article: SECTION 1. SHORT TITLE. This Act may be cited as the ``Local Innovation and Coastal Protection Act of 1993''. SEC. 2. PROGRAM AUTHORITY. (a) In General.--Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.) is amended by adding at the end the following new section: ``SEC. 1366. EROSION MITIGATION DEMONSTRATION PROGRAM. ``(a) In General.--The Director shall make grants, with amounts made available from the Coastal Erosion Control Fund established under section 1367, to demonstrate the feasibility of innovative mitigation activities designed to minimize coastal erosion, preserve shorelines, and avoid environmental degradation. ``(b) Eligible Recipients.--The Director may make grants under this section to-- ``(1) any State; and ``(2) any community participating in the national flood insurance program under this title that-- ``(A) has suffered recurring flood damages and claims, as determined by the Director; and ``(B) is in full compliance with the requirements under the national flood insurance program. ``(c) Eligible Activities.-- ``(1) In general.--A grant under this section may be used to develop and test innovative techniques to minimize coastal erosion and preserve shorelines. ``(2) Priority.--In making grants under this section, the Director shall give a priority to eligible recipients that conduct projects to demonstrate the feasibility of techniques that-- ``(A) have application to more than 1 location; ``(B) substantially broaden the applicability of proven erosion control techniques; or ``(C) avoid permanent structural alterations and rely instead on natural designs, including the use of vegetation, or temporary structures, to accomplish their goal. ``(d) Applications.--The Director shall make grants under this section on the basis of a nationwide competition, in accordance with such application forms and procedures as the Director may establish. ``(e) Maximum Amount.--The total amount of any grant under this section may not exceed $500,000 for any project assisted under this section. ``(f) Program Requirements.-- ``(1) Matching requirements.-- ``(A) In general.--Except as provided in subparagraph (C), a grant under this section may not exceed 3 times the amount that the recipient certifies, as the Director shall require, that the recipient will contribute from non-Federal funds to carry out activities assisted with amounts provided under this section. ``(B) Non-federal funds.--For purposes of this subsection, the term `non-Federal funds' includes-- ``(i) State or local agency funds, ``(ii) any salary paid to staff to carry out the activities of the recipient, ``(iii) the value of the time and services contributed by volunteers to carry out such activities (at a rate determined by the Director), and ``(iv) the value of any donated material or building and the value of any lease on a building. ``(C) No match required for evaluation.--No non- Federal contribution is required for the conduct of evaluations under paragraph (2). ``(2) Report.--Not later than 5 years after the receipt of a grant under this section, the recipient of the grant shall transmit to the Director a report that-- ``(A) evaluates the long-term effectiveness of the techniques that were developed under this section; and ``(B) assesses any impact that such techniques have had on adjacent coastal areas. ``(g) Report to Congress.--The Director shall transmit to the Congress an annual report that-- ``(1) summarizes the erosion mitigation techniques developed pursuant to this section; ``(2) describes the status of the Coastal Erosion Control Fund established under section 1367; and ``(3) recommends any legislative or administrative action necessary to further the purpose of this section. ``(h) Authorization.--There are authorized to be appropriated to carry out this section, from the Coastal Erosion Control Fund under section 1367, $12,500,000 for each of the fiscal years 1994 through 1997.''. SEC. 3. ESTABLISHMENT OF COASTAL EROSION CONTROL FUND. Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.), as amended by section 2, is further amended by adding at the end the following new section: ``SEC. 1367. ESTABLISHMENT OF COASTAL EROSION CONTROL FUND. ``(a) In General.--The Director shall establish in the Treasury of the United States a fund to be known as the Coastal Erosion Control Fund (hereafter in this section referred to as the `Fund'), which shall be available, to the extent provided in appropriation Acts, for grants under section 1366. ``(b) Credits.--The Fund shall be credited with any premium surcharges assessed under section 1308(e).''. SEC. 4. INSURANCE PREMIUM MITIGATION SURCHARGE. (a) In General.--Section 1308 of the National Flood Insurance Act of 1968 (42 U.S.C. 4015) is amended by adding at the end the following new subsections: ``(e) Notwithstanding any other provision of this title, the Director shall assess, with respect to each contract for flood insurance coverage under this title, an annual mitigation surcharge of $5. The surcharges shall be paid into the Coastal Erosion Control Fund under section 1367, and shall not be subject to any agents' commissions, company expenses allowances, or State or local premium taxes. ``(f) The Director shall not assess any surcharge under subsection (e) if the balance of the Fund exceeds $15,000,000. ``(g) The Director shall transmit to those who paid a surcharge under subsection (e)-- ``(1) an annual report describing the expenditures of the Fund during the preceding fiscal year; and ``(2) any unobligated funds that remain in the Fund at the end of fiscal year 1997.''. (b) Applicability.--The amendment made by subsection (a) shall apply to any contract for flood insurance under the National Flood Insurance Act of 1968 issued or renewed after the date of enactment of this Act. SEC. 5. INSURANCE RATE INCENTIVES FOR EROSION MITIGATION EFFORTS. Chapter III of the National Flood Insurance Act of 1968 (42 U.S.C. 4101 et seq.), as amended by sections 2 and 3, is further amended by adding at the end the following new section: ``SEC. 1368. INSURANCE RATE INCENTIVES FOR EROSION MITIGATION EFFORTS. ``(a) Preferred Erosion Mitigation Measures.--The Director shall evaluate the effectiveness of the erosion mitigation measures funded under section 1366 and shall publish a list of the most effective of such measures in the Federal Register. ``(b) Rate Incentives for Communities.--The Director shall provide incentives in the form of adjustments in the premium rates for flood insurance coverage in areas that the Director determines have implemented erosion mitigation measures contained in the list published pursuant to subsection (a).''.
summary: Local Innovation and Coastal Protection Act of 1993 - Amends the National Flood Insurance Act of 1968 to require the Director of the Federal Emergency Management Agency to make grants ($500,000 maximum with matching fund requirements) from the Coastal Erosion Control Fund (established by this Act) to States and qualifying communities for an erosion mitigation demonstration program. Gives grant priority to projects that: (1) have multiple location applicability; (2) broaden existing erosion control techniques; or (3) rely on natural designs rather than structural alterations. Authorizes appropriations. Establishes in the Treasury the Coastal Erosion Control Fund. Requires the Director to: (1) assess an annual five-dollar flood insurance premium mitigation surcharge to be paid into such Fund, unless the Fund's balance exceeds $15 million; (2) evaluate and publish a list of the most effective erosion mitigation measures; and (3) provide flood insurance rate incentives for erosion mitigation efforts.