To improve the Office of the Flood Insurance Advocate.

SA 4706. Ms. LANDRIEU (for herself and Mr. Nelson of Florida)
submitted an amendment intended to be proposed by her to the bill S.
2284, to amend the National Flood Insurance Act of 1968, to restore the
financial solvency of the flood insurance fund, and for other purposes;
which was ordered to lie on the table; as follows:

Strike section 31 and insert the following:

SEC. 31. FLOOD INSURANCE ADVOCATE.

Chapter II of the National Flood Insurance Act of 1968 is
amended by inserting after section 1330 (42 U.S.C. 4041) the
following new section:

``SEC. 1330A. OFFICE OF THE FLOOD INSURANCE ADVOCATE.

``(a) Establishment of Position.--
``(1) In general.--There shall be in the Federal Emergency
Management Agency an Office of the Flood Insurance Advocate
which shall be headed by the National Flood Insurance
Advocate. The National Flood Insurance Advocate shall--
``(A) to the extent amounts are provided pursuant to
subsection (n), be compensated at the same rate as the
highest rate of basic pay established for the Senior
Executive Service under section 5382 of title 5, United
States Code, or, if the Director so determines, at a rate
fixed under section 9503 of such title;
``(B) be appointed by the Director without regard to
political affiliation;
``(C) report to and be under the general supervision of the
Director, but shall not report to, or be subject to
supervision by, any other officer of the Federal Emergency
Management Agency; and
``(D) consult with the Assistant Administrator for
Mitigation or any successor thereto, but shall not report to,
or be subject to the general supervision by, the Assistant
Administrator for Mitigation or any successor thereto.
``(2) Qualifications.--An individual appointed under
paragraph (1)(B) shall have a background in customer service,
accounting, auditing, financial analysis, law, management
analysis, public administration, investigations, or
insurance.
``(3) Restriction on employment.--An individual may be
appointed as the National Flood Insurance Advocate only if
such individual was not an officer or employee of the Federal
Emergency Management Agency with duties relating to the
national flood insurance program during the 2-year period
ending with such appointment and such individual agrees not
to accept any employment with the Federal Emergency
Management Agency for at least 2 years after ceasing to be
the National Flood Insurance Advocate. Service as an employee
of the National Flood Insurance Advocate shall not be taken
into account in applying this paragraph.
``(4) Staff.--To the extent amounts are provided pursuant
to subsection (n), the National Flood Insurance Advocate may
employ such personnel as may be necessary to carry out the
duties of the Office.
``(5) Independence.--The Director shall not prevent or
prohibit the National Flood Insurance Advocate from
initiating, carrying out, or completing any audit or
investigation, or from issuing any subpoena or summons during
the course of any audit or investigation.
``(6) Removal.--The President and the Director shall have
the power to remove, discharge, or dismiss the National Flood
Insurance Advocate. Not later than 15 days after the removal,
discharge, or dismissal of the Advocate, the President or the
Director shall report to the Committee on Banking of the
Senate and the Committee on Financial Services of the House
of Representatives on the basis for such removal, discharge,
or dismissal.
``(b) Functions of Office.--It shall be the function of the
Office of the Flood Insurance Advocate to--
``(1) assist insureds under the national flood insurance
program in resolving problems with the Federal Emergency
Management Agency relating to such program;
``(2) identify areas in which such insureds have problems
in dealings with the Federal

[[Page S3822]]

Emergency Management Agency relating to such program;
``(3) propose changes in the administrative practices of
the Federal Emergency Management Agency to mitigate problems
identified under paragraph (2);
``(4) identify potential legislative, administrative, or
regulatory changes which may be appropriate to mitigate such
problems;
``(5) conduct, supervise, and coordinate--
``(A) systematic and random audits and investigations of
insurance companies and associated entities that sell or
offer for sale insurance policies against loss resulting from
physical damage to or loss of real property or personal
property related thereto arising from any flood occurring in
the United States, to determine whether such insurance
companies or associated entities are allocating only flood
losses under such insurance policies to the National Flood
Insurance Program;
``(B) audits and investigations to determine if an
insurance company or associated entity described under
subparagraph (A) is negotiating on behalf of the National
Flood Insurance Program with third parties in good faith;
``(C) examinations to ensure that insurance companies and
associated entities are properly compiling and preserving
documentation for independent biennial financial statement
audits as required under section 62.23(l) of title 44, Code
of Federal Regulations; and
``(D) any other audit, examination, or investigation that
the National Flood Insurance Advocate determines necessary to
ensure the effective and efficient operation of the national
flood insurance program;
``(6) conduct, supervise, and coordinate investigations
into the operations of the national flood insurance program
for the purpose of--
``(A) promoting economy and efficiency in the
administration of such program;
``(B) preventing and detecting fraud and abuse in the
program; and
``(C) identifying, and referring to the Attorney General
for prosecution, any participant in such fraud or abuse;
``(7) identify and investigate conflicts of interest that
undermine the economy and efficiency of the national flood
insurance program; and
``(8) investigate allegations of consumer fraud.
``(c) Authority of the National Flood Insurance Advocate.--
The National Flood Insurance Advocate may--
``(1) have access to all records, reports, audits, reviews,
documents, papers, recommendations, or other material
available to the Director which relate to administration or
operation of the national flood insurance program with
respect to which the National Flood Insurance Advocate has
responsibilities under this section;
``(2) undertake such investigations and reports relating to
the administration or operation of the national flood
insurance program as are, in the judgment of the National
Flood Insurance Advocate, necessary or desirable;
``(3) request such information or assistance as may be
necessary for carrying out the duties and responsibilities
provided by this section from any Federal, State, or local
governmental agency or unit thereof;
``(4) require by subpoena the production of all
information, documents, reports, answers, records (including
phone records), accounts, papers, emails, hard drives, backup
tapes, software, audio or visual aides, and any other data
and documentary evidence necessary in the performance of the
functions assigned to the National Flood Insurance Advocate
by this section, which subpoena, in the case of contumacy or
refusal to obey, shall be enforceable by order of any
appropriate United States district court, provided, that
procedures other than subpoenas shall be used by the National
Flood Insurance Advocate to obtain documents and information
from any Federal agency;
``(5) issue a summons to compel the testimony of any person
in the employ of any insurance company or associated entity,
described under subsection (b)(5)(A), or any successor to
such company or entity, including any member of the board of
such company or entity, any trustee of such company or
entity, any partner in such company or entity, or any agent
or representative of such company or entity;
``(6) administer to or take from any person an oath,
affirmation, or affidavit, whenever necessary in the
performance of the functions assigned by this section, which
oath, affirmation, or affidavit when administered or taken by
or before an employee of the Office designated by the
National Flood Insurance Advocate shall have the same force
and effect as if administered or taken by or before an
officer having a seal;
``(7) have direct and prompt access to the Director when
necessary for any purpose pertaining to the performance of
functions and responsibilities under this section;
``(8) select, appoint, and employ such officers and
employees as may be necessary for carrying out the functions,
powers, and duties of the Office subject to the provisions of
title 5, United States Code, governing appointments in the
competitive service, and the provisions of chapter 51 and
subchapter III of chapter 53 of such title relating to
classification and General Schedule pay rates;
``(9) obtain services as authorized by section 3109 of
title 5, United States Code, at daily rates not to exceed the
equivalent rate prescribed for the rate of basic pay for a
position at level IV of the Executive Schedule; and
``(10) to the extent and in such amounts as may be provided
in advance by appropriations Acts, enter into contracts and
other arrangements for audits, studies, analyses, and other
services with public agencies and with private persons, and
to make such payments as may be necessary to carry out the
provisions of this section.
``(d) Additional Duties of the NFIA.--The National Flood
Insurance Advocate shall--
``(1) monitor the coverage and geographic allocation of
regional offices of flood insurance advocates;
``(2) develop guidance to be distributed to all Federal
Emergency Management Agency officers and employees having
duties with respect to the national flood insurance program,
outlining the criteria for referral of inquiries by insureds
under such program to regional offices of flood insurance
advocates;
``(3) ensure that the local telephone number for each
regional office of the flood insurance advocate is published
and available to such insureds served by the office; and
``(4) establish temporary State or local offices where
necessary to meet the needs of qualified insureds following a
flood event.
``(e) Other Responsibilities.--
``(1) Additional requirements relating to certain audits.--
Prior to conducting any audit or investigation relating to
the allocation of flood losses under subsection (b)(5)(A),
the National Flood Insurance Advocate shall--
``(A) consult with appropriate subject-matter experts to
identify the data necessary to determine whether flood claims
paid by insurance companies or associated entities on behalf
the national flood insurance program reflect damages caused
by flooding;
``(B) collect or compile the data identified in
subparagraph (A), utilizing existing data sources to the
maximum extent practicable; and
``(C) establish policies, procedures, and guidelines for
application of such data in all audits and investigations
authorized under this section.
``(2) Annual reports.--
``(A) Activities.--Not later than December 31 of each
calendar year, the National Flood Insurance Advocate shall
report to the Committee on Banking, Housing, and Urban
Affairs of the Senate and the Committee on Financial Services
of the House of Representatives on the activities of the
Office of the Flood Insurance Advocate during the fiscal year
ending during such calendar year. Any such report shall
contain a full and substantive analysis of such activities,
in addition to statistical information, and shall--
``(i) identify the initiatives the Office of the Flood
Insurance Advocate has taken on improving services for
insureds under the national flood insurance program and
responsiveness of the Federal Emergency Management Agency
with respect to such initiatives;
``(ii) describe the nature of recommendations made to the
Director under subsection (i);
``(iii) contain a summary of the most serious problems
encountered by such insureds, including a description of the
nature of such problems;
``(iv) contain an inventory of any items described in
clauses (i), (ii), and (iii) for which action has been taken
and the result of such action;
``(v) contain an inventory of any items described in
clauses (i), (ii), and (iii) for which action remains to be
completed and the period during which each item has remained
on such inventory;
``(vi) contain an inventory of any items described in
clauses (i), (ii), and (iii) for which no action has been
taken, the period during which each item has remained on such
inventory and the reasons for the inaction;
``(vii) identify any Flood Insurance Assistance
Recommendation which was not responded to by the Director in
a timely manner or was not followed, as specified under
subsection (i);
``(viii) contain recommendations for such administrative
and legislative action as may be appropriate to resolve
problems encountered by such insureds;
``(ix) identify areas of the law or regulations relating to
the national flood insurance program that impose significant
compliance burdens on such insureds or the Federal Emergency
Management Agency, including specific recommendations for
remedying these problems;
``(x) identify the most litigated issues for each category
of such insureds, including recommendations for mitigating
such disputes;
``(xi) identify ways to promote the economy, efficiency,
and effectiveness in the administration of the national flood
insurance program;
``(xii) identify fraud and abuse in the national flood
insurance program; and
``(xiii) include such other information as the National
Flood Insurance Advocate may deem advisable.
``(B) Direct submission of report.--Each report required
under this paragraph shall be provided directly to the
committees identified in subparagraph (A) without any prior
review or comment from the Director, the Secretary of
Homeland Security, or any other officer or employee of the
Federal Emergency Management Agency or the Department of
Homeland Security, or the Office of Management and Budget.
``(3) Information and assistance from other agencies.--

[[Page S3823]]

``(A) In general.--Upon request of the National Flood
Insurance Advocate for information or assistance under this
section, the head of any Federal agency shall, insofar as is
practicable and not in contravention of any statutory
restriction or regulation of the Federal agency from which
the information is requested, furnish to the National Flood
Insurance Advocate, or to an authorized designee of the
National Flood Insurance Advocate, such information or
assistance.
``(B) Refusal to comply.--Whenever information or
assistance requested under this subsection is, in the
judgment of the National Flood Insurance Advocate,
unreasonably refused or not provided, the National Flood
Insurance Advocate shall report the circumstances to the
Director without delay.
``(f) Compliance With GAO Standards.--In carrying out the
responsibilities established under this section, the National
Flood Insurance Advocate shall--
``(1) comply with standards established by the Comptroller
General of the United States for audits of Federal
establishments, organizations, programs, activities, and
functions;
``(2) establish guidelines for determining when it shall be
appropriate to use non-Federal auditors;
``(3) take appropriate steps to assure that any work
performed by non-Federal auditors complies with the standards
established by the Comptroller General as described in
paragraph (1); and
``(4) take the necessary steps to minimize the publication
of proprietary and trade secrets information.
``(g) Personnel Actions.--
``(1) In general.--The National Flood Insurance Advocate
shall have the responsibility and authority to--
``(A) appoint regional flood insurance advocates in a
manner that will provide appropriate coverage based upon
regional flood insurance program participation; and
``(B) hire, evaluate, and take personnel actions (including
dismissal) with respect to any employee of any regional
office of a flood insurance advocate described in
subparagraph (A).
``(2) Consultation.--The National Flood Insurance Advocate
may consult with the appropriate supervisory personnel of the
Federal Emergency Management Agency in carrying out the
National Flood Insurance Advocate's responsibilities under
this subsection.
``(h) Operation of Regional Offices.--
``(1) In general.--Each regional flood insurance advocate
appointed pursuant to subsection (d)--
``(A) shall report to the National Flood Insurance Advocate
or delegate thereof;
``(B) may consult with the appropriate supervisory
personnel of the Federal Emergency Management Agency
regarding the daily operation of the regional office of the
flood insurance advocate;
``(C) shall, at the initial meeting with any insured under
the national flood insurance program seeking the assistance
of a regional office of the flood insurance advocate, notify
such insured that the flood insurance advocate offices
operate independently of any other Federal Emergency
Management Agency office and report directly to Congress
through the National Flood Insurance Advocate; and
``(D) may, at the flood insurance advocate's discretion,
not disclose to the Director contact with, or information
provided by, such insured.
``(2) Maintenance of independent communications.--Each
regional office of the flood insurance advocate shall
maintain a separate phone, facsimile, and other electronic
communication access.
``(i) Flood Insurance Assistance Recommendations.--
``(1) Authority to issue.--Upon application filed by a
qualified insured with the Office of the Flood Insurance
Advocate (in such form, manner, and at such time as the
Director shall by regulation prescribe), the National Flood
Insurance Advocate may issue a Flood Insurance Assistance
Recommendation, if the Advocate finds that the qualified
insured is suffering a significant hardship, such as a
significant delay in resolving claims where the insured is
incurring significant costs as a result of such delay, or
where the insured is at risk of adverse action, including the
loss of property, as a result of the manner in which the
flood insurance laws are being administered by the Director.
``(2) Terms of a flood insurance assistance
recommendation.--The terms of a Flood Insurance Assistance
Recommendation may recommend to the Director that the
Director, within a specified time period, cease any action,
take any action as permitted by law, or refrain from taking
any action, including the payment of claims, with respect to
the qualified insured under any other provision of law which
is specifically described by the National Flood Insurance
Advocate in such recommendation.
``(3) Director response.--Not later than 15 days after the
receipt of any Flood Insurance Assistance Recommendation
under this subsection, the Director shall respond in writing
as to--
``(A) whether such recommendation was followed;
``(B) why such recommendation was or was not followed; and
``(C) what, if any, additional actions were taken by the
Director to prevent the hardship indicated in such
recommendation.
``(4) Responsibilities of director.--The Director shall
establish procedures requiring a formal response consistent
with the requirements of paragraph (3) to all recommendations
submitted to the Director by the National Flood Insurance
Advocate under this subsection.
``(j) Reporting of Potential Criminal Violations.--In
carrying out the duties and responsibilities established
under this section, the National Flood Insurance Advocate
shall report expeditiously to the Attorney General whenever
the National Flood Insurance Advocate has reasonable grounds
to believe there has been a violation of Federal criminal
law.
``(k) Coordination.--
``(1) With other federal agencies.--In carrying out the
duties and responsibilities established under this section,
the National Flood Insurance Advocate--
``(A) shall give particular regard to the activities of the
Inspector General of the Department of Homeland Security with
a view toward avoiding duplication and insuring effective
coordination and cooperation; and
``(B) may participate, upon request of the Inspector
General of the Department of Homeland Security, in any audit
or investigation conducted by the Inspector General.
``(2) With state regulators.--In carrying out any
investigation or audit under this section, the National Flood
Insurance Advocate shall coordinate its activities and
efforts with any State insurance authority that is
concurrently undertaking a similar or related investigation
or audit.
``(3) Avoidance of redundancies in the resolution of
problems.--In providing any assistance to a policyholder
pursuant to paragraphs (1) and (2) of subsection (b), the
National Flood Insurance Advocate shall consult with the
Director to eliminate, avoid, or reduce any redundancies in
actions that may arise as a result of the actions of the
National Flood Insurance Advocate and the claims appeals
process described under section 62.20 of title 44, Code of
Federal Regulations.
``(l) Authority of the Director to Levy Penalties.--In
addition to any other action that may be taken by the
Attorney General, upon a finding in any investigation or
audit conducted by the Office of the National Flood Insurance
Advocate under this section, that any insurance company or
associated entity has willfully misappropriated funds under
the national flood insurance program, the Director may levy a
civil fine against such company or entity in an amount not to
exceed 3 times the total amount of funds shown to be
misappropriated.
``(m) Definitions.--For purposes of this subsection:
``(1) Associated entity.--The term `associated entity'
means any person, corporation, or other legal entity that
contracts with the Director or an insurance company to
provide adjustment services, benefits calculation services,
claims services, processing services, or record keeping
services in connection with standard flood insurance policies
made available under the national flood insurance program.
``(2) Insurance company.--The term `insurance company'
refers to any property and casualty insurance company that is
authorized by the Director to participate in the Write Your
Own program under the national flood insurance program.
``(3) National flood insurance advocate.--The term
`National Flood Insurance Advocate' includes any designee of
the National Flood Insurance Advocate.
``(4) Qualified insured.--The term `qualified insured'
means an insured under coverage provided under the national
flood insurance program under this title.
``(n) Funding.--Pursuant to section 1310(a)(8), the
Director may use amounts from the National Flood Insurance
Fund to fund the activities of the Office of the Flood
Advocate in each of fiscal years 2009 through 2014, except
that the amount so used in each such fiscal year may not
exceed $5,000,000 and shall remain available until expended.
Notwithstanding any other provision of this title, amounts
made available pursuant to this subsection shall not be
subject to offsetting collections through premium rates for
flood insurance coverage under this title.''.
______