Lawmakers look to assist homeowners with crumbling foundations

HARTFORD >> Regional officials and lawmakers from eastern Connecticut want to make sure the General Assembly acts this year to help homeowners with crumbling foundations.

But time is short. The legislative session ends on June 7 and there’s several pieces of legislation, but none of them are considered the “final product.”

There are 38 towns impacted by the problem, which involves a mineral known as pyrrhotite. The mineral used in the concrete aggregate for these foundations is now crumbling.

The Office of Fiscal Analysis says that over the next 15 years affected municipalities could lose about $40 million to $80 million in revenue. That’s based on a $2,000 to $4,000 loss in property tax revenue per home. It estimates that 20,000 homes could be impacted, while other groups say it’s closer to 30,000 homes.

As of December 2017 only 567 homeowners had reported the issue to the Department of Consumer Protection.

Homeowners have been hesitant to come forward because the problem could mean their home is worthless and many don’t have the $150,000 to $200,000 it would take to replace the foundation. Repairing it is not an option.

The state Bond Commission approved $5 million in bonding on Feb. 1 to help homeowners cover the cost of testing their homes. Under the program run by the Capitol Region Council of Governments homeowners will be eligible for a 50-percent reimbursement — up to $2,000 — for the testing of two core samples within their home. Homeowners who have visual testing conducted by a licensed professional engineer will be eligible for a 100 percent reimbursement — up to $400.

The program will provide support for testing for applicants with homes built since 1983 and that are within a 20-mile radius of the J.J. Mottes Concrete Company in Stafford Springs.

But that’s not a solution to the larger problem.

If homeowners don’t receive the relief they need, they could walk away from their homes and that “could have dire consequences to the banking industry in our state,” Rep. Tom Delnicki, RSouth Windsor, said. “When I say the state, I mean the entire state because banks tend to sell their mortgages back and forth to different institutions.”

He said the legislature needs to take some action on this.

“We need to get the ball rolling,” Delnicki said. “... homeowners will not report unless they see a light at the end of the tunnel.”

Sen. Tony Guglielmo, RStafford Springs, said he’s pretty optimistic they will get something out this session.

He said the executive and legislative branch are involved in the issue and are looking to get something over the finish line.

“I think there will be contributions from the insurance industry, banking, and home builders,” he added. “We’ll some up with a cohesive, comprehensive first step.”

He said the bad news about the situation is that it’s huge and covers 38 towns. At the same time, the good news about the situation politically is that it covers 38 towns.

“If we walk out here and we don’t have something done on this problem it would be shameful,” Guglielmo said.

Legislators have proposed a $12 surcharge on certain property insurance policies in the state that would go into a state assistance fund. They’ve also pitched allowing municipalities to establish a program to provide grants to eligible homeowners to repair or replace faulty or failing concrete foundations and to fund a program that would assist homeowners with the costs by issuing bonds and accepting donations. Another bill currently on the House calendar would require the Department of Consumer Protection Commissioner to adopt regulations regarding the testing and sale of aggregates.

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