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09-29-1992 Brandermill MinutesBRANDERMILL COMMUNITY MEETING MINUTES SEPTEMBER 29, 1992 Supervisor in Attendance: The Honorable Arthur S. Warren Exec. Clover Hill District Supervisor Hr. Lane B. Ramsey County Administrator Admin. , Staff in Attendance: Hs. Harilyn E. Cole, Asst. to Co. Admin. Hr. Steven L. Hicas, County Attorney Hs. Theresa H. Pitts, Clerk to the Board Hr. H. D. Stith, Jr., Acting Deputy Co. Community Development Hr. Warren welcomed all to the meeting and stated the purpose of the meeting was to address issues regarding shrink/swell soils. He introduced Hr. Ramsey, Hr. Hicas, Hr. Bob Olsen, Chairman of the Commission on Soils and Foundations, and Hr. Rick Phelps, representative for Clover Hill District on the Commission on Soils and Foundations. He stated after the presentation, citizen comment would be received regarding the proposals by the County Administrator and the Commission on Soils and Foundations. Hr. Ramsey stated at the Board meeting on September 9, 1992, he had presented recommendations to the Board of Supervisors regarding the proposed Foundation Protection Program to address foundation damages caused by shrink/swell soils and at that time, the Board had directed County staff to hold community meetings to review the proposed Program and to receive input from citizens. He further stated the Board of Supervisors had met with the Commission on Soils and Foundations on September 22, 1992 and they had submitted their recommendations to the Board; that the County Attorney would present an overview on the recommendations of each proposal and stated the plan which had been recommended to the Board by staff was one in which the County had legal authority to implement at this time. He noted the Board of Supervisors had set the date of October 14, 1992 for public hearings to consider issues regarding shrink/swell soils; that after the public hearings, the Board had the option of taking action to implement any part of or all of the plans or none of the plans; and that one more community meeting would be held on October 5, 1992 at 7:00 p.m. at Hount Pisgah United Hethodist Church. He then introduced Hr. Hicas. Hr. Hicas presented a slide presentation on the history regarding triassic soils, the triassic area and the area now subject to stricter foundation engineered requirements under the new program and stated the potential for shrink/swell soil exists throughout the County. He reviewed the number of inspections and soils tests which had been conducted on individual homes and, specifically, homes located in Woodlake; the number of homes in which foundation cracks had been found and in which additional inspections had been conducted; and the percent of foundation damage attributable to shrink/swell soils. There was citizen comment as to the reason there were not specific numbers available on homes located in Brandermill. -1- Hr. Hicas then reviewed the number of estimated located within the triassic basin; the number of inspections which had been conducted in response to calls received by the hotline; the number of soils tests which had been performed or are being performed County-wide; the estimated number of homes with foundation structural problems attributable to shrink/swell soils; the estimated number of shrink/swell damaged homes without other legal recourse or through HOW insurance; the estimated average cost to repair shrink/swell structural problems; the average number of additional Woodlake residents who would request soils and foundations tests if a repair program existed; and the approximate number of built homes and unbuilt lots within Woodlake. He stated there were significant challenges for the State and significant restraints which limit the means in which government can provide direct relief to citizens using publicly funded dollars and in attempting to develop a plan for relief, the County was focusing on public policies to protect the County's taxbase, to protect the integrity of the County's housing stock, and to promote economic development. He noted at the present time, the County did not have the authority to impose impact fees and there was a legal requirement that the cost to provide a public service could not exceed the cost of actu abil Admi home note comp with homes foundation ally providing that service. He reviewed the County's ity to franchise businesses as recommended in the County nistrator's proposal, the statute of limitations in owners seeking financial recovery from builders and d the proposal by the County Administrator was the most rehensive and only consumer protection program known in the State of Virginia. There was citizen comment and discussion relative to whether federal fraud laws would apply to homeowners experiencing damage from shrink/swell soils. Mr. Micas then reviewed the proposed recommendations for the Program including increasing the building fee for residential construction by $100; adoption of ordinances franchising all residential contractors who build in the County and all realtors or real estate brokers; creation by the County of pre-designed foundation plans and foundation repairs for residential construction in shrink/swell areas in order to reduce costs; and creation of a list of contractors who would perform foundation repairs within an approved pricing system in order to prevent price gouging. Th de re po di th ii in ere was citizen comment and discussion relative to the finition of the "first resale"; whether houses would ceive inspections at the time of each sale; whether it was ssible for inspection reports on the same house to have fferent reports and the party responsible for the cost of e inspection; and whether there would be a County approved st of qualified engineers conducting foundation spections. Mr. Hicas then reviewed the provisions in accessing the the foundation security fund. use Th de so pa co ci fo al co cu pe ere was citizen comment and discussion relative to the finition of cosmetic damage attributable to shrink/swell ils; the requirement to exhaust all other sources of yment such as insurance and litigation; whether the County uld file a class action lawsuit, on behalf of the tizens, against the developers and builders; whether the undation security fund would exclude those who have ready made repairs to their homes; whether homeowners uld apply for eligibility now even if they were not rrently experiencing damage; whether the twenty-five rcent co-payment would be required if it was determined -2- ba pa an ho so p~ p~ob~ems app~2ed e homeowner was not issued a certificate of occupancy; the sis for the requirement of the twenty-five percent co- yment by the homeowner; the maximum stop-loss per house d the limit of the fund; whether the County would certify uses free of damages for mortgage purposes if a technical lution was recommended by the County; whether any ovisions were being made to address these types of in the future; and the $100 application fee being against the co-payment requirement. Hr. Hicas then reviewed the recommendations for performan of soil testing and engineering design by an independe structural engineer for houses determined to have suffer shrink/swell damages and a contribution plan from t development community for those developments within t shrink/swell areas. He stated the proposed Program was o in which the County had legal authority to implement at th time and additional revenue sources could be acquir through General Assembly action. He reviewed reven projections for those homes affected by shrink/swell sol and first year cost for the Program. He then reviewed t differences between the proposals by the Coun Administrator and the Commission on Soils and Foundation a stated each plan recommended the creation funded foundation assistance fund. He recommendations for revenue sources from noting which proposed recommendations would Assembly approval; the recommendation to professional distribution of a publicl reviewed t the Commissi require Gener increase t business licenses for contractors; and t of funds from under each proposal. ce nt ed he he ne is ed ue is he ty nd y- he on al he he There was citizen comment and discussion relative to the first year cost of the Program; why the realtors would be paying a higher percentage than the builders; and the impact the proposed franchising fees would have on homeowners and the County. Hr. Olsen reviewed the survey conducted by the Commission on Soils and Foundations; the number of houses inspected due to calls received by the hotline; the number of houses experiencing structural damage; the number of homes in which statistical analysis were conducted; and the number of houses per district and percentage of houses experiencing damage. He then reviewed the differences between the two proposals such as the Commission not recommending a cap on the use of the fund and methods which needed to be examined in addressing shrink/swell soils. He stated he felt the idea for a foundation protection program or foundation assistance fund was a proactive stand for the County and noted there were no other similar plans currently in existence within the State. There was citizen comment and discussion regarding the differences between the two proposals as they related to structural damage attributable to shrink/swell soils; how the effective date was selected for the proposed plan by the Commission; the existence of shrink/swell soils and conditions being influenced by weather conditions; whether the damage was caused from shrinking rather than swelling in th fe pr an de re th Co fo fo is particular area; problems occurring in other places and t just within the County; whether this issue could be derally investigated; what the total cost the proposed ogram was based upon; the Commission's recommendation for assessment on all undeveloped lots within the County; the finition of shrink/swell soils; the Commission's commendation to initiate a geotechnical study to define e problem, levels and testing; the responsibility of the unty for interpretation of the Building Code; the reason r two reports; the criteria used to determine if a undation has been damaged by shrink/swell soils; and -3- resources available by the County in conducting soils tests upon request. Hr. Bob Karnes stated his house has experienced damages attributable to shrink/swell soils; that he felt there should be a federal investigation of the issue; that there were issues which needed to be addressed and he proceeded to read into the record portions of a document dated April 16, 1974 regarding the environmental relationship of Brandermill to the Reservoir and stated the developer did not conform to the construction of the homes due to the soil conditions in the area and that the report documented the soil conditions were known within the area prior to development. He then read into the record portions of a letter dated April 26, 1974, from the developers of Brandermill regarding soil conditions and types of construction planned and stated the developers of Brandermill were aware the soil conditions existed and the developers had indicated measures would be implemented; that he felt all soils should be tested; and that the soils scientist was aware of the problems prior to development in certain residential communities. He then reviewed a HUD report regarding Brandermill and its soil conditions; that he did not feel the developers and builders would agree to any voluntary plan for funds as recommended in the County proposal; and that the County has been unsuccessful in collecting past fees on building permits from builders. He then reviewed a document dated January 30, 1992 from the current Building Official to a homeowner indicating that prior to November of 1991, builders were not required to submit detailed information regarding soil characteristics and footing designs; that there was not a policy enforced regarding this; that past building permit applications should be on file at the County; and that he was concerned as to the selection of the auditing firm for the Building Inspection Department. Hr. Jim Tripodi stated he has experienced damages to his house attributable to shrink/swell soils and has received assistance; that he formerly resided in Brandermill; that he has received assistance from the Assessor's Office and expressed appreciation; that he had moved to Brandermill in January of 1988; and had purchased his home through the assistance of a real estate agent; that when he noticed some cracks, he was told it was settlement damage; that he had received a report to the property owners from HOW insurance stating there was no major structural damage; that after moving into the house, the cracks had started increasing and he filed a HOW report which was denied; that after a year another report was filed and denied; that he had contacted the builder and the insurance company; that at that time, there was new construction taking place in the neighborhood and he decided to pay for the repairs himself; that when the contractor inspected the home, he received an estimate in the $50-60,000 range; that he then hired his own engineer and proceeded to negotiate with the insurance company; that the engineer's report for the insurance company recommended only one half of the rear portion of the foundation be replaced and his engineer recommended a total foundation replacement; that he continued to pursue the matter through the insurance company and after several months, he was asked to sign a release for the insurance company to make the repairs according to their recommendation and for him to agree not to submit any more claims after repairs were made; that the limit on the insurance policy was the cost of the home; that at that point, he did not proceed with litigation against the insurance company but accepted the terms for payment; that he sold his home to an investor; and that he felt homeowners experiencing problems should contact their senators and request assistance in this matter. He requested the County to work with State and federal -4- legislators to obtain better insurance policies. Hr. Ramsey stated the General Assembly could pass legislation to define language in meeting State standards. Hr. Tripodi then stated he was concerned as to the citizens and industries working together as he felt there were solutions in building safer homes; that it would cost approximately an additional $2,000 to meet greater specifications for foundation footings and he felt builders should be requested to build deeper and better footings; and inquired what the governmental structure could do to have the builders more willing to work with homeowners when homeowners were willing to pay the difference to receive better foundations. Hr. Ramsey stated the County adopted standards last November to require engineered foundations within shrink/swell soil areas and the Commission on Soils and Foundations was recommending standard foundations be built higher than the standards of the State Code for those houses built after November. Hr. Tripodi stated he was concerned as to Code violations not being cited after the statute of limitations was expired and inquired as to the current statutes of limitations and indicated he felt this type of information should be available to homeowners. Hr. Ramsey stated the Commission has recommended documenting Code violations and the County was in the process of implementing that recommendation. Hr. Tripodi inquired why the industry members serving on the Commission on Soils and Foundations were chosen by one Board member rather than the entire Board and what would be done to insure an objective viewpoint would be presented by the Commission. Hr. Warren stated he felt the Commission has been objective investigated the issues very thoroughly, that the Commission was comprised of members including homeowners experiencing soils problems as well as those with specific expertise and he felt the Board had appointed a versatile Commission. He further stated the Commission has worked hard and have identified good recommendations and the ultimate outcome would be decided by the Board of Supervisors. Hr. Tripodi expressed appreciation for the objective viewpoints presented by the Commission and the commitment by Hr. Warren to work with the citizens in resolving this issue. Hr. Warren stated the issue was a pressing one and he felt the Board was attempting to address the concerns expressed. He recognized Delegate John Watkins who was present at the meeting and Hr. Russell Gulley, Planning Commissioner for Clover Hill District. Hr. Bob Neal stated he has resided in Woodlake for the past year; that shortly after he purchased his home, he discovered some cracks in his house and he was one of the sixty-nine homes which the County had inspected; that he had contacted the Building Inspection Department and was informed the statute of limitations had expired; that he experienced problems with his foundation and again called the Building Inspection Department to see if this was a violation of the Building Code; that he felt it was the responsibility of the builder and, therefore, he contacted an attorney and was informed he could not recover attorney -5- fees; that he felt legislation should be changed to correct this problem; and the responsible parties should pay the costs rather than the homeowner; that at this point in time, those homeowners who have filed lawsuits against their builders have been awarded damages but could not afford to make the repairs because they then had to pay the attorney fees; and that he felt the developer and the builder should be liable for these repairs. Hr. Pat Dolby stated he resided on Sutter's Hill Road; that he has had the chimney on his house replaced but it still had three major cracks; that he filed a lawsuit against the builder but was informed he could not recover attorney fees for foundation repairs; that after he filed the lawsuit, the builder had filed bankruptcy; that he had received estimates ranging from $16,000 to $64,000; that they were not aware of any recourse they had and could not refinance or sell the house until the repairs were made; and inquired if they made a full disclosure to a buyer, could they sell their home as they felt at this point in time they should invest in a new home. Hr. Hicas advised if a full disclosure was made to the buyer, he could sell his house. An unidentified citizen stated he felt although he could sell the house, the mortgage companies would not want to make loans and it would be harder to sell houses with these types of problems even with a disclosure and the County should address methods of protection for homeowners for the future. Hr. Olsen stated he had discussed these types of situations with the Richmond Hortgage Association and had requested assistance from them in restructuring existing loans and providing low interest loans or grants to citizens to assist in repairing the homes. He further stated the Association had indicated they did not feel the damages were a significant problem at this point in time. He indicated he felt it would be difficult to reach a conclusion to the issue until all involved parties realized there were problems which needed solutions and he was also concerned about foreclosures and felt citizens needed to make the lending institutions more aware of the problems being experienced. An unidentified citizen stated he felt this problem was a County-wide issue and there would be repercussions for those wishing to sell their homes in the future even if they were not experiencing problems related shrink/swell soils. Hr. Tripodi stated he felt citizens needed the cooperation of the appraisal industry as well as the banking industry. An unidentified citizen stated the lending institutions would not want to assist homeowners with refinancing their homes because the appraiser when making its report to the lending institution would document the damages and then the lending institution would request an engineering report and the process would become more complicated. Hr. Ron Clair stated he resided in Brandermill; that his home was experiencing cracking and the problem was worsening; that he felt the County needed to take immediate corrective action; and that he felt those who did repair their homes, would be penalized when selling their homes because they did take corrective action and felt that issue needed to be addressed as well. Hr. Olsen stated the Commission's proposal addressed that -6- particular concern and expressed if documentation was provided, the cost would be recoverable. An unidentified citizen stated she felt a vote should be taken of those present to see if the citizens agreed they should have an opportunity to recover the costs of what they have already spent to repair their homes. A showing of hands of those present indicated the majority was in agreement for those who had already repaired their homes to recover the costs. Hr. Warren inquired how many citizens were in favor of a cap on the amount the homeowner could recover. It was indicated by a showing of hands that those present were not in agreement with the proposed cap. Hr. Warren inquired how many citizens felt the responsibility was the buyer's and the County should do nothing. It was indicated by a showing of hands that those present felt the County should be held responsible. Hr. Olsen inquired how many citizens were in favor of the creation of a tax district in the triassic basin with the increase in taxes being used to fund the proposed Program. It was indicated by a showing of hands that those present were opposed to the creation of a tax district. An unidentified citizen stated he felt it was the responsibility of the developer, the builder and the County; that litigation should be taken against the developer and the builder with the remainder of the responsibility being the County; that the County should be responsible for anything that could not be recovered and he did not feel the real estate industry should be responsible for the repairs; and that it was a County-wide problem and the solution should be in the best interest of the entire County. Hr. Warren inquired how many citizens felt the County should raise taxes to fund the solution. It was indicated by a showing of hands that approximately fifty percent of those present felt taxes should be raised if other solutions could not be found. Hr. Warren stated the County was comprised of five districts and not all of the districts were experiencing the same problems and, therefore, opinions may vary throughout the County. Hr. Walt Harms stated he resided in Burnham Woods and inquired whether the County felt they were responsible for part of the problem. Hr. Warren stated he felt every entity involved in the process should bear part of the responsibility, that the County felt a responsibility and was attempting to address the issue and that the process they were following would assist the County in reaching an equitable solution individually and collectively. Hr. Harms inquired if the County felt partly responsible for the problems occurring, why the proposed solution did not include any funding from the County. Hr. Warren stated at this point in the time, the County has not made the decision regarding the funding and would be addressing all available options at the public hearings scheduled to be held by the Board of Supervisors at its regularly scheduled meeting on October 14, 1992. Hs. Linda HcCathry stated she has resided in the County for -7- thirty-five years and has been a real estate agent for the past fifteen years; that she was opposed to the $100 fee in franchising all realtors and real estate brokers; that she did not feel it was the responsibility of the real estate industry; and inquired why the County could not impose any fees on the developers and the builders. Hr. Hicas stated the County was aggressively pursuing legal action against the developers and there were significant restraints to localities in addressing these types of issues. There was brief citizen comment relative to the County taking legal action against the developers. Hr. Warren stated the recommendations in the County' s proposal were based on current authority of the County and the County was addressing methods such as changing laws to prevent these types of situations from occurring in the future. Hr. Olsen stated he felt the concerns expressed by the realtors were valid up to a point; that not every realtor, builder and developer was dishonest; that he had recently contacted a realtor within the County over a concern in a subdivision; that the prospective buyer had requested not to be shown homes in Woodlake or Brandermill because of the shrink/swell soil problems and so were unaware of any problems in other subdivisions; that the buyer placed a sales contract on a home in a different subdivision and after meeting some of the neighbors was informed there were problems in the neighborhood; that the prospective buyer tried to get out of the contract but the realtor would not let them out of the deal; that he had attempted to speak to the realtor, on behalf of the buyer, but they would still not let the prospective buyer out of the contract; that he felt there were still individuals in the real estate industry who were attempting to minimize the problems and were not accepting responsibility. An unidentified citizen stated he was a realtor and resided within the County; that he has experienced problems relating to shrink/swell soils; that he felt the County was trying to assess all realtors in the area and a majority of realtors would probably stop selling in the County; that the industry's income has already been negatively impacted and he did not feel it was fair to assess the real estate industry a fee. Hr. Tripodi stated he felt citizens should contact the County Assessor's Office and request a reassessment on the houses experiencing damage. There was citizen comment and discussion regarding the process in requesting a reassessment. Hr. Don Stockert stated he resided in Turtle Hill; that he felt damages attributable to shrink/swell soils should be the responsibility of the builder, the developer and the County and citizens should file class action lawsuits or take other means for the development of a fund to be used to repair the homes and after the responsible parties made restitution, he felt the remaining balance of any necessary funds should be levied. An unidentified citizen stated he resided in Woodlake and inquired about the requirement that a homeowner must apply for eligibility within twelve months of the start of the Program. -8- Hr. Ramsey stated the purpose of the County's recommendation was to identify all current problems for corrective action and noted the Commission had made a different recommendation regarding eligibility. An unidentified citizen stated he was concerned as to the requirement for eligibility and the impact it would have on those who may experience problems in the future and inquired if the County's proposal included recommendations to address these type of situations which may occur after the twelve month period. Hr. Ramsey stated the County's recommended plan was not aimed at being a continuing program. An unidentified citizen stated he felt a grand jury investigation should be conducted. Hr. Jim Napier stated he was a real estate broker within the County; that he felt the County, the developers and the builders were aware the problems existed and inquired why fifty percent of the proposed funding recommended was to be generated by the fee imposed on the real estate industry; that the issue was negatively impacting all homeowners within the County; that he was a homeowner within the County and he felt it was the County's responsibility; that he felt the proposed fee regarding the relators was unwarranted and unfair; that he was addressing this issue as a homeowner and not on behalf of the real estate industry; that there were responsible builders; that the media and, specifically, the newspaper was misrepresenting the issue; and that the issue of shrink/swell soils should be addressed and corrective action taken for those experiencing problems. He further stated he felt the incident cited by Hr. Olsen regarding the real estate industry were unfair as the engineering reports he was addressing conflicted and the house in question had not exhibited any problems. Hr. Harry Lett stated he owned two homes experiencing problems; that he felt the problem has been in existence for a long period of time and certain individuals were aware the problems existed; that he felt the estimates were probably going to be higher than anticipated; that the proposal by the County was too restrictive such as the eligibility requirement and he would be more in favor of the proposal by the Commission on Soils and Foundation; that the issue was how to pay for the problem and if the homes were not repaired, every resident of the County would suffer; and that the expense to repair the homes should be spread over the entire County after first attempting to collect from those individuals who are responsible for the problem. Hr. James Knight stated he resided in Sutter's Hill; that he was experiencing problems with his home; that he felt the builder should be held responsible and he was concerned as to how the cost of the repairs would be funded; that he could not afford to repair his home; and that the problems were negatively impacting the welfare of the entire County. Hs. Alice Schultz stated she has resided in Woodlake for less than one year; that she felt it was her obligation as a citizen to address the issue; that she was not currently experiencing any problems but was concerned as to whether she may experience problems in the future; that the laws governing the system were unfair; that she had purchased her home in good faith and she felt she had a right to believe in the integrity of the builder; and that she was very concerned about the problems and how it would impact those experiencing problems in the future. -9- Hr. Wayne Appleton stated he was a realtor within the County and was opposed to the recommended County proposal; that he represented a responsible realty company who had also built homes; that he felt those experiencing problems, needed a solution; that the problem was negatively impacting the entire County and he felt the County should be responsible since the Building Code was not properly enforced; that once a fee was imposed, it would remain in existence forever; that the solution should be clearly defined and the media has created a lot of confusion; and that he would like the issue resolved with the approach addressing those responsible. An unidentified citizen stated she has been a resident of the County since the mid 1960's; that she was not experiencing any problems at this time; that she was opposed to both of the proposals; that she felt the developer and the builder should be held responsible and the County should legally pursue all interests necessary in assessing those individuals responsible. Hs. Harcia Phelon stated she has resided in Woodlake for the past two years; that she felt the Richmond Times Dispatch has done the County a service; that the current Board of Supervisors was not responsible for creating the problem and were trying to assist the homeowners; that the developers were aware of the existing soil conditions and should be held more responsible than the builder; and inquired if the Board of Supervisors had the authority to request a grand jury investigation. Hr. Hicas stated a grand jury investigation could be requested by the Board of Supervisors. Hs. Phelon then stated she felt the realtors, the developers and the builders should be held responsible for the repairs and the County should assist the citizens by requesting a grand jury investigation and homes purchased within the County should be supported by the Board of Supervisors so citizens could feel proud to live in Chesterfield County. Hr. Perry Owen stated he resided in Woodlake and he was not currently experiencing any problems but was concerned for those who may not experience problems until later in time. Hr. Olsen stated the Commission did not recommend a time limit for eligibility. Hr. Warren inquired how many citizens supported the Commission' s recommendation for eligibility. It was indicated by a showing of hands that the majority of those present supported the recommendation by the Commission for eligibility. Hr. Dan Lockhart stated he has resided in Woodlake for the past year and one half and was a real estate agent; that he was concerned as to the real estate industry being held responsible; that real estate agents are currently held accountable for what is represented to the public; and are not protected in the same manner as builders; and that he felt those parties responsible should be held accountable and not the real estate industry. An unidentified citizen stated he was concerned as to the criteria which would be used to determine damages being attributable to shrink/swell soils and indicated he felt all damages should fall under the proposal even if attributable to violations of the Building Code or poor construction. No one else came forward to speak about this issue. -10- Hr. Warren expressed appreciation to Delegate Watkins for attending the meeting and encouraged all citizens to attend the other public meetings scheduled. He further stated public hearings had been scheduled for the Board meeting on October 14, 1992 at 7:00 p.m. and correspondence could be mailed to members of the Board of Supervisors, the Legislative Delegation and State senators. Hr. Ramsey stated the County was pursuing all legal recourse against the developers and the builders, however, since the statute of limitations has expired, the County was restricted. He further stated the request for a grand jury investigation was under the purview of the Board of Supervisors, that the County was limited in using tax dollars for making repairs to private property, and that the County had legal authority to implement the proposal recommended by the Administration at this time. Hr. Warren expressed appreciation to all for their input and participation into the process. Lane B. Ramsey County Administrator -11-