Ventura, 38, lives in the West Nanticoke section of Plymouth Township, Pa. He bought his house in 2007 and remodeled the building, moved inside in 2008 and was flooded in 2011. He used money from his flood insurance payment to rehab the home, but now has another choice to make.
Federal flood insurance rates will likely continue to increase, said Stephen Bekanich, director of the Bureau of Recovery and Mitigation at the Pennsylvania Emergency Management Agency. He visited Plymouth Township with other state officials for a meeting about a buyout program run by PEMA and the Department of Community and Economic Development.
Bekanich said he didn’t know directly what would happen, but from what he hears in meetings, the rates for the flood insurance program will increase annually. For some property owners, the increases might not stop until rates are $5,000, $7,000, or in some scenarios — as much as $20,000 per year, he said.
According to the Federal Emergency Management Agency, legislation designed to make the National Flood Insurance Program more sustainable will create rate increases for many property owners. Many policyholders have been paying subsidized rates that don’t reflect the true risk of the properties.
For Ventura, who attended the meeting, those rate increases feel like he’s being pushed out. He’s holding a piece of property he’s invested in that doesn’t have much resale value because flood insurance payments for the new owner could be high. He plans to see what kind of offer PEMA makes.
Complicating that route is the way PEMA calculates what to offer property owners. The agency uses the pre-flood value of the property and deducts any reimbursement a property owner received for which he or she doesn’t have a receipt. The idea is to make sure people are using that money for appropriate expenses — as opposed to a vacation, for example.
“If they make an offer, let’s say they offer $80,000 for the house, for example, they’re going to take $40,000 right off,” Ventura said, if the owner can’t produce receipts for all the work.
Five years after floods hit the township, it might be difficult to track down all those receipts, said Ed Brennan, 53. In some cases, people did work without giving receipts.
“The house is fixed,” he said. “It should be appraised as it is now.”
Regulations, however, require PEMA to use the pre-flood value, Bekanich said.
The process is voluntary for property owners, said Thomas Hughes of PEMA.
“We’re trying to make it as appealing as possible,” said Donna Enrico with DCED. “We don’t want property or people put into harm’s way when the next natural disaster occurs, whatever it is. We really want to get folks out of the floodplain for whenever the next natural disaster occurs.”
Plymouth Township officials are writing a letter of intent that will open the program to residents of the municipality. Anyone who is interested should contact the township for information on how to proceed.
bwellock@citizensvoice.com
570-821-2051, @CVBillW
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