Sec. 2. Risk transfer
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Title III of the Robert T. Stafford Disaster Relief and Emergency Assistance Act ( 42 U.S.C. 5141 ) is amended by adding at the end the following: Not later than 90 days after the date of enactment of this section, the Administrator of the Federal Emergency Management Agency shall solicit proposals and may secure contracts from private entities providing insurance, reinsurance, or capital market investments to transfer a portion of the risk of assistance provided under any or all of sections 403, 404, 406, 407, 408, and 428, and of title V.
The Administrator shall deposit any funds collected as the result of transfer of risk arrangements into the Disaster Relief Fund and such funds are available for any purpose for which such Fund may be used. Not later than 18 months after the date of enactment of this section, the Administrator shall submit to Congress a report that— provides a description of the proposals described in subsection
(a)that the Administrator received; assesses the proposals described in paragraph
(1)with respect to the capacity of private reinsurance, capital, and financial markets to assist communities in managing the full range of financial risks associated with major disasters; assesses whether the rates and terms of the proposals described in paragraph
(1)are— reasonable and appropriate; and in an amount sufficient to ensure the Disaster Relief Fund has the resources necessary to respond to major disasters; identifies the proposals, if any, that contain rates and terms that satisfy the requirements of subparagraphs
(A)and
(B)of paragraph (3); and describes the extent to which the proposals described in paragraph
(4)would minimize the likelihood that the Disaster Relief Fund would require emergency supplemental appropriations. The Administrator may annually transfer a portion of the risk of the payments that may be made pursuant to this section to private insurance, reinsurance, or the capital markets, or any combination thereof, pursuant to the rates and terms of any proposals described in subsection (c)(4), if the Administrator determines that transferring such a portion is in the public interest. Any transfer of risk pursuant to paragraph
(1)may be entered into without regard to the provisions of chapter 1 of title 48, Code of Federal Regulations. The authority described in paragraph
(1)expires 5 years after the date on which the Administrator first transfers a portion of risk pursuant to such paragraph. Nothing in this subsection may be construed to prevent or prohibit the Administrator from entering into contracts having a duration longer than 1 year. Not later than 6 months after the date on which the Administrator identifies a proposal that contains rates and terms that satisfy the requirements of subparagraphs
(A)and
(B)of subsection (c)(3), the Administrator shall submit to Congress a report detailing— whether the Administrator adopted the proposal; and the reasons the Administrator adopted or did not adopt such proposal. .
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