PRINTER'S NO. 237
No. 215 Session of 1997
INTRODUCED BY BAKER, MASLAND, BATTISTO, McCALL, CLARK, TIGUE,
BELARDI, M. N. WRIGHT, GORDNER, BOSCOLA, STABACK, HENNESSEY,
E. Z. TAYLOR, CAWLEY, REBER, ALLEN, D. W. SNYDER, ITKIN,
DeWEESE, BUNT, ZUG, SCHRODER, FICHTER, LEH, LAUGHLIN, GEORGE,
STEIL, FARGO, ADOLPH, CURRY, RAMOS, MILLER, PHILLIPS,
JOSEPHS, HERSHEY, TANGRETTI, MICHLOVIC, CIVERA, L. I. COHEN,
CAPPABIANCA, DiGIROLAMO, SURRA, LUCYK, HUTCHINSON, BELFANTI,
MICOZZIE AND GEIST, FEBRUARY 4, 1997
REFERRED TO COMMITTEE ON VETERANS AFFAIRS AND EMERGENCY
PREPAREDNESS, FEBRUARY 4, 1997
AN ACT
1 Amending Title 35 (Health and Safety) of the Pennsylvania
2 Consolidated Statutes, creating the State Disaster Assistance
3 Loan Program; providing for powers and duties of the
4 Pennsylvania Emergency Management Agency and the Pennsylvania
5 Housing Finance Agency; establishing the State Disaster
6 Assistance Loan Fund; providing for funding for the State
7 Disaster Assistance Loan Program; and making an
8 appropriation.
9 The General Assembly of the Commonwealth of Pennsylvania
10 hereby enacts as follows:
11 Section 1. Chapter 73 of Title 35 of the Pennsylvania
12 Consolidated Statutes is amended by adding a subchapter to read:
13 SUBCHAPTER C
14 DISASTER ASSISTANCE LOANS
15 Sec.
16 7321. Legislative findings and purpose.
17 7322. Definitions.
1 7323. State Disaster Assistance Loan Program.
2 7324. Request for loan authorization.
3 7325. Application for and issuance of loan.
4 7326. Funding.
5 § 7321. Legislative findings and purpose.
6 (a) Findings.--The General Assembly finds as follows:
7 (1) This Commonwealth, because of its topography,
8 development and economic base, is susceptible to a wide range
9 of disasters and emergencies, including fire, flood and wind
10 and technological accidents and emergencies, that threaten
11 public health and safety as well as the economic well-being
12 of the citizens of this Commonwealth.
13 (2) The violent forces of nature and unpredictable man-
14 made accidents that occur in this Commonwealth cause damage
15 to public and private property and create conditions that
16 force families from their homes. These disasters and
17 emergencies threaten public health, safety and the general
18 welfare of affected communities.
19 (3) Disasters which have impact on a large area and
20 population often qualify for various forms of aid from the
21 Federal Government to help repair and replace damaged
22 residences. More localized disasters create identical serious
23 hardship and loss for those families directly affected, but
24 Federal assistance is not made available to help with
25 recovery.
26 (4) As a result of extensive repair costs resulting from
27 disaster and emergency damages, homeowners without adequate
28 insurance coverage may be unable to repair their damaged
29 property.
30 (5) Failure to expeditiously repair disaster and
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1 emergency damages may result in a degradation of the quality
2 of the community and the creation of unsafe conditions.
3 (b) Purpose.--It is the purpose of this subchapter to create
4 a State program to provide limited assistance to homeowners
5 directly affected by disasters and emergencies. State assistance
6 will be limited to loans to homeowners to help repair damage to
7 primary residences. Loans will be made available by the State
8 when community conditions exceed a clearly established threshold
9 of loss and impact.
10 § 7322. Definitions.
11 The following words and phrases when used in this subchapter
12 shall have the meanings given to them in this section unless the
13 context clearly indicates otherwise:
14 "Fund." The State Disaster Assistance Loan Fund established
15 under this subchapter.
16 "Program." The State Disaster Assistance Loan Program
17 created under this subchapter.
18 § 7323. State Disaster Assistance Loan Program.
19 (a) Program created.--The State Disaster Assistance Loan
20 Program is hereby created to provide disaster assistance loans
21 to homeowners under the provisions of this subchapter.
22 (b) Responsibilities of the agency.--The agency is hereby
23 authorized to do the following:
24 (1) Develop the program with the Pennsylvania Housing
25 Finance Agency and other appropriate State and county
26 government representatives to provide loans to homeowners
27 directly affected by disasters and emergencies when the
28 impact upon the community exceeds an established threshold of
29 loss and impact.
30 (2) Authorize the issuance of State disaster assistance
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1 loans to homeowners after review and approval of the county's
2 written request, submission of a detailed damage survey
3 report, compliance with necessary public funding requirements
4 and certification that no other public funded program exists
5 to help affected homeowners.
6 (3) Develop and conduct training programs for State and
7 county officials and staff to implement the State Disaster
8 Assistance Loan Program. Training shall include program
9 administration, damage assessment documentation and reporting
10 and mitigation identification and implementation.
11 § 7324. Request for loan authorization.
12 (a) County requests.--County emergency management
13 coordinators, in coordination with disaster-affected municipal
14 elected officials and local emergency management coordinators,
15 shall submit to the agency a request to make State disaster
16 assistance loans available to disaster-affected homeowners in
17 the county. As required by section 7504(b) (relating to
18 coordination, assistance and mutual aid), all requests shall be
19 based on a finding that the disaster is of such magnitude and
20 severity that State disaster assistance is necessary to
21 alleviate the hardships caused to the affected homeowners and
22 that no other government-funded programs exist or existing
23 programs have been exhausted.
24 (b) Program eligibility threshold.--In order for the agency
25 to authorize State disaster assistance loans, the county must
26 submit a detailed written damage survey report which identifies
27 by name and address each residential homeowner who has suffered
28 an uninsured loss in excess of 40% of the predisaster fair
29 market value of the home. In order for the program to be
30 implemented, there must be within that county at least ten
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1 primary residences of either a single-family residential,
2 condominium, apartment or mobile home nature which have suffered
3 damage or loss directly caused by the identified disaster or
4 emergency. Camps, cottages or other types of secondary
5 residences are not eligible for disaster loan assistance.
6 Applicants must show proof that banks and other financial
7 institutions will not grant a loan for this purpose or that the
8 loan repayment amount is beyond the capability of the homeowner.
9 In its written request, the county shall also furnish
10 information requested by the agency concerning the nature of the
11 disaster or emergency that impacted the county. The county must
12 also certify in its report that current county and affected
13 political subdivision emergency management plans are current and
14 have been activated in response to the disaster or emergency.
15 The agency shall review the effectiveness of the plans and
16 response and may require changes as it deems necessary in plans
17 and procedures. The changes shall be made by local and county
18 governments before any loans may be authorized.
19 § 7325. Application for and issuance of loan.
20 (a) Review of county requests for assistance.--The agency
21 shall review and approve all county requests for loan
22 assistance. The agency shall then notify the Pennsylvania
23 Housing Finance Agency of all approved county requests. The
24 Pennsylvania Housing Finance Agency shall then implement the
25 loan application, review, approval and award process for the
26 individual residential homeowners identified in the county's
27 damage survey report.
28 (b) Loan application and award.--All loans issued under the
29 program are supplemental to a homeowner's residential insurance
30 coverage. This program may be authorized when the magnitude and
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1 severity of the disaster or emergency meets or exceeds program
2 eligibility standards as set forth in section 7324(b) (relating
3 to request for loan authorization). All requirements of the loan
4 application and award process shall be developed by the agency
5 and the Pennsylvania Housing Finance Agency. The Pennsylvania
6 Housing Finance Agency shall develop regulations to implement
7 the loan requirements. All applications for loans must be
8 received by the Pennsylvania Housing Finance Agency within 60
9 days after the agency has approved the county damage survey
10 report and request for assistance.
11 (c) Homeowner eligibility.--A homeowner residing within a
12 county or counties designated by the agency as a State disaster
13 emergency area who suffered disaster-related damage to a primary
14 residence in excess of the amount described in section 7324 may
15 apply for a State disaster assistance loan.
16 (d) Interest.--The rate of interest on State disaster
17 assistance loans shall be set by the Pennsylvania Housing
18 Finance Agency in its regulations. Loans shall be secured by
19 mortgages on the real estate and shall be repaid in accordance
20 with promissory notes which establish monthly loan principal and
21 interest payments.
22 (e) Insurance requirement.--As a condition of eligibility
23 for a State disaster assistance loan, the loan recipient shall
24 agree to purchase and maintain insurance coverage in an amount
25 equal to the value of the rebuilt or replaced primary residence
26 for which a loan is awarded. The insurance shall include full
27 protection against all natural hazards, including fire, wind
28 and, where appropriate, flood damage. All primary residences
29 located within a designated 100-year flood plain must include
30 flood insurance. During the term of the loan, each loan
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1 recipient must provide written verification of appropriate and
2 adequate insurance protection in the form of either premium
3 statements, policy renewal notices or copies of the actual
4 insurance policy to the Pennsylvania Housing Finance Agency. The
5 insurance policy must list the Pennsylvania Housing Finance
6 Agency as the loss payee of the policy. A homeowner's failure to
7 maintain appropriate insurance protection shall result in the
8 loan being declared in default.
9 (f) Limitations.--The following limitations shall apply to
10 the program:
11 (1) A loan shall not be made to a homeowner who is
12 eligible to receive assistance from the Federal Government
13 under any Federal disaster assistance and recovery program. A
14 homeowner who has received Federal aid in the maximum amount
15 allowable under Federal disaster relief law and continues to
16 have significant disaster-related damage to a primary
17 residence making the home uninhabitable may be eligible to
18 apply for a State disaster assistance loan.
19 (2) Loans shall be limited to homeowner-occupied primary
20 residences that are located within a county that the agency
21 has designated as a disaster emergency area.
22 (3) Loans are limited to providing for essential repairs
23 to the primary residence which are needed to make the
24 residence safe, sanitary and habitable for occupancy based on
25 applicable State and local building or occupancy codes. Loans
26 shall not be authorized for improvements to the value of the
27 residence or for other purposes not authorized by this
28 section.
29 (4) Repairing or replacing loss or damage to
30 landscaping, scrubs, trees, out-buildings or any other
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1 nonresidential structures which are not physically attached
2 to the primary residence are not eligible costs for a State
3 disaster assistance loan.
4 (5) Loans may be provided for disaster mitigation on the
5 property if approved by the agency.
6 (6) A homeowner may only apply for one disaster
7 assistance loan at a time. While a homeowner's disaster
8 assistance loan is in effect, the same homeowner shall be
9 ineligible for another loan under the program. If the
10 homeowner's primary residence is damaged in a subsequent
11 disaster while the disaster assistance loan is in effect, the
12 required insurance coverage shall be considered adequate for
13 repairs to the residence.
14 (7) The maximum amount of a loan is $50,000. The minimum
15 amount of any loan is $1,000.
16 § 7326. Funding.
17 (a) Appropriation.--The sum of $1,000,000 is appropriated to
18 the Pennsylvania Housing Finance Agency.
19 (b) State Disaster Assistance Loan Fund.--The sum
20 appropriated shall be deposited in a State Disaster Assistance
21 Loan Fund which is hereby established as a restricted receipts
22 account in the State Treasury. Moneys in the fund shall be used
23 solely for the purpose of implementing this subchapter. The
24 first executive budget submission following the effective date
25 of this subchapter shall contain the appropriation provided for
26 in subsection (a). Appropriations to the fund shall not lapse.
27 All loan payments of principal and interest made to the
28 Pennsylvania Housing Finance Agency shall be deposited in the
29 fund. Any amount in the fund in excess of $3,000,000 which
30 remains unexpended or uncommitted after July 1 of each year,
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1 beginning with the first fiscal year after the enactment of this
2 subchapter, shall be returned to the General Fund. Sufficient
3 appropriations shall be made annually in order to maintain a
4 minimum balance of at least $1,000,000. Should annual program
5 activity exceed the funds available, the General Assembly may
6 supplement the fund to restore it to the full annual
7 appropriation.
8 (c) Administrative expenses.--The Pennsylvania Housing
9 Finance Agency shall annually provide to the Pennsylvania
10 Emergency Management Agency 10% of the total amount in the fund
11 in order that the agency may provide for program administration,
12 State and local damage assessment training and materials, and
13 operational, mitigation, preparedness, response and recovery
14 costs.
15 (d) Diversion of moneys in fund prohibited.--Moneys in the
16 fund shall not be diverted to fund other Commonwealth operations
17 or programs or be transferred to other funds, and shall be used
18 exclusively for the purposes provided for in this subchapter.
19 Section 2. This act shall take effect immediately.
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