To make technical and conforming amendments.

This amendment's own text couldn't be picked out of its Congressional Record passage, so the passage is shown in full.

FLOOD INSURANCE REFORM ACT OF 2004

  Mr. WARNER. Mr. President, I ask unanimous consent that the Senate
proceed to the immediate consideration of Calendar 513, S. 2238.
  The PRESIDING OFFICER. The clerk will report the bill by title.
  The legislative clerk read as follows:

       A bill (S. 2238) to amend the National Flood Insurance Act
     of 1968 to reduce losses to properties for which repetitive
     flood insurance claim payments have been made.

  There being no objection, the Senate proceeded to consider the bill
which was reported by the Committee on Banking, Housing, and Urban
Affairs, with amendments, as follows:
  [Strike the parts shown in black brackets and insert the parts shown
in italic.]

                                S. 2238

       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 Act of 2004''.
       (b) Table of Contents.--The table of contents for this Act
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Congressional findings.

           TITLE I--AMENDMENTS TO FLOOD INSURANCE ACT OF 1968

Sec. 101. Extension of program and consolidation of authorizations.
Sec. 102. Establishment of pilot program for mitigation of severe
              repetitive loss properties.
Sec. 103. Amendments to existing flood mitigation assistance program.
Sec. 104. FEMA authority to fund mitigation activities for individual
              repetitive claims properties.
Sec. 105. Amendments to additional coverage for compliance with land
              use and control measures.
Sec. 106. Actuarial rate properties.
Sec. 107. Geospatial digital flood hazard data.
Sec. 108. Replacement of mobile homes on original sites.
Sec. 109. Reiteration of FEMA responsibility to map mudslides.

                   TITLE II--MISCELLANEOUS PROVISIONS

Sec. 201. Definitions.
Sec. 202. Supplemental forms.
Sec. 203. Acknowledgement form.
Sec. 204. Flood insurance claims handbook.
Sec. 205. Appeal of decisions relating to flood insurance coverage.
Sec. 206. Study and report on use of cost compliance coverage.
Sec. 207. Minimum training and education requirements.
Sec. 208. GAO study and report.
Sec. 209. Prospective payment of flood insurance premiums.
Sec. 210. Report on changes to fee schedule or fee payment
              arrangements.

     SEC. 2. CONGRESSIONAL FINDINGS.

       The Congress finds that--
       (1) the national flood insurance program--
       (A) identifies the flood risk;
       (B) provides flood risk information to the public;
       (C) encourages State and local governments to make
     appropriate land use adjustments to constrict the development
     of land

[[Page S6810]]

     which is exposed to flood damage and minimize damage caused
     by flood losses; and
       (D) makes flood insurance available on a nationwide basis
     that would otherwise not be available, to accelerate recovery
     from floods, mitigate future losses, save lives, and reduce
     the personal and national costs of flood disasters;
       (2) the national flood insurance program insures
     approximately 4,400,000 policyholders;
       (3) approximately 48,000 properties currently insured under
     the program have experienced, within a 10-year period, 2 or
     more flood losses where each such loss exceeds the amount
     $1,000;
       (4) approximately 10,000 of these repetitive-loss
     properties have experienced either 2 or 3 losses that
     cumulatively exceed building value or 4 or more losses, each
     exceeding $1,000;
       (5) repetitive-loss properties constitute a significant
     drain on the resources of the national flood insurance
     program, costing about $200,000,000 annually;
       (6) repetitive-loss properties comprise approximately 1
     percent of currently insured properties but are expected to
     account for 25 to 30 percent of claims losses;
       (7) the vast majority of repetitive-loss properties were
     built before local community implementation of floodplain
     management standards under the program and thus are eligible
     for subsidized flood insurance;
       (8) while some property owners take advantage of the
     program allowing subsidized flood insurance without requiring
     mitigation action, others are trapped in a vicious cycle of
     suffering flooding, then repairing flood damage, then
     suffering flooding, without the means to mitigate losses or
     move out of harm's way;
       (9) mitigation of repetitive-loss properties through
     buyouts, elevations, relocations, or flood-proofing will
     produce savings for policyholders under the program and for
     Federal taxpayers through reduced flood insurance losses and
     reduced Federal disaster assistance;
       (10) a strategy of making mitigation offers aimed at high-
     priority repetitive-loss properties and shifting more of the
     burden of recovery costs to property owners who choose to
     remain vulnerable to repetitive flood damage can encourage
     property owners to take appropriate actions that reduce loss
     of life and property damage and benefit the financial
     soundness of the program;
       (11) the method for addressing repetitive-loss properties
     should be flexible enough to take into consideration
     legitimate circumstances that may prevent an owner from
     taking a mitigation action; and
       (12) focusing the mitigation and buy-out of repetitive loss
     properties upon communities and property owners that choose
     to voluntarily participate in a mitigation and buy-out
     program will maximize the benefits of such a program, while
     minimizing any adverse impact on communities and property
     owners.

           TITLE I--AMENDMENTS TO FLOOD INSURANCE ACT OF 1968

     SEC. 101. EXTENSION OF PROGRAM AND CONSOLIDATION OF
                   AUTHORIZATIONS.

       (a) Borrowing Authority.--The first sentence of section
     1309(a) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4016(a)), is amended by striking ``through December''
     and all that follows through ``, and'' and inserting
     ``through the date specified in section 1319, and''.
       (b) Authority for Contracts.--Section 1319 of the National
     Flood Insurance Act of 1968 (42 U.S.C. 4026), is amended by
     striking ``after'' and all that follows and inserting
     ``after September 30, 2008.''.
       (c) Emergency Implementation.--Section 1336(a) of the
     National Flood Insurance Act of 1968 (42 U.S.C. 4056(a)), is
     amended by striking ``during the period'' and all that
     follows through ``in accordance'' and inserting ``during the
     period ending on the date specified in section 1319, in
     accordance''.
       (d) Authorization of Appropriations for Studies.--Section
     1376(c) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4127(c)), is amended by striking ``through'' and all
     that follows and inserting ``through the date specified in
     section 1319, for studies under this title.''.

     SEC. 102. ESTABLISHMENT OF PILOT PROGRAM FOR MITIGATION OF
                   SEVERE REPETITIVE LOSS PROPERTIES.

       (a) In General.--The National Flood Insurance Act of 1968
     is amended by inserting after section 1361 (42 U.S.C. 4102)
     the following:

     ``SEC. 1361A. PILOT PROGRAM FOR MITIGATION OF SEVERE
                   REPETITIVE LOSS PROPERTIES.

       ``(a) Authority.--To the extent amounts are made available
     for use under this section, the Director may, subject to the
     limitations of this section, provide financial assistance to
     States and communities for taking actions with respect to
     severe repetitive loss properties (as such term is defined in
     subsection (b)) to mitigate flood damage to such properties
     and losses to the National Flood Insurance Fund from such
     properties.
       ``(b) Severe Repetitive Loss Property.--For purposes of
     this section, the term `severe repetitive loss property' has
     the following meaning:
       ``(1) Single-family properties.--In the case of a property
     consisting of 1 to 4 residences, such term means a property
     that--
       ``(A) is covered under a contract for flood insurance made
     available under this title; and
       ``(B) has incurred flood-related damage--
       ``(i) for which 3 or more separate claims payments have
     been made under flood insurance coverage under this title,
     with the amount of each such claim exceeding $3,000, and with
     the cumulative amount of such claims payments exceeding
     $15,000; or
       ``(ii) for which at least 2 separate claims payments have
     been made under such coverage, with the cumulative amount of
     such claims exceeding the value of the property.
       ``(2) Multifamily properties.--In the case of a property
     consisting of 5 or more residences, such term shall have such
     meaning as the Director shall by regulation provide.
       ``(c) Eligible Activities.--Amounts provided under this
     section to a State or community may be used only for the
     following activities:
       ``(1) Mitigation activities.--To carry out mitigation
     activities that reduce flood damages to severe repetitive
     loss properties, including elevation, relocation, demolition,
     and floodproofing of structures, and minor physical localized
     flood control projects, and the demolition and rebuilding of
     properties to at least 1 foot above Base Flood Elevation or
     greater, if required by any local ordinance.
       ``(2) Purchase.--To purchase severe repetitive loss
     properties, subject to subsection (f).
       ``(d) Matching Requirement.--
       ``(1) In general.--Except as provided in paragraph (2), in
     any 1-year period the Director may not provide assistance
     under this section to a State or community in an amount
     exceeding 3 times the amount that the State or community
     certifies, as the Director shall require, that the State or
     community will contribute from non-Federal funds for carrying
     out the eligible activities to be funded with such assistance
     amounts.
       ``(2) Reduced community match.--With respect to any 1-year
     period in which assistance is made available under this
     section, the Director may adjust the contribution required
     under paragraph (1) by any State, and for the communities
     located in that State, to not less than 10 percent of the
     cost of the activities for each severe repetitive loss
     property for which grant amounts are provided if, for such
     year--
       ``(A) the State has an approved State mitigation plan
     meeting the requirements for hazard mitigation planning under
     section 322 of the Robert T. Stafford Disaster Relief and
     Emergency Assistance Act (42 U.S.C. 5165) that specifies how
     the State intends to reduce the number of severe repetitive
     loss properties; and
       ``(B) the Director determines, after consultation with the
     State, that the State has taken actions to reduce the number
     of such properties.
       ``(3) Non-federal funds.--For purposes of this subsection,
     the term `non-Federal funds' includes State or local agency
     funds, in-kind contributions, any salary paid to staff to
     carry out the eligible activities of the recipient, the value
     of the time and services contributed by volunteers to carry
     out such activities (at a rate determined by the Director),
     and the value of any donated material or building and the
     value of any lease on a building.
       ``(e) Standards for Mitigation Offers.--The program under
     this section for providing assistance for eligible activities
     for severe repetitive loss properties shall be subject to the
     following limitations:
       ``(1) Priority.--In determining the properties for which to
     provide assistance for eligible activities under subsection
     (c), the Director shall provide assistance for properties in
     the order that will result in the greatest amount of savings
     to the National Flood Insurance Fund in the shortest period
     of time.
       ``(2) Offers.--The Director shall provide assistance in a
     manner that permits States and communities to make offers to
     owners of severe repetitive loss properties to take eligible
     activities under subsection (c) as soon as practicable.
       ``(3) Notice.--Upon making an offer to provide assistance
     with respect to a property for any eligible activity under
     subsection (c), the State or community shall notify each
     holder of a recorded interest on the property of such offer
     and activity.
       ``(f) Purchase Offers.--A State or community may take
     action under subsection (c)(2) to purchase a severe
     repetitive loss property only if the following requirements
     are met:
       ``(1) Use of property.--The State or community enters into
     an agreement with the Director that provides assurances that
     the property purchased will be used in a manner that is
     consistent with the requirements of section 404(b)(2)(B) of
     the Robert T. Stafford Disaster Relief and Emergency
     Assistance Act (42 U.S.C. 5170c(b)(2)(B)) for properties
     acquired, accepted, or from which a structure will be removed
     pursuant to a project provided property acquisition and
     relocation assistance under such section 404(b).
       ``(2) Offers.--The Director shall provide assistance in a
     manner that permits States and communities to make offers to
     owners of severe repetitive loss properties and of associated
     land to engage in eligible activities as soon as possible.
       ``(3) Purchase price.--The amount of purchase offer is not
     less than the greatest of--
       ``(A) the amount of the original purchase price of the
     property, when purchased by the holder of the current policy
     of flood insurance under this title;
       ``(B) the total amount owed, at the time the offer to
     purchase is made, under any loan secured by a recorded
     interest on the property; and

[[Page S6811]]

       ``(C) an amount equal to the fair market value of the
     property immediately before the most recent flood event
     affecting the property, or an amount equal to the current
     fair market value of the property.
       ``(4) Comparable housing payment.--If a purchase offer made
     under paragraph (2) is less than the cost of the homeowner-
     occupant to purchase a comparable replacement dwelling
     outside the flood hazard area in the same community, the
     Director shall make available an additional relocation
     payment to the homeowner-occupant to apply to the difference.
       ``(g) Increased Premiums in Cases of Refusal To Mitigate.--
       ``(1) In general.--In any case in which the owner of a
     severe repetitive loss property refuses an offer to take
     action under paragraph (1) or (2) of subsection (c) with
     respect to such property, the Director shall--
       ``(A) notify each holder of a recorded interest on the
     property of such refusal; and
       ``(B) notwithstanding subsections (a) through (c) of
     section 1308, thereafter the chargeable premium rate with
     respect to the property shall be the amount equal to 150
     percent of the chargeable rate for the property at the time
     that the offer was made, as adjusted by any other premium
     adjustments otherwise applicable to the property and any
     subsequent increases pursuant to paragraph (2) and subject to
     the limitation under paragraph (3).
       ``(2) Increased premiums upon subsequent flood damage.--
     Notwithstanding subsections (a) through (c) of section 1308,
     if the owner of a severe repetitive loss property does not
     accept an offer to take action under paragraph (1) or (2) of
     subsection (c) with respect to such property and a claim
     payment exceeding $1,500 is made under flood insurance
     coverage under this title for damage to the property caused
     by a flood event occurring after such offer is made,
     thereafter the chargeable premium rate with respect to the
     property shall be the amount equal to 150 percent of the
     chargeable rate for the property at the time of such flood
     event, as adjusted by any other premium adjustments otherwise
     applicable to the property and any subsequent increases
     pursuant to this paragraph and subject to the limitation
     under paragraph (3).
       ``(3) Limitation on increased premiums.--In no case may the
     chargeable premium rate for a severe repetitive loss property
     be increased pursuant to this subsection to an amount
     exceeding the applicable estimated risk premium rate for the
     area (or subdivision thereof) under section 1307(a)(1).
       ``(4) Treatment of deductibles.--Any increase in chargeable
     premium rates required under this subsection for a severe
     repetitive loss property may be carried out, to the extent
     appropriate, as determined by the Director, by adjusting any
     deductible charged in connection with flood insurance
     coverage under this title for the property.
       ``(5) Notice of continued offer.--Upon each renewal or
     modification of any flood insurance coverage under this title
     for a severe repetitive loss property, the Director shall
     notify the owner that the offer made pursuant to subsection
     (c) is still open.
       ``(6) Appeals.--
       ``(A) In general.--Any owner of a severe repetitive loss
     property may appeal a determination of the Director to take
     action under paragraph (1)(B) or (2) with respect to such
     property, based only upon the following grounds:
       ``(i) As a result of such action, the owner of the property
     will not be able to purchase a replacement primary residence
     of comparable value and that is functionally equivalent.
       ``(ii) Based on independent information, such as contractor
     estimates or appraisals, the property owner believes that the
     price offered for purchasing the property is not an accurate
     estimation of the value of the property, or the amount of
     Federal funds offered for mitigation activities, when
     combined with funds from non-Federal sources, will not cover
     the actual cost of mitigation.
       ``(iii) As a result of such action, the preservation or
     maintenance of any prehistoric or historic district, site,
     building, structure, or object included in, or eligible for
     inclusion in, the National Register of historic places will
     be interfered with, impaired, or disrupted.
       ``(iv) The flooding that resulted in the flood insurance
     claims described in subsection (b)(2) for the property
     resulted from significant actions by a third party in
     violation of Federal, State, or local law, ordinance, or
     regulation.
       ``(v) In purchasing the property, the owner relied upon
     flood insurance rate maps of the Federal Emergency Management
     Agency that were current at the time and did not indicate
     that the property was located in an area having special flood
     hazards.
       ``(B) Procedure.--An appeal under this paragraph of a
     determination of the Director shall be made by filing, with
     the Director, a request for an appeal within 90 days after
     receiving notice of such determination. Upon receiving the
     request, the Director shall select, from a list of
     independent third parties compiled by the Director for such
     purpose, a party to hear such appeal. Within 90 days after
     filing of the request for the appeal, such third party shall
     review the determination of the Director and shall set aside
     such determination if the third party determines that the
     grounds under subparagraph (A) exist. During the pendency of
     an appeal under this paragraph, the Director shall stay the
     applicability of the rates established pursuant to paragraph
     (1)(B) or (2), as applicable.
       ``(C) Effect of final determination.--In an appeal under
     this paragraph--
       ``(i) if a final determination is made that the grounds
     under subparagraph (A) exist, the third party hearing such
     appeal shall make a determination of how much to reduce the
     chargeable risk premium rate for flood insurance coverage for
     the property involved in the appeal from the amount required
     under paragraph (1)(B) or (2) and the Director shall promptly
     reduce the chargeable risk premium rate for such property by
     such amount; and
       ``(ii) if a final determination is made that the grounds
     under subparagraph (A) do not exist, the Director shall
     promptly increase the chargeable risk premium rate for such
     property to the amount established pursuant to paragraph
     (1)(B) or (2), as applicable, and shall collect from the
     property owner the amount necessary to cover the stay of the
     applicability of such increased rates during the pendency of
     the appeal.
       ``(D) Costs.--If the third party hearing an appeal under
     this paragraph is compensated for such service, the costs of
     such compensation shall be borne--
       ``(i) by the owner of the property requesting the appeal,
     if the final determination in the appeal is that the grounds
     under subparagraph (A) do not exist; and
       ``(ii) by the National Flood Insurance Fund, if such final
     determination is that the grounds under subparagraph (A) do
     exist.
       ``(E) Report.--Not later than 6 months after the date of
     the enactment of the Flood Insurance Reform Act of 2004, the
     Director shall submit a report describing the rules,
     procedures, and administration for appeals under this
     paragraph to--
       ``(i) the Committee on Banking, Housing, and Urban Affairs
     of the Senate; and
       ``(ii) the Committee on Financial Services of the House of
     Representatives.
       ``(h) Discretionary Actions in Cases of Fraudulent
     Claims.--If the Director determines that a fraudulent claim
     was made under flood insurance coverage under this title for
     a severe repetitive loss property, the Director may--
       ``(1) cancel the policy and deny the provision to such
     policyholder of any new flood insurance coverage under this
     title for the property; or
       ``(2) refuse to renew the policy with such policyholder
     upon expiration and deny the provision of any new flood
     insurance coverage under this title to such policyholder for
     the property.
       ``(i) Funding.--
       ``(1) In general.--Pursuant to section 1310(a)(8), the
     Director may use amounts from the National Flood Insurance
     Fund to provide assistance under this section in each of
     fiscal years 2004, 2005, 2006, 2007, and 2008, except that
     the amount so used in each such fiscal year may not exceed
     $40,000,000 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.
       ``(2) Administrative expenses.--Of the amounts made
     available under this subsection, the Director may use up to 5
     percent for expenses associated with the administration of
     section 1361A.
       ``(j) Termination.--The Director may not provide assistance
     under this section to any State or community after September
     30, 2008.''.
       (b) Availability of National Flood Insurance Fund
     Amounts.--Section 1310(a) of the National Flood Insurance Act
     of 1968 (42 U.S.C. 4017(a)) is amended--
       (1) in paragraph (7), by striking ``and'' at the end; and
       (2) by striking paragraph (8) and inserting the following:
       ``(8) for financial assistance under section 1361A to
     States and communities for taking actions under such section
     with respect to severe repetitive loss properties, but only
     to the extent provided in section 1361A(i); and''.

     SEC. 103. AMENDMENTS TO EXISTING FLOOD MITIGATION ASSISTANCE
                   PROGRAM.

       (a) Standard for Approval of Mitigation Plans.--Section
     1366(e)(3) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4104c) is amended by adding at the end the following
     new sentence: ``The Director may approve only mitigation
     plans that give priority for funding to such properties, or
     to such subsets of properties, as are in the best interest of
     the National Flood Insurance Fund.''.
       (b) Priority for Mitigation Assistance.--Section 1366(e) of
     the National Flood Insurance Act of 1968 (42 U.S.C. 4104c) is
     amended by striking paragraph (4) and inserting the
     following:
       ``(4) Priority for mitigation assistance.--In providing
     grants under this subsection for mitigation activities, the
     Director shall give first priority for funding to such
     properties, or to such subsets of such properties as the
     Director may establish, that the Director determines are in
     the best interests of the National Flood Insurance Fund and
     for which matching amounts under subsection (f) are
     available.''.
       (c) Coordination With States and Communities.--Section 1366
     of the National Flood Insurance Act of 1968 (42 U.S.C. 4104c)
     is amended by adding at the end the following:

[[Page S6812]]

       ``(m) Coordination With States and Communities.--The
     Director shall, in consultation and coordination with States
     and communities take such actions as are appropriate to
     encourage and improve participation in the national flood
     insurance program of owners of properties, including owners
     of properties that are not located in areas having special
     flood hazards [but are located within the 100-year
     floodplain] (the 100-year floodplain), but are located within
     flood prone areas.''.
       (d) Funding.--Section 1367(b) of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4104d(b)) is amended by
     striking paragraph (1) and inserting the following:
       ``(1) in each fiscal year, amounts from the National Flood
     Insurance Fund not exceeding $40,000,000, to remain available
     until expended;''.
       (e) Reduced Community Match.--Section 1366(g) of the
     National Flood Insurance Act of 1968 (42 U.S.C. 4104c(g)), is
     amended--
       (2) by redesignating paragraph (2) as paragraph (3); and
       (3) by inserting after paragraph (1) the following:
       ``(2) Reduced community match.--With respect to any 1-year
     period in which assistance is made available under this
     section, the Director may adjust the contribution required
     under paragraph (1) by any State, and for the communities
     located in that State, to not less than 10 percent of the
     cost of the activities for each severe repetitive loss
     property for which grant amounts are provided if, for such
     year--
       ``(A) the State has an approved State mitigation plan
     meeting the requirements for hazard mitigation planning under
     section 322 of the Robert T. Stafford Disaster Relief and
     Emergency Assistance Act (42 U.S.C. 5165) that specifies how
     the State intends to reduce the number of severe repetitive
     loss properties; and
       ``(B) the Director determines, after consultation with the
     State, that the State has taken actions to reduce the number
     of such properties.''.
       (f) National Flood Mitigation Fund.--Section 1366(b)(2) of
     the National Flood Insurance Act of 1968 (42 U.S.C.
     4104c(b)(2)), is amended by striking ``$1,500,000'' and
     inserting ``7.5 percent of the available funds under this
     section''.

     SEC. 104. FEMA AUTHORITY TO FUND MITIGATION ACTIVITIES FOR
                   INDIVIDUAL REPETITIVE CLAIMS PROPERTIES.

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

     ``SEC. 1323. GRANTS FOR REPETITIVE INSURANCE CLAIMS
                   PROPERTIES.

       ``(a) In General.--The Director may provide funding for
     mitigation actions that reduce flood damages to individual
     properties for which 1 or more claim payments for losses have
     been made under flood insurance coverage under this title,
     but only if the Director determines that--
       ``(1) such activities are in the best interest of the
     National Flood Insurance Fund; and
       ``(2) such activities cannot be funded under the program
     under section 1366 because--
       ``(A) the requirements of section 1366(g) are not being met
     by the State or community in which the property is located;
     or
       ``(B) the State or community does not have the capacity to
     manage such activities.
       ``(b) Priority for Worst-Case Properties.--In determining
     the properties for which funding is to be provided under this
     section, the Director shall consult with the States in which
     such properties are located and provide assistance for
     properties in the order that will result in the greatest
     amount of savings to the National Flood Insurance Fund in the
     shortest period of time.''.
       (b) Availability of National Flood Insurance Fund
     Amounts.--Section 1310(a) of the National Flood Insurance Act
     of 1968 (42 U.S.C. 4017(a)) is amended by adding at the end
     the following:
       ``(9) for funding, not to exceed $10,000,000 in any fiscal
     year, for mitigation actions under section 1323, except that,
     notwithstanding any other provision of this title, amounts
     made available pursuant to this paragraph shall not be
     subject to offsetting collections through premium rates
     for flood insurance coverage under this title.''.

     SEC. 105. AMENDMENTS TO ADDITIONAL COVERAGE FOR COMPLIANCE
                   WITH LAND USE AND CONTROL MEASURES.

       (a) Compliance With Land Use and Control Measures.--Section
     1304(b) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4011(b)) is amended--
       (1) in the matter preceding paragraph (1)--
       (A) by striking ``compliance'' and inserting ``implementing
     measures that are consistent''; and
       (B) by inserting ``by the community'' after
     ``established'';
       (2) in paragraph (2), by striking ``have flood damage in
     which the cost of repairs equals or exceeds 50 percent of the
     value of the structure at the time of the flood event; and''
     and inserting ``are substantially damaged structures;''
       (3) in paragraph (3), by striking ``compliance with land
     use and control measures.'' and inserting ``the
     implementation of such measures; and''; and
       (4) by inserting after paragraph (3) and before the last
     undesignated paragraph the following:
       ``(4) properties for which an offer of mitigation
     assistance is made under--
       ``(A) section 1366 (Flood Mitigation Assistance Program);
       ``(B) section 1368 (Repetitive Loss Priority Program and
     Individual Priority Property Program);
       ``(C) the Hazard Mitigation Grant Program authorized under
     section 404 of the Robert T. Stafford Disaster Assistance and
     Emergency Relief Act (42 U.S.C. 5170c);
       ``(D) the Predisaster Hazard Mitigation Program under
     section 203 of the Robert T. Stafford Disaster Assistance and
     Emergency Relief Act (42 U.S.C. 5133); and
       ``(E) any programs authorized or for which funds are
     appropriated to address any unmet needs or for which
     supplemental funds are made available.''.
       (b) Definitions.--Section 1370(a) of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4121(a)) is amended--
       (1) by striking paragraph (7) and inserting the following:
       ``(7) the term `repetitive loss structure' means a
     structure covered by a contract for flood insurance that--
       ``(A) has incurred flood-related damage on 2 occasions, in
     which the cost of repair, on the average, equaled or exceeded
     25 percent of the value of the structure at the time of each
     such flood event; and
       ``(B) at the time of the second incidence of flood-related
     damage, the contract for flood insurance contains increased
     cost of compliance coverage.'';
       (2) in paragraph (13), by striking ``and'' at the end;
       (3) in paragraph (14), by striking the period and inserting
     ``; and''; and
       (4) by adding at the end the following:
       ``(15) the term `substantially damaged structure' means a
     structure covered by a contract for flood insurance that has
     incurred damage for which the cost of repair exceeds an
     amount specified in any regulation promulgated by the
     Director, or by a community ordinance, whichever is lower.''.

     SEC. 106. ACTUARIAL RATE PROPERTIES.

       (a) In General.--Section 1308 of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4015) is amended by striking
     subsection (c) and inserting the following:
       ``(c) Actuarial Rate Properties.--Subject only to the
     limitations provided under paragraphs (1) and (2), the
     chargeable rate shall not be less than the applicable
     estimated risk premium rate for such area (or subdivision
     thereof) under section 1307(a)(1) with respect to the
     following properties:
       ``(1) Post-firm properties.--Any property the construction
     or substantial improvement of which the Director determines
     has been started after December 31, 1974, or started after
     the effective date of the initial rate map published by the
     Director under paragraph (2) of section 1360 for the area in
     which such property is located, whichever is later, except
     that the chargeable rate for properties under this paragraph
     shall be subject to the limitation under subsection (e).
       ``(2) Certain leased coastal and river properties.--Any
     property leased from the Federal Government (including
     residential and nonresidential properties) that the Director
     determines is located on the river-facing side of any dike,
     levee, or other riverine flood control structure, or seaward
     of any seawall or other coastal flood control structure.''.
       (b) Inapplicability of Annual Limitations on Premium
     Increases.--Section 1308(e) of the National Flood Insurance
     Act of 1968 (42 U.S.C. 4015(e)) is amended by striking
     ``Notwithstanding'' and inserting ``Except with respect to
     properties described under paragraph (2) or (3) of subsection
     (c), and notwithstanding''.

     SEC. 107. GEOSPATIAL DIGITAL FLOOD HAZARD DATA.

       For the purposes of flood insurance and floodplain
     management activities conducted pursuant to the National
     Flood Insurance Program under the National Flood Insurance
     Act of 1968 (42 U.S.C. 4001 et seq.), geospatial digital
     flood hazard data distributed by the Federal Emergency
     Management Agency, or its designee, or the printed products
     derived from that data, are interchangeable and legally
     equivalent for the determination of the location of 1 in 100
     year and 1 in 500 year flood planes, provided that all other
     geospatial data shown on the printed product meets or exceeds
     any accuracy standard promulgated by the Federal Emergency
     Management Agency.

     SEC. 108. REPLACEMENT OF MOBILE HOMES ON ORIGINAL SITES.

       Section 1315 of the National Flood Insurance Act of 1968
     (42 U.S.C. 4022) is amended by adding at the end the
     following:
       ``(c) Replacement of Mobile Homes on Original Sites.--
       ``(1) Community participation.--The placement of any mobile
     home on any site shall not affect the eligibility of any
     community to participate in the flood insurance program under
     this title and the Flood Disaster Protection Act of 1973
     (notwithstanding that such placement may fail to comply
     with any elevation or flood damage mitigation
     requirements), if--
       ``(A) such mobile home was previously located on such site;
       ``(B) such mobile home was relocated from such site because
     of flooding that threatened or affected such site; and
       ``(C) such replacement is conducted not later than the
     expiration of the 180-day period that begins upon the
     subsidence (in the area of such site) of the body of water
     that flooded to a level considered lower than flood levels.
       ``(2) Definition.--For purposes of this subsection, the
     term `mobile home' has the

[[Page S6813]]

     meaning given such term in the law of the State in which the
     mobile home is located.''.

     SEC. 109. REITERATION OF FEMA RESPONSIBILITY TO MAP
                   MUDSLIDES.

       As directed in section 1360(b) of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4101(b)), the Director of
     the Federal Emergency Management Agency is again directed to
     accelerate the identification of risk zones within flood-
     prone and mudslide-prone areas, as provided by subsection
     (a)(2) of such section 1360, in order to make known the
     degree of hazard within each such zone at the earliest
     possible date.

                   TITLE II--MISCELLANEOUS PROVISIONS

     SEC. 201. DEFINITIONS.

       In this title, the following definitions shall apply:
       (1) Director.--The term ``Director'' means the Director of
     the Federal Emergency Management Agency.
       (2) Flood insurance policy.--The term ``flood insurance
     policy'' means a flood insurance policy issued under the
     National Flood Insurance Act of 1968 (42 U.S.C. et seq.).
       (3) Program.--The term ``Program'' means the National Flood
     Insurance Program established under the National Flood
     Insurance Act of 1968 (42 U.S.C. 4001 et seq.).

     SEC. 202. SUPPLEMENTAL FORMS.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop
     supplemental forms to be issued in conjunction with the
     issuance of a flood insurance policy that set forth, in
     simple terms--
       (1) the exact coverages being purchased by a policyholder;
       (2) any exclusions from coverage that apply to the
     coverages purchased;
       (3) an explanation, including illustrations, of how lost
     items and damages will be valued under the policy at the time
     of loss;
       (4) the number and dollar value of claims filed under a
     flood insurance policy over the life of the property, and the
     effect, under the National Flood Insurance Act of 1968 (42
     U.S.C. 4001 et seq.), of the filing of any further claims
     under a flood insurance policy with respect to that property;
     and
       (5) any other information that the Director determines will
     be helpful to policyholders in understanding flood insurance
     coverage.
       (b) Distribution.--The forms developed under subsection (a)
     shall be given to--
       (1) all holders of a flood insurance policy at the time of
     purchase and renewal; and
       (2) insurance companies and agents that are authorized to
     sell flood insurance policies.

     SEC. 203. ACKNOWLEDGEMENT FORM.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop an
     acknowledgement form to be signed by the purchaser of a flood
     insurance policy that contains--
       (1) an acknowledgement that the purchaser has received a
     copy of the standard flood insurance policy, and any forms
     developed under section 202; and
       (2) an acknowledgement that the purchaser has been told
     that the contents of a property or dwelling are not covered
     under the terms of the standard flood insurance policy, and
     that the policyholder has the option to purchase additional
     coverage for such contents.
       (b) Distribution.--Copies of an acknowledgement form
     executed under subsection (a) shall be made available to the
     purchaser and the Director.

     SEC. 204. FLOOD INSURANCE CLAIMS HANDBOOK.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop a flood
     insurance claims handbook that contains--
       (1) a description of the procedures to be followed to file
     a claim under the Program, including how to pursue a claim to
     completion;
       (2) how to file supplementary claims, proof of loss, and
     any other information relating to the filing of claims under
     the Program; and
       (3) detailed information regarding the appeals process
     established under section 205.
       (b) Distribution.--The handbook developed under subsection
     (a) shall be made available to--
       (1) each insurance company and agent authorized to sell
     flood insurance policies; and
       (2) each purchaser, at the time of purchase and renewal, of
     a flood insurance policy, and at the time of any flood loss
     sustained by such purchaser.

     SEC. 205. APPEAL OF DECISIONS RELATING TO FLOOD INSURANCE
                   COVERAGE.

       Not later than 6 months after the date of enactment of this
     Act, the Director shall, by regulation, establish an appeals
     process through which holders of a flood insurance policy may
     appeal the decisions, with respect to claims, proofs of loss,
     and loss estimates relating to such flood insurance policy,
     of--
       (1) any insurance agent or adjuster, or insurance company;
     or
       (2) any employee or contractor of the Federal Emergency
     Management Agency.

     SEC. 206. STUDY AND REPORT ON USE OF COST COMPLIANCE
                   COVERAGE.

       Not later than 1 year after the date of enactment of this
     Act, the Director of the Federal Emergency Management Agency
     shall submit to Congress a report that sets forth--
       (1) the use of cost of compliance coverage under section
     1304(b) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4011(b)) in connection with flood insurance policies;
       (2) any barriers to policyholders using the funds provided
     by cost of compliance coverage under that section 1304(b)
     under a flood insurance policy, and recommendations to
     address those barriers; and
       (3) the steps that the Federal Emergency Management Agency
     has taken to ensure that funds paid for cost of compliance
     coverage under that section 1304(b) are being used to lessen
     the burdens on all homeowners and the Program.

     SEC. 207. MINIMUM TRAINING AND EDUCATION REQUIREMENTS.

       The Director of the Federal Emergency Management Agency
     shall, in cooperation with the insurance industry, State
     insurance regulators, and other interested parties--
       (1) establish minimum training and education requirements
     for all insurance agents who sell flood insurance policies;
     and
       (2) not later than 6 months after the date of enactment of
     this Act, publish these requirements in the Federal Register,
     and inform insurance companies and agents of the
     requirements.

     SEC. 208. GAO STUDY AND REPORT.

       (a) Study.--The Comptroller General of the United States
     shall conduct a study of--
       (1) the adequacy of the scope of coverage provided under
     flood insurance policies in meeting the intended goal of
     Congress that flood victims be restored to their pre-flood
     conditions, and any recommendations to ensure that goal is
     being met;
       (2) the adequacy of payments to flood victims under flood
     insurance policies; and
       (3) the practices of the Federal Emergency Management
     Agency and insurance adjusters in estimating losses incurred
     during a flood, and how such practices affect the adequacy of
     payments to flood victims.
       (b) Report.--Not later than 1 year after the date of
     enactment of this Act, the Comptroller General shall submit
     to Congress a report regarding the results of the study under
     subsection (a).

     SEC. 209. PROSPECTIVE PAYMENT OF FLOOD INSURANCE PREMIUMS.

       Section 1308 of the National Flood Insurance Act of 1968
     (42 U.S.C. 4015) is amended by adding at the end the
     following:
       ``(f) Adjustment of Premium.--Notwithstanding any other
     provision of law, if the Director determines that the holder
     of a flood insurance policy issued under this Act is paying a
     lower premium than is required under this section due to an
     error in the flood plain determination, the Director may only
     prospectively charge the higher premium rate.''.

     SEC. 210. REPORT ON CHANGES TO FEE SCHEDULE OR FEE PAYMENT
                   ARRANGEMENTS.

       Not later than 3 months after the date of enactment of this
     Act, the Director shall submit a report on any changes or
     modifications made to the fee schedule or fee payment
     arrangements between the Federal Emergency Management Agency
     and insurance adjusters who provide services with respect to
     flood insurance policies to--
       (1) the Committee on Banking, Housing, and Urban Affairs of
     the Senate; and
       (2) the Committee on Financial Services of the House of
     Representatives.

  Mr. SHELBY. Mr. President, I would first like to acknowledge the
leadership of Senator Bunning in crafting this legislation. In
addition, several members of the Banking Committee, from both sides of
the aisle, are co-sponsors on S. 2238. The Banking Committee
unanimously voted to favorably report S. 2238 on March 30, 2004. This
has truly been a bipartisan effort.
  This is important legislation that will go a long way in bringing the
flood insurance fund toward financial soundness, while protecting
existing property owners. The pilot program established in Section 102
will help to address the mitigation of severe repetitive loss
properties. These properties, while only a small percentage of insured
properties, constitute a large share of claims paid. FEMA estimates
that while repetitive loss properties only account for approximately 1
percent of all insured properties, these properties account for over 30
percent of amounts paid in claims. In addition, most of these
properties were constructed before the development of flood insurance
rate maps, and are paying subsidized rates for flood insurance.
  S. 2238 provides an additional $40 million annually for mitigation
activities. This additional funding will allow families that have lived
through several floods and suffered substantial harm, both financial
and emotional, to either flood-proof their home or have their home
bought-out.
  I also want to commend Senator Sarbanes for his efforts. Title II of
S. 2238 is largely his creation. I believe Title II will ensure that
families displaced by floods receive adequate and timely assistance.
  The managers' amendment to S. 2238 represents several technical and
conforming changes. First the definition of repetitive loss property is
narrowed. This change was made to assure concerned parties that the
pilot program would be targeted at those properties that have indeed
suffered the greatest

[[Page S6814]]

losses. The managers' amendment also clarifies the funding allocation
of the additional mitigation dollars that will be provided under the
pilot program. A more explicit allocation is needed to insure that
those States hit hardest by flooding receive an adequate flow of
funding. The managers' amendment also extends the pilot program and the
National Flood Insurance Program until September 30, 2009.
  Mr. SARBANES. Mr. President, I support the passage of S. 2238, as
amended, and want to urge my colleagues to support this critical
legislation which ensures the continuation of the National Flood
Insurance Program, which covers over 4.4 million properties around the
country. Unless we quickly act to reauthorize this program, it will
expire at the end of this month. In addition to extending the National
Flood Insurance Program for 5 years, this bill establishes a loss
mitigation pilot program to help mitigate flood risks for properties
that have been flooded numerous times.
  This bill has been drafted in a bipartisan manner, and I particularly
want to thank Senators Bunning and Shelby for working collaboratively
with me to craft this legislation and also for accepting my amendment
which makes a number of administrative changes to the National Flood
Insurance Program designed to strengthen the program and ensure that
flood victims can fairly and adequately recover for flood losses. While
Federal flood insurance was created almost 40 years ago to ``provide
the necessary funds promptly to assure rehabilitation or restoration of
damaged property to pre-flood status or to permit comparable investment
elsewhere,'' unfortunately, the program is not working as Congress
envisioned. Recent flooding in Maryland as a result of Hurricane Isabel
in September 2003, showed that under the strain of a major flooding
event, the National Flood Insurance Program was unable to withstand the
pressure. Unfortunately, many of the 6,000 Marylanders who filed claims
after Hurricane Isabel found the process of recovering under their
flood insurance policies to be difficult, time-consuming and
frustrating. Too many victims were given incomplete or inaccurate
information or were coerced into settling claims that came nowhere near
close to providing adequate funding for repairs.
  My amendment, as contained in this bill, ensures that policyholders
are provided with accurate and timely information about their policies
as well as what to do in the event of a flood. As a result of this
legislation, FEMA will be required to establish a formal appeals
process for complaints; disseminate a claims handbook so that families
know exactly what to do if they are flooded; provide simple forms and
disclosures so that all policyholders know what coverages are available
and what coverages they are purchasing; and, establish minimum agent
training requirements so that insurance agents, the main points of
contact for flood victims, have a better understanding of this program.
In addition, this bill asks the General Accounting Office of conduct a
thorough review of the flood insurance program, with particular
emphasis on limitations in the flood insurance policy and FEMA's
interpretations of this policy. We need to have a detailed
understanding of what these limitations are and what the consequences
are of broadening coverage. As a result of these changes, I am hopeful
that flood victims around the country will not face the same obstacles
to receiving fair payments as Marylanders faced last year.
  In addition to the administrative changes we are making in this bill,
I have been working with my colleague, Senator Mikulski, and FEMA to
ensure that FEMA does all it can to improve its processes and policies
so that flood victims can better navigate the flood insurance program
and more fairly settle their claims. I believe that FEMA is working to
fix those problems that were brought to its attention, and I want to
thank Mr. Anthony Lowe, former Federal insurance administrator, and Mr.
Trey Reid, acting insurance administrator, who now oversees the
program, for working with me and my colleagues to go back and make sure
that Hurricane Isabel flood victims are treated fairly. After Hurricane
Isabel, I received numerous complaints that flood victims were
pressured into accepting settlements far below what they consider fair,
in addition to our findings that FEMA distributed inaccurate price
guidelines for the costs of repairs. When confronted with these issues,
Mr. Lowe, Mr. Reid, and FEMA staff quickly responded. Letters have now
been sent to all flood victims who believe they were treated unfairly
can have their claims reviewed. While I appreciate these efforts, I
understand that there is some concern that these reviews are not being
conducted in an independent way, and I have urged FEMA to take all
actions to ensure that this process is fair. The process of reviewing
these claims is a fair and necessary step in maintaining the integrity
of the National Flood Insurance Program, and I will continue working
with FEMA to ensure that all victims are able to have their claims
reviewed in an unbiased manner.

  This is an important piece of legislation. In addition to the changes
contained in my amendment, this bill will help to strengthen and
stabilize the flood insurance program by providing $40 million a year
to states and communities to mitigate flood risks. While the National
Flood Insurance Program has primarily been able to cover losses through
the premiums it collects, there have been times when it has had to
borrow funds from the Treasury, and this is in large part due to a
relatively small number of properties. According to FEMA, these
repetitive loss properties account for only 1 percent of policies, but
over 35 percent of all losses in the flood insurance program. This bill
makes funding available so that communities can assist families who are
stuck in a cycle of repeated flooding to get out of harm's way, and so
that these properties are less of a drain on the National Flood
Insurance Program.
  Once again, I thank Senators Shelby and Bunning for working with me
in such a collaborative manner on this bill.
  Mr. NELSON of Florida. Mr. President, I commend Senators Shelby,
Sarbanes, and Bunning for their efforts in drafting the S. 2238, the
Bunning/Bereuter/Blumenauer Flood Insurance Reform Act. They have
worked with Senator Graham and me to make some important changes that
will greatly benefit Federal flood insurance policy holders. Since
1968, the National Flood Insurance Program has provided reasonably
priced insurance to Americans across the country. In Florida alone,
there are approximately 2 million flood insurance policies.
  I support this legislation and, as the former elected insurance
commissioner of the State of Florida, appreciate its goals and purpose.
However, I have a unique situation in Florida dealing with flood
insurance and would like to take a few minutes to bring it to my
colleagues' attention.
  There is a community in Gulf Country in North Florida known as Cape
San Blas. The area has some of the most impressive, pristine beaches in
the State. You can see the unique physical characteristics of the Cape
quite clearly from space--it is a swath of land that juts out into the
Gulf of Mexico.
  Most of the residents of Cape San Blas have lived there for some time
and have seen first hand the incredible damage and awesome forces of
nature brought to bear by hurricanes. And ere we are today, 2 weeks
into hurricane season and a good number of the residents of the Cape
either do not have flood insurance or have to purchase it at a very
high price.
  Since 1983, most of Cape San Blas has been included in the Coastal
Barrier Resources System, which prevents the Cape from receiving many
forms of Federal assistance, most notably flood insurance. But the
residents made due by other means, relying on the private market or, in
some cases, simply not purchasing flood insurance because it was not a
requirement at the time.
  Back in 1995, after Hurricane Opal tore through parts of the Florida
panhandle, the Federal Emergency Management Agency, FEMA, determined
its flood maps required revisions. The agency decided it would need to
remap the area and began the process. The new maps took effect in
November 202 and placed a large portion of the Cape and the surrounding
area in a special flood hazard area--an area of land that has a 1
percent chance of being flooded in any given year. A home located

[[Page S6815]]

within this area has a 26 percent chance of suffering flood damage
during the term of a 30-year mortgage.
  The special flood hazard area designation has had a devastating
effect on the local economy for several reasons. First, under the Flood
Disaster Protection Act of 1973 mandates flood insurance for property
in a special flood hazard area that receives a federally backed loan.
If a local bank writes a home loan, without Federal backing, while the
bank may not require flood insurance, it does face a safety and
soundness issue and possible enforcement action with federal banking
regulators for offering high-risk loans.
  As a result of the new classification, some residents who never had
to carry flood insurance before suddenly found it was a requirement.
Many long-time homeowners have been forced to scramble to buy private
flood insurance, often at very high rates. Some are also prevented from
borrowing against their hard-earned equity, because second mortgages
also require hard-to-obtain flood insurance. Local banks have had to
turn away homeowners because of this.
  The new maps and classification have had a devastating effect on
homeowners and the local economy already weakened by the closure of a
paper mill and saddled with high rates of unemployment. With the stroke
of a pen, FEMA radically changed the lives of thousands of residents
and property owners in Cape San Blas. On the Cape, prior to FEMA's new
maps, about 70 percent of the lands were not in special flood zone
areas and financing was easily obtainable. The new maps placed
approximately 75 percent of the Cape in a special flood hazard area and
financing is near impossible. Even worse, the new flood maps have
slowed the new economic engine of the Cape--tourism, construction and
development.
  This is a clear case of a Government action adversely affecting the
lives of citizens. It is simply unfair. There must be a way to make the
residents whole again, and I think we have a responsibility to explore
every possible avenue to do so. I had considered legislative remedies
for the residents of Cape San Blas on the flood insurance bill. Yet I
am very aware the flood insurance program is set to expire in 15 days
and do not want to block the passage of this legislation, which is so
critical to Florida and the Nation. But in the coming weeks, I intend
to work with my colleagues and the Banking and Environment and Public
Works Committees, with Congressman Allen Boyd, who represents Cape San
Blas, and the appropriate Federal agencies to find an equitable
solution to the problem facing the residents of Cape San Blas.
  Ms. LANDRIEU. Mr. President, I am pleased to see that the Senate will
reauthorize the National Flood Insurance program today. This is such an
important program for the people of Louisiana.
  If there is a theme that runs through the social and economic history
of my State, it is water. The Mississippi River, with its great
southern port of New Orleans, has been a center of commerce and an
economic gateway to the east. Smaller rivers, streams, and bayous run
throughout our parishes. More than 8,277 square miles of Louisiana are
covered by water, nearly 16 percent. The entire southern third of my
State could be called a giant wetland, much of it below sea level,
including the city of New Orleans.
  Floods are a part of life in Louisiana, particularly in the southern
part of the State. Louisiana has more than 377,000 insured properties
under the program as of 2003. That same year the program paid nearly
6,000 flood loss claims in Louisiana. The National Flood Insurance
Program allows Louisianians to stay in their homes and protects them
from the devastation nature can wreak.
  The flood program gives the housing, insurance, banking, and mortgage
lending markets in my State greater stability. It also brings peace of
mind to those families who need the program to protect their most
important assets: their homes and businesses.
  However, when this reauthorization bill was reported out of the
Banking Committee, I had deep concerns about a pilot program contained
in the bill designed to address severe repetitive loss properties.
These are properties that experience a lot of flooding. The Federal
Emergency Management Agency estimates that these repetitive loss
properties, while only making up about one percent of all the insured
properties, cost the program $200 million annually. Some property
owners have collected flood claims that are four or five times higher
than the actual value of the property. They refuse to take any action
to minimize the cost to the program and benefit from subsidized
insurance rates.
  Under the pilot program, $40 million in funding would be available on
an optional basis for States and communities to take steps to mitigate
the flood damage potential on these properties. If a property owner
receives a mitigation offer and turns it down, their flood insurance
premiums would increase 50 percent, and would keep on increasing by 50
percent until it reached the actuarial rate for the property. This
provision would help prevent some of the abuse in the program.
  Louisiana has the most repetitive loss properties in the county,
about one-third of the total number nationwide. I had concerns about
how this pilot program would impact low income property owners in my
State and so I put a hold on the bill. I felt that even though State
and local communities could opt into the program, they would not have
as much control over how the program would get funding to property
owners that want mitigation. FEMA held all the cards.
  Let me give an example of what I mean. Under the original bill, FEMA
would award mitigation funds based upon what it felt was in the best
interest of the flood insurance program. I believed that this gave FEMA
the power to overrule local determinations of what kind of flood
mitigation to offer and what properties to mitigate. For example, a
local community that wanted to elevate a structure above the base flood
elevation could be denied relief because FEMA decided that buyouts were
in the best interest of the flood insurance program in order to
permanently remove properties out of the flood insurance program
altogether.
  The impact this could have on property owners could be devastating. I
did not want to see low-income people facing a terrible choice: sell
your property or see your rates go up. Many of these families have
lived on this land for generations. It may flood regularly, but it is
also home. I wanted to make sure the pilot program struck a proper
balance between the needs of the flood insurance program and the rights
of property owners.
  The chairman and ranking member of the Banking Committee, Senators
Shelby and Sarbanes, and myself worked together to make changes to the
bill that I believe have achieved this balance. The changes keep the
pilot program in place but add safeguards requiring FEMA to pay greater
deference to local decisions about what properties to mitigate and what
kinds of mitigation offers are most appropriate. We added demolition
and rebuild as an additional eligible mitigation activity under the
bill, an option that Louisiana's flood plain managers wanted. We also
included a funding formula that insures that Louisiana gets its fair
share of funding under the pilot program. Under FEMA's current
mitigation program, Louisiana only received about $1 million even
though the State had more than $60 million in need.
  I thank Chairman Shelby and the ranking member of the Banking
Committee, Senator Sarbanes, as well as their staffs for their
willingness to work with me on these changes. We have made this
important bill a better deal for local communities in my State and
across the country.
  Mr. WARNER. My understanding is it is cleared on both sides. I ask
unanimous consent that the amendment at the desk be agreed to, the
committee amendments be agreed to, the bill, as amended, be read a
third time and passed, the motion to reconsider be laid upon the table,
and that any statements relating to the bill be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment (No. 3451) was agreed to, as follows:

         (Purpose: To make technical and conforming amendments)

       On page 2, line 3, strike ``Flood Insurance Reform Act of
     2004'' and insert ``Bunning-Bereuter-Blumenaur Flood
     Insurance Reform Act of 2004''.

[[Page S6816]]

       On page 7, line 6, insert ``that decide to participate in
     the pilot program established under this section'' after
     ``communities''.
       On page 7, line 20, strike ``3'' and insert ``4''.
       On page 7, line 24, strike ``$3,000'' and insert
     ``$5,000''.
       On page 7, line 26, strike ``$15,000'' and insert
     ``$20,000''.
       On page 8, line 19, strike ``1 foot above''.
       On page 8, line 22, strike ``(f)'' and insert ``(g)''.
       On page 8, line 25, strike ``1-year period'' and insert
     ``fiscal year''.
       On page 10, between lines 13 and 14, insert the following:
       ``(e) Notice of Mitigation Program.--
       ``(1) In general.--Upon selecting a State or community to
     receive assistance under subsection (a) to carry out eligible
     activities, the Director shall notify the owners of a severe
     repetitive loss property, in plain language, within that
     State or community--
       ``(A) that their property meets the definition of a severe
     repetitive loss property under this section;
       ``(B) that they may receive an offer of assistance under
     this section;
       ``(C) of the types of assistance potentially available
     under this section;
       ``(D) of the implications of declining such offer of
     assistance under this section; and
       ``(E) that there is a right to appeal under this section.
       ``(2) Identification of severe repetitive loss
     properties.--The Director shall take such steps as are
     necessary to identify severe repetitive loss properties, and
     submit that information to the relevant States and
     communities.
       On page 10, line 14, strike ``(e)'' and insert ``(f)''.
       On page 10, line 23, insert ``, in a manner consistent with
     the allocation formula under paragraph (5)'' after ``time''.
       On page 11, between lines 3 and 4, insert the following:
       ``(3) Consultation.--In determining for which eligible
     activities under subsection (c) to provide assistance with
     respect to a severe repetitive loss property, the relevant
     States and communities shall consult, to the extent
     practicable, with the owner of the property.
       ``(4) Deference to local mitigation decisions.--The
     Director shall not, by rule, regulation, or order, establish
     a priority for funding eligible activities under this section
     that gives preference to one type or category of eligible
     activity over any other type or category of eligible
     activity.
       ``(5) Allocation.--
       ``(A) In general.--Subject to subparagraphs (B) and (C), of
     the total amount made available for assistance under this
     section in any fiscal year, the Director shall allocate
     assistance to a State, and the communities located within
     that State, based upon the percentage of the total number of
     severe repetitive loss properties located within that State.
       ``(B) Redistribution.--Any funds allocated to a State, and
     the communities within the State, under subparagraph (A) that
     have not been obligated by the end of each fiscal year shall
     be redistributed by the Director to other States and
     communities to carry out eligible activities in accordance
     with this section.
       ``(C) Exception.--Of the total amount made available for
     assistance under this section in any fiscal year, 10 percent
     shall be made available to communities that--
       ``(i) contain one or more severe repetitive loss
     properties; and
       ``(ii) are located in States that receive little or no
     assistance, as determined by the Director, under the
     allocation formula under subparagraph (A).
       On page 11, line 4, strike ``(3)'' and insert ``(6)''.
       On page 11, line 9, strike ``(f)'' and insert ``(g)''.
       On page 13, line 3, strike ``(g)'' and insert ``(h)''.
       On page 16, line 11, strike ``historic places'' and insert
     ``Historic Places''.
       On page 16, after line 25, insert the following:
       ``(vi) The owner of the property, based on independent
     information, such as contractor estimates or other
     appraisals, demonstrates that an alternative eligible
     activity under subsection (c) is at least as cost effective
     as the initial offer of assistance.
       On page 17, line 22, strike ``that the grounds'' and insert
     ``in favor of the property owner''.
       On page 17, line 24, strike ``make a determination of how
     much to'' and insert ``require the Director to''.
       On page 18, lines 4 through 6, strike ``and the Director
     shall promptly reduce the chargeable risk premium rate for
     such property by such amount'' and insert ``to the amount
     paid prior to the offer to take action under paragraph (1) or
     (2) of subsection (c)''.
       On page 19, line 6, strike ``Flood'' and insert ``Bunning-
     Bereuter-Blumenaur Flood''.
       On page 19, line 16, strike ``(h)'' and insert ``(i)''.
       On page 20, between lines 2 and 3, insert the following:
       ``(j) Rules.--
       ``(1) In general.--The Director shall, by rule--
       ``(A) subject to subsection (f)(4), develop procedures for
     the distribution of funds to States and communities to carry
     out eligible activities under this section; and
       ``(B) ensure that the procedures developed under paragraph
     (1)--
       ``(i) require the Director to notify States and communities
     of the availability of funding under this section, and that
     participation in the pilot program under this section is
     optional;
       ``(ii) provide that the Director may assist States and
     communities in identifying severe repetitive loss properties
     within States or communities;
       ``(iii) allow each State and community to select properties
     to be the subject of eligible activities, and the appropriate
     eligible activity to be performed with respect to each severe
     repetitive loss property; and
       ``(iv) require each State or community to submit a list of
     severe repetitive loss properties to the Director that the
     State or community would like to be the subject of eligible
     activities under this section.
       ``(2) Consultation.--Not later than 90 days after the date
     of enactment of this Act, the Director shall consult with
     State and local officials in carrying out paragraph (1)(A),
     and provide an opportunity for an oral presentation, on the
     record, of data and arguments from such officials.
       On page 20, line 3, strike ``(i)'' and insert ``(k)''.
       On page 20, line 7, strike ``2004,''.
       On page 20, line 8, strike ``and 2008'' and insert ``2008,
     and 2009''.
       On page 20, line 19, strike ``section 1361A'' and insert
     ``this section''.
       On page 20, line 20, strike ``(j)'' and insert ``(l)''.
       On page 20, line 22, strike ``2008'' and insert ``2009''.
       On page 22, line 12, strike ``(m)'' and insert ``(l)''.
       On page 22, strike line 21 and all that follows through
     page 23, line 3, and insert the following:
       (d) Funding.--Section 1367 of the National Flood Insurance
     Act of 1968 (42 U.S.C. 4104d) is amended--
       (1) in subsection (b), by striking paragraph (1) and
     inserting the following:
       ``(1) in each fiscal year, amounts from the National Flood
     Insurance Fund not exceeding $40,000,000, to remain available
     until expended;'';
       (2) by redesignating subsections (c) and (d) as subsections
     (d) and (e), respectively; and
       (3) by inserting after subsection (b) the following:
       ``(c) Administrative Expenses.--The Director may use not
     more than 5 percent of amounts made available under
     subsection (b) to cover salaries, expenses, and other
     administrative costs incurred by the Director to make grants
     and provide assistance under sections 1366 and 1323.''.

  The committee amendments were agreed to.
  The bill (S. 2238), as amended, was read the third time and passed,
as follows:

                                S. 2238

       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 ``Bunning-
     Bereuter-Blumenauer Flood Insurance Reform Act of 2004''.
       (b) Table of Contents.--The table of contents for this Act
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Congressional findings.

           TITLE I--AMENDMENTS TO FLOOD INSURANCE ACT OF 1968

Sec. 101. Extension of program and consolidation of authorizations.
Sec. 102. Establishment of pilot program for mitigation of severe
              repetitive loss properties.
Sec. 103. Amendments to existing flood mitigation assistance program.
Sec. 104. FEMA authority to fund mitigation activities for individual
              repetitive claims properties.
Sec. 105. Amendments to additional coverage for compliance with land
              use and control measures.
Sec. 106. Actuarial rate properties.
Sec. 107. Geospatial digital flood hazard data.
Sec. 108. Replacement of mobile homes on original sites.
Sec. 109. Reiteration of FEMA responsibility to map mudslides.

                   TITLE II--MISCELLANEOUS PROVISIONS

Sec. 201. Definitions.
Sec. 202. Supplemental forms.
Sec. 203. Acknowledgement form.
Sec. 204. Flood insurance claims handbook.
Sec. 205. Appeal of decisions relating to flood insurance coverage.
Sec. 206. Study and report on use of cost compliance coverage.
Sec. 207. Minimum training and education requirements.
Sec. 208. GAO study and report.
Sec. 209. Prospective payment of flood insurance premiums.
Sec. 210. Report on changes to fee schedule or fee payment
              arrangements.

     SEC. 2. CONGRESSIONAL FINDINGS.

       The Congress finds that--
       (1) the national flood insurance program--
       (A) identifies the flood risk;
       (B) provides flood risk information to the public;
       (C) encourages State and local governments to make
     appropriate land use adjustments to constrict the development
     of land which is exposed to flood damage and minimize damage
     caused by flood losses; and
       (D) makes flood insurance available on a nationwide basis
     that would otherwise not be

[[Page S6817]]

     available, to accelerate recovery from floods, mitigate
     future losses, save lives, and reduce the personal and
     national costs of flood disasters;
       (2) the national flood insurance program insures
     approximately 4,400,000 policyholders;
       (3) approximately 48,000 properties currently insured under
     the program have experienced, within a 10-year period, 2 or
     more flood losses where each such loss exceeds the amount
     $1,000;
       (4) approximately 10,000 of these repetitive-loss
     properties have experienced either 2 or 3 losses that
     cumulatively exceed building value or 4 or more losses, each
     exceeding $1,000;
       (5) repetitive-loss properties constitute a significant
     drain on the resources of the national flood insurance
     program, costing about $200,000,000 annually;
       (6) repetitive-loss properties comprise approximately 1
     percent of currently insured properties but are expected to
     account for 25 to 30 percent of claims losses;
       (7) the vast majority of repetitive-loss properties were
     built before local community implementation of floodplain
     management standards under the program and thus are eligible
     for subsidized flood insurance;
       (8) while some property owners take advantage of the
     program allowing subsidized flood insurance without requiring
     mitigation action, others are trapped in a vicious cycle of
     suffering flooding, then repairing flood damage, then
     suffering flooding, without the means to mitigate losses or
     move out of harm's way;
       (9) mitigation of repetitive-loss properties through
     buyouts, elevations, relocations, or flood-proofing will
     produce savings for policyholders under the program and for
     Federal taxpayers through reduced flood insurance losses and
     reduced Federal disaster assistance;
       (10) a strategy of making mitigation offers aimed at high-
     priority repetitive-loss properties and shifting more of the
     burden of recovery costs to property owners who choose to
     remain vulnerable to repetitive flood damage can encourage
     property owners to take appropriate actions that reduce loss
     of life and property damage and benefit the financial
     soundness of the program;
       (11) the method for addressing repetitive-loss properties
     should be flexible enough to take into consideration
     legitimate circumstances that may prevent an owner from
     taking a mitigation action; and
       (12) focusing the mitigation and buy-out of repetitive loss
     properties upon communities and property owners that choose
     to voluntarily participate in a mitigation and buy-out
     program will maximize the benefits of such a program, while
     minimizing any adverse impact on communities and property
     owners.

           TITLE I--AMENDMENTS TO FLOOD INSURANCE ACT OF 1968

     SEC. 101. EXTENSION OF PROGRAM AND CONSOLIDATION OF
                   AUTHORIZATIONS.

       (a) Borrowing Authority.--The first sentence of section
     1309(a) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4016(a)), is amended by striking ``through December''
     and all that follows through ``, and'' and inserting
     ``through the date specified in section 1319, and''.
       (b) Authority for Contracts.--Section 1319 of the National
     Flood Insurance Act of 1968 (42 U.S.C. 4026), is amended by
     striking ``after'' and all that follows and inserting ``after
     September 30, 2008.''.
       (c) Emergency Implementation.--Section 1336(a) of the
     National Flood Insurance Act of 1968 (42 U.S.C. 4056(a)), is
     amended by striking ``during the period'' and all that
     follows through ``in accordance'' and inserting ``during the
     period ending on the date specified in section 1319, in
     accordance''.
       (d) Authorization of Appropriations for Studies.--Section
     1376(c) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4127(c)), is amended by striking ``through'' and all
     that follows and inserting ``through the date specified in
     section 1319, for studies under this title.''.

     SEC. 102. ESTABLISHMENT OF PILOT PROGRAM FOR MITIGATION OF
                   SEVERE REPETITIVE LOSS PROPERTIES.

       (a) In General.--The National Flood Insurance Act of 1968
     is amended by inserting after section 1361 (42 U.S.C. 4102)
     the following:

     ``SEC. 1361A. PILOT PROGRAM FOR MITIGATION OF SEVERE
                   REPETITIVE LOSS PROPERTIES.

       ``(a) Authority.--To the extent amounts are made available
     for use under this section, the Director may, subject to the
     limitations of this section, provide financial assistance to
     States and communities that decide to participate in the
     pilot program established under this section for taking
     actions with respect to severe repetitive loss properties (as
     such term is defined in subsection (b)) to mitigate flood
     damage to such properties and losses to the National Flood
     Insurance Fund from such properties.
       ``(b) Severe Repetitive Loss Property.--For purposes of
     this section, the term `severe repetitive loss property' has
     the following meaning:
       ``(1) Single-family properties.--In the case of a property
     consisting of 1 to 4 residences, such term means a property
     that--
       ``(A) is covered under a contract for flood insurance made
     available under this title; and
       ``(B) has incurred flood-related damage--
       ``(i) for which 4 or more separate claims payments have
     been made under flood insurance coverage under this title,
     with the amount of each such claim exceeding $5,000, and with
     the cumulative amount of such claims payments exceeding
     $20,000; or
       ``(ii) for which at least 2 separate claims payments have
     been made under such coverage, with the cumulative amount of
     such claims exceeding the value of the property.
       ``(2) Multifamily properties.--In the case of a property
     consisting of 5 or more residences, such term shall have such
     meaning as the Director shall by regulation provide.
       ``(c) Eligible Activities.--Amounts provided under this
     section to a State or community may be used only for the
     following activities:
       ``(1) Mitigation activities.--To carry out mitigation
     activities that reduce flood damages to severe repetitive
     loss properties, including elevation, relocation, demolition,
     and floodproofing of structures, and minor physical localized
     flood control projects, and the demolition and rebuilding of
     properties to at least Base Flood Elevation or greater, if
     required by any local ordinance.
       ``(2) Purchase.--To purchase severe repetitive loss
     properties, subject to subsection (g).
       ``(d) Matching Requirement.--
       ``(1) In general.--Except as provided in paragraph (2), in
     any fiscal year the Director may not provide assistance under
     this section to a State or community in an amount exceeding 3
     times the amount that the State or community certifies, as
     the Director shall require, that the State or community will
     contribute from non-Federal funds for carrying out the
     eligible activities to be funded with such assistance
     amounts.
       ``(2) Reduced community match.--With respect to any 1-year
     period in which assistance is made available under this
     section, the Director may adjust the contribution required
     under paragraph (1) by any State, and for the communities
     located in that State, to not less than 10 percent of the
     cost of the activities for each severe repetitive loss
     property for which grant amounts are provided if, for such
     year--
       ``(A) the State has an approved State mitigation plan
     meeting the requirements for hazard mitigation planning under
     section 322 of the Robert T. Stafford Disaster Relief and
     Emergency Assistance Act (42 U.S.C. 5165) that specifies how
     the State intends to reduce the number of severe repetitive
     loss properties; and
       ``(B) the Director determines, after consultation with the
     State, that the State has taken actions to reduce the number
     of such properties.
       ``(3) Non-federal funds.--For purposes of this subsection,
     the term `non-Federal funds' includes State or local agency
     funds, in-kind contributions, any salary paid to staff to
     carry out the eligible activities of the recipient, the value
     of the time and services contributed by volunteers to carry
     out such activities (at a rate determined by the Director),
     and the value of any donated material or building and the
     value of any lease on a building.
       ``(e) Notice of Mitigation Program.--
       ``(1) In general.--Upon selecting a State or community to
     receive assistance under subsection (a) to carry out eligible
     activities, the Director shall notify the owners of a severe
     repetitive loss property, in plain language, within that
     State or community--
       ``(A) that their property meets the definition of a severe
     repetitive loss property under this section;
       ``(B) that they may receive an offer of assistance under
     this section;
       ``(C) of the types of assistance potentially available
     under this section;
       ``(D) of the implications of declining such offer of
     assistance under this section; and
       ``(E) that there is a right to appeal under this section.
       ``(2) Identification of severe repetitive loss
     properties.--The Director shall take such steps as are
     necessary to identify severe repetitive loss properties, and
     submit that information to the relevant States and
     communities.
       ``(f) Standards for Mitigation Offers.--The program under
     this section for providing assistance for eligible activities
     for severe repetitive loss properties shall be subject to the
     following limitations:
       ``(1) Priority.--In determining the properties for which to
     provide assistance for eligible activities under subsection
     (c), the Director shall provide assistance for properties in
     the order that will result in the greatest amount of savings
     to the National Flood Insurance Fund in the shortest period
     of time, in a manner consistent with the allocation formula
     under paragraph (5).
       ``(2) Offers.--The Director shall provide assistance in a
     manner that permits States and communities to make offers to
     owners of severe repetitive loss properties to take eligible
     activities under subsection (c) as soon as practicable.
       ``(3) Consultation.--In determining for which eligible
     activities under subsection (c) to provide assistance with
     respect to a severe repetitive loss property, the relevant
     States and communities shall consult, to the extent
     practicable, with the owner of the property.
       ``(4) Deference to local mitigation decisions.--The
     Director shall not, by rule, regulation, or order, establish
     a priority for funding eligible activities under this section
     that gives preference to one type or category of eligible
     activity over any other type or category of eligible
     activity.
       ``(5) Allocation.--

[[Page S6818]]

       ``(A) In general.--Subject to subparagraphs (B) and (C), of
     the total amount made available for assistance under this
     section in any fiscal year, the Director shall allocate
     assistance to a State, and the communities located within
     that State, based upon the percentage of the total number of
     severe repetitive loss properties located within that State.
       ``(B) Redistribution.--Any funds allocated to a State, and
     the communities within the State, under subparagraph (A) that
     have not been obligated by the end of each fiscal year shall
     be redistributed by the Director to other States and
     communities to carry out eligible activities in accordance
     with this section.
       ``(C) Exception.--Of the total amount made available for
     assistance under this section in any fiscal year, 10 percent
     shall be made available to communities that--
       ``(i) contain one or more severe repetitive loss
     properties; and
       ``(ii) are located in States that receive little or no
     assistance, as determined by the Director, under the
     allocation formula under subparagraph (A).
       ``(6) Notice.--Upon making an offer to provide assistance
     with respect to a property for any eligible activity under
     subsection (c), the State or community shall notify each
     holder of a recorded interest on the property of such offer
     and activity.
       ``(g) Purchase Offers.--A State or community may take
     action under subsection (c)(2) to purchase a severe
     repetitive loss property only if the following requirements
     are met:
       ``(1) Use of property.--The State or community enters into
     an agreement with the Director that provides assurances that
     the property purchased will be used in a manner that is
     consistent with the requirements of section 404(b)(2)(B) of
     the Robert T. Stafford Disaster Relief and Emergency
     Assistance Act (42 U.S.C. 5170c(b)(2)(B)) for properties
     acquired, accepted, or from which a structure will be removed
     pursuant to a project provided property acquisition and
     relocation assistance under such section 404(b).
       ``(2) Offers.--The Director shall provide assistance in a
     manner that permits States and communities to make offers to
     owners of severe repetitive loss properties and of associated
     land to engage in eligible activities as soon as possible.
       ``(3) Purchase price.--The amount of purchase offer is not
     less than the greatest of--
       ``(A) the amount of the original purchase price of the
     property, when purchased by the holder of the current policy
     of flood insurance under this title;
       ``(B) the total amount owed, at the time the offer to
     purchase is made, under any loan secured by a recorded
     interest on the property; and
       ``(C) an amount equal to the fair market value of the
     property immediately before the most recent flood event
     affecting the property, or an amount equal to the current
     fair market value of the property.
       ``(4) Comparable housing payment.--If a purchase offer made
     under paragraph (2) is less than the cost of the homeowner-
     occupant to purchase a comparable replacement dwelling
     outside the flood hazard area in the same community, the
     Director shall make available an additional relocation
     payment to the homeowner-occupant to apply to the difference.
       ``(h) Increased Premiums in Cases of Refusal To Mitigate.--
       ``(1) In general.--In any case in which the owner of a
     severe repetitive loss property refuses an offer to take
     action under paragraph (1) or (2) of subsection (c) with
     respect to such property, the Director shall--
       ``(A) notify each holder of a recorded interest on the
     property of such refusal; and
       ``(B) notwithstanding subsections (a) through (c) of
     section 1308, thereafter the chargeable premium rate with
     respect to the property shall be the amount equal to 150
     percent of the chargeable rate for the property at the time
     that the offer was made, as adjusted by any other premium
     adjustments otherwise applicable to the property and any
     subsequent increases pursuant to paragraph (2) and subject to
     the limitation under paragraph (3).
       ``(2) Increased premiums upon subsequent flood damage.--
     Notwithstanding subsections (a) through (c) of section 1308,
     if the owner of a severe repetitive loss property does not
     accept an offer to take action under paragraph (1) or (2) of
     subsection (c) with respect to such property and a claim
     payment exceeding $1,500 is made under flood insurance
     coverage under this title for damage to the property caused
     by a flood event occurring after such offer is made,
     thereafter the chargeable premium rate with respect to the
     property shall be the amount equal to 150 percent of the
     chargeable rate for the property at the time of such flood
     event, as adjusted by any other premium adjustments otherwise
     applicable to the property and any subsequent increases
     pursuant to this paragraph and subject to the limitation
     under paragraph (3).
       ``(3) Limitation on increased premiums.--In no case may the
     chargeable premium rate for a severe repetitive loss property
     be increased pursuant to this subsection to an amount
     exceeding the applicable estimated risk premium rate for the
     area (or subdivision thereof) under section 1307(a)(1).
       ``(4) Treatment of deductibles.--Any increase in chargeable
     premium rates required under this subsection for a severe
     repetitive loss property may be carried out, to the extent
     appropriate, as determined by the Director, by adjusting any
     deductible charged in connection with flood insurance
     coverage under this title for the property.
       ``(5) Notice of continued offer.--Upon each renewal or
     modification of any flood insurance coverage under this title
     for a severe repetitive loss property, the Director shall
     notify the owner that the offer made pursuant to subsection
     (c) is still open.
       ``(6) Appeals.--
       ``(A) In general.--Any owner of a severe repetitive loss
     property may appeal a determination of the Director to take
     action under paragraph (1)(B) or (2) with respect to such
     property, based only upon the following grounds:
       ``(i) As a result of such action, the owner of the property
     will not be able to purchase a replacement primary residence
     of comparable value and that is functionally equivalent.
       ``(ii) Based on independent information, such as contractor
     estimates or appraisals, the property owner believes that the
     price offered for purchasing the property is not an accurate
     estimation of the value of the property, or the amount of
     Federal funds offered for mitigation activities, when
     combined with funds from non-Federal sources, will not cover
     the actual cost of mitigation.
       ``(iii) As a result of such action, the preservation or
     maintenance of any prehistoric or historic district, site,
     building, structure, or object included in, or eligible for
     inclusion in, the National Register of Historic Places will
     be interfered with, impaired, or disrupted.
       ``(iv) The flooding that resulted in the flood insurance
     claims described in subsection (b)(2) for the property
     resulted from significant actions by a third party in
     violation of Federal, State, or local law, ordinance, or
     regulation.
       ``(v) In purchasing the property, the owner relied upon
     flood insurance rate maps of the Federal Emergency Management
     Agency that were current at the time and did not indicate
     that the property was located in an area having special flood
     hazards.
       ``(vi) The owner of the property, based on independent
     information, such as contractor estimates or other
     appraisals, demonstrates that an alternative eligible
     activity under subsection (c) is at least as cost effective
     as the initial offer of assistance.
       ``(B) Procedure.--An appeal under this paragraph of a
     determination of the Director shall be made by filing, with
     the Director, a request for an appeal within 90 days after
     receiving notice of such determination. Upon receiving the
     request, the Director shall select, from a list of
     independent third parties compiled by the Director for such
     purpose, a party to hear such appeal. Within 90 days after
     filing of the request for the appeal, such third party shall
     review the determination of the Director and shall set aside
     such determination if the third party determines that the
     grounds under subparagraph (A) exist. During the pendency of
     an appeal under this paragraph, the Director shall stay the
     applicability of the rates established pursuant to paragraph
     (1)(B) or (2), as applicable.
       ``(C) Effect of final determination.--In an appeal under
     this paragraph--
       ``(i) if a final determination is made in favor of the
     property owner under subparagraph (A) exist, the third party
     hearing such appeal shall require the Director to reduce the
     chargeable risk premium rate for flood insurance coverage for
     the property involved in the appeal from the amount required
     under paragraph (1)(B) or (2) to the amount paid prior to the
     offer to take action under paragraph (1) or (2) of subsection
     (c); and
       ``(ii) if a final determination is made that the grounds
     under subparagraph (A) do not exist, the Director shall
     promptly increase the chargeable risk premium rate for such
     property to the amount established pursuant to paragraph
     (1)(B) or (2), as applicable, and shall collect from the
     property owner the amount necessary to cover the stay of the
     applicability of such increased rates during the pendency of
     the appeal.
       ``(D) Costs.--If the third party hearing an appeal under
     this paragraph is compensated for such service, the costs of
     such compensation shall be borne--
       ``(i) by the owner of the property requesting the appeal,
     if the final determination in the appeal is that the grounds
     under subparagraph (A) do not exist; and
       ``(ii) by the National Flood Insurance Fund, if such final
     determination is that the grounds under subparagraph (A) do
     exist.
       ``(E) Report.--Not later than 6 months after the date of
     the enactment of the Bunning-Bereuter-Blumenaur Flood
     Insurance Reform Act of 2004, the Director shall submit a
     report describing the rules, procedures, and administration
     for appeals under this paragraph to--
       ``(i) the Committee on Banking, Housing, and Urban Affairs
     of the Senate; and
       ``(ii) the Committee on Financial Services of the House of
     Representatives.
       ``(i) Discretionary Actions in Cases of Fraudulent
     Claims.--If the Director determines that a fraudulent claim
     was made under flood insurance coverage under this title for
     a severe repetitive loss property, the Director may--
       ``(1) cancel the policy and deny the provision to such
     policyholder of any new flood insurance coverage under this
     title for the property; or
       ``(2) refuse to renew the policy with such policyholder
     upon expiration and deny the

[[Page S6819]]

     provision of any new flood insurance coverage under this
     title to such policyholder for the property.
       ``(j) Rules.--
       ``(1) In general.--The Director shall, by rule--
       ``(A) subject to subsection (f)(4), develop procedures for
     the distribution of funds to States and communities to carry
     out eligible activities under this section; and
       ``(B) ensure that the procedures developed under paragraph
     (1)--
       ``(i) require the Director to notify States and communities
     of the availability of funding under this section, and that
     participation in the pilot program under this section is
     optional;
       ``(ii) provide that the Director may assist States and
     communities in identifying severe repetitive loss properties
     within States or communities;
       ``(iii) allow each State and community to select properties
     to be the subject of eligible activities, and the appropriate
     eligible activity to be performed with respect to each severe
     repetitive loss property; and
       ``(iv) require each State or community to submit a list of
     severe repetitive loss properties to the Director that the
     State or community would like to be the subject of eligible
     activities under this section.
       ``(2) Consultation.--Not later than 90 days after the date
     of enactment of this Act, the Director shall consult with
     State and local officials in carrying out paragraph (1)(A),
     and provide an opportunity for an oral presentation, on the
     record, of data and arguments from such officials.
       ``(k) Funding.--
       ``(1) In general.--Pursuant to section 1310(a)(8), the
     Director may use amounts from the National Flood Insurance
     Fund to provide assistance under this section in each of
     fiscal years 2005, 2006, 2007, 2008, and 2009, except that
     the amount so used in each such fiscal year may not exceed
     $40,000,000 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.
       ``(2) Administrative expenses.--Of the amounts made
     available under this subsection, the Director may use up to 5
     percent for expenses associated with the administration of
     this section.
       ``(l) Termination.--The Director may not provide assistance
     under this section to any State or community after September
     30, 2009.''.
       (b) Availability of National Flood Insurance Fund
     Amounts.--Section 1310(a) of the National Flood Insurance Act
     of 1968 (42 U.S.C. 4017(a)) is amended--
       (1) in paragraph (7), by striking ``and'' at the end; and
       (2) by striking paragraph (8) and inserting the following:
       ``(8) for financial assistance under section 1361A to
     States and communities for taking actions under such section
     with respect to severe repetitive loss properties, but only
     to the extent provided in section 1361A(i); and''.

     SEC. 103. AMENDMENTS TO EXISTING FLOOD MITIGATION ASSISTANCE
                   PROGRAM.

       (a) Standard for Approval of Mitigation Plans.--Section
     1366(e)(3) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4104c) is amended by adding at the end the following
     new sentence: ``The Director may approve only mitigation
     plans that give priority for funding to such properties, or
     to such subsets of properties, as are in the best interest of
     the National Flood Insurance Fund.''.
       (b) Priority for Mitigation Assistance.--Section 1366(e) of
     the National Flood Insurance Act of 1968 (42 U.S.C. 4104c) is
     amended by striking paragraph (4) and inserting the
     following:
       ``(4) Priority for mitigation assistance.--In providing
     grants under this subsection for mitigation activities, the
     Director shall give first priority for funding to such
     properties, or to such subsets of such properties as the
     Director may establish, that the Director determines are in
     the best interests of the National Flood Insurance Fund and
     for which matching amounts under subsection (f) are
     available.''.
       (c) Coordination With States and Communities.--Section 1366
     of the National Flood Insurance Act of 1968 (42 U.S.C. 4104c)
     is amended by adding at the end the following:
       ``(m) Coordination With States and Communities.--The
     Director shall, in consultation and coordination with States
     and communities take such actions as are appropriate to
     encourage and improve participation in the national flood
     insurance program of owners of properties, including owners
     of properties that are not located in areas having special
     flood hazards (the 100-year floodplain), but are located
     within flood prone areas.''.
       (d) Funding.--Section 1367 of the National Flood Insurance
     Act of 1968 (42 U.S.C. 4104d) is amended--
       (1) in subsection (b), by striking paragraph (1) and
     inserting the following:
       ``(1) in each fiscal year, amounts from the National Flood
     Insurance Fund not exceeding $40,000,000, to remain available
     until expended;'';
       (2) by redesignating subsections (c) and (d) as subsections
     (d) and (e), respectively; and
       (3) by inserting after subsection (b) the following:
       ``(c) Administrative Expenses.--The Director may use not
     more than 5 percent of amounts made available under
     subsection (b) to cover salaries, expenses, and other
     administrative costs incurred by the Director to make grants
     and provide assistance under sections 1366 and 1323.''.
       (e) Reduced Community Match.--Section 1366(g) of the
     National Flood Insurance Act of 1968 (42 U.S.C. 4104c(g)), is
     amended--
       (2) by redesignating paragraph (2) as paragraph (3); and
       (3) by inserting after paragraph (1) the following:
       ``(2) Reduced community match.--With respect to any 1-year
     period in which assistance is made available under this
     section, the Director may adjust the contribution required
     under paragraph (1) by any State, and for the communities
     located in that State, to not less than 10 percent of the
     cost of the activities for each severe repetitive loss
     property for which grant amounts are provided if, for such
     year--
       ``(A) the State has an approved State mitigation plan
     meeting the requirements for hazard mitigation planning under
     section 322 of the Robert T. Stafford Disaster Relief and
     Emergency Assistance Act (42 U.S.C. 5165) that specifies how
     the State intends to reduce the number of severe repetitive
     loss properties; and
       ``(B) the Director determines, after consultation with the
     State, that the State has taken actions to reduce the number
     of such properties.''.
       (f) National Flood Mitigation Fund.--Section 1366(b)(2) of
     the National Flood Insurance Act of 1968 (42 U.S.C.
     4104c(b)(2)), is amended by striking ``$1,500,000'' and
     inserting ``7.5 percent of the available funds under this
     section''.

     SEC. 104. FEMA AUTHORITY TO FUND MITIGATION ACTIVITIES FOR
                   INDIVIDUAL REPETITIVE CLAIMS PROPERTIES.

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

     ``SEC. 1323. GRANTS FOR REPETITIVE INSURANCE CLAIMS
                   PROPERTIES.

       ``(a) In General.--The Director may provide funding for
     mitigation actions that reduce flood damages to individual
     properties for which 1 or more claim payments for losses have
     been made under flood insurance coverage under this title,
     but only if the Director determines that--
       ``(1) such activities are in the best interest of the
     National Flood Insurance Fund; and
       ``(2) such activities cannot be funded under the program
     under section 1366 because--
       ``(A) the requirements of section 1366(g) are not being met
     by the State or community in which the property is located;
     or
       ``(B) the State or community does not have the capacity to
     manage such activities.
       ``(b) Priority for Worst-Case Properties.--In determining
     the properties for which funding is to be provided under this
     section, the Director shall consult with the States in which
     such properties are located and provide assistance for
     properties in the order that will result in the greatest
     amount of savings to the National Flood Insurance Fund in the
     shortest period of time.''.
       (b) Availability of National Flood Insurance Fund
     Amounts.--Section 1310(a) of the National Flood Insurance Act
     of 1968 (42 U.S.C. 4017(a)) is amended by adding at the end
     the following:
       ``(9) for funding, not to exceed $10,000,000 in any fiscal
     year, for mitigation actions under section 1323, except that,
     notwithstanding any other provision of this title, amounts
     made available pursuant to this paragraph shall not be
     subject to offsetting collections through premium rates for
     flood insurance coverage under this title.''.

     SEC. 105. AMENDMENTS TO ADDITIONAL COVERAGE FOR COMPLIANCE
                   WITH LAND USE AND CONTROL MEASURES.

       (a) Compliance With Land Use and Control Measures.--Section
     1304(b) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4011(b)) is amended--
       (1) in the matter preceding paragraph (1)--
       (A) by striking ``compliance'' and inserting ``implementing
     measures that are consistent''; and
       (B) by inserting ``by the community'' after
     ``established'';
       (2) in paragraph (2), by striking ``have flood damage in
     which the cost of repairs equals or exceeds 50 percent of the
     value of the structure at the time of the flood event; and''
     and inserting ``are substantially damaged structures;''
       (3) in paragraph (3), by striking ``compliance with land
     use and control measures.'' and inserting ``the
     implementation of such measures; and''; and
       (4) by inserting after paragraph (3) and before the last
     undesignated paragraph the following:
       ``(4) properties for which an offer of mitigation
     assistance is made under--
       ``(A) section 1366 (Flood Mitigation Assistance Program);
       ``(B) section 1368 (Repetitive Loss Priority Program and
     Individual Priority Property Program);
       ``(C) the Hazard Mitigation Grant Program authorized under
     section 404 of the Robert T. Stafford Disaster Assistance and
     Emergency Relief Act (42 U.S.C. 5170c);
       ``(D) the Predisaster Hazard Mitigation Program under
     section 203 of the Robert T. Stafford Disaster Assistance and
     Emergency Relief Act (42 U.S.C. 5133); and
       ``(E) any programs authorized or for which funds are
     appropriated to address any unmet needs or for which
     supplemental funds are made available.''.

[[Page S6820]]

       (b) Definitions.--Section 1370(a) of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4121(a)) is amended--
       (1) by striking paragraph (7) and inserting the following:
       ``(7) the term `repetitive loss structure' means a
     structure covered by a contract for flood insurance that--
       ``(A) has incurred flood-related damage on 2 occasions, in
     which the cost of repair, on the average, equaled or exceeded
     25 percent of the value of the structure at the time of each
     such flood event; and
       ``(B) at the time of the second incidence of flood-related
     damage, the contract for flood insurance contains increased
     cost of compliance coverage.'';
       (2) in paragraph (13), by striking ``and'' at the end;
       (3) in paragraph (14), by striking the period and inserting
     ``; and''; and
       (4) by adding at the end the following:
       ``(15) the term `substantially damaged structure' means a
     structure covered by a contract for flood insurance that has
     incurred damage for which the cost of repair exceeds an
     amount specified in any regulation promulgated by the
     Director, or by a community ordinance, whichever is lower.''.

     SEC. 106. ACTUARIAL RATE PROPERTIES.

       (a) In General.--Section 1308 of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4015) is amended by striking
     subsection (c) and inserting the following:
       ``(c) Actuarial Rate Properties.--Subject only to the
     limitations provided under paragraphs (1) and (2), the
     chargeable rate shall not be less than the applicable
     estimated risk premium rate for such area (or subdivision
     thereof) under section 1307(a)(1) with respect to the
     following properties:
       ``(1) Post-firm properties.--Any property the construction
     or substantial improvement of which the Director determines
     has been started after December 31, 1974, or started after
     the effective date of the initial rate map published by the
     Director under paragraph (2) of section 1360 for the area in
     which such property is located, whichever is later, except
     that the chargeable rate for properties under this paragraph
     shall be subject to the limitation under subsection (e).
       ``(2) Certain leased coastal and river properties.--Any
     property leased from the Federal Government (including
     residential and nonresidential properties) that the Director
     determines is located on the river-facing side of any dike,
     levee, or other riverine flood control structure, or seaward
     of any seawall or other coastal flood control structure.''.
       (b) Inapplicability of Annual Limitations on Premium
     Increases.--Section 1308(e) of the National Flood Insurance
     Act of 1968 (42 U.S.C. 4015(e)) is amended by striking
     ``Notwithstanding'' and inserting ``Except with respect to
     properties described under paragraph (2) or (3) of subsection
     (c), and notwithstanding''.

     SEC. 107. GEOSPATIAL DIGITAL FLOOD HAZARD DATA.

       For the purposes of flood insurance and floodplain
     management activities conducted pursuant to the National
     Flood Insurance Program under the National Flood Insurance
     Act of 1968 (42 U.S.C. 4001 et seq.), geospatial digital
     flood hazard data distributed by the Federal Emergency
     Management Agency, or its designee, or the printed products
     derived from that data, are interchangeable and legally
     equivalent for the determination of the location of 1 in 100
     year and 1 in 500 year flood planes, provided that all other
     geospatial data shown on the printed product meets or exceeds
     any accuracy standard promulgated by the Federal Emergency
     Management Agency.

     SEC. 108. REPLACEMENT OF MOBILE HOMES ON ORIGINAL SITES.

       Section 1315 of the National Flood Insurance Act of 1968
     (42 U.S.C. 4022) is amended by adding at the end the
     following:
       ``(c) Replacement of Mobile Homes on Original Sites.--
       ``(1) Community participation.--The placement of any mobile
     home on any site shall not affect the eligibility of any
     community to participate in the flood insurance program under
     this title and the Flood Disaster Protection Act of 1973
     (notwithstanding that such placement may fail to comply with
     any elevation or flood damage mitigation requirements), if--
       ``(A) such mobile home was previously located on such site;
       ``(B) such mobile home was relocated from such site because
     of flooding that threatened or affected such site; and
       ``(C) such replacement is conducted not later than the
     expiration of the 180-day period that begins upon the
     subsidence (in the area of such site) of the body of water
     that flooded to a level considered lower than flood levels.
       ``(2) Definition.--For purposes of this subsection, the
     term `mobile home' has the meaning given such term in the law
     of the State in which the mobile home is located.''.

     SEC. 109. REITERATION OF FEMA RESPONSIBILITY TO MAP
                   MUDSLIDES.

       As directed in section 1360(b) of the National Flood
     Insurance Act of 1968 (42 U.S.C. 4101(b)), the Director of
     the Federal Emergency Management Agency is again directed to
     accelerate the identification of risk zones within flood-
     prone and mudslide-prone areas, as provided by subsection
     (a)(2) of such section 1360, in order to make known the
     degree of hazard within each such zone at the earliest
     possible date.

                   TITLE II--MISCELLANEOUS PROVISIONS

     SEC. 201. DEFINITIONS.

       In this title, the following definitions shall apply:
       (1) Director.--The term ``Director'' means the Director of
     the Federal Emergency Management Agency.
       (2) Flood insurance policy.--The term ``flood insurance
     policy'' means a flood insurance policy issued under the
     National Flood Insurance Act of 1968 (42 U.S.C. et seq.).
       (3) Program.--The term ``Program'' means the National Flood
     Insurance Program established under the National Flood
     Insurance Act of 1968 (42 U.S.C. 4001 et seq.).

     SEC. 202. SUPPLEMENTAL FORMS.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop
     supplemental forms to be issued in conjunction with the
     issuance of a flood insurance policy that set forth, in
     simple terms--
       (1) the exact coverages being purchased by a policyholder;
       (2) any exclusions from coverage that apply to the
     coverages purchased;
       (3) an explanation, including illustrations, of how lost
     items and damages will be valued under the policy at the time
     of loss;
       (4) the number and dollar value of claims filed under a
     flood insurance policy over the life of the property, and the
     effect, under the National Flood Insurance Act of 1968 (42
     U.S.C. 4001 et seq.), of the filing of any further claims
     under a flood insurance policy with respect to that property;
     and
       (5) any other information that the Director determines will
     be helpful to policyholders in understanding flood insurance
     coverage.
       (b) Distribution.--The forms developed under subsection (a)
     shall be given to--
       (1) all holders of a flood insurance policy at the time of
     purchase and renewal; and
       (2) insurance companies and agents that are authorized to
     sell flood insurance policies.

     SEC. 203. ACKNOWLEDGEMENT FORM.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop an
     acknowledgement form to be signed by the purchaser of a flood
     insurance policy that contains--
       (1) an acknowledgement that the purchaser has received a
     copy of the standard flood insurance policy, and any forms
     developed under section 202; and
       (2) an acknowledgement that the purchaser has been told
     that the contents of a property or dwelling are not covered
     under the terms of the standard flood insurance policy, and
     that the policyholder has the option to purchase additional
     coverage for such contents.
       (b) Distribution.--Copies of an acknowledgement form
     executed under subsection (a) shall be made available to the
     purchaser and the Director.

     SEC. 204. FLOOD INSURANCE CLAIMS HANDBOOK.

       (a) In General.--Not later than 6 months after the date of
     enactment of this Act, the Director shall develop a flood
     insurance claims handbook that contains--
       (1) a description of the procedures to be followed to file
     a claim under the Program, including how to pursue a claim to
     completion;
       (2) how to file supplementary claims, proof of loss, and
     any other information relating to the filing of claims under
     the Program; and
       (3) detailed information regarding the appeals process
     established under section 205.
       (b) Distribution.--The handbook developed under subsection
     (a) shall be made available to--
       (1) each insurance company and agent authorized to sell
     flood insurance policies; and
       (2) each purchaser, at the time of purchase and renewal, of
     a flood insurance policy, and at the time of any flood loss
     sustained by such purchaser.

     SEC. 205. APPEAL OF DECISIONS RELATING TO FLOOD INSURANCE
                   COVERAGE.

       Not later than 6 months after the date of enactment of this
     Act, the Director shall, by regulation, establish an appeals
     process through which holders of a flood insurance policy may
     appeal the decisions, with respect to claims, proofs of loss,
     and loss estimates relating to such flood insurance policy,
     of--
       (1) any insurance agent or adjuster, or insurance company;
     or
       (2) any employee or contractor of the Federal Emergency
     Management Agency.

     SEC. 206. STUDY AND REPORT ON USE OF COST COMPLIANCE
                   COVERAGE.

       Not later than 1 year after the date of enactment of this
     Act, the Director of the Federal Emergency Management Agency
     shall submit to Congress a report that sets forth--
       (1) the use of cost of compliance coverage under section
     1304(b) of the National Flood Insurance Act of 1968 (42
     U.S.C. 4011(b)) in connection with flood insurance policies;
       (2) any barriers to policyholders using the funds provided
     by cost of compliance coverage under that section 1304(b)
     under a flood insurance policy, and recommendations to
     address those barriers; and
       (3) the steps that the Federal Emergency Management Agency
     has taken to ensure that funds paid for cost of compliance
     coverage under that section 1304(b) are being used to lessen
     the burdens on all homeowners and the Program.

     SEC. 207. MINIMUM TRAINING AND EDUCATION REQUIREMENTS.

       The Director of the Federal Emergency Management Agency
     shall, in cooperation with the insurance industry, State
     insurance regulators, and other interested parties--

[[Page S6821]]

       (1) establish minimum training and education requirements
     for all insurance agents who sell flood insurance policies;
     and
       (2) not later than 6 months after the date of enactment of
     this Act, publish these requirements in the Federal Register,
     and inform insurance companies and agents of the
     requirements.

     SEC. 208. GAO STUDY AND REPORT.

       (a) Study.--The Comptroller General of the United States
     shall conduct a study of--
       (1) the adequacy of the scope of coverage provided under
     flood insurance policies in meeting the intended goal of
     Congress that flood victims be restored to their pre-flood
     conditions, and any recommendations to ensure that goal is
     being met;
       (2) the adequacy of payments to flood victims under flood
     insurance policies; and
       (3) the practices of the Federal Emergency Management
     Agency and insurance adjusters in estimating losses incurred
     during a flood, and how such practices affect the adequacy of
     payments to flood victims.
       (b) Report.--Not later than 1 year after the date of
     enactment of this Act, the Comptroller General shall submit
     to Congress a report regarding the results of the study under
     subsection (a).

     SEC. 209. PROSPECTIVE PAYMENT OF FLOOD INSURANCE PREMIUMS.

       Section 1308 of the National Flood Insurance Act of 1968
     (42 U.S.C. 4015) is amended by adding at the end the
     following:
       ``(f) Adjustment of Premium.--Notwithstanding any other
     provision of law, if the Director determines that the holder
     of a flood insurance policy issued under this Act is paying a
     lower premium than is required under this section due to an
     error in the flood plain determination, the Director may only
     prospectively charge the higher premium rate.''.

     SEC. 210. REPORT ON CHANGES TO FEE SCHEDULE OR FEE PAYMENT
                   ARRANGEMENTS.

       Not later than 3 months after the date of enactment of this
     Act, the Director shall submit a report on any changes or
     modifications made to the fee schedule or fee payment
     arrangements between the Federal Emergency Management Agency
     and insurance adjusters who provide services with respect to
     flood insurance policies to--
       (1) the Committee on Banking, Housing, and Urban Affairs of
     the Senate; and
       (2) the Committee on Financial Services of the House of
     Representatives.

                          ____________________