Flooded residents can raise or raze

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http://www.chron.com/cs/CDA/story.hts/topstory/966260

July 12, 2001, 9:32AM

Flooded residents can raise or raze

Rule maze tangles home rebuilding

By LISA TEACHEY

Copyright 2001 Houston Chronicle

Some flood-plain residents trying to rebuild after Tropical Storm

are finding themselves with two choices -- raise their houses or raise their

taxes.

A southwest Houston resident, Cameron McCulloch, is one of them. Like many

others, he is learning that despite what he paid for his property, when it

comes to a flood, it's the value of the structure that matters.

D. Fahleson / Chronicle

W. Cameron McCulloch stands in the flood damaged living room of his

Braeswood-area home. McCulloch has not been able to get a building permit

because of FEMA regulations that forbid a permit from being issued if the

repairs total more than 50 percent of the home's value.

Federally mandated rebuilding restrictions, complicated by the way

properties are assessed in County, mean some homeowners can't even

get permits from the city to rebuild until they meet flood control

requirements.

" I thought we'd just fix it, " McCulloch said Wednesday of the ranch-style

home located north of Brays Bayou between Buffalo Speedway and Stella Link.

" But my problem is the city won't let me fix my house. "

The home he shares with his wife, , and two small children suffered

about $170,000 in damage last month during Tropical Storm . They

purchased it for about $400,000 in 1999.

The McCullochs have the money to make the repairs, but can't get a permit

from the city because the cost of the repairs is more than 50 percent of the

home's market value.

According to County Appraisal District records, the total market

value of McCulloch's home is $433,900. The land value accounts for $286,700,

leaving the actual house worth only $147,200.

When the city of Houston decided to join the National Flood Insurance

Program about 30 years ago, the City Council had to adopt an ordinance

complying with federally set guidelines.

One of the guidelines is that cities participating in the program cannot

grant rebuilding permits to homes with more than 50 percent damage until the

homes are in compliance with minimum flood-proofing standards.

For single family residential structures, that means the finished floor

elevation must be at least a foot above the base flood elevation.

Ross , of the Federal Emergency Management Agency, said the rule

is necessary.

" Any new development would have to meet the minimum criteria, "

said.

The only way the McCullochs can obtain a permit is to bring their home into

compliance. That leaves two options, both costly.

The first option is to jack up the house. That can cost as much as $50,000

for the first foot and thousands more per inch after that.

" I know I don't want to do that, " McCulloch said. " It can't be good for your

house. There could be plumbing and sewage problems, not to mention the costs

to re-landscape.

" I don't want to trade my headache for a stomach ache. "

The second choice is to hire an independent appraiser to assess the home at

a value that would allow McCulloch to squeeze under the 50 percent rule.

But if he does that, the new appraisal will be used by the appraisal

district to determine his taxes.

" My taxes would essentially triple, " McCulloch said.

Of course, McCulloch could abandon his house altogether by either tearing it

down and rebuilding, selling it under value or selling it to the county in a

government buyout program for homes in the flood plain.

" Under all three of those scenarios, a new house will be built worth more

than mine, " McCulloch said. " I'm kind of damned if I do and damned if I

don't. "

McCulloch blames the bureaucratic tangle of local and federal government

entities involved.

Mostly, though, he and others say the county appraisal system is the

underlying problem.

But Sands Stiefer, the county's chief deputy appraiser, said the appraisals

are not meant to be benchmarks for repairs.

" All we are doing is what we are constitutionally required to do, and that

is to place a correct market value on the property, " Stiefer said.

Some homes in McCulloch's neighborhood have land values thousands of

dollars -- sometimes as much as $200,000 -- more than the structure's value.

Appraisers allocate value to the land first. And because of state laws

capping the amount taxes can be raised every year to 10 percent, that often

leaves little room for the value of the home.

City Councilman Mark Goldberg said he believes the land values are kept

artificially high in neighborhoods like McCulloch's, where many purchasers

buy the property, raze the home and build a bigger house.

The new home would bring in more tax dollars.

" I don't know what the solution is, " Goldberg said. " The city is that space

between the rock and hard place. The city has to follow the federal

guidelines. "

Mike Loomis, the city's flood plain manager and the man who grants the

rebuilding permits, agrees.

Loomis said his office and several satellite branches are open to help

residents.

Goldberg said he plans to talk to federal officials. and encourages

residents to complain to their county commissioner about the the appraisals

and write their congressman.