Provinces asking feds for $138 million to help buy out flooded properties

By Jordan Press

THE CANADIAN PRESS

OTTAWA _ Flood-ravaged provinces are asking the federal government to provide almost $138 million to move or buy out homeowners affected by previous years’ inundations, according to new data that gives a glimpse into the national costs of helping residents leave floodplains.

Calculations based on previous experience suggest that the total cost of giving up on 100,000 of the most endangered structures could run into the billions.

Only four times in the past decade have provinces turned to the federal treasury for help to move homes twice in New Brunswick, and once each in Quebec and Yukon.

In New Brunswick’s case, the federal government picked up more than 80 per cent of the $1.8 million spent to buy out a combined 36 properties after flooding in 2008 and 2010.

Public Safety Canada says provinces and territories have asked for $137.9 million in federal money to help cover costs related to 10 floods, but the dollar figure is only an estimate and doesn’t include this year’s.

The department says it expects to get more requests for financial help to relocate homes as the frequency of extreme flooding increases and wants to know how much provinces and territories have spent on it without federal help.

All that data will feed into a debate governments are having about whether it’s better to move people off floodplains rather than repeatedly pay for repairs.

Federal help for disaster relief kicks in once costs surpass what lower levels of government could reasonably be expected to cover on their own.

Within the program, called the “Disaster Financial Assistance Arrangements,” is a provision that allows provinces to claim the cost of relocating residents to areas less prone to floods or other disasters. Federal funding can also be used to buy out affected homeowners and dismantle damaged buildings.

How much gets doled out depends on the design of the buyout program, which has become a point in discussions between Public Safety Minister Ralph Goodale and his provincial and territorial counterparts.

A program could provide money up to a pre-set maximum, which is what Quebec’s government is offering this year up to $200,000 to anyone with severe damage to their homes. Or it could pay the full estimated value of a home before it was flooded, as Alberta did after flooding there in 2013.

In that case, about one-third of homeowners who were offered buyouts took them within a year of the offer, costing the province $81 million in 2014. Alberta covered the bill itself, without federal assistance.

Based on the data available, the federal government has paid, on average, about $41,000 for each property owner who accepted previous buyouts in New Brunswick.

This year, New Brunswick is offering up to $160,000 for each home where damage exceeds 80 per cent of its pre-flood value. Owners can sell their buildings and have them demolished and levelled but retain their land. They can also sell out entirely, or take up to $160,000 to use on repairs in exchange for giving up any future disaster aid.

The Insurance Bureau of Canada estimates about 100,000 homes out of the 14 million dwellings Statistics Canada counted in the 2016 census _ are at the highest risk of repeat flood damage. A buyout program for those properties could cost the federal treasury hundreds of millions of dollars based on the limited information available about previous federal disaster help, in addition to what provincial governments put up.

“No government bailout program or insurance program is going to be able to deal with those repeated cases where you’re going to have repeated claims in a short period of time. That’s where you may focus buyouts,” said Craig Stewart, vice-president of federal affairs with the Insurance Bureau of Canada.

“In our view, the calculation is buy out a few and then protect and insure the rest.”

Ontario creating task force to improve flooding resilience

TORONTO _ Ontario is creating a task force on improving the province’s resilience to flooding, following high water levels this spring in several communities.

Premier Doug Ford and Natural Resources Minister John Yakabuski said in a statement that the government will work to better plan for and reduce the impacts of flooding.

“Over the past couple of weeks, we have seen first-hand the devastating effect of flooding on our communities,” they said in the statement Friday. “The people of Ontario can’t go through this every year. Something needs to change.”

The task force will consult with municipalities, including in the Muskoka region, Pembroke and the Ottawa Valley.

Ontario has activated a disaster recovery assistance program for residents in Bracebridge, Huntsville, Pembroke, Renfrew County, Ottawa, Clarence-Rockland, Champlain and Alfred and Plantagenet.

The program helps cover emergency expenses and the costs to repair or replace essential property not covered by insurance after a natural disaster.

The task force announcement comes not long after the Progressive Conservative government cut conservation authorities’ funding for flood management in half.

Conservation authorities forecast flooding and issue warnings, monitor stream flow, regulate development activities in flood plains, educate the public about flooding and protect natural cover that helps reduce the impacts of flooding.

Ontario had given $7.4 million to the conservation authorities for that work, but they say that has now been reduced by 50 per cent.

Yakabuski has said the government is trying to eliminate the deficit _ currently at $11.7 billion and has asked conservation authorities to focus on their core mandate, which includes flood control.

NDP environment critic Ian Arthur said the task force should start by reversing those cuts.

“Any review of flood management in Ontario should begin with undoing the damage done by the (Doug) Ford Conservatives,” Arthur said in a statement.

First your home is flooded – then you lose your mortgage?

By  | Global News

When flooding ravaged parts of southern Alberta in 2013, banks and other lenders took notice.

“We would be asked on every deal, ‘Is it in the flood zone?’” Mike Boyle, president of Calgary-based The Mortgage Group, told Global News.

Lenders didn’t want to get involved with addresses that turned out to be in the disaster areas, he recalled.

Six years later, with the flood a “distant memory,” that’s no longer an issue, according to Boyle. But he worries about homeowners in regions like southeastern Ontario and Quebec, where rivers seem to be overflowing with alarming regularity.

“You can’t get a mortgage if you can’t get insurance,” he said.

Speaking from the Ottawa-Gatineau area, which is experiencing its second major flood in the span of 24 months, licensed insolvency trustee John Haralovich shares the same concern.

“We have seen lenders not agree to renew the mortgage,” said Haralovich, a senior vice-president at debt consultancy firm MNP.

Those have been rare cases so far, he said, but that could change.

“In 2017, they said (the flood) was a once-in-100-year occurrence, and two years later, it’s happened again,” he said.

Homeowners who discover they can’t continue their insurance coverage may also hear from banks that they won’t keep servicing their mortgage once it comes up for renewal, he added. With no insurance to protect the collateral, mortgages on homes in flood-prone areas may become too risky for mainstream lenders, he said.

Several experts who spoke to Global News are concerned that a growing number of Canadians may find themselves facing this issue after the latest round of spring flooding.

READ MORE HERE: 

Flood insurance difficult to obtain for homeowners at repeated risk

By Jonathan Forani, CTVNews.ca

More Canadians have flood insurance than ever, but homeowners at repeated risk still face the most difficulty obtaining coverage, according to lobbyists.

Insurance for “overland flooding,” from rising water levels rather than sewer backups or roof seepage, has only been offered by insurers across the country since 2015. Now, about a third of Canadians have it, according to Craig Stewart of the Insurance Bureau of Canada.

But homeowners in high-risk flood zones who may require repeated claims have limited options.

“Presently there really is not affordable high-risk insurance available for those that are going to be at repeated risk of flooding,” said Stewart in an interview with CTV’s Your Morning. Stewart, who leads a task force of insurers, realtors and local governments, presented recommendations to ministers earlier this year on how to protect high-risk homeowners.

“For those that are at repeated risk, we are recommending to governments that they take a hard look at strategic retreat, getting those people out of harm’s way,” he said.

Any official final solution based off the task force recommendations is likely a year away, he added. Until then, homeowners facing repeated risk of flooding have few options, as their needs would have to be subsidized by taxpayers or other policy holders, he said.

Some homeowners in that group have taken “drastic” measures to avoid risk, he said, such as putting their homes on stilts. Stewart recommends it.

“Or you just absolutely reduce your risk by either moving or just making sure you’re taking everything out of your low lying area or your basement that’s going to reduce any future claim,” he said.

According to a 2017 report by the Munk School of Global Affairs, flood-related losses have surpassed fire and theft as the primary source of property insurance claims. Despite increasing claims, a lot of Canadians aren’t even aware they live in a floodplain until they get flooded, said Stewart.

“Canadians first and foremost should understand what their risk level is,” he said.

Most flood victims will need to rely on gov’t compensation

CTV Montreal

Most flood victims will have to rely on the government for compensation and not their insurance companies, according to the Insurance Bureau of Canada.

Only 30% of Quebecers have the kind of flood insurance introduced in Quebec in 2017 that will qualify them for compensation – many didn’t qualify, didn’t think they’d need it, or decided the premiums were too hefty.

“If they were flooded and they don’t have the flood endorsement in their home policy then their option is to file a claim with the government for financial assistance,” said Pierre Babinsky of the Insurance Bureau of Canada.

Flood victim Mark Zousmin has the insurance, and is dealing with his second flood in three years.

“Before the flood of 2017, I paid approximately $700 – 800 per year and after, they increased it to almost $1,500. I like this area but if they consider it in a flood zone and everybody is supposed to move, I will have no choice,” he said.

The provincial government said it’s working to improve the compensation process, announcing Wednesday a minister’s ‘action group,’ so flood victims get money faster and look toward the future.

“What’s been simplified is that people can know faster how much money they are entitled to receive and they can get this money faster,” said Public Security Minister Genevieve Guilbault.

Those going through it now say so far, it’s the same story as two years ago.

“The insurance companies say call the city, the city says call the government,” said flood victim Serge Lafleur. “In the end, it’s us that have to pay.”

The Insurance Bureau of Canada said it’s working with the federal government to create a funding program to help flood victims.

Quebec flooding: Exhaustion, frustration among Ste-Marthe residents

STE-MARTHE-SUR-LE-LAC, Que. Darlene Ratelle says it feels like she’s trapped in a nightmare.

Her mobile home is submerged, her husband — who has multiple sclerosis — is in long-term care, and even when the floodwater recedes, she probably won’t be able to sleep in her own bed for months.

“If this is a bad dream, I’m anxious to wake up,” said Ratelle. “I don’t know if my home is a total loss, my partner can’t help me and I’m probably going to have to start all over. Which isn’t easy at my age.”

Like dozens of her neighbours in the trailer park, Ratelle waited in line Tuesday morning until police could ferry her home to pick up a few personal effects.

“I’ve got five minutes, so I’ll grab the most important documents and get out,” said Ratelle, who is living with friends for now. “It’s exhausting. Maybe my luck will turn and I’ll win the lottery.”

Following Saturday’s dike breach in Ste-Marthe-sur-le-Lac , which sent water gushing into 2,500 homes, first responders have largely contained the damage. From Monday, the military and city wrapped up nearly 36 hours of continuous work to build two emergency flood walls in the town.

But people living in the low-lying trailer park are not protected by either structure. What’s worse, Ratelle says, is that the town appears to have been aware the dike needed major repairs as early as 10 years ago.

On Tuesday, Public Security Minister Geneviève Guilbault confirmed reports that the town had been aware of damage to the dike since 2009. Mayor Sonia Paulus had put in a request for a study and modernization of Ste-Marthe’s 3.5 kilometres of dikes in 2015, but the work was only set to begin next fall.

Ratelle said the town acted negligently and that she’s willing to join a class-action lawsuit.

“I’m insured for $10,000 against rising water,” she said. “But does it even apply here, and would they pay out? I don’t know — the contract isn’t clear on that. And even if they pay out, $10,000 won’t go far.”

Danielle Fortin’s house is also under water, but she can’t bring herself to think about lawsuits or repair costs.

“It’s just material possessions — no one is dead,” said Fortin, who was boarding a dinghy to her home. “It could have happened in the middle of the night, and then God only knows how bad it would have been.”

Fortin has arranged to stay in an apartment that her friend usually rents out to travellers. She can live there, free of charge, until mid-June.

“After that we’ll probably have to find an apartment, because we won’t be back here for months,” she said. “I spoke to my insurance provider, and they told me to file a claim. But I live in a flood zone. No insurance covers that.”

Lyne Gervais, who moved to Ste-Marthe last year, says she planned on retiring in the trailer park. She’s not sure if that’s possible anymore.

“I’m frustrated, very frustrated with the city. They knew about this for 10 years and did nothing,” Gervais said. “Insurance won’t cover an act of God, but this is no act of God. It’s human error. The dike failed.”

Gervais said she would strongly consider joining a class-action lawsuit against the town.

People around the park ran the gamut of emotions Tuesday; some shared dark humour, interspersed with bouts of crying. Others simply looked exhausted.

By late afternoon, most of the thousands of residents whose homes remain flooded will have been allowed back for a few minutes. Some, whose homes were merely evacuated as a precaution, were allowed back on Monday night.

After visiting their homes, people stepped off the police rafts with little more than a few garbage bags full of clothing. Some wept at the site of the damage.

Michel Labelle worked for Ste-Marthe more than 40 years ago, when it was a cottage town of just a few thousand.

“Before they built the dikes in ‘76, flooding was a yearly occurrence,” said Labelle. “I used to take the chief of police on my tractor and we’d pick up the schoolchildren and drive them through the flood zone to their bus stop.

“The dikes changed this city — made it much more livable.”

Hydro-Québec crews are restoring power to the houses untouched by the floods while avoiding those still under water.

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