Liability Concerns Slow County’s Okay Of Grant Program

SNOW HILL — Hurricane season began Sunday and a new federal Hazard Mitigation Grant Program (HMGP) looks to provide funding to help residents in Worcester County elevate their homes to guard against flooding. Unfortunately, the way the program is written could leave county government in the lurch if any of the projects run into problems.

The County Commission has indicated interest in the grants but isn’t ready to commit until more information is gathered.

The biggest issue the commission had with HMGP is that there might be a lot of hidden liability with each project since the county would have to act as the sponsor.

“We, the county, would have to manage the project,” said Fred Webster, director of Emergency Services.

To qualify for a grant through HMGP, a private resident would have to be willing to put up 25-percent of the cost of elevating their home, with the remaining 75-percent of costs paid for by FEMA.

“FEMA pays up to 75 percent of the project cost,” reads the HMGP summary. “Either the state or the applicants covers the remaining 25-percent, although it need not be in cash. In-kind services and materials can be used.”

However, FEMA would not pay the money directly but would instead have Worcester put forth the money and then reimburse the county after the fact.

There is some interest in using that model with at least five property owners along the coastal bays interested in pursuing grant funding. The county wants to help those residents protect themselves and their property through a house elevation, said Sonny Bloxom, county attorney. But so many things could go wrong and leave Worcester liable.

“If you get an estimate to do the raising, etc, and you do foundations but they could end up costing more once you get done there,” said Bloxom. “Then let’s say the homeowner doesn’t have any more money and you’ve already used the max of the reimbursement from the feds. Then what do you do? You’ve got a person’s house in the air.”

County administration had similar concerns. Harold Higgins, Chief Administrative Officer, pointed out that there are serious questions regarding “who pays the 25-percent local match, what assurances do we have that FEMA will reimburse the county for the 75-percent up-front money with HMGP funds, time and effort required of county staff to establish and manage the grant program, time and effort of county staff to manage the bidding, contracting and construction management process for elevating the homes, post-construction warranty issues and future liability of the county and any post-grant restrictions on property owners, to name just a few.”

The plan “has more holes than Swiss cheese,” remarked Commissioner Jim Bunting. Adding to that uncertainty, Worcester would be more or less taking point on the project. Baltimore County has attempted one project with less than positive results, with the resident incurring several violations during the elevation.

“The elevating of the residents went well. The problem was that after it was elevated there were certain things in the guidelines that the property owner didn’t do,” Webster said.

When asked to participate, the Somerset County Commission chose not to serve as the sponsor for the grants but a non-profit within that county did form with the intent to manage HMGP in the area.

There have been 60 statewide responses to the project so far, noted Webster, but all those amount to are “expressing interest.”

“I can express an interest in owning a yacht,” replied Commissioner Virgil Shockley. “That doesn’t mean that I’m going to go out and buy one.”

It might be better to let a few of the other counties experiment with HMGP first, agreed Commissioner Judy Boggs.

Admitting that there are some risks to the program, Commission President Bud Church asked his colleagues to not dismiss the opportunity right away. For all of the potential pitfalls, Church reminded the commission that county residents have been hard hit by flooding and storm surge in years past and that grant funding to help raise houses could save lives and property.

“I do know that there are areas that could use this money to help people in our community. And those people are very sincere about wanting to get their houses raised,” he said. “They’re willing to contribute the 25-percent. You can look at the negatives all day long. I try to look at both sides, the negatives and the positives.”

No decision was made this week to either participate in or decline the HMGP. The commission asked that more research be done, especially in regards to how far out the county’s neck would be if any of the projects went sour. Staff was instructed to reach out to those who have already taken part in the program, such as the non-profit that formed in Somerset specifically to manage the federal grant funding.

If the commission ultimately decides to pass on sponsoring the program they could leave it open to a similar non-profit.

 

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