,,ii #aaeth ,,congress #ast ,session ,s4 #aejg ,,in ,,the ,,senate ,,of ,,the ,,united ,,states ,june #bi1 #bjag ,mr4 ,reed 7for himself1 ,mr4 ,kennedy1 and ,mr4 ,menendez7 introduced the following bill2 which was read twice and referred to the ,committee on ,banking1 ,housing1 and ,urban ,affairs ,a ,,bill ,to amend the ,national ,flood ,insurance ,act of #aifh to allow the ,administrator of the ,federal ,emergency ,management ,agency to provide capitalization grants to ,states to establish revolving funds to provide funding assistance to reduce flood risks1 and for other purposes4 #a4 ,short title ,this ,act may be cited as the ,state ,flood ,mitigation ,revolving ,fund ,act of #bjag4 #b4 ,state revolving loan funds for flood mitigation ,chapter ,i of the ,national ,flood ,insurance ,act of #aifh 7#db ,u4,s4,c4 #djaa et seq47 is amended by adding at the end the following3 #acbf4 ,state revolving loan funds for flood mitigation 7a7 ,definitions ,in this section-- 7#a7 the term ,community ,rating ,system means the community rating system carried out under section #acae7;b72 7#b7 the term eligible ,state means a ,state1 the ,district of ,columbia1 and the ,commonwealth of ,puerto ,rico2 7#c7 the term insular area means-- 7,a7 ,guam2 7,b7 ,american ,samoa2 7,c7 the ,commonwealth of the ,northern ,mariana ,islands2 7,d7 the ,federated ,states of ,micronesia2 7,e7 the ,republic of the ,marshall ,islands2 7,f7 the ,republic of ,palau2 and 7,g7 the ,united ,states ,virgin ,islands2 7#d7 the term intended use plan means a plan prepared under subsection 7d77#a72 7#e7 the term low-income geographic area means an area described in paragraph 7#a7 or 7#b7 of section #cja7;a7 of the ,public ,works and ,economic ,development ,act of #aife 7#db ,u4,s4,c4 #cafa7;a772 7#f7 the term low-income homeowner means the owner of a primary residence1 the household income of which in a taxable year is not more than #aej percent of the national median household income2 7#g7 the term participating ,state means an eligible ,state that-- 7,a7 has entered into an agreement under subsection 7b77#a72 and 7,b7 agrees to comply with the requirements of this section2 7#h7 the term pre-,,firm building means a building for which construction or substantial improvement occurred before the effective date of the initial ,flood ,insurance ,rate ,map published by the ,administrator under section #acfj for the area in which the building is located2 7#i7 the term repetitive loss structure has the meaning given the term in section #acgj7;a72 7#aj7 the term severe repetitive loss property has the meaning given the term in section #acjg7;h72 7#aa7 the term ,state loan fund means a flood mitigation assistance revolving loan fund established by an eligible ,state under this section2 and 7#ab7 the term tribal government means the recognized government of an ,indian tribe1 or the governing body of an ,alaska ,native regional or village corporation1 that has been determined eligible to receive services from the ,bureau of ,indian ,affairs4 7b7 ,general authority 7#a7 ,in general ,the ,administrator may enter into an agreement with an eligible ,state to provide a capitalization grant for the eligible ,state to establish a revolving fund that will provide funding assistance to help homeowners1 businesses1 nonprofit organizations1 and communities reduce flood risk in order to decrease-- 7,a7 the loss of life and property2 7,b7 the cost of flood insurance2 and 7,c7 ,federal disaster payments4 7#b7 ,timing of deposit and agreements for distribution of funds 7,a7 ,in general ,not later than the last day of the fiscal year following the fiscal year in which a capitalization grant is made to a participating ,state under paragraph 7#a71 the participating ,state shall-- 7i7 deposit the grant in the ,state loan fund of the ,state2 and 7ii7 enter into one or more agreements to distribute the grant funds for purposes authorized under subsection 7c74 7,b7 ,noncompliance ,except as provided in subparagraph 7,c71 if a participating ,state does not comply with subparagraph 7,a7 with respect to a grant1 the ,administrator shall reallocate the grant in accordance with paragraph 7#c77;,b74 7,c7 ,exception ,the ,administrator may not reallocate any funds under subparagraph 7,b7 to a participating ,state that violated subparagraph 7,a7 with respect to a grant made during the same fiscal year in which the funds to be reallocated were originally made available4 7#c7 ,allocation 7,a7 ,in general ,the ,administrator shall allocate amounts made available to carry out this section to participating ,states-- 7i7 for the participating ,states to deposit in the ,state loan funds established by the participating ,states2 and 7ii7 except as provided in paragraph 7#f71 in accordance with the requirements described in subparagraph 7,b74 7,b7 ,requirements ,the requirements described in this subparagraph are as follows3 7i7 ,fifty percent of the total amount made available under subparagraph 7,a7 shall be allocated so that each participating ,state receives the percentage amount that is obtained by dividing the number of properties that were insured under the national flood insurance program in that ,state in the fiscal year preceding the fiscal year in which the amount is allocated by the total number of properties that were insured under the national flood insurance program in the fiscal year preceding the fiscal year in which the amount is allocated4 7ii7 ,fifty percent of the total amount made available under subparagraph 7,a7 shall be allocated so that each participating ,state receives a percentage of funds that is equal to the product obtained under clause 7iii77,,iv7 with respect to that participating ,state after following the procedures described in clause 7iii74 7iii7 ,the procedures described in this clause are as follows3 7,i7 ,divide the total amount collected in premiums for properties insured under the national flood insurance program in each participating ,state during the previous fiscal year by the number of properties insured under the national flood insurance program in that ,state for that fiscal year4 7,,ii7 ,add together each quotient obtained under subclause 7,i74 7,,iii7 ,for each participating ,state1 divide the quotient obtained under subclause 7,i7 with respect to that ,state by the sum obtained under subclause 7,,ii74 7,,iv7 ,for each participating ,state1 multiply the amount that is #ej percent of the total amount made available under subparagraph 7,a7 by the quotient obtained under subclause 7,,iii74 7iv7 ,except as provided in paragraph 7#e71 in a fiscal year-- 7,i7 a participating ,state may not receive more than #ae percent of the total amount that is made available under subparagraph 7,a7 in that fiscal year2 and 7,,ii7 if a participating ,state1 based on the requirements under clauses 7i7 through 7iii71 would1 but for the limit under subclause 7,i7 of this clause1 receive an amount that is greater than the amount the ,state is authorized to receive under that subclause1 the difference between the authorized amount and the amount otherwise due to the ,state under clauses 7i7 through 7iii7 shall be allocated to other participating ,states-- 7aa7 that1 in that fiscal year1 have not received an amount under subparagraph 7,a7 that is more than the authorized amount under subclause 7,i7 of this clause2 and 7bb7 by using the requirements under clauses 7i7 through 7iii71 except that a participating ,state may receive an allocation under this subclause only if the allocation does not result in the ,state receiving a total amount for the fiscal year under subparagraph 7,a7 that is greater than the authorized amount under subclause 7,i74 7#d7 ,no revolving fund required 7,a7 ,in general ,notwithstanding any other provision of this section1 and subject to subparagraph 7,b71 a participating ,state that receives less than #d1jjj1jjj under paragraph 7#c77;,b7 in a fiscal year may distribute the funds directly in the form of grants or technical assistance for a purpose described in subsection 7c77#b71 without regard to whether the ,state has established a ,state loan fund4 7,b7 ,state matching ,a participating ,state that exercises the authority under subparagraph 7,a7 in a fiscal year shall provide matching funds from non-,federal sources in an amount that is equal to #be percent of the amount that the ,state receives under paragraph 7#c77;,b7 in that fiscal year for purposes described in subparagraph 7,a74 7#e7 ,allocation of remaining funds ,after allocating amounts made available to carry out this section for a fiscal year in accordance with paragraph 7#c71 the ,administrator shall allocate any remaining amounts made available for that fiscal year to participating ,states1 using the procedures described in clauses 7i7 through 7iii7 of paragraph 7#c77;,b74 7#f7 ,reservation of funds ,the ,administrator shall reserve not more than #a4e percent of the amount made available to carry out this section in a fiscal year-- 7,a7 for administrative costs incurred in carrying out this section2 7,b7 to provide technical assistance to recipients of grants under this section2 and 7,c7 to enter into grant agreements with tribal governments and insular areas1 with the grant funds to be distributed-- 7i7 according to criteria established by the ,administrator2 and 7ii7 for a purpose described in subsection 7c77#b74 7c7 ,use of funds 7#a7 ,in general ,amounts deposited in a ,state loan fund1 including repayments of loans made from the fund and interest earned on the amounts in the fund1 shall be used-- 7,a7 consistent with paragraphs 7#b7 and 7#c7 and subsection 7g71 to provide financial assistance for-- 7i7 homeowners1 businesses1 and nonprofit organizations that are eligible to participate in the national flood insurance program2 and 7ii7 any local government that participates in the national flood insurance program2 7,b7 as a source of revenue and security for leveraged loans1 the proceeds of which shall be deposited in the ,state loan fund2 or 7,c7 for the sale of bonds as security for payment of the principal and interest on revenue or general obligation bonds issued by the participating ,state to provide matching funds under subsection 7g71 if the proceeds from the sale of the bonds are deposited in the ,state loan fund4 7#b7 ,purposes ,a recipient of financial assistance provided through amounts from a ,state loan fund-- 7,a7 shall use the amounts to reduce-- 7i7 flood risk2 or 7ii7 potential ,federal disaster assistance or claims submitted under the national flood insurance program2 7,b7 shall use the amounts in a cost-effective manner under requirements established by the ,state1 which may require an applicant for financial assistance to submit a cost-benefit analysis before the date on which the applicant receives the assistance2 7,c7 shall use the amounts for projects that-- 7i7 are located in communities that-- 7,i7 participate in the national flood insurance program2 and 7,,ii7 have developed a local hazard mitigation plan that has been approved by the ,administrator under section #acff2 7ii7 7,i7 address a repetitive loss structure or a severe repetitive loss property2 or 7,,ii7 address flood risk in the #ejj-year floodplain1 areas of residual flood risk1 or other areas of potential flood risk1 as identified by the ,administrator2 and 7iii7 address current risk and anticipate future risk1 such as sea-level rise2 7,d7 may use the amounts-- 7i7 for projects relating to-- 7,i7 structural elevation2 7,,ii7 floodproofing2 7,,iii7 the relocation or removal of buildings from the #ajj-year floodplain or other areas of flood risk1 including the acquisition of properties for such a purpose2 7,,iv7 environmental restoration activities that directly reduce flood risk2 7,v7 any eligible activity described in subparagraphs 7,a7 through 7,g7 of section #acff7;c77#c72 or 7,,vi7 other activities determined appropriate by the ,administrator2 7ii7 with respect to a project described in clause 7i71 only for expenditures directly related to a project described in that clause1 including expenditures for planning1 design1 and associated pre-construction activities2 and 7iii7 to acquire1 for the purposes of permanent protection1 land1 buildings1 or a conservation easement from a willing seller or grantor2 and 7,e7 may not use the amounts-- 7i7 to construct buildings or expand existing buildings2 7ii7 to improve any structure without a commitment by the recipient to maintain flood insurance coverage for the structure1 regardless of any change in ownership2 7iii7 to improve a residential property with an appraised value that is not less than #abe percent of the limitation on the maximum original principal obligation of a conventional mortgage that may be purchased by the ,federal ,national ,mortgage ,association or the ,federal ,home ,loan ,mortgage ,corporation in the area in which the property is located1 as established under section #cjb7;b77#b7 of the ,federal ,national ,mortgage ,association ,charter ,act 7#ab ,u4,s4,c4 #agag7;b77#b77 and section #cje7;a77#b7 of the ,federal ,home ,loan ,mortgage ,corporation ,act 7#ab ,u4,s4,c4 #aded7;a77#b772 7iv7 for the benefit of a homeowner if the annual household adjusted gross income of the homeowner during the previous fiscal year was not less than #bjj1jjj1 as annually adjusted by the ,administrator to reflect changes in the ,consumer ,price ,index for ,all ,urban ,consumers1 as published by the ,bureau of ,labor ,statistics of the ,department of ,labor and rounded to the nearest #be2 or 7v7 to acquire real property or an interest in real property unless the property is purchased from a willing seller4 7d7 ,intended use plans 7#a7 ,in general ,after providing the opportunity for public review and comment1 each participating ,state shall annually prepare a plan that identifies1 for the year following the date of issuance of the intended use plan1 the intended uses of the amounts available in the ,state loan fund of the participating ,state4 7#b7 ,consultation during preparation ,each participating ,state1 in preparing an intended use plan1 shall ensure that the ,state agency with primary responsibility for floodplain management-- 7,a7 provides oversight with respect to the preparation of the intended use plan2 and 7,b7 consults with any other appropriate ,state agency1 including agencies responsible for coastal and environmental management4 7#c7 ,contents ,a participating ,state shall1 in each intended use plan-- 7,a7 include-- 7i7 an explanation of the mitigation and resiliency benefits the ,state intends to achieve1 including by-- 7,i7 reducing future damage and loss associated with flooding2 7,,ii7 reducing the number of severe repetitive loss properties and repetitive loss structures in the ,state2 7,,iii7 decreasing the number of flood insurance claims in the ,state2 and 7,,iv7 increasing the rating under the ,community ,rating ,system for communities in the ,state2 7ii7 information with respect to the availability of1 and the application process for receiving1 financial assistance from the ,state loan fund of the ,state2 7iii7 the criteria and methods established for the distribution of amounts from the ,state loan fund of the ,state2 7iv7 the amount of financial assistance that the ,state anticipates allocating to-- 7,i7 local government projects2 and 7,,ii7 projects for homeowners1 business1 or nonprofit organizations2 7v7 the expected terms of the assistance provided under clause 7iv72 and 7vi7 a description of the financial status of the ,state loan fund and the short-term and long-term goals of the ,state loan fund2 and 7,b7 provide1 to the maximum extent practicable1 that priority for the use of amounts from the ,state loan fund shall be given to projects that-- 7i7 address severe repetitive loss properties and repetitive loss structures2 7ii7 assist low-income homeowners and low-income geographic areas2 and 7iii7 address flood risk for pre-,,firm buildings4 7#d7 ,publication ,each participating ,state shall publish and periodically update a list of all projects receiving funding from the ,state loan fund of the ,state1 which shall include-- 7,a7 the location of each project2 7,b7 the type and amount of assistance provided for each project2 and 7,c7 the expected funding schedule and date of completion of each project4 7e7 ,fund management ,amounts in a ,state loan fund shall-- 7#a7 remain available for providing financial assistance under this section until distributed2 7#b7 if the amounts are not required for immediate distribution or expenditure1 be invested in interest-bearing obligations2 and 7#c7 except as provided in subsection 7i71 include only-- 7,a7 amounts received from capitalization grants made under this section2 7,b7 repayments of loans made from the fund2 and 7,c7 interest earned on amounts in the fund4 7f7 ,matching funds ,on or before the date on which a participating ,state receives a capitalization grant1 the ,state shall deposit into the ,state loan fund of the ,state1 in addition to the amount of the capitalization grant1 an amount from non-,federal sources that is not less than #bj percent of the total amount of the capitalization grant4 7g7 ,types of assistance ,unless otherwise prohibited by ,state law1 a participating ,state may use the amounts deposited into a ,state loan fund under this section only-- 7#a7 to make a loan1 on the condition that-- 7,a7 the interest rate for the loan is not more than the market interest rate2 7,b7 the recipient of the loan will begin making principal and interest payments on the loan not later than #a year after the date on which the project for which the loan was made is completed2 7,c7 the loan will be fully amortized not later than #bj years after the date on which the project for which the loan was made is completed1 except that1 in the case of a loan made for a project in a low-income geographic area or to a low-income homeowner1 the ,state may provide a longer amortization period for the loan if that longer period-- 7i7 ends on a date that is not later than #cj years after the date on which the project is completed2 and 7ii7 is not longer than the expected design life of the project2 7,d7 the recipient of the loan demonstrates that there is a dedicated source of revenue or adequate income to repay the loan2 and 7,e7 payments of principal and interest with respect to the loan will be deposited into the ,state loan fund2 7#b7 to buy or refinance the debt obligation of a local government at an interest rate that is not more than the market interest rate2 7#c7 to guarantee1 or purchase insurance for1 a local obligation1 the proceeds of which finance a project eligible for assistance under this section1 if the guarantee or purchase1 as applicable1 would-- 7,a7 improve credit market access2 or 7,b7 reduce the interest rate with respect to the obligation2 7#d7 as a source of revenue or as security for the payment of principal and interest on revenue or general obligation bonds issued by the ,state if the proceeds of the sale of the bonds will be deposited into the ,state loan fund2 or 7#e7 to earn interest on those amounts4 7h7 ,assistance for low-,income homeowners and low-,income geographic areas 7#a7 ,in general ,notwithstanding any other provision of this section1 if a participating ,state uses amounts from a ,state loan fund to provide financial assistance under subsection 7c7 in a low-income geographic area or to a low-income homeowner1 the ,state may provide additional subsidization to the recipient of the assistance1 including forgiveness of the principal of a loan4 7#b7 ,limitation ,for each fiscal year1 the total amount of additional subsidization provided by a participating ,state under paragraph 7#a7 may not exceed #cj percent of the amount of the capitalization grant allocated to the ,state for that fiscal year4 7i7 ,administration of fund 7#a7 ,in general ,a participating ,state may combine the financial administration of a ,state loan fund with the financial administration of any other revolving fund established by the ,state if-- 7,a7 combining the administration of the funds would-- 7i7 be convenient and avoid administrative costs2 and 7ii7 not violate the law of the ,state2 and 7,b7 the ,administrator determines that-- 7i7 amounts obtained from a grant made under this section1 amounts obtained from the repayment of a loan made from a ,state loan fund1 and interest earned on amounts in a ,state loan fund will be-- 7,i7 accounted for separately from amounts from other revolving funds2 and 7,,ii7 used only for purposes authorized under this section2 and 7ii7 after consulting with the appropriate ,state agencies1 the authority to establish assistance priorities and carry out oversight and related activities1 other than financial administration1 with respect to flood assistance remains with the ,state agency with primary responsibility for floodplain management4 7#b7 ,administrative and technical costs 7,a7 ,in general ,for each fiscal year1 a participating ,state may use the amount described in subparagraph 7,b7 to-- 7i7 pay the reasonable costs of administration of the programs under this section1 including the recovery of reasonable costs incurred in establishing a ,state loan fund2 7ii7 provide appropriate oversight of projects authorized under this section2 and 7iii7 provide technical assistance and outreach to recipients in the ,state of amounts under this section1 including with respect to updating hazard mitigation plans and participating in the ,community ,rating ,system1 in an amount that is not more than #d percent of the funds made available to the ,state under this section4 7,b7 ,description ,the amount described in this subparagraph is an amount equal to the sum of-- 7i7 any fees collected by a participating ,state to recover the costs described in subparagraph 7,a77i71 regardless of the source2 and 7ii7 the greatest of-- 7,i7 #djj1jjj2 7,,ii7 #a_/e of #a percent of the value of the ,state loan fund of a ,state1 as of the date on which the valuation is made2 and 7,,iii7 an amount equal to #g percent of all grant awards made to a participating ,state for the ,state loan fund of the ,state under this section for the fiscal year4 7#c7 ,audit and report 7,a7 ,audit requirement ,not less frequently than biennially1 each participating ,state shall conduct an audit of the ,state loan fund of the ,state4 7,b7 ,report ,each participating ,state shall submit to the ,administrator a biennial report regarding the activities of the ,state under this section during the period covered by the report1 including-- 7i7 the result of any audit conducted by the ,state under subparagraph 7,a72 and 7ii7 a review of the effectiveness of the ,state loan fund of the ,state with respect to-- 7,i7 the intended use plans of the ,state2 and 7,,ii7 meeting the objectives described in subsection 7b77#a74 7#d7 ,oversight ,in conducting oversight with respect to ,state loan funds established under this section1 the ,administrator-- 7,a7 shall-- 7i7 periodically audit the funds in accordance with procedures established by the ,comptroller ,general of the ,united ,states2 and 7ii7 not less frequently than once every #d years1 review each ,state loan fund to determine the effectiveness of the fund in reducing flood risk2 and 7,b7 may1 at any time-- 7i7 make recommendations to a participating ,state with respect to the administration of the ,state loan fund of the ,state2 or 7ii7 require specific changes with respect to a ,state loan fund in order to improve the effectiveness of the fund4 7j7 ,regulations ,the ,administrator shall promulgate such guidance or regulations as may be necessary to carry out this section1 including guidance or regulations that-- 7#a7 ensure that each participating ,state to which funds are allocated under this section uses the funds as efficiently as possible2 7#b7 reduce1 to the maximum extent practicable1 waste1 fraud1 and abuse with respect to the implementation of this section2 and 7#c7 require any party that receives funds directly or indirectly under this section1 including a participating ,state and a recipient of amounts from a ,state loan fund1 to use procedures with respect to the management of the funds that conform to generally accepted accounting standards4 7k7 ,authorization of appropriations ,there are authorized to be appropriated such sums as may be necessary to carry out this section for fiscal years #bjah through #bjbg4 4