Capitol Letters: Disaster Recovery Housing Program passes committee

State. Rep Megan Jones

Last week the House Local Government Committee reported out of committee House Study Bill 246, which enhances and improves Iowan's recovery efforts for communities affected by natural disasters. This comprehensive legislation encompasses several important programs and regulatory changes that will benefit homeowners, renters, and the broader community. Here are the main highlights:

1. Natural Hazard Mitigation Financing Program

• Creation of a new program: The bill establishes the Natural Hazard Mitigation Financing Program, designed to provide loans to eligible entities for projects that mitigate the impact of natural hazards.
• Revolving Loan Fund: A dedicated Natural Hazard Mitigation Revolving Loan Fund will be created, funded through state appropriations, federal grants, and loan repayments. This fund will be managed by the Department of Homeland Security and Emergency Management in consultation with the Iowa Finance Authority.
• Project eligibility: Projects eligible for funding include flood control structures, zoning changes, and building code enforcement, among others.

2. Disaster Recovery Housing Assistance Program

• Expanded assistance: The bill clarifies that disaster recovery housing assistance will be available to both homeowners and renters affected by natural disasters, as specified in the governor's disaster emergency proclamation.
• Financial assistance definition: The legislation defines "financial assistance" to include grants, loans, and forgivable loans, ensuring that aid is accessible to those in need.
• Administrative cost limit: The IFA is restricted to using no more than 5% of the funds for administrative costs, ensuring that the majority of resources go directly to assistance.

3. Disaster Recovery New Housing Program

• Tax benefits: The bill introduces a new tax provision allowing individuals and businesses to subtract qualifying state disaster recovery new housing grants from their taxable income, encouraging investment in recovery efforts.

4. Post-Loss Assignment of Benefits

• Consumer protections: The bill establishes regulations for post-loss assignments, ensuring that residential contractors cannot engage in deceptive practices when handling insurance claims. This includes prohibiting contractors from rebating deductibles or imposing fees for canceling assignments.
• Contract requirements: Contractors must provide detailed itemized descriptions of work to be performed and inform clients of their rights under their insurance policies.

5. Licensing and Regulation of Adjusters, Appraisers and Umpires

• Stricter licensing requirements: The bill enhances the licensing process for public adjusters, independent adjusters, and appraisers, ensuring that only qualified individuals operate in Iowa.
• Financial responsibility: Applicants must secure a surety bond to demonstrate financial responsibility, protecting consumers from potential losses due to unlicensed or unethical practices.
• Penalties for violations: The legislation establishes penalties for adjusters and appraisers who violate licensing laws, including potential felony charges for serious offenses.

6. Iowa Economic Emergency Fund

• New appropriations: The bill allocates 10% of the maximum balance of the Iowa Economic Emergency Fund for disaster response and recovery activities, contingent upon a governor's disaster proclamation.
• Nuisance property remediation: The bill also includes funding for the Nuisance Property Remediation Assistance Fund, supporting efforts to address blighted properties in disaster-affected areas.

House Study Bill 246 represents a significant step forward in Iowa's disaster recovery efforts. By establishing new funding mechanisms, enhancing consumer protections, and improving the regulatory framework for adjusters and contractors, this legislation aims to create a more resilient Iowa.

The next Storm Lake Legislative Forum is Saturday, March 15, at 10 a.m. at King’s Pointe Resort. Email Jones: megan.jones@legis.iowa.gov.