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                                                      PRINTER'S NO. 1445

THE GENERAL ASSEMBLY OF PENNSYLVANIA


SENATE BILL

No. 1035 Session of 2004


        INTRODUCED BY COSTA, LOGAN, KUKOVICH, PIPPY AND FERLO,
           MARCH 22, 2004

        REFERRED TO ENVIRONMENTAL RESOURCES AND ENERGY, MARCH 22, 2004

                                     AN ACT

     1  Establishing the Landslide Insurance and Assistance Program
     2     within the Pennsylvania Emergency Management Agency;
     3     providing for related powers and duties of the Pennsylvania
     4     Emergency Management Agency; establishing and providing for
     5     the powers and duties of the Landslide Insurance and
     6     Assistance Board; establishing the Landslide Insurance Fund
     7     and the Landslide Assistance Fund; and making appropriations.

     8                         TABLE OF CONTENTS
     9  Chapter 1.  Preliminary Provisions
    10  Section 101.  Short title.
    11  Section 102.  Declaration of policy.
    12  Section 103.  Definitions.
    13  Chapter 3.  Program Generally
    14  Section 301.  Program goals.
    15  Section 302.  Board.
    16  Section 303.  Appeals.
    17  Section 304.  Program generally.
    18  Section 305.  Program authority.
    19  Section 306.  Land use controls and rate structure.
    20  Chapter 5.  Landslide Insurance Fund


     1  Section 501.  Landslide Insurance Fund.
     2  Section 502.  Schedule of premiums.
     3  Section 503.  Surplus.
     4  Section 504.  Insurance program.
     5  Section 505.  Application for increase in insurance.
     6  Section 506.  Automatic inflation protection increase.
     7  Section 507.  Audit by Auditor General.
     8  Section 508.  Claims against insurance fund.
     9  Section 509.  Defenses against claims and procedure.
    10  Section 510.  Subrogation to rights of claimants.
    11  section 511.  Insurance companies may cover risk.
    12  Section 512.  Escrow of premium payments.
    13  Section 513.  Properties in violation of State or local law.
    14  Chapter 7.  Mitigation Assistance
    15  Section 701.  Mitigation assistance.
    16  Section 702.  Landslide Assistance Fund.
    17  Section 703.  Construction permits.
    18  Chapter 9.  Program Administration and Funding
    19  Section 901.  Regulations.
    20  Section 902.  Agency report.
    21  Section 903.  Program funding.
    22  Section 904.  Reimbursement.
    23  Section 905.  Appropriations.
    24  Section 906.  Cost of administration.
    25  Section 907.  Commissions.
    26  Chapter 21.  Miscellaneous Provisions
    27  Section  2101.  Effective date.
    28     The General Assembly of the Commonwealth of Pennsylvania
    29  hereby enacts as follows:
    30                             CHAPTER 1
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     1                       PRELIMINARY PROVISIONS
     2  Section 101.  Short title.
     3     This act shall be known and may be cited as the Landslide
     4  Insurance and Assistance Program Act.
     5  Section 102.  Declaration of policy.
     6     The General Assembly finds and declares as follows:
     7         (1)  Geologists have studied with increasing concern the
     8     underground movement of the geological formations in this
     9     Commonwealth and its impeding effects on the vertical and
    10     horizontal natural and manmade surfaces.
    11         (2)  Landslides and slope movement have historically been
    12     the norm throughout most parts of this Commonwealth.
    13         (3)  Landslides and slope movements occur without regard
    14     for municipal boundaries, ordinances, planning codes,
    15     politics and economies, making it difficult for local
    16     officials to deal effectively with the development and
    17     implementation of methods and standards to control the
    18     devastation these natural forces can cause.
    19         (4)  Landslides and slope movement have caused an
    20     enormous amount of damage to homes and roadways in this
    21     Commonwealth, particularly the southwestern region of the
    22     State.
    23         (5)  Landslides and slope movement will continue to
    24     plague southwestern Pennsylvania.
    25         (6)  Landslides affect every state in the nation causing
    26     an estimated $1 billion to $3 billion in damages a year.
    27         (7)  Landslide damage caused by flooding is not covered
    28     by the National Flood Insurance Program.
    29         (8)  While landslide damage caused by mining practices is
    30     covered by the Coal and Clay Mine Subsidence Insurance Fund
    20040S1035B1445                  - 3 -     

     1     and mudslide damage is covered by the National Flood
     2     Insurance Program, other types of landslide damage is usually
     3     not covered by insurance.
     4         (9)  Problems associated with landslide damage are
     5     becoming more widespread.
     6         (10)  It would be to the advantage of residents of the
     7     landslide-prone areas of this Commonwealth to form a common
     8     bond to combat distress resulting from landslides.
     9  Section 103.  Definitions.
    10     The following words and phrases when used in this act shall
    11  have the meanings given to them in this section unless the
    12  context clearly indicates otherwise:
    13     "Agency."  The Pennsylvania Emergency Management Agency.
    14     "Assistance fund."  The Landslide Assistance Fund.
    15     "Board."  The Landslide Insurance and Assistance Board.
    16     "Community."  Either of the following:
    17         (1)  A political subdivision that has zoning and building
    18     code jurisdiction over an area having landslide hazards.
    19         (2)  A political subdivision that is designated to
    20     develop and administer a mitigation plan.
    21     "Extremely hazardous area."  An area where all of the
    22  following factors that contribute to landslides occur in the
    23  same location:
    24         (1)  Steep slopes.
    25         (2)  Soils prone to landslides.
    26         (3)  Landslide features.
    27     "Further review area."  An area for which additional site-
    28  specific review is needed based on a geological map or model
    29  identifying the area as including a site prone to experience a
    30  landslide.
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     1     "GIS."  Geographic Information Systems.
     2     "Hazardous area."  An area where one of the following factors
     3  that contribute to landslides occurs:
     4         (1)  Steep slopes.
     5         (2)  Soils prone to landslides.
     6         (3)  Landslide features.
     7     "Insurance fund."  The Landslide Insurance Fund.
     8     "Landslide."  Any detached mass of soil, rock, earth or
     9  debris that moves down a slope and is of sufficient size to
    10  cause damage. The term includes sinkholes.
    11     "Landslide features."  Includes, but is not limited to,
    12  rockfall areas, creep, red beds and historic landslides.
    13     "Mitigation."  An activity relative to landslides that
    14  prevents an emergency from occurring, reduces the likelihood of
    15  an emergency occurring or lessens the damaging effects of
    16  unavoidable emergency situations.
    17     "Mitigation plan."  A plan designed by a community that when
    18  implemented provides mitigation.
    19     "Program."  The Landslide Insurance and Assistance Program.
    20                             CHAPTER 3
    21                         PROGRAM GENERALLY
    22  Section 301.  Program goals.
    23     The goals of the program are as follows:
    24         (1)  To provide actuarially sound insurance coverage.
    25         (2)  To make program policies universally available and
    26     competitively priced.
    27         (3)  To make use of the most effective scientific and
    28     technological advances available, including technology such
    29     as GIS.
    30         (4)  To process claims promptly, fairly and consistently.
    20040S1035B1445                  - 5 -     

     1         (5)  To provide tools and incentives for landslide loss
     2     reduction, including the Landslide Assistance Fund.
     3         (6)  To collaborate with other organizations that operate
     4     in the public interest to assist in achieving program goals.
     5  Section 302.  Board.
     6     (a)  Board established.--The Landslide Insurance and
     7  Assistance Board is hereby established within the Pennsylvania
     8  Emergency Management Agency.
     9     (b)  Members.--The board shall consist of the following
    10  members:
    11         (1)  The Secretary of Banking or a designee.
    12         (2)  The Secretary of Community and Economic Development
    13     or a designee.
    14         (3)  The Secretary of Conservation and Natural Resources
    15     or a designee.
    16         (4)  The Secretary of Environmental Protection or a
    17     designee.
    18         (5)  The Insurance Commissioner or a designee.
    19         (6)  The Secretary of Public Welfare or a designee.
    20         (7)  The Secretary of State or a designee.
    21         (8)  The Secretary of Transportation or a designee.
    22         (9)  The State Treasurer or a designee.
    23         (10)  The Director of the Pennsylvania Emergency
    24     Management Agency or a designee.
    25         (11)  The Executive Director of the Pennsylvania Housing
    26     Finance Agency or a designee.
    27     (c)  Chairperson.--The Director of the Pennsylvania Emergency
    28  Management Agency or the designee shall serve as the chairperson
    29  of the board.
    30     (d)  General counsel.--The Attorney General shall, ex
    20040S1035B1445                  - 6 -     

     1  officio, be the general counsel of the board and shall appoint
     2  an attorney or attorneys as may be deemed necessary to aid the
     3  board in its functioning.
     4     (e)  Employees.--All employees of the board shall be employed
     5  by and located in the agency and shall be subject to the
     6  administrative jurisdiction and authority of the agency.
     7  Section 303.  Appeals.
     8     Any party aggrieved by an action of the board shall have the
     9  right to appeal in accordance with 2 Pa.C.S. (relating to
    10  administrative law and procedure).
    11  Section 304.  Program generally.
    12     (a)  Establishment.--The Landslide Insurance and Assistance
    13  Program is hereby established within the agency.
    14     (b)  Program components.--The program shall consist of the
    15  following components:
    16         (1)  A grant program.
    17         (2)  A revolving loan program.
    18         (3)  An insurance program.
    19     (c)  Purposes.--The grant program and the revolving loan
    20  program are established for the primary purposes of mitigation
    21  and repairing minor structural damage. The board shall employ
    22  the grant program and the revolving loan program as tools to aid
    23  in the success of the insurance fund.
    24  Section 305.  Program authority.
    25     (a)  Intergovernmental cooperation.--The program shall:
    26         (1)  Work closely with Federal, State and local agencies
    27     and any other government agencies, including those of other
    28     states, to accomplish program goals.
    29         (2)  Create and implement a Statewide landslide
    30     mitigation plan that would encourage and support local
    20040S1035B1445                  - 7 -     

     1     mitigation efforts.
     2         (3)  Investigate sites to define hazards.
     3         (4)  Recommend legislation, regulations, ordinances and
     4     zoning to mitigate slope instability contributed by
     5     excavation and drainage.
     6         (5)  Work with local governments to evaluate risk
     7     associated with certain homesite development.
     8         (6)  Share the most up-to-date geological surveys, in the
     9     form of maps, GIS data or other useful form, and related
    10     information, free of charge to government agencies and
    11     appropriate representatives of communities, and at a
    12     reasonable cost to all other persons. Receipts under this
    13     paragraph shall be deposited in the assistance fund.
    14         (7)  Inform the Department of Transportation of the
    15     highways at greatest risk from landslides.
    16         (8)  Notify local governments in areas with the greatest
    17     risk from landslides.
    18         (9)  Have the authority to consult, receive information
    19     and enter into any agreements or other arrangements in order
    20     to identify and publish information with respect to all
    21     landslide-prone areas, establish or update landslide-risk
    22     zone data and make estimates with respect to the rates of
    23     probable landslide-caused loss for the various landslide risk
    24     zones for each of these areas.
    25         (10)  Publish any change to landslide insurance map
    26     panels.
    27         (11)  Ensure that it is consistent in landslide control,
    28     landslide forecasting and landslide damage prevention.
    29     (b)  Studies and investigations.--
    30         (1)  The program is authorized to carry out necessary
    20040S1035B1445                  - 8 -     

     1     studies and investigations, utilizing to the maximum extent
     2     practicable the existing facilities and services of other
     3     Commonwealth departments or agencies, Federal and local
     4     governmental agencies and any other organizations, with
     5     respect to the adequacy of State and local measures in
     6     landslide-prone areas as to:
     7             (i)  Land management and use.
     8             (ii)  Landslide control.
     9             (iii)  Zoning.
    10             (iv)  Landslide damage prevention.
    11         (2)  The program may enter into any contracts, agreements
    12     or other appropriate arrangements to carry out its authority
    13     under this section. The studies and investigations shall
    14     include, but not be limited to, the following:
    15             (i)  Laws.
    16             (ii)  Regulations.
    17             (iii)  Ordinances.
    18             (iv)  Zoning.
    19             (v)  Building codes.
    20             (vi)  Building permits.
    21             (vii)  Subdivision or other building restrictions.
    22     (c)  State and local measures.--On the basis of studies and
    23  investigations under subsection (b) and other information as the
    24  agency deems necessary, the program shall develop comprehensive
    25  criteria designed to encourage, where necessary, the adoption of
    26  adequate State and local measures which, to the maximum extent
    27  feasible, will:
    28         (1)  Constrict the development of land which is exposed
    29     to landslide damage where appropriate.
    30         (2)  Guide the development of proposed construction away
    20040S1035B1445                  - 9 -     

     1     from locations which are threatened by landslide hazards.
     2         (3)  Assist in reducing damage caused by landslides.
     3         (4)  Otherwise improve the long-range land management and
     4     use of landslide-prone areas.
     5     (d)  Technical assistance.--The program shall work closely
     6  with and provide any necessary technical assistance to State and
     7  local governmental agencies to encourage the application of the
     8  criteria and the adoption and enforcement of the measures under
     9  this section.
    10  Section 306.  Land use controls and rate structure.
    11     Local governments may initiate land-use controls for the
    12  benefit of their residents. The following shall apply:
    13         (1)  No new landslide insurance coverage shall be
    14     provided to new construction without pre-approval by an
    15     appropriate local public body, which shall have the option of
    16     adopting adequate land-use and control measures with
    17     effective enforcement provisions.
    18         (2)  A community rating system shall be employed by the
    19     board as an incentive for community landslide management.
    20         (3)  Rate structures shall provide incentives for
    21     measures that reduce the risk of landslide damage and
    22     evaluate the measures. The program shall provide incentives
    23     in the form of credits on premium rates for landslide
    24     insurance coverage in communities that the agency determines
    25     have adopted and enforced measures that reduce the risk of
    26     landslide damage.
    27         (4)  The credits on premium rates for flood insurance
    28     coverage shall be based on the estimated reduction in flood
    29     and erosion damage risks resulting from the measures adopted
    30     by the community under the program. If a community has
    20040S1035B1445                 - 10 -     

     1     received mitigation or other assistance under the program,
     2     the credits shall be phased in in a manner determined by the
     3     agency to recover the amount of assistance provided for the
     4     community.
     5                             CHAPTER 5
     6                      LANDSLIDE INSURANCE FUND
     7  Section 501.  Landslide Insurance Fund.
     8     (a)  Establishment.--The Landslide Insurance Fund is
     9  established as a separate fund in the State Treasury. The
    10  insurance fund shall be administered by the board for the
    11  purpose of insuring subscribers against the damages to their
    12  structures resulting from landslides if the damage is not
    13  covered by other insurance programs or coverage.
    14     (b)  Administration.--The insurance fund shall be
    15  administered by the board without liability on the part of the
    16  Commonwealth beyond the amount of the fund except as provided
    17  under this act and shall be applied to the payment of damage as
    18  described under subsection (a).
    19     (c)  State Treasurer as custodian of insurance fund.--The
    20  State Treasurer shall be the custodian of the insurance fund,
    21  and all disbursements from the insurance fund shall be paid at
    22  the request of the board. For making payments without audit, the
    23  State Treasurer shall not be under any liability whatsoever. The
    24  State Treasurer may deposit any portion of the insurance fund
    25  not needed for immediate use as other State funds are lawfully
    26  deposited. The interest shall be placed to the credit of the
    27  insurance fund.
    28  Section 502.  Schedule of premiums.
    29     At any time during each year the board shall prepare and
    30  publish a schedule of premiums or rates of insurance for
    20040S1035B1445                 - 11 -     

     1  subscribers. This schedule shall be printed and distributed free
     2  of charge to any person upon application. Any subscriber may at
     3  the subscriber's option pay to the insurance fund the amount of
     4  premium appropriate, and upon payment of the premium shall be
     5  insured for the year for which the premium is paid. The
     6  insurance shall cover all payments becoming due for which the
     7  premium is paid. The premium shall be adequate to enable payment
     8  of all sums which may become due and payable under this act, and
     9  adequate reserve sufficient to carry all policies and claims to
    10  maturity. In establishing the premiums payable by any
    11  subscriber, the board may take into account the condition of the
    12  premises of the subscriber in respect to the possibility of
    13  landslide damage as shown by the report of any inspector
    14  appointed by the board or by the agency. The board may change
    15  the amount of premiums payable by any of the subscribers as
    16  circumstances may require and the condition of the premises of
    17  the subscribers in respect to the possibility of a landslide may
    18  justify. The board may increase the premiums of any subscriber
    19  whose loss experience warrants a change. The insurance of any
    20  subscriber shall not be effective until the premium so fixed and
    21  determined has been paid in full.
    22  Section 503.  Surplus.
    23     The board shall set aside 5% of all premiums collected for
    24  the creation of a surplus until the surplus is sufficiently
    25  large to cover catastrophic hazard of all the subscribers to the
    26  insurance fund and to guarantee the solvency of the fund. At
    27  such point, the board shall reevaluate the set-aside and
    28  investment of the surplus and make a recommendation to the
    29  General Assembly.
    30  Section 504.  Insurance program.
    20040S1035B1445                 - 12 -     

     1     (a)  General rule.--Any owner of a structure located within a
     2  landslide-prone region who desires to become a subscriber to the
     3  insurance fund for the purpose of insuring a structure in the
     4  region against damage from landslides shall make a complete
     5  application as prescribed by the board to the board, its agents
     6  or insurance producers. Upon receipt of an application, the
     7  board shall make an investigation as may be necessary if the
     8  application complies with the rules and regulations of the
     9  board. Within 60 days after the request for an application is
    10  received the board shall issue a certificate showing the
    11  acceptance of the application and the amount of premium payable
    12  by the applicant for one, two or three years as the board may
    13  establish. No insurance shall become effective until the premium
    14  has been paid. All premiums shall be made payable to the State
    15  Treasurer whereupon a receipt shall be issued therefore. The
    16  receipt for premium together with a certificate of the board
    17  shall be evidence that the applicant has become a subscriber to
    18  the insurance fund and is insured from the date of application.
    19  The following apply:
    20         (1)  The insurance may be subject to later reductions,
    21     and premiums adjusted accordingly, if the board determines
    22     that the amount of insurance coverage requested is in excess
    23     of the current replacement cost of the structure or the
    24     maximum amount of coverage established by the fund, whichever
    25     is less.
    26         (2)  The insurance shall be void if, upon investigation
    27     of the structure, the board determines that either landslide
    28     damage occurred before the application was submitted or the
    29     applicant is responsible for not allowing the board to
    30     inspect the structure within 60 days of receipt of the
    20040S1035B1445                 - 13 -     

     1     application.
     2         (3)  The use of the most current science available to
     3     identify landslide-prone areas shall be employed. If the
     4     property is located in a further review area within a
     5     hazardous area, the property owner may be required to
     6     complete a site assessment with a licensed professional,
     7     which may include an onsite evaluation. The property owner
     8     shall fund this assessment. This assessment may also be
     9     required before a local government accepts an application for
    10     a development permit.
    11         (4)  Notwithstanding any other provision of law, any
    12     structure repaired or restored to its original condition with
    13     moneys from the insurance fund shall not be eligible for
    14     duplicative disaster relief assistance from programs
    15     administered by the agency.
    16         (5)  In order to assist insurance producers and potential
    17     policyholders in identifying structures that could be at risk
    18     from landslides, the board shall publish and update in the
    19     Pennsylvania Bulletin a list of areas in this Commonwealth
    20     that are believed to be at risk for landslide damage.
    21     (b)  Penalty.--A person who knowingly furnishes or makes any
    22  false certificate, application or statement required under this
    23  section commits a misdemeanor and shall, upon conviction, be
    24  sentenced to pay a fine of not more than $1,500 or to
    25  imprisonment for not more than one year, or both.
    26  Section 505.  Application for increase in insurance.
    27     Additions in the amount of insurance are subject to the same
    28  standards as initial applications.
    29  Section 506.  Automatic inflation protection increase.
    30     The board shall make available to all subscribers an annual
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     1  inflation protection option on the anniversary date of each
     2  policy issued only if the total insurance remains at or under
     3  the value of the structure itself. An inflation protection
     4  increase shall not be subject to a reinspection of the
     5  structure.
     6  Section 507.  Audit by Auditor General.
     7     The Auditor General shall at least once each year make a
     8  complete examination and audit of the insurance fund, including
     9  all receipts and expenditures, cash on hand, investments and
    10  property held representing cash or cash disbursements. For these
    11  purposes the Auditor General is hereby authorized to employ
    12  agents and staff as the Auditor General may deem necessary. The
    13  expense incurred in making the examination and audit shall be
    14  certified to the insurance fund by the Auditor General and shall
    15  be paid from the program.
    16  Section 508.  Claims against insurance fund.
    17     Any subscriber to the insurance fund must file with the board
    18  a true statement of the subscriber's claim for any landslide
    19  damage and shall give to the board an opportunity to investigate
    20  and to determine whether the board will pay the claim.
    21  Section 509.  Defenses against claims and procedure.
    22     In every case where a claim is made against the insurance
    23  fund, the fund shall be entitled to every defense against the
    24  claim under the policy and shall be subrogated to every right of
    25  the subscriber arising out of such accidents against any third
    26  persons. The insurance fund may, in the name of the fund, sue or
    27  be sued to enforce any right given against or to any subscriber
    28  or other persons under this act.
    29  Section 510.  Subrogation to rights of claimants.
    30     Nothing in this act shall relieve any person, partnership or
    20040S1035B1445                 - 15 -     

     1  corporation otherwise liable therefore from any liability for
     2  damages sustained by a subscriber. The insurance fund shall be
     3  subrogated to the rights of any property owner's insurance under
     4  this act.
     5  Section 511.  Insurance companies may cover risk.
     6     Any insurance company may issue policies covering the type of
     7  risk provided for under this chapter subject to the prior
     8  approval of the Insurance Commissioner as to policy form and
     9  rates.
    10  Section 512.  Escrow of premium payments.
    11     Mortgage lenders shall escrow the landslide insurance premium
    12  payments if they offer the purchase of the insurance.
    13  Section 513.  Properties in violation of State or local law.
    14     No new landslide insurance coverage shall be provided for any
    15  property which the agency finds has been declared by a State or
    16  local zoning authority, or other authorized public body, to be
    17  in violation of State or local laws, regulations or ordinances
    18  which are intended to discourage or otherwise restrict land
    19  development or occupancy in landslide-prone areas.
    20                             CHAPTER 7
    21                       MITIGATION ASSISTANCE
    22  Section 701.  Mitigation assistance.
    23     (a)  Financial assistance generally.--The agency shall carry
    24  out a program to provide financial assistance to communities and
    25  individuals for planning and carrying out activities designed to
    26  reduce the risk of landslide damage to structures covered under
    27  contracts for landslide insurance. Financial assistance may be
    28  made available to communities and individuals in the form of
    29  grants or revolving loans for the carrying out of mitigation
    30  activities. Loans shall carry an interest rate of no more than
    20040S1035B1445                 - 16 -     

     1  3%.
     2     (b)  Grants.--The agency may make grants under this section
     3  to communities to assist in developing mitigation plans.
     4     (c)  Eligibility.--To be eligible to receive financial
     5  assistance, a community shall develop a mitigation plan that
     6  describes the mitigation activities to be carried out with
     7  assistance provided under this section. The mitigation plan must
     8  be consistent with the criteria established by the agency and
     9  provide protection against landslide losses to structures for
    10  which contracts for flood insurance are available under this
    11  act. The mitigation plan shall be consistent with a
    12  comprehensive strategy for mitigation activities for the area
    13  affected by the mitigation plan that has been adopted by the
    14  community following a public hearing.
    15     (d)  Procedure.--The agency shall notify a community
    16  submitting a mitigation plan of the approval or disapproval of
    17  the plan not later than 120 days after submission of the plan.
    18  If the agency does not approve a mitigation plan submitted under
    19  this section, the agency shall notify, in writing, the community
    20  submitting the plan of the reasons for the disapproval.
    21     (e)  Limitation.--Amounts provided under this section may be
    22  used only for mitigation activities specified in a mitigation
    23  plan approved by the agency. The agency may approve only
    24  mitigation plans that specify mitigation activities that are
    25  technically feasible and cost-effective and that are cost-
    26  beneficial under Chapter 5.
    27     (f)  Approval.--The agency shall approve funding for
    28  mitigation plans based on criteria that include:
    29         (1)  Criteria under subsection (e).
    30         (2)  Proposed activities to address repetitive loss
    20040S1035B1445                 - 17 -     

     1     structures and structures that have incurred substantial
     2     damage.
     3     (g)  Matching funds.--The agency may require a community to
     4  match grant funds.
     5     (h)  Oversight.--The agency shall conduct oversight of
     6  recipients of mitigation assistance to ensure that the
     7  assistance is used in compliance with the approved mitigation
     8  plans of the recipients and that any matching fund requirements
     9  are fulfilled.
    10     (i)  Failure to comply.--If the agency determines that a
    11  community that has received mitigation assistance has not
    12  carried out the mitigation activities as set forth in the
    13  mitigation plan or has not secured required matching funds, the
    14  agency shall recapture any unexpended amounts and redeposit the
    15  amounts in the assistance fund.
    16  Section 702.  Landslide Assistance Fund.
    17     The Landslide Assistance Fund is hereby established as a
    18  restricted account in the State Treasury. The assistance fund
    19  shall be administered by the agency and shall be comprised of
    20  moneys appropriated for purposes of this chapter. All moneys in
    21  the fund and the interest accruing thereon are appropriated to
    22  the agency on a continuing basis to carry out the provisions of
    23  this chapter.
    24  Section 703.  Construction permits.
    25     No Commonwealth agency shall approve any financial assistance
    26  for the acquisition of land for construction purposes in any
    27  area that has been identified by the agency as an extremely
    28  hazardous zone without approval to proceed by the agency based
    29  on the results of a risk assessment.
    30                             CHAPTER 9
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     1                 PROGRAM ADMINISTRATION AND FUNDING
     2  Section 901.  Regulations.
     3     The agency, in conjunction with the board, may promulgate
     4  rules and regulations and establish other conditions of the
     5  policies as it deems just and expedient in keeping with the
     6  fulfillment of the purposes of this act, including reasonable
     7  classification of risks eligible for coverage under this act,
     8  limits of coverage and rules covering the adjustment and
     9  settlement of claims.
    10  Section 902.  Agency report.
    11     The agency shall make an annual report on the program and on
    12  experience with landslide insurance sales through producers to
    13  the General Assembly. Each report shall include mitigation
    14  efforts, an analysis of the cost-effectiveness of the program,
    15  accomplishments or shortcomings of the program and
    16  recommendations for legislation regarding the program.
    17  Section 903.  Program funding.
    18     The program shall be funded by the General Assembly through
    19  an appropriation of moneys to the Pennsylvania Emergency
    20  Management Agency until which time the insurance fund and
    21  assistance fund are deemed self-sufficient by the General
    22  Assembly.
    23  Section 904.  Reimbursement.
    24     The program shall reimburse any Commonwealth departments for
    25  agreed-upon costs of services that aid in administering the
    26  program.
    27  Section 905.  Appropriations.
    28     (a)  Insurance fund.--The sum of $2,500,000, or as much
    29  thereof as may be necessary, is hereby appropriated to the
    30  Landslide Insurance Fund for the fiscal year July 1, 2004,
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     1  through June 30, 2005.
     2     (b)  Assistance fund.--The sum of $2,500,000, or as much
     3  thereof as may be necessary, is hereby appropriated to the
     4  Landslide Assistance Fund for the fiscal year July 1, 2004,
     5  through June 30, 2005.
     6     (c)  Agency.--Moneys in the Landslide Insurance Fund and the
     7  Landslide Assistance Fund are hereby appropriated to the
     8  Pennsylvania Emergency Management Agency in such amounts as may
     9  be determined annually by the Governor to be used for the
    10  specified purposes of this act.
    11     (d)  Additional appropriations.--If, upon completion of the
    12  annual examination and audit, it is determined that the total
    13  asset value of either the insurance fund or assistance fund is
    14  less than $2,500,000, such additional sum as may be necessary to
    15  increase the total asset value of the fund or funds to
    16  $2,500,000 shall be appropriated.
    17  Section 906.  Cost of administration.
    18     The board shall keep an accurate account of the money paid in
    19  premiums by the subscribers and the disbursements on account of
    20  damages to premises. If, at the expiration of any year there
    21  shall be a balance remaining after deducting the disbursements,
    22  the unearned premiums on undetermined risks and the percentage
    23  of premiums paid or payable to create or maintain the surplus
    24  provided under this act, and after setting aside an adequate
    25  reserve, the board may determine to allocate to the cost of
    26  administering the insurance fund.
    27  Section 907.  Commissions.
    28     Moneys from the insurance fund shall be available to pay a
    29  one-time commission as determined by the board to insurance
    30  producers who forward applications for landslide insurance to
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     1  the board if a policy is issued pursuant to an application
     2  submitted by an insurance producer. The amount of the commission
     3  shall be determined by the board on an annual basis.
     4                             CHAPTER 21
     5                      MISCELLANEOUS PROVISIONS
     6  Section 2101.  Effective date.
     7     This act shall take effect July 1, 2004, or immediately,
     8  whichever is later.















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