More than two dozen property owners are preparing to sell their homes to Essex County as part of a federal buyout program nearly 19 months after Tropical Storm Irene tore through the Adirondacks.
The Federal Emergency Management Agency recently told Essex County officials that 26 properties deemed "substantially damaged" by Irene have received final approval for the buyout program. A fact sheet issued to the press by county Community Resources Director Mike Mascarenas notes that the "final approved application" totals $2,678,394, which represents 75 percent the project's total cost of $3,571,191.
"FEMA will only approve up to 75% of the total project costs," the fact sheet says.
Jay town Supervisor Randy Douglas, chairman of the Essex County Board of Supervisors, said he knew the buyout process would be lengthy, and he's glad the end is in sight.
"We are very happy with the end result, to have the substantial properties now approved; we're just waiting to sign the contract," he said.
Nineteen of the homes are in the town of Jay, four are in Keene, and there is one each in Essex, North Hudson and Westport.
Essex County is still waiting to receive a contract from FEMA. Once that's signed, the county has 120 days to determine the "pre-disaster fair market value" of the homes. Then the county will make an offer to the property owners, who have 30 days to accept or reject it.
"Once the deal has been made with the homeowner, Essex County will then retain ownership of the property," the fact sheet says. "It will then be the job of the county to demolish the home and restore the site which can only be utilized for open space use. The county will then turn the property over to the town in which the buyout occurred."
Mascarenas told the Enterprise that only homes deemed substantially damaged qualify for the buyout program.
"In order to qualify for the substantially damaged (category), you have to reside in the 100-year flood plain and be damaged greater than 50 percent," he said.
Mascarenas said a home could have been completely destroyed by Irene, but if it was outside of the 100-year flood plain, it doesn't qualify as "substantially damaged" under FEMA's buyout rules.
Eleven properties applied for buyouts through FEMA's "non-substantially damaged" program, but the county is still waiting to hear if they qualified. Mascarenas said he thinks some of those properties will qualify.
The total buyout project is expected to cost about $3.57 million, but the county can only seek reimbursements of up to about $2.68 million for the purchase, demolition and restoration of the properties. Mascarenas said in most cases, homeowners will receive less than 75 percent of their property's pre-disaster fair market value.
Mascarenas used the example of a home valued at $100,000 prior to the storm. Using rough figures of $10,000 for demolition, $10,000 for site restoration and $5,000 for closing costs, Mascarenas said the total buyout process would cost about $125,000. The 75 percent from FEMA would equal about $93,000, and the cost to the county would be about $25,000, leaving the property owner with approximately $68,000.
Some property owners, like those who received federal insurance payments, would receive even less than fair market value, Mascarenas said.
The county is responsible for establishing fair market value of the properties, which Mascarenas said can be tricky because some of the homes sustained heavy damage.
"So they would say, 'OK, if this was in good condition - inhabitable - this is what it would have been worth today,' because some of them don't even exist anymore," he said. "So the appraiser has got to utilize the information they had on that home prior to (Irene). They look at old deeds, they look at old assessments - the house had this many bedrooms, this many bathrooms - the sales in the area were X, Y and Z. And that's how they determine that fair market value."
Mascarenas said that if homeowners disagree with the county's figures, they can hire their own appraisers for second opinions. If a second opinion is within 10 percent of the original appraisal, FEMA lets the county use the higher of the two. If it's greater than 10 percent, a third appraisal is done, and all three figures are averaged, and that number is considered the fair market value, Mascarenas said.
Under federal rules, homeowners are not allowed to demolish and restore their own properties, Mascarenas said.
Nearly 70 property owners expressed interest in the buyout program when the county started the process. Some didn't qualify, while others decided to stay and rebuild, Douglas said.
"People don't want to leave the town that their families grew up in, and the town that they raised their own families in," he said. "To pack up and move out, you move everything, all this history and the memories you had, from he home you raised your families in."
Douglas said he hopes the homeowners who plan to accept a buyout will remain in his town or in the county.
County officials thanked the state Office of Emergency Management for helping with the buyout process.