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e , . e I, i ~ ! . \ e THE NFIRA SEC. 1366. (a) AUTHOR1TY.- The Director shall carry out a program to provide financial assistance to States and communities, using amounts made available from the National Flood Mitigation Fund under section 1367, for planning and carrying out activities designed to reduce the risk of flood damage to structures covered under contracts for flood insurance under this title. Such financial assistance shall be made available to States and communities in the form of grants under subsection (b) for planning assistance and in the form of grants under this section for carrying out mitigation activities. 42 V.S.c. 4104c THE NFIRA SEC. 1367. (b) CREDlTs.-Tbe National Flood Mitigation Fund shall be credited with- (1) amounts from the National Flood Insurance Fund. . .; (2) any penalties collected under section 102(f) of the Flood Disaster Protection Act of 1973; and (3) any amounts recaptured under section 1366(i). 42 V.S.C. 4104d " PAGE 1-3 National Flood Insurance Reform Act of 1994 The legal basis for FMA is the National Flood Insurance Reform Act of 1994 (NFIRA), Sections 1366 and 1367 (42 U.S.C. 4101). Section 1366 assigns the FEMA Director the authority and responsibility for carrying out the program. Section 1367 establishes the National Flood Mitigation Fund to fund FMA grants. FMA will replace the former 1362 Real Property Acquisition and Upton-Jones erosion protection programs. FMA is broader in purpose and more flexible than these programs. Appendix A contains Sections 1366 and 1367 of the NFIRA for your reference. National Flood Mitigation Fund The NFIP is a program which makes federally backed flood insurance available in those States and communities that agree to adopt and enforce floodplain management measures. The funding source for the National Flood Insurance Program is the National Flood Insurance Fund. Moneys for the National Flood Insurance Fund come from insurance premiums paid by policyholders in the NFlP. Section 1367 of the NFlRA specifies that the primary funding source for the National Flood Mitigation Fund is the National Flood Insurance Fund. This approach reflects a long-term strategy in which insurance funds are invested in activities that will reduce future claims against the National Flood Insurance Fund. FMA's success in reducing future flood insurance claims depends on the ability of States and communities to develop and maintain long-term Flood Mitigation Plans. States will award FMA gran's to fund cost-effective projects that reduce flood damage, with priority given to repetitively or substantially damaged structures. FMA's strategy is intended to keep future flood insurance premiums down by reducing claims against the National Flood Insurance Fund. FEMA 299/AUGUST 1997 FLOOD MITIGATION ASSISTANCE (FMA) GUIDANCE