HR6934-119

What This Bill Does

The National Flood Insurance Program Affordability Act creates premium assistance for NFIP policyholders. Within one year, FEMA must establish a means-tested program providing graduated discounts for eligible covered properties so an eligible household’s chargeable premium rate may not exceed 1 percent of area median income. Eligibility covers residential policyholders with household income up to 120 percent of area median income, small businesses with not more than 100 employees that satisfy FEMA’s hardship metric, and not-for-profit organizations satisfying that metric. FEMA must issue regulations and guidance, including the hardship metric, and report to Congress on whether eligibility could be based on principal, interest, taxes, and insurance rather than income as a share of area median income, and how other federal-program income eligibility could be used. FEMA must also implement monthly NFIP premium installments within 180 days or explain to Congress why it cannot.

Who Benefits and How

Low- and moderate-income homeowners in flood-prone areas benefit because assistance can cap NFIP premiums relative to area median income. Small businesses with not more than 100 employees benefit if they meet FEMA’s hardship metric and receive graduated discounts. Nonprofit organizations with covered properties benefit from the same hardship-based assistance. Policyholders benefit from monthly premium installments that make flood insurance easier to budget. Communities with flood exposure benefit if affordability support reduces policy lapses.

Who Bears the Burden and How

FEMA must design the assistance program, process applications, create hardship metrics, issue regulations and guidance, produce feasibility reports, and implement or explain monthly premium billing. NFIP administrators and Write Your Own insurers may need to change billing, application, verification, and discount systems. Federal taxpayers fund the annually appropriated assistance until fiscal-year amounts are exhausted. Applicants must document income, small-business status, nonprofit status, hardship, and covered-property eligibility.

Key Provisions

• Establishes a means-tested NFIP assistance program within one year.
• Caps eligible residential policyholder premiums at no more than 1 percent of area median income.
• Extends eligibility to qualifying small businesses with 100 or fewer employees and qualifying nonprofits under FEMA hardship metrics.
• Requires FEMA regulations, guidance, hardship metrics, and a congressional feasibility report.
• Requires monthly NFIP premium installments within 180 days or a congressional explanation for delay.