necessary amounts will be appropriated for each 
fiscal year.

Background

    The NFIP was established to encourage property owners to 
purchase flood insurance if they are located in communities 
that adopt minimum guidelines for floodplain management and 
that enforce building codes designed to mitigate damage from 
floods.
    Terms for Coverage. Owners of properties that are located 
within an area designated as having at least a 1 percent chance 
of being flooded in any year (known as a Special Flood Hazard 
Area, or SFHA) and that are financed by a federally regulated 
lending institution, a government-sponsored enterprise for 
housing, or a federal lender are required to carry flood 
insurance. Property owners not receiving financing from those 
entities or located outside an SFHA may purchase flood 
insurance at their discretion. Under current law, FEMA is 
authorized to underwrite the sale and renewal of flood 
insurance policies through December 8, 2017.
    Premiums. Property owners who buy coverage through the NFIP 
pay annual premiums, which are deposited into the National 
Flood Insurance Fund (NFIF) and are used to pay flood damage 
claims submitted by policyholders. Most properties, about 80 
percent, are charged a premium based on FEMA's estimate of the 
expected cost to insure those properties against damage that 
the property will incur from flooding in an average year (known 
as actuarial premiums).
    The remaining 20 percent of properties insured by the 
program are charged premiums that are lower than the expected 
cost of flood damage (known as subsidized premiums). Throughout 
the program's history, FEMA has charged premiums that are well 
below actuarial premiums for properties that were built before 
a community's Flood Insurance Rate Map (FIRM) was completed, or 
before 1975, whichever was later. FEMA estimates that the 
owners of those properties, known as pre-FIRM properties, pay 
average premiums that are about 60 percent to 65 percent of 
what the actuarial premiums would be. Pre-FIRM properties make 
up the majority of subsidized properties. A few post-FIRM 
properties also receive discounted premiums under current law. 
Certain properties that have been newly mapped into SFHAs are 
charged lower rates for one year and some other properties 
located near structures designed to mitigate flooding (such as 
levees) that are not functional are charged rates as if the 
structure is fully effective.
    Other property owners receive cross-subsidies from other 
policyholders who are charged premiums above their expected 
cost.\1\ If cross-subsidies completely balance out, they do not 
create financial risk for taxpayers. CBO estimates that only 
those policies that are explicitly subsidized will generate 
insufficient receipts to cover the cost of expected claims and 
related expenses.
---------------------------------------------------------------------------
    \1\For details about premiums, see Congressional Budget Office, The 
National Flood Insurance Program: Factors Affecting Actuarial Soundness 
(November 2009), www.cbo.gov/publication/41313 and The National Flood 
Insurance Program: Financial Soundness and Affordability (September 
2017), www.cbo.gov/publication/53028.
---------------------------------------------------------------------------
    In 2016, premium collections from roughly 5 million 
policyholders totaled about $3.5 billion.
    Additional Collections From Policyholders. All 
policyholders also pay two additional fees: a reserve fund 
assessment equal to 15 percent of their premiums and a 
surcharge equal to $25 for policies on primary residences and 
$250 for policies on nonprimary residences or commercial 
properties. Collections from both the assessment and the 
surcharge are deposited into the NFIP Reserve Fund and are 
available to pay policyholders' claims.
    In 2016, a total of $919 million from those fees was 
deposited into the NFIP Reserve Fund.
    The NFIP's Ability to Pay Claims and Other Expenses. In 
addition to policyholders' payments of premiums and fees, the 
NFIF and the NFIP Reserve Fund are credited with annual 
appropriations from the Treasury, interest earned on fund 
balances, and amounts borrowed from the Treasury. For fiscal 
year 2017, the Congress appropriated $182 million to the NFIF. 
In addition the NFIP borrowed and spent $1.6 billion from the 
U.S. Treasury in 2017.
    The majority of the NFIP's expenses consist of payments for 
claims resulting from coverage in force. On the basis of the 
number of subsidized policies, historical experience, and the 
current level of coverage in force (about $1.2 trillion), CBO 
estimates that payments for claims in 2017 will total about 122 
percent of the program's receipts (or about $5.8 billion).\2\ 
Historically, actual expenses for claims, however, have varied 
widely by year, ranging from less than 10 percent to almost 800 
percent of the premiums collected in a calendar year.
---------------------------------------------------------------------------
    \2\CBO's baseline estimates for the NFIP were prepared in the 
spring of 2017. CBO has not yet updated those baseline estimates to 
account for the hurricanes that made landfall in August and September 
of 2017.
---------------------------------------------------------------------------
    Because of the large subsidy that exists for many policies, 
CBO estimates that annual expenses will--on average--exceed 
annual income. In most years since the program began 
operations, annual appropriations along with premiums and fees 
have been sufficient to cover the NFIP's annual expenses. 
Before 2005, the program occasionally had to borrow from the 
Treasury to meet expenses in years when losses were greater 
than average; the amounts borrowed were relatively small (less 
than $1 billion) and were repaid with interest. The 
differential grew in the aftermath of Hurricanes Katrina, Rita, 
and Wilma in 2005 and Superstorm Sandy in 2012. Largely because 
of borrowing to pay for losses in those storms, the NFIP's 
current debt to the Treasury stands at $24.6 billion.

Direct spending

    Section 109 would provide FEMA with the authority to 
continue selling and renewing policies through fiscal year 
2022. Although that authority would otherwise expire at the end 
of fiscal year 2017, CBO's baseline projections of spending 
(consistent with the rules governing baseline projections 
specified in the Balanced Budget and Emergency Deficit Control 
Act of 1985) assumes that the program continues. Thus, 
extending the NFIP's authority to continue its operations under 
current law would have no effect on direct spending relative to 
CBO's baseline estimates. Relative to that baseline, CBO 
estimates that enacting the other changes in H.R. 2874 would 
reduce net direct spending by the NFIP by $187 million over the 
2018-2027 period.
    In addition to extending the NFIP's authority to continue 
to provide insurance, H.R. 2874 would make several changes to 
the program. Six of those changes would affect direct spending 
by either adjusting the premiums paid by policyholders or 
reducing the number of NFIP policies purchased (see Table 2).

                                             TABLE 2.--ESTIMATED CHANGES IN DIRECT SPENDING UNDER H.R. 2874
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             By fiscal year, in millions of dollars--
                                         ---------------------------------------------------------------------------------------------------------------
                                            2018     2019     2020     2021     2022     2023     2024     2025     2026     2027   2018-2022  2018-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      INCREASES OR DECREASES (-) IN DIRECT SPENDING
 
Premium Increases for Pre-FIRM
 Properties:
    Estimated Budget Authority..........        0      -11      -25      -43      -61      -84     -111     -142     -179     -221      -140       -877
    Estimated Outlays...................        0      -11      -25      -43      -61      -84     -111     -142     -179     -221      -140       -877
Surcharge Adjustments:
    Estimated Budget Authority..........        *      -21      -43      -43      -42      -41      -41      -40      -40      -40      -148       -350
    Estimated Outlays...................        *      -21      -43      -43      -42      -41      -41      -40      -40      -40      -148       -350
Premiums for Subsidized Properties with
 Multiple Losses:
    Estimated Budget Authority..........        0        *        *        *       -1       -1       -1       -2       -2       -2        -2        -10
    Estimated Outlays...................        0        *        *        *       -1       -1       -1       -2       -2       -2        -2        -10
Reducing Payments to WYO Companies:
    Estimated Budget Authority..........        0       -5      -11      -15      -14      -13      -12      -11      -10       -8       -43        -97
    Estimated Outlays...................        0       -5      -11      -15      -14      -13      -12      -11      -10       -8       -43        -97
Eliminating WYO Companies' Noncompete
 Agreement and Making NFIP Data
 Available to the Public:
    Estimated Budget Authority..........        0        1        5       12       21       35       50       69       88      112        39        393
    Estimated Outlays...................        0        1        5       12       21       35       50       69       88      112        39        393
Barring Owners of Certain Properties
 From Buying NFIP Coverage:
    Estimated Budget Authority..........        0        0        0       24       50       78      107      136      165      195        74        754
    Estimated Outlays...................        0        0        0       24       50       78      107      136      165      195        74        754
    Total Changes:
        Estimated Budget Authority......        0      -37      -74      -64      -46      -26       -8       10       23       36      -221       -187
        Estimated Outlays...............        0      -37      -74      -64      -46      -26       -8       10       23       36      -221       -187
--------------------------------------------------------------------------------------------------------------------------------------------------------
Notes: FIRM = Flood Insurance Rate Map; WYO = Write Your Own; NFIP = National Flood Insurance Program.
* = between -$500,000 and zero; components may not sum to totals because of rounding.

    Some changes would effectively increase the premiums that 
policyholders pay and thus reduce direct spending. 
Specifically, those changes would:
           Increase premiums for some pre-FIRM 
        policyholders;
           Adjust the NFIP's surcharge;
           Adjust premiums for subsidized properties 
        that suffer multiple flood losses; and
           Reduce the maximum amount paid to insurers 
        in FEMA's Write Your Own (WYO) program. (Under the 
        program, private insurance companies sell and service 
        NFIP policies.)
    Other changes would reduce the number of NFIP policies 
purchased by property owners and would increase direct 
spending. Specifically, those changes would:
           Bar owners of certain properties from buying 
        insurance through the NFIP;
           Require FEMA to make certain NFIP data 
        publicly available; and
           Eliminate the noncompete requirement for 
        private insurers currently participating in the NFIP's 
        WYO program.
    The remaining changes in the bill would affect the amount 
of premiums collected and the amount of flood insurance 
coverage purchased, but would have no net effect on direct 
spending. Specifically, those changes would:
           Create a flood insurance affordability 
        program;
           Create an option for certain policyholders 
        to pay annual premiums in monthly installments; and
           Eliminate certain cross-subsidies among 
        policyholders in the program.
    Changes Affecting NFIP Premiums. CBO estimates that the 
four provisions that would affect the premiums charged to NFIP 
policyholders would reduce net direct spending by about $1.3 
billion over the 2018-2027 period. The estimate for each of 
those policies is based on enacting all of the policies 
proposed in H.R. 2874 as a comprehensive package.
    Premium Increases for Pre-FIRM Properties. Section 101 
would require FEMA to increase NFIP premiums for pre-FIRM 
properties that are primary residences by at least 8 percent 
each year until the rates are equal to what an actuarial 
premium would be. Under current law, those premiums are 
required to increase by at least 5 percent a year until they 
reach that level. In 2017, policyholders with single-family 
homes as their primary residence saw premium increases of about 
5 percent, and policyholders with multifamily structures as 
their primary residence saw increases of about 8 percent. 
Therefore, CBO anticipates that under the bill, single-family 
primary residences would have higher annual premium increases 
than under current law.
    Based on housing data and current policy information 
obtained from FEMA, CBO estimates that under the bill, about 
330,000 policies would initially be subject to those premium 
increases. Those policyholders currently pay an average premium 
of about $1,800 per year. Under the bill, once subsidies are 
completely phased out, annual premiums for those policies would 
be, on average, about 1.5 times greater than those under 
current law, CBO estimates. Although some policyholders 
probably would reduce or eliminate coverage because of the 
increases, any resulting decrease in premium receipts would, in 
CBO's estimation, be more than offset by the increased premiums 
from properties that remained in the program. Therefore, CBO 
estimates that this provision would, on net, increase NFIP 
collections (premiums and fees) by $877 million over the 2018-
2027 period.
    Surcharge Adjustments. Under H.R. 2874, surcharges for NFIP 
policies would increase from $25 to $40 for primary residences; 
for commercial properties the surcharge could increase or 
decrease depending on whether the property is eligible for what 
FEMA terms a preferred risk policy. Eligible properties would 
be those that are not in an SFHA and that have had fewer than 
three NFIP claims in the preceding 10-year period. Under the 
bill, nonprimary residences that are eligible for a preferred 
risk policy would have surcharges lowered to $125, and such 
residences that are not eligible would have surcharges raised 
to $275.
    Those changes would affect all NFIP policies, which CBO 
estimates will total about 5.1 million in 2018. On the basis of 
the types and numbers of residences in each category, CBO 
estimates that about 93 percent of policies would face 
increased surcharges and that those increases would lead to 
additional net collections of $350 million over the 2018-2027 
period.
    Premiums for Subsidized Properties with Multiple Losses. 
Section 504 would create a new category for NFIP-insured 
properties that have received claims payments for losses from 
two or more flood events, termed multiple-loss properties.
    The bill would require that premiums for any multiple-loss 
property that is also a pre-FIRM property be increased by at 
least 15 percent each year until the premiums equal the 
actuarial premium or until a flood loss generates a claim 
payment, at which point the property owner would be charged the 
actuarial premium. Considering the schedule for phasing out 
subsidies under current law, CBO estimates that increasing 
premiums for subsidized properties with multiple losses would, 
on net, increase NFIP collections by $10 million over the 2018-
2027 period.
    Reducing Payments to WYO Companies. Under current law, 
private insurance companies partner with FEMA through the 
NFIP's WYO program to sell and service policies in return for a 
per-policy commission that is used to pay the companies' 
insurance agents and cover administrative costs. In 2017, the 
base amount paid to WYO companies was 30.9 percent of the 
premiums charged to NFIP policyholders. That amount is built 
into the premiums charged to NFIP policyholders, such that 
property owners with actuarial policies are charged premiums 
sufficient to cover the expected cost of any claims plus the 
amount needed to pay the WYO companies for writing and 
servicing policies. CBO estimates that, under current law, 
total payments to WYO companies in 2017 will be about $1.2 
billion.
    H.R. 2874 would reduce payments to WYO companies from 30.9 
percent to 27.9 percent of the premiums charged to NFIP 
policyholders. CBO expects that policyholders currently paying 
actuarial rates would see their premiums slightly reduced. That 
reduction in the cost of insurance would lead to a small 
increase in purchases of flood insurance and to existing 
policyholders retaining their policies longer. That boost in 
the number of actuarial policies would increase collections 
from reserve fund assessments and surcharges, which would 
generate income above the amount expected to be required for 
the NFIP to pay claims for the policies.
    Furthermore, under the bill, pre-FIRM policyholders being 
charged subsidized rates would not see a change in their 
premiums because of this policy. For those policyholders, the 
decrease in payments to WYO companies would be retained by the 
NFIF and effectively reduce the government's costs for the 
policies.
    On the basis of information from FEMA and some WYO 
companies, CBO expects that, under H.R. 2874, some of the 
smaller WYO companies would choose to leave the program because 
of the reduction in payments but that most would remain. 
Policies written and serviced by companies that left the 
program would be transferred to either other WYO companies or 
to the NFIP's direct program, which FEMA operates through 
contractors that write and service policies. According to FEMA, 
a secondary effect of companies' departure from the WYO program 
would be the lost marketing opportunities they provide, which 
could slow purchases of NFIP policies.
    Accounting for those varying effects--the reduction in 
payments to WYO companies, and the corresponding slight 
increase in purchases and retention of actuarial policies; the 
lower subsidy for pre-FIRM policies; and slowed purchases of 
policies--CBO estimates that this provision would reduce 
spending by $97 million over the 2018-2027.
    Changes That Would Reduce the Number of NFIP Policies 
Purchased. According to CBO's estimates, provisions of H.R. 
2874 that would affect the number of policies purchased through 
the NFIP would reduce the number in force by about 5.2 million 
over the 2018-2027 period.\3\ Fewer than 1 percent (or about 
40,000) of those policies would be subsidized. The decline in 
subsidized policies would contribute to the actuarial soundness 
of the fund because those policies have expected costs that are 
greater than the premiums paid. However, the decline in all 
policies also would eliminate the associated reserve fund 
assessments and surcharges. Under current law, the average 
reserve fund assessment is about $140 per policy, and 
surcharges are $25 for primary residence policies and $250 for 
commercial or nonprimary residence policies. On balance, CBO 
estimates, the provisions that would reduce the number of NFIP 
policies purchased, by reducing the amount of funds collected 
in reserve fund assessments and surcharges, would increase the 
program's borrowing to pay claims, a form of direct spending, 
by about $1.2 billion over the 2018-2027 period.
---------------------------------------------------------------------------
    \3\Polices are purchased through the NFIP on an annual basis. In 
this estimate, CBO refers to the number of policies purchased as one 
policy for each year of coverage. Thus, the number of policies 
purchased over a 10 year span is a different measure from the number of 
properties covered by the NFIP in any particular year.
---------------------------------------------------------------------------
    Eliminating WYO Companies' Noncompete Agreement and Making 
NFIP Data Available to the Public. Sections 201 and 202 would 
eliminate the ``noncompete agreement'' that WYO companies must 
adhere to and would require FEMA to make available to the 
public the information it uses to assess the flood risk to 
properties. Under current law, insurance companies 
participating in the WYO program cannot simultaneously sell 
private flood insurance. Eliminating that restriction would 
allow WYO companies to use their access to the NFIP's data on 
premiums for policies on particular properties to set their own 
rates for those properties and compete with the NFIP. In 
addition, allowing public access to the NFIP's data would allow 
other private insurance companies to make use of the 
information to develop their rates and perhaps offer more 
competitive plans.
    On the basis of information from private insurance 
providers that have expressed interest in entering the flood 
insurance market, CBO expects that those provisions would 
increase the growth of the private flood insurance market. In 
the agency's estimation, private insurers would compete with 
the NFIP for properties eligible for preferred risk policies 
and other properties located outside of SFHAs, and they would 
probably show interest in some properties located in SFHAs as 
well. Under the bill, CBO estimates that holders of about 
690,000 policies that would have been purchased through the 
NFIP under current law over the 2018-2027 period would instead 
choose to buy private flood insurance. No property owners who 
are subsidized by the NFIP would be expected to be among those 
leaving the program.
    Barring Owners of Certain Properties From Buying NFIP 
Coverage. Sections 505 and 506 would bar certain property 
owners from purchasing NFIP insurance. Section 505 would deny 
coverage for any structure for which lifetime losses (beginning 
after the law's enactment) are more than two times its 
replacement value. On the basis of an analysis of information 
from FEMA about the likelihood of such losses, CBO estimates 
that this provision would not significantly reduce the number 
of NFIP policies over the 2018-2027 period.
    Section 506 would bar owners of certain newly constructed 
properties from the NFIP if FEMA can certify that private flood 
insurance is available to them. Beginning in 2021, that 
restriction would apply to properties located in an SFHA as 
well as single-family and multifamily properties with a 
replacement value of greater than $1 million per dwelling 
within the structure, adjusted for inflation every five years. 
If private insurance options could not be verified, property 
owners could purchase insurance through the NFIP, but premiums 
would be subject to a 10 percent surcharge. On average, that 
surcharge would be about $60 in 2021, CBO estimates. Using a 
database of current NFIP policies and housing information from 
Fannie Mae and Freddie Mac and adjusting for anticipated 
inflation, CBO estimates that section 506 could affect about 
240,000 properties in 2021 that otherwise would have NFIP 
coverage under current law. The majority (or about 65 percent) 
of those properties would be newly constructed buildings in 
SFHAs.
    According to multiple insurance companies that have 
expressed interest in entering the private flood insurance 
market, companies are most interested in selling flood 
insurance policies to owners of properties that are outside of 
SFHAs. Although the companies indicate that they may be 
interested in providing flood insurance for newly constructed 
properties in SFHAs, CBO expects that the risk of damage from 
flooding for many locations is too great for such companies to 
offer such private insurance over the 2021-2027 period. On 
balance, CBO estimates that approximately 60,000 (or 25 
percent) of all the properties that would be affected by this 
provision would lack a private flood insurance provider and the 
owners would continue to purchase their insurance through the 
NFIP.
    CBO estimates that the remaining 180,000 properties that 
would be affected by section 506 and barred from the NFIP 
starting in 2021 would either purchase flood insurance through 
a private provider or would forgo coverage. Over the 2021-2027 
period, this provision would eliminate about 4.5 million NFIP 
polices that would otherwise exist under current law.
    Other Provisions. CBO expects that three other provisions 
of H.R. 2874 would affect the amount of NFIP coverage purchased 
and the amount of premiums collected but would not affect net 
direct spending.
    Flood Insurance Affordability Program. Section 102 would 
direct FEMA to implement a state-run affordability program. The 
program would allow a state to identify households 
participating in the NFIP that are below certain income 
thresholds and submit a list of those households to FEMA. The 
agency would then either cap the premiums charged to those 
households or limit their annual premium increases. FEMA would 
then place a surcharge on all other NFIP policies in the state 
to recoup the funding lost through any subsidies. Because FEMA 
would have the authority to set the surcharge at any amount, 
which CBO expects would be relatively small, CBO estimates that 
enacting this section would have no significant effect on the 
total NFIP collections from each state.
    Monthly Installment of Premiums. Under current law, FEMA 
must provide certain NFIP policyholders (those who are not 
required to pay their premiums and fees for flood insurance 
through an escrow account) the option to pay premiums on either 
an annual or monthly basis. Because regulations implementing 
this requirement have not been issued, all such NFIP 
policyholders currently pay premiums annually.
    Section 105 would direct FEMA to allow the policyholders 
eligible to pay premiums in monthly installments to do so 
before implementing regulations exist. Under current law, the 
possibility of paying monthly payments exists for only a small 
number of policies because most properties are subject to 
mortgages with a lending institution that requires insurance 
payments to be paid through escrow accounts. Enacting H.R. 2874 
would not change that situation.
    The bill would allow FEMA to charge a fee of up to $50 for 
each policy each year for policyholders who opt to pay their 
premiums on a monthly basis. The fee would be used to offset 
any administrative costs associated with collecting, storing, 
and processing payments at that interval. Because few 
policyholders are eligible to pay premiums in monthly 
installments, CBO estimates this provision would have no 
significant effect on net direct spending.
    Certain Cross-Subsidies. Section 506 would require that 
certain NFIP cross-subsidies be phased out. Those cross-
subsidies allow some properties to be charged premiums that are 
treated as if they were actuarial but are actually lower than 
actuarial rates. Because eliminating those cross-subsidies 
would simultaneously lower premiums for policies that are 
currently charged higher than actuarial rates and raise 
premiums for policies that are currently charged lower than 
actuarial rates, CBO estimates that phasing out those subsidies 
would have no significant effect on net direct spending.

Revenues

    Section 508 would increase, from $2,000 to $5,000 per 
violation, the civil penalty charged to lending institutions 
for not enforcing the NFIP's mandatory purchase requirement. 
Based on an analysis of information provided by FEMA about the 
number of penalties imposed, CBO estimates that enacting H.R. 
2874 would increase those penalties by $4 million over the 
2018-2027 period. Those penalties would be recorded in the 
budget as revenues and would be available to be spent by the 
NFIP without further appropriation.

Spending subject to appropriation

    CBO estimates that, over the 2018-2022 period, implementing 
H.R. 2874 would cost $75 million for administrative costs to 
operate the NFIP, assuming appropriation of the necessary 
amounts.
    Flood Mitigation Assistance. The bill would authorize the 
appropriation of $225 million for each fiscal year for FEMA to 
provide flood mitigation grants to NFIP policyholders. Under 
the bill, all such spending would be subject to additional fees 
charged to NFIP policyholders. Consequently, CBO estimates 
that, subject to appropriation of the authorized amounts, all 
spending from this provision would be offset by collections 
from NFIP policyholders.
    Other Changes in Discretionary Spending. H.R. 2874 would 
make a number of other changes that would affect discretionary 
spending, including updating the flood map appeals process, 
implementing an independent actuarial review process, having 
FEMA establish and run a flood insurance clearinghouse, and 
implementing a pilot program for community-based flood 
insurance. In addition, administrative costs for the NFIP 
affordability program would be paid with annual appropriations. 
Based on an analysis of information provided by FEMA, CBO 
estimates implementing those provisions would cost $75 million 
over the 2018-2022 period.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays and revenues that would be 
subject to those procedures under H.R. 2874 are shown in Table 
3.

     TABLE 3.--CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 2874 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON FINANCIAL SERVICES ON MAY 17, 2011
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                         By fiscal year, in millions of dollars--
                                ------------------------------------------------------------------------------------------------------------------------
                                   2017     2018     2019     2020     2021     2022     2023     2024     2025     2026     2027   2017-2022  2017-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact.        0        0      -37      -74      -64      -46      -26       -8       10       23       36      -223       -191
Memorandum:
    Changes in Outlays.........        0        0      -37      -74      -64      -46      -26       -8       10       23       36      -221       -187
    Changes in Revenues........        0        0        0        0        0        0        0        0        0        0        0         2          4
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Increase in long-term direct spending and deficits: CBO 
estimates that enacting H.R. 2874 would not increase net direct 
spending or on-budget deficits by more than $5 billion in any 
of the four consecutive 10-year periods beginning in 2028.
    Intergovernmental and private-sector impact: H.R. 2874 
contains no intergovernmental or private-sector mandates as 
defined in UMRA.
    Estimate prepared by: Federal costs: Robert Reese; Impact 
on state, local, and tribal governments: Rachel Austin; Impact 
on the private sector: Logan Smith.
    Estimate approved by: H. Samuel Papenfuss, Deputy Assistant 
Director for Budget Analysis.

                       Federal Mandates Statement

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act.

                      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 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 the section 
102(b)(3) of the Congressional Accountability Act.

                         Earmark Identification

    H.R. 2874 does not contain any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                    Duplication of Federal Programs

    Pursuant to section 3(c)(5) of rule XIII, the Committee 
states that no provision of H.R. 2874 establishes or 
reauthorizes a program of the Federal Government known to be 
duplicative of another Federal program, a program that was 
included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most 
recent Catalog of Federal Domestic Assistance.

                   Disclosure of Directed Rulemaking

    Pursuant to section 3(i) of H. Res. 5, 115th Cong. (2017), 
the Committee states that H.R. 2874 contains no directed 
rulemaking.

             Section-by-Section Analysis of the Legislation


            TITLE I--POLICYHOLDER PROTECTION AND INFORMATION

Sec. 101. Annual limitation on premium increase

    Decreases the cap on annual rate increases from 18 to 15 
percent; and increases the minimum average chargeable risk 
premium, within a single risk classification, from 5 percent to 
8 percent.

Sec. 102. Flood insurance affordability program

    Authorizes states to voluntarily create state flood 
insurance affordability programs that identify and validate 
eligible owner-occupants of single family 1-4 unit residences 
who are unable to pay their chargeable risk premium due to 
family income. Eligibility, validated using existing Federal 
income eligibility programs as a guideline, is limited to 
policyholders with incomes below the threshold of the greater 
of 150 percent of the state poverty level or 60 percent of the 
state area median income. At a date certain, as defined by 
FEMA, the state would forward its validated list to FEMA 
consisting of all eligible policyholders for whom the state is 
seeking assistance, along with the recommended type of 
assistance for each policy. Assistance can be in the form of 
either (1) capping the amount of chargeable risk premium paid, 
or (2) limiting the amount of premium increase on an annualized 
basis. FEMA would calculate the value of the aggregate subsidy 
cost for eligible policyholders within the state, the cost of 
which would be recouped through an equally distributed 
surcharge on all other policyholders within that state.

Sec. 103. Disclosure of premium methodology

    Requires the FEMA Administrator to develop a transparent 
public process to explain and engage with the public on its 
methodology to determine annual risk premium rates for NFIP 
coverage, six months prior to the effective date of risk 
premium rates. Annual public forums in each of FEMA's Federal 
regions are required.

Sec. 104. Consideration of coastal and inland locations in premium 
        rates

    Requires the FEMA Administrator, when calculating annual 
chargeable premium rates, to consider the differences in 
properties located in local coastal and inland areas.

Sec. 105. Monthly installment payment of premiums

    Authorizes the FEMA Administrator to adopt policies and 
procedures to finalize implementation of the monthly 
installment payment of premiums provision, initially required 
by the Homeowner Flood Insurance Affordability Act of 2014.

Sec. 106. Enhanced clear communication of flood risks

    Requires the FEMA Administrator to clearly communicate to 
all policyholders their full flood risks of their property, the 
number and dollar value of claims that have been filed over the 
life of a property, and the effect that filing any future 
claims would have on the cost of insurance for that property.

Sec. 107. Availability of flood insurance information upon request

    Requires the FEMA Administrator to make available, upon 
request of a policyholder, specific data and information 
related to the policyholder's property or structure, which 
includes any historical information, claims payments, flood 
damages, and whether the property may be required to purchase 
flood insurance due to previous receipt of federal disaster 
assistance.

Sec. 108. Disclosure of flood risk information upon transfer of 
        property

    No new NFIP coverage may be provided for any property 
unless the appropriate government unit requires, by September 
30, 2022, either through statutory action or regulation, that 
the seller or lessor of such property discloses in writing any 
actual knowledge to a buyer or lessee of (1) prior flood damage 
to any building located on the property; (2) prior insurance 
claims for losses covered under the NFIP or private flood 
insurance; (3) any previous notification regarding the 
designation of the property as a repetitive loss or severe 
repetitive loss property and (4) any Federal legal obligation 
to obtain and maintain flood insurance.

Sec. 109. Voluntary community-based flood insurance program

    The Administrator may carry out a community-based flood 
insurance pilot program to make available, for purchase by 
participating communities, a single, community-wide flood 
insurance policy under the NFIP that (1) covers all residential 
and non-residential properties within the community and (2) 
satisfies, for all properties within the community, the NFIP 
mandatory purchase requirement. Participation by a community in 
the pilot program shall be entirely voluntary on the part of 
the community. The Administrator shall ensure that a community-
wide flood insurance policy under the pilot program 
incorporates: (1) a mapping requirement for properties covered 
by the policy; (2) a cap on premiums; (3) a deductible; (4) 
certification or accreditation of mitigation infrastructure 
when available and appropriate, (5) a community audit; (6) the 
Community Rating System; (7) a method of preventing redundant 
claims payments by the NFIP in the case of a policyholder who 
is covered by a community-wide policy and an individual policy 
obtained through the NFIP; (8) coverage for damage arising from 
flooding that complies with NFIP standards. The Administrator 
may establish the demonstration program under this section not 
later than 180 days after bill enactment and the demonstration 
program shall terminate on September 30, 2022.

Sec. 110. Extension of the national flood insurance program

    Extends the National Flood Insurance Program through 
September 30, 2022.

TITLE II--INCREASING CONSUMER CHOICE THROUGH PRIVATE MARKET DEVELOPMENT

Sec. 201. Elimination of non-compete requirement

    Eliminates the regulatory restriction that currently 
prevents insurers participating in the NFIP's Write Your Own 
(WYO) Program from selling both NFIP and private flood 
insurance policies.

Sec. 202. Public availability of program information

    Requires FEMA to develop an open-source data system to 
allow public access of all information related to assessing 
flood risk or identifying and establishing flood elevations and 
premiums, including, where available, data relating to risk on 
individual properties and loss ratio information and other 
information identifying losses under the program. Personally 
identifiable information shall not be made available; the 
information provided shall be based on data that identifies 
properties at the zip code or census block level, and shall 
include the name of the community and state in which the 
property is located.

Sec. 203. Refund of premiums upon cancellation of policy because of 
        replacement with private flood insurance

    Requires FEMA to allow policyholders who cancel their NFIP 
policies during the middle of the policy term to receive a pro-
rata refund on their premiums if the policy is replaced with 
private flood insurance. Excludes properties that have received 
any taxpayer-funded mitigation assistance through the NFIP's 
Increased Cost of Compliance program or if a claim has been 
paid or is pending under the policy term for which the refund 
is sought.

Sec. 204. Provision of private flood insurance by mutual aid societies

    Amends the National Flood Insurance Act of 1968 to allow 
the coverage of flood peril provided by mutual aid societies, a 
group created by common ethical or religious beliefs, to 
satisfy the flood insurance mandatory purchase requirement.

Sec. 205. GAO study of flood damage savings accounts

    Requires the Comptroller General of the United States to 
conduct a study assessing the feasibility and effectiveness of 
establishing voluntary flood damage savings accounts to reduce 
flood insurance premiums and eliminate the need for purchase of 
flood insurance coverage.

Sec. 206. Demonstration program for flood damage savings account

    Requires the FEMA Administrator to submit to Congress a 
plan for the implantation of a demonstration program to 
establish voluntary flood damage savings accounts that takes 
into consideration the analysis, conclusions, and 
recommendations developed by the Comptroller General of the 
United States.

                      TITLE III--MAPPING FAIRNESS

Sec. 301. Use of other risk assessment tools in determining premium 
        rates

    Requires the FEMA Administrator to use other risk 
assessment data and tools, including risk assessment models and 
scores from appropriate sources, in addition to applicable 
flood rate maps when determining annual chargeable premium 
rates.

Sec. 302. Appeals regarding existing flood maps

    Creates a new appeals process for States, local 
governments, or the owners or lessees of real property for whom 
FEMA has denied a request to update their FEMA-created map to 
appeal that decision based on new information regarding base 
flood elevation levels or other flood mitigating factors. The 
initial appeals process would be through an agency 
administrative process, with the possibility of a further 
appeal to the Scientific Resolution Panel. In cases where the 
appeal is wholly or partially successful, affected 
policyholders can cancel an impacted policy and are entitled to 
a refund on their premiums. Moreover, the appellant is entitled 
to recover reasonable costs for the successful appeal, not to 
include legal or contingency fees.

Sec. 303. Appeals and publication of projected special flood hazard 
        areas

    Clarifies that the owner or lessee of real estate adversely 
affected by the FEMA Administrator's determination of flood 
elevations and special hazard areas may appeal such 
determination no later than 90 days after the date of the 
second publication of a flood insurance rate map. Moreover, 
this provision clarifies that the FEMA Administrator's 
determination will become final if there are no appeals during 
the 90 day period following that second publication.

Sec. 304. Communication and outreach regarding map changes

    Gives FEMA the ability to expedite the required community 
notification layover period for communities that wish to 
accelerate their mapping approval process.

Sec. 305. Sharing and use of maps and data

    Requires the FEMA Administrator to consult and coordinate 
with the Department of Defense, the United States Geological 
Survey, and the National Oceanic and Atmospheric Administration 
to obtain the most recent maps and other data relevant to flood 
maps.

    TITLE IV--PROTECTING CONSUMERS AND INDIVIDUALS THROUGH IMPROVED 
                               MITIGATION

Sec. 401. Provision of Community Rating System premium credits to 
        maximum number of communities practicable

    Requires FEMA to provide communities that have joined its 
Community Rating System program with appropriate credits in 
calculating their annual chargeable premium rates when those 
communities implement or benefit from measures that protect 
natural and beneficial floodplain functions.

                       TITLE V--PROGRAM INTEGRITY

Sec. 501. Independent actuarial review

    Assigns the FEMA Administrator the statutory responsibility 
to ensure that the NFIP remains financially sound. Requires the 
FEMA Administrator to provide for an annual independent 
actuarial study of the NFIP to analyze the financial position 
of the program based on its long-term estimated losses. 
Requires the FEMA Administrator to transmit the results of that 
report to Congress, along with the FEMA Administrator's 
determination of whether there exists an actuarial budget 
deficit for the NFIP for the year covered in the report and any 
recommended changes to the program to ensure that the program 
remains financially sound. Additionally, require the FEMA 
Administrator to submit quarterly reports to Congress on the 
changing policyholder composition and risk profile of the NFIP.

Sec. 502. Adjustments to homeowners flood insurance affordability 
        surcharge

    Restructures the surcharge originally created by the 
Homeowner Flood Insurance Affordability Act of 2014 to: (1) 
increase annual surcharges from $25 to $40 for all primary 
residences; (2) reduce annual surcharge from $250 to $125 for 
non-owner occupied residential properties that are currently 
subject to Preferred Risk Policy premium rates; and, (3) 
increase the annual surcharge from $250 to $275 for all other 
non-primary residences.

Sec. 503. National Flood Insurance Reserve Fund compliance

    Requires the FEMA Administrator to increase the current 
National Flood Insurance Reserve Fund assessment rate by 1 
percent each year until the NFIP achieves its statutorily 
mandated reserve ratio phase-in requirement of not less than 
7.5 percent.

Sec. 504. Designation and treatment of multiple-loss properties

    Enhances and consolidates the NFIP's ability to manage and 
track properties with a history of multiple claims by defining 
a new ``multiple-loss property'' term to cover all at-risk 
properties. Multiple-loss property would encompass three types 
of properties: (1) a revised definition of repetitive-loss 
property, meaning a property with two more claims of any 
amount; (2) a revised definition of severe repetitive loss 
property, meaning a property with 4 or more separate claims 
payments at $5,000 each and the cumulative amount of such 
claims payments exceeding $20,000, or at least 2 separate 
claims payments with the cumulative amount of such claims 
payments exceeding the value of the structure; and, (3) a new 
definition of ``extreme repetitive-loss property,'' meaning a 
property that has incurred flood damage for which at least 2 
separate claims have been made with the cumulative amount of 
such claims payments exceeding 150 percent of the maximum 
coverage amount available for the structure. Any multiple-loss 
property not currently paying full risk rates shall be subject 
to a subsidy phase-out at an annual rate of 15 percent per 
year. Severe repetitive-loss and extreme repetitive loss 
properties would be subject to a minimum deductible of $5,000. 
The Administrator may provide flood insurance coverage for 
multiple-loss properties only if the owner of the property 
submits to the Administrator the data and information necessary 
to determine the property's current risk of flood. The 
Administrator may deny NFIP coverage if the owner of any 
extreme repetitive-loss property for which a claim payment for 
flood was made refuses an offer of mitigation for the property. 
The Administrator shall clearly communicate to all 
policyholders for multiple-loss properties the effect on the 
premium rates charged for the property of filing any further 
claims with respect to that property. Multiple-loss properties 
would be eligible for prioritized mitigation assistance through 
the Flood Mitigation Assistance program, with up to a 100 
percent cost share subject to the availability of funds. 
Authorizes $225 billion annually for Flood Mitigation 
Assistance grants.

Sec. 505. Elimination of coverage for properties with excessive 
        lifetime claims

    Prospectively prohibits the availability of NFIP coverage 
of any multiple-loss property with lifetime losses so excessive 
that the aggregate amount in claims payments, made after 
enactment of this Act, exceeds twice the amount of the 
replacement value of the structure.

Sec. 506. Addressing tomorrow's high-risk structures today

    Pursuant to his fiduciary duty and responsibility to ensure 
that the NFIP remain financially sound, requires the FEMA 
Administrator to no longer make available NFIP coverage for 
certain high-risk properties after January 1, 2021, that have 
other available private flood insurance options. The high-risk 
properties covered by this prohibition include any new 
structures added to today's high-risk special flood hazard 
areas, as well 1-4 unit residential structures where the 
replacement cost of the building (exclusive of the real estate 
upon which the structure is located) exceeds $1 million. 
Creates a private marketplace clearinghouse for flood insurance 
by directing the FEMA Administrator to study how the agency 
could create a clearinghouse, report to Congress on its 
findings, and then implement the development of the 
clearinghouse. The clearinghouse would allow private flood 
insurers to offer flood insurance to (1) high-valued 
structures, and (2) newly built structures that the bill makes 
ineligible for NFIP. If such properties are unable to find 
private flood coverage that is sufficient to satisfy the 
mandatory purchase requirement under the law, then NFIP 
insurance would be made available for that property, subject to 
a 10% surcharge. The Administrator must use third-party 
management to operate the clearing house as well as charge 
appropriate fees to cover the administrative costs.

Sec. 507. Pay for performance and streamlining costs and reimbursement

    The allowance paid to companies participating in the Write 
Your Own Program shall not be greater than 27.9 percent of the 
chargeable premium for such coverage. The reduction shall be 
imposed by equal reductions over the 3-year period beginning on 
the date of the bill's enactment. Within three years of the 
bill's enactment, the Administrator shall reduce the costs and 
unnecessary burdens for the companies participating in the WYO 
program by at least 1.5%. To meet the reduction, FEMA shall 
consider savings including (1) indirect payments by the 
Administrator of premium; (2) eliminating unnecessary 
communications requirements; (3) reducing the frequency of NFIP 
changes; (4) simplifying the flood rating system; and (5) other 
ways of streamlining the NFIP to reduce costs while maintaining 
customer service and distribution.

Sec. 508. Enforcement of mandatory purchase requirements

    Increases the civil money penalties on federally regulated 
lenders for failure to comply with the NFIP's mandatory 
purchase requirements from $2,000 to $5,000, and require an 
annual report from federal banking regulators and the GSEs on 
the compliance of covered lenders with existing mandatory 
purchase requirements.

Sec. 509. Satisfaction of mandatory purchase requirement in states 
        allowing all-perils policies

    Provides for the satisfaction of the NFIP's mandatory 
purchase requirement for those properties located in a state 
that adopts a state-based requirement for mandatory ``all 
perils'' coverage that includes flood insurance.

Sec. 510. Flood insurance purchase requirements

    Updates the existing exception from the NFIP's mandatory 
purchase requirement under the Flood Disaster Protection Act of 
1973 for small dollar loans with a repayment term of 1 year or 
less from an original outstanding principal balance of $5,000 
or less to an inflation adjusted $25,000 or less. Additionally, 
reiterate that nothing in the law prohibits states, localities, 
and private lenders from requiring the purchase of flood 
insurance coverage for a structure that is located outside of 
an area designated by FEMA as a special flood hazard area.

Sec. 511. Clarifications; Deadline for approval of claims

    Clarifies the definition of `knowingly' as having actual 
knowledge of or acting with deliberate ignorance of or reckless 
disregard for the prohibitions under this section. Prior to 
commencing legal action on any dispute claimed under the NFIP, 
a policyholder must exhaust all administrative remedies, 
including submission of disputed claims to appeal. In the case 
of any claim for damage to or loss of property under the NFIP, 
the Administrator shall provide that an initial determination 
regarding approval of a claim for payment or disapproval of the 
claim be made and notification of the determination be provided 
to the insured making the claim not later than 120 days 
beginning upon the day of a signed proof of loss. The 120-day 
deadline may be extended by a single additional period of 15 
days in extraordinary circumstance, as determined by the 
Administrator.

Sec. 512. GAO study of simplification of National Flood Insurance 
        Program

    The Comptroller General shall conduct a study of the 
options for simplifying flood insurance coverage under the 
NFIP. The study shall include (1) an analysis of how the 
administration of the NFIP can be simplified for private flood 
insurance policyholders, companies, agents, mortgage lenders, 
and flood insurance vendors; (2) an assessment of ways in which 
NFIP coverage may be harmonized with private insurance industry 
standards; (3) identification and analysis of ways in the which 
the structure of the NFIP may be simplified, including analysis 
of the effect of eliminating the use of two deductibles under 
the NFIP, including in claims for flood-damages full 
replacement cost for property not damaged but rendered unusable 
by the flooding, and using umbrella policies that allow 
multiple structures on a property to be insured under the same 
policy. The GAO shall submit the report to Congress not later 
than 18 months after the date of enactment.

         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, and existing law in which no 
change is proposed is shown in roman):

                  NATIONAL FLOOD INSURANCE ACT OF 1968




           *       *       *       *       *       *       *
TITLE XIII--NATIONAL FLOOD INSURANCE

           *       *       *       *       *       *       *



            CHAPTER I--THE NATIONAL FLOOD INSURANCE PROGRAM


                            basic authority

  Sec. 1304. (a) To carry out the purposes of this title, the 
Administrator of the Federal Emergency Management Agency is 
authorized to establish and carry out a national flood 
insurance program which will enable interested persons to 
purchase insurance against loss resulting from physical damage 
to or loss of real property or personal property related 
thereto arising from any flood occurring in the United States.
  (b) Additional Coverage for Compliance With Land Use and 
Control Measures.--The national flood insurance program 
established pursuant to subsection (a) shall enable the 
purchase of insurance to cover the cost of implementing 
measures that are consistent with land use and control measures 
established by the community under section 1361 for--
          (1) properties that are [repetitive loss structures] 
        multiple-loss properties ;
          (2) properties that are substantially damaged 
        structures;
          (3) properties that have sustained flood damage on 
        multiple occasions, if the Administrator determines 
        that it is cost-effective and in the best interests of 
        the National Flood Insurance Fund to require compliance 
        with the land use and control measures.
          (4) properties for which an offer of mitigation 
        assistance is made under--
                  (A) section 1366 (Flood Mitigation Assistance 
                Program);
                  (B) the Hazard Mitigation Grant Program 
                authorized under section 404 of the Robert T. 
                Stafford Disaster Assistance and Emergency 
                Relief Act (42 U.S.C. 5170c);
                  (C) the Predisaster Hazard Mitigation Program 
                under section 203 of the Robert T. Stafford 
                Disaster Assistance and Emergency Relief Act 
                (42 U.S.C. 5133); and
                  (D) any programs authorized or for which 
                funds are appropriated to address any unmet 
                needs or for which supplemental funds are made 
                available.
The Administrator shall impose a surcharge on each insured of 
not more than $75 per policy to provide cost of compliance 
coverage in accordance with the provisions of this subsection.
  (c) In carrying out the flood insurance program the 
Administrator shall, to the maxmium extent practicable, 
encourage and arrange for--
          (1) appropriate financial participation and risk 
        sharing in the program by insurance companies and other 
        insurers, and
          (2) other appropriate participation on other than a 
        risk-sharing basis, by insurance companies and other 
        insurers, insurance agents and brokers, and insurance 
        adjustment organizations, in accordance with the 
        provisions of chapter II.

SEC. 1304A. AVAILABILITY OF INSURANCE FOR MULTIPLE-LOSS PROPERTIES.

  (a) Date and Information Identifying Current Flood Risk.--The 
Administrator may provide flood insurance coverage under this 
title for a multiple-loss property only if the owner of the 
property submits to the Administrator such data and information 
necessary to determine such property's current risk of flood, 
as determined by the Administrator, at the time of application 
for or renewal of such coverage.
  (b) Refusal to Mitigate.--
          (1) In general.--Except as provided pursuant to 
        paragraph (2), the Administrator may not make flood 
        insurance coverage available under this title for any 
        extreme repetitive-loss property for which a claim 
        payment for flood loss was made under coverage made 
        available under this title that occurred after the date 
        of enactment of the 21st Century Flood Reform Act if 
        the property owner refuses an offer of mitigation for 
        the property under section 1366(a)(2) (42 U.S.C. 
        4104c(a)(2)).
          (2) Exceptions; appeals.--The Director shall develop 
        guidance to provide appropriate exceptions to the 
        prohibition under paragraph (1) and to allow for 
        appeals to such prohibition.

                    scope of program and priorities

  Sec. 1305. (a) In carrying out the flood insurance program 
the Administrator shall afford a priority to making flood 
insurance available to cover residential properties which are 
designed for the occupancy of from one to four families, church 
properties, and business properties which are owned or leased 
and operated by small business concerns.
  (b) If on the basis of--
          (1) studies and investigations undertaken and carried 
        out and information received or exchanged under section 
        1307, and
          (2) such other information as may be necessary,
the Administrator determines that it would be feasible to 
extend the flood insurance program to cover other properties, 
he may take such action under this title as from time to time 
may be necessary in order to make flood insurance available to 
cover, on such basis as may be feasible, any types and classes 
of--
          
          (A) other residential properties not described in 
        subsection (a) or (d),
          (B) other business properties,
          (C) agricultural properties,
          (D) properties occupied by private nonprofit 
        organizations, and
          (E) properties owned by State and local governments 
        and agencies thereof,
and any such extensions of the program to any types and classes 
of these properties shall from time to time be prescribed in 
regulations.
  (c) The Administrator shall make flood insurance available in 
only those States or areas (or subdivisions thereof) which he 
has determined have--
          (1) evidenced a positive interest in securing flood 
        insurance coverage under the flood insurance program, 
        [and]
          (2) given satisfactory assurance that by December 31, 
        1971, adequate land use and control measures will have 
        been adopted for the State or area (or subdivision) 
        which are consistent with the comprehensive critiera 
        for land management and use developed under section 
        1361, and that the application and enforcement of such 
        measures will commence as soon as technical information 
        on floodways and on controlling flood elevations is 
        available[.]; and
          (3) given satisfactory assurance that by September 
        31, 2022, property flood hazard disclosure requirements 
        will have been adopted for the area that meet the 
        requirements of section 1326.
  (d) Availability of Insurance for Multifamily Properties.--
          (1) In general.--The Administrator shall make flood 
        insurance available to cover residential properties of 
        5 or more residences. Notwithstanding any other 
        provision of law, the maximum coverage amount that the 
        Administrator may make available under this subsection 
        to such residential properties shall be equal to the 
        coverage amount made available to commercial 
        properties.
          (2) Rule of construction.--Nothing in this subsection 
        shall be construed to limit the ability of individuals 
        residing in residential properties of 5 or more 
        residences to obtain insurance for the contents and 
        personal articles located in such residences.
  (e) Prohibition of Coverage for Properties With Excessive 
Lifetime Claims.--After the expiration of the 18-month period 
beginning on the date of the enactment of this subsection, the 
Administrator may not make available any new or renewed 
coverage for flood insurance under this title for any multiple-
loss property for which the aggregate amount in claims payments 
that have been made after the expiration of such period under 
flood insurance coverage under this title exceeds twice the 
amount of the replacement value of the structure.
  (f) Reducing Future Risks of the National Flood Insurance 
Fund.--
          (1) Prohibition of new coverage for high-risk 
        properties.--Except as provided in subsection (g) and 
        notwithstanding any other provision of this title, in 
        carrying out the fiduciary responsibility to the 
        National Flood Insurance Program under section 1309(e) 
        (42 U.S.C. 4016(e)) and to reduce future risks to the 
        National Flood Insurance Fund, on or after January 1, 
        2021, the Administrator may not make available flood 
        insurance coverage under this title as follows:
                  (A) New structures added to flood hazard 
                zones.--Any new coverage for any property for 
                which new construction is commenced on or after 
                such date and that, upon completion of such 
                construction, is located in an area having 
                special flood hazards.
                  (B) Structures with high-value replacement 
                costs.--Any new or renewed coverage for any 
                residential property having 4 or fewer 
                residences and a replacement value of the 
                structure, at the time, exclusive of the value 
                of the real estate on which the structure is 
                located, that is equal to or exceeds the amount 
                that is equal to $1,000,000 multiplied by the 
                number of dwelling units in the structure (as 
                such amount is adjusted pursuant to clause 
                (i)), subject to the following provisions:
                          (i) Adjustment of amounts.--The 
                        dollar amount in the matter of this 
                        subparagraph that precedes this clause 
                        (as it may have been previously 
                        adjusted) shall be adjusted for 
                        inflation by the Administrator upon the 
                        expiration of the 5-year period 
                        beginning upon the enactment of this 
                        subsection and upon the expiration of 
                        each successive 5-year period 
                        thereafter, in accordance with an 
                        inflationary index selected by the 
                        Administrator.
                          (ii) Valuation.--The Administrator 
                        shall determine the replacement value 
                        of a property for purposes of this 
                        subparagraph using such valuation 
                        methods or indicia as the Administrator 
                        determines are reasonably accurate, 
                        consistent, reliable, and available for 
                        such purposes.
          (2) Actuarial structures with hidden risks.--For any 
        property with risk premium rates estimated under 
        section 1307(a)(1), on or after January 1, 2021, the 
        Administrator shall charge risk premium rates based on 
        the current risk of flood reflected in the flood 
        insurance rate map or comparable risk rating metric in 
        effect at the time a policy is newly issued, unless the 
        newly issued policy covers a property with continuous 
        flood insurance coverage under this title, or upon the 
        renewal of a policy. For all such policy renewals, the 
        Administrator shall increase the risk premium rate in 
        accordance with section 1308(e)(2) until the risk 
        premium rate is equal to the risk of flood reflected in 
        the flood insurance rate map or comparable risk rating 
        metric in effect at the time of renewal.
          (3) Implementation.--The Administrator may implement 
        this subsection without rulemaking, except that any 
        such implementation shall include advance publication 
        of notice in the Federal Register or advance notice by 
        another comparable method, such as posting on an 
        official website of the Administrator.
  (g) Availability of Otherwise Prohibited Flood Insurance 
Coverage Where Private Market Coverage Is Unavailable.--
          (1) In general.--The Administrator may make available 
        flood insurance coverage under this Act for a property 
        described in subparagraph (A) or (B) of subsection 
        (f)(1), notwithstanding subsection (f) of this section, 
        if, within the 30-day period beginning upon submission 
        to the Clearinghouse established pursuant to section 
        1350 of an application for flood insurance coverage for 
        such property, the Clearinghouse does not provide the 
        applicant with one or more bona fide offers for private 
        flood insurance coverage for such property.
          (2) Surcharge.--Any flood insurance coverage made 
        available for a property pursuant to this subsection 
        shall be made available at chargeable premium rates 
        otherwise determined under this title for such 
        property, except that the Administrator shall impose 
        and collect a surcharge for such coverage in an amount 
        equal to 10 percent of such chargeable premium rate, 
        which shall be deposited into the National Flood 
        Insurance Fund established under section 1310.

              nature and limitation of insurance coverage

  Sec. 1306. (a) The Administrator shall from time to time, 
after consultation with the advisory committee authorized under 
section 1318, appropriate representatives of the pool formed or 
otherwise created under section 1331, and appropriate 
representatives of the insurance authorities of the respective 
States, provide by regulation for general terms and conditions 
of insurability which shall be applicable to properties 
eligible for flood insurance coverage under section 1305, 
including--
          (1) the types, classes, and locations of any such 
        properties which shall be eligible for flood insurance, 
        subject to subsections (f) and (g) of section 1305 ;
          (2) the nature and limits of loss or damage in any 
        areas (or subdivisions thereof) which may be covered by 
        such insurance;
          (3) the classification, limitation, and rejection of 
        any risks which may be advisable;
          (4) appropriate minimum premiums;
          (5) appropriate loss-deductibles; and
          (6) any other terms and conditions relating to 
        insurance coverage or exclusion which may be necessary 
        to carry out the purposes of this title.
  (b) In addition to any other terms and conditions under 
subsection (a), such regulations shall provide that--
          (1) any flood insurance coverage based on chargeable 
        premium rates under section 1308 which are less than 
        the estimated premium rates under section 1307(a)(1) 
        shall not exceed--
                  (A) in the case of residential properties--
                          (i) $35,000 aggregate liability for 
                        any single-family dwelling, and 
                        $100,000 for any residential structure 
                        containing more than one dwelling unit,
                          (ii) $10,000 aggregate liability per 
                        dwelling unit for any contents related 
                        to such unit, and
                          (iii) in the States of Alaska and 
                        Hawaii, and in the Virgin Islands and 
                        Guam, the limits provided in clause (i) 
                        of this sentence shall be: $50,000 
                        aggregate liability for any single-
                        family dwelling, and $150,000 for any 
                        residential structure containing more 
                        than one dwelling unit;
                  (B) in the case of business properties which 
                are owned or leased and operated by small 
                business concerns, an aggregate liability with 
                respect to any single structure, including any 
                contents thereof related to premises of small 
                business occupants (as term is defined by the 
                Administrator), which shall be equal to (i) 
                $100,000 plus (ii) $100,000 multiplied by the 
                number of such occupants and shall be allocated 
                among such occupants (or among the occupant or 
                occupants and the owner) under regulations 
                prescribed by the Administrator; except that 
                the aggregate liability for the structure 
                itself may in no case exceed $100,000; and
                  (C) in the case of church properties which 
                may become eligible for flood insurance under 
                section 1305--
                          (i) $100,000 aggregate liability for 
                        any single structure, and
                          (ii) $100,000 aggregate liability per 
                        unit for any contents related to such 
                        unit; and
          (2) in the case of any residential building designed 
        for the occupancy of from 1 to 4 families for which the 
        risk premium rate is determined in accordance with the 
        provisions of section 1307(a)(1), additional flood 
        insurance in excess of the limits specified in clause 
        (i) of subparagraph (A) of paragraph (1) shall be made 
        available, with respect to any single such building, up 
        to an aggregate liability (including such limits 
        specified in paragraph (1)(A)(i)) of $250,000;
          (3) in the case of any residential property for which 
        the risk premium rate is determined in accordance with 
        the provisions of section 1307(a)(1), additional flood 
        insurance in excess of the limits specified in clause 
        (ii) of subparagraph (A) of paragraph (1) shall be made 
        available to every insured upon renewal and every 
        applicant for insurance so as to enable any such 
        insured or applicant to receive coverage up to a total 
        amount (including such limits specified in paragraph 
        (1)(A)(ii)) of $100,000;
          (4) in the case of any nonresidential building, 
        including a church, for which the risk premium rate is 
        determined in accordance with the provisions of section 
        1307(a)(1), additional flood insurance in excess of the 
        limits specified in subparagraphs (B) and (C) of 
        paragraph (1) shall be made available with respect to 
        any single such building, up to an aggregate liability 
        (including such limits specified in subparagraph (B) or 
        (C) of paragraph (1), as applicable) of $500,000, and 
        coverage shall be made available up to a total of 
        $500,000 aggregate liability for contents owned by the 
        building owner and $500,000 aggregate liability for 
        each unit within the building for contents owned by the 
        tenant; and
          (5) any flood insurance coverage which may be made 
        available in excess of the limits specified in 
        subparagraph (A), (B), or (C) of paragraph (1), shall 
        be based only on chargeable premium rates under section 
        1308 which are not less than the estimated premium 
        rates under section 1307(a)(1), and the amount of such 
        excess coverage shall not in any case exceed an amount 
        equal to the applicable limit so specified (or 
        allocated) under paragraph (1)(C), (2), (3), or (4), as 
        applicable.
  (c) Effective Date of Policies.--
          (1) Waiting period.--Except as provided in paragraph 
        (2), coverage under a new contract for flood insurance 
        coverage under this title entered into after the date 
        of enactment of the Riegle Community Development and 
        Regulatory Improvement Act of 1994, and any 
        modification to coverage under an existing flood 
        insurance contract made after such date, shall become 
        effective upon the expiration of the 30-day period 
        beginning on the date that all obligations for such 
        coverage (including completion of the application and 
        payment of any initial premiums owed) are 
        satisfactorily completed.
          (2) Exception.--The provisions of paragraph (1) shall 
        not apply to--
                  (A) the initial purchase of flood insurance 
                coverage under this title when the purchase of 
                insurance is in connection with the making, 
                increasing, extension, or renewal of a loan;
                  (B) the initial purchase of flood insurance 
                coverage pursuant to a revision or updating of 
                floodplain areas or flood-risk zones under 
                section 1360(f), if such purchase occurs during 
                the 1-year period beginning upon publication of 
                notice of the revision or updating under 
                section 1360(h); or
                  (C) the initial purchase of flood insurance 
                coverage for private property if--
                          (i) the Administrator determines that 
                        the property is affected by flooding on 
                        Federal land that is a result of, or is 
                        exacerbated by, post-wildfire 
                        conditions, after consultation with an 
                        authorized employee of the Federal 
                        agency that has jurisdiction of the 
                        land on which the wildfire that caused 
                        the post-wildfire conditions occurred; 
                        and
                          (ii) the flood insurance coverage was 
                        purchased not later than 60 days after 
                        the fire containment date, as 
                        determined by the appropriate Federal 
                        employee, relating to the wildfire that 
                        caused the post-wildfire conditions 
                        described in clause (i).
  (d) Optional High-Deductible Policies for Residential 
Properties.--
          (1) Availability.--In the case of residential 
        properties, the Administrator shall make flood 
        insurance coverage available, at the option of the 
        insured, that provides for a loss-deductible for damage 
        to the covered property in various amounts, up to and 
        including $10,000.
          (2) Disclosure.--
                  (A) Form.--The Administrator shall provide 
                the information described in subparagraph (B) 
                clearly and conspicuously on the application 
                form for flood insurance coverage or on a 
                separate form, segregated from all unrelated 
                information and other required disclosures.
                  (B) Information.--The information described 
                in this subparagraph is--
                          (i) information sufficient to inform 
                        the applicant of the availability of 
                        the coverage option required by 
                        paragraph (1) to applicants for flood 
                        insurance coverage; and
                          (ii) a statement explaining the 
                        effect of a loss-deductible and that, 
                        in the event of an insured loss, the 
                        insured is responsible out-of-pocket 
                        for losses to the extent of the 
                        deductible selected.
  (e) Refund of Unearned Premiums for Policies Canceled Because 
of Replacement With Private Flood Insurance.--
          (1) Required refund.--Subject to subsection (c), if 
        at any time an insured under a policy for flood 
        insurance coverage for a property that is made 
        available under this title cancels such policy because 
        other duplicate flood insurance coverage for the same 
        property has been obtained from a source other than the 
        National Flood Insurance Program under this title, the 
        Administrator shall refund to the former insured a 
        portion of the premiums paid for the coverage made 
        available under this title, as determined consistent 
        with industry practice according to the portion of the 
        term of the policy that such coverage was in effect, 
        but only if a copy of declarations page of the new 
        policy obtained from a source other than the program 
        under this title is provided to the Administrator.
          (2) Effective date of cancellation.--For purposes of 
        this subsection, a cancellation of a policy for 
        coverage made available under the national flood 
        insurance program under this title, for the reason 
        specified in paragraph (1), shall be effective--
                  (A) on the effective date of the new policy 
                obtained from a source other than the program 
                under this title, if the request for such 
                cancellation was received by the Administrator 
                before the expiration of the 6-month period 
                beginning on the effective date of the new 
                policy; or
                  (B) on the date of the receipt by the 
                Administrator of the request for cancellation, 
                if the request for such cancellation was 
                received by the Administrator after the 
                expiration of the 6-month period beginning on 
                the effective date of the new policy.
          (3) Prohibition of refunds for properties receiving 
        increased cost of compliance claims.--No premium 
        amounts paid for coverage made available under this 
        title may be refunded pursuant to this subsection--
                  (A) with respect to coverage for any property 
                for which measures have been implemented using 
                amounts received pursuant to a claim under 
                increased cost of compliance coverage made 
                available pursuant to section 1304(b); or
                  (B) if a claim has been paid or is pending 
                under the policy term for which the refund is 
                sought.
  [(b)] (f) Minimum Annual Deductible.--
          (1) Pre-firm properties.--For any structure which is 
        covered by flood insurance under this title, and on 
        which construction or substantial improvement occurred 
        on or before December 31, 1974, or before the effective 
        date of an initial flood insurance rate map published 
        by the Administrator under section 1360 for the area in 
        which such structure is located, the minimum annual 
        deductible for damage to such structure shall be--
                  (A) $1,500, if the flood insurance coverage 
                for such structure covers loss of, or physical 
                damage to, such structure in an amount equal to 
                or less than $100,000; and
                  (B) $2,000, if the flood insurance coverage 
                for such structure covers loss of, or physical 
                damage to, such structure in an amount greater 
                than $100,000.
          (2) Post-firm properties.--For any structure which is 
        covered by flood insurance under this title, and on 
        which construction or substantial improvement occurred 
        after December 31, 1974, or after the effective date of 
        an initial flood insurance rate map published by the 
        Administrator under section 1360 for the area in which 
        such structure is located, the minimum annual 
        deductible for damage to such structure shall be--
                  (A) $1,000, if the flood insurance coverage 
                for such structure covers loss of, or physical 
                damage to, such structure in an amount equal to 
                or less than $100,000; and
                  (B) $1,250, if the flood insurance coverage 
                for such structure covers loss of, or physical 
                damage to, such structure in an amount greater 
                than $100,000.
          (3) Certain multiple-loss properties.--
        Notwithstanding paragraph (1) or (2), the minimum 
        annual deductible for damage to any severe repetitive-
        loss property or extreme repetitive-loss property shall 
        be not less than $5,000.

                       estimates of premium rates

  Sec. 1307. (a) The Administrator is authorized to undertake 
and carry out such studies and investigations and receive or 
exchange such information as may be necessary to estimate, and 
shall from time to time estimate, on an area, subdivision, or 
other appropriate basis--
          (1) the risk premium rates for flood insurance 
        which--
                  (A) based on consideration of--
                          (i) the risk involved and accepted 
                        actuarial principles; [and]
                          (ii) the flood mitigation activities 
                        that an owner or lessee has undertaken 
                        on a property, including differences in 
                        the risk involved due to land use 
                        measures, floodproofing, flood 
                        forecasting, and similar measures, 
                        [and]
                          (iii) the differences in flood risk 
                        for properties impacted by coastal 
                        flood risk and properties impacted by 
                        riverine, or inland flood risk; and
                          (iv) both the risk identified by the 
                        applicable flood insurance rate maps 
                        and by other risk assessment data and 
                        tools, including risk assessment models 
                        and scores from appropriate sources; 
                        and
                  (B) including--
                          (i) the applicable operating costs 
                        and allowances set forth in the 
                        schedules prescribed under section 1311 
                        and reflected in such rates,
                          (ii) any administrative expenses (or 
                        portion of such expenses) of carrying 
                        out the flood insurance program which, 
                        in his discretion, should properly be 
                        reflected in such rates,
                          (iii) any remaining administrative 
                        expenses incurred in carrying out the 
                        flood insurance and floodplain 
                        management programs (including the 
                        costs of mapping activities under 
                        section 1360) not included under clause 
                        (ii), which shall be recovered by a fee 
                        charged to policyholders and such fee 
                        shall not be subject to any agents' 
                        commissions, company expense 
                        allowances, or State or local premium 
                        taxes, and
                          (iv) all costs, as prescribed by 
                        principles and standards of practice in 
                        ratemaking adopted by the American 
                        Academy of Actuaries and the Casualty 
                        Actuarial Society, including--
                                  (I) an estimate of the 
                                expected value of future costs,
                                  (II) all costs associated 
                                with the transfer of risk, and
                                  (III) the costs associated 
                                with an individual risk 
                                transfer with respect to risk 
                                classes, as defined by the 
                                Administrator,
        would be required in order to make such insurance 
        available on an actuarial basis for any types and 
        classes of properties for which insurance coverage is 
        available under section 1305(a) (or is recommended to 
        the Congress under section 1305(b));
          (2) the rates, if less than the rates estimated under 
        paragraph (1), which would be reasonable, would 
        encourage prospective insureds to purchase flood 
        insurance, and would be consistent with the purposes of 
        this title, and which, together with a fee charged to 
        policyholders that shall not be not subject to any 
        agents' commission, company expenses allowances, or 
        State or local premium taxes, shall include any 
        administrative expenses incurred in carrying out the 
        flood insurance and floodplain management programs 
        (including the costs of mapping activities under 
        section 1360), except that the Administrator shall not 
        estimate rates under this paragraph for--
                  (A) any residential property which is not the 
                primary residence of an individual;
                  (B) any severe repetitive loss property;
                  [(C) any property that has incurred flood-
                related damage in which the cumulative amounts 
                of payments under this title equaled or 
                exceeded the fair market value of such 
                property;]
                  (C) any extreme repetitive-loss property;
                  (D) any business property; [or]
                  (E) any property which on or after the date 
                of enactment of the Biggert-Waters Flood 
                Insurance Reform Act of 2012 has experienced or 
                sustained--
                          (i) substantial damage exceeding 50 
                        percent of the [fair] market value of 
                        such property; or
                          (ii) substantial improvement 
                        exceeding 50 percent of the [fair] 
                        market value of such property; [and] or
                  (F) any repetitive-loss property that has 
                received a claim payment for flood loss under 
                coverage made available under this title that 
                occurred after the date of enactment of this 
                Act; and
          (3) the extent, if any, to which federally assisted 
        or other flood protection measures initiated after the 
        date of the enactment of this title affect such rates.
  (b) In carrying out subsection (a), the Administrator shall, 
to the maximum extent feasible and on a reimbursable basis, 
utilize the services of the Department of the Army, the 
Department of the Interior, The Department of Agriculture, the 
Department of Commerce, and the Tennessee Valley Authority, 
and, as appropriate, other Federal departments or agencies, and 
for such purposes may enter into agreements or other 
appropriate arrangements with any persons.
  (c) The Administrator shall give priority to conducting 
studies and investigations and making estimates under this 
section in those States or areas (or subdivisions thereof) 
which he has determined have evidenced a positive interest in 
securing flood insurance coverage under the flood insurance 
program.
  (d) Notwithstanding any other provision of law, any structure 
existing on the date of enactment of the Flood Disaster 
Protection Act of 1973 and located within Avoyelles, 
Evangeline, Rapides, or Saint Landry Parish in the State of 
Louisiana, which the Administrator determines is subject to 
additional flood hazards as a result of the construction or 
operation of the Atchafalaya Basin Levee System, shall be 
eligible for flood insurance under this title (if and to the 
extent it is eligible for such insurance under the other 
provisions of this title) at premium rates that shall not 
exceed those which would be applicable if such additional 
hazards did not exist.
  (e) Notwithstanding any other provision of law, any community 
that has made adequate progress, acceptable to the 
Administrator, on the construction or reconstruction of a flood 
protection system which will afford flood protection for the 
one-hundred-year frequency flood as determined by the 
Administrator, shall be eligible for flood insurance under this 
title (if and to the extent it is eligible for such insurance 
under the other provisions of this title) at premium rates not 
exceeding those which would be applicable under this section if 
such flood protection system had been completed. The 
Administrator shall find that adequate progress on the 
construction or reconstruction of a flood protection system, 
based on the present value of the completed flood protection 
system, has been made only if: (1) 100 percent of the cost of 
the system has been authorized; (2) at least 60 percent of the 
cost of the system has been appropriated; (3) at least 50 
percent of the cost of the system has been expended; and (4) 
the system is at least 50 percent completed.Notwithstanding any 
other provision of law, in determining whether a community has 
made adequate progress on the construction, reconstruction, or 
improvement of a flood protection system, the Administrator 
shall consider all sources of funding, including Federal, 
State, and local funds.
  (f) Notwithstanding any other provision of law, this 
subsection shall apply to riverine and coastal levees that are 
located in a community which has been determined by the 
Administrator of the Federal Emergency Management Agency to be 
in the process of restoring flood protection afforded by a 
flood protection system that had been previously accredited on 
a Flood Insurance Rate Map as providing 100-year frequency 
flood protection but no longer does so, and shall apply without 
regard to the level of Federal funding of or participation in 
the construction, reconstruction, or improvement of the flood 
protection system. Except as provided in this subsection, in 
such a community, flood insurance shall be made available to 
those properties impacted by the disaccreditation of the flood 
protection system at premium rates that do not exceed those 
which would be applicable to any property located in an area of 
special flood hazard, the construction of which was started 
prior to the effective date of the initial Flood Insurance Rate 
Map published by the Administrator for the community in which 
such property is located. A revised Flood Insurance Rate Map 
shall be prepared for the community to delineate as Zone AR the 
areas of special flood hazard that result from the 
disaccreditation of the flood protection system. A community 
will be considered to be in the process of restoration if--
          (1) the flood protection system has been deemed 
        restorable by a Federal agency in consultation with the 
        local project sponsor;
          (2) a minimum level of flood protection is still 
        provided to the community by the disaccredited system; 
        and
          (3) restoration of the flood protection system is 
        scheduled to occur within a designated time period and 
        in accordance with a progress plan negotiated between 
        the community and the Federal Emergency Management 
        Agency.
Communities that the Administrator of the Federal Emergency 
Management Agency determines to meet the criteria set forth in 
paragraphs (1) and (2) as of January 1, 1992, shall not be 
subject to revised Flood Insurance Rate Maps that contravene 
the intent of this subsection. Such communities shall remain 
eligible for C zone rates for properties located in zone AR for 
any policy written prior to promulgation of final regulations 
for this section. Floodplain management criteria for such 
communities shall not require the elevation of improvements to 
existing structures and shall not exceed 3 feet above existing 
grade for new construction, provided the base flood elevation 
based on the disaccredited flood control system does not exceed 
five feet above existing grade, or the remaining new 
construction in such communities is limited to infill sites, 
rehabilitation of existing structures, or redevelopment of 
previously developed areas.
The Administrator of the Federal Emergency Management Agency 
shall develop and promulgate regulations to implement this 
subsection, including minimum floodplain management criteria, 
within 24 months after the date of enactment of this 
subsection.
  (g) No Extension of Subsidy to New Policies or Lapsed 
Policies.--The Administrator shall not provide flood insurance 
to prospective insureds at rates less than those estimated 
under subsection (a)(1), as required by paragraph (2) of that 
subsection, for--
          (1) any policy under the flood insurance program that 
        has lapsed in coverage,, unless the decision of the 
        policy holder to permit a lapse in flood insurance 
        coverage was as a result of the property covered by the 
        policy no longer being required to retain such 
        coverage; or
          (2) any prospective insured who refuses to accept any 
        offer for mitigation assistance by the Administrator 
        (including an offer to relocate), including an offer of 
        mitigation assistance--
                  (A) following a major disaster, as defined in 
                section 102 of the Robert T. Stafford Disaster 
                Relief and Emergency Assistance Act (42 U.S.C. 
                5122); or
                  [(B) in connection with--
                          [(i) a repetitive loss property; or
                          [(ii) a severe repetitive loss 
                        property.]
                  (B) in connection with a multiple-loss 
                property.
  [(h) Definition.--In this section, the term ``severe 
repetitive loss property'' has the following meaning:
          [(1) Single-family properties.--In the case of a 
        property consisting of 1 to 4 residences, such term 
        means a property that--
                  [(A) is covered under a contract for flood 
                insurance made available under this title; and
                  [(B) has incurred flood-related damage--
                          [(i) for which 4 or more separate 
                        claims payments have been made under 
                        flood insurance coverage under this 
                        chapter, with the amount of each such 
                        claim exceeding $5,000, and with the 
                        cumulative amount of such claims 
                        payments exceeding $20,000; or
                          [(ii) for which at least 2 separate 
                        claims payments have been made under 
                        such coverage, with the cumulative 
                        amount of such claims exceeding the 
                        value of the property.
          [(2) Multifamily properties.--In the case of a 
        property consisting of 5 or more residences, such term 
        shall have such meaning as the Director shall by 
        regulation provide.]

               establishment of chargeable premium rates

  Sec. 1308. (a) On the basis of estimates made under section 
1307 and such other information as may be necessary, the 
Administrator shall from time to time prescribe, after 
providing notice--
          (1) chargeable premium rates for any types and 
        classes of properties for which insurance coverage 
        shall be available under section 1305 (at less than the 
        estimated risk premium rates under section 1307(a)(1), 
        where necessary), and
          (2) the terms and conditions under which, and the 
        areas (including subdivisions thereof) within which 
        such rates shall apply.
  (b) Such rates shall, insofar as practicable, be--
          (1) based on a consideration of the respective risks 
        involved, including differences in risks due to 
        differences in flood risk resulting from coastal flood 
        hazards and riverine, or inland flood hazards and due 
        to land use measures, flood-proofing, flood 
        forecasting, and similar measures, taking into account 
        both the risk identified by the applicable flood 
        insurance rate maps and by other risk assessment data 
        and tools, including risk assessment models and scores 
        from appropriate sources ;
          (2) adequate, on the basis of accepted actuarial 
        principles, to provide reserves for anticipated losses, 
        or if less than such amount consistent with the 
        objective of making flood insurance available where 
        necessary at reasonable rates so as to encourage 
        prospective insureds to purchase such insurance and 
        with the purposes of this title;
          (3) adequate, together with the fee under paragraph 
        (1)(B)(iii) or (2) of section 1307(a), to provide for 
        any administrative expenses of the flood insurance and 
        floodplain management programs (including the costs of 
        mapping activities under section 1360);
          (4) stated so as to reflect the basis for such rates, 
        including the differences (if any) between the 
        estimated risk premium rates under section 1307(a)(1) 
        and the estimated rates under section 1307(a)(2); and
          (5) adequate, on the basis of accepted actuarial 
        principles, to cover the average historical loss year 
        obligations incurred by the National Flood Insurance 
        Fund.
  (c) Actuarial Rate Properties.--Subject only to the 
limitations provided under paragraphs (1) and (2), the 
chargeable rate shall not be less than the applicable estimated 
risk premium rate for such area (or subdivision thereof) under 
section 1307(a)(1) with respect to the following properties:
          (1) Post-firm properties.--Any property the 
        construction or substantial improvement of which the 
        Administrator determines has been started after 
        December 31, 1974, or started after the effective date 
        of the initial rate map published by the Administrator 
        under paragraph (2) of section 1360 for the area in 
        which such property is located, whichever is later, 
        except that the chargeable rate for properties under 
        this paragraph shall be subject to the limitation under 
        subsection (e).
          (2) Certain leased coastal and river properties.--Any 
        property leased from the Federal Government (including 
        residential and nonresidential properties) that the 
        Administrator determines is located on the river-facing 
        side of any dike, levee, or other riverine flood 
        control structure, or seaward of any seawall or other 
        coastal flood control structure.
  (d) With respect to any chargeable premium rate prescribed 
under this section, a sum equal to the portion of the rate that 
covers any administrative expenses of carrying out the flood 
insurance and floodplain management programs which have been 
estimated under paragraphs (1)(B)(ii) and (1)(B)(iii) of 
section 1307(a) or paragraph (2) of such section (including the 
fees under such paragraphs), shall be paid to the 
Administrator. The Administrator shall deposit the sum in the 
National Flood Insurance Fund established under section 1310.
  (e) Annual Limitation on Premium Increases.--Except with 
respect to properties described under paragraph (2) of 
subsection (c), and notwithstanding any other provision of this 
title--
          (1) the chargeable risk premium rate for flood 
        insurance under this title for any property may not be 
        increased by more than [18 percent] 15 percent each 
        year, except--
                  (A) as provided in paragraph (4);
                  (B) in the case of property identified under 
                section 1307(g); or
                  (C) in the case of a property that--
                          (i) is located in a community that 
                        has experienced a rating downgrade 
                        under the community rating system 
                        program carried out under section 
                        1315(b);
                          (ii) is covered by a policy with 
                        respect to which the policyholder has--
                                  (I) decreased the amount of 
                                the deductible; or
                                  (II) increased the amount of 
                                coverage; or
                          (iii) was misrated;
          (2) the chargeable risk premium rates for flood 
        insurance under this title for any properties initially 
        rated under section 1307(a)(2) within any single risk 
        classification, excluding properties for which the 
        chargeable risk premium rate is not less than the 
        applicable estimated risk premium rate under section 
        1307(a)(1), shall be increased by an amount that 
        results in an average of such rate increases for 
        properties within the risk classification during any 
        12-month period of not less than [5 percent] 8 percent 
        of the average of the risk premium rates for such 
        properties within the risk classification upon the 
        commencement of such 12-month period;
          (3) the chargeable risk premium rates for flood 
        insurance under this title for any properties within 
        any single risk classification may not be increased by 
        an amount that would result in the average of such rate 
        increases for properties within the risk classification 
        during any 12-month period exceeding 15 percent of the 
        average of the risk premium rates for properties within 
        the risk classification upon the commencement of such 
        12-month period; [and]
          (4) the chargeable risk premium rates for flood 
        insurance under this title for any properties described 
        in subparagraphs (A) through (E) of section 1307(a)(2) 
        shall be increased by 25 percent each year, until the 
        average risk premium rate for such properties is equal 
        to the average of the risk premium rates for properties 
        [described under paragraph (3).] estimated under 
        section 1307(a)(1); and
          (5) the chargeable risk premium rates for flood 
        insurance under this title for any properties described 
        in subparagraph (F) of section 1307(a)(2) shall be 
        increased by not less than 15 percent each year, until 
        the average risk premium rate for such properties is 
        equal to the average of the risk premium rates for 
        properties estimated under section 1307(a)(1).
  (f) Adjustment of Premium.--Notwithstanding any other 
provision of law, if the Administrator determines that the 
holder of a flood insurance policy issued under this Act is 
paying a lower premium than is required under this section due 
to an error in the flood plain determination, the Administrator 
may only prospectively charge the higher premium rate.
  (g) Frequency of Premium Collection.--
          (1) Options.--With respect to any chargeable premium 
        rate prescribed under this section, the Administrator 
        shall provide policyholders that are not required to 
        escrow their premiums and fees for flood insurance as 
        set forth under section 102 of the Flood Disaster 
        Protection Act of 1973 (42 U.S.C. 4012a) with the 
        option of paying their premiums annually or monthly.
          (2) Monthly installment payment of premiums.--
                  (A) Exemption from rulemaking.--Until such 
                time as the Administrator promulgates 
                regulations implementing paragraph (1) of this 
                subsection, the Administrator may adopt 
                policies and procedures, notwithstanding any 
                other provisions of law and in alignment and 
                consistent with existing industry escrow and 
                servicing standards, necessary to implement 
                such paragraph without undergoing notice and 
                comment rulemaking and without conducting 
                regulatory analyses otherwise required by 
                statute, regulation, or Executive order.
                  (B) Installment plan fee.--The Administrator 
                may charge policyholders choosing to pay 
                premiums in monthly installments a fee not to 
                exceed $50 annually.
                  (C) Pilot program.--The Administrator may 
                initially implement paragraph (1) of this 
                subsection as a pilot program that provides for 
                a gradual phase-in of implementation.
  (h) Rule of Construction.--For purposes of this section, the 
calculation of an ``average historical loss year''--
          (1) includes catastrophic loss years; and
          (2) shall be computed in accordance with generally 
        accepted actuarial principles.
  (i) [Rates for Properties Newly Mapped into Areas with 
Special Flood Hazards.--] Rates for Properties Newly Mapped 
Into Areas With Special Flood Hazards._
          [(1)] [Notwithstanding] (1) In general.--Except as 
        provided in paragraph (2) and notwithstanding 
        subsection (f), the premium rate for flood insurance 
        under this title that is purchased on or after the date 
        of the enactment of this subsection--
                  [(1)] (A) on a property located in an area 
                not previously designated as having special 
                flood hazards and that, pursuant to any 
                issuance, revision, updating, or other change 
                in a flood insurance map, becomes designated as 
                such an area; and--
                  [(2)] (B) where such flood insurance premium 
                rate is calculated under subsection (a)(1) of 
                section 1307 (42 U.S.C. 4014(a)(1)),
        shall for the first policy year be the preferred risk 
        premium for the property and upon renewal shall be 
        calculated in accordance with subsection (e) of this 
        section until the rate reaches the rate calculated 
        under subsection (a)(1) of section 1307.
          (2) Inapplicability to multiple-loss properties.--
        Paragraph (1) shall not apply to multiple-loss 
        properties.
  (j) Premiums and Reports.--In setting premium risk rates, in 
addition to striving to achieve the objectives of this title 
the Administrator shall also strive to minimize the number of 
policies with annual premiums that exceed one percent of the 
total coverage provided by the policy. For any policies 
premiums that exceed this one percent threshold, the 
Administrator shall report such exceptions to the Committee on 
Financial Services of the House of Representatives and the 
Committee on Banking, Housing, and Urban Affairs of the Senate.
  (k) Consideration of Mitigation Methods.--In calculating the 
risk premium rate charged for flood insurance for a property 
under this section, the Administrator shall take into account 
the implementation of any mitigation method identified by the 
Administrator in the guidance issued under section 1361(d) (42 
U.S.C. 4102(d)).
  [(l) Clear Communications.--The Administrator shall clearly 
communicate full flood risk determinations to individual 
property owners regardless of whether their premium rates are 
full actuarial rates.]
  (l) Clear Communications.--
          (1) Newly issued and renewed policies.--For all 
        policies for flood insurance coverage under the 
        National Flood Insurance Program that are newly issued 
        or renewed, the Administrator shall clearly communicate 
        to policyholders--
                  (A) their full flood risk determinations, 
                regardless of whether their premium rates are 
                full actuarial rates; and
                  (B) the number and dollar value of claims 
                filed for the property, over the life of the 
                property, under a flood insurance policy made 
                available under the Program and the effect, 
                under this Act, of filing any further claims 
                under a flood insurance policy with respect to 
                that property.
          (2) Multiple-loss properties.--Pursuant to paragraph 
        (1), the Administrator shall clearly communicate to all 
        policyholders for multiple-loss properties the effect 
        on the premium rates charged for such a property of 
        filing any further claims under a flood insurance 
        policy with respect to that property.
  (m) Protection of Small Businesses, Non-Profits, Houses of 
Worship, and Residences.--
          (1) Report.--Not later than 18 months after the date 
        of the enactment of this section and semiannually 
        thereafter, the Administrator shall monitor and report 
        to Committee on Financial Services of the House 
        Representatives and the Committee on Banking, Housing, 
        and Urban Affairs of the Senate, the Administrator's 
        assessment of the impact, if any, of the rate increases 
        required under subparagraphs (A) and (D) of section 
        1307(a)(2) and the surcharges required under section 
        1308A on the affordability of flood insurance for--
                  (A) small businesses with less than 100 
                employees;
                  (B) non-profit entities;
                  (C) houses of worship; and
                  (D) residences with a value equal to or less 
                than 25 percent of the median home value of 
                properties in the State in which the property 
                is located.
          (2) Recommendations.--If the Administrator determines 
        that the rate increases or surcharges described in 
        paragraph (1) are having a detrimental effect on 
        affordability, including resulting in lapsed policies, 
        late payments, or other criteria related to 
        affordability as identified by the Administrator, for 
        any of the properties identified in subparagraphs (A) 
        through (D) of such paragraph, the Administrator shall, 
        not later than 3 months after making such a 
        determination, make such recommendations as the 
        Administrator considers appropriate to improve 
        affordability to the Committee on Financial Services of 
        the House of Representatives and the Committee on 
        Banking, Housing, and Urban Affairs of the Senate.
  (n) Disclosure of Premium Methodology.--
          (1) Disclosure.--Six months prior to the effective 
        date of risk premium rates, the Administrator shall 
        cause to be published in the Federal Register an 
        explanation of the bases for, and methodology used to 
        determine, the chargeable premium rates to be effective 
        for flood insurance coverage under this title.
          (2) Alignment with industry practices.--The 
        disclosure required under paragraph (1) shall, to the 
        extent practicable, be aligned with industry patterns 
        and practices and shall include information and data 
        recommended by the State insurance commissioners 
        guidelines on rate filings.
          (3) Public meetings.--The Administrator shall, on an 
        annual basis, hold at least one public meeting in each 
        of the geographical regions of the United States, as 
        defined by the Administrator for purposes of the 
        National Flood Insurance Program, for the purpose of 
        explaining the methodology described in paragraph (1) 
        and answering questions and receiving comments 
        regarding such methodology. The Administrator shall 
        provide notice of each such public meeting in advance, 
        in such manner, and in using such means as are 
        reasonably designed to notify interested parties and 
        members of the public of the date and time, location, 
        and purpose of such meeting, and of how to submit 
        questions or comments.
  (o) Premium Adjustment To Reflect Current Flood Risk.--
          (1) In general.--Except as provided in paragraph (2), 
        the Administrator shall rate a multiple-loss property 
        that is charged a risk premium rate estimated under 
        section 1307(a)(1) (42 U.S.C. 4014(a)(1)) based on the 
        current risk of flood reflected in the flood insurance 
        rate map in effect at the time of rating.
          (2) Adjustment for existing policies.--For policies 
        for flood insurance under this title in force on the 
        date of the enactment of this Act for properties 
        described in paragraph (1)--
                  (A) notwithstanding subsection (e) of this 
                section, the Administrator shall increase risk 
                premium rates by not less than 15 percent each 
                year until such rates comply with paragraph (1) 
                of this subsection; and
                  (B) any rate increases required by paragraph 
                (1) shall commence following a claim payment 
                for flood loss under coverage made available 
                this title that occurred after the date of 
                enactment of this Act.

SEC. 1308A. PREMIUM SURCHARGE.

  (a) Imposition and Collection.--[The Administrator shall 
impose and collect an annual surcharge, in the amount provided 
in subsection (b), on all policies for flood insurance coverage 
under the National Flood Insurance Program that are newly 
issued or renewed after the date of the enactment of this 
section.] The Administrator shall impose and collect a non-
refundable annual surcharge, in the amount provided in 
subsection (b), on all policies for flood insurance coverage 
under the National Flood Insurance Program that are newly 
issued or renewed after the date of the enactment of this 
section. Such surcharge shall be in addition to the surcharge 
under section 1304(b) and any other assessments and surcharges 
applied to such coverage.
  [(b) Amount.--The amount of the surcharge under subsection 
(a) shall be--
          [(1) $25, except as provided in paragraph (2); and
          [(2) $250, in the case of a policy for any property 
        that is--
                  [(A) a non-residential property; or
                  [(B) a residential property that is not the 
                primary residence of an individual.]
  (b) Amount.--The amount of the surcharge under subsection (a) 
shall be $40, except as follows:
          (1) Non-primary residences eligible for prp.--The 
        amount of the surcharge under subsection (a) shall be 
        $125 in the case of in the case of a policy for any 
        property that is--
                  (A) a residential property that is not the 
                primary residence of an individual, and
                  (B) eligible for preferred risk rate method 
                premiums.
          (2) Non-residential properties and non-primary 
        residences not eligible for prp.--The amount of the 
        surcharge under subsection (a) shall be $275 in case of 
        in the case of a policy for any property that is--
                  (A) a non-residential property; or
                  (B) a residential property that is--
                          (i) not the primary residence of an 
                        individual; and
                          (ii) not eligible for preferred risk 
                        rate method premiums.
  (c) Termination.--Subsections (a) and (b) shall cease to 
apply on the date on which the chargeable risk premium rate for 
flood insurance under this title for each property covered by 
flood insurance under this title, other than properties for 
which premiums are calculated under subsection (e) or (f) of 
section 1307 or section 1336 of this Act (42 U.S.C. 4014, 4056) 
or under section 100230 of the Biggert-Waters Flood Insurance 
Reform Act of 2012 (42 U.S.C. 4014 note), is not less than the 
applicable estimated risk premium rate under section 1307(a)(1) 
for such property.

                               financing

  Sec. 1309. (a) All authority which was vested in the Housing 
and Home Finance Administrator by virtue of section 15(e) of 
the Federal Flood Insurance Act of 1956 (70 Stat. 1084) 
(pertaining to the issue of notes or other obligations or the 
Secretary of the Treasury), as amended by subsections (a) and 
(b) of section 1303 of this Act, shall be available to the 
Administrator for the purpose of carrying out the flood 
insurance program under this title; except that the total 
amount of notes and obligations which may be issued by the 
Administrator pursuant to such authority (1) without the 
approval of the President, may not exceed $500,000,000, and (2) 
with the approval of the President, may not exceed 
$1,500,000,000 through the date specified in section 1319, and 
$1,000,000,000 thereafter; except that, through [September 30, 
2017] September 30, 2022 , clause (2) of this sentence shall be 
applied by substituting ``$30,425,000,000'' for 
``$1,500,000,000''. The Administrator shall report to the 
Committee on Banking, Finance and Urban Affairs of the House of 
Representatives and the Committee on Banking, Housing, and 
Urban Affairs of the Senate at any time when he requests the 
approval of the President in accordance with the preceding 
sentence.
  (b) Any funds borrowed by the Administrator under this 
authority shall, from time to time, be deposited in the 
National Flood Insurance Fund established under section 1310.
  (c) Upon the exercise of the authority established under 
subsection (a), the Administrator shall transmit a schedule for 
repayment of such amounts to--
          (1) the Secretary of the Treasury;
          (2) the Committee on Banking, Housing, and Urban 
        Affairs of the Senate; and
          (3) the Committee on Financial Services of the House 
        of Representatives.
  (d) In connection with any funds borrowed by the 
Administrator under the authority established in subsection 
(a), the Administrator, beginning 6 months after the date on 
which such funds are borrowed, and continuing every 6 months 
thereafter until such borrowed funds are fully repaid, shall 
submit a report on the progress of such repayment to--
          (1) the Secretary of the Treasury;
          (2) the Committee on Banking, Housing, and Urban 
        Affairs of the Senate; and
          (3) the Committee on Financial Services of the House 
        of Representatives.
  (e) Independent Actuarial Review.--
          (1) Fiduciary responsibility.--The Administrator has 
        a responsibility to ensure that the National Flood 
        Insurance Program remains financially sound. Pursuant 
        to this responsibility, the Administrator shall from 
        time to time review and eliminate nonessential costs 
        and positions within the Program, unless otherwise 
        authorized or required by law, as the Administrator 
        determines to be necessary.
          (2) Annual independent actuarial study.--The 
        Administrator shall provide for an independent 
        actuarial study of the National Flood Insurance Program 
        to be conducted annually, which shall analyze the 
        financial position of the program based on the long-
        term estimated losses of the program. The Administrator 
        shall submit a report (together with the independent 
        actuarial study) annually to the Committee on Financial 
        Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate describing the results of such study, including 
        a determination of whether the Program has collected 
        revenue sufficient to cover the administrative expenses 
        of carrying out the flood insurance program, which are 
        reflected in the risk premium rates, cost of capital, 
        all other costs associated with the transfer of risks, 
        and expected claims payments during the reporting 
        period, and an overall assessment of the financial 
        status of the Program.
          (3) Determination of actuarial budget deficit.--
                  (A) Requirement.--Within the report submitted 
                under paragraph (2), the Administrator shall 
                issue a determination of whether there exists 
                an actuarial budget deficit for the Program for 
                the year covered in the report. The report 
                shall recommend any changes to the Program, if 
                necessary, to ensure that the program remains 
                financially sound.
                  (B) Basis of determination.--The 
                determination required by subparagraph (A) 
                shall be based solely upon whether the portion 
                of premiums estimated and collected by the 
                Program during the reporting period is 
                sufficient to cover the administrative expenses 
                of carrying out the flood insurance program, 
                which are reflected in the risk premium rates, 
                cost of capital, all other costs associated 
                with the transfer of risk, and expected claims 
                payments for the reporting period.
          (4) Quarterly reports.--During each fiscal year, on a 
        calendar quarterly basis, the Secretary shall cause to 
        be published in the Federal Register or comparable 
        method, with notice to the Committee on Financial 
        Services of the House of Representatives and the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate, information which shall specify--
                  (A) the cumulative volume of policies that 
                have been underwritten under the National Flood 
                Insurance Program during such fiscal year 
                through the end of the quarter for which the 
                report is submitted;
                  (B) the types of policies insured, 
                categorized by risk;
                  (C) any significant changes between actual 
                and projected claim activity;
                  (D) projected versus actual loss rates;
                  (E) the cumulative number of currently 
                insured repetitive-loss properties, severe 
                repetitive-loss properties, and extreme 
                repetitive-loss properties that have been 
                identified during such fiscal year through the 
                end of the quarter for which the report is 
                submitted;
                  (F) the cumulative number of properties that 
                have undergone mitigation assistance, through 
                the National Flood Insurance Program, during 
                such fiscal year through the end of the quarter 
                for which the report is submitted; and
                  (G) the number and location, by State or 
                territory, of each policyholder that has been 
                identified for such fiscal year as an eligible 
                household for purposes of the flood insurance 
                affordability program under section 1326.
        The first quarterly report under this paragraph shall 
        be submitted on the last day of the first quarter of 
        fiscal year 2018, or on the last day of the first full 
        calendar quarter following the enactment of the 21st 
        Century Flood Reform Act, whichever occurs later.

           *       *       *       *       *       *       *


SEC. 1310A. RESERVE FUND.

  (a) Establishment of Reserve Fund.--In carrying out the flood 
insurance program authorized by this chapter, the Administrator 
shall establish in the Treasury of the United States a National 
Flood Insurance Reserve Fund (in this section referred to as 
the ``Reserve Fund'') which shall--
          (1) be an account separate from any other accounts or 
        funds available to the Administrator; and
          (2) be available for meeting the expected future 
        obligations of the flood insurance program, including--
                  (A) the payment of claims;
                  (B) claims adjustment expenses; and
                  (C) the repayment of amounts outstanding 
                under any note or other obligation issued by 
                the Administrator under section 1309(a).
  (b) Reserve Ratio.--Subject to the phase-in requirements 
under subsection (d), the Reserve Fund shall maintain a balance 
equal to--
          (1) 1 percent of the sum of the total potential loss 
        exposure of all outstanding flood insurance policies in 
        force in the prior fiscal year; or
          (2) such higher percentage as the Administrator 
        determines to be appropriate, taking into consideration 
        any circumstance that may raise a significant risk of 
        substantial future losses to the Reserve Fund.
  (c) Maintenance of Reserve Ratio.--
          (1) In general.--The Administrator shall have the 
        authority to establish, increase, or decrease the 
        amount of aggregate annual insurance premiums to be 
        collected for any fiscal year necessary--
                  (A) to maintain the reserve ratio required 
                under subsection (b); and
                  (B) to achieve such reserve ratio, if the 
                actual balance of such reserve is below the 
                amount required under subsection (b).
          (2) Considerations.--In exercising the authority 
        granted under paragraph (1), the Administrator shall 
        consider--
                  (A) the expected operating expenses of the 
                Reserve Fund;
                  (B) the insurance loss expenditures under the 
                flood insurance program;
                  (C) any investment income generated under the 
                flood insurance program; and
                  (D) any other factor that the Administrator 
                determines appropriate, including any 
                provisions relating to chargeable premium rates 
                or annual increases of such rates .
          (3) Limitations.--
                  [(A) Rates.--In exercising the authority 
                granted under paragraph (1), the Administrator 
                shall be subject to all other provisions of 
                this Act, including any provisions relating to 
                chargeable premium rates or annual increases of 
                such rates.]
                  (A) Parity.--In exercising the authority 
                granted under paragraph (1) to increase 
                premiums, the Administrator shall institute a 
                single annual, uniform rate of assessment for 
                all individual policyholders.
                  (B) Use of additional annual insurance 
                premiums.--Notwithstanding any other provision 
                of law or any agreement entered into by the 
                Administrator, the Administrator shall ensure 
                that all amounts attributable to the 
                establishment or increase of annual insurance 
                premiums under paragraph (1) are transferred to 
                the Administrator for deposit into the Reserve 
                Fund, to be available for meeting the expected 
                future obligations of the flood insurance 
                program as described in subsection (a)(2).
          (4) Deposit of premium surcharges.--The Administrator 
        shall deposit in the Reserve Fund any surcharges 
        collected pursuant to section 1308A.
  (d) Phase-in Requirements.--The phase-in requirements under 
this subsection are as follows:
          [(1) In general.--Beginning in fiscal year 2013 and 
        not ending until the fiscal year in which the ratio 
        required under subsection (b) is achieved, in each such 
        fiscal year the Administrator shall place in the 
        Reserve Fund an amount equal to not less than 7.5 
        percent of the reserve ratio required under subsection 
        (b).]
          (1) In general.--Beginning in fiscal year 2018 and 
        not ending until the fiscal year in which the ratio 
        required under subsection (b) is achieved--
                  (A) in each fiscal year the Administrator 
                shall place in the Reserve Fund an amount equal 
                to not less than 7.5 percent of the reserve 
                ratio required under subsection (b); and
                  (B) if in any given fiscal year the 
                Administrator fails to comply with subparagraph 
                (A), for the following fiscal year the 
                Administrator shall increase the rate of the 
                annual assessment pursuant to subsection 
                (c)(3)(A) by at least one percentage point over 
                the rate of the annual assessment pursuant to 
                subsection (c)(3)(A) in effect on the first day 
                of such given fiscal year.
          (2) Amount satisfied.--As soon as the ratio required 
        under subsection (b) is achieved, and except as 
        provided in paragraph (3), the Administrator shall not 
        be required to set aside any amounts for the Reserve 
        Fund nor to increase assessments pursuant to paragraph 
        (1)(B) .
          (3) Exception.--If at any time after the ratio 
        required under subsection (b) is achieved, the Reserve 
        Fund falls below the required ratio under subsection 
        (b), the Administrator shall place in the Reserve Fund 
        for that fiscal year an amount equal to not less than 
        7.5 percent of the reserve ratio required under 
        subsection (b) and paragraph (1)(B) shall apply until 
        the fiscal year in which the ratio required under 
        subsection (b) is achieved .
  (e) Limitation on Reserve Ratio.--In any given fiscal year, 
if the Administrator determines that the reserve ratio required 
under subsection (b) cannot be achieved, the Administrator 
shall submit, on a calendar quarterly basis, a report to 
Congress that--
          (1) describes and details the specific concerns of 
        the Administrator regarding the consequences of the 
        reserve ratio not being achieved;
          (2) demonstrates how such consequences would harm the 
        long-term financial soundness of the flood insurance 
        program; and
          (3) indicates the maximum attainable reserve ratio 
        for that particular fiscal year.
  (f) Investment.--The Secretary of the Treasury shall invest 
such amounts of the Reserve Fund as the Secretary determines 
advisable in obligations issued or guaranteed by the United 
States.

           *       *       *       *       *       *       *


                           payment of claims

  Sec. 1312. (a) In General.--[The Administrator] Subject to 
other provisions of this section, the Administrator is 
authorized to prescribe regulations establishing the general 
method or methods by which proved and approved claims for 
losses may be adjusted and paid for any damage to or loss of 
property which is covered by flood insurance made available 
under the provisions of this title.
  [(c)] (b) Payment of Claims to Condominium Owners.--The 
Administrator may not deny payment for any damage to or loss of 
property which is covered by flood insurance to condominium 
owners who purchased such flood insurance separate and apart 
from the flood insurance purchased by the condominium 
association in which such owner is a member, based solely, or 
in any part, on the flood insurance coverage of the condominium 
association or others on the overall property owned by the 
condominium association.
  (c) Deadline for Approval of Claims.--
          (1) In general.--The Administrator shall provide 
        that, in the case of any claim for damage to or loss of 
        property under flood insurance coverage made available 
        under this title, an initial determination regarding 
        approval of a claim for payment or disapproval of the 
        claim be made, and notification of such determination 
        be provided to the insured making such claim, not later 
        than the expiration of the 120-day period (as such 
        period may be extended pursuant to paragraph (2)) 
        beginning upon the day on which the policyholder 
        submits a signed proof of loss detailing the damage and 
        amount of the loss. Payment of approved claims shall be 
        made as soon as possible after such approval.
          (2) Extension of deadline.--The Administrator shall 
        provide that the period referred to in paragraph (1) 
        may be extended by a single additional period of 15 
        days in cases where extraordinary circumstances are 
        demonstrated. The Administrator shall, by regulation, 
        establish criteria for demonstrating such extraordinary 
        circumstances and for determining to which claims such 
        extraordinary circumstances apply.

              dissemination of flood insurance information

  Sec. 1313. (a) Public Information and Data.--The 
Administrator shall from time to time take such action as may 
be necessary in order to make information and data available to 
the public, and to any State or local agency or official, with 
regard to--
          (1) the flood insurance program, its coverage and 
        objectives, and
          (2) estimated and chargeable flood insurance premium 
        rates, including the basis for and differences between 
        such rates in accordance with the provisions of section 
        1308.
  (b) Availability of Flood Insurance Information Upon 
Request.--Not later than 30 days after a request for such 
information by the current owner of a property, the 
Administrator shall provide to the owner any information, 
including historical information, available to the 
Administrator on flood insurance program coverage, payment of 
claims, and flood damages for the property at issue, and any 
information the Administrator has on whether the property owner 
may be required to purchase coverage under the National Flood 
Insurance Program due to previous receipt of Federal disaster 
assistance, including assistance provided by the Small Business 
Administration, the Department of Housing and Urban 
Development, or the Federal Emergency Management Agency, or any 
other type of assistance that subjects the property to the 
mandatory purchase requirement under section 102 of the Flood 
Disaster Protection Act of 1973 (42 U.S.C. 4012a).

           *       *       *       *       *       *       *


                   state and local land use controls

  Sec. 1315. (a) Requirement for Participation in Flood 
Insurance Program.--
          (1) In general.--After December 31, 1971, no new 
        flood insurance coverage shall be provided under this 
        title in any area (or subdivision thereof) unless an 
        appropriate public body shall have adopted adequate 
        land use and control measures (with effective 
        enforcement provisions) which the Administrator finds 
        are consistent with the comprehensive criteria for land 
        management and use under section 1361.
          (2) Agricultural structures.--
                  (A) Activity restrictions.--Notwithstanding 
                any other provision of law, the adequate land 
                use and control measures required to be adopted 
                in an area (or subdivision thereof) pursuant to 
                paragraph (1) may provide, at the discretion of 
                the appropriate State or local authority, for 
                the repair and restoration to predamaged 
                conditions of an agricultural structure that--
                          (i) is a repetitive loss structure; 
                        or
                          (ii) has incurred flood-related 
                        damage to the extent that the cost of 
                        restoring the structure to its 
                        predamaged condition would equal or 
                        exceed 50 percent of the market value 
                        of the structure before the damage 
                        occurred.
                  (B) Premium rates and coverage.--To the 
                extent applicable, an agricultural structure 
                repaired or restored pursuant to subparagraph 
                (A) shall pay chargeable premium rates 
                established under section 1308 at the estimated 
                risk premium rates under section 1307(a)(1). If 
                resources are available, the Administrator 
                shall provide technical assistance and 
                counseling, upon request of the owner of the 
                structure, regarding wet flood-proofing and 
                other flood damage reduction measures for 
                agricultural structures. The Administrator 
                shall not be required to make flood insurance 
                coverage available for such an agricultural 
                structure unless the structure is wet flood-
                proofed through permanent or contingent 
                measures applied to the structure or its 
                contents that prevent or provide resistance to 
                damage from flooding by allowing flood waters 
                to pass through the structure, as determined by 
                the Administrator.
                  (C) Prohibition on disaster relief.--
                Notwithstanding any other provision of law, any 
                agricultural structure repaired or restored 
                pursuant to subparagraph (A) shall not be 
                eligible for disaster relief assistance under 
                any program administered by the Administrator 
                or any other Federal agency.
                  (D) Definitions.--For purposes of this 
                paragraph--
                          (i) the term ``agricultural 
                        structure'' means any structure used 
                        exclusively in connection with the 
                        production, harvesting, storage, 
                        raising, or drying of agricultural 
                        commodities; and
                          (ii) the term ``agricultural 
                        commodities'' means agricultural 
                        commodities and livestock.
  (b) Community Rating System and Incentives for Community 
Floodplain Management.--
          (1) Authority and goals.--The Administrator shall 
        carry out a community rating system program, under 
        which communities participate voluntarily--
                  (A) to provide incentives for measures that 
                reduce the risk of flood or erosion damage that 
                exceed the criteria set forth in section 1361 
                and evaluate such measures;
                  (B) to encourage adoption of more effective 
                measures that protect natural and beneficial 
                floodplain functions;
                  (C) to encourage floodplain and erosion 
                management; and
                  (D) to promote the reduction of Federal flood 
                insurance losses.
          (2) Incentives.--The program shall provide incentives 
        in the form of credits on premium rates for flood 
        insurance coverage in communities that the 
        Administrator determines have adopted and enforced 
        measures that reduce the risk of flood and erosion 
        damage that exceed the criteria set forth in section 
        1361. In providing incentives under this paragraph, the 
        Administrator [may] shall provide for credits to flood 
        insurance premium rates in communities that the 
        Administrator determines have implemented measures that 
        protect natural and beneficial floodplain functions.
          (3) Credits.--The credits on premium rates for flood 
        insurance coverage shall be based on the estimated 
        reduction in flood and erosion damage risks resulting 
        from the measures adopted by the community under this 
        program, and the Administrator shall provide credits to 
        the maximum number of communities practicable . If a 
        community has received mitigation assistance under 
        section 1366, the credits shall be phased in a manner, 
        determined by the Administrator, to recover the amount 
        of such assistance provided for the community.
          (4) Reports.--Not later than 2 years after the date 
        of enactment of the Riegle Community Development and 
        Regulatory Improvement Act of 1994 and not less than 
        every 2 years thereafter, the Administrator shall 
        submit a report to the Congress regarding the program 
        under this subsection. Each report shall include an 
        analysis of the cost-effectiveness of the program, any 
        other accomplishments or shortcomings of the program, 
        and any recommendations of the Administrator for 
        legislation regarding the program.

           *       *       *       *       *       *       *


                           program expiration

  Sec. 1319. No new contract for flood insurance under this 
title shall be entered into after [September 30, 2017] 
September 30, 2022 .

           *       *       *       *       *       *       *


SEC. 1326. FLOOD INSURANCE AFFORDABILITY PROGRAM.

  (a) Authority.--The Administrator shall carry out a program 
under this section to provide financial assistance, through 
State programs carried out by participating States, for 
eligible low-income households residing in eligible properties 
to purchase policies for flood insurance coverage made 
available under this title.
  (b) Participation.--Participation in the program under this 
section shall be voluntary on the part of a State or consortium 
of States.
  (c) State Administration.--Each participating State shall 
delegate to a State agency or nonprofit organization the 
responsibilities for administrating the State's program under 
this section.
  (d) Eligible Households.--
          (1) In general.--During any fiscal year, assistance 
        under the program under this section may be provided 
        only for a household that has an income, as determined 
        for such fiscal year by the participating State in 
        which such household resides, that is less than the 
        income limitation established for such fiscal year for 
        purposes of the State program by the participating 
        State, except that--
                  (A) assistance under the program under this 
                section may not be provided for a household 
                having a income that exceeds the greater of--
                          (i) the amount equal to 150 percent 
                        of the poverty level for such State; or
                          (ii) the amount equal to 60 percent 
                        of the median income of households 
                        residing in such State; and
                  (B) a State may not exclude a household from 
                eligibility in a fiscal year solely on the 
                basis of household income if such income is 
                less than 110 percent of the poverty level for 
                the State in which such household resides.
          (2) State verification of income eligibility.--In 
        verifying income eligibility for purposes of paragraph 
        (1), the participating State may apply procedures and 
        policies consistent with procedures and policies used 
        by the State agency administering programs under part A 
        of title IV of the Social Security Act (42 U.S.C. 601 
        et seq.), under title XX of the Social Security Act (42 
        U.S.C. 1397 et seq.), under subtitle B of title VI of 
        the Omnibus Budget Reconciliation Act of 1981 (42 
        U.S.C. 9901 et seq.; relating to community services 
        block grant program), under any other provision of law 
        that carries out programs which were administered under 
        the Economic Opportunity Act of 1964 (42 U.S.C. 2701 et 
        seq.) before August 13, 1981, or under other income 
        assistance or service programs (as determined by the 
        State).
          (3) Certification by state of eligibility 
        households.--For each fiscal year, each participating 
        State shall certify to the Administrator compliance of 
        households who are to be provided assistance under the 
        State program during such fiscal year with the income 
        requirements under paragraph (1).
  (e) Eligible Properties.--Assistance under the program under 
this section may be provided only for a residential property--
          (1) that has 4 or fewer residences;
          (2) that is owned and occupied by an eligible 
        household;
          (3) for which a base flood elevation is identified on 
        a flood insurance rate map of the Administrator that is 
        in effect;
          (4) for which such other information is available as 
        the Administrator considers necessary to determine the 
        flood risk associated with such property; and
          (5) that is located in a community that is 
        participating in the national flood insurance program.
  (f) Types of Assistance.--Under the program under this 
section, a participating State shall elect to provide financial 
assistance for eligible households in one of the following 
forms:
          (1) Limitation on rate increases.--By establishing a 
        limitation on the rate of increases in the amount of 
        chargeable premiums paid by eligible households for 
        flood insurance coverage made available under this 
        title.
          (2) Limitation on rates.--By establishing a 
        limitation on the amount of chargeable premiums paid by 
        eligible households for flood insurance coverage made 
        available under this title.
  (g) Notification to FEMA.--Under the program under this 
section, a participating State shall, on a fiscal year basis 
and at the time and in the manner provided by the 
Administrator--
          (1) identify for the Administrator the eligible 
        households residing in the State who are to be provided 
        assistance under the State program during such fiscal 
        year; and
          (2) notify the Administrator of the type and levels 
        of assistance elected under subsection (f) to be 
        provided under the State program with respect to such 
        eligible households residing in the State.
  (h) Amount of Assistance.--Under the program under this 
section, in each fiscal year the Administrator shall, 
notwithstanding section 1308, make flood insurance coverage 
available for purchase by households identified as eligible 
households for such fiscal year by a participating State 
pursuant to subsection (e) at chargeable premium rates that are 
discounted by an amount that is based on the type and levels of 
assistance elected pursuant to subsection (f) by the 
participating State for such fiscal year.
  (i) Billing Statement.--In the case of an eligible household 
for which assistance under the program under this section is 
provided with respect to a policy for flood insurance coverage, 
the annual billing statement for such policy shall include 
statements of the following amounts:
          (1) The estimated risk premium rate for the property 
        under section 1307(a)(1).
          (2) If applicable, the estimated risk premium rate 
        for the property under section 1307(a)(2).
          (3) The chargeable risk premium rate for the property 
        taking into consideration the discount pursuant to 
        subsection (h).
          (4) The amount of the discount pursuant to subsection 
        (h) for the property.
          (5) The number and dollar value of claims filed for 
        the property, over the life of the property, under a 
        flood insurance policy made available under the Program 
        and the effect, under this Act, of filing any further 
        claims under a flood insurance policy with respect to 
        that property.
  (j) Funding Through State Affordability Surcharges.--
          (1) Imposition and collection.--Notwithstanding 
        section 1308, for each fiscal year in which flood 
        insurance coverage under this title is made available 
        for properties in a participating State at chargeable 
        premium rates that are discounted pursuant to 
        subsection (f), the Administrator shall impose and 
        collect a State affordability surcharge on each policy 
        for flood insurance coverage for a property located in 
        such participating State that is (A) not a residential 
        property having 4 or fewer residences, or (B) is such a 
        residential property but is owned by a household that 
        is not an eligible household for purposes of such 
        fiscal year.
          (2) Amount.--The amount of the State affordability 
        surcharge imposed during a fiscal year on each such 
        policy for a property in a participating State shall 
        be--
                  (A) sufficient such that the aggregate amount 
                of all such State affordability surcharges 
                imposed on properties in such participating 
                State during such fiscal year is equal to the 
                aggregate amount by which all policies for 
                flood insurance coverage under this title sold 
                during such fiscal year for properties owned by 
                eligible households in the participating State 
                are discounted pursuant to subsection (f); and
                  (B) the same amount for each property in the 
                participating State being charged such a 
                surplus.
  (k) Treatment of Other Surcharges.--The provision of 
assistance under the program under this section with respect to 
any property and any limitation on premiums or premium 
increases pursuant to subsection (f) for the property shall not 
affect the applicability or amount of any surcharge under 
section 1308A for the property, of any increase in premiums 
charged for the property pursuant to section 1310A(c), or of 
any equivalency fee under section 1308B for the property.
  (l) Definitions.--For purposes of this section, the following 
definitions shall apply:
          (1) Participating state.--The term ``participating 
        State'' means, with respect to a fiscal year, a State 
        that is participating in the program under this section 
        for such fiscal year.
          (2) Eligible household.--The term ``eligible 
        household'' means, with respect to a fiscal year and a 
        participating State, a household that has an income 
        that is less than the amount of the income limitation 
        for the fiscal year established for purposes of the 
        State program of such participating State pursuant to 
        subsection (g)(1).
          (3) Poverty level.--The term ``poverty level''' 
        means, with respect to a household in any State, the 
        income poverty line as prescribed and revised at least 
        annually pursuant to section 673(2) of the Community 
        Services Block Grant Act (42 U.S.C. 9902(2)), as 
        applicable to such State.
          (4) State.--The term ``State'' shall include a 
        consortium of States established for purposes of 
        administrating the program under this section with 
        respect to the member States of the consortium.
          (5) State program.--The term ``State program'' means 
        a program carried out in compliance with this section 
        by a participating State in conjunction with the 
        program under this section of the Administrator.
  (m) Regulations.--The Administrator shall issue such 
regulations as may be necessary to carry out the program under 
this section.

SEC. 1327. DISCLOSURE OF FLOOD RISK INFORMATION UPON TRANSFER OF 
                    PROPERTY.

  (a) Requirement for Participation in Program.--After 
September 30, 2022, no new flood insurance coverage may be 
provided under this title for any real property located in any 
area (or subdivision thereof) unless an appropriate body has 
imposed, by statute or regulation, a duty on any seller or 
lessor of improved real estate located in such area to provide 
to any purchaser or lessee of such property a property flood 
hazard disclosure which the Administrator has determined meets 
the requirements of subsection (b).
  (b) Disclosure Requirements.--A property flood hazard 
disclosure for a property shall meet the requirements of this 
subsection only if the disclosure--
          (1) is made in writing;
          (2) discloses any actual knowledge of the seller or 
        lessor of--
                  (A) prior physical damage caused by flood to 
                any building located on the property;
                  (B) prior insurance claims for losses covered 
                under the National Flood Insurance Program or 
                private flood insurance with respect to such 
                property;
                  (C) any previous notification regarding the 
                designation of the property as a repetitive 
                loss or severe repetitive loss property; and
                  (D) any Federal legal obligation to obtain 
                and maintain flood insurance running with the 
                property, such as any obligation due to a 
                previous form of disaster assistance under the 
                Robert T. Stafford Disaster Relief and 
                Emergency Assistance Act received by any owner 
                of the property; and
          (3) is delivered by or on behalf of the seller or 
        lessor to the purchaser or lessee before such purchaser 
        or lessee becomes obligated under any contract for 
        purchase or lease of the property.

  CHAPTER II--ORGANIZATION AND ADMINISTRATION OF THE FLOOD INSURANCE 
PROGRAM

           *       *       *       *       *       *       *


              Part C--Provisions of General Applicability

                     services by insurance industry

  Sec. 1345. (a) In administering the flood insurance program 
under this chapter, the Administrator is authorized to enter 
into any contracts, agreements, or other appropriate 
arrangements which may, from time to time, be necessary for the 
purpose of utilizing, on such terms and conditions as may be 
agreed upon, the facilities and services of any insurance 
companies or other insurers, insurance agents and brokers, or 
insurance adjustment organizations; and such contracts, 
agreements, or arrangements may include provision for payment 
of applicable operating costs and allowances for such 
facilities and services as set forth in the schedules 
prescribed under section 1311.
  (b) Any such contracts, agreements, or other arrangements may 
be entered into without regard to the provisions of section 
3709 of the Revised Statutes (41 U.S.C. 5) or any other 
provisions of law requiring competitive bidding and without 
regard to the provisions of the Federal Advisory Committee Act 
(5 U.S.C. App.).
  (c) The Administrator of the Federal Emergency Management 
Agency shall hold any agent or broker selling or undertaking to 
sell flood insurance under this title harmless from any 
judgment for damages against such agent or broker as a result 
of any court action by a policyholder or applicant arising out 
of an error or omission on the part of the Federal Emergency 
Management Agency, and shall provide any such agent or broker 
with indemnification, including court costs and reasonable 
attorney fees, arising out of and caused by an error or 
omission on the part of the Federal Emergency Management Agency 
and its contractors. The Administrator of the Federal Emergency 
Management Agency may not hold harmless or indemnify an agent 
or broker for his or her error or omission.
  (d) FEMA Authority on Transfer of Policies.--Notwithstanding 
any other provision of this title, the Administrator may, at 
the discretion of the Administrator, refuse to accept the 
transfer of the administration of policies for coverage under 
the flood insurance program under this title that are written 
and administered by any insurance company or other insurer, or 
any insurance agent or broker.
  (e) Risk Transfer.--The Administrator may secure reinsurance 
of coverage provided by the flood insurance program from the 
private reinsurance and capital markets at rates and on terms 
determined by the Administrator to be reasonable and 
appropriate, in an amount sufficient to maintain the ability of 
the program to pay claims.
  (f) Authority To Provide Other Flood Coverage.--
          (1) In general.--The Administrator may not, as a 
        condition of participating in the Write Your Own 
        Program (as such term is defined in section 1370(a)) or 
        in otherwise participating in the utilization by the 
        Administrator of the facilities and services of 
        insurance companies, insurers, insurance agents and 
        brokers, and insurance adjustment organizations 
        pursuant to the authority in this section, nor as a 
        condition of eligibility to engage in any other 
        activities under the National Flood Insurance Program 
        under this title, restrict any such company, insurer, 
        agent, broker, or organization from offering and 
        selling private flood insurance (as such term is 
        defined in section 102(b)(9) of the Flood Disaster 
        Protection Act of 1973 (42 U.S.C. 4012a(b)(9))).
          (2) Financial assistance/subsidy arrangement.--After 
        the date of the enactment of this subsection--
                  (A) the Administrator may not include in any 
                agreement entered into with any insurer for 
                participation in the Write Your Own Program any 
                provision establishing a condition prohibited 
                by paragraph (1), including the provisions of 
                Article XIII of the Federal Emergency 
                Management Agency, Federal Insurance 
                Administration, Financial Assistance/Subsidy 
                Arrangement, as adopted pursuant to section 
                62.23(a) of title 44 of the Code of Federal 
                Regulations; and
                  (B) any such provision in any such agreement 
                entered into before such date of enactment 
                shall not have any force or effect, and the 
                Administrator may not take any action to 
                enforce such provision.
  (g) Write Your Own Allowance and Program Savings.--
          (1) Allowance rate.--
                  (A) Limitation.--The allowance paid to 
                companies participating in the Write Your Own 
                Program (as such term is defined in section 
                1370 (42 U.S.C. 4004)) with respect to a policy 
                for flood insurance coverage made available 
                under this title shall not be greater than 27.9 
                percent of the chargeable premium for such 
                coverage.
                  (B) Inapplicability.--Subparagraph (A) shall 
                not apply to actual and necessary costs related 
                to section 1312(a) (42 U.S.C, 4019(a)), or to 
                payments deemed necessary by the Administrator.
                  (C) Implementation.--The limitation in 
                subparagraph (A) shall be imposed by equal 
                reductions over the 3-year period beginning on 
                the date of the enactment of this subsection.
          (2) Program savings.--
                  (A) Implementation.--The Administrator, 
                within three years of the date of the enactment 
                of this Act, shall reduce the costs and 
                unnecessary burdens for the companies 
                participating in the Write Your Own program by 
                at least half of the amount by which the 
                limitation under paragraph (1)(A) reduced costs 
                compared to the costs as of the date of the 
                enactment of this subsection.
                  (B) Consideration of savings.--In meeting the 
                requirement of subparagraph (A), the 
                Administrator shall consider savings 
                including--
                          (i) indirect payments by the 
                        Administrator of premium;
                          (ii) eliminating unnecessary 
                        communications requirements;
                          (iii) reducing the frequency of 
                        National Flood Insurance Program 
                        changes;
                          (iv) simplifying the flood rating 
                        system; and
                          (v) other ways of streamlining the 
                        Program to reduce costs while 
                        maintaining customer service and 
                        distribution.

           *       *       *       *       *       *       *


SEC. 1349. PUBLIC AVAILABILITY OF PROGRAM INFORMATION.

  (a) Flood Risk Information.--
          (1) In general.--Except as provided in paragraph (2), 
        to facilitate the National Flood Insurance Program 
        becoming a source of information and data for research 
        and development of technology that better understands 
        flooding, the risk of flooding, and the predictability 
        of perils of flooding, the Administrator shall make 
        publicly available all data, models, assessments, 
        analytical tools, and other information in the 
        possession of the Administrator relating to the 
        National Flood Insurance Program under this title that 
        is used in assessing flood risk or identifying and 
        establishing flood elevations and premiums, including--
                  (A) data relating to risk on individual 
                properties and loss ratio information and other 
                information identifying losses under the 
                program;
                  (B) current and historical policy 
                information, limited to the amount and term 
                only, for properties currently covered by flood 
                insurance and for properties that are no longer 
                covered by flood insurance;
                  (C) current and historical claims 
                information, limited to the date and amount 
                paid only, for properties currently covered by 
                flood insurance and for properties that are no 
                longer covered by flood insurance;
                  (D) identification of whether a property was 
                constructed before or after the effective date 
                of the first flood insurance rate map for a 
                community;
                  (E) identification of properties that have 
                been mitigated through elevation, a buyout, or 
                any other mitigation action; and
                  (F) identification of unmitigated multiple-
                loss properties.
          (2) Open source data system.--In carrying out 
        paragraph (1), the Administrator shall establish an 
        open source data system by which all information 
        required to be made publicly available by such 
        subsection may be accessed by the public on an 
        immediate basis by electronic means.
  (b) Community Information.--Not later than the expiration of 
the 12-month period beginning upon the date of the enactment of 
this section, the Administrator shall establish and maintain a 
publicly searchable database that provides information about 
each community participating in the National Flood Insurance 
Program, which shall include the following information:
          (1) The status of the community's compliance with the 
        National Flood Insurance Program, including any 
        findings of noncompliance, the status of any 
        enforcement actions initiated by a State or by the 
        Administrator, and the number of days of any such 
        continuing noncompliance.
          (2) The number of properties located in the 
        community's special flood hazard areas that were built 
        before the effective date of the first flood insurance 
        rate map for the community.
          (3) The number of properties located in the 
        community's special flood hazard areas that were built 
        after the effective date of the first flood insurance 
        rate map for the community.
          (4) The total number of current and historical claims 
        located outside the community's special flood hazard 
        areas.
          (5) The total number of multiple-loss properties in 
        the community.
          (6) The portion of the community, stated as a 
        percentage and in terms of square miles, that is 
        located within special flood hazard areas.
  (c) Identification of Properties.--The information provided 
pursuant to subsections (a) and (b) shall be based on data that 
identifies properties at the zip code or census block level, 
and shall include the name of the community and State in which 
a property is located.
  (d) Protection of Personally Identifiable Information.--The 
information provided pursuant to subsections (a) and (b) shall 
be disclosed in a format that does not reveal individually 
identifiable information about property owners in accordance 
with the section 552a of title 5, United States Code.
  (e) Definition of Loss Ratio.--For purposes of this section, 
the term ``loss ratio'' means, with respect to the National 
Flood Insurance Program, the ratio of the amount of claims paid 
under the Program to the amount of premiums paid under the 
Program.

SEC. 1350. FLOOD INSURANCE CLEARINGHOUSE.

  (a) Establishment and Operations.--Not later than January 1, 
2021, the Administrator shall establish and commence operations 
of a Flood Insurance Clearinghouse (in this section referred to 
as the ``Clearinghouse)'' in accordance with the report, plan, 
and guidelines required under section 506(b)(2) of the 21st 
Century Flood Reform Act.
  (b) Purpose.--The Clearinghouse shall be established for the 
purpose of receiving applications from prospective insureds for 
flood insurance coverage for properties for which such coverage 
is prohibited under section 1305(f) of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4012(f)) and for providing to 
such applicants offers for such coverage from insurers 
providing private flood insurance (as such term is defined for 
purposes of section 102(c) of the Flood Disaster Protection Act 
of 1973 (42 U.S.C. 4012a(c)) and, subject to the limitations in 
this section, for coverage made available under the National 
Flood Insurance Program.
  (c) Functions.--The Clearinghouse shall have as its 
functions--
          (1) to provide for prospective insureds to submit to 
        the Clearinghouse applications for flood insurance 
        coverage for properties described in subsection (b);
          (2) to determine, with respect to a property 
        identified in an application, the chargeable premium 
        rate for coverage made available under this title;
          (3) with respect to a property identified in an 
        application, to solicit offers of coverage under 
        private flood insurance from providers of such 
        insurance during a reasonable period of time after such 
        application, which offers shall provide terms and 
        conditions of insurance, including deductibles and 
        exclusions, that are sufficient to meet the 
        requirements of section 102 of the Flood Disaster 
        Protection Act of 1973 (42 U.S.C. 4012a); and
          (4) to provide to the applicant for insurance--
                  (A) any bona fide offers for private 
                insurance coverage made pursuant to paragraph 
                (3) for the property identified in the 
                application;
                  (B) in the case only of a property for which 
                such coverage is authorized pursuant to 
                subsection (g) of section 1305, a bona fide 
                offer for flood insurance coverage made 
                available under this title for the property; 
                and
                  (C) information to help the applicant for 
                insurance understand such offers and the 
                limitation under section 1305(g);
  (d) Management and Operation.--The Clearinghouse shall be 
managed and operated by a third party pursuant to a contract 
with the Administrator.
  (e) Agreements.--The Administrator may enter into such 
agreements with insurers providing private flood insurance 
coverage as may be necessary for the Clearinghouse to carry out 
its functions.
  (f) Fees.--The Clearinghouse may charge a fee to applicants 
to cover administrative costs of the Clearinghouse.
  (g) Reports.--The Clearinghouse shall report periodically, as 
determined by the Administrator, to the Administrator regarding 
the operations and activities of the Clearinghouse.

SEC. 1351. RULES OF CONSTRUCTION.

  (a) Definition.--For purposes of this part, the term 
``knowingly'' means having actual knowledge of or acting with 
deliberate ignorance of or reckless disregard for the 
prohibitions under this part.
  (b) Administrative Remedy.--A policyholder of a policy for 
flood insurance coverage made available under this title must 
exhaust all administrative remedies, including submission of 
disputed claims to appeal under any appeal process made 
available by the Administrator, prior to commencing legal 
action on any disputed claim under such a policy.

   CHAPTER III--COORDINATION OF FLOOD INSURANCE WITH LAND-MANAGEMENT 
                     PROGRAMS IN FLOOD-PRONE AREAS

                  identification of flood-prone areas

  Sec. 1360. (a) The Administrator is authorized to consult 
with, receive information from, and enter into any agreements 
or other arrangements with the Secretaries of the Army, the 
Interior, Agriculture, and Commerce, the Tennessee Valley 
Authority, and the heads of other Federal departments or 
agencies, on a reimbursement basis, or with the head of any 
State or local agency, or enter into contracts with any persons 
or private firms, in order that he may--
          (1) identify and publish information with respect to 
        all flood plain areas, including coastal areas located 
        in the United States, which have special flood hazards, 
        within five years following the date of the enactment 
        of this Act, and
          (2) establish or update flood-risk zone data in all 
        such areas, and make estimates with respect to the 
        rates of probable flood caused loss for the various 
        flood risk zones for each of these areas until the date 
        specified in section 1319.
  (b) The Administrator is directed to accelerate the 
identification of risk zones within flood-prone and mudslide-
prone areas, as provided by subsection (a)(2) of this section, 
in order to make known the degree of hazard within each such 
zone at the earliest possible date. To accomplish this 
objective, the Administrator is authorized, without regard to 
subsections (a) and (b) of section 3324 of title 31, United 
States Code, and section 3709 of the Revised Statutes (41 
U.S.C. 5), to make grants, provide technical assistance, and 
enter into contracts, cooperative agreements, or other 
transactions, on such terms as he may deem appropriate, or 
consent to modifications thereof, and to make advance or 
progress payments in connection therewith.
  (c) The Secretary of Defense (through the Army Corps of 
Engineers), the Secretary of the Interior (through the United 
States Geological Survey), the Secretary of Agriculture 
(through the Soil Conservation Service), the Secretary of 
Commerce (through the National Oceanic and Atmospheric 
Administration), the head of the Tennessee Valley Authority, 
and the heads of all other Federal agencies engaged in the 
identification or delineation of flood-risk zones within the 
several States shall, in consultation with the Administrator, 
give the highest practicable priority in the allocation of 
available manpower and other available resources to the 
identification and mapping of flood hazard areas and flood-risk 
zones, in order to assist the Administrator to meet the 
deadline established by this section.
  (d) The Administrator shall, not later than September 30, 
1984, submit to the Congress a plan for bringing all 
communities containing flood-risk zones into full program 
status by September 30, 1987.
  (e) Review of Flood Maps.--Once during each 5-year period 
(the 1st such period beginning on the date of enactment of the 
Riegle Community Development and Regulatory Improvement Act of 
1994) or more often as the Administrator determines necessary, 
the Administrator shall assess the need to revise and update 
all floodplain areas and flood risk zones identified, 
delineated, or established under this section, based on an 
analysis of all natural hazards affecting flood risks.
  (f) Updating Flood Maps.--The Administrator shall revise and 
update any floodplain areas and flood-risk zones--
          (1) upon the determination of the Administrator, 
        according to the assessment under subsection (e), that 
        revision and updating are necessary for the areas and 
        zones; or
          (2) upon the request from any State or local 
        government stating that specific floodplain areas or 
        flood-risk zones in the State or locality need revision 
        or updating, if sufficient technical data justifying 
        the request is submitted and the unit of government 
        making the request agrees to provide funds in an amount 
        determined by the Administrator.
  (g) Availability of Flood Maps.--To promote compliance with 
the requirements of this title, the Administrator shall make 
flood insurance rate maps and related information available 
free of charge to the Federal entities for lending regulation, 
Federal agency lenders, State agencies directly responsible for 
coordinating the national flood insurance program, and 
appropriate representatives of communities participating in the 
national flood insurance program, and at a reasonable cost to 
all other persons. Any receipts resulting from this subsection 
shall be deposited in the National Flood Insurance Fund, 
pursuant to section 1310(b)(6).
  (h) Notification of Flood Map Changes.--The Administrator 
shall cause notice to be published in the Federal Register (or 
shall provide notice by another comparable method) of any 
change to flood insurance map panels and any change to flood 
insurance map panels issued in the form of a letter of map 
amendment or a letter of map revision. Such notice shall be 
published or otherwise provided not later than 30 days after 
the map change or revision becomes effective. Notice by any 
method other than publication in the Federal Register shall 
include all pertinent information, provide for regular and 
frequent distribution, and be at least as accessible to map 
users as notice in the Federal Register. All notices under this 
subsection shall include information on how to obtain copies of 
the changes or revisions.
  (i) Compendia of Flood Map Changes.--Every 6 months, the 
Administrator shall publish separately in their entirety within 
a compendium, all changes and revisions to flood insurance map 
panels and all letters of map amendment and letters of map 
revision for which notice was published in the Federal Register 
or otherwise provided during the preceding 6 months. The 
Administrator shall make such compendia available, free of 
charge, to Federal entities for lending regulation, Federal 
agency lenders, and States and communities participating in the 
national flood insurance program pursuant to section 1310 and 
at cost to all other parties. Any receipts resulting from this 
subsection shall be deposited in the National Flood Insurance 
Fund, pursuant to section 1310(b)(6).
  (j) Provision of Information.--In the implementation of 
revisions to and updates of flood insurance rate maps, the 
Administrator shall share information, to the extent 
appropriate, with the Under Secretary of Commerce for Oceans 
and Atmosphere and representatives from State coastal zone 
management programs.
  (k) Appeals of Existing Maps.--
          (1) Right to appeal.--Subject to paragraph (6), a 
        State or local government, or the owner or lessee of 
        real property, who has made a formal request to the 
        Administrator to update a flood map that the 
        Administrator has denied may at any time appeal such a 
        denial as provided in this subsection.
          (2) Basis for appeal.--The basis for appeal under 
        this subsection shall be the possession of knowledge or 
        information that--
                  (A) the base flood elevation level or 
                designation of any aspect of a flood map is 
                scientifically or technically inaccurate; or
                  (B) factors exist that mitigate the risk of 
                flooding, including ditches, banks, walls, 
                vegetation, levees, lakes, dams, reservoirs, 
                basin, retention ponds, and other natural or 
                manmade topographical features.
          (3) Appeals process.--
                  (A) Administrative adjudication.--An appeal 
                under this subsection shall be determined by a 
                final adjudication on the record, and after 
                opportunity for an administrative hearing.
                  (B) Rights upon adverse decision.--If an 
                appeal pursuant to subparagraph (A) does not 
                result in a decision in favor of the State, 
                local government, owner, or lessee, such party 
                may appeal the adverse decision to the 
                Scientific Resolution Panel provided for in 
                section 1363A, which shall recommend a non-
                binding decision to the Administrator.
          (4) Relief.--
                  (A) Wholly successful appeals.--In the case 
                of a successful appeal resulting in a 
                policyholder's property being removed from a 
                special flood hazard area, such policyholder 
                may cancel the policy at any time within the 
                current policy year, and the Administrator 
                shall provide such policyholder a refund in the 
                amount of any premiums paid for such policy 
                year, plus any premiums paid for flood 
                insurance coverage that the policyholder was 
                required to purchase or maintain during the 2-
                year period preceding such policy year.
                  (B) Partially successful appeals.--In the 
                case of any appeal in which mitigating factors 
                were determined to have reduced, but not 
                eliminated, the risk of flooding, the 
                Administrator shall reduce the amount of flood 
                insurance coverage required to be maintained 
                for the property concerned by the ratio of the 
                successful portion of the appeal as compared to 
                the entire appeal. The Administrator shall 
                refund to the policyholder any payments made in 
                excess of the amount necessary for such new 
                coverage amount, effective from the time when 
                the mitigating factor was created or the 
                beginning of the second policy year preceding 
                the determination of the appeal, whichever 
                occurred later.
                  (C) Additional relief.--The Administrator may 
                provide additional refunds in excess of the 
                amounts specified in subparagraphs (A) and (B) 
                if the Administrator determines that such 
                additional amounts are warranted.
          (5) Recovery of costs.--When, incident to any appeal 
        which is successful in whole or part regarding the 
        designation of the base flood elevation or any aspect 
        of the flood map, including elevation or designation of 
        a special flood hazard area, the community, or the 
        owner or lessee of real property, as the case may be, 
        incurs expense in connection with the appeal, including 
        services provided by surveyors, engineers, and 
        scientific experts, the Administrator shall reimburse 
        such individual or community for reasonable expenses to 
        an extent measured by the ratio of the successful 
        portion of the appeal as compared to the entire appeal, 
        but not including legal services, in the effecting of 
        an appeal based on a scientific or technical error on 
        the part of the Federal Emergency Management Agency. No 
        reimbursement shall be made by the Administrator in 
        respect to any fee or expense payment, the payment of 
        which was agreed to be contingent upon the result of 
        the appeal. The Administrator may use such amounts from 
        the National Flood Insurance Fund established under 
        section 1310 as may be necessary to carry out this 
        paragraph.
          (6) Inapplicability to community flood maps.--This 
        subsection shall not apply with respect to any flood 
        map that is in effect pursuant to certification under 
        the standards, guidelines, and procedures established 
        pursuant to section 100215(m)(1)(B) of the Biggert-
        Waters Flood Insurance Reform Act of 2012 (42 U.S.C. 
        4101a(m)(1)(B)).
          (7) Guidance.--The Administrator shall issue guidance 
        to implement this subsection, which shall not be 
        subject to the notice and comment requirements under 
        section 553 of title 5, United States Code.

           *       *       *       *       *       *       *


                                appeals

  Sec. 1363. (a) In establishing projected flood elevations and 
designating areas having special flood hazards for land use 
purposes with respect to any community pursuant to section 
1361, the Administrator shall first propose such determinations 
and designations by publication for comment [in the Federal 
Register], by direct notification to the chief executive 
officer of the community, and by publication in a prominent 
local newspaper.
  (b) The Administrator shall publish notification of flood 
elevation determinations and designations of areas having 
special flood hazards in a prominent local newspaper at least 
twice during the ten-day period following notification to the 
local government. [During the ninety-day period following the 
second publication, any owner or lessee of real property within 
the community who believes his property rights to be adversely 
affected by the Administrator's proposed determination may 
appeal such determination to the local government.] Any owner 
or lessee of real property within the community who believes 
the owner's or lessee's rights to be adversely affected by the 
Administrator's proposed determination may appeal such 
determination to the local government no later than 90 days 
after the date of the second publication. The sole grounds for 
appeal shall be the possession of knowledge or information 
indicating that (1) the elevations being proposed by the 
Administrator with respect to an identified area having special 
flood hazards are scientifically or technically incorrect, or 
(2) the designation of an identified special flood hazard area 
is scientifically or technically incorrect.
  (c) Appeals by private persons shall be made to the chief 
executive officer of the community, or to such agency as he 
shall publicly designate, and shall set forth the data that 
tend to negate or contradict the Administrator's finding in 
such form as the chief executive officer may specify. The 
community shall review and consolidate all such appeals and 
issue a written opinion stating whether the evidence presented 
is sufficient to justify an appeal on behalf of such persions 
by the community in its own name. Whether or not the community 
decides to appeal the Administrator's determination, copies of 
individual appeals shall be sent to the Administrator as they 
are received by the community, and the community's appeal or a 
copy of its decision not to appeal shall be filed with the 
Administrator not later than ninety days after the date of the 
second newspaper publication of the Administrator's 
notification.
  (d) In the event the Administrator does not receive an appeal 
from the community within the ninety days provided he shall 
consolidate and review on their own merits, in accordance with 
the procedures set forth in [subsection (e)] subsection (f) , 
the appeals filed within the community by private persons and 
shall make such modifications of his proposed determinations as 
may be appropriate, taking into account the written opinion, if 
any, issued by the community in not supporting such appeals. 
The Administrator's decision shall be in written form, and 
copies thereof shall be sent both to the chief executive 
officer of the community and to each individual appellant.
  (e) Determination by Administrator in the Absence of 
Appeals.--If the Administrator has not received any appeals, 
upon expiration of the 90-day appeal period established under 
subsection (b) of this section the Administrator's proposed 
determination shall become final. The community shall be given 
a reasonable time after the Administrator's final determination 
in which to adopt local land use and control measures 
consistent with the Administrator's determination.
  [(e)] (f) Upon appeal by any community, as provided by this 
section, the Administrator shall review and take fully into 
account any technical or scientific data submitted by the 
community that tend to negate or contradict the information 
upon which his proposed determination is based. The 
Administrator shall resolve such appeal by consultation with 
officials of the local government involved, by administrative 
hearing, or by submission of the conflicting data to the 
Scientific Resolution Panel provided for in section 1363A. 
Until the conflict in data is resolved, and the Administrator 
makes a final determination on the basis of his findings in the 
Federal Register, and so notifies the governing body of the 
community, flood insurance previously available within the 
community shall continue to be available, and no person shall 
be denied the right to purchase such insurance at chargeable 
rates. The Administrator shall make his determination within a 
reasonable time. The community shall be given a reasonable time 
after the Administrator's final determination in which to adopt 
local land use and control measures consistent with the 
Administrator's determination. The reports and other 
information used by the Administrator in making his final 
determination shall be made available for public inspection and 
shall be admissible in a court of law in the event the 
community seeks judicial review as provided by this section.
  [(f)] (g) Reimbursement of Certain Expenses.--When, incident 
to any appeal under subsection (b) or (c) of this section, the 
owner or lessee of real property or the community, as the case 
may be, or, in the case of an appeal that is resolved by 
submission of conflicting data to the Scientific Resolution 
Panel provided for in section 1363A, the community, incurs 
expense in connection with the services of surveyors, 
engineers, or similar services, but not including legal 
services, in the effecting of an appeal based on a scientific 
or technical error on the part of the Federal Emergency 
Management Agency, which is successful in whole or part, the 
Administrator shall reimburse such individual or community to 
an extent measured by the ratio of the successful portion of 
the appeal as compared to the entire appeal and applying such 
ratio to the reasonable value of all such services, but no 
reimbursement shall be made by the Administrator in respect to 
any fee or expense payment, the payment of which was agreed to 
be contingent upon the result of the appeal. The Administrator 
may use such amounts from the National Flood Insurance Fund 
established under section 1310 as may be necessary to carry out 
this subsection. The Administrator shall promulgate regulations 
to carry out this subsection.
  [(g)] (h) Except as provided in section 1363A, any appellant 
aggrieved by any final determination of the Administrator upon 
administrative appeal, as provided by this section, may appeal 
such determination to the United States district court for the 
district within which the community is located not more than 
sixty days after receipt of notice of such determination. The 
scope of review by the court shall be as provided by chapter 7 
of title 5, United States Code. During the pendency of any such 
litigation, all final determinations of the Administrator shall 
be effective for the purposes of this title unless stayed by 
the court for good cause shown.
  (i) Inapplicability to Community Flood Maps.--This section 
shall not apply with respect to any flood map that is in effect 
pursuant to certification under the standards, guidelines, and 
procedures established pursuant to section 100215(m)(1) of the 
Biggert-Waters Flood Insurance Reform Act of 2012 (42 U.S.C. 
4101a(m)(1)), which shall include procedures for providing 
notification and appeal rights to individuals within the 
communities of the proposed flood elevation determinations.

           *       *       *       *       *       *       *


                         mitigation assistance

  Sec. 1366. (a) Authority.--The Administrator shall carry out 
a program to provide financial assistance to States and 
communities, using amounts made available from the National 
Flood Mitigation Fund under section 1367, for planning and 
carrying out activities designed to reduce the risk of flood 
damage to structures covered under contracts for flood 
insurance under this title. Priority under the program shall be 
given to providing assistance with respect to multiple-loss 
properties. Such financial assistance shall be made available--
           (1) to States and communities in the form of grants 
        under this section for carrying out mitigation 
        activities; and
          [(2) to States and communities in the form of grants 
        under this section for carrying out mitigation 
        activities that reduce flood damage to severe 
        repetitive loss structures; and
          [(3) to property owners in the form of direct grants 
        under this section for carrying out mitigation 
        activities that reduce flood damage to individual 
        structures for which 2 or more claim payments for 
        losses have been made under flood insurance coverage 
        under this title if the Administrator, after 
        consultation with the State and community, determines 
        that neither the State nor community in which such a 
        structure is located has the capacity to manage such 
        grants.]
          (2) to property owners, in coordination with the 
        State and community, in the form of direct grants under 
        this section for carrying out mitigation activities 
        that reduce flood damage to extreme repetitive-loss 
        properties.
The Administrator shall take such actions as may be necessary 
to ensure that grants under this subsection are provided in a 
manner that is consistent with the delivery of coverage for 
increased cost of compliance provided under section 1304(b).
  (b) Eligibility for Mitigation Assistance.--To be eligible to 
receive financial assistance under this section for mitigation 
activities, a State or community shall develop, and have 
approved by the Administrator, a flood risk mitigation plan (in 
this section referred to as a ``mitigation plan''), that 
describes the mitigation activities to be carried out with 
assistance provided under this section, is consistent with the 
criteria established by the Administrator under section 1361, 
provides for reduction of flood losses to structures for which 
contracts for flood insurance are available under this title, 
and may be included in a multihazard mitigation plan. The 
mitigation plan shall be consistent with a comprehensive 
strategy for mitigation activities for the area affected by the 
mitigation plan, that has been adopted by the State or 
community following a public hearing.
  (c) Eligible Mitigation Activities.--
          (1) Requirement of Consistency With Approved 
        Mitigation Plan.--Amounts provided under this section 
        may be used only for mitigation activities that are 
        consistent with mitigation plans that are approved by 
        the Administrator and identified under paragraph (4). 
        The Administrator shall provide assistance under this 
        section to the extent amounts are available in the 
        National Flood Mitigation Fund pursuant to 
        appropriation Acts, subject only to the absence of 
        approvable mitigation plans.
          (2) Requirements of technical feasibility, cost 
        effectiveness, and interest of national flood insurance 
        fund.--
                  (A) In general.--The Administrator may 
                approve only mitigation activities that the 
                Administrator determines--
                          (i) are technically feasible and 
                        cost-effective; or
                          (ii) will eliminate future payments 
                        from the National Flood Insurance Fund 
                        for [severe repetitive loss structures] 
                        multiple-loss properties through an 
                        acquisition or relocation activity.
                  (B) Considerations.--In making a 
                determination under subparagraph (A), the 
                Administrator shall take into consideration 
                recognized ancillary benefits.
          (3) Eligible activities.--Eligible activities under a 
        mitigation plan may include--
                  (A) demolition or relocation of any structure 
                located on land that is along the shore of a 
                lake or other body of water and is certified by 
                an appropriate State or local land use 
                authority to be subject to imminent collapse or 
                subsidence as a result of erosion or flooding;
                  (B) elevation, relocation, demolition, or 
                floodproofing of structures (including public 
                structures) located in areas having special 
                flood hazards or other areas of flood risk;
                  (C) acquisition by States and communities of 
                properties (including public properties) 
                located in areas having special flood hazards 
                or other areas of flood risk and properties 
                substantially damaged by flood, for public use, 
                as the Administrator determines is consistent 
                with sound land management and use in such 
                area;
                  (D) elevation, relocation, or floodproofing 
                of utilities (including equipment that serves 
                structures);
                  (E) minor physical mitigation efforts that do 
                not duplicate the flood prevention activities 
                of other Federal agencies and that lessen the 
                frequency or severity of flooding and decrease 
                predicted flood damages, which shall not 
                include major flood control projects such as 
                dikes, levees, seawalls, groins, and jetties 
                unless the Administrator specifically 
                determines in approving a mitigation plan that 
                such activities are the most cost-effective 
                mitigation activities for the National Flood 
                Mitigation Fund;
                  (F) the development or update of mitigation 
                plans by a State or community which meet the 
                planning criteria established by the 
                Administrator, except that the amount from 
                grants under this section that may be used 
                under this subparagraph may not exceed $50,000 
                for any mitigation plan of a State or $25,000 
                for any mitigation plan of a community;
                  (G) the provision of technical assistance by 
                States to communities and individuals to 
                conduct eligible mitigation activities;
                  (H) other activities that the Administrator 
                considers appropriate and specifies in 
                regulation;
                  (I) other mitigation activities not described 
                in subparagraphs (A) through (G) or the 
                regulations issued under subparagraph (H), that 
                are described in the mitigation plan of a State 
                or community; and
                  (J) without regard to the requirements under 
                paragraphs (1) and (2) of subsection (d), and 
                if the State applied for and was awarded at 
                least $1,000,000 in grants available under this 
                section in the prior fiscal year, technical 
                assistance to communities to identify eligible 
                activities, to develop grant applications, and 
                to implement grants awarded under this section, 
                not to exceed $50,000 to any 1 State in any 
                fiscal year.
          (4) Eligibility of demolition and rebuilding of 
        properties.--The Administrator shall consider as an 
        eligible activity the demolition and rebuilding of 
        properties to at least base flood elevation or greater, 
        if required by the Administrator or if required by any 
        State regulation or local ordinance, and in accordance 
        with criteria established by the Administrator.
  (d) Matching Requirement.--The Administrator may provide 
grants for eligible mitigation activities as follows:
           (1)  [Severe repetitive loss structures] Extreme 
        repetitive-loss properties.--In the case of mitigation 
        activities to [severe repetitive loss structures] 
        extreme repetitive-loss properties , in an amount up 
        to--
                  (A) 100 percent of all eligible costs, if the 
                activities are approved under subsection 
                (c)(2)(A)(i); or
                  (A) the expected savings to the National 
                Flood Insurance Fund from expected avoided 
                damages through acquisition or relocation 
                activities, if the activities are approved 
                under subsection (c)(2)(A)(ii).
          (2)  [Repetitive loss structures] Severe repetitive-
        loss properties.--In the case of mitigation activities 
        to [repetitive loss structures] severe repetitive-loss 
        properties , in an amount up to [90 percent] 100 
        percent of all eligible costs.
          (3) Repetitive-loss property.--In the case of 
        mitigation activities to repetitive-loss properties, in 
        an amount up to 100 percent of all eligible costs.
          [(3)] (4) Other mitigation activities.--In the case 
        of all other mitigation activities, in an amount up to 
        75 percent of all eligible costs
  (e) Recapture.--
  (1) Noncompliance With Plan.--If the Administrator determines 
that a State or community that has received mitigation 
assistance under this section has not carried out the 
mitigation activities as set forth in the mitigation plan, the 
Administrator shall recapture any unexpended amounts and 
deposit the amounts in the National Flood Mitigation Fund under 
section 1367.
          (2) Failure to provide matching funds.--If the 
        Administrator determines that a State or community that 
        has received mitigation assistance under this section 
        has not provided matching funds in the amount required 
        under subsection (d), the Administrator shall recapture 
        any unexpended amounts of mitigation assistance 
        exceeding the amount of such matching funds actually 
        provided and deposit the amounts in the National Flood 
        Mitigation Fund under section 1367.
  (f) Reports.--Not later than 1 year after the date of 
enactment of the Biggert-Waters Flood Insurance Reform Act of 
2012 and biennially thereafter, the Administrator shall submit 
a report to the Congress describing the status of mitigation 
activities carried out with assistance provided under this 
section.
  (g) Failure To Make Grant Award Within 5 Years.--For any 
application for a grant under this section for which the 
Administrator fails to make a grant award within 5 years of the 
date of the application, the grant application shall be 
considered to be denied and any funding amounts allocated for 
such grant applications shall remain in the National Flood 
Mitigation Fund under section 1367 of this title and shall be 
made available for grants under this section.
  (h) Alignment With Increased Cost of Compliance.--
Notwithstanding any provision of law, any funds appropriated 
for assistance under this title may be transferred to the 
National Flood Insurance Fund established under section 1310 
(42 U.S.C. 4017) for the payment of claims to enable the 
Administrator to deliver grants under subsection (a)(2) of this 
section to align with the delivery of coverage for increased 
cost of compliance for extreme repetitive-loss properties.
  (i) Funding.--
          (1) Authorization of appropriations.--Notwithstanding 
        any other provision of law, assistance provided under 
        this section shall be funded by--
                  (A) $225,000,000 in each fiscal year, subject 
                to offsetting collections, through risk premium 
                rates for flood insurance coverage under this 
                title, and shall be available subject to 
                section 1310(f);
                  (B) any penalties collected under section 
                102(f) the Flood Disaster Protect Act of 1973 
                (42 U.S.C. 4012a(f); and
                  (C) any amounts recaptured under subsection 
                (e) of this section.
        The Administrator may not use more than 5 percent of 
        amounts made available under this subsection to cover 
        salaries, expenses, and other administrative costs 
        incurred by the Administrator to make grants and 
        provide assistance under this section.
          (2) Availability.--Amounts appropriated pursuant to 
        this subsection for any fiscal year may remain 
        available for obligation until expended.
  [(h) Definitions.--For purposes of this section, the 
following definitions shall apply:]
  [(1) Community.--The] (j) Definition of Community._For 
purposes of this section, the term ``community'' means--
          [(A)] (1) a political subdivision that--
                  [(i)] (A) has zoning and building code 
                jurisdiction over a particular area having 
                special flood hazards; and
                  [(ii)] (B) is participating in the national 
                flood insurance program; or
          [(B)] (2) a political subdivision of a State, or 
        other authority, that is designated by political 
        subdivisions, all of which meet the requirements of 
        [subparagraph (A)] paragraph (1) , to administer grants 
        for mitigation activities for such political 
        subdivisions.
          [(2) Repetitive loss structure.--The term 
        ``repetitive loss structure'' has the meaning given 
        such term in section 1370.
          [(3) Severe repetitive loss structure.--The term 
        ``severe repetitive loss structure'' means a structure 
        that--
                  [(A) is covered under a contract for flood 
                insurance made available under this title; and
                  [(B) has incurred flood-related damage--
                          [(i) for which 4 or more separate 
                        claims payments have been made under 
                        flood insurance coverage under this 
                        title, with the amount of each such 
                        claim exceeding $5,000, and with the 
                        cumulative amount of such claims 
                        payments exceeding $20,000; or
                          [(ii) for which at least 2 separate 
                        claims payments have been made under 
                        such coverage, with the cumulative 
                        amount of such claims exceeding the 
                        value of the insured structure.]

                    [national flood mitigation fund

  [Sec. 1367. (a) Establishment and Availability.--The 
Administrator shall establish in the Treasury of the United 
States a fund to be known as the National Flood Mitigation 
Fund, which shall be credited with amounts described in 
subsection (b) and shall be available, to the extent provided 
in appropriation Acts, for providing assistance under section 
1366.
  [(b) Credits.--The National Flood Mitigation Fund shall be 
credited with--
          [(1) in each fiscal year, amounts from the National 
        Flood Insurance Fund not to exceed $90,000,000 and to 
        remain available until expended, of which--
                  [(A) not more than $40,000,000 shall be 
                available pursuant to subsection (a) of this 
                section for assistance described in section 
                1366(a)(1);
                  [(B) not more than $40,000,000 shall be 
                available pursuant to subsection (a) of this 
                section for assistance described in section 
                1366(a)(2); and
                  [(C) not more than $10,000,000 shall be 
                available pursuant to subsection (a) of this 
                section for assistance described in section 
                1366(a)(3);
          [(2) any penalties collected under section 102(f) of 
        the Flood Disaster Protection Act of 1973; and
          [(3) any amounts recaptured under section 1366(e).
  [(c) Administrative Expenses.--The Administrator may use not 
more than 5 percent of amounts made available under subsection 
(b) to cover salaries, expenses, and other administrative costs 
incurred by the Administrator to make grants and provide 
assistance under section 1366.
  [(d) Prohibition on Offsetting Collections.--Notwithstanding 
any other provision of this title, amounts made available 
pursuant to this section shall not be subject to offsetting 
collections through premium rates for flood insurance coverage 
under this title.
  [(e) Continued Availability and Reallocation.--Any amounts 
made available pursuant to subparagraph (A), (B), or (C) of 
subsection (b)(1) that are not used in any fiscal year shall 
continue to be available for the purposes specified in the 
subparagraph of subsection (b)(1) pursuant to which such 
amounts were made available, unless the Administrator 
determines that reallocation of such unused amounts to meet 
demonstrated need for other mitigation activities under section 
1366 is in the best interest of the National Flood Insurance 
Fund.
  [(f) Investment.--If the Administrator determines that the 
amounts in the National Flood Mitigation Fund are in excess of 
amounts needed under subsection (a), the Administrator may 
invest any excess amounts the Administrator determines 
advisable in interest-bearing obligations issued or guaranteed 
by the United States.
  [(g) Report.--The Administrator shall submit a report to the 
Congress not later than the expiration of the 1-year period 
beginning on the date of enactment of this Act and not less 
than once during each successive 2-year period thereafter. The 
report shall describe the status of the Fund and any activities 
carried out with amounts from the Fund.]

        CHAPTER IV--APPROPRIATIONS AND MISCELLANEOUS PROVISIONS

                              definitions

  Sec. 1370. (a) As used in this title--
          (1) the term ``flood'' shall have such meaning as may 
        be prescribed in regulations of the Administrator, and 
        may include inundation from rising waters or from the 
        overflow of streams, rivers, or other bodies of water, 
        or from tidal surges, abnormally high tidal water, 
        tidal waves, tsunamis, hurricanes, or other severe 
        storms or deluge;
          (2) the terms ``United States'' (when used in a 
        geographic sense) and ``State'' includes the several 
        States, the District of Columbia, the territories and 
        possessions, the Commonwealth of Puerto Rico, and the 
        Trust Territory of the Pacific Islands;
          (3) the terms ``insurance company'', ``other 
        insurer'' and ``insurance agent or broker'' include any 
        organization or person that is authorized to engage in 
        the business of insurance under the laws of any State, 
        subject to the reporting requirements of the Securities 
        Exchange Act of 1934 pursuant to section 13(a) or 15(d) 
        of such Act (15 U.S.C. 78m(a) and 78o(d)), or 
        authorized by the Administrator to assume reinsurance 
        on risks insured by the flood insurance program;
          (4) the term ``insurance adjustment organization'' 
        includes any organizations and persons engaged in the 
        business of adjusting loss claims arising under 
        insurance policies issued by any insurance company or 
        other insurer;
          (5) the term ``person'' includes any individual or 
        group of individuals, corporation, partnership, 
        association, or any other organized group of persons, 
        including State and local governments and agencies 
        thereof;
          (6) the term ``Administrator'' means the 
        Administrator of the Federal Emergency Management 
        Agency;
          [(7) the term ``repetitive loss structure'' means a 
        structure covered by a contract for flood insurance 
        that--
                  [(A) has incurred flood-related damage on 2 
                occasions, in which the cost of repair, on the 
                average, equaled or exceeded 25 percent of the 
                value of the structure at the time of each such 
                flood event; and
                  [(B) at the time of the second incidence of 
                flood-related damage, the contract for flood 
                insurance contains increased cost of compliance 
                coverage.]
          [(8)] (7) the term ``Federal agency lender'' means a 
        Federal agency that makes direct loans secured by 
        improved real estate or a mobile home, to the extent 
        such agency acts in such capacity;
          [(9)] (8) the term ``Federal entity for lending 
        regulation'' means the Board of Governors of the 
        Federal Reserve System, the Federal Deposit Insurance 
        Corporation, the Comptroller of the Currency, the 
        National Credit Union Administration, and the Farm 
        Credit Administration, and with respect to a particular 
        regulated lending institution means the entity 
        primarily responsible for the supervision of the 
        institution;
          [(10)] (9) the term ``improved real estate'' means 
        real estate upon which a building is located;
          [(11)] (10) the term ``lender'' means a regulated 
        lending institution or Federal agency lender;
          [(12)] (11) the term ``natural and beneficial 
        floodplain functions'' means--
                  (A) the functions associated with the natural 
                or relatively undisturbed floodplain that (i) 
                moderate flooding, retain flood waters, reduce 
                erosion and sedimentation, and mitigate the 
                effect of waves and storm surge from storms, 
                and (ii) reduce flood related damage; and
                  (B) ancillary beneficial functions, including 
                maintenance of water quality and recharge of 
                ground water, that reduce flood related damage;
          [(13)] (12) the term ``regulated lending 
        institution'' means any bank, savings and loan 
        association, credit union, farm credit bank, Federal 
        land bank association, production credit association, 
        or similar institution subject to the supervision of a 
        Federal entity for lending regulation;
          [(14)] (13) the term ``servicer'' means the person 
        responsible for receiving any scheduled periodic 
        payments from a borrower pursuant to the terms of a 
        loan, including amounts for taxes, insurance premiums, 
        and other charges with respect to the property securing 
        the loan, and making the payments of principal and 
        interest and such other payments with respect to the 
        amounts received from the borrower as may be required 
        pursuant to the terms of the loan; and
          [(15)] (14) the term ``substantially damaged 
        structure'' means a structure covered by a contract for 
        flood insurance that has incurred damage for which the 
        cost of repair exceeds an amount specified in any 
        regulation promulgated by the Administrator, or by a 
        community ordinance, whichever is lower.
  (b) The term ``flood'' shall also include inundation from 
mudslides which are proximately caused by accumulations of 
water on or under the ground; and all of the provisions of this 
title shall apply with respect to such mudslides in the same 
manner and to the same extent as with respect to floods 
described in subsection (a)(1), subject to and in accordance 
with such regulations, modifying the provisions of this title 
(including the provisions relating to land management and use) 
to the extent necessary to insure that they can be effectively 
so applied, as the Administrator may prescribe to achieve (with 
respect to such mudslides) the purposes of this title and the 
objectives of the program.
  (c) The term ``flood'' shall also include the collapse or 
subsidence of land along the shore of a lake or other body of 
water as a result of erosion or undermining caused by waves or 
currents of water exceeding anticipated cyclical levels, and 
all of the provisions of this title shall apply with respect to 
such collapse or subsidence in the same manner and to the same 
extent as with respect to floods described in subsection 
(a)(1), subject to and in accordance with such regulations, 
modifying the provisions of this title (including the 
provisions relating to land management and use) to the extent 
necessary to insure that they can be effectively so applied, as 
the Administrator may prescribe to achieve (with respect to 
such collapse or subsidence) the purposes of this title and the 
objectives of the program.
  (d) Multiple-Loss Properties.--
          (1) Definitions.--As used in this title:
                  (A) Multiple-loss property.--The term 
                ``multiple-loss property'' means any property 
                that is a repetitive-loss property, a severe 
                repetitive-loss property, or an extreme 
                repetitive-loss property.
                  (B) Repetitive-loss property.--The term 
                ``repetitive-loss property'' means a structure 
                that has incurred flood damage for which two or 
                more separate claims payments of any amount 
                have been made under flood insurance coverage 
                under this title.
                  (C) Severe repetitive-loss property.--The 
                term ``severe repetitive-loss property'' means 
                a structure that has incurred flood damage for 
                which--
                          (i) 4 or more separate claims 
                        payments have been made under flood 
                        insurance coverage under this title, 
                        with the amount of each such claim 
                        exceeding $5,000, and with the 
                        cumulative amount of such claims 
                        payments exceeding $20,000; or
                          (ii) at least 2 separate claims 
                        payments have been made under flood 
                        insurance coverage under this title, 
                        with the cumulative amount of such 
                        claims payments exceeding the value of 
                        the structure.
                  (D) Extreme repetitive-loss property.--The 
                term ``extreme repetitive-loss property'' means 
                a structure that has incurred flood damage for 
                which at least 2 separate claims have been made 
                under flood insurance coverage under this 
                title, with the cumulative amount of such 
                claims payments exceeding 150 percent of the 
                maximum coverage amount available for the 
                structure.
          (2) Treatment of claims before compliance with state 
        and local requirements.--The Administrator shall not 
        consider claims that occurred before a structure was 
        made compliant with State and local floodplain 
        management requirements for purposes of determining a 
        structure's status as a multiple-loss property.

           *       *       *       *       *       *       *

                              ----------                              


                 FLOOD DISASTER PROTECTION ACT OF 1973



           *       *       *       *       *       *       *
TITLE I--EXPANSION OF NATIONAL FLOOD INSURANCE PROGRAM

           *       *       *       *       *       *       *


    flood insurance purchase and compliance requirements and escrow 
                                accounts

  Sec. 102. (a) [After] Subject to subsection (i) of this 
section, after the expiration of sixty days following the date 
of enactment of this Act, no Federal officer or agency shall 
approve any financial assistance for acquisition or 
construction purposes for use in any area that has been 
identified by the Administrator as an area having special flood 
hazards and in which the sale of flood insurance has been made 
available under the National Flood Insurance Act of 1968, 
unless the building or mobile home and any personal property to 
which such financial assistance relates is covered by flood 
insurance in an amount at least equal to its development or 
project cost (less estimated land cost) or to the maximum limit 
of coverage made available with respect to the particular type 
of property under the National Flood Insurance Act of 1968, 
whichever is less: Provided, That if the financial assistance 
provided is in the form of a loan or an insurance or guaranty 
of a loan, the amount of flood insurance required need not 
exceed the outstanding principal balance of the loan and need 
not be required beyond the term of the loan. The requirement of 
maintaining flood insurance shall apply during the life of the 
property, regardless of transfer of ownership of such property.
  (b) Requirement for Mortgage Loans.--
          (1) Regulated lending institutions.-- [Each] Subject 
        to subsection (i) of this section, each Federal entity 
        for lending regulation (after consultation and 
        coordination with the Financial Institutions 
        Examination Council established under the Federal 
        Financial Institutions Examination Council Act of 1974) 
        shall by regulation direct regulated lending 
        institutions--
                  (A) not to make, increase, extend, or renew 
                any loan secured by improved real estate or a 
                mobile home located or to be located in an area 
                that has been identified by the Administrator 
                as an area having special flood hazards and in 
                which flood insurance has been made available 
                under the National Flood Insurance Act of 1968, 
                unless the building or mobile home and any 
                personal property securing such loan is covered 
                for the term of the loan by flood insurance in 
                an amount at least equal to the outstanding 
                principal balance of the loan or the maximum 
                limit of coverage made available under the Act 
                with respect to the particular type of 
                property, whichever is less; and
                  (B) to accept private flood insurance as 
                satisfaction of the flood insurance coverage 
                requirement under subparagraph (A) if the 
                coverage provided by such private flood 
                insurance meets the requirements for coverage 
                under such subparagraph.
          (2) Federal agency lenders.--A Federal agency lender 
        may not make, increase, extend, or renew any loan 
        secured by improved real estate or a mobile home 
        located or to be located in an area that has been 
        identified by the Administrator as an area having 
        special flood hazards and in which flood insurance has 
        been made available under the National Flood Insurance 
        Act of 1968, unless the building or mobile home and any 
        personal property securing such loan is covered for the 
        term of the loan by flood insurance in the amount 
        provided in paragraph (1)(A). [Each] Subject to 
        subsection (i) of this section, A Federal agency lender 
        shall accept private flood insurance as satisfaction of 
        the flood insurance coverage requirement under the 
        preceding sentence if the flood insurance coverage 
        provided by such private flood insurance meets the 
        requirements for coverage under such sentence. Each 
        Federal agency lender shall issue any regulations 
        necessary to carry out this paragraph. Such regulations 
        shall be consistent with and substantially identical to 
        the regulations issued under paragraph (1)(A).
          (3) Government-sponsored enterprises for housing.--
        [The] Subject to subsection (i) of this section, the 
        Federal National Mortgage Association and the Federal 
        Home Loan Mortgage Corporation shall implement 
        procedures reasonably designed to ensure that, for any 
        loan that is--
                  (A) secured by improved real estate or a 
                mobile home located in an area that has been 
                identified, at the time of the origination of 
                the loan or at any time during the term of the 
                loan, by the Administrator as an area having 
                special flood hazards and in which flood 
                insurance is available under the National Flood 
                Insurance Act of 1968, and
                  (B) purchased by such entity,
        the building or mobile home and any personal property 
        securing the loan is covered for the term of the loan 
        by flood insurance in the amount provided in paragraph 
        (1)(A). The Federal National Mortgage Association and 
        the Federal Home Loan Mortgage Corporation shall accept 
        private flood insurance as satisfaction of the flood 
        insurance coverage requirement under paragraph (1)(A) 
        if the flood insurance coverage provided by such 
        private flood insurance meets the requirements for 
        coverage under such paragraph and any requirements 
        established by the Federal National Mortgage 
        Association or the Federal Home Loan Mortgage 
        Corporation, respectively, relating to the financial 
        solvency, strength, or claims-paying ability of private 
        insurance companies from which the Federal National 
        Mortgage Association or the Federal Home Loan Mortgage 
        Corporation will accept private flood insurance.
          (4) Applicability.--
                  (A) Existing coverage.--Except as provided in 
                subparagraph (B), paragraph (1) shall apply on 
                the date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994.
                  (B) New coverage.--Paragraphs (2) and (3) 
                shall apply only with respect to any loan made, 
                increased, extended, or renewed after the 
                expiration of the 1-year period beginning on 
                the date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994. Paragraph (1) shall apply with respect to 
                any loan made, increased, extended, or renewed 
                by any lender supervised by the Farm Credit 
                Administration only after the expiration of the 
                period under this subparagraph.
                  (C) Continued effect of regulations.--
                Notwithstanding any other provision of this 
                subsection, the regulations to carry out 
                paragraph (1), as in effect immediately before 
                the date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994, shall continue to apply until the 
                regulations issued to carry out paragraph (1) 
                as amended by section 522(a) of such Act take 
                effect.
          (5) Rule of construction.--Nothing in this subsection 
        shall be construed to supersede or limit the authority 
        of a Federal entity for lending regulation, the Federal 
        Housing Finance Agency, a Federal agency lender, the 
        Federal National Mortgage Association, or the Federal 
        Home Loan Mortgage Corporation to establish 
        requirements relating to the financial solvency, 
        strength, or claims-paying ability of private insurance 
        companies from which the entity or agency will accept 
        private flood insurance.
          (6) Notice.--
                  (A) In general.--Each lender shall disclose 
                to a borrower that is subject to this 
                subsection that--
                          (i) flood insurance is available from 
                        private insurance companies that issue 
                        standard flood insurance policies on 
                        behalf of the national flood insurance 
                        program or directly from the national 
                        flood insurance program;
                          (ii) flood insurance that provides 
                        the same level of coverage as a 
                        standard flood insurance policy under 
                        the national flood insurance program 
                        may be available from a private 
                        insurance company that issues policies 
                        on behalf of the company; and
                          (iii) the borrower is encouraged to 
                        compare the flood insurance coverage, 
                        deductibles, exclusions, conditions and 
                        premiums associated with flood 
                        insurance policies issued on behalf of 
                        the national flood insurance program 
                        and policies issued on behalf of 
                        private insurance companies and to 
                        direct inquiries regarding the 
                        availability, cost, and comparisons of 
                        flood insurance coverage to an 
                        insurance agent.
                  (B) Rule of construction.--Nothing in this 
                paragraph shall be construed as affecting or 
                otherwise limiting the authority of a Federal 
                entity for lending regulation to approve any 
                disclosure made by a regulated lending 
                institution for purposes of complying with 
                subparagraph (A).
          [(7) Private flood insurance defined.--In this 
        subsection, the term ``private flood insurance'' means 
        an insurance policy that--
                  [(A) is issued by an insurance company that 
                is--
                          [(i) licensed, admitted, or otherwise 
                        approved to engage in the business of 
                        insurance in the State or jurisdiction 
                        in which the insured building is 
                        located, by the insurance regulator of 
                        that State or jurisdiction; or
                          [(ii) in the case of a policy of 
                        difference in conditions, multiple 
                        peril, all risk, or other blanket 
                        coverage insuring nonresidential 
                        commercial property, is recognized, or 
                        not disapproved, as a surplus lines 
                        insurer by the insurance regulator of 
                        the State or jurisdiction where the 
                        property to be insured is located;
                  [(B) provides flood insurance coverage which 
                is at least as broad as the coverage provided 
                under a standard flood insurance policy under 
                the national flood insurance program, including 
                when considering deductibles, exclusions, and 
                conditions offered by the insurer;
                  [(C) includes--
                          [(i) a requirement for the insurer to 
                        give 45 days' written notice of 
                        cancellation or non-renewal of flood 
                        insurance coverage to--
                                  [(I) the insured; and
                                  [(II) the regulated lending 
                                institution or Federal agency 
                                lender;
                          [(ii) information about the 
                        availability of flood insurance 
                        coverage under the national flood 
                        insurance program;
                          [(iii) a mortgage interest clause 
                        similar to the clause contained in a 
                        standard flood insurance policy under 
                        the national flood insurance program; 
                        and
                          [(iv) a provision requiring an 
                        insured to file suit not later than 1 
                        year after date of a written denial of 
                        all or part of a claim under the 
                        policy; and
                  [(D) contains cancellation provisions that 
                are as restrictive as the provisions contained 
                in a standard flood insurance policy under the 
                national flood insurance program.]
          (7) Definitions.--In this section:
                  (A) Federal flood insurance.--The term 
                ``Federal flood insurance'' means an insurance 
                policy made available under the National Flood 
                Insurance Act of 1968 (42 U.S.C. 4001 et seq.).
                  (B) Flood insurance.--The term ``flood 
                insurance'' means--
                          (i) Federal flood insurance; and
                          (ii) private flood insurance.
                  (C) Mutual aid society.--The term ``mutual 
                aid society'' means an organization--
                          (i) the members of which--
                                  (I) share a common set of 
                                ethical or religious beliefs; 
                                and
                                  (II) in accordance with the 
                                beliefs described in subclause 
                                (I), agree to cover expenses 
                                arising from damage to property 
                                of the members of the 
                                organization, including damage 
                                caused by flooding; and
                          (ii) that has a demonstrated history 
                        of fulfilling the terms of agreements 
                        to cover expenses arising from damage 
                        to property of the members of the 
                        organization caused by flooding.
                  (D) Private flood insurance.--The term 
                ``private flood insurance'' means--
                          (i) an insurance policy that--
                                  (I) is issued by an insurance 
                                company that is--
                                          (aa) licensed, 
                                        admitted, or otherwise 
                                        approved to engage in 
                                        the business of 
                                        insurance in the State 
                                        in which the insured 
                                        building is located, by 
                                        the insurance regulator 
                                        of that State; or
                                          (bb) eligible as a 
                                        nonadmitted insurer to 
                                        provide insurance in 
                                        the home State of the 
                                        insured, in accordance 
                                        with sections 521 
                                        through 527 of the 
                                        Nonadmitted and 
                                        Reinsurance Reform Act 
                                        of 2010 (15 U.S.C. 8201 
                                        through 8206);
                                  (II) is issued by an 
                                insurance company that is not 
                                otherwise disapproved as a 
                                surplus lines insurer by the 
                                insurance regulator of the 
                                State in which the property to 
                                be insured is located; and
                                  (III) provides flood 
                                insurance coverage that 
                                complies with the laws and 
                                regulations of that State; or
                          (ii) an agreement with a mutual aid 
                        society for such society to cover 
                        expenses arising from damage to 
                        property of the members of such society 
                        caused by flooding, unless the State in 
                        which the property to be insured is 
                        located has--
                                  (I) determined that the 
                                specific mutual aid society may 
                                not provide such coverage or 
                                provide such coverage in such 
                                manner; or
                                  (II) specifically provided 
                                through law or regulation that 
                                mutual aid societies may not 
                                provide such coverage or 
                                provide such coverage in such 
                                manner.
                  (E) State.--The term ``State'' means any 
                State of the United States, the District of 
                Columbia, the Commonwealth of Puerto Rico, 
                Guam, the Northern Mariana Islands, the Virgin 
                Islands, and American Samoa.
  (c) Exceptions to Purchase Requirements.--
          (1) State-owned property.--Notwithstanding the other 
        provisions of this section, flood insurance shall not 
        be required on any State-owned property that is covered 
        under an adequate State policy of self-insurance 
        satisfactory to the Administrator. The Administrator 
        shall publish and periodically revise the list of 
        States to which this subsection applies.
          (2) Small loans.--Notwithstanding any other provision 
        of this section, subsections (a) and (b) shall not 
        apply to any loan having--
                  (A) an original outstanding principal balance 
                of [$5,000 or less] $25,000 or less, except 
                that such amount (as it may have been 
                previously adjusted) shall be adjusted for 
                inflation by the Administrator upon the 
                expiration of the 5-year period beginning upon 
                the enactment of the 21st Century Flood Reform 
                Act and upon the expiration of each successive 
                5-year period thereafter, in accordance with an 
                inflationary index selected by the 
                Administrator ; and
                  (B) a repayment term of 1 year or less.
          (3) Detached structures.--Notwithstanding any other 
        provision of this section, flood insurance shall not be 
        required, in the case of any residential property, for 
        any structure that is a part of such property but is 
        detached from the primary residential structure of such 
        property and does not serve as a residence.
  (d) Escrow of Flood Insurance Payments.--
          (1) Regulated lending institutions.--
                  (A) Federal entities responsible for lending 
                regulations.--Each Federal entity for lending 
                regulation (after consultation and coordination 
                with the Federal Financial Institutions 
                Examination Council) shall, by regulation, 
                direct that all premiums and fees for flood 
                insurance under the National Flood Insurance 
                Act of 1968, for residential improved real 
                estate or a mobile home, shall be paid to the 
                regulated lending institution or servicer for 
                any loan secured by the residential improved 
                real estate or mobile home, with the same 
                frequency as payments on the loan are made, for 
                the duration of the loan. Except as provided in 
                subparagraph (B), upon receipt of any premiums 
                or fees, the regulated lending institution or 
                servicer shall deposit such premiums and fees 
                in an escrow account on behalf of the borrower. 
                Upon receipt of a notice from the Administrator 
                or the provider of the flood insurance that 
                insurance premiums are due, the premiums 
                deposited in the escrow account shall be paid 
                to the provider of the flood insurance.
                  (B) Limitation.--Except as may be required 
                under applicable State law, a Federal entity 
                for lending regulation may not direct or 
                require a regulated lending institution to 
                deposit premiums or fees for flood insurance 
                under the National Flood Insurance Act of 1968 
                in an escrow account on behalf of a borrower 
                under subparagraph (A)--
                          (i) if--
                                  (I) the regulated lending 
                                institution has total assets of 
                                less than $1,000,000,000; and
                                  (II) on or before the date of 
                                enactment of the Biggert-Waters 
                                Flood Insurance Reform Act of 
                                2012, the regulated lending 
                                institution--
                                          (aa) in the case of a 
                                        loan secured by 
                                        residential improved 
                                        real estate or a mobile 
                                        home, was not required 
                                        under Federal or State 
                                        law to deposit taxes, 
                                        insurance premiums, 
                                        fees, or any other 
                                        charges in an escrow 
                                        account for the entire 
                                        term of the loan; and
                                          (bb) did not have a 
                                        policy of consistently 
                                        and uniformly requiring 
                                        the deposit of taxes, 
                                        insurance premiums, 
                                        fees, or any other 
                                        charges in an escrow 
                                        account for loans 
                                        secured by residential 
                                        improved real estate or 
                                        a mobile home; or
                          (ii) in the case of a loan that--
                                  (I) is in a junior or 
                                subordinate position to a 
                                senior lien secured by the same 
                                residential improved real 
                                estate or mobile home for which 
                                flood insurance is being 
                                provided at the time of the 
                                origination of the loan;
                                  (II) is secured by 
                                residential improved real 
                                estate or a mobile home that is 
                                part of a condominium, 
                                cooperative, or other project 
                                development, if the residential 
                                improved real estate or mobile 
                                home is covered by a flood 
                                insurance policy that--
                                          (aa) meets the 
                                        requirements that the 
                                        regulated lending 
                                        institution is required 
                                        to enforce under 
                                        subsection (b)(1);
                                          (bb) is provided by 
                                        the condominium 
                                        association, 
                                        cooperative, homeowners 
                                        association, or other 
                                        applicable group; and
                                          (cc) the premium for 
                                        which is paid by the 
                                        condominium 
                                        association, 
                                        cooperative, homeowners 
                                        association, or other 
                                        applicable group as a 
                                        common expense;
                                  (III) is secured by 
                                residential improved real 
                                estate or a mobile home that is 
                                used as collateral for a 
                                business purpose;
                                  (IV) is a home equity line of 
                                credit;
                                  (V) is a nonperforming loan; 
                                or
                                  (VI) has a term of not longer 
                                than 12 months.
          (2) Federal agency lenders.--Each Federal agency 
        lender shall by regulation require and provide for 
        escrow and payment of any flood insurance premiums and 
        fees relating to residential improved real estate and 
        mobile homes securing loans made by the Federal agency 
        lender under the circumstances and in the manner 
        provided under paragraph (1). Any regulations issued 
        under this paragraph shall be consistent with and 
        substantially identical to the regulations issued under 
        paragraph (1).
          (3) Applicability of respa.--Escrow accounts 
        established pursuant to this subsection shall be 
        subject to the provisions of section 10 of the Real 
        Estate Settlement Procedures Act of 1974.
          (4) Definition.--For purposes of this subsection, the 
        term ``residential improved real estate'' means 
        improved real estate for which the improvement is a 
        residential building.
          (5) Applicability.--This subsection shall apply only 
        with respect to any loan made, increased, extended, or 
        renewed after the expiration of the 1-year period 
        beginning on the date of enactment of the Riegle 
        Community Development and Regulatory Improvement Act of 
        1994.
  (e) Placement of Flood Insurance by Lender.--
          (1) Notification to borrower of lack of coverage.-- 
        [If] Subject to subsection (i) of this section, if , at 
        the time of origination or at any time during the term 
        of a loan secured by improved real estate or by a 
        mobile home located in an area that has been identified 
        by the Administrator (at the time of the origination of 
        the loan or at any time during the term of the loan) as 
        an area having special flood hazards and in which flood 
        insurance is available under the National Flood 
        Insurance Act of 1968, the lender or servicer for the 
        loan determines that the building or mobile home and 
        any personal property securing the loan is not covered 
        by flood insurance or is covered by such insurance in 
        an amount less than the amount required for the 
        property pursuant to paragraph (1), (2), or (3) of 
        subsection (b), the lender or servicer shall notify the 
        borrower under the loan that the borrower should 
        obtain, at the borrower's expense, an amount of flood 
        insurance for the building or mobile home and such 
        personal property that is not less than the amount 
        under subsection (b)(1), for the term of the loan.
          (2) Purchase of coverage on behalf of borrower.--If 
        the borrower fails to purchase such flood insurance 
        within 45 days after notification under paragraph (1), 
        the lender or servicer for the loan shall purchase the 
        insurance on behalf of the borrower and may charge the 
        borrower for the cost of premiums and fees incurred by 
        the lender or servicer for the loan in purchasing the 
        insurance, including premiums or fees incurred for 
        coverage beginning on the date on which flood insurance 
        coverage lapsed or did not provide a sufficient 
        coverage amount.
          (3) Termination of force-placed insurance.--Within 30 
        days of receipt by the lender or servicer of a 
        confirmation of a borrower's existing flood insurance 
        coverage, the lender or servicer shall--
                  (A) terminate any insurance purchased by the 
                lender or servicer under paragraph (2); and
                  (B) refund to the borrower all premiums paid 
                by the borrower for any insurance purchased by 
                the lender or servicer under paragraph (2) 
                during any period during which the borrower's 
                flood insurance coverage and the insurance 
                coverage purchased by the lender or servicer 
                were each in effect, and any related fees 
                charged to the borrower with respect to the 
                insurance purchased by the lender or servicer 
                during such period.
          (4) Sufficiency of demonstration.--For purposes of 
        confirming a borrower's existing flood insurance 
        coverage, a lender or servicer for a loan shall accept 
        from the borrower an insurance policy declarations page 
        that includes the existing flood insurance policy 
        number and the identity of, and contact information 
        for, the insurance company or agent.
          (5) Review of determination regarding required 
        purchase.--
                  (A) In general.--The borrower and lender for 
                a loan secured by improved real estate or a 
                mobile home may jointly request the 
                Administrator to review a determination of 
                whether the building or mobile home is located 
                in an area having special flood hazards. Such 
                request shall be supported by technical 
                information relating to the improved real 
                estate or mobile home. Not later than 45 days 
                after the Administrator receives the request, 
                the Administrator shall review the 
                determination and provide to the borrower and 
                the lender with a letter stating whether or not 
                the building or mobile home is in an area 
                having special flood hazards. The determination 
                of the Administrator shall be final.
                  (B) Effect of determination.--Any person to 
                whom a borrower provides a letter issued by the 
                Administrator pursuant to subparagraph (A), 
                stating that the building or mobile home 
                securing the loan of the borrower is not in an 
                area having special flood hazards, shall have 
                no obligation under this title to require the 
                purchase of flood insurance for such building 
                or mobile home during the period determined by 
                the Administratorwhich shall be specified in 
                the letter and shall begin on the date on which 
                such letter is provided.
                  (C) Effect of failure to respond.--If a 
                request under subparagraph (A) is made in 
                connection with the origination of a loan and 
                the Administrator fails to provide a letter 
                under subparagraph (A) before the later of (i) 
                the expiration of the 45-day period under such 
                subparagraph, or (ii) the closing of the loan, 
                no person shall have an obligation under this 
                title to require the purchase of flood 
                insurance for the building or mobile home 
                securing the loan until such letter is 
                provided.
          (6) Applicability.--This subsection shall apply to 
        all loans outstanding on or after the date of enactment 
        of the Riegle Community Development and Regulatory 
        Improvement Act of 1994.
  (f) Civil Monetary Penalties for Failure To Require Flood 
Insurance or Notify.--
          (1) Civil monetary penalties against regulated 
        lenders.--Any regulated lending institution that is 
        found to have a pattern or practice of committing 
        violations under paragraph (2) shall be assessed a 
        civil penalty by the appropriate Federal entity for 
        lending regulation in the amount provided under 
        paragraph (5).
          (2) Lender violations.--The violations referred to in 
        paragraph (1) shall include--
                  (A) making, increasing, extending, or 
                renewing loans in violation of--
                          (i) the regulations issued pursuant 
                        to subsection (b) of this section;
                          (ii) the escrow requirements under 
                        subsection (d) of this section; or
                          (iii) the notice requirements under 
                        section 1364 of the National Flood 
                        Insurance Act of 1968; or
                  (B) failure to provide notice or purchase 
                flood insurance coverage in violation of 
                subsection (e) of this section.
          (3) Civil monetary penalties against gse's.--
                  (A) In general.--If the Federal National 
                Mortgage Association or the Federal Home Loan 
                Mortgage Corporation is found by the Director 
                of the Federal Housing Finance Agency to have a 
                pattern or practice of purchasing loans in 
                violation of the procedures established 
                pursuant to subsection (b)(3), the Director of 
                such Office shall assess a civil penalty 
                against such enterprise in the amount provided 
                under paragraph (5) of this subsection.
                  (B) Definition.--For purposes of this 
                subsection, the term ``enterprise'' means the 
                Federal National Mortgage Association or the 
                Federal Home Loan Mortgage Corporation.
          (4) Notice and hearing.--A penalty under this 
        subsection may be issued only after notice and an 
        opportunity for a hearing on the record.
          (5) Amount.--A civil monetary penalty under this 
        subsection may not exceed [$2,000] $5,000 for each 
        violation under paragraph (2) or paragraph (3).
          (6) Lender compliance.--Notwithstanding any State or 
        local law, for purposes of this subsection, any 
        regulated lending institution that purchases flood 
        insurance or renews a contract for flood insurance on 
        behalf of or as an agent of a borrower of a loan for 
        which flood insurance is required shall be considered 
        to have complied with the regulations issued under 
        subsection (b).
          (7) Effect of transfer on liability.--Any sale or 
        other transfer of a loan by a regulated lending 
        institution that has committed a violation under 
        paragraph (1), that occurs subsequent to the violation, 
        shall not affect the liability of the transferring 
        lender with respect to any penalty under this 
        subsection. A lender shall not be liable for any 
        violations relating to a loan committed by another 
        regulated lending institution that previously held the 
        loan.
          (8) Deposit of penalties.--Any penalties collected 
        under this subsection shall be paid into the National 
        Flood Mitigation Fund under section 1367 of the 
        National Flood Insurance Act of 1968.
          (9) Additional penalties.--Any penalty under this 
        subsection shall be in addition to any civil remedy or 
        criminal penalty otherwise available.
          (10) Statute of limitations.--No penalty may be 
        imposed under this subsection after the expiration of 
        the 4-year period beginning on the date of the 
        occurrence of the violation for which the penalty is 
        authorized under this subsection.
  (g) Other Actions To Remedy Pattern of Noncompliance.--
          (1) Authority of federal entities for lending 
        regulation.--A Federal entity for lending regulation 
        may require a regulated lending institution to take 
        such remedial actions as are necessary to ensure that 
        the regulated lending institution complies with the 
        requirements of the national flood insurance program if 
        the Federal agency for lending regulation makes a 
        determination under paragraph (2) regarding the 
        regulated lending institution.
          (2) Determination of violations.--A determination 
        under this paragraph shall be a finding that--
                  (A) the regulated lending institution has 
                engaged in a pattern and practice of 
                noncompliance in violation of the regulations 
                issued pursuant to subsection (b), (d), or (e) 
                or the notice requirements under section 1364 
                of the National Flood Insurance Act of 1968; 
                and
                  (B) the regulated lending institution has not 
                demonstrated measurable improvement in 
                compliance despite the assessment of civil 
                monetary penalties under subsection (f).
  (h) Fee for Determining Location.--Notwithstanding any other 
Federal or State law, any person who makes a loan secured by 
improved real estate or a mobile home or any servicer for such 
a loan may charge a reasonable fee for the costs of determining 
whether the building or mobile home securing the loan is 
located in an area having special flood hazards, but only in 
accordance with the following requirements:
          (1) Borrower fee.--The borrower under such a loan may 
        be charged the fee, but only if the determination--
                  (A) is made pursuant to the making, 
                increasing, extending, or renewing of the loan 
                that is initiated by the borrower;
                  (B) is made pursuant to a revision or 
                updating under section 1360(f) of the 
                floodplain areas and flood-risk zones or 
                publication of a notice or compendia under 
                subsection (h) or (i) of section 1360 that 
                affects the area in which the improved real 
                estate or mobile home securing the loan is 
                located or that, in the determination of the 
                Administrator, may reasonably be considered to 
                require a determination under this subsection; 
                or
                  (C) results in the purchase of flood 
                insurance coverage pursuant to the requirement 
                under subsection (e)(2).
          (2) Purchaser or transferee fee.--The purchaser or 
        transferee of such a loan may be charged the fee in the 
        case of sale or transfer of the loan.
  (i) Satisfaction of Mandatory Purchase Requirement in States 
Allowing All-perils Policies.--
          (1) Waivers.--Section 102 shall not apply with 
        respect to residential properties in any State that 
        allows any property insurance coverage that covers 
        ``all-perils'' except specifically excluded perils that 
        includes coverage for flood perils in an amount at 
        least equal to the outstanding principal balance of the 
        loan or the maximum limit of flood insurance coverage 
        made available under this title with respect to such 
        type of residential property, whichever is less.
          (2) Definitions, procedures, standards.--The 
        Administrator may establish such definitions, 
        procedures, and standards as the Administrator 
        considers necessary for making determinations under 
        paragraph (1).
  (j) Flood Insurance Purchase Requirements.--Notwithstanding 
any other provision of law, a State or local government or 
private lender may require the purchase of flood insurance 
coverage for a structure that is located outside of an area 
having special flood hazards.

           *       *       *       *       *       *       *

                              ----------                              


           BIGGERT-WATERS FLOOD INSURANCE REFORM ACT OF 2012



           *       *       *       *       *       *       *
DIVISION F--MISCELLANEOUS

           *       *       *       *       *       *       *


                       TITLE II--FLOOD INSURANCE

Subtitle A--Flood Insurance Reform and Modernization

           *       *       *       *       *       *       *


SEC. 100216. NATIONAL FLOOD MAPPING PROGRAM.

  (a) Reviewing, Updating, and Maintaining Maps.--The 
Administrator, in coordination with the Technical Mapping 
Advisory Council established under section 100215, shall 
establish an ongoing program under which the Administrator 
shall review, update, and maintain National Flood Insurance 
Program rate maps in accordance with this section.
  (b) Mapping.--
          (1) In general.--In carrying out the program 
        established under subsection (a), the Administrator 
        shall--
                  (A) identify, review, update, maintain, and 
                publish National Flood Insurance Program rate 
                maps with respect to--
                          (i) all populated areas and areas of 
                        possible population growth located 
                        within the 100-year floodplain;
                          (ii) all populated areas and areas of 
                        possible population growth located 
                        within the 500-year floodplain;
                          (iii) areas of residual risk, 
                        including areas that are protected by 
                        levees, dams, and other flood control 
                        structures;
                          (iv) areas that could be inundated as 
                        a result of the failure of a levee, 
                        dam, or other flood control structure;
                          (v) areas that are protected by non-
                        structural flood mitigation features; 
                        and
                          (vi) the level of protection provided 
                        by flood control structures and by non-
                        structural flood mitigation features;
                  (B) establish or update flood-risk zone data 
                in all such areas, and make estimates with 
                respect to the rates of probable flood caused 
                loss for the various flood risk zones for each 
                such area; [and]
                  (C) use, in identifying, reviewing, updating, 
                maintaining, or publishing any National Flood 
                Insurance Program rate map required under this 
                section or under the National Flood Insurance 
                Act of 1968 (42 U.S.C. 4011 et seq.), the most 
                accurate topography and elevation data 
                available[.]; and
                  (D) consult and coordinate with the 
                Department of Defense, the United States 
                Geological Survey, and the National Oceanic and 
                Atmospheric Administration for the purpose of 
                obtaining the most-up-to-date maps and other 
                information of such agencies, including 
                information on topography, water flow, and any 
                other issues, relevant to mapping for flood 
                insurance purposes.
          (2) Mapping elements.--Each map updated under this 
        section shall--
                  (A) assess the accuracy of current ground 
                elevation data used for hydrologic and 
                hydraulic modeling of flooding sources and 
                mapping of the flood hazard and wherever 
                necessary acquire new ground elevation data 
                utilizing the most up-to-date geospatial 
                technologies in accordance with guidelines and 
                specifications of the Federal Emergency 
                Management Agency; and
                  (B) develop National Flood Insurance Program 
                flood data on a watershed basis--
                          (i) to provide the most technically 
                        effective and efficient studies and 
                        hydrologic and hydraulic modeling; and
                          (ii) to eliminate, to the maximum 
                        extent possible, discrepancies in base 
                        flood elevations between adjacent 
                        political subdivisions.
                   (3) Other inclusions.--In updating maps 
                under this section, the Administrator shall 
                include--
                  (A) any relevant information on coastal 
                inundation from--
                          (i) an applicable inundation map of 
                        the Corps of Engineers; and
                          (ii) data of the National Oceanic and 
                        Atmospheric Administration relating to 
                        storm surge modeling;
                  (B) any relevant information of the United 
                States Geological Survey on stream flows, 
                watershed characteristics, and topography that 
                is useful in the identification of flood hazard 
                areas, as determined by the Administrator;
                  (C) any relevant information on land 
                subsidence, coastal erosion areas, changing 
                lake levels, and other flood-related hazards;
                  (D) any relevant information or data of the 
                National Oceanic and Atmospheric Administration 
                and the United States Geological Survey 
                relating to the best available science 
                regarding future changes in sea levels, 
                precipitation, and intensity of hurricanes; 
                [and]
                  (E) any other information relevant to mapping 
                for flood insurance purposes obtained pursuant 
                to paragraph (1)(D); and
                  [(E)] (F) any other relevant information as 
                may be recommended by the Technical Mapping 
                Advisory Committee.
  (c) Standards.--In updating and maintaining maps under this 
section, the Administrator shall--
          (1) establish standards to--
                  (A) ensure that maps are adequate for--
                          (i) flood risk determinations; and
                          (ii) use by State and local 
                        governments in managing development to 
                        reduce the risk of flooding; and
                  (B) facilitate identification and use of 
                consistent methods of data collection and 
                analysis by the Administrator, in conjunction 
                with State and local governments, in developing 
                maps for communities with similar flood risks, 
                as determined by the Administrator; and
          (2) publish maps in a format that is--
                  (A) digital geospatial data compliant;
                  (B) compliant with the open publishing and 
                data exchange standards established by the Open 
                Geospatial Consortium; and
                  (C) aligned with official data defined by the 
                National Geodetic Survey.
  (d) Communication and Outreach.--
          (1) In general.--The Administrator shall--
                  (A) before commencement of any mapping or map 
                updating process, notify each community 
                affected of the model or models that the 
                Administrator plans to use in such process and 
                provide an explanation of why such model or 
                models are appropriate;
                  (B) provide each community affected a maximum 
                30-day period beginning upon notification under 
                subparagraph (A) to consult with the 
                Administrator regarding the appropriateness, 
                with respect to such community, of the mapping 
                model or models to be used; provided that 
                consultation by a community pursuant to this 
                subparagraph shall not waive or otherwise 
                affect any right of the community to appeal any 
                flood hazard determinations;
                  (C) upon completion of the first Independent 
                Data Submission, transmit a copy of such 
                Submission to the affected community, provide 
                the affected community a maximum 30-day period 
                during which the community may provide data to 
                Administrator that can be used to supplement or 
                modify the existing data, and incorporate any 
                data that is consistent with prevailing 
                engineering principles;
                  (D) work with States, local communities, and 
                property owners to identify areas and features 
                described in subsection (b)(1)(A)(v);
                  (E) work to enhance communication and 
                outreach to States, local communities, and 
                property owners about the effects--
                          (i) of any potential changes to 
                        National Flood Insurance Program rate 
                        maps that may result from the mapping 
                        program required under this section; 
                        and
                          (ii) that any such changes may have 
                        on flood insurance purchase 
                        requirements;
                  (F) engage with local communities to enhance 
                communication and outreach to the residents of 
                such communities, including tenants (with 
                regard to contents insurance), on the matters 
                described under subparagraph (E); and
                  (G) not less than 30 days before issuance of 
                any preliminary map, notify the Senators for 
                each State affected and each Member of the 
                House of Representatives for each congressional 
                district affected by the preliminary map in 
                writing of--
                          (i) the estimated schedule for--
                                  (I) community meetings 
                                regarding the preliminary map;
                                  (II) publication of notices 
                                regarding the preliminary map 
                                in local newspapers; and
                                  (III) the commencement of the 
                                appeals process regarding the 
                                map; and
                          (ii) the estimated number of homes 
                        and businesses that will be affected by 
                        changes contained in the preliminary 
                        map, including how many structures will 
                        be that were not previously located in 
                        an area having special flood hazards 
                        will be located within such an area 
                        under the preliminary map; and
                  (H) upon the issuance of any proposed map and 
                any notice of an opportunity to make an appeal 
                relating to the proposed map, notify the 
                Senators for each State affected each Member of 
                the House of Representatives for each 
                congressional district affected by the proposed 
                map of any action taken by the Administrator 
                with respect to the proposed map or an appeal 
                relating to the proposed map.
          (2) Required activities.--The communication and 
        outreach activities required under paragraph (1) shall 
        include--
                  (A) notifying property owners when their 
                properties become included in, or when they are 
                excluded from, an area covered by the mandatory 
                flood insurance purchase requirement under 
                section 102 of the Flood Disaster Protection 
                Act of 1973 (42 U.S.C. 4012a);
                  (B) educating property owners regarding the 
                flood risk and reduction of this risk in their 
                community, including the continued flood risks 
                to areas that are no longer subject to the 
                flood insurance mandatory purchase requirement;
                  (C) educating property owners regarding the 
                benefits and costs of maintaining or acquiring 
                flood insurance, including, where applicable, 
                lower-cost preferred risk policies under the 
                National Flood Insurance Act of 1968 (42 U.S.C. 
                4011 et seq.) for such properties and the 
                contents of such properties;
                  (D) educating property owners about flood map 
                revisions and the process available to such 
                owners to appeal proposed changes in flood 
                elevations through their community, including 
                by notifying local radio and television 
                stations; and
                  (E) encouraging property owners to maintain 
                or acquire flood insurance coverage.
  (e) Community Remapping Request.--Upon the adoption by the 
Administrator of any recommendation by the Technical Mapping 
Advisory Council for reviewing, updating, or maintaining 
National Flood Insurance Program rate maps in accordance with 
this section, a community that believes that its flood 
insurance rates in effect prior to adoption would be affected 
by the adoption of such recommendation may submit a request for 
an update of its rate maps, which may be considered at the 
Administrator's sole discretion. The Administrator shall 
establish a protocol for the evaluation of such community map 
update requests.
  (f) Authorization of Appropriations.--There is authorized to 
be appropriated to the Administrator to carry out this section 
$400,000,000 for each of fiscal years 2013 through 2017.

           *       *       *       *       *       *       *

                              ----------                              


                     FEDERAL DEPOSIT INSURANCE ACT



           *       *       *       *       *       *       *
  Sec. 10. (a) The Board of Directors shall administer the 
affairs of the Corporation fairly and impartially and without 
discrimination. The Board of Directors of the Corporation shall 
determine and prescribe the manner in which its obligations 
shall be incurred and its expenses allowed and paid. The 
Corporation shall be entitled to the free use of the United 
States mails in the same manner as the executive departments of 
the Government. The Corporation with the consent of any Federal 
Reserve bank or of any board, commission, independent 
establishment, or executive department of the Government, 
including any field service thereof, may avail itself of the 
use of information, services, and facilities thereof in 
carrying out the provisions of this Act.
  (b) Examinations.--
          (1) Appointment of examiners and claims agents.--The 
        Board of Directors shall appoint examiners and claims 
        agents.
          (2) Regular examinations.--Any examiner appointed 
        under paragraph (1) shall have power, on behalf of the 
        Corporation, to examine--
                  (A) any insured State nonmember bank or 
                insured State branch of any foreign bank;
                  (B) any depository institution which files an 
                application with the Corporation to become an 
                insured depository institution; and
                  (C) any insured depository institution in 
                default,
        whenever the Board of Directors determines an 
        examination of any such depository institution is 
        necessary.
          (3) Special examination of any insured depository 
        institution.--
                  (A) In general.--In addition to the 
                examinations authorized under paragraph (2), 
                any examiner appointed under paragraph (1) 
                shall have power, on behalf of the Corporation, 
                to make any special examination of any insured 
                depository institution or nonbank financial 
                company supervised by the Board of Governors or 
                a bank holding company described in section 
                165(a) of the Financial Stability Act of 2010, 
                whenever the Board of Directors determines that 
                a special examination of any such depository 
                institution is necessary to determine the 
                condition of such depository institution for 
                insurance purposes, or of such nonbank 
                financial company supervised by the Board of 
                Governors or bank holding company described in 
                section 165(a) of the Financial Stability Act 
                of 2010, for the purpose of implementing its 
                authority to provide for orderly liquidation of 
                any such company under title II of that Act, 
                provided that such authority may not be used 
                with respect to any such company that is in a 
                generally sound condition.
                  (B) Limitation.--Before conducting a special 
                examination of a nonbank financial company 
                supervised by the Board of Governors or a bank 
                holding company described in section 165(a) of 
                the Financial Stability Act of 2010, the 
                Corporation shall review any available and 
                acceptable resolution plan that the company has 
                submitted in accordance with section 165(d) of 
                that Act, consistent with the nonbinding effect 
                of such plan, and available reports of 
                examination, and shall coordinate to the 
                maximum extent practicable with the Board of 
                Governors, in order to minimize duplicative or 
                conflicting examinations.
          (4) Examination of affiliates.--
                  (A) In general.--In making any examination 
                under paragraph (2) or (3), any examiner 
                appointed under paragraph (1) shall have power, 
                on behalf of the Corporation, to make such 
                examinations of the affairs of any affiliate of 
                any depository institution as may be necessary 
                to disclose fully--
                          (i) the relationship between such 
                        depository institution and any such 
                        affiliate; and
                          (ii) the effect of such relationship 
                        on the depository institution.
                  (B) Commitment by foreign banks to allow 
                examinations of affiliates.--No branch or 
                depository institution subsidiary of a foreign 
                bank may become an insured depository 
                institution unless such foreign bank submits a 
                written binding commitment to the Board of 
                Directors to permit any examination of any 
                affiliate of such branch or depository 
                institution subsidiary pursuant to subparagraph 
                (A) to the extent determined by the Board of 
                Directors to be necessary to carry out the 
                purposes of this Act.
          (5) Examination of insured state branches.--The Board 
        of Directors shall--
                  (A) coordinate examinations of insured State 
                branches of foreign banks with examinations 
                conducted by the Board of Governors of the 
                Federal Reserve System under section 7(c)(1) of 
                the International Banking Act of 1978; and
                  (B) to the extent possible, participate in 
                any simultaneous examination of the United 
                States operations of a foreign bank requested 
                by the Board under such section.
          (6) Power and duty of examiners.--Each examiner 
        appointed under paragraph (1) shall--
                  (A) have power to make a thorough examination 
                of any insured depository institution or 
                affiliate under paragraph (2), (3), (4), or 
                (5); and
                  (B) shall make a full and detailed report of 
                condition of any insured depository institution 
                or affiliate examined to the Corporation.
          (7) Power of claim agents.--Each claim agent 
        appointed under paragraph (1) shall have power to 
        investigate and examine all claims for insured 
        deposits.
  (c) In connection with examinations of insured depository 
institutions and any State nonmember bank, savings association, 
or other institution making application to become insured 
depository institutions, and affiliates thereof, or with other 
types of investigations to determine compliance with applicable 
law and regulations, the appropriate Federal banking agency, or 
its designated representatives, are authorized to administer 
oaths and affirmations, and to examine and and to take and 
preserve testimony under oath as to any matter in respect to 
the affairs or ownership of any such bank or institution or 
affiliate thereof, and to exercise such other powers as are set 
forth in section 8(n) of this Act.
  (d) Annual On-Site Examinations of All Insured Depository 
Institutions Required.--
          (1) In general.--The appropriate Federal banking 
        agency shall, not less than once during each 12-month 
        period, conduct a full-scope, on-site examination of 
        each insured depository institution.
          (2) Examinations by corporation.--Paragraph (1) shall 
        not apply during any 12-month period in which the 
        Corporation has conducted a full-scope, on-site 
        examination of the insured depository institution.
          (3) State examinations acceptable.--The examinations 
        required by paragraph (1) may be conducted in alternate 
        12-month periods, as appropriate, if the appropriate 
        Federal banking agency determines that an examination 
        of the insured depository institution conducted by the 
        State during the intervening 12-month period carries 
        out the purpose of this subsection.
          (4)  18-month rule for certain small institutions.--
        Paragraphs (1), (2), and (3) shall apply with ``18-
        month'' substituted for ``12-month'' if--
                  (A) the insured depository institution has 
                total assets of less than $1,000,000,000;
                  (B) the institution is well capitalized, as 
                defined in section 38;
                  (C) when the institution was most recently 
                examined, it was found to be well managed, and 
                its composite condition--
                          (i) was found to be outstanding; or
                          (ii) was found to be outstanding or 
                        good, in the case of an insured 
                        depository institution that has total 
                        assets of not more than $200,000,000;
                  (D) the insured institution is not currently 
                subject to a formal enforcement proceeding or 
                order by the Corporation or the appropriate 
                Federal banking agency; and
                  (E) no person acquired control of the 
                institution during the 12-month period in which 
                a full-scope, on-site examination would be 
                required but for this paragraph.
          (5) Certain government-controlled institutions 
        exempted.--Paragraph (1) does not apply to--
                  (A) any institution for which the Corporation 
                is conservator; or
                  (B) any bridge depository institution, none 
                of the voting securities of which are owned by 
                a person or agency other than the Corporation.
          (6) Coordinated examinations.--To minimize the 
        disruptive effects of examinations on the operations of 
        insured depository institutions--
                  (A) each appropriate Federal banking agency 
                shall, to the extent practicable and consistent 
                with principles of safety and soundness and the 
                public interest--
                          (i) coordinate examinations to be 
                        conducted by that agency at an insured 
                        depository institution and its 
                        affiliates;
                          (ii) coordinate with the other 
                        appropriate Federal banking agencies in 
                        the conduct of such examinations;
                          (iii) work to coordinate with the 
                        appropriate State bank supervisor--
                                  (I) the conduct of all 
                                examinations made pursuant to 
                                this subsection; and
                                  (II) the number, types, and 
                                frequency of reports required 
                                to be submitted to such 
                                agencies and supervisors by 
                                insured depository 
                                institutions, and the type and 
                                amount of information required 
                                to be included in such reports; 
                                and
                          (iv) use copies of reports of 
                        examinations of insured depository 
                        institutions made by any other Federal 
                        banking agency or appropriate State 
                        bank supervisor to eliminate 
                        duplicative requests for information; 
                        and
                  (B) not later than 2 years after the date of 
                enactment of the Riegle Community Development 
                and Regulatory Improvement Act of 1994, the 
                Federal banking agencies shall jointly 
                establish and implement a system for 
                determining which one of the Federal banking 
                agencies or State bank supervisors shall be the 
                lead agency responsible for managing a unified 
                examination of each insured depository 
                institution and its affiliates, as required by 
                this subsection.
          (7) Separate examinations permitted.--Notwithstanding 
        paragraph (6), each appropriate Federal banking agency 
        may conduct a separate examination in an emergency or 
        under other exigent circumstances, or when the agency 
        believes that a violation of law may have occurred.
          (8) Report.--At the time the system provided for in 
        paragraph (6) is established, the Federal banking 
        agencies shall submit a joint report describing the 
        system to the Committee on Banking, Housing, and Urban 
        Affairs of the Senate and the Committee on Banking, 
        Finance and Urban Affairs of the House of 
        Representatives. Thereafter, the Federal banking 
        agencies shall annually submit a joint report to the 
        Committee on Banking, Housing, and Urban Affairs of the 
        Senate and the Committee on Banking, Finance and Urban 
        Affairs of the House of Representatives regarding the 
        progress of the agencies in implementing the system and 
        indicating areas in which enhancements to the system, 
        including legislature improvements, would be 
        appropriate.
          (9) Standards for determining adequacy of state 
        examinations.--The Federal Financial Institutions 
        Examination Council shall issue guidelines establishing 
        standards to be used at the discretion of the 
        appropriate Federal banking agency for purposes of 
        making a determination under paragraph (3).
          (10) Agencies authorized to increase maximum asset 
        amount of institutions for certain purposes.--At any 
        time after the end of the 2-year period beginning on 
        the date of enactment of the Riegle Community 
        Development and Regulatory Improvement Act of 1994, the 
        appropriate Federal banking agency, in the agency's 
        discretion, may increase the maximum amount limitation 
        contained in paragraph (4)(C)(ii), by regulation, from 
        $200,000,000 to an amount not to exceed $1,000,000,000 
        for purposes of such paragraph, if the agency 
        determines that the greater amount would be consistent 
        with the principles of safety and soundness for insured 
        depository institutions.
  (e) Examination Fees.--
          (1) Regular and special examinations of depository 
        institutions.--The cost of conducting any regular 
        examination or special examination of any depository 
        institution under subsection (b)(2), (b)(3), or (d) or 
        of any entity described in section 3(q)(2) may be 
        assessed by the Corporation against the institution or 
        entity to meet the expenses of the Corporation in 
        carrying out such examinations.
          (2) Examination of affiliates.--The cost of 
        conducting any examination of any affiliate of any 
        insured depository institution under subsection (b)(4) 
        may be assessed by the Corporation against each 
        affiliate which is examined to meet the Corporation's 
        expenses in carrying out such examination.
          (3) Assessment against depository institution in case 
        of affiliate's refusal to pay.--
                  (A) In general.--Subject to subparagraph (B), 
                if any affiliate of any insured depository 
                institution--
                          (i) refuses to pay any assessment 
                        under paragraph (2); or
                          (ii) fails to pay any such assessment 
                        before the end of the 60-day period 
                        beginning on the date the affiliate 
                        receives notice of the assessment,
                the Corporation may assess such cost against, 
                and collect such cost from, the depository 
                institution.
                  (B) Affiliate of more than 1 depository 
                institution.--If any affiliate referred to in 
                subparagraph (A) is an affiliate of more than 1 
                insured depository institution, the assessment 
                under subparagraph (A) may be assessed against 
                the depository institutions in such proportions 
                as the Corporation determines to be 
                appropriate.
          (4) Civil money penalty for affiliate's refusal to 
        cooperate.--
                  (A) Penalty imposed.--If any affiliate of any 
                insured depository institution--
                          (i) refuses to permit an examiner 
                        appointed by the Board of Directors 
                        under subsection (b)(1) to conduct an 
                        examination; or
                          (ii) refuses to provide any 
                        information required to be disclosed in 
                        the course of any examination,
                the depository institution shall forfeit and 
                pay a penalty of not more than $5,000 for each 
                day that any such refusal continues.
                  (B) Assessment and collection.--Any penalty 
                imposed under subparagraph (A) shall be 
                assessed and collected by the Corporation in 
                the manner provided in section 8(i)(2).
          (5) Deposits of examination assessment.--Amounts 
        received by the Corporation under this subsection 
        (other than paragraph (4)) may be deposited in the 
        manner provided in section 13.
  (f) Preservation of Agency Records.--
          (1) In general.--A Federal banking agency may cause 
        any and all records, papers, or documents kept by the 
        agency or in the possession or custody of the agency to 
        be--
                  (A) photographed or microphotographed or 
                otherwise reproduced upon film; or
                  (B) preserved in any electronic medium or 
                format which is capable of--
                          (i) being read or scanned by 
                        computer; and
                          (ii) being reproduced from such 
                        electronic medium or format by printing 
                        any other form of reproduction of 
                        electronically stored data.
          (2) Treatment as original records.--Any photographs, 
        microphotographs, or photographic film or copies 
        thereof described in paragraph (1)(A) or reproduction 
        of electronically stored data described in paragraph 
        (1)(B) shall be deemed to be an original record for all 
        purposes, including introduction in evidence in all 
        State and Federal courts or administrative agencies, 
        and shall be admissible to prove any act, transaction, 
        occurrence, or event therein recorded.
          (3) Authority of the federal banking agencies.--Any 
        photographs, microphotographs, or photographic film or 
        copies thereof described in paragraph (1)(A) or 
        reproduction of electronically stored data described in 
        paragraph (1)(B) shall be preserved in such manner as 
        the Federal banking agency shall prescribe, and the 
        original records, papers, or documents may be destroyed 
        or otherwise disposed of as the Federal banking agency 
        may direct.
  (g) Authority To Prescribe Regulations and Definitions.--
Except to the extent that authority under this Act is conferred 
on any of the Federal banking agencies other than the 
Corporation, the Corporation may--
          (1) prescribe regulations to carry out this Act; and
          (2) by regulation define terms as necessary to carry 
        out this Act.
  (h) Coordination of Examination Authority.--
          (1) State bank supervisors of home and host states.--
                  (A) Home state of bank.--The appropriate 
                State bank supervisor of the home State of an 
                insured State bank has authority to examine and 
                supervise the bank.
                  (B) Host state branches.--The State bank 
                supervisor of the home State of an insured 
                State bank and any State bank supervisor of an 
                appropriate host State shall exercise its 
                respective authority to supervise and examine 
                the branches of the bank in a host State in 
                accordance with the terms of any applicable 
                cooperative agreement between the home State 
                bank supervisor and the State bank supervisor 
                of the relevant host State.
                  (C) Supervisory fees.--Except as expressly 
                provided in a cooperative agreement between the 
                State bank supervisors of the home State and 
                any host State of an insured State bank, only 
                the State bank supervisor of the home State of 
                an insured State bank may levy or charge State 
                supervisory fees on the bank.
          (2) Host state examination.--
                  (A) In general.--With respect to a branch 
                operated in a host State by an out-of-State 
                insured State bank that resulted from an 
                interstate merger transaction approved under 
                section 44, or that was established in such 
                State pursuant to section 5155(g) of the 
                Revised Statutes of the United States, the 
                third undesignated paragraph of section 9 of 
                the Federal Reserve Act or section 18(d)(4) of 
                this Act, the appropriate State bank supervisor 
                of such host State may--
                          (i) with written notice to the State 
                        bank supervisor of the bank's home 
                        State and subject to the terms of any 
                        applicable cooperative agreement with 
                        the State bank supervisor of such home 
                        State, examine such branch for the 
                        purpose of determining compliance with 
                        host State laws that are applicable 
                        pursuant to section 24(j), including 
                        those that govern community 
                        reinvestment, fair lending, and 
                        consumer protection; and
                          (ii) if expressly permitted under and 
                        subject to the terms of a cooperative 
                        agreement with the State bank 
                        supervisor of the bank's home State or 
                        if such out-of-State insured State bank 
                        has been determined to be in a troubled 
                        condition by either the State bank 
                        supervisor of the bank's home State or 
                        the bank's appropriate Federal banking 
                        agency, participate in the examination 
                        of the bank by the State bank 
                        supervisor of the bank's home State to 
                        ascertain that the activities of the 
                        branch in such host State are not 
                        conducted in an unsafe or unsound 
                        manner.
                  (B) Notice of determination.--
                          (i) In general.--The State bank 
                        supervisor of the home State of an 
                        insured State bank shall notify the 
                        State bank supervisor of each host 
                        State of the bank if there has been a 
                        final determination that the bank is in 
                        a troubled condition.
                          (ii) Timing of notice.--The State 
                        bank supervisor of the home State of an 
                        insured State bank shall provide notice 
                        under clause (i) as soon as is 
                        reasonably possible, but in all cases 
                        not later than 15 business days after 
                        the date on which the State bank 
                        supervisor has made such final 
                        determination or has received written 
                        notification of such final 
                        determination.
          (3) Host state enforcement.--If the State bank 
        supervisor of a host State determines that a branch of 
        an out-of-State insured State bank is violating any law 
        of the host State that is applicable to such branch 
        pursuant to section 24(j), including a law that governs 
        community reinvestment, fair lending, or consumer 
        protection, the State bank supervisor of the host State 
        or, to the extent authorized by the law of the host 
        State, a host State law enforcement officer may, with 
        written notice to the State bank supervisor of the 
        bank's home State and subject to the terms of any 
        applicable cooperative agreement with the State bank 
        supervisor of the bank's home State, undertake such 
        enforcement actions and proceedings as would be 
        permitted under the law of the host State as if the 
        branch were a bank chartered by that host State.
          (4) Cooperative agreement.--
                  (A) In general.--The State bank supervisors 
                from 2 or more States may enter into 
                cooperative agreements to facilitate State 
                regulatory supervision of State banks, 
                including cooperative agreements relating to 
                the coordination of examinations and joint 
                participation in examinations.
                  (B) Definition.--For purposes of this 
                subsection, the term ``cooperative agreement'' 
                means a written agreement that is signed by the 
                home State bank supervisor and the host State 
                bank supervisor to facilitate State regulatory 
                supervision of State banks, and includes 
                nationwide or multi-State cooperative 
                agreements and cooperative agreements solely 
                between the home State and host State.
                  (C) Rule of construction.--Except for State 
                bank supervisors, no provision of this 
                subsection relating to such cooperative 
                agreements shall be construed as limiting in 
                any way the authority of home State and host 
                State law enforcement officers, regulatory 
                supervisors, or other officials that have not 
                signed such cooperative agreements to enforce 
                host State laws that are applicable to a branch 
                of an out-of-State insured State bank located 
                in the host State pursuant to section 24(j).
          (5) Federal regulatory authority.--No provision of 
        this subsection shall be construed as limiting in any 
        way the authority of any Federal banking agency.
          (6) State taxation authority not affected.--No 
        provision of this subsection shall be construed as 
        affecting the authority of any State or political 
        subdivision of any State to adopt, apply, or administer 
        any tax or method of taxation to any bank, bank holding 
        company, or foreign bank, or any affiliate of any bank, 
        bank holding company, or foreign bank, to the extent 
        that such tax or tax method is otherwise permissible by 
        or under the Constitution of the United States or other 
        Federal law.
          (7) Definitions.--For purpose of this section, the 
        following definitions shall apply:
                  (A) Host state, home state, out-of-State 
                bank.--The terms ``host State'', ``home 
                State'', and ``out-of-State bank'' have the 
                same meanings as in section 44(g).
                  (B) State supervisory fees.--The term ``State 
                supervisory fees'' means assessments, 
                examination fees, branch fees, license fees, 
                and all other fees that are levied or charged 
                by a State bank supervisor directly upon an 
                insured State bank or upon branches of an 
                insured State bank.
                  (C) Troubled condition.--Solely for purposes 
                of paragraph (2)(B), an insured State bank has 
                been determined to be in ``troubled condition'' 
                if the bank--
                          (i) has a composite rating, as 
                        determined in its most recent report of 
                        examination, of 4 or 5 under the 
                        Uniform Financial Institutions Ratings 
                        System;
                          (ii) is subject to a proceeding 
                        initiated by the Corporation for 
                        termination or suspension of deposit 
                        insurance; or
                          (iii) is subject to a proceeding 
                        initiated by the State bank supervisor 
                        of the bank's home State to vacate, 
                        revoke, or terminate the charter of the 
                        bank, or to liquidate the bank, or to 
                        appoint a receiver for the bank.
                  (D) Final determination.--For purposes of 
                paragraph (2)(B), the term ``final 
                determination'' means the transmittal of a 
                report of examination to the bank or 
                transmittal of official notice of proceedings 
                to the bank.
  (i) Flood Insurance Compliance by Insured Depository 
Institutions.--
          (1) Examinations.--The appropriate Federal banking 
        agency shall, during each scheduled on-site examination 
        required by this section, determine whether the insured 
        depository institution is complying with the 
        requirements of the national flood insurance program.
          (2) Report.--
                  (A) Requirement.--Not later than 1 year after 
                the [date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994 and biennially thereafter for the next 4 
                years] date of enactment of the 21st Century 
                Flood Reform Act and biennially thereafter , 
                each appropriate Federal banking agency shall 
                submit a report to the Congress on compliance 
                by insured depository institutions with the 
                requirements of the national flood insurance 
                program.
                  (B) Contents.--Each report submitted under 
                this paragraph shall include a description of 
                the methods used to determine compliance, the 
                number of institutions examined during the 
                reporting year, a listing and total number of 
                institutions found not to be in compliance, 
                actions taken to correct incidents of 
                noncompliance, and an analysis of compliance, 
                including a discussion of any trends, patterns, 
                and problems, and recommendations regarding 
                reasonable actions to improve the efficiency of 
                the examinations processes.
  (j) Consultation Among Examiners.--
          (1) In general.--Each appropriate Federal banking 
        agency shall take such action as may be necessary to 
        ensure that examiners employed by the agency--
                  (A) consult on examination activities with 
                respect to any depository institution; and
                  (B) achieve an agreement and resolve any 
                inconsistencies in the recommendations to be 
                given to such institution as a consequence of 
                any examinations.
          (2) Examiner-in-charge.--Each appropriate Federal 
        banking agency shall consider appointing an examiner-
        in-charge with respect to a depository institution to 
        ensure consultation on examination activities among all 
        of the examiners of that agency involved in 
        examinations of the institution.
  (k) One-Year Restrictions on Federal Examiners of Financial 
Institutions.--
          (1) In general.--In addition to other applicable 
        restrictions set forth in title 18, United States Code, 
        the penalties set forth in paragraph (6) of this 
        subsection shall apply to any person who--
                  (A) was an officer or employee (including any 
                special Government employee) of a Federal 
                banking agency or a Federal reserve bank;
                  (B) served 2 or more months during the final 
                12 months of his or her employment with such 
                agency or entity as the senior examiner (or a 
                functionally equivalent position) of a 
                depository institution or depository 
                institution holding company with continuing, 
                broad responsibility for the examination (or 
                inspection) of that depository institution or 
                depository institution holding company on 
                behalf of the relevant agency or Federal 
                reserve bank; and
                  (C) within 1 year after the termination date 
                of his or her service or employment with such 
                agency or entity, knowingly accepts 
                compensation as an employee, officer, director, 
                or consultant from--
                          (i) such depository institution, any 
                        depository institution holding company 
                        that controls such depository 
                        institution, or any other company that 
                        controls such depository institution; 
                        or
                          (ii) such depository institution 
                        holding company or any depository 
                        institution that is controlled by such 
                        depository institution holding company.
          (2) Definitions.--For purposes of this subsection--
                  (A) the term ``depository institution'' 
                includes an uninsured branch or agency of a 
                foreign bank, if such branch or agency is 
                located in any State; and
                  (B) the term ``depository institution holding 
                company'' includes any foreign bank or company 
                described in section 8(a) of the International 
                Banking Act of 1978.
          (3) Rules of construction.--For purposes of this 
        subsection, a foreign bank shall be deemed to control 
        any branch or agency of the foreign bank, and a person 
        shall be deemed to act as a consultant for a depository 
        institution, depository institution holding company, or 
        other company, only if such person directly works on 
        matters for, or on behalf of, such depository 
        institution, depository institution holding company, or 
        other company.
          (4) Regulations.--
                  (A) In general.--Each Federal banking agency 
                shall prescribe rules or regulations to 
                administer and carry out this subsection, 
                including rules, regulations, or guidelines to 
                define the scope of persons referred to in 
                paragraph (1)(B).
                  (B) Consultation required.--The Federal 
                banking agencies shall consult with each other 
                for the purpose of assuring that the rules and 
                regulations issued by the agencies under 
                subparagraph (A) are, to the extent possible, 
                consistent, comparable, and practicable, taking 
                into account any differences in the supervisory 
                programs utilized by the agencies for the 
                supervision of depository institutions and 
                depository institution holding companies.
          (5) Waiver.--
                  (A) Agency authority.--A Federal banking 
                agency may grant a waiver, on a case by case 
                basis, of the restriction imposed by this 
                subsection to any officer or employee 
                (including any special Government employee) of 
                that agency, and the Board of Governors of the 
                Federal Reserve System may grant a waiver of 
                the restriction imposed by this subsection to 
                any officer or employee of a Federal reserve 
                bank, if the head of such agency certifies in 
                writing that granting the waiver would not 
                affect the integrity of the supervisory program 
                of the relevant Federal banking agency.
                  (B) Definition.--For purposes of this 
                paragraph, the head of an agency is--
                          (i) the Comptroller of the Currency, 
                        in the case of the Office of the 
                        Comptroller of the Currency;
                          (ii) the Chairman of the Board of 
                        Governors of the Federal Reserve 
                        System, in the case of the Board of 
                        Governors of the Federal Reserve 
                        System; and
                          (iii) the Chairperson of the Board of 
                        Directors, in the case of the 
                        Corporation.
          (6) Penalties.--
                  (A) In general.--In addition to any other 
                administrative, civil, or criminal remedy or 
                penalty that may otherwise apply, whenever a 
                Federal banking agency determines that a person 
                subject to paragraph (1) has become associated, 
                in the manner described in paragraph (1)(C), 
                with a depository institution, depository 
                institution holding company, or other company 
                for which such agency serves as the appropriate 
                Federal banking agency, the agency shall impose 
                upon such person one or more of the following 
                penalties:
                          (i) Industry-wide prohibition 
                        order.--The Federal banking agency 
                        shall serve a written notice or order 
                        in accordance with and subject to the 
                        provisions of section 8(e)(4) for 
                        written notices or orders under 
                        paragraph (1) or (2) of section 8(e), 
                        upon such person of the intention of 
                        the agency--
                                  (I) to remove such person 
                                from office or to prohibit such 
                                person from further 
                                participation in the conduct of 
                                the affairs of the depository 
                                institution, depository 
                                institution holding company, or 
                                other company for a period of 
                                up to 5 years; and
                                  (II) to prohibit any further 
                                participation by such person, 
                                in any manner, in the conduct 
                                of the affairs of any insured 
                                depository institution for a 
                                period of up to 5 years.
                          (ii) Civil monetary penalty.--The 
                        Federal banking agency may, in an 
                        administrative proceeding or civil 
                        action in an appropriate United States 
                        district court, impose on such person a 
                        civil monetary penalty of not more than 
                        $250,000. Any administrative proceeding 
                        under this clause shall be conducted in 
                        accordance with section 8(i). In lieu 
                        of an action by the Federal banking 
                        agency under this clause, the Attorney 
                        General of the United States may bring 
                        a civil action under this clause in the 
                        appropriate United States district 
                        court.
                  (B) Scope of prohibition order.--Any person 
                subject to an order issued under subparagraph 
                (A)(i) shall be subject to paragraphs (6) and 
                (7) of section 8(e) in the same manner and to 
                the same extent as a person subject to an order 
                issued under such section.
                  (C) Definitions.--Solely for purposes of this 
                paragraph, the ``appropriate Federal banking 
                agency'' for a company that is not a depository 
                institution or depository institution holding 
                company shall be the Federal banking agency on 
                whose behalf the person described in paragraph 
                (1) performed the functions described in 
                paragraph (1)(B).

           *       *       *       *       *       *       *

                              ----------                              


                        FEDERAL CREDIT UNION ACT



           *       *       *       *       *       *       *
TITLE II--SHARE INSURANCE

           *       *       *       *       *       *       *


                  examination of insured credit unions

  Sec. 204. (a) The Board shall appoint examiners who shall 
have power, on its behalf, to examine any insured credit union, 
any credit union making application for insurance of its member 
accounts, or any closed insured credit union whenever in the 
judgment of the Board an examination is necessary to determine 
the condition of any such credit union for insurance purposes. 
Each examiner shall have power to make a thorough examination 
of all of the affairs of the credit union and shall make a full 
and detailed report of the condition of the credit union to the 
Board. The Board in like manner shall appoint claim agents who 
shall have power to investigate and examine all claims for 
insured member accounts. Each claim agent shall have power to 
administer oaths and affirmations, to examine and to take and 
preserve testimony under oath as to any matter in respect to 
claims for insured accounts, and to issue subpenas and subpenas 
duces tecum and, for the enforcement thereof, to apply to the 
United States district court for the judicial district or the 
United States court in any territory in which the principal 
office of the credit union is located or in which the witness 
resides or carries on business. Such courts shall have 
jurisdiction and power to order and require compliance with any 
such subpena.
  (b) In connection with examinations of insured credit unions, 
or with other types of investigations to determine compliance 
with applicable law and regulations, the Board, or its 
designated representatives, shall have power to administer 
oaths and affirmations, to examine and to take and preserve 
testimony under oath as to any matter in respect of the affairs 
of any such credit union, and to issue subpenas and subpenas 
duces tecum and to exercise such other powers as are set forth 
in section 206(p) and, for the enforcement thereof, to apply to 
the United States district court for the judicial district or 
the United States court in any territory in which the principal 
office of the credit union is located or in which the witness 
resides or carries on business. Such courts shall have 
jurisdiction and power to order and require compliance with any 
such subpena.
  (c) In cases of refusal to obey a subpena issued to, or 
contumacy by, any person, the Board may invoke the aid of any 
court of the United States within the jurisdiction of which 
such hearing, examination, or investigation is carried on, or 
where such person resides or carries on business, in requiring 
the attendance and testimony of witnesses and the production of 
books, records, or other papers. Such court may issue an order 
requiring such person to appear before the Board, or before a 
person designated by them, there to produce records, if so 
ordered, or to give testimony touching the matter in question. 
Any failure to obey such order of the court may be punished by 
such court as a contempt thereof. All process in any such case 
may be served in the judicial district whereof such person is 
an inhabitant or carries on business or wherever he may be 
found. No person shall be excused from attending and testifying 
or from producing books, records, or other papers in obedience 
to a subpena issued under the authority of this title on the 
ground that the testimony or evidence, documentary or 
otherwise, required of him may tend to incriminate him or 
subject him to penalty or forfeiture, but no individual shall 
be prosecuted or subject to any penalty or forfeiture for or on 
account of any transaction, matter, or thing concerning which 
he is compelled to testify or produce evidence, documentary or 
otherwise, after having claimed his privilege against self-
incrimination, except that such individual so testifying shall 
not be exempt from prosecution and punishment for perjury 
committed in so testifying.
  (d) The Administration may accept any report of examination 
made by or to any commission, board, or authority having 
supervision of a State-chartered credit union and may furnish 
to any such commission, board, or authority reports of 
examination made on behalf of the Board.
  (e) Flood Insurance Compliance by Insured Credit Unions.--
          (1) Examination.--The Board shall, during each 
        examination conducted under this section, determine 
        whether the insured credit union is complying with the 
        requirements of the national flood insurance program.
          (2) Report.--
                  (A) Requirement.--Not later than 1 year after 
                the [date of enactment of the Riegle Community 
                Development and Regulatory Improvement Act of 
                1994 and biennially thereafter for the next 4 
                years] date of enactment of the 21st Century 
                Flood Reform Act and annually thereafter , the 
                Board shall submit a report to the Congress on 
                compliance by insured credit unions with the 
                requirements of the national flood insurance 
                program.
                  (B) Contents.--The report shall include a 
                description of the methods used to determine 
                compliance, the number of insured credit unions 
                examined during the reporting year, a listing 
                and total number of insured credit unions found 
                not to be in compliance, actions taken to 
                correct incidents of noncompliance, and an 
                analysis of compliance, including a discussion 
                of any trends, patterns, and problems, and 
                recommendations regarding reasonable actions to 
                improve the efficiency of the examinations 
                processes.
  (f) Access to Liquidity.--The Board shall--
          (1) periodically assess the potential liquidity needs 
        of each insured credit union, and the options that the 
        credit union has available for meeting those needs; and
          (2) periodically assess the potential liquidity needs 
        of insured credit unions as a group, and the options 
        that insured credit unions have available for meeting 
        those needs.
  (g) Sharing Information With Federal Reserve Banks.--The 
Board shall, for the purpose of facilitating insured credit 
unions' access to liquidity, make available to the Federal 
reserve banks (subject to appropriate assurances of 
confidentiality) information relevant to making advances to 
such credit unions, including the Board's reports of 
examination.

           *       *       *       *       *       *       *

                              ----------                              


 FEDERAL HOUSING ENTERPRISES FINANCIAL SAFETY AND SOUNDNESS ACT OF 1992



           *       *       *       *       *       *       *
TITLE XIII--GOVERNMENT SPONSORED ENTERPRISES

           *       *       *       *       *       *       *


         Subtitle A--Supervision and Regulation of Enterprises

PART 1--FINANCIAL SAFETY AND SOUNDNESS REGULATOR

           *       *       *       *       *       *       *


SEC. 1319B. ANNUAL REPORTS BY DIRECTOR.

  (a) General Report.--The Director shall submit to the 
Committee on Financial Services of the House of Representatives 
and the Committee on Banking, Housing, and Urban Affairs of the 
Senate, not later than June 15 of each year, a written report, 
which shall include--
          (1) a description of the actions taken, and being 
        undertaken, by the Director to carry out this title;
          (2) a description of the financial safety and 
        soundness of each regulated entity, including the 
        results and conclusions of the annual examinations of 
        the regulated entities conducted under section 1317(a);
          (3) any recommendations for legislation to enhance 
        the financial safety and soundness of the regulated 
        entities;
          (4) a description of--
                  (A) whether the procedures established by 
                each regulated entity pursuant to section 
                102(b)(3) of the Flood Disaster Protection Act 
                of 1973 are adequate and being complied with, 
                and
                  (B) the results and conclusions of any 
                examination, as determined necessary by the 
                Director, to determine the compliance of the 
                regulated entities with the requirements of 
                section 102(b)(3) of such Act, which shall 
                include a description of the methods used to 
                determine compliance and the types and sources 
                of deficiencies (if any), and identify any 
                corrective measures that have been taken to 
                remedy any such deficiencies,
        except that the information described in this paragraph 
        shall be included only in each of the [first, third, 
        and fifth annual reports under this subsection required 
        to be submitted after the expiration of the 1-year 
        period beginning on the date of enactment of the Riegle 
        Community Development and Regulatory Improvement Act of 
        1994] first annual report under this subsection 
        required to be submitted after the expiration of the 1-
        year period beginning on the date of enactment of the 
        21st Century Flood Reform Act and every such second 
        annual report thereafter ; and
          (5) the assessment of the Board or any of its members 
        with respect to--
                  (A) the safety and soundness of the regulated 
                entities;
                  (B) any material deficiencies in the conduct 
                of the operations of the regulated entities;
                  (C) the overall operational status of the 
                regulated entities; and
                  (D) an evaluation of the performance of the 
                regulated entities in carrying out their 
                respective missions;
          (6) operations, resources, and performance of the 
        Agency; and
          (7) such other matters relating to the Agency and the 
        fulfillment of its mission.
  (b) Report on Enforcement Actions.--Not later than March 15 
of each year, the Director shall submit to the Committee on 
Financial Services of the House of Representatives and the 
Committee on Banking, Housing, and Urban Affairs of the Senate 
a written report describing, for the preceding calendar year, 
the requests by the Director to the Attorney General for 
enforcement actions under subtitle C and describing the 
disposition of each request, which shall include statements 
of--
          (1) the total number of requests made by the 
        Director;
          (2) the number of requests that resulted in the 
        commencement of litigation by the Department of 
        Justice;
          (3) the number of requests that did not result in the 
        commencement of litigation by the Department of 
        Justice;
          (4) with respect to requests that resulted in the 
        commence-ment of litigation--
                  (A) the number of days between the date of 
                the request and the commencement of the 
                litigation; and
                  (B) the number of days between the date of 
                the commencement and termination of the 
                litigation; and
          (5) the number of litigation requests pending at the 
        beginning of the calendar year, the number of requests 
        made during the calendar year, the number of requests 
        for which action was completed during the calendar 
        year, and the number of requests pending at the end of 
        the calendar year.

           *       *       *       *       *       *       *


                             MINORITY VIEWS

    H.R. 2874 makes a number of changes to the National Flood 
Insurance Program (NFIP) that make flood insurance less 
affordable, less available, and less fair for consumers.
    H.R. 2874 would make flood insurance less affordable by 
raising premiums, fees, and surcharges on policyholders, while 
doing nothing to address the NFIP's debt or the billions of 
dollars being spent on interest to service that debt. 
Specifically, H.R. 2874 would require the Federal Emergency 
Management Agency (FEMA) to raise premiums for pre-FIRM 
policyholders by a minimum of 8 percent a year. The bill would 
require FEMA to increase annual surcharges on all primary 
residences by 60 percent and increase annual surcharges for 
second homes that are not in preferred risk areas by 10 
percent. The bill would also require FEMA to increase the 
Reserve Fund fee, which is already 15% of premiums, by one 
percent each year until the NFIP achieves a reserve ratio of 
7.5 percent, which may take several years to reach. That is yet 
another cost added on to policyholders' already expensive 
premiums. Additionally, the bill would make flood insurance 
less affordable by eliminating grandfathering. This would cause 
homeowners who built to code and did everything right, to pay 
higher premiums associated with new flood maps that did not 
exist at the time the property was built. Further, the bill's 
attempt to address longterm affordability challenges makes 
matters worse. Although H.R. 2874 allows states to voluntarily 
set up an affordability program, the bill does not provide any 
funding for them to do so. States would bear the administrative 
costs of setting up the programs, while the costs of any 
discounts to eligible policyholders would be paid for by 
premium and fee increases on other policyholders within the 
state, increasing the affordability challenges for middle 
income policyholders.
    H.R. 2874 would make flood insurance less available by 
prohibiting NFIP coverage for several classes of properties, 
subject to certain market conditions. Specifically, all newly 
constructed properties in a special flood hazard area (SFHA), 
any residential property with a replacement value higher than 
$1 million, and multiple loss properties for which the 
aggregate amount in claims payments exceed twice the amount of 
the replacement value of the structure, would be barred from 
accessing federal flood insurance. Instead, these policyholders 
would be forced to purchase flood insurance in the private 
market, which remains undeveloped. Due to the market's current 
limitations, the bill attempts to provide a safety valve to 
allow consumers who cannot find or afford insurance in the 
private market the opportunity to return to the NFIP. However, 
policyholders would be charged an additional ten percent 
surcharge for failing to find coverage in the private market 
through no fault of their own. Further, this ill-conceived 
safety valve is not available to properties with lifetime 
claims exceeding twice the amount of the structure's 
replacement value. Because the metric for excessive claims is 
based on the replacement value of the home, lower value homes 
will be disproportionately impacted, leaving these households 
at risk of displacement or overwhelming cost burdens. As 
borrowers lose NFIP coverage, and especially if alternative 
private coverage is not available or affordable, these 
properties will lose value and the risk of abandonment and/or 
foreclosure increases dramatically. The American Bankers 
Association (ABA) has warned that this provision could cause a 
decrease in property values because of the lack of available 
coverage and ``DI some flood prone communities, this could lead 
to a local or regional foreclosure crisis.''
    H.R. 2874 would make flood insurance less fair for 
consumers by opening the door to the potential for cherry-
picking of the lowest-risk properties by the private sector. 
Democrats support the responsible development of the private 
flood insurance market. However, H.R. 2874 would call for 
wholesale changes that undermine the NFIP and leave 
policyholders vulnerable in an untested private market. 
Specifically, H.R 2874 would eliminate the non-compete clause 
that prevents Write-Your-Own (WYO) companies from offering 
their own competing private flood insurance policies. The non-
compete clause is a long-standing condition of participation in 
the WYO Program and, according to FEMA, ensures that WYOs--who 
administer the NFIP while taking on none of the risk--do not 
inappropriately take advantage of their access to FEMA's data 
on policyholders to cherry pick or steer consumers towards a 
competing product. Eliminating the non-compete clause would 
also give WYOs an unfair competitive advantage compared to 
other private insurance companies, many of which have been able 
to successfully build a flood insurance portfolio without 
access to this data. Additionally, this bill would require FEMA 
to publicly disclose virtually all of its proprietary 
information related to claims, underwriting, and risks. While 
the bill stipulates that personally identifiable information is 
to be excluded, it is unclear how FEMA can comply with this 
requirement without violating the Privacy Act of 1974. 
Moreover, the sharing of proprietary information such as claims 
data is uncommon in the insurance industry. In fact, claims 
data and modeling information are the keys to competition 
amongst insurance companies and raises serious concerns about 
the potential for cherry-picking.
    While an amendment to this bill added language to 
reauthorize the NFIP for five years, the refocus outlined above 
are too harmful to enact for five years. For these reasons, we 
oppose H.R. 2874.

                                   Maxine Waters.
                                   Keith Ellison.
                                   Michael E. Capuano.
                                   Stephen F. Lynch.
                                   Carolyn B. Maloney.
                                   Joyce Beatty.
                                   Vicente Gonzalez.
                                   Daniel T. Kildee.
                                   Gwen Moore.
                                   Charlie Crist.
                                   Brad Sherman.
                                   Nydia M. Velaquez.
                                   Al Green.
                                   Gregory W. Meeks.
                                   Emanuel Cleaver.