Sec. 305. Agreed Value Flood Protection Program Reserve Fund
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In carrying out the Program, the Administrator shall establish in the Treasury of the United States an Agreed Value Flood Protection Program Reserve Fund, which shall be— separate from any other accounts or funds available to the Administrator; and available for meeting the expected future obligations of the Program, including— the payment of claims during catastrophic loss years; and the repayment of amounts outstanding under any note or other obligation issued by the Administrator under section 1309(a) of the National Flood Insurance Act of 1968 ( 42 U.S.C. 4016(a) ).
Subject to the phase-in requirements under subsection (d), the Reserve Fund shall maintain a balance that, together with any risk financing covering the Program, is an amount that is equal to— 1.5 percent of the sum of the total potential loss exposure of all outstanding agreed value flood protection policies in force during the prior fiscal year; or a higher percentage of the sum described in paragraph
(1)that the Administrator determines to be appropriate, taking into consideration any circumstance that may raise a significant risk of substantial future losses to the Reserve Fund. The Administrator may establish, increase, or decrease the amount of aggregate annual policy charges to be collected for any fiscal year that are necessary in order to— maintain the amount required under subsection (b); and if the balance of the Reserve Fund is an amount that is less than the amount required under subsection (b), obtain the amount required under subsection (b). In exercising the authority under paragraph (1), the Administrator shall consider— the expected operating expenses of the Reserve Fund; the covered loss expenditures under the Program; any investment income generated under the Program; and any other factor that the Administrator determines appropriate. Notwithstanding any other provision of law or any agreement entered into by the Administrator, the Administrator shall ensure that all amounts attributable to the establishment or increase of annual policy charges under paragraph
(1)are transferred to the Administrator for deposit into the Reserve Fund to be available for meeting the expected future obligations of the Program, as described in subsection (a)(2). The phase-in requirements under this subsection are as follows: Beginning in fiscal year 2018, and in each successive fiscal year thereafter until the amount required under subsection
(b)is obtained, the Administrator shall deposit in the Reserve Fund an amount that is not less than 10 percent of the amount required under subsection (b). Except as provided in paragraph (3), beginning on the date on which the amount required under subsection
(b)is obtained, the Administrator shall not be required to set aside any amounts for the Reserve Fund. If, at any time during any fiscal year after the amount required under subsection
(b)is obtained, the amount in the Reserve Fund is less than the amount required under subsection (b), the Administrator shall deposit in the Reserve Fund during that fiscal year an amount that is not less than the lesser of— the difference between the amount required under subsection
(b)and the amount in the Reserve Fund; or 10 percent of the amount required under subsection (b). If, in any fiscal year, the Administrator determines that the amount required under subsection
(b)cannot be obtained, the Administrator shall submit to Congress a report that— describes and details the specific concerns of the Administrator regarding the consequences of that amount not being obtained; demonstrates how the consequences described in paragraph
(1)would harm the long-term financial soundness of the Program; and indicates the maximum attainable amount for that fiscal year. The Secretary of the Treasury shall invest such amounts of the Reserve Fund as the Secretary determines advisable in obligations issued or guaranteed by the United States.
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Sec. 305
Agreed Value Flood Protection Program Reserve Fund
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