Eugene Scolerio bought his Victorian-style rowhouse on the corner of Avenue X and East 19th Street in Sheepshead Bay, Brooklyn, in 1965, paying $31,000. Now, even though the waters from Superstorm Sandy never got closer than Avenue Y a block away, he may have to spend hundreds or even thousands of dollars a year for federal flood insurance.
“I’ve been here 48 years, and this has never happened before, and now they want me to pay for it,” the 73-year-old said. “It’s just another tax.”
Mr. Scolerio is one of more than 35,000 property owners in the city struggling to deal with the myriad consequences of waking up last Tuesday morning to find their homes and businesses included in a hugely expanded flood zone on maps released by the Federal Emergency Management Agency. The new maps doubled the number of properties in the flood zone. Tens of thousands more will likely be added when FEMA releases its maps for northern Brooklyn and Queens, western Staten Island, the Bronx and Manhattan at the end of the month.
Landowners are now facing diminished property values at the same time that the costs of owning a home or business in these areas will rise—a result of higher insurance rates and stricter rebuilding requirements. They may also have a harder time securing a mortgage, as could potential buyers of their homes.
“There’s a space on the appraisal form for FEMA flood zones, and [filling that in] could be a real red flag,” said Jonathan Miller, chief executive at Miller Samuel, a leading appraiser. Homes that weeks ago would not have been labeled as being inside the federal floodplain now are, and Mr. Miller said this could give lenders a reason to deny people mortgages.
Sheepshead Bay is one of a number of neighborhoods where hundreds of blocks have been added to flood-zone maps that formerly showed only a handful of them. On the corner of one of those blocks, at Avenue Z and Sheepshead Bay Road, the area’s main shopping strip, stands the Tête-à-Tête Café, where a mix of Russian and American pop music plays on a stereo.
Owner Arkady Nadelson said his six-year-old establishment was closed for two months as a result of Sandy’s flooding. He puts his losses in spoiled food alone at $15,000. Now his landlord is facing a huge increase for flood insurance—a cost that Mr. Nadelson fears will be passed on to him.
“And then I have to raise my prices, and my customers, who have to pay to fix their own homes, can’t afford it,” Mr. Nadelson said. “It’s bad.”
For Sheila Gitlin, a real estate agent for the Fillmore Real Estate office on Avenue U nearby, the problem is the two rental properties she owns on a block of Emmons Avenue that is now on the new FEMA map.
“Because I’m a landlord, not a resident, I’m [ineligible] for FEMA insurance, and now I don’t know who will insure me since I’m over the line,” she said. As a result, she said, she might be forced to sell, but there, too, the news is bad. “I don’t even think it would be worth what I could have gotten last week, before these maps,” she said. Zoning gets waived
Last week, property owners in Sheepshead Bay and elsewhere got one bit of good news, when the Bloomberg administration moved to address some of the uncertainties that the expanded flood zones had created for property owners. It issued an executive order suspending certain zoning restrictions, such as building heights, which might hinder property owners in their rebuilding efforts as they try to negotiate conflicting demands between local and federal regulations.
NYC Planning Commission Chair Amanda Burden made it clear what the administration hopes to accomplish with the new rules.
“Homeowners need to be able to rebuild to sound flood-protection standards without facing conflicts with current zoning regulations,” she said. “This limited and targeted suspension of zoning regulations in the flood zones … will help ensure that new and rebuilt homes and businesses and other buildings will be safeguarded from coastal floodwaters.”
Strict height limits incorporated in zoning in many low-lying areas of the city, for instance, would effectively bar homeowners from raising their first floors to put them above the potential flooding. Thanks to the executive order, that will not be the case.