Financing Post Hurricane Sandy Reconstruction

As Treasurer of our condominium association, given the 4-5 month expected turnaround for getting any flood losses reimbursed from NFIP insurance, I had the misfortune of researching financing options for repairing and rebuilding any damage from Hurricane Sandy. It is important to note that there are rules stated in the by-laws that require a certain majority for either an assessment or a loan, with the latter being more stringent.

First and foremost, request an advance from your insurance adjuster (this requires signing a form). You can read about the claim filing process by clicking "How to File a FEMA Flood Loss Insurance Claim." You can expect to receive an advance of no more than 10% of what the adjuster thinks is going to be your damage. Yet, I have seen advances of $5000-10000 being made on the spot during the loss scoping. Unfortunately, those who are filing repeat flood loss  claims cannot get an advance,  as noted in "Getting Paid for a Repeat FEMA Flood Loss Insurance Claim Is Going to be Tougher".

Besides this, there are the three choices of financing post hurricane construction.

Special Assessment to supplement General Reserve funds

Most condominium associations have a general reserve fund that can take on small repairs or unexpected costs. Of course, Hurricane Sandy's losses exceeded most reserves. A special assessment generally requires a majority vote, as explained in each condominium association's by-laws. A special assessment is the path of the lowest resistance, although it is most onerous to owners.

A bridge loan for construction from a bank

For Hoboken residents, a bridge loan can be a viable alternative since banks in town can help. Other than Hudson City Savings bank, which declined to provide a business loan for reconstruction, many local banks do provide loans to condominium associations, with monthly or quarterly maintenance as collateral. Loans are given for a period of six months to 5 years, plenty of time to recoup losses from flood insurance. A friend has had success with First RepublicNational Bank. BCB Community Bank's Bayonne office also underwrites these types of loans. Rates are a few basis points over prime, and collateral requirements vary, so contact the banks directly.

A SBA Disaster Loan for HOAs

If all else fails, you can contact the Small Business Administration for a disaster loan. Rates are much higher if you do qualify for other loans, so understand that this federally backed agency is the lender of last resort. You need all estimates for repairs, as well as some sort of documentation from your adjuster. You can read more here: http://www.sba.gov/content/fact-sheet-associations

According to their website:

Before SBA will disburse any loan funds, we must have confirmation that all the money necessary to complete the repairs is available. Therefore, we must have documentation supporting the total project cost of the repairs and the amount of anticipated insurance recoveries. The damages to the common areas must be clearly separated from the damage to the individual units to establish eligibility.

For additional information, please contact our Customer Service Center. Call 1-800-659-2955 (TTY: 1-800-877-8339) or e-maildisastercustomerservice@sba.gov

For additional tips please read: "5 Money Saving Tips for Hurricane Sandy Victims"

Getting Paid for a Repeat FEMA Flood Loss Insurance Claim Is Going to be Tougher

Devastated by Hurricane Sandy after being hit by Irene? Filing a repeat FEMA flood loss insurance claim? Do your homework!

The process of filing a flood loss claim is explained in my article, “How to File a FEMA Flood Loss Insurance Claim.” Owners file the claim over the phone, providing their date of loss, flood insurance, property and contact information. The case is assigned a claim number, and an adjustment company. The adjuster sends a field agent, who scopes the damage, with input from the owners. In a few days, he prepares and estimated proof of loss (POL), with allowances for damages room by room, including cost of clean up, drying, and repairing.

There is however one major difference for insured people filing a repeat flood loss claim on the same property. Homeowners and businesses must demonstrate that any allowance they received from a prior flood loss claim was indeed spent doing the necessary repairs. This calls for meticulous documentation of the prior loss' expenses, while owners are struggling with current repairs while being displaced from their homes.

Photo copyright: Dalia

Let's assume that an owner did in fact make all necessary repairs. However, the owner lost the contractor's receipt in the second flood. The insurance adjuster would be less than sympathetic if the claim is not substantiated, solely because of the existance of a prior flood loss claim.

The owner would also not get the benefit of the doubt from the insurance adjuster if he made all necessary repairs, but the contractor did not break down every repair in as detailed a manner as the proof of loss from the insurance company. For example, if the insurance reimbursement was for a door, a frame and a threshold, but the invoice just shows the door installation, the other parts not being broken out, the homeowner may not get reimbursement from the insurance for the other parts

It could also take longer to process the claim, as the adjuster needs to investigate that all the repairs the previous claim paid for were indeed made, essentially meaning twice the paperwork for him as well.

So filing a repeat FEMA flood loss insurance claim? Gather all the Irene receipts and match them against the insurance proof of loss. Check off what was repaired, and add up what was not. Even if the latter items were badly damaged from Hurricane Sandy, FEMA will not pay for them again and you must budget for out of pocket repairs.

 

Hurricane Sandy Ravaged Hoboken Finally Celebrates Halloween

Halloween in Hoboken, NJ a mile square town battered by flooding from Hurricane Sandy, finally came on November 12.

Enjoying the unseasonably warm 65 degree weather, hundreds of families upheld the Hoboken tradition of marching down in costume along Washington Street, once voted "Top 10 Great Streets in the Country” (American Planning Association), in the Annual Ragamuffin Parade.


Princesses, superheroes, witches and zombies went trick or treating prior to the start of the parade. By 4 pm, many Washington Street storefronts, the primary source of Halloween candy in "the most walkable city in America (WalkScore.com)" were posting the "sorry no more candy" sign.

As numerous residents evacuated after Hurricane Sandy submerged parts of the town in flood water and left a Herculean clean up task and week-long power outages, Halloween celebrations had to be rescheduled thrice, adding to some confusion. Several businesses missed the memo, which was publicized on City of Hoboken (@cityofhoboken) Twitter account and via email, and many parents had already packed costumes away. Working parents who had missed a week of work lamented the Halloween parade should have been held on a weekend instead of a Monday. A few stores, like Aspen Marketplace, had given out candy on October 31, when the flood waters from Hudson river still submerged parts of the town and most of Hoboken was dark.

Stores on First Street, which were ravaged by crippling floods, generally opted out of the festivities. Since Hurricane Sandy, a handful of businesses on First and Newark street, have decided to permanently close.

Still Halloween spirit was on display as kids beamed in their costumes, and businesses, especially the realtors, handed out high value chocolate goodies instead of mints and sugar candies. Since early November, bagged candy had been on sale at neighborhood retailers like Target for 70% off.

The daylight savings time change likely cut into the participation in the costume contest, which awards trophies in various age categories, as well as for best dressed family and carriage. Even then families from Hoboken and out of town decked out in creative costumes such as “Pirates of the Hudson,” “Beekeeper and his bees,” and “Sesame Street.” New to the mix was a vintage car reminiscent of “Chitty Chitty Bang Bang.”

In a town that still has FEMA and American Red Cross outposts scattered along with dozens of utility vans and sanitation trucks, Hoboken's belated Halloween celebration was one more step towards residents moving on from the devastation caused by Hurricane Sandy. To donate to rebuild Hoboken, please visit the Rebuild Hoboken Relief Fund website.

Note: Also published at Yahoo Voices. Author retains copyright.

Preparing for the Power Outage following Hurricane Sandy

With Hurricane Sandy fast approaching, it is a matter of when and not if power outages will occur in the New York/New Jersey area. Last year, during Hurricane Irene, we lost power for several hours in my neighborhood, but the power outages persisted for several days in many of the suburbs. We do not have a generator.

My checklist is modified from that offered by the American Red Cross, which is found here. I will not duplicate it. I had earlier prepared my disaster kit from ready.gov, and my financial checklist kit using my own ideas.

I have multiple surge protector strips but plan to disconnect all non essential appliances overnight.

Refrigerator

According to the American Red Cross, an unopened refrigerator will keep foods cold for about 4 hours. A full freezer will keep the temperature for about 48 hours (24 hours if it is half full) if the door remains closed. I have the fridge set to "turbo" cool and freeze, the coldest settings.

I bought a couple of Styrofoam coolers for $3 each at a grocery store. The plastic coolers were not in stock. I have ice, but more importantly, I have ice packs that are far less messy. I have been buying non perishable veggies (butternut squash, yam, tomatoes) which will last outside the fridge. I plan to cook whatever is left in the days we do have power.

I have a half gallon of fresh milk and some cheeses which we will snack on when the light goes out. I have shelf stable Horizon Organic pouches (plain and flavored) which do not need refrigeration.

Fruits that last outside the fridge, like pomegranates, bananas, apples are what is on hand.

We have some ice cream and some frozen meat products, we will eat the first and keep the second in the cooler for as long as it does not smell funny.

Oven/Stove

Thank heavens we have a gas oven, so I am keeping my fingers crossed that we would be able to use it during the power outage. However, our utility has warned that gas service may be suspended if water enters the system. I will keep an eye on the pilot light, which can turn off from gusts. When I had an electric stove top, we used a charcoal grill to cookout when it was not raining.

Dishwasher

I plan to turn off the fuse for the dishwasher tonight, which means I will run it when it gets close to full. If it appears that the power outage will last more than a couple of days, I plan to use paper plates and plastic cups.

Laundry

We have the luxury of a washer dryer at home, and I am emptying my stack of laundry when the power is still on, even if that means running a half load.

Cellphones/Laptops

I did not bother to buy a non cordless phone because my phone connection is VOIP. This means the cellphones are staying on charge as long as possible. My kid uses our old cellphones as toys, so those are on charge as well. The laptops are loaded with important financial information.

Entertainment

With subway, bus and train service suspended in the New York metro area, and all area schools closed, entertainment is key. I have arts and crafts on hand to entertain the kids. We also have board games for the family. I also picked up some glow chalk and plastic toys for some fun in the dark as part of my emergency shopping trip.

Water

There is a chance that water service is suspended if pumps fail during the power outage or somehow public water becomes contaminated (god forbid). I will be filling the bathtub and large pots with water for "hygiene" usage so we do not have to dip into our bottled water supply. We typically drink filtered water, but prefer bottled or boiled water during emergencies for preventing waterborne diseases.

Alarms

In case of a prolonged power outage, our hardwired carbon monoxide, smoke and burglary alarms will start beeping. Unfortunately, we will have to just live with that. If it gets to be too much for my children, our car's gas tank is full and it is in a safe, dry place close to us.

Hurricane Sandy: Preparing for Hurricane, Protecting Financial Records Ahead of Disaster

Frankenstorm! Monster Hurricane! Perfect Storm!

As Hurricane Sandy aims for New York and New Jersey, residents are preparing for the worst and hoping for the best. While www.ready.gov and NJ.com's Storm Safety Tips provide great tips, I think now is a great time to protect financial records and document and if possible safeguard valuables as well.

Here are two of my articles on the topic:

How I Am Preparing to Protect Financial and Tax Records Ahead of Hurricane

First Person: Protecting My Financial Records in an Evacuation

Photo: Thunderstorm Over The City" by George Stojkovic, freedigitalphotos.net