[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2284 Placed on Calendar Senate (PCS)]
Calendar No. 460
110th CONGRESS
1st Session
S. 2284
[Report No. 110-214]
To amend the National Flood Insurance Act of 1968, to restore the
financial solvency of the flood insurance fund, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
November 1, 2007
Mr. Dodd, from the Committee on Banking, Housing, and Urban Affairs,
reported the following original bill; which was read twice and placed
on the calendar
_______________________________________________________________________
A BILL
To amend the National Flood Insurance Act of 1968, to restore the
financial solvency of the flood insurance fund, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title.--This Act may be cited as the ``Flood Insurance
Reform and Modernization Act of 2007''.
(b) Table of Contents.--The table of contents for this Act is as
follows:
Sec. 1. Short title; Table of contents.
Sec. 2. Findings.
Sec. 3. Definitions.
Sec. 4. Extension of National Flood Insurance Program.
Sec. 5. Availability of insurance for multifamily properties.
Sec. 6. Reform of premium rate structure.
Sec. 7. Mandatory coverage areas.
Sec. 8. Premium adjustment.
Sec. 9. State chartered financial institutions.
Sec. 10. Enforcement.
Sec. 11. Escrow of flood insurance payments.
Sec. 12. Borrowing authority debt forgiveness.
Sec. 13. Minimum deductibles for claims under the National Flood
Insurance Program.
Sec. 14. Considerations in determining chargeable premium rates.
Sec. 15. Reserve fund.
Sec. 16. Repayment plan for borrowing authority.
Sec. 17. Payment of condominium claims.
Sec. 18. Technical Mapping Advisory Council.
Sec. 19. National Flood Mapping Program.
Sec. 20. Removal of limitation on State contributions for updating
flood maps.
Sec. 21. Coordination.
Sec. 22. Interagency coordination study.
Sec. 23. Nonmandatory participation.
Sec. 24. Notice of flood insurance availability under RESPA.
Sec. 25. Testing of new floodproofing technologies.
Sec. 26. Participation in State disaster claims mediation programs.
Sec. 27. Reiteration of FEMA responsibilities under the 2004 Reform
Act.
Sec. 28. Additional authority of FEMA to collect information on claims
payments.
Sec. 29. Expense reimbursements of insurance companies.
Sec. 30. Extension of pilot program for mitigation of severe repetitive
loss properties.
Sec. 31. Flood insurance advocate.
Sec. 32. Studies and Reports.
SEC. 2. FINDINGS.
Congress finds that--
(1) the flood insurance claims resulting from the hurricane
season of 2005 will likely exceed all previous claims paid by
the National Flood Insurance Program;
(2) in order to pay the legitimate claims of policyholders
from the hurricane season of 2005, the Federal Emergency
Management Agency has borrowed over $20,000,000,000 from the
Treasury;
(3) the interest alone on this debt, is almost
$1,000,000,000 annually, and that the Federal Emergency
Management Agency has indicated that it will be unable to pay
back this debt;
(4) the flood insurance program must be strengthened to
ensure it can pay future claims;
(5) while flood insurance is mandatory in the 100-year
floodplain, substantial flooding occurs outside of existing
special flood hazard areas;
(6) recent events throughout the country involving areas
behind man-made structures, known as ``residual risk'' areas,
have produced catastrophic losses;
(7) although such man-made structures produce an added
element of safety and therefore lessen the probability that a
disaster will occur, they are nevertheless susceptible to
catastrophic loss, even though such areas at one time were not
included within the 100-year floodplain; and
(8) voluntary participation in the National Flood Insurance
Program has been minimal and many families residing outside the
100-year floodplain remain unaware of the potential risk to
their lives and property.
SEC. 3. DEFINITIONS.
(a) In General.--In this Act, the following definitions shall
apply:
(1) Director.--The term ``Director'' 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. 4011 et
seq.).
(3) 100-year floodplain.--The term ``100-year floodplain''
means that area which is subject to inundation from a flood
having a 1 percent chance of being equaled or exceeded in any
given year.
(4) 500-year floodplain.--The term ``500-year floodplain''
means that area which is subject to inundation from a flood
having a 0.2 percent chance of being equaled or exceeded in any
given year.
(5) Write your own.--The term ``Write Your Own'' means the
cooperative undertaking between the insurance industry and the
Flood Insurance Administration which allows participating
property and casualty insurance companies to write and service
standard flood insurance policies.
(b) Common Terminology.--Except as otherwise provided in this Act,
any terms used in this Act shall have the meaning given to such terms
under section 1370 of the National Flood Insurance Act of 1968 (42
U.S.C. 4121).
SEC. 4. EXTENSION OF NATIONAL FLOOD INSURANCE PROGRAM.
Section 1319 of the National Flood Insurance Act of 1968 (42 U.S.C.
4026), is amended by striking ``2008'' and inserting ``2013.''.
SEC. 5. AVAILABILITY OF INSURANCE FOR MULTIFAMILY PROPERTIES.
Section 1305 of the National Flood Insurance Act of 1968 (42 U.S.C.
4012) is amended by adding at the end the following:
``(d) Availability of Insurance for Multifamily Properties.--
``(1) In general.--The Director shall make flood insurance
available to cover residential properties of more than 4 units.
Notwithstanding any other provision of law, the maximum
coverage amount that the Director 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 more than 4 units to obtain
insurance for the contents and personal articles located in
such residences.''.
SEC. 6. REFORM OF PREMIUM RATE STRUCTURE.
(a) To Exclude Certain Properties From Receiving Subsidized Premium
Rates.--
(1) In general.--Section 1307 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4014) is amended--
(A) in subsection (a)--
(i) in paragraph (2), by striking ``; and''
and inserting a semicolon;
(ii) in paragraph (3), by striking the
period at the end and inserting ``; and''; and
(iii) by adding at the end the following:
``(4) the exclusion of prospective insureds from purchasing
flood insurance at rates less than those estimated under
paragraph (1), as required by paragraph (2), for certain
properties, including for--
``(A) any property which is not the primary
residence of an individual;
``(B) any severe repetitive loss property, as
defined in section 1361A(b);
``(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;
``(D) any business property; and
``(E) any property which on or after the date of
enactment of the Flood Insurance Reform and
Modernization Act of 2007 has experienced or
sustained--
``(i) substantial damage exceeding 50
percent of the fair market value of such
property; or
``(ii) substantial improvement exceeding 30
percent of the fair market value of such
property.''; and
(B) by adding at the end the following:
``(g) No Extension of Subsidy to New Policies or Lapsed Policies.--
The Director 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 property not insured by the flood insurance
program as of the date of enactment of the Flood Insurance
Reform and Modernization Act of 2007; and
``(2) any policy under the flood insurance program that has
lapsed in coverage, as a result of the deliberate choice of the
holder of such policy.''.
(2) Effective date.--The amendments made by paragraph (1)
shall become effective 90 days after the date of the enactment
of this Act.
(b) Increase in 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) by striking ``under this title for any properties
within any single'' and inserting the following: ``under this
title for any properties--
``(1) within any single''; and
(2) by striking ``10 percent'' and inserting ``15
percent''; and
(3) by striking the period at the end and inserting the
following: ``; and
``(2) described in section 1307(a)(4) 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 (1).''.
SEC. 7. MANDATORY COVERAGE AREAS.
(a) Special Flood Hazard Areas.--Not later than 90 days after the
date of enactment of this Act, the Director shall issue final
regulations establishing a revised definition of areas of special flood
hazards for purposes of the National Flood Insurance Program.
(b) Residual Risk Areas.--The regulations required by subsection
(a) shall--
(1) include any area previously identified by the Director
as an area having special flood hazards under section 102 of
the Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a);
and
(2) require the expansion of areas of special flood hazards
to include areas of residual risk, including areas that are
located behind levees, dams, and other man-made structures.
(c) Mandatory Participation in National Flood Insurance Program.--
(1) In general.--Any area described in subsection (b) shall
be subject to the mandatory purchase requirements of sections
102 and 202 of the Flood Disaster Protection Act of 1973 (42
U.S.C. 4012a, 4106).
(2) Limitation.--The mandatory purchase requirement under
paragraph (1) shall have no force or effect until the mapping
of all residual risk areas in the United States that the
Director determines essential in order to administer the
National Flood Insurance Program, as required under section 19,
are in the maintenance phase.
SEC. 8. PREMIUM ADJUSTMENT.
Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C.
4015) is amended by adding at the end the following:
``(g) Premium Adjustment To Reflect Current Risk of Flood.--
Notwithstanding subsection (f), and upon completion of the updating of
any flood insurance rate map under this Act, the Flood Disaster
Protection Act of 1973, or the Flood Insurance Reform and Modernization
Act of 2007, any property located in an area that is participating in
the national flood insurance program shall have the risk premium rate
charged for flood insurance on such property adjusted to accurately
reflect the current risk of flood to such property, subject to any
other provision of this Act. Any increase in the risk premium rate
charged for flood insurance on any property that is covered by a flood
insurance policy on the date of completion of such updating or
remapping that is a result of such updating or remapping shall be
phased in over a 2-year period at the rate of 50 percent per year.''.
SEC. 9. STATE CHARTERED FINANCIAL INSTITUTIONS.
Section 1305(c) of the National Flood Insurance Act of 1968 (42
U.S.C. 4012(c)) is amended--
(1) in paragraph (1), by striking ``; and'' and inserting a
semicolon;
(2) in paragraph (2), by striking the period at the end and
inserting ``; and''; and
(3) by adding at the end the following:
``(3) given satisfactory assurance that by December 31,
2008, lending institutions chartered by a State, and not
insured by the Federal Deposit Insurance Corporation, shall be
subject to regulations by that State that are consistent with
the requirements of section 102 of the Flood Disaster
Protection Act of 1973 (42 U.S.C. 4012a).''.
SEC. 10. ENFORCEMENT.
Section 102(f)(5) of the Flood Disaster Protection Act of 1973 (42
U.S.C. 4012a(f)(5)) is amended--
(1) in the first sentence, by striking ``$350'' and
inserting ``$2,000''; and
(2) by striking the second sentence.
SEC. 11. ESCROW OF FLOOD INSURANCE PAYMENTS.
(a) In General.--Section 102(d) of the Flood Disaster Protection
Act of 1973 (42 U.S.C. 4012a(d)) is amended--
(1) by amending paragraph (1) to read as follows:
``(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 any premiums and fees
for flood insurance under the National Flood Insurance
Act of 1968, on any property for which a loan has been
made for acquisition or construction purposes, shall be
paid to the mortgage lender, with the same frequency as
payments on the loan are made, for the duration of the
loan. Upon receipt of any premiums or fees, the lender
shall deposit such premiums and fees in an escrow
account on behalf of the borrower. Upon receipt of a
notice from the Director or the provider of the flood
insurance that insurance premiums are due, the
remaining balance of an escrow account shall be paid to
the provider of the flood insurance.
``(B) State entities responsible for lending
regulations.--In order to continue to participate in
the flood insurance program, each State shall direct
that its entity or agency with primary responsibility
for the supervision of lending institutions in that
State require that premiums and fees for flood
insurance under the National Flood Insurance Act of
1968, on any property for which a loan has been made
for acquisition or construction purposes shall be paid
to the mortgage lender, with the same frequency as
payments on the loan are made, for the duration of the
loan. Upon receipt of any premiums or fees, the lender
shall deposit such premiums and fees in an escrow
account on behalf of the borrower. Upon receipt of a
notice from such State entity or agency, the Director,
or the provider of the flood insurance that insurance
premiums are due, the remaining balance of an escrow
account shall be paid to the provider of the flood
insurance.''; and
(2) by adding at the end the following:
``(6) Notice upon loan termination.--Upon final payment of
the mortgage, a regulated lending institution shall provide
notice to the policyholder that insurance coverage may cease
with such final payment. The regulated lending institution
shall also provide direction as to how the homeowner may
continue flood insurance coverage after the life of the
loan.''.
(b) Applicability.--The amendment made by subsection (a)(1) shall
apply to any mortgage outstanding or entered into on or after the
expiration of the 2-year period beginning on the date of enactment of
this Act.
SEC. 12. BORROWING AUTHORITY DEBT FORGIVENESS.
(a) In General.--The Secretary of the Treasury relinquishes the
right to any repayment of amounts due from the Director in connection
with the exercise of the authority vested to the Director to borrow
such sums under section 1309 of the National Flood Insurance Act of
1968 (42 U.S.C. 4016), to the extent such borrowed sums were used to
fund the payment of flood insurance claims under the National Flood
Insurance Program for any damage to or loss of property resulting from
the hurricanes of 2005.
(b) Certification.--The debt forgiveness described under subsection
(a) shall only take effect if the Director certifies to the Secretary
of Treasury that all authorized resources or funds available to the
Director to operate the National Flood Insurance Program--
(1) have been otherwise obligated to pay claims under the
National Flood Insurance Program; and
(2) are not otherwise available to make payments to the
Secretary on any outstanding notes or obligations issued by the
Director and held by the Secretary.
(c) Decrease in Borrowing Authority.--The first sentence of
subsection (a) of section 1309 of the National Flood Insurance Act of
1968 (42 U.S.C. 4016(a)) is amended by striking ``; except that,
through September 30, 2008, clause (2) of this sentence shall be
applied by substituting `$20,775,000,000' for `$ 1,500,000,000'''.
SEC. 13. MINIMUM DEDUCTIBLES FOR CLAIMS UNDER THE NATIONAL FLOOD
INSURANCE PROGRAM.
Section 1312 of the National Flood Insurance Act of 1968 (42 U.S.C.
4019) is amended--
(1) by striking ``The Director is'' and inserting the
following:
``(a) In General.--The Director is''; and
(2) by adding at the end the following:
``(b) 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 Director 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 Director under section 1360
for the area in which such structure is located, the minimum
annual deductible for damage to such structure shall be--
``(A) $750, 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) $1,000, if the flood insurance coverage for
such structure covers loss of, or physical damage to,
such structure in an amount greater than $100,000.''.
SEC. 14. CONSIDERATIONS IN DETERMINING CHARGEABLE PREMIUM RATES.
Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C.
4015(b)) is amended--
(1) in subsection (a), by striking ``, after consultation
with'' and all that follows through ``by regulation'' and
inserting ``prescribe, after providing notice'';
(2) in subsection (b)--
(A) in paragraph (1), by striking the period at the
end and inserting a semicolon;
(B) in paragraph (2), by striking the comma at the
end and inserting a semicolon;
(C) in paragraph (3), by striking ``, and'' and
inserting a semicolon;
(D) in paragraph (4), by striking the period and
inserting ``; and''; and
(E) by adding at the end the following:
``(5) adequate, on the basis of accepted actuarial
principles, to cover the average historical loss year
obligations incurred by the National Flood Insurance Fund.'';
and
(3) by adding at the end the following:
``(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.''.
SEC. 15. RESERVE FUND.
Chapter I of the National Flood Insurance Act of 1968 (42 U.S.C.
4011 et seq.) is amended by inserting after section 1310 the following:
``SEC. 1310A. RESERVE FUND.
``(a) Establishment of Reserve Fund.--In carrying out the flood
insurance program authorized by this chapter, the Director 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 Director; and
``(2) be available for meeting the expected future
obligations of the flood insurance program.
``(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 Director 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 Director 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 Director 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 Director determines
appropriate.
``(3) Limitations.--In exercising the authority granted
under paragraph (1), the Director shall be subject to all other
provisions of this Act, including any provisions relating to
chargeable premium rates or annual increases of such rates.
``(d) Phase-In Requirements.--The phase-in requirements under this
subsection are as follows:
``(1) In general.--Beginning in fiscal year 2008 and not
ending until the fiscal year in which the ratio required under
subsection (b) is achieved, in each such fiscal year the
Director shall place in the Reserve Fund an amount equal to not
less than 7.5 percent of the reserve ratio required under
subsection (b).
``(2) Amount satisfied.--As soon as the ratio required
under subsection (b) is achieved, and except as provided in
paragraph (3), the Director shall not be required to set aside
any amounts for the Reserve Fund.
``(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 Director 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).
``(e) Limitation on Reserve Ratio.--In any given fiscal year, if
the Director determines that the reserve ratio required under
subsection (b) cannot be achieved, the Director shall submit a report
to Congress that--
``(1) describes and details the specific concerns of the
Director regarding such consequences;
``(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.''.
SEC. 16. REPAYMENT PLAN FOR BORROWING AUTHORITY.
Section 1309 of the National Flood Insurance Act of 1968 (42 U.S.C.
4016) is amended by adding at the end the following:
``(c) Any funds borrowed by the Director under the authority
established in subsection (a) shall include a schedule for repayment of
such amounts which shall be transmitted to the--
``(1) Secretary of the Treasury;
``(2) Committee on Banking, Housing, and Urban Affairs of
the Senate; and
``(3) Committee on Financial Services of the House of
Representatives.
``(d) In addition to the requirement under subsection (c), in
connection with any funds borrowed by the Director under the authority
established in subsection (a), the Director, beginning 6 months after
the date on which such borrowed funds are issued, and continuing every
6 months thereafter until such borrowed funds are fully repaid, shall
submit a report on the progress of such repayment to the--
``(1) Secretary of the Treasury;
``(2) Committee on Banking, Housing, and Urban Affairs of
the Senate; and
``(3) Committee on Financial Services of the House of
Representatives.''.
SEC. 17. PAYMENT OF CONDOMINIUM CLAIMS.
Section 1312 of the National Flood Insurance Act of 1968 (42 U.S.C.
4019), as amended by section 13, is further amended by adding at the
end the following:
``(c) Payment of Claims to Condominium Owners.--The Director 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. Notwithstanding any regulations, rules, or restrictions
established by the Director relating to appeals and filing deadlines,
the Director shall ensure that the requirements of this subsection are
met with respect to any claims for damages resulting from flooding in
2005 and 2006.''.
SEC. 18. TECHNICAL MAPPING ADVISORY COUNCIL.
(a) Establishment.--There is established a council to be known as
the Technical Mapping Advisory Council (in this section referred to as
the ``Council'').
(b) Membership.--
(1) In general.--The Council shall consist of the Director,
or the designee thereof, and 12 additional members to be
appointed by the Director or the designee of the Director, who
shall be--
(A) the Under Secretary of Commerce for Oceans and
Atmosphere (or the designee thereof);
(B) a member of a recognized professional surveying
association or organization
(C) a member of a recognized professional mapping
association or organization;
(D) a member of a recognized professional
engineering association or organization;
(E) a member of a recognized professional
association or organization representing flood hazard
determination firms;
(F) a representative of the United States
Geological Survey;
(G) a representative of a recognized professional
association or organization representing State
geographic information;
(H) a representative of State national flood
insurance coordination offices;
(I) a representative of the Corps of Engineers;
(J) the Secretary of the Interior (or the designee
thereof);
(K) the Secretary of Agriculture (or the designee
thereof); and
(L) a member of a recognized regional flood and
storm water management organization.
(2) Qualifications.--Members of the Council shall be
appointed based on their demonstrated knowledge and competence
regarding surveying, cartography, remote sensing, geographic
information systems, or the technical aspects of preparing and
using flood insurance rate maps.
(c) Duties.--The Council shall--
(1) recommend to the Director how to improve in a cost-
effective manner the--
(A) accuracy, general quality, ease of use, and
distribution and dissemination of flood insurance rate
maps and risk data; and
(B) performance metrics and milestones required to
effectively and efficiently map flood risk areas in the
United States;
(2) recommend to the Director mapping standards and
guidelines for--
(A) flood insurance rate maps; and
(B) data accuracy, data quality, data currency,
and data eligibility;
(3) recommend to the Director how to maintain on an ongoing
basis flood insurance rate maps and flood risk identification;
(4) recommend procedures for delegating mapping activities
to State and local mapping partners;
(5) recommend to the Director and other Federal agencies
participating in the Council--
(A) methods for improving interagency and
intergovernmental coordination on flood mapping and
flood risk determination; and
(B) a funding strategy to leverage and coordinate
budgets and expenditures across Federal agencies; and
(6) submit an annual report to the Director that contains--
(A) a description of the activities of the Council;
(B) an evaluation of the status and performance of
flood insurance rate maps and mapping activities to
revise and update flood insurance rate maps, as
required under section 19; and
(C) a summary of recommendations made by the
Council to the Director.
(d) Future Conditions Risk Assessment and Modeling Report.--
(1) In general.--The Council shall consult with scientists
and technical experts, other Federal agencies, States, and
local communities to--
(A) develop recommendations on how to--
(i) ensure that flood insurance rate maps
incorporate the best available climate science
to assess flood risks; and
(ii) ensure that the Federal Emergency
Management Agency uses the best available
methodology to consider the impact of--
(I) the rise in the sea level; and
(II) future development on flood
risk; and
(B) not later than 1 year after the date of
enactment of this Act, prepare written recommendations
in a future conditions risk assessment and modeling
report and to submit such recommendations to the
Director.
(2) Responsibility of the director.--The Director, as part
of the ongoing program to review and update National Flood
Insurance Program rate maps under section 19, shall incorporate
any future risk assessment submitted under paragraph (1)(B) in
any such revision or update.
(e) Chairperson.--The members of the Council shall elect 1 member
to serve as the chairperson of the Council (in this section referred to
as the ``Chairperson'').
(f) Coordination.--To ensure that the Council's recommendations are
consistent, to the maximum extent practicable, with national digital
spatial data collection and management standards, the Chairperson shall
consult with the Chairperson of the Federal Geographic Data Committee
(established pursuant to OMB Circular A-16).
(g) Compensation.--Members of the Council shall receive no
additional compensation by reason of their service on the Council.
(h) Meetings and Actions.--
(1) In general.--The Council shall meet not less frequently
than twice each year at the request of the Chairperson or a
majority of its members, and may take action by a vote of the
majority of the members.
(2) Initial meeting.--The Director, or a person designated
by the Director, shall request and coordinate the initial
meeting of the Council.
(i) Officers.--The Chairperson may appoint officers to assist in
carrying out the duties of the Council under subsection (c).
(j) Staff.--
(1) Staff of fema.--Upon the request of the Chairperson,
the Director may detail, on a nonreimbursable basis, personnel
of the Federal Emergency Management Agency to assist the
Council in carrying out its duties.
(2) Staff of other federal agencies.--Upon request of the
Chairperson, any other Federal agency that is a member of the
Council may detail, on a non-reimbursable basis, personnel to
assist the Council in carrying out its duties.
(k) Powers.--In carrying out this section, the Council may hold
hearings, receive evidence and assistance, provide information, and
conduct research, as it considers appropriate.
(l) Report to Congress.--The Director, on an annual basis, shall
report to the Committee on Banking, Housing, and Urban Affairs of the
Senate, the Committee on Financial Services of the House of
Representatives, and the Office of Management and Budget on the--
(1) recommendations made by the Council; and
(2) actions taken by the Federal Emergency Management
Agency to address such recommendations to improve flood
insurance rate maps and flood risk data.
SEC. 19. NATIONAL FLOOD MAPPING PROGRAM.
(a) Reviewing, Updating, and Maintaining Maps.--The Director, in
coordination with the Technical Mapping Advisory Council established
under section 18, shall establish an ongoing program under which the
Director 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 Director shall--
(A) identify, review, update, maintain, and publish
National Flood Insurance Program rate maps with respect
to--
(i) all areas located within the 100-year
floodplain;
(ii) all areas located within the 500-year
floodplain;
(iii) areas of residual risk that have not
previously been identified, including areas
that are protected levees, dams, and other man-
made structures; and
(iv) areas that could be inundated as a
result of the failure of a levee, dam, or other
man-made structure;
(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, the most
accurate topography and elevation data available.
(2) Mapping elements.--Each map updated under this section
shall:
(A) Ground elevation data.--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 the existing
guidelines and specifications of the Federal Emergency
Management Agency.
(B) Data on a watershed basis.--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 Director 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 Director;
(C) any relevant information on land subsidence,
coastal erosion areas, and other floor-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 climate science and the potential for future
inundation from sea level rise, increased
precipitation, and increased intensity of hurricanes
due to global warming; and
(E) 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 Director 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
Director, in conjunction with State and local
governments, in developing maps for communities with
similar flood risks, as determined by the Director; 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) compliant with the North American Vertical
Datum of 1998 for New Hydrologic and Hydraulic
Engineering.
(d) Authorization of Appropriations.--There is authorized to be
appropriated to the Director to carry out this section $400,000,000 for
each of fiscal years 2008 through 2013.
SEC. 20. REMOVAL OF LIMITATION ON STATE CONTRIBUTIONS FOR UPDATING
FLOOD MAPS.
Section 1360(f)(2) of the National Flood Insurance Act of 1968 (42
U.S.C. 4101(f)(2)) is amended by striking ``, but which may not exceed
50 percent of the cost of carrying out the requested revision or
update''.
SEC. 21. COORDINATION.
(a) Interagency Budget Crosscut Report.--
(1) In general.--The Secretary of Homeland Security, the
Director, the Director of the Office of Management and Budget,
and the heads of each Federal department or agency carrying out
activities under sections 18 and 19 shall work together to
ensure that flood risk determination data and geospatial data
are shared among Federal agencies in order to coordinate the
efforts of the Nation to reduce its vulnerability to flooding
hazards.
(2) Report.--Not later than 30 days after the submission of
the budget of the United States Government by the President to
Congress, the Director of the Office of Management and Budget,
in coordination with the Federal Emergency Management Agency,
the United States Geological Survey, the National Oceanic and
Atmospheric Administration, the Corps of Engineers, and other
Federal agencies, as appropriate, shall submit to the
appropriate authorizing and appropriating committees of the
Senate and the House of Representatives a financial report,
certified by the Secretary or head of each such agency, an
interagency budget crosscut report that displays the budget
proposed for each of the Federal agencies working on flood risk
determination data and digital elevation models, including any
planned interagency or intraagency transfers.
(b) Duties of the Director.--In carrying out sections 18 and 19,
the Director shall--
(1) participate, pursuant to section 216 of Public Law 107-
347 (116 Stat. 2945), in the establishment of such standards
and common protocols as are necessary to assure the
interoperability of geospatial data for all users of such
information;
(2) coordinate with, seek assistance and cooperation of,
and provide liaison to the Federal Geographic Data Committee
pursuant to Office of Management and Budget Circular A-16 and
Executive Order 12906 for the implementation of and compliance
with such standards;
(3) integrate with, leverage, and coordinate funding of, to
the maximum extent practicable, the current flood mapping
activities of each unit of State and local government;
(4) integrate with, leverage, and coordinate, to the
maximum extent practicable, the current geospatial activities
of other Federal agencies and units of State and local
government; and
(5) develop a funding strategy to leverage and coordinate
budgets and expenditures, and to establish joint funding
mechanisms with other Federal agencies and units of State and
local government to share the collection and utilization of
geospatial data among all governmental users.
SEC. 22. INTERAGENCY COORDINATION STUDY.
(a) In General.--The Director shall enter into a contract with the
National Academy of Public Administration to conduct a study on how the
Federal Emergency Management Agency--
(1) should improve interagency and intergovernmental
coordination on flood mapping, including a funding strategy to
leverage and coordinate budgets and expenditures; and
(2) can establish joint funding mechanisms with other
Federal agencies and units of State and local government to
share the collection and utilization of data among all
governmental users.
(b) Timing.--Not later than 180 days after the date of enactment of
this Act, the National Academy of Public Administration shall report
the findings of the study required under subsection (a) to the--
(1) Committee on Banking, Housing, and Urban Affairs of the
Senate;
(2) Committee on Financial Services of the House of
Representatives;
(3) Committee on Appropriations of the Senate; and
(4) Committee on Appropriations of the House of
Representatives.
SEC. 23. NONMANDATORY PARTICIPATION.
(a) Nonmandatory Participation in National Flood Insurance Program
for 500-Year Floodplain.--Any area located within the 500-year
floodplain shall not be subject to the mandatory purchase requirements
of sections 102 or 202 of the Flood Disaster Protection Act of 1973 (42
U.S.C. 4012a, 4106).
(b) Notice.--
(1) By director.--In carrying out the National Flood
Insurance Program, the Director shall provide notice to any
community located in an area within the 500-year floodplain.
(2) Timing of notice.--The notice required under paragraph
(1) shall be made not later than 6 months after the date of
completion of the initial mapping of the 500-year floodplain,
as required under section 18.
(3) Lender required notice.--
(A) Regulated lending institutions.--Each Federal
or State entity for lending regulation (after
consultation and coordination with the Federal
Financial Institutions Examination Council) shall, by
regulation, require regulated lending institutions, as
a condition of making, increasing, extending, or
renewing any loan secured by property located in an
area within the 500-year floodplain, to notify the
purchaser or lessee (or obtain satisfactory assurances
that the seller or lessor has notified the purchaser or
lessee) and the servicer of the loan that such property
is located in an area within the 500-year floodplain,
in a manner that is consistent with and substantially
identical to the notice required under section
1364(a)(1) of the National Flood Insurance Act of 1968
(42 U.S.C. 4104a(a)(1)).
(B) Federal or state agency lenders.--Each Federal
or State agency lender shall, by regulation, require
notification in the same manner as provided under
subparagraph (A) with respect to any loan that is made
by a Federal or State agency lender and secured by
property located in an area within the 500-year
floodplain.
(C) Penalty for noncompliance.--Any regulated
lending institution or Federal or State agency lender
that fails to comply with the notice requirements
established by this paragraph shall be subject to the
penalties prescribed under section 102(f)(5) of the
Flood Disaster Protection Act of 1973 (42 U.S.C.
4012a(f)(5)).
SEC. 24. NOTICE OF FLOOD INSURANCE AVAILABILITY UNDER RESPA.
Section 5(b) of the Real Estate Settlement Procedures Act of 1974
(12 U.S.C. 2604(b)) is amended--
(1) in paragraph (4), by striking ``; and'' and inserting a
semicolon;
(2) in paragraph (5), by striking the period and inserting
``; and''; and
(3) by adding at the end the following:
``(6) an explanation of flood insurance and the
availability of flood insurance under the National Flood
Insurance Program, whether or not the real estate is located in
an area having special flood hazards.''.
SEC. 25. TESTING OF NEW FLOODPROOFING TECHNOLOGIES.
(a) Permissible Testing.--A temporary residential structure built
for the purpose of testing a new flood proofing technology, as
described in subsection (b), in any State or community that receives
mitigation assistance under section 1366 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4104c) may not be construed to be in
violation of any flood risk mitigation plan developed by that State or
community and approved by the Director of the Federal Emergency
Management Agency.
(b) Conditions on Testing.--Testing permitted under subsection (a)
shall--
(1) be performed on an uninhabited residential structure;
(2) require dismantling of the structure at the conclusion
of such testing; and
(3) require that all costs associated with such testing and
dismantling be covered by the individual or entity conducting
the testing, or on whose behalf the testing is conducted.
(c) Rule of Construction.--Nothing in this section shall be
construed to alter, limit, or extend the availability of flood
insurance to any structure that may employ, utilize, or apply any
technology tested under subsection (b).
SEC. 26. PARTICIPATION IN STATE DISASTER CLAIMS MEDIATION PROGRAMS.
Chapter I of the National Flood Insurance Act of 1968 (42 U.S.C.
4011 et seq.) is amended by inserting after section 1313 the following:
``SEC. 1314. PARTICIPATION IN STATE DISASTER CLAIMS MEDIATION PROGRAMS.
``(a) Requirement to Participate.--In the case of the occurrence of
a major disaster, as defined in section 102 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122) that may
have resulted in flood damage under the flood insurance program
established under this chapter and other personal lines residential
property insurance coverage offered by a State regulated insurer, upon
request made by the insurance commissioner of a State (or such other
official responsible for regulating the business of insurance in the
State) for the participation of representatives of the Director in a
program sponsored by such State for nonbinding mediation of insurance
claims resulting from a major disaster, the Director shall cause
representatives of the flood insurance program to participate in such a
State program where claims under the flood insurance program are
involved to expedite settlement of flood damage claims resulting from
such disaster.
``(b) Extent of Participation.--In satisfying the requirements of
subsection (a), the Director shall require that each representative of
the Director--
``(1) be certified for purposes of the flood insurance
program to settle claims against such program resulting from
such disaster in amounts up to the limits of policies under
such program;
``(2) attend State-sponsored mediation meetings regarding
flood insurance claims resulting from such disaster at such
times and places as may be arranged by the State;
``(3) participate in good faith negotiations toward the
settlement of such claims with policyholders of coverage made
available under the flood insurance program; and
``(4) finalize the settlement of such claims on behalf of
the flood insurance program with such policyholders.
``(c) Coordination.--Representatives of the Director shall at all
times coordinate their activities with insurance officials of the State
and representatives of insurers for the purposes of consolidating and
expediting settlement of claims under the national flood insurance
program resulting from such disaster.
``(d) Qualifications of Mediators.--Each State mediator
participating in State-sponsored mediation under this section shall
be--
``(1)(A) a member in good standing of the State bar in the
State in which the mediation is to occur with at least 2 years
of practical experience; and
``(B) an active member of such bar for at least 1 year
prior to the year in which such mediator's participation is
sought; or
``(2) a retired trial judge from any United States
jurisdiction who was a member in good standing of the bar in
the State in which the judge presided for at least 5 years
prior to the year in which such mediator's participation is
sought.
``(e) Mediation Proceedings and Documents Privileged.--As a
condition of participation, all statements made and documents produced
pursuant to State-sponsored mediation involving representatives of the
Director shall be deemed privileged and confidential settlement
negotiations made in anticipation of litigation.
``(f) Liability, Rights, or Obligations Not Affected.--
Participation in State-sponsored mediation, as described in this
section does not--
``(1) affect or expand the liability of any party in
contract or in tort; or
``(2) affect the rights or obligations of the parties, as
established--
``(A) in any regulation issued by the Director,
including any regulation relating to a standard flood
insurance policy;
``(B) under this Act; and
``(C) under any other provision of Federal law.
``(g) Exclusive Federal Jurisdiction.--Participation in State-
sponsored mediation shall not alter, change, or modify the original
exclusive jurisdiction of United States courts, as set forth in this
Act.
``(h) Cost Limitation.--Nothing in this section shall be construed
to require the Director or a representative of the Director to pay
additional mediation fees relating to flood insurance claims associated
with a State-sponsored mediation program in which such representative
of the Director participates.
``(i) Exception.--In the case of the occurrence of a major disaster
that results in flood damage claims under the national flood insurance
program and that does not result in any loss covered by a personal
lines residential property insurance policy--
``(1) this section shall not apply; and
``(2) the provisions of the standard flood insurance policy
under the national flood insurance program and the appeals
process established under section 205 of the Bunning-Bereuter-
Blumenauer Flood Insurance Reform Act of 2004 (42 U.S.C. 4011
note) and the regulations issued pursuant to such section shall
apply exclusively.
``(j) Representatives of the Director.--For purposes of this
section, the term `representatives of the Director' means
representatives of the national flood insurance program who participate
in the appeals process established under section 205 of the Bunning-
Bereuter-Blumenauer Flood Insurance Reform Act of 2004 (42 U.S.C. 4011
note).''.
SEC. 27. REITERATION OF FEMA RESPONSIBILITIES UNDER THE 2004 REFORM
ACT.
(a) Minimum Training and Education Requirements.--The Director
shall continue to work with the insurance industry, State insurance
regulators, and other interested parties to implement the minimum
training and education standards for all insurance agents who sell
flood insurance policies, as such standards were determined by the
Director in the notice published in the Federal Register on September
1, 2005 (70 Fed. Reg. 52117) pursuant to section 207 of the Bunning-
Bereuter-Blumenauer Flood Insurance Reform Act of 2004 (42 U.S.C. 4011
note).
(b) Report on the Overall Implementation of the Reform Act of
2004.--Not later than 3 months after the date of the enactment of this
Act, the Director shall submit a report to Congress--
(1) describing the implementation of each provision of the
Bunning-Bereuter-Blumenauer Flood Insurance Reform Act of 2004
(Public Law 108-264; 118 Stat. 712);
(2) identifying each regulation, order, notice, and other
material issued by the Director in implementing each provision
of that Act;
(3) explaining any statutory or implied deadlines that have
not been met; and
(4) providing an estimate of when the requirements of such
missed deadlines will be fulfilled.
SEC. 28. ADDITIONAL AUTHORITY OF FEMA TO COLLECT INFORMATION ON CLAIMS
PAYMENTS.
(a) In General.--The Director shall collect, from property and
casualty insurance companies that are authorized by the Director to
participate in the Write Your Own program any information and data
needed to determine the accuracy of the resolution of flood claims
filed on any property insured with a standard flood insurance policy
obtained under the program that was subject to a flood.
(b) Type of Information To Be Collected.--The information and data
to be collected under subsection (a) may include--
(1) any adjuster estimates made as a result of flood
damage, and if the insurance company also insures the property
for wind damage--
(A) any adjuster estimates for both wind and flood
damage;
(B) the amount paid to the property owner for wind
and flood claims;
(C) the total amount paid to the policyholder for
damages as a result of the event that caused the
flooding and other losses;
(2) any amounts paid to the policyholder by the insurance
company for damages to the insured property other than flood
damages; and
(3) the total amount paid to the policyholder by the
insurance company for all damages incurred to the insured
property as a result of the flood.
SEC. 29. EXPENSE REIMBURSEMENTS OF INSURANCE COMPANIES.
(a) Submission of Biennial Reports.--
(1) To the director.--Not later than 20 days after the date
of enactment of this Act, each property and casualty insurance
company that is authorized by the Director to participate in
the Write Your Own program shall submit to the Director any
biennial report prepared in the prior 5 years by such company.
(2) To gao.--Not later than 10 days after the submission of
the biennial reports under paragraph (1), the Director shall
submit all such reports to the Comptroller General of the
United States.
(3) Notice to congress of failure to comply.--The Director
shall notify and report to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on Financial
Services of the House of Representatives on any property and
casualty insurance company participating in the Write Your Own
program that failed to submit its biennial reports as required
under paragraph (1).
(b) FEMA Rulemaking on Expenses of WYO Program.--Not later than 180
days after the date of enactment of this Act, the Director shall
conduct a rulemaking proceeding to devise a data collection methodology
to allow the Federal Emergency Management Agency to collect consistent
information on the expenses (including the operating and administrative
expenses for adjustment of claims) of property and casualty insurance
companies participating in the Write Your Own program for selling,
writing, and servicing, standard flood insurance policies.
(c) Submission of Expense Reports.--Not later than 60 days after
the effective date of the final rule established pursuant to subsection
(b), each property and casualty insurance company participating in the
Write Your Own program shall submit a report to the Director that
details for the prior 5 years the expense levels of each such company
for selling, writing, and servicing standard flood insurance policies
based on the methodologies established under subsection (b).
(d) FEMA Rulemaking on Reimbursement of Expenses Under the WYO
Program.--Not later than 15 months after the date of enactment of this
Act, the Director shall conduct a rulemaking proceeding to formulate
revised expense reimbursements to property and casualty insurance
companies participating in the Write Your Own program for their
expenses (including their operating and administrative expenses for
adjustment of claims) in selling, writing, and servicing standard flood
insurance policies, including how such companies shall be reimbursed in
both catastrophic and non-catastrophic years. Such reimbursements shall
be structured to ensure reimbursements track the actual expenses,
including standard business costs and operating expenses, of such
companies as close as practicably possible.
(e) Report of the Director.--Not later than 60 days after the
effective date of any final rule established pursuant to subsection (b)
or subsection (d), the Director 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
containing--
(1) the specific rationale and purposes of such rule;
(2) the reasons for the adoption of the policies contained
in such rule; and
(3) the degree to which such rule accurately represents the
true operating costs and expenses of property and casualty
insurance companies participating in the Write Your Own
program.
(f) GAO Study and Report on Expenses of WYO Program.--
(1) Study.--Not later than 180 days after the effective
date of the final rule established pursuant to subsection (d),
the Comptroller General of the United States shall--
(A) conduct a study on the efficacy, adequacy, and
sufficiency of the final rules established pursuant to
subsections (b) and (d); and
(B) report to the Committee on Banking, Housing,
and Urban Affairs of the Senate and the Committee on
Financial Services of the House of Representatives on
the findings of the study conducted under subparagraph
(A).
(2) GAO authority.--In conducting the study and report
required under paragraph (1), the Comptroller General--
(A) may use any previous findings, studies, or
reports that the Comptroller General previously
completed on the Write Your Own program;
(B) shall determine if--
(i) the final rules established pursuant to
subsections (b) and (d) allow the Federal
Emergency Management Agency to access adequate
information regarding the actual expenses of
property and casualty insurance companies
participating in the Write Your Own program;
and
(ii) the actual reimbursements paid out
under the final rule established in subsection
(d) accurately reflect the expenses reported by
property and casualty insurance companies
participating in the Write Your Own program,
including the standard business costs and
operating expenses of such companies; and
(C) shall analyze the effect of such rules on the
level of participation of property and casualty
insurers in the Write Your Own program.
SEC. 30. EXTENSION OF PILOT PROGRAM FOR MITIGATION OF SEVERE REPETITIVE
LOSS PROPERTIES.
(a) In General.--Section 1361A of the National Flood Insurance Act
of 1968 (42 U.S.C. 4102a) is amended--
(1) in subsection (k)(1)--
(A) in the first sentence, by striking ``in each of
fiscal years 2005, 2006, 2007, 2008, and 2009'' and
inserting ``in each fiscal year through fiscal year
2013''; and
(B) by adding at the end the following new
sentence: ``For fiscal years 2008 through the 2013, the
total amount that the Director may use to provide
assistance under this section shall not exceed
$240,000,000.''; and
(2) by striking subsection (l).
(b) Report to Congress on Implementation Status.--Not later than 6
months after the date of enactment of this Act, the Director shall
report to the Committee on Banking, Housing, and Urban Affairs of the
Senate and the Committee on Financial Services of the House of
Representatives on the status of the implementation of the pilot
program for severe repetitive loss properties authorized under section
1361A of the National Flood Insurance Act of 1968 (42 U.S.C. 4102a).
(c) Rulemaking.--No later than 90 days after the date of enactment
of this Act, the Director shall issue final rules to carry out the
severe repetitive loss pilot program authorized under section 1361A of
the National Flood Insurance Act of 1968 (42 U.S.C. 4102a).
SEC. 31. FLOOD INSURANCE ADVOCATE.
Chapter II of the National Flood Insurance Act of 1968 is amended
by inserting after section 1330 (42 U.S.C. 4041) the following new
section:
``SEC. 1330A. OFFICE OF THE FLOOD INSURANCE ADVOCATE.
``(a) Establishment of Position.--
``(1) In general.--There shall be in the Federal Emergency
Management Agency an Office of the Flood Insurance Advocate
which shall be headed by the National Flood Insurance Advocate.
The National Flood Insurance Advocate shall report directly to
the Director and shall, to the extent amounts are provided
pursuant to subsection (f), be compensated at the same rate as
the highest rate of basic pay established for the Senior
Executive Service under section 5382 of title 5, United States
Code, or, if the Director so determines, at a rate fixed under
section 9503 of such title.
``(2) Appointment.--The National Flood Insurance Advocate
shall be appointed by the Director and the flood insurance
advisory committee established pursuant to section 1318 and
without regard to the provisions of title 5, United States
Code, relating to appointments in the competitive service or
the Senior Executive Service.
``(3) Qualifications.--An individual appointed under
paragraph (2) shall have--
``(A) a background in customer service as well as
insurance; and
``(B) experience in representing individual
insureds.
``(4) Restriction on employment.--An individual may be
appointed as the National Flood Insurance Advocate only if such
individual was not an officer or employee of the Federal
Emergency Management Agency with duties relating to the
national flood insurance program during the 2-year period
ending with such appointment and such individual agrees not to
accept any employment with the Federal Emergency Management
Agency for at least 2 years after ceasing to be the National
Flood Insurance Advocate. Service as an employee of the
National Flood Insurance Advocate shall not be taken into
account in applying this paragraph.
``(5) Staff.--To the extent amounts are provided pursuant
to subsection (f), the National Flood Insurance Advocate may
employ such personnel as may be necessary to carry out the
duties of the Office.
``(b) Functions of Office.--
``(1) In general.--It shall be the function of the Office
of the Flood Insurance Advocate to--
``(A) assist insureds under the national flood
insurance program in resolving problems with the
Federal Emergency Management Agency relating to such
program;
``(B) identify areas in which such insureds have
problems in dealings with the Federal Emergency
Management Agency relating to such program;
``(C) propose changes in the administrative
practices of the Federal Emergency Management Agency to
mitigate problems identified under subparagraph (B);
and
``(D) identify potential legislative,
administrative, or regulatory changes which may be
appropriate to mitigate such problems.
``(2) Annual reports.--
``(A) Activities.--Not later than December 31 of
each calendar year, the National Flood Insurance
Advocate shall report to the Committee on Banking,
Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives on the activities of the Office of the
Flood Insurance Advocate during the fiscal year ending
during such calendar year. Any such report shall
contain a full and substantive analysis of such
activities, in addition to statistical information, and
shall--
``(i) identify the initiatives the Office
of the Flood Insurance Advocate has taken on
improving services for insureds under the
national flood insurance program and
responsiveness of the Federal Emergency
Management Agency with respect to such
initiatives;
``(ii) describe the nature of
recommendations made to the Director under
subsection (e);
``(iii) contain a summary of the most
serious problems encountered by such insureds,
including a description of the nature of such
problems;
``(iv) contain an inventory of any items
described in clauses (i), (ii), and (iii) for
which action has been taken and the result of
such action;
``(v) contain an inventory of any items
described in clauses (i), (ii), and (iii) for
which action remains to be completed and the
period during which each item has remained on
such inventory;
``(vi) contain an inventory of any items
described in clauses (i), (ii), and (iii) for
which no action has been taken, the period
during which each item has remained on such
inventory and the reasons for the inaction;
``(vii) identify any Flood Insurance
Assistance Recommendation which was not
responded to by the Director in a timely manner
or was not followed, as specified under
subsection (e);
``(viii) contain recommendations for such
administrative and legislative action as may be
appropriate to resolve problems encountered by
such insureds;
``(ix) identify areas of the law or
regulations relating to the national flood
insurance program that impose significant
compliance burdens on such insureds or the
Federal Emergency Management Agency, including
specific recommendations for remedying these
problems;
``(x) identify the most litigated issues
for each category of such insureds, including
recommendations for mitigating such disputes;
and
``(xi) include such other information as
the National Flood Insurance Advocate may deem
advisable.
``(B) Direct submission of report.--Each report
required under this paragraph shall be provided
directly to the committees identified in subparagraph
(A) without any prior review or comment from the
Director, the Secretary of Homeland Security, or any
other officer or employee of the Federal Emergency
Management Agency or the Department of Homeland
Security, or the Office of Management and Budget.
``(3) Other responsibilities.--The National Flood Insurance
Advocate shall--
``(A) monitor the coverage and geographic
allocation of regional offices of flood insurance
advocates;
``(B) develop guidance to be distributed to all
Federal Emergency Management Agency officers and
employees having duties with respect to the national
flood insurance program, outlining the criteria for
referral of inquiries by insureds under such program to
regional offices of flood insurance advocates;
``(C) ensure that the local telephone number for
each regional office of the flood insurance advocate is
published and available to such insureds served by the
office; and
``(D) establish temporary State or local offices
where necessary to meet the needs of qualified insureds
following a flood event.
``(4) Personnel actions.--
``(A) In general.--The National Flood Insurance
Advocate shall have the responsibility and authority
to--
``(i) appoint regional flood insurance
advocates in a manner that will provide
appropriate coverage based upon regional flood
insurance program participation; and
``(ii) hire, evaluate, and take personnel
actions (including dismissal) with respect to
any employee of any regional office of a flood
insurance advocate described in clause (i).
``(B) Consultation.--The National Flood Insurance
Advocate may consult with the appropriate supervisory
personnel of the Federal Emergency Management Agency in
carrying out the National Flood Insurance Advocate's
responsibilities under this paragraph.
``(c) Responsibilities of Director.--The Director shall establish
procedures requiring a formal response consistent with the requirements
of subsection (e)(3) to all recommendations submitted to the Director
by the National Flood Insurance Advocate.
``(d) Operation of Regional Offices.--
``(1) In general.--Each regional flood insurance advocate
appointed pursuant to subsection (b)--
``(A) shall report to the National Flood Insurance
Advocate or delegate thereof;
``(B) may consult with the appropriate supervisory
personnel of the Federal Emergency Management Agency
regarding the daily operation of the regional office of
the flood insurance advocate;
``(C) shall, at the initial meeting with any
insured under the national flood insurance program
seeking the assistance of a regional office of the
flood insurance advocate, notify such insured that the
flood insurance advocate offices operate independently
of any other Federal Emergency Management Agency office
and report directly to Congress through the National
Flood Insurance Advocate; and
``(D) may, at the flood insurance advocate's
discretion, not disclose to the Director contact with,
or information provided by, such insured.
``(2) Maintenance of independent communications.--Each
regional office of the flood insurance advocate shall maintain
a separate phone, facsimile, and other electronic communication
access.
``(e) Flood Insurance Assistance Recommendations.--
``(1) Authority to issue.--Upon application filed by a
qualified insured with the Office of the Flood Insurance
Advocate (in such form, manner, and at such time as the
Director shall by regulation prescribe), the National Flood
Insurance Advocate may issue a Flood Insurance Assistance
Recommendation, if the Advocate finds that the qualified
insured is suffering a significant hardship, such as a
significant delay in resolving claims where the insured is
incurring significant costs as a result of such delay, or where
the insured is at risk of adverse action, including the loss of
property, as a result of the manner in which the flood
insurance laws are being administered by the Director.
``(2) Terms of a flood insurance assistance
recommendation.--The terms of a Flood Insurance Assistance
Recommendation may recommend to the Director that the Director,
within a specified time period, cease any action, take any
action as permitted by law, or refrain from taking any action,
including the payment of claims, with respect to the qualified
insured under any other provision of law which is specifically
described by the National Flood Insurance Advocate in such
recommendation.
``(3) Director response.--Not later than 15 days after the
receipt of any Flood Insurance Assistance Recommendation under
this subsection, the Director shall respond in writing as to--
``(A) whether such recommendation was followed;
``(B) why such recommendation was or was not
followed; and
``(C) what, if any, additional actions were taken
by the Director to prevent the hardship indicated in
such recommendation.
``(4) Definitions.--For purposes of this subsection:
``(A) National flood insurance advocate.--The term
`National Flood Insurance Advocate' includes any
designee of the National Flood Insurance Advocate.
``(B) Qualified insured.--The term `qualified
insured' means an insured under coverage provided under
the national flood insurance program under this title.
``(f) Funding.--Pursuant to section 1310(a)(8), the Director may
use amounts from the National Flood Insurance Fund to fund the
activities of the Office of the Flood Advocate in each of fiscal years
2008 through 2013, except that the amount so used in each such fiscal
year may not exceed $5,000,000 and shall remain available until
expended. Notwithstanding any other provision of this title, amounts
made available pursuant to this subsection shall not be subject to
offsetting collections through premium rates for flood insurance
coverage under this title.''.
SEC. 32. STUDIES AND REPORTS.
(a) Report on Expanding the National Flood Insurance Program.--Not
later than 1 year after the date of the enactment of this Act, the
Comptroller General of the United States shall conduct a study and
submit a report to the Committee on Banking, Housing, and Urban Affairs
of the Senate and the Committee on Financial Services of the House of
Representatives, on--
(1) the number of flood insurance policy holders currently
insuring--
(A) a residential structure up to the maximum
available coverage amount, as established in section
61.6 of title 44, Code of Federal Regulations, of--
(i) $250,000 for the structure; and
(ii) $100,000 for the contents of such
structure; or
(B) a commercial structure up to the maximum
available coverage amount, as established in section
61.6 of title 44, Code of Federal Regulations, of
$500,000;
(2) the increased losses the National Flood Insurance
Program would have sustained during the 2004 and 2005 hurricane
season if the National Flood Insurance Program had insured all
policyholders up to the maximum conforming loan limit for
fiscal year 2006 of $417,000, as established under section
302(b)(2) of the Federal National Mortgage Association Charter
Act (12 U.S.C. 1717(b)(2));
(3) the availability in the private marketplace of flood
insurance coverage in amounts that exceed the current limits of
coverage amounts established in section 61.6 of title 44, Code
of Federal Regulations; and
(4) what effect, if any--
(A) raising the current limits of coverage amounts
established in section 61.6 of title 44, Code of
Federal Regulations, would have on the ability of
private insurers to continue providing flood insurance
coverage; and
(B) reducing the current limits of coverage amounts
established in section 61.6 of title 44, Code of
Federal Regulations, would have on the ability of
private insurers to provide sufficient flood insurance
coverage to effectively replace the current level of
flood insurance coverage being provided under the
National Flood Insurance Program.
(b) Report of the Director on Activities Under the National Flood
Insurance Program.--
(1) In general.--The Director shall, on an annual basis,
submit a full report on the operations, activities, budget,
receipts, and expenditures of the National Flood Insurance
Program for the preceding 12-month period to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of
Representatives.
(2) Timing.--Each report required under paragraph (1) shall
be submitted to the committees described in paragraph (1) not
later than 3 months following the end of each fiscal year.
(3) Contents.--Each report required under paragraph (1)
shall include--
(A) the current financial condition and income
statement of the National Flood Insurance Fund
established under section 1310 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4017), including--
(i) premiums paid into such Fund;
(ii) policy claims against such Fund; and
(iii) expenses in administering such Fund;
(B) the number and face value of all policies
issued under the National Flood Insurance Program that
are in force;
(C) a description and summary of the losses
attributable to repetitive loss structures;
(D) a description and summary of all losses
incurred by the National Flood Insurance Program due
to--
(i) hurricane related damage; and
(ii) nonhurricane related damage;
(E) the amounts made available by the Director for
mitigation assistance under section 1366(e)(5) of the
National Flood Insurance Act of 1968 (42 U.S.C.
4104c(e)(5)) for the purchase of properties
substantially damaged by flood for that fiscal year,
and the actual number of flood damaged properties
purchased and the total cost expended to purchase such
properties;
(F) the estimate of the Director as to the average
historical loss year, and the basis for that estimate;
(G) the estimate of the Director as to the maximum
amount of claims that the National Flood Insurance
Program would have to expend in the event of a
catastrophic year;
(H) the average--
(i) amount of insurance carried per flood
insurance policy;
(ii) premium per flood insurance policy;
and
(iii) loss per flood insurance policy; and
(I) the number of claims involving damages in
excess of the maximum amount of flood insurance
available under the National Flood Insurance Program
and the sum of the amount of all damages in excess of
such amount.
(c) GAO Study on Pre-FIRM Structures.--Not later than 1 year after
the date of the enactment of this Act, the Comptroller General of the
United States shall conduct a study and submit a report to the
Committee on Banking, Housing, and Urban Affairs of the Senate and the
Committee on Financial Services of the House of Representatives, on
the--
(1) composition of the remaining pre-FIRM structures that
are explicitly receiving discounted premium rates under section
1307 of the National Flood Insurance Act of 1968 (42 U.S.C.
4104), including the historical basis for the receipt of such
subsidy and whether such subsidy has outlasted its purpose;
(2) number and fair market value of such structures;
(3) respective income level of each owner of such
structure;
(4) number of times each such structure has been sold since
1968, including specific dates, sales price, and any other
information the Secretary determines appropriate;
(5) total losses incurred by such structures since the
establishment of the National Flood Insurance Program compared
to the total losses incurred by all structures that are charged
a nondiscounted premium rate;
(6) total cost of foregone premiums since the establishment
of the National Flood Insurance Program, as a result of the
subsidies provided to such structures;
(7) annual cost to the taxpayer, as a result of the
subsidies provided to such structures;
(8) the premium income collected and the losses incurred by
the National Flood Insurance Program as a result of such
explicitly subsidized structures compared to the premium income
collected and the losses incurred by such Program as result of
structures that are charged a nondiscounted premium rate, on a
State-by-State basis; and
(9) the most efficient way to eliminate the subsidy to such
structures.
(d) GAO Review of FEMA Contractors.--The Comptroller General of the
United States, in conjunction with the Department of Homeland
Security's Inspectors general Office, shall--
(1) conduct a review of the 3 largest contractors the
Director uses in administering the National Flood Insurance
Program; and
(2) not later than 18 months after the date of enactment of
this Act, submit a report on the findings of such review to the
Director, the Committee on Banking, Housing, and Urban Affairs
of the Senate, and the Committee on Financial Services of the
House of Representatives.
Calendar No. 460
110th CONGRESS
1st Session
S. 2284
[Report No. 110-214]
_______________________________________________________________________
A BILL
To amend the National Flood Insurance Act of 1968, to restore the
financial solvency of the flood insurance fund, and for other purposes.
_______________________________________________________________________
November 1, 2007
Read twice and placed on the calendar