State Flood Mitigation Revolving Fund Act of 2019

I 116TH CONGRESS 1ST SESSION H. R. 1610 To amend the National Flood Insurance Act of 1968 to allow the Adminis- trator of the Federal Emergency Management Agency to provide capital- ization grants to States to establish revolving funds to provide funding assistance to reduce flood risks, and for other purposes. IN THE HOUSE OF REPRESENTATIVES MARCH 7, 2019 Mr. CRIST (for himself and Mr. WILLIAMS) introduced the following bill; which was referred to the Committee on Financial Services A BILL To amend the National Flood Insurance Act of 1968 to allow the Administrator of the Federal Emergency Man- agement Agency to provide capitalization grants to States to establish revolving funds to provide funding assistance to reduce flood risks, and for other purposes. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘State Flood Mitigation 4 Revolving Fund Act of 2019’’. 5 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 2 •HR 1610 IH SEC. 2. STATE REVOLVING LOAN FUNDS FOR FLOOD MITI- 1 GATION. 2 Chapter I of the National Flood Insurance Act of 3 1968 (42 U.S.C. 4011 et seq.) is amended by adding at 4 the end the following: 5 ‘‘SEC. 1326. STATE REVOLVING LOAN FUNDS FOR FLOOD 6 MITIGATION. 7 ‘‘(a) DEFINITIONS.—In this section— 8 ‘‘(1) the term ‘Community Rating System’ 9 means the community rating system carried out 10 under section 1315(b); 11 ‘‘(2) the term ‘eligible State’ means a State, the 12 District of Columbia, and the Commonwealth of 13 Puerto Rico; 14 ‘‘(3) the term ‘insular area’ means— 15 ‘‘(A) Guam; 16 ‘‘(B) American Samoa; 17 ‘‘(C) the Commonwealth of the Northern 18 Mariana Islands; 19 ‘‘(D) the Federated States of Micronesia; 20 ‘‘(E) the Republic of the Marshall Islands; 21 ‘‘(F) the Republic of Palau; and 22 ‘‘(G) the United States Virgin Islands; 23 ‘‘(4) the term ‘intended use plan’ means a plan 24 prepared under subsection (d)(1); 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 3 •HR 1610 IH ‘‘(5) the term ‘low-income geographic area’ 1 means an area described in paragraph (1) or (2) of 2 section 301(a) of the Public Works and Economic 3 Development Act of 1965 (42 U.S.C. 3161(a)); 4 ‘‘(6) the term ‘low-income homeowner’ means 5 the owner of a primary residence, the household in- 6 come of which in a taxable year is not more than 80 7 percent of the median income for the area in which 8 the residence is located; 9 ‘‘(7) the term ‘participating State’ means an el- 10 igible State that— 11 ‘‘(A) has entered into an agreement under 12 subsection (b)(1); and 13 ‘‘(B) agrees to comply with the require- 14 ments of this section; 15 ‘‘(8) the term ‘pre-FIRM building’ means a 16 building for which construction or substantial im- 17 provement occurred before the effective date of the 18 initial Flood Insurance Rate Map published by the 19 Administrator under section 1360 for the area in 20 which the building is located; 21 ‘‘(9) the term ‘repetitive loss structure’ has the 22 meaning given the term in section 1370(a); 23 ‘‘(10) the term ‘severe repetitive loss property’ 24 has the meaning given the term in section 1307(h); 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 4 •HR 1610 IH ‘‘(11) the term ‘State loan fund’ means a flood 1 mitigation assistance revolving loan fund established 2 by an eligible State under this section; and 3 ‘‘(12) the term ‘tribal government’ means the 4 recognized government of an Indian tribe, or the 5 governing body of an Alaska Native regional or vil- 6 lage corporation, that has been determined eligible 7 to receive services from the Bureau of Indian Af- 8 fairs. 9 ‘‘(b) GENERAL AUTHORITY.— 10 ‘‘(1) IN GENERAL.—The Administrator may 11 enter into an agreement with an eligible State to 12 provide a capitalization grant for the eligible State 13 to establish a revolving fund that will provide fund- 14 ing assistance to help homeowners, businesses, non- 15 profit organizations, and communities reduce flood 16 risk in order to decrease— 17 ‘‘(A) the loss of life and property; 18 ‘‘(B) the cost of flood insurance; and 19 ‘‘(C) Federal disaster payments. 20 ‘‘(2) TIMING OF DEPOSIT AND AGREEMENTS 21 FOR DISTRIBUTION OF FUNDS.— 22 ‘‘(A) IN GENERAL.—Not later than the 23 last day of the fiscal year following the fiscal 24 year in which a capitalization grant is made to 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 5 •HR 1610 IH a participating State under paragraph (1), the 1 participating State shall— 2 ‘‘(i) deposit the grant in the State 3 loan fund of the State; and 4 ‘‘(ii) enter into one or more binding 5 agreements that provide for the State to 6 distribute the grant funds for purposes au- 7 thorized under subsection (c) such that— 8 ‘‘(I) in the case of the initial 9 grant made under this section to a 10 State, not less than 75 percent of the 11 amount of the grant funds shall be 12 distributed before the expiration of 13 the 24-month period beginning upon 14 deposit of such funds in the State 15 loan fund of the State; and 16 ‘‘(II) in the case of any subse- 17 quent grant made under this section 18 to a State, not less than 90 percent of 19 the amount of the grant funds made 20 under the capitalization grant shall be 21 distributed before the expiration of 22 the 12-month period beginning upon 23 deposit of such funds in the State 24 loan fund of the State. 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 6 •HR 1610 IH ‘‘(B) NONCOMPLIANCE.—Except as pro- 1 vided in subparagraph (C), if a participating 2 State does not comply with subparagraph (A) 3 with respect to a grant, the Administrator shall 4 reallocate the grant in accordance with para- 5 graph (3)(B). 6 ‘‘(C) EXCEPTION.—The Administrator 7 may not reallocate any funds under subpara- 8 graph (B) to a participating State that violated 9 subparagraph (A) with respect to a grant made 10 during the same fiscal year in which the funds 11 to be reallocated were originally made available. 12 ‘‘(3) ALLOCATION.— 13 ‘‘(A) IN GENERAL.—The Administrator 14 shall allocate amounts made available to carry 15 out this section to participating States— 16 ‘‘(i) for the participating States to de- 17 posit in the State loan funds established by 18 the participating States; and 19 ‘‘(ii) except as provided in paragraph 20 (6), in accordance with the requirements 21 described in subparagraph (B). 22 ‘‘(B) REQUIREMENTS.—The requirements 23 described in this subparagraph are as follows: 24 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 7 •HR 1610 IH ‘‘(i) Fifty percent of the total amount 1 made available under subparagraph (A) 2 shall be allocated so that each partici- 3 pating State receives the percentage 4 amount that is obtained by dividing the 5 number of properties that were insured 6 under the national flood insurance pro- 7 gram in that State in the fiscal year pre- 8 ceding the fiscal year in which the amount 9 is allocated by the total number of prop- 10 erties that were insured under the national 11 flood insurance program in the fiscal year 12 preceding the fiscal year in which the 13 amount is allocated. 14 ‘‘(ii) Fifty percent of the total amount 15 made available under subparagraph (A) 16 shall be allocated so that each partici- 17 pating State receives a percentage of funds 18 that is equal to the product obtained under 19 clause (iii)(IV) with respect to that partici- 20 pating State after following the procedures 21 described in clause (iii). 22 ‘‘(iii) The procedures described in this 23 clause are as follows: 24 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 8 •HR 1610 IH ‘‘(I) Divide the total amount col- 1 lected in premiums for properties in- 2 sured under the national flood insur- 3 ance program in each participating 4 State during the previous fiscal year 5 by the number of properties insured 6 under the national flood insurance 7 program in that State for that fiscal 8 year. 9 ‘‘(II) Add together each quotient 10 obtained under subclause (I). 11 ‘‘(III) For each participating 12 State, divide the quotient obtained 13 under subclause (I) with respect to 14 that State by the sum obtained under 15 subclause (II). 16 ‘‘(IV) For each participating 17 State, multiply the amount that is 50 18 percent of the total amount made 19 available under subparagraph (A) by 20 the quotient obtained under subclause 21 (III). 22 ‘‘(4) NO REVOLVING FUND REQUIRED.— 23 ‘‘(A) IN GENERAL.—Notwithstanding any 24 other provision of this section, and subject to 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 9 •HR 1610 IH subparagraph (B), a participating State that 1 receives less than $4,000,000 under paragraph 2 (3)(B) in a fiscal year may distribute the funds 3 directly in the form of grants or technical as- 4 sistance for a purpose described in subsection 5 (c)(2), without regard to whether the State has 6 established a State loan fund. 7 ‘‘(B) STATE MATCHING.—A participating 8 State that exercises the authority under sub- 9 paragraph (A) in a fiscal year shall provide 10 matching funds from non-Federal sources in an 11 amount that is equal to 25 percent of the 12 amount that the State receives under paragraph 13 (3)(B) in that fiscal year for purposes described 14 in subparagraph (A). 15 ‘‘(5) ALLOCATION OF REMAINING FUNDS.— 16 After allocating amounts made available to carry out 17 this section for a fiscal year in accordance with 18 paragraph (3), the Administrator shall allocate any 19 remaining amounts made available for that fiscal 20 year to participating States, using the procedures 21 described in clauses (i) through (iii) of paragraph 22 (3)(B). 23 ‘‘(6) ALLOCATION FOR TRIBAL GOVERNMENTS 24 AND INSULAR AREAS.—The Administrator shall re- 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 10 •HR 1610 IH serve not less than 5.0 percent of the amount made 1 available to carry out this section in a fiscal year to 2 enter into grant agreements with tribal governments 3 and insular areas, with the grant funds to be distrib- 4 uted— 5 ‘‘(A) according to criteria established by 6 the Administrator; and 7 ‘‘(B) for a purpose described in subsection 8 (c)(2). 9 ‘‘(7) ADMINISTRATIVE COSTS; TECHNICAL AS- 10 SISTANCE.—The Administrator shall reserve not 11 more than 1.5 percent of the amount made available 12 to carry out this section in a fiscal year— 13 ‘‘(A) for administrative costs incurred in 14 carrying out this section; and 15 ‘‘(B) to provide technical assistance to re- 16 cipients of grants under this section. 17 ‘‘(c) USE OF FUNDS.— 18 ‘‘(1) IN GENERAL.—Amounts deposited in a 19 State loan fund, including repayments of loans made 20 from the fund and interest earned on the amounts 21 in the fund, shall be used— 22 ‘‘(A) consistent with paragraphs (2) and 23 (3) and subsection (g), to provide financial as- 24 sistance for— 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 11 •HR 1610 IH ‘‘(i) homeowners, businesses, and non- 1 profit organizations that are eligible to 2 participate in the national flood insurance 3 program; and 4 ‘‘(ii) any local government that par- 5 ticipates in the national flood insurance 6 program; 7 ‘‘(B) as a source of revenue and security 8 for leveraged loans, the proceeds of which shall 9 be deposited in the State loan fund; or 10 ‘‘(C) for the sale of bonds as security for 11 payment of the principal and interest on rev- 12 enue or general obligation bonds issued by the 13 participating State to provide matching funds 14 under subsection (g), if the proceeds from the 15 sale of the bonds are deposited in the State 16 loan fund. 17 ‘‘(2) PURPOSES.—A recipient of financial as- 18 sistance provided through amounts from a State 19 loan fund— 20 ‘‘(A) shall use the amounts to reduce— 21 ‘‘(i) flood risk; or 22 ‘‘(ii) potential flood claims submitted 23 under the national flood insurance pro- 24 gram; 25 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00011 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 12 •HR 1610 IH ‘‘(B) shall use the amounts in a cost-effec- 1 tive manner under requirements established by 2 the State, which may require an applicant for 3 financial assistance to submit any information 4 that the State considers relevant or necessary 5 before the date on which the applicant receives 6 the assistance; 7 ‘‘(C) shall use the amounts for projects 8 that— 9 ‘‘(i) meet design and construction 10 standards established by the Adminis- 11 trator; 12 ‘‘(ii) are located in communities 13 that— 14 ‘‘(I) participate in the national 15 flood insurance program; and 16 ‘‘(II) have developed a State, 17 local, or tribal government hazard 18 mitigation plan that has been ap- 19 proved by the Administrator under 20 section 1366; 21 ‘‘(iii)(I) address a repetitive loss 22 structure or a severe repetitive loss prop- 23 erty; or 24 VerDate Sep 11 2014 18:09 Mar 21, 2019 Jkt 089200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H1610.IH H1610 pamtmann on DSKBFK8HB2PROD with BILLS 13 •HR 1610 IH ‘‘(II) address flood risk in the 500- 1 year floodplain, areas of residual flood risk, 2 or other areas of potential flood risk, as 3 identified by the Administrator; and 4 ‘‘(iv) address current risk and antici- 5 pate future risk, such as sea-level rise; 6 ‘‘(D) may use the amounts— 7 ‘‘(i) for projects relating to— 8 ‘‘(I) structural elevation; 9 ‘‘(II) floodproofing; 10 ‘‘(III) the relocation or removal 11 of buildings from the 100-year flood- 12 plain or other areas of flood risk, in- 13 cluding the acquisition of properties 14 for such a purpose; 15 ‘‘(IV) environmental restoration 16 activities that directly reduce flood 17 risk; 18 ‘‘(V) any [Text truncated for display. 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