[113th Congress Public Law 89]
[From the U.S. Government Publishing Office]
[[Page 1019]]
HOMEOWNER FLOOD INSURANCE AFFORDABILITY ACT OF 2014
[[Page 128 STAT. 1020]]
Public Law 113-89
113th Congress
An Act
To delay the implementation of certain provisions of the Biggert-Waters
Flood Insurance Reform Act of 2012, and for other purposes. <<NOTE: Mar.
21, 2014 - [H.R. 3370]>>
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled, <<NOTE: Homeowner Flood
Insurance Affordability Act of 2014.>>
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) Short <<NOTE: 42 USC 4001 note.>> Title.--This Act may be cited
as the ``Homeowner Flood Insurance Affordability Act of 2014''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title and table of contents.
Sec. 2. Definitions.
Sec. 3. Repeal of certain rate increases.
Sec. 4. Restoration of grandfathered rates.
Sec. 5. Requirements regarding annual rate increases.
Sec. 6. Clarification of rates for properties newly mapped into areas
with special flood hazards.
Sec. 7. Premiums and reports.
Sec. 8. Annual premium surcharge.
Sec. 9. Draft affordability framework.
Sec. 10. Risk transfer.
Sec. 11. Monthly installment payment for premiums.
Sec. 12. Optional high-deductible policies for residential properties.
Sec. 13. Exclusion of detached structures from mandatory purchase
requirement.
Sec. 14. Accounting for flood mitigation activities in estimates of
premium rates.
Sec. 15. Home improvement fairness.
Sec. 16. Affordability study and report.
Sec. 17. Flood insurance rate map certification.
Sec. 18. Funds to reimburse homeowners for successful map appeals.
Sec. 19. Flood protection systems.
Sec. 20. Quarterly reports regarding Reserve Fund ratio.
Sec. 21. Treatment of floodproofed residential basements.
Sec. 22. Exemption from fees for certain map change requests.
Sec. 23. Study of voluntary community-based flood insurance options.
Sec. 24. Designation of flood insurance advocate.
Sec. 25. Exceptions to escrow requirement for flood insurance payments.
Sec. 26. Flood mitigation methods for buildings.
Sec. 27. Mapping of non-structural flood mitigation features.
Sec. 28. Clear communications.
Sec. 29. Protection of small businesses, non-profits, houses of worship,
and residences.
Sec. 30. Mapping.
Sec. 31. Disclosure.
SEC. 2. <<NOTE: 42 USC 4005.>> DEFINITIONS.
For purposes of this title, the following definitions shall apply:
(1) Administrator.--The term ``Administrator'' means the
Administrator of the Federal Emergency Management Agency.
(2) National flood insurance program.--The term ``National
Flood Insurance Program'' means the program established under
the National Flood Insurance Act of 1968 (42 U.S.C. 4001 et
seq.).
[[Page 128 STAT. 1021]]
SEC. 3. <<NOTE: 42 USC 4014 note.>> REPEAL OF CERTAIN RATE
INCREASES.
(a) Repeal.--
(1) In general.--Section 1307(g) of the National Flood
Insurance Act of 1968 (42 U.S.C. 4014(g)) is amended--
(A) by striking paragraphs (1) and (2);
(B) in paragraph (3), by striking ``as a result of
the deliberate choice of the holder of such policy'' and
inserting ``, 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''; and
(C) by redesignating paragraphs (3) and (4) as
paragraphs (1) and (2), respectively.
(2) Effective date.--The Administrator shall make available
such rate tables, as necessary to implement the amendments made
by paragraph (1) as if it were enacted as part of the Biggert-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141;
126 Stat. 957).
(3) Implementation, coordination, and guidance.--
(A) Facilitation <<NOTE: Consultation.>> of timely
refunds.--To ensure the participation of Write Your Own
companies (as such term is defined in section 100202(a)
of the Biggert-Waters Flood Insurance Reform Act of 2012
(42 U.S.C. 4004(a)), the Administrator and the Federal
Emergency Management Agency shall consult with Write
Your Own companies throughout the development of
guidance and rate tables necessary to implement the
provisions of and the amendments made by this Act.
(B) Implementation <<NOTE: Deadline.>> and
guidance.--The Administrator shall issue final guidance
and rate tables necessary to implement the provisions of
and the amendments made by this Act not later than eight
months following the date of the enactment of
this <<NOTE: Time period.>> Act. Write Your Own
companies, in coordination with the Federal Emergency
Management Agency, shall have not less than six months
but not more than eight months following the issuance of
such final guidance and rate tables to implement the
changes required by such final guidance and rate tables.
(4) Refund of excess premium charges collected.--The
Administrator shall refund directly to insureds any premiums for
flood insurance coverage under the National Flood Insurance
Program collected in excess of the rates required under the
provisions of and amendments made by this section. To allow for
necessary and appropriate implementation of such provisions and
amendments, any premium changes necessary to implement such
provisions and amendments, including any such premium refund due
to policy holders, which shall be paid directly by the National
Flood Insurance Program, shall not be charged or paid to
policyholders by the National Flood Insurance Program until
after the Administrator issues guidance and makes available such
rate tables to implement the provisions of and amendments made
by this Act.
(b) Assumption of Policies at Existing Premium Rates.--The
Administrator shall provide that the purchaser of a property that, as of
the date of such purchase, is covered under an existing flood insurance
policy under this title may assume such existing policy and coverage for
the remainder of the term of the policy
[[Page 128 STAT. 1022]]
at the chargeable premium rates under such existing policy. Such rates
shall continue with respect to such property until the implementation of
subsection (a).
SEC. 4. RESTORATION OF GRANDFATHERED RATES.
(a) In General.--Section 1308 of the National Flood Insurance Act of
1968 (42 U.S.C. 4015) is amended--
(1) by striking subsection (h); and
(2) by redesignating subsection (i) as subsection (h).
(b) <<NOTE: 42 USC 4015 note.>> Effective Date.--The amendments
made by subsection (a) shall take effect as if enacted as part of the
Biggert-Waters Flood Insurance Reform Act of 2012 (Public Law 112-141;
126 Stat. 957).
SEC. 5. REQUIREMENTS REGARDING ANNUAL RATE INCREASES.
Section 1308(e) of the National Flood Insurance Act of 1968 (42
U.S.C. 4015(e)) is amended--
(1) in the matter preceding paragraph (1), by striking ``,
the chargeable risk premium rates for flood insurance under this
title for any properties'';
(2) in paragraph (1), by inserting ``the chargeable risk
premium rates for flood insurance under this title for any
properties'' before ``within any'';
(3) in paragraph (2), by inserting ``the chargeable risk
premium rates for flood insurance under this title for any
properties'' before ``described in'';
(4) by redesignating paragraphs (1) and (2), as so amended,
as paragraphs (3) and (4), respectively; and
(5) by inserting before paragraph (3), as so redesignated,
the following new paragraphs:
``(1) the chargeable risk premium rate for flood insurance
under this title for any property may not be increased by more
than 18 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) <<NOTE: Time period.>> 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 of the average of the risk
premium rates for such properties within the risk classification
upon the commencement of such 12-month period;'';
[[Page 128 STAT. 1023]]
(6) in paragraph (3) (as so redesignated by paragraph (4) of
this section), by striking ``20 percent'' and inserting ``15
percent''; and
(7) in paragraph (4) (as so redesignated) by paragraph (4)
of this section), by striking ``paragraph (1)'' and inserting
``paragraph (3)''.
SEC. 6. CLARIFICATION OF RATES FOR PROPERTIES NEWLY MAPPED INTO
AREAS WITH SPECIAL FLOOD HAZARDS.
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:
``(i) Rates for Properties Newly Mapped Into Areas With Special
Flood Hazards.--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) 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) 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.''.
SEC. 7. PREMIUMS AND REPORTS.
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:
``(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.''.
SEC. 8. ANNUAL PREMIUM SURCHARGE.
(a) Premium Surcharge.--Chapter I of the National Flood Insurance
Act of 1968 (42 U.S.C. 4011 et seq.) is amended by inserting after
section 1308 the following new section:
``SEC. 1308A. <<NOTE: 42 USC 4015a.>> 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. Such surcharge shall be in addition to the
surcharge under section 1304(b) and any other assessments and surcharges
applied to such coverage.
[[Page 128 STAT. 1024]]
``(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.
``(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.''.
(b) Deposit in Reserve Fund.--Subsection (c) of section 1310A of the
National Flood Insurance Act of 1968 (42 U.S.C. 4017a) is amended by
adding at the end the following new paragraph:
``(4) Deposit of premium surcharges.--The Administrator
shall deposit in the Reserve Fund any surcharges collected
pursuant to section 1308A.''.
SEC. 9. DRAFT AFFORDABILITY FRAMEWORK.
(a) In General.--The Administrator shall prepare a draft
affordability framework that proposes to address, via programmatic and
regulatory changes, the issues of affordability of flood insurance sold
under the National Flood Insurance Program, including issues identified
in the affordability study required under section 100236 of the Bigger-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 Stat.
957).
(b) Criteria.--In carrying out the requirements under subsection
(a), the Administrator shall consider the following criteria:
(1) Accurate communication to consumers of the flood risk
associated with their properties.
(2) Targeted assistance to flood insurance policy holders
based on their financial ability to continue to participate in
the National Flood Insurance Program.
(3) Individual or community actions to mitigate the risk of
flood or lower the cost of flood insurance.
(4) The impact of increases in risk premium rates on
participation in the National Flood Insurance Program.
(5) The impact flood insurance rate map updates have on the
affordability of flood insurance.
(c) Deadline for Submission.--Not later than 18 months after the
date on which the Administrator submits the affordability study referred
to in subsection (a), the Administrator shall submit to the full
Committee on Banking, Housing, and Urban Affairs and the full Committee
on Appropriations of the Senate and the full Committee on Financial
Services and the full Committee on Appropriations of the House of
Representatives the draft affordability framework required under
subsection (a).
(d) Interagency Agreements.--The Administrator may enter into an
agreement with another Federal agency to--
(1) complete the affordability study referred to in
subsection (a); or
[[Page 128 STAT. 1025]]
(2) prepare the draft affordability framework required under
subsection (a).
(e) Rule of Construction.--Nothing in this section shall be
construed to provide the Administrator with the authority to provide
assistance to homeowners based on affordability that was not available
prior to the enactment of the Biggert-Waters Flood Insurance Reform Act
of 2012 (Public Law 112-141; 126 Stat. 916).
SEC. 10. RISK TRANSFER.
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:
``(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.''.
SEC. 11. MONTHLY INSTALLMENT PAYMENT FOR PREMIUMS.
(a) In General.--Subsection (g) of section 1308 of the National
Flood Insurance Act of 1968 (42 U.S.C. 4015(g)) is amended by striking
``either annually or in more frequent installments'' and inserting
``annually or monthly''.
(b) <<NOTE: 42 USC 4015 note.>> Implementation.--The Administrator
shall implement the requirement under section 1308(g) of the National
Flood Insurance Act of 1968, as amended by subsection (a), not later
than the expiration of the 18-month period beginning on the date of the
enactment of this Act.
SEC. 12. OPTIONAL HIGH-DEDUCTIBLE POLICIES FOR RESIDENTIAL
PROPERTIES.
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:
``(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.''.
[[Page 128 STAT. 1026]]
SEC. 13. EXCLUSION OF DETACHED STRUCTURES FROM MANDATORY PURCHASE
REQUIREMENT.
(a) Exclusion.--Subsection (c) of section 102 of the Flood Disaster
Protection Act of 1973 (42 U.S.C. 4012a(c)) is amended by adding at the
end the following new paragraph:
``(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.''.
(b) RESPA Statement.--Section 5(b) of the Real Estate Settlement
Procedures Act of 1974 (12 U.S.C. 2604(b)) is amended--
(1) in paragraph (14), by inserting before the period at the
end the following: ``, and the following statement: `Although
you may not be required to maintain flood insurance on all
structures, you may still wish to do so, and your mortgage
lender may still require you to do so to protect the collateral
securing the mortgage. If you choose to not maintain flood
insurance on a structure, and it floods, you are responsible for
all flood losses relating to that structure.' ''; and
(2) by transferring and inserting paragraph (14), as so
amended, after paragraph (13).
SEC. 14. ACCOUNTING FOR FLOOD MITIGATION ACTIVITIES IN 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 to read as
follows:
``(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''.
SEC. 15. HOME IMPROVEMENT FAIRNESS.
Section 1307(a)(2)(E)(ii) of the National Flood Insurance Act of
1968 (42 U.S.C. 4014(a)(2)(E)(ii)) is amended by striking ``30 percent''
and inserting ``50 percent''.
SEC. 16. AFFORDABILITY STUDY AND REPORT.
(a) Study Issues.--Subsection (a) of section 100236 of the Biggert-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 Stat.
957) is amended--
(1) in paragraph (3), by striking ``and'' at the end;
(2) in paragraph (4), by striking the period at the end and
inserting a semicolon; and
(3) by adding at the end the following new paragraphs:
``(5) options for maintaining affordability if annual
premiums for flood insurance coverage were to increase to an
amount greater than 2 percent of the liability coverage amount
under the policy, including options for enhanced mitigation
assistance and means-tested assistance;
[[Page 128 STAT. 1027]]
``(6) the effects that the establishment of catastrophe
savings accounts would have regarding long-term affordability of
flood insurance coverage; and
``(7) options for modifying the surcharge under 1308A,
including based on homeowner income, property value or risk of
loss.''.
(b) <<NOTE: Deadline.>> Timing of Submission.--Notwithstanding the
deadline under section 100236(c) of the Biggert-Waters Flood Insurance
Reform Act of 2012 (Public Law 112-141; 126 Stat. 957), not later than
18 months after the date of enactment of this Act, the Administrator
shall submit to the full Committee on Banking, Housing, and Urban
Affairs and the full Committee on Appropriations of the Senate and the
full Committee on Financial Services and the full Committee on
Appropriations of the House of Representatives the affordability study
and report required under such section 100236.
(c) Affordability Study Funding.--Section 100236(d) of the Biggert-
Waters Flood Insurance Reform Act of 2012 (Public Law 112-141; 126 Stat.
957) is amended by striking ``$750,000'' and inserting ``$2,500,000''.
SEC. 17. <<NOTE: 42 USC 4101d.>> FLOOD INSURANCE RATE MAP
CERTIFICATION.
The <<NOTE: Reports.>> Administrator shall implement a flood mapping
program for the National Flood Insurance Program, only after review by
the Technical Mapping Advisory Council, that, when applied, results in
technically credible flood hazard data in all areas where Flood
Insurance Rate Maps are prepared or updated, shall certify in writing to
the Congress when such a program has been implemented, and shall provide
to the Congress the Technical Mapping Advisory Council review report.
SEC. 18. FUNDS TO REIMBURSE HOMEOWNERS FOR SUCCESSFUL MAP APPEALS.
(a) In General.--Section 1363(f) of the National Flood Insurance Act
of 1968 (42 U.S.C. 4104(f)) is amended--
(1) in the first sentence, by inserting after ``as the case
may be,'' the following: ``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,''; and
(2) by striking the second sentence and inserting the
following: ``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.''.
(b) Conforming Amendments.--Section 1310(a) of the National Flood
Insurance Act of 1968 (42 U.S.C. 4017(a)) is amended--
(1) in paragraph (6), by striking ``and'' at the end;
(2) in paragraph (7), by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(8) for carrying out section 1363(f).''.
SEC. 19. FLOOD PROTECTION SYSTEMS.
(a) Adequate Progress on Construction of Flood Protection Systems.--
Section 1307(e) of the National Flood Insurance Act of 1968 (42 U.S.C.
4014(e)) is amended--
[[Page 128 STAT. 1028]]
(1) in the first sentence, by inserting ``or
reconstruction'' after ``construction'';
(2) by amending the second sentence to read as follows:
``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.''; and
(3) by adding at the end the following: ``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.''.
(b) Communities Restoring Disaccredited Flood Protection Systems.--
Section 1307(f) of the National Flood Insurance Act of 1968 (42 U.S.C.
4014(f)) is amended by amending the first sentence to read
as <<NOTE: Applicability.>> follows: ``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.''.
SEC. 20. QUARTERLY REPORTS REGARDING RESERVE FUND RATIO.
Subsection (e) of section 1310A of the National Flood Insurance Act
of 1968 (42 U.S.C. 4017a) is amended, in the matter preceding paragraph
(1), by inserting ``, on a calendar quarterly basis,'' after ``submit''.
SEC. 21. <<NOTE: 42 USC 4012a note.>> TREATMENT OF FLOODPROOFED
RESIDENTIAL BASEMENTS.
The Administrator shall continue to extend exceptions and variances
for flood-proofed basements consistent with section 60.6 of title 44,
Code of Federal Regulations, which are effective April 3, 2009; and
section 60.3 of such title, which are effective April 3, 2009.
SEC. 22. <<NOTE: 42 USC 4101e.>> EXEMPTION FROM FEES FOR CERTAIN
MAP CHANGE REQUESTS.
Notwithstanding any other provision of law, a requester shall be
exempt from submitting a review or processing fee for a request for a
flood insurance rate map change based on a habitat restoration project
that is funded in whole or in part with Federal or State funds,
including dam removal, culvert redesign or installation, or the
installation of fish passage.
SEC. 23. STUDY OF VOLUNTARY COMMUNITY-BASED FLOOD INSURANCE
OPTIONS.
(a) Study.--
(1) Study required.--The Administrator shall conduct a study
to assess options, methods, and strategies for making
[[Page 128 STAT. 1029]]
available voluntary community-based flood insurance policies
through the National Flood Insurance Program.
(2) Considerations.--The study conducted under paragraph (1)
shall--
(A) take into consideration and analyze how
voluntary community-based flood insurance policies--
(i) would affect communities having varying
economic bases, geographic locations, flood hazard
characteristics or classifications, and flood
management approaches; and
(ii) could satisfy the applicable requirements
under section 102 of the Flood Disaster Protection
Act of 1973 (42 U.S.C. 4012a); and
(B) evaluate the advisability of making available
voluntary community-based flood insurance policies to
communities, subdivisions of communities, and areas of
residual risk.
(3) Consultation.--In conducting the study required under
paragraph (1), the Administrator may consult with the
Comptroller General of the United States, as the Administrator
determines is appropriate.
(b) Report by the Administrator.--
(1) Report required.--Not later than 18 months after the
date of enactment of this Act, the Administrator shall submit to
the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of
Representatives a report that contains the results and
conclusions of the study conducted under subsection (a).
(2) Contents.--The report submitted under paragraph (1)
shall include recommendations for--
(A) the best manner to incorporate voluntary
community-based flood insurance policies into the
National Flood Insurance Program; and
(B) a strategy to implement voluntary community-
based flood insurance policies that would encourage
communities to undertake flood mitigation activities,
including the construction, reconstruction, or
improvement of levees, dams, or other flood control
structures.
(c) Report by Comptroller General.--Not later than 6 months after
the date on which the Administrator submits the report required under
subsection (b), the Comptroller General of the United States shall--
(1) review the report submitted by the Administrator; and
(2) submit to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services of
the House of Representatives a report that contains--
(A) an analysis of the report submitted by the
Administrator;
(B) any comments or recommendations of the
Comptroller General relating to the report submitted by
the Administrator; and
(C) any other recommendations of the Comptroller
General relating to community-based flood insurance
policies.
[[Page 128 STAT. 1030]]
SEC. 24. <<NOTE: 42 USC 4033.>> DESIGNATION OF FLOOD INSURANCE
ADVOCATE.
(a) In General.--The Administrator shall designate a Flood Insurance
Advocate to advocate for the fair treatment of policy holders under the
National Flood Insurance Program and property owners in the mapping of
flood hazards, the identification of risks from flood, and the
implementation of measures to minimize the risk of flood.
(b) Duties and Responsibilities.--The duties and responsibilities of
the Flood Insurance Advocate designated under subsection (a) shall be
to--
(1) educate property owners and policyholders under the
National Flood Insurance Program on--
(A) individual flood risks;
(B) flood mitigation;
(C) measures to reduce flood insurance rates through
effective mitigation;
(D) the flood insurance rate map review and
amendment process; and
(E) any changes in the flood insurance program as a
result of any newly enacted laws (including this Act);
(2) assist policy holders under the National Flood Insurance
Program and property owners to understand the procedural
requirements related to appealing preliminary flood insurance
rate maps and implementing measures to mitigate evolving flood
risks;
(3) assist in the development of regional capacity to
respond to individual constituent concerns about flood insurance
rate map amendments and revisions;
(4) coordinate outreach and education with local officials
and community leaders in areas impacted by proposed flood
insurance rate map amendments and revisions; and
(5) aid potential policy holders under the National Flood
Insurance Program in obtaining and verifying accurate and
reliable flood insurance rate information when purchasing or
renewing a flood insurance policy.
SEC. 25. EXCEPTIONS TO ESCROW REQUIREMENT FOR FLOOD INSURANCE
PAYMENTS.
(a) In General.--Section 102(d)(1) of the Flood Disaster Protection
Act of 1973 (42 U.S.C. 4012a(d)(1)) is amended--
(1) in subparagraph (A), in the second sentence, by striking
``subparagraph (C)'' and inserting ``subparagraph (B)''; and
(2) in subparagraph (B)--
(A) in clause (ii), by redesignating subclauses (I)
and (II) as items (aa) and (bb), respectively, and
adjusting the margins accordingly;
(B) by redesignating clauses (i) and (ii) as
subclauses (I) and (II), respectively, and adjusting the
margins accordingly;
(C) in the matter preceding subclause (I), as
redesignated by subparagraph (B), by striking ``(A) or
(B), if--'' and inserting the following: ``(A)--
``(i) if--'';
(D) by striking the period at the end and inserting
``; or''; and
(E) by adding at the end the following:
``(ii) in the case of a loan that--
[[Page 128 STAT. 1031]]
``(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.''.
(b) <<NOTE: 42 USC 4012a note.>> Applicability.--
(1) In general.--
(A) Required application.--The amendments to section
102(d)(1) of the Flood Disaster Protection Act of 1973
(42 U.S.C. 4012a(d)(1)) made by section 100209(a) of the
Biggert-Waters Flood Insurance Reform Act of 2012
(Public Law 112-141; 126 Stat. 920) and by subsection
(a) of this section shall apply to any loan that is
originated, refinanced, increased, extended, or renewed
on or after January 1, 2016.
(B) Optional application.--
(i) Definitions.--In this subparagraph--
(I) the terms ``Federal entity for
lending regulation'', ``improved real
estate'', ``regulated lending
institution'', and ``servicer'' have the
meanings given the terms in section 3 of
the Flood Disaster Protection Act of
1973 (42 U.S.C. 4003);
(II) the term ``outstanding loan''
means a loan that--
(aa) is outstanding as of
January 1, 2016;
(bb) is not subject to the
requirement to escrow premiums
and fees for flood insurance
under section 102(d)(1) of the
Flood Disaster Protection Act of
1973 (42 U.S.C. 4012a(d)(1)) as
in effect on July 5, 2012; and
(cc) would, if the loan had
been originated, refinanced,
increased, extended, or renewed
on or after January 1, 2016, be
subject to the requirements
under section 102(d)(1)(A)
[[Page 128 STAT. 1032]]
of the Flood Disaster Protection
Act of 1973, as amended; and
(III) the term ``section
102(d)(1)(A) of the Flood Disaster
Protection Act of 1973, as amended''
means section 102(d)(1)(A) of the Flood
Disaster Protection Act of 1973 (42
U.S.C. 4012a(d)(1)(A)), as amended by--
(aa) section 100209(a) of
the Biggert-Waters Flood
Insurance Reform Act of 2012
(Public Law 112-141; 126 Stat.
920); and
(bb) subsection (a) of this
section.
(ii) Option to escrow flood insurance
payments.--
Each <<NOTE: Consultation. Coordination. Regulation
.>> Federal entity for lending regulation (after
consultation and coordination with the Federal
Financial Institutions Examination Council) shall,
by regulation, direct that each regulated lending
institution or servicer of an outstanding loan
shall offer and make available to a borrower the
option to have the borrower's payment of premiums
and fees for flood insurance under the National
Flood Insurance Act of 1968 (42 U.S.C. 4001 et
seq.), including the escrow of such payments, be
treated in the same manner provided under section
102(d)(1)(A) of the Flood Disaster Protection Act
of 1973, as amended.
(2) Repeal of 2-year delay on applicability.--Subsection (b)
of section 100209 of the Biggert-Waters Flood Insurance Reform
Act of 2012 <<NOTE: 42 USC 4012a note.>> (Public Law 112-141;
126 Stat. 920) is repealed.
(3) <<NOTE: 42 USC 4012a note.>> Rule of construction.--
Nothing in this section or the amendments made by this section
shall be construed to supersede, during the period beginning on
July 6, 2012 and ending on December 31, 2015, the requirements
under section 102(d)(1) of the Flood Disaster Protection Act of
1973 (42 U.S.C. 4012a(d)(1)), as in effect on July 5, 2012.
SEC. 26. FLOOD MITIGATION METHODS FOR BUILDINGS.
(a) Guidelines.--
(1) In general.--Section 1361 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4102) is amended by adding at
the end the following new subsection:
``(d) Flood Mitigation Methods for Buildings.--The Administrator
shall establish guidelines for property owners that--
``(1) provide alternative methods of mitigation, other than
building elevation, to reduce flood risk to residential
buildings that cannot be elevated due to their structural
characteristics, including--
``(A) types of building materials; and
``(B) types of floodproofing; and
``(2) inform property owners about how the implementation of
mitigation methods described in paragraph (1) may affect risk
premium rates for flood insurance coverage under the National
Flood Insurance Program.''.
(2) <<NOTE: Deadline. Time period. 42 USC 4102 note.>>
Issuance.--The Administrator shall issue the guidelines required
under section 1361(d) of the National Flood Insurance Act of
1968 (42 U.S.C. 4102(d)), as added by the amendment made by
paragraph (1) of this subsection, not later
[[Page 128 STAT. 1033]]
than the expiration of the 1-year period beginning on the date
of the enactment of this Act.
(b) Calculation of Risk Premium Rates.--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:
``(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)).''.
SEC. 27. MAPPING OF NON-STRUCTURAL FLOOD MITIGATION FEATURES.
Section 100216 of the Biggert-Waters Flood Insurance Reform Act of
2012 (42 U.S.C. 4101b) is amended--
(1) in subsection (b)(1)(A)--
(A) in clause (iv), by striking ``and'' at the end;
(B) by redesignating clause (v) as clause (vi);
(C) by inserting after clause (iv) the following new
clause:
``(v) areas that are protected by non-
structural flood mitigation features; and''; and
(D) in clause (vi) (as so redesignated), by
inserting before the semicolon at the end the following:
``and by non-structural flood mitigation features''; and
(2) in subsection (d)(1)--
(A) by redesignating subparagraphs (A) through (C)
as subparagraphs (B) through (D), respectively;
(B) in subparagraph (C) (as so redesignated), by
striking ``subparagraph (A)'' and inserting
``subparagraph (B)''; and
(C) by inserting before subparagraph (B) (as so
redesignated) the following new subparagraph:
``(A) work with States, local communities, and
property owners to identify areas and features described
in subsection (b)(1)(A)(v);''.
SEC. 28. CLEAR COMMUNICATIONS.
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:
``(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.''.
SEC. 29. PROTECTION OF SMALL BUSINESSES, NON-PROFITS, HOUSES OF
WORSHIP, AND RESIDENCES.
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:
``(m) Protection of Small Businesses, Non-Profits, Houses of
Worship, and Residences.--
[[Page 128 STAT. 1034]]
``(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) <<NOTE: Determination. Deadline.>> 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.''.
SEC. 30. MAPPING.
Section 100216(d)(1) of the Biggert-Waters Flood Insurance Reform
Act of 2012 (42 U.S.C. 4101b(d)(1)), as amended by section 27 of this
Act, is further amended--
(1) in subparagraph (C)--
(A) by striking ``subparagraph (B)'' and inserting
``subparagraph (E)''; and
(B) by striking ``and'' at the end;
(2) by redesignating subparagraphs (A), (B), (C), and (D) as
subparagraphs (D), (E), (F), and (H), respectively;
(3) by inserting before subparagraph (D), as so
redesignated, the following new subparagraphs:
``(A) <<NOTE: Notification.>> 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) <<NOTE: Time period. Consultation.>> provide
each community affected a 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) <<NOTE: Records. Time period.>> upon
completion of the first Independent Data Submission,
transmit a copy of such Submission to the affected
community, provide the affected community a 30-day
period during which the community may provide data
[[Page 128 STAT. 1035]]
to Administrator that can be used to supplement or
modify the existing data, and incorporate any data that
is consistent with prevailing engineering principles;'';
and
(4) by inserting after subparagraph (F), as so redesignated,
the following new subparagraph:
``(G) <<NOTE: Deadline. Notification.>> 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''.
SEC. 31. DISCLOSURE.
(a) <<NOTE: Deadline. Public information. 42 USC 4014 note.>>
Changes in Rates Resulting From This Act.--Not later than the date that
is 6 months before the date on which any change in risk premium rates
for flood insurance coverage under the National Flood Insurance Program
resulting from this Act or any amendment made by this Act is
implemented, the Administrator shall make publicly available the rate
tables and underwriting guidelines that provide the basis for the
change.
(b) Report on Policy and Claims Data.--
(1) In general.--Not later than 90 days after the date of
enactment of this Act, the Administrator shall submit to the
Congress a report on the feasibility of--
(A) releasing property-level policy and claims data
for flood insurance coverage under the National Flood
Insurance Program; and
(B) establishing guidelines for releasing property-
level policy and claims data for flood insurance
coverage under the National Flood Insurance Program in
accordance with section 552a of title 5, United States
Code (commonly known as the Privacy Act of 1974).
(2) Contents.--The report submitted under paragraph (1)
shall include--
(A) an analysis and assessment of how releasing
property-level policy and claims data for flood
insurance coverage under the National Flood Insurance
Program will aid policy holders and insurers to
understand how the Administration determines actuarial
premium rates and assesses flood risks; and
[[Page 128 STAT. 1036]]
(B) recommendations for protecting personal
information in accordance with section 552a of title 5,
United States Code (commonly known as the Privacy Act of
1974).
Approved March 21, 2014.
LEGISLATIVE HISTORY--H.R. 3370:
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CONGRESSIONAL RECORD, Vol. 160 (2014):
Mar. 4, considered and passed House.
Mar. 13, considered and passed Senate.
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