[Federal Register Volume 69, Number 178 (Wednesday, September 15, 2004)]
[Notices]
[Pages 55642-55643]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-20761]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency


Pilot Program for the Mitigation of Severe Repetitive Loss 
Properties

AGENCY: Mitigation Division, Federal Emergency Management Agency 
(FEMA), Emergency Preparedness and Response Directorate, Department of 
Homeland Security.

ACTION: Notice of meeting and request for comments.

-----------------------------------------------------------------------

SUMMARY: Section 1361A of the National Flood Insurance Act of 1968 (the 
Act), as amended by section 102 of the Bunning-Bereuter-Blumenauer 
Flood Insurance Reform Act of 2004 (Pub. L. 108-264), 42 U.S.C. 4102a., 
authorizes a new Pilot Program for the Mitigation of Severe Repetitive 
Loss Properties. Section 1361A(j) of the Act requires FEMA to consult 
with State and local officials and to provide an opportunity for oral 
presentation, on the record, of the data and arguments from such 
officials on developing procedures for the distribution of funds to 
carry out eligible mitigation activities under the Pilot Program. 
Accordingly, with this notice FEMA is initiating consultation with 
State and local officials, as well as members of the public, on 
procedures for the new Pilot Program. Interested parties may submit 
written comments in response to this notice during the consultation 
period. During this period, FEMA will hold a meeting in mid-November, 
2004 with representative officials of State and local governments, 
organizations representing the emergency management, floodplain 
management, and insurance professions, and other interested parties, 
for input on overall program requirements and procedures for the new 
grant funds, including issues raised in this notice.

DATES: Written comments may be received no later than November 30, 
2004.

ADDRESSES: Please send written comments, including responses to the 
questions raised in this notice, to the Rules Docket Clerk, Office of 
the General Counsel, Federal Emergency Management Agency, 500 C Street, 
SW., room 840, Washington DC 20472, (facsimile) (202) 646-4536, or (e-
mail) [email protected].

FOR FURTHER INFORMATION CONTACT: Cecelia Rosenberg, Federal Emergency 
Management Agency, Mitigation Division, Risk Reduction Branch, 500 C 
Street, SW., room 417, Washington, DC 20472, (202) 646-3321 or e-mail 
[email protected].

SUPPLEMENTARY INFORMATION: The purpose of this Notice is to announce 
that FEMA is soliciting input from State and local officials, as well 
as from the emergency management, floodplain management, and insurance 
industry communities, and other interested parties on considerations 
for the development of grant program requirements and procedures for 
the newly authorized Pilot Program for the Mitigation of Severe 
Repetitive Loss Properties. FEMA will hold a meeting in mid-November, 
2004 with representative State and local officials for oral comment on 
the issues raised in this notice, and also invites all interested 
parties to provide written comments by November 30, 2004.
    Program Description. Section 1361A of the Act authorizes FEMA to 
implement a Pilot Program that would provide financial assistance to 
States and communities for the Mitigation of Severe Repetitive Loss 
Properties with funding of up to $40 million each year that will remain 
available until expended. The Pilot Program represents a concentrated 
effort to mitigate those insured properties that have suffered the 
greatest amount of damage in terms of claims against the National Flood 
Insurance Fund. Severe repetitive loss properties are defined in 
section 1361A(b)(1) of the Act as Single Family Properties consisting 
of one to four family residences that are covered under a contract for 
flood insurance made available under the Act which have had four or 
more claims with each claim exceeding $5,000 and with the cumulative 
payments exceeding $20,000, or which have had at least two claim 
payments that cumulatively exceed the value of the property. Section 
1361A(l) of the Act requires that the Pilot Program terminate on 
September 30, 2009.
    In summary, the Act contains the following provisions for the Pilot 
Program:
     Section 1361A(b)(2) of the Act requires FEMA to provide 
the definition of a severe repetitive loss property as it pertains to 
property consisting of five or more residences;
     Section 1361A(c) of the Act identifies the mitigation 
activities eligible for funding;
     Section 1361A(d) of the Act provides FEMA with the 
authority to establish cost-share incentives for States participating 
in the program;
     Section 1361A(e) of the Act requires FEMA to identify 
severe repetitive loss properties and notify States, communities, and 
owners of such properties of the availability of mitigation assistance 
as well as the consequences of declining such mitigation offers;
     Sections 1361A(f) and section 1361A(g) of the Act 
establish standards and limitations by which FEMA can make mitigation 
offers;
     Section 1361A(h)(1) through (5) of the Act provides for 
insurance rate increases for property owners who decline mitigation 
offers within participating States;
     Section 1361A(h)(6) of the Act requires FEMA to establish 
a process through which policyholders may appeal insurance rate 
increases imposed when declining offers of mitigation, and to submit a 
report to Congress on rules, procedures, and administration of this 
process;
     Section 1361A(j)(1) of the Act requires FEMA to develop 
rules governing procedures for the distribution of funds to States; and
     Section 1361A(j)(2) of the Act requires FEMA to consult 
with State and local officials within 90 days of the passage of this 
Act to provide an oral presentation, on the record, of data and 
arguments for developing procedures for the distribution of funds to 
States and communities to carry out eligible mitigation activities.
    Incentives and Consequences. Section 1361A of the Act provides FEMA 
with the authority to establish incentives and consequences designed to 
increase participation in the Pilot Program and to reduce the number of 
severe repetitive loss properties in the National Flood Insurance 
Program. Section 1361A(d)(2) of the Act allows FEMA to increase the 
Federal share of a grant awarded to recipients under the Pilot Program 
from 75 percent to 90 percent if the State has a FEMA-approved State 
mitigation plan consistent with 44 CFR Part 201 that specifies how the 
State will reduce the number of severe repetitive loss properties and 
if the State has taken actions to mitigate the severe repetitive loss 
properties within the State. Section 1361A(h)(1) and (2) of the Act 
requires FEMA to impose insurance premium rate increases for property 
owners who decline mitigation offers under the Pilot Program.
    Notification. Section 1361A(e)(1)(A) through (C) and section 
1361A(e)(2) of the Act require that FEMA identify and

[[Page 55643]]

notify all owners of severe repetitive loss properties, as well as 
States and communities, that their properties meet the definition of a 
severe repetitive loss property; and that the properties are eligible 
for assistance under this section. Section 1361A(e)(1)(D) and section 
1361A(e)(1)(E) of the Act also require FEMA to notify severe repetitive 
loss property owners that there are insurance implications for 
declining offers of mitigation assistance proposed by States and/or 
communities under the Pilot Program and that there is a right to appeal 
provided for under this section. Section 1361A(h)(6) of the Act 
requires FEMA to establish a process for the Pilot Program through 
which policyholders can appeal the increase in their premiums if they 
turn down a mitigation offer. The Act limits grounds for appeal to 
those stated in section 1361A(h)(6)(A).
    Eligible Activities. Section 1361A(c) of the Act identifies 
eligible mitigation activities, which are limited to: elevation, 
acquisition, relocation, flood proofing, minor physical localized flood 
control projects, and certain demolition and rebuild projects. Section 
1361A(g)(1) of the Act places restrictions on the reuse of acquired 
land that are consistent with the requirements of section 404(b)(2)(B) 
of the Robert T. Stafford Disaster Relief and Emergency Assistance Act 
(42 U.S.C. 5170c(b)(2)(B)). Section 1361A(f)(3) of the Act requires 
that States and communities must consult with all property owners when 
selecting appropriate mitigation options, and notify each holder of 
recorded interest in a property of any offers of mitigation assistance.
    Allocation of Funds. Section 1361A(f)(1) of the Act requires FEMA 
to provide assistance for properties in the order that will result in 
the greatest amount of savings to the National Flood Insurance Fund in 
the shortest period of time. Section 1361A(f)(5) of the Act stipulates 
that funds are to be distributed based upon the percentage of severe 
repetitive loss properties within the State, and identifies additional 
provisions for the redistribution of unspent funds.
    Rules. Section 1361A(j)(1) of the Act requires FEMA to develop 
procedures for the distribution of funds under the Pilot Program for 
the Mitigation of Severe Repetitive Loss Properties and to ensure that 
the procedures meet the following criteria:
     Require the Director to notify States and communities of 
the availability of grant funding and that participation in the Pilot 
Program is optional;
     Provide that the Director may assist States and 
communities in identifying severe repetitive loss properties;
     Allow States and communities to select properties to be 
mitigated and the eligible mitigation activity to be performed; and
     Require each State or community to submit a list of severe 
repetitive loss properties they would like to be the subject of 
eligible activities.
    Consultation. FEMA is providing letters of invitation to the 
Consultation meeting to representatives from the Association of State 
Floodplain Managers (ASFPM), the National Emergency Management 
Association (NEMA), the International Emergency Management Association 
(IEMA), other interested organizations, representatives from all 
States, and representatives from communities with 20 or more severe 
repetitive loss properties. Those wishing to submit written comments 
should send them to the to the Rules Docket Clerk, Office of the 
General Counsel, Federal Emergency Management Agency, 500 C Street, 
SW., room 840, Washington DC 20472, (facsimile) 202-646-4536, or (e-
mail) [email protected].
    While the focus of this meeting will be to solicit input for FEMA 
to consider on the distribution of funds under the Pilot Program, 
invitees may respond to any of the questions below in their oral or 
written comments. Section 1361A(j)(2) of the Act specifically directs 
FEMA to consult on the process for distribution of funds, however FEMA 
also wishes to gather comments on the overall Program from our partners 
and stakeholders. FEMA is soliciting responses to the following 
questions:
    1. What key factors should FEMA consider in developing the Pilot 
Program for Mitigation Severe Repetitive Loss Properties under section 
1361A?
    2. What parameters should FEMA use to define severe repetitive loss 
for multi-family structures consisting of five or more residences?
    3. What process should FEMA use to notify property owners that 
their property is considered a severe repetitive loss property as 
defined by the statute?
    4. What criteria should FEMA consider when allocating funds to 
States and/or communities under the Pilot Program? Should FEMA consider 
base allocations for States with higher numbers of severe repetitive 
loss properties?
    5. Should there be caps on Pilot Program funding for States and 
communities similar to Flood Mitigation Assistance program funds? If 
so, how would the cap amounts be determined?
    6. What criteria should FEMA use to review and approve State 
mitigation plans consistent with 44 CFR Part 201 to ensure that they 
contain recommended actions to mitigate severe repetitive loss 
properties?
    7. What criteria should FEMA use to make the determination that a 
State has taken actions to reduce the number of severe repetitive loss 
properties in its communities?
    8. What criteria should FEMA use to determine projects that will 
result in the greatest amount of savings to the National Flood 
Insurance Fund? How should the criteria relate to current FEMA 
procedures for determining cost effectiveness?
    9. What types of assistance do States and communities want from 
FEMA when making offers to owners of severe repetitive loss properties?
    10. What role should States and communities have in the appeals 
process for severe repetitive loss property owners who decline 
mitigation offers under the Pilot Program? What rules and procedures 
should be contained in the appeals process?

    Dated: September 10, 2004.
David I. Maurstad,
Acting Director Mitigation Division, Emergency Preparedness and 
Response Directorate, Department of Homeland Security.
[FR Doc. 04-20761 Filed 9-14-04; 8:45 am]
BILLING CODE 9110-41-P