A new executive order intended to help homeowners rebuild after Hurricane Sandy actually could drive many of them from coastal areas of the New Jersey shore.
That’s what some are warning following Gov. Chris Christie’s announcement of tough state standards for rebuilding in the wake of the storm.
Christie said New Jersey would adopt Federal Emergency Management Agency advisory maps as the basis for new state construction rules. The maps FEMA adopts determine federal flood insurance rates.
The new state rules, which stipulate how people can rebuild their homes, could make home ownership in portions of the New Jersey shore unaffordable, attorney and Margate city solicitor John Scott Abbott warned.
“The bottom line is — on many homes — the cost to (raise the house and put it on driven piling) exceeds what the home is worth,” said Abbott, whose bayfront Margate home had 3 feet of water inside during the storm. “What you’re seeing now in parts of (Ventnor Heights) is — between existing mortgages and the cost of living somewhere else — you’re seeing a lot of people walk away and abandon their homes.”
Abbott isn’t alone in his concern.
Ventnor Mayor Michael Bagnell said the rules, which place the entire bayfront and sections of low-lying Ventnor Heights in velocity zones, could make rebuilding financially impossible. Worse, Bagnell said, “the property values would tumble in those areas.”
If many people are unable to afford to raise their homes to meet the new flood elevations, they could see their flood insurance premiums rise by thousands — if not tens of thousands — of dollars if FEMA adopts the data as official rate maps. Many homeowners who have paid off their mortgages now are considering dropping their flood insurance policies and taking a chance that the next storm won’t be as bad.
If property values plummet, the ratable base in shore towns also would drop, causing municipal and countywide financial implications, said Abbott, whose house is about 5 feet below the advisory base flood elevation. The range of elevation increase for most homes is between 1 foot and 5 feet.
“My flood insurance is looking (to increase) at least $2,000 a foot (in elevation). If that’s the case, the economic value of my home, as well as thousands of other homes, is greatly hit,” said Abbott, who is representing homeowners and developers. “(Christie) really doesn’t understand that when he imposes these mandates.”
Abbott said said Christie’s order, combined with new flood insurance rates, “is an economic catastrophe in the making.”
Christie said the new policy is intended to help end at least one element of uncertainty for those homeowners faced with recovering from near-catastrophic flooding. The order to adopt the height requirements in the FEMA advisory maps released in December, plus one foot of additional elevation, is the first statewide baseline for flood maps, according to the Department of Environmental Protection.
“There is no way to avoid the cost of what happens after a storm has passed, and I would love to wave a magic wand and make it all go away,” Christie said during Thursday’s news conference in Seaside Heights. “I’m laying out the problems, and this is our solution to the problem. Folks have to make decisions, and some will be hard decisions.”
The state will use the incentive of a streamlined permitting process and a waived fee as a way to encourage property owners to rebuild to the new standards, DEP spokesman Larry Hajna said. Property owners in flood zones need a new flood hazard control act permit if their house or business suffered damage that equals or exceeds 50 percent of the market value of the structure.
If property owners apply for a new permit and agree to rebuild to the new standards, the DEP will streamline the permit and waive the $500 fee, Hajna said. If property owners do not rebuild to the new standards, they will be forced to go through the lengthy and potentially expensive process of obtaining a new permit.
The advisory maps more than doubled the highest-risk velocity zones, now — in many cases — including areas along the backbays and interior sections of barrier islands for the first time.
Construction in velocity zones must account for 3-foot waves atop floodwaters. That means houses in the zone must be built on driven piling, something that is economically impossible for many homeowners who have houses on concrete blocks or slabs.
Confusion over the advisory maps and whether municipalities should incorporate the new data as part of flood zone ordinances has persisted since FEMA released the maps. Town officials, including Bagnell and Brigantine engineer Ed Stinson, said the velocity designations do not have sound science behind them and further studies need to be done.
Another logistical problem in shore towns where houses are on tiny lots is whether contractors will have the room to move houses while a new piling foundation is driven, said Nancy Leonetti, co-owner of David Construction LBI House Raising. “In these communities, there’s no place to put the houses,” she said.
Flooding during Hurricane Sandy left nearly 2 feet of water inside parts of Mary Harper’s Margate house. She still is waiting for a check to move forward with repairs.
Harper said she won’t spend $30,000 to raise the house to qualify for affordable flood insurance because the house is not worth it.
“Worst-case scenario, we have to look at if there’s another bad storm, and we haven’t been able to get flood insurance. We’d seriously have to look at demolishing the building and selling the land and going elsewhere,” she said.
Contact Sarah Watson:
Follow @acpresssarah on Twitter