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NY Rising OKs deals on 155 LI storm-hit homes for $59.5 million

Susan Gorman shows how high the water reached

Susan Gorman shows how high the water reached during superstorm Sandy while standing on the porch of her former home in Lindenhurst on Wednesday, Sept. 17, 2014. Credit: Steve Pfost

New York State has accelerated the pace of buying properties severely damaged in superstorm Sandy and tropical storms Irene and Lee, closing deals on 155 Long Island homes that it valued at $59.5 million, new figures show.

New York Rising, the state agency administering $4.4 billion in federal funds for storm-related recovery, had purchased 97 properties in Suffolk and 58 in Nassau by Wednesday and now is averaging about 30 closings each month across Long Island, officials said.

The state program had made "conditional offers" on a total of 713 homes across both counties, with a cumulative worth the agency put at $300.9 million, from 958 applications, the figures show. The deadline to apply was April 11.

The latest tally represents a dramatic increase in acquisitions and buyouts ahead of the two-year anniversary of Sandy -- the horrific Oct. 29, 2012, storm that flooded homes, ripped up boardwalks and battered shorelines along the Eastern Seaboard from Florida to Maine, causing billions of dollars in damage.

The homes fall into two broad categories: acquisitions, or properties that will be redeveloped to be storm-resistant; and buyouts, homes that will be demolished, with the land repurposed as environmental buffers against future storms, according to NY Rising spokeswoman Barbara Brancaccio.

NY Rising, the agency created to administer billions in Community Development Block Grant funds from the U.S. Department of Housing and Urban Development for storm recovery, has come under sharp criticism from stricken homeowners and some local officials for hefty delays in handling cases and providing money for repair, reconstruction or demolition.


Buyouts and assistance

The agency is responsible for delivering relief through four programs: housing recovery, which consists of buying distressed properties; small-business assistance to help get firms back on their feet; community reconstruction, a program that allows neighborhoods to plan their future; and infrastructure assistance, financial help for much-needed capital projects.

NY Rising, in the first raft of deals on storm-damaged properties, had closed on 34 of these 155 homes on the Island by May. Sixteen of those were acquisitions, and 18 were buyouts. At that time, the agency had made conditional offers on a total of 470 homes.

To be considered for acquisition or buyout, the homes had to be declared "substantially damaged," a key designation meaning the property sustained damage of 50 percent or more of its pre-storm market value.

The state's latest figures provide the first broad look into the scope of Sandy's potential effect on Long Island's landscape. Some highlights:

Acquisitions. The state so far paid nearly $23 million to acquire 58 homes in Nassau and $20.5 million to acquire 51 homes in Suffolk.

Buyouts. NY Rising paid $16 million to purchase 46 homes in Suffolk under the buyout program. Buyouts were not offered in Nassau because storm-affected residents did not express interest in the program.

Remaining offers. In Nassau, 224 conditional offers from NY Rising for acquisitions remained outstanding, while that number in Suffolk was 213. The number of pending conditional offers for buyouts in Suffolk was 121.

Number of applicants. In all, 384 property owners in Nassau applied to NY Rising for acquisition of their homes at pre-storm values, while 381 homeowners in Suffolk applied for acquisition. There were 193 applications for buyouts in Suffolk.

Communities with most offers. Lindenhurst, Mastic Beach and Babylon were the Suffolk communities with the greatest number of NY Rising offers for acquisitions and buyouts. In Nassau, Island Park and Long Beach had the highest number of offers for acquisitions.


Abandoned homes

Several state-purchased properties along Lindenhurst's canals, shown to Newsday in a recent tour with NY Rising officials, are sandwiched between others whose owners have decided to stay put despite any storm damage to their homes. The homes are built of brick or wood, some shingled and some with siding, but all are abandoned shells, awaiting demolition or elevation and reconstruction.

Whatever the parcels become -- new housing or natural terrain -- these transformed spaces, and others like them in the hardest-hit communities, will perhaps be the most enduring signs of Sandy's wrath.

Officials pledged that properties purchased as acquisitions will be redeveloped to help rebuild communities through replacement with fortified structures.

"Within a year, we will auction off these properties with new construction," said Rebecca Sinclair, director of buyouts and acquisitions for NY Rising.


Memories of a lifetime

Longtime Lindenhurst resident Susan Gorman, 59, is among those whose homes were purchased as acquisitions, meaning that the parcel can be redeveloped. She called the sale "bittersweet" because the two-story house on South Wellwood Avenue holds 35 years' worth of life's milestones with her late husband and the births, graduations and marriages of their daughters.

She got an offer in April, closed this month, and has begun moving on. She now lives with her mother in North Bellmore.

"They were giving me a very fair offer, so I thought it's probably my best bet," Gorman said. "The streets here are still flooding, and next time I may not be able to get out."

Gorman said that at first, like many storm victims, she had hoped to rebuild her home. But she became worried when months of waiting turned into a year.

Besides, she said, NY Rising had offered her too little money -- only $12,000, after an insurance payout was deducted -- to pay for repair and the required elevation of homes that lie within the 100-year floodplain, areas most prone to massive flooding. So she opted to sell.

State records show properties in Lindenhurst were most frequently on NY Rising's list of properties for potential acquisition or buyout -- 167 people applied for acquisitions, 121 of them received offers from the state and 20 of those deals have closed. In addition, 83 homeowners there -- including those in the areas of Strong's Creek and Venetian Shores, which NY Rising listed separately in data supplied to Newsday -- applied for buyouts, with 73 receiving conditional offers and 19 closings so far.

Charles Farris, 62, an information technology contractor, took a buyout, selling his Lindenhurst home of 20 years. He said he got an offer from NY Rising in March and closed the deal in July.

Sandy had pumped 27 inches of water into the house, elbowed it off its foundation and caused enough damage to make it buyout-eligible. Farris said he at first planned to opt for reconstruction and be inside a newly minted abode in three months.

But the costs of elevating the house and repairing it were too great. NY Rising offered what he called a "fair" price -- $440,000, the cost the agency was willing to pay, plus a 10 percent incentive that is part of the buyout initiative.

Farris, single since his wife died shortly before the storm, and burdened with paying for the mortgage and an equity loan on one salary, said it gradually dawned on him that it was best to get out.

NY Rising's offer, while nowhere near the house's 2007 appraised value of $525,000, was just enough to cement his decision, he said.

"I have very mixed feelings about no longer living there," said Farris, who now lives upstate in Webster, near Rochester. "From the financial aspects I am relieved, but from the emotional aspect I would love nothing more than to have stayed in my home."

He said his experience with NY Rising "couldn't be better," adding that he had a caseworker who always responded to requests within a day, but usually within hours. He never was beset with the delays and lost paperwork that have marred the experiences of other families dealing with the agency, he said.

Suffolk Legis. Kate M. Browning (WF-Shirley), who represents hard-hit South Shore communities, said her office received a flurry of complaints from upset constituents in the immediate aftermath of Sandy.


Delays criticized

Many homeowners have complained about NY Rising's cumbersome, drawn-out application process and have bemoaned delays in receiving money for all kinds of assistance -- repairs, elevation and purchase.

Browning, noting that the home-buying process can be lengthy and take many months even without a storm of Sandy's magnitude, said she is pleased that sales have become brisker in recent months.

"If you're buying a home yourself, it's going to take you six months to even get a sale, and that's without complications," Browning said, adding that she has spoken with constituents on both sides of the fence -- those happy with their experiences rebuilding or selling their homes through NY Rising, and those who were unhappy.

"I'm sure if I was one of the residents in that situation, I would probably want it to have happened sooner," she said.

Other lawmakers agreed that the delays are perhaps the program's Achilles' heel.

"I am hopeful that things are moving along," said Kevin McCaffrey (R-Lindenhurst). "It has done anything but move along so far, and the frustration for people has been terrible. The horror stories I hear from NY Rising just boggle my mind."

Sinclair, director of buyouts and acquisitions for NY Rising, said the agency is working as quickly as it can with hundreds of homeowners at once, each requiring verification of financial information such as title clearing and the other paperwork that comes with all home purchases.


Aims to be one-stop shop

In addition, she said, the agency functions as an advocate for people who might have a hard time selling their homes on the open market. Some homeowners are in foreclosure, are conducting complex estate sales, have divorces pending, or don't have enough cash on hand for a new home, all wrinkles that can complicate and delay sales.

"I don't doubt that it's never going to be fast enough for some people," Sinclair said, adding that NY Rising aims to serve as a one-stop-shopping case manager that handles all aspects of the sale, including guaranteeing the payment of the debt and, in some cases, consolidating people's debts. "We're acting as your debt consolidator, and we're playing all of these other roles to make your life better."

In Nassau, Island Park was at the top of NY Rising's list, with 66 homeowners completing applications for acquisitions and NY Rising issuing 54 offers of purchase. So far, there have been 14 closings.

Freeport, Long Beach and Massapequa followed in the number of state acquisitions so far in Nassau -- with 12, seven and seven homes, respectively.

In Suffolk, Lindenhurst -- including the areas of Strong's Creek and Venetian Shores -- led the way in the number of applications, conditional offers and closings for both acquisitions and buyouts.

Other communities in Suffolk where state deals have closed, according to the most recent figures, included Mastic Beach, with six acquisitions and six buyouts; Patchogue, with three acquisitions and five buyouts; Babylon, with eight acquisitions; and Flanders, where homeowners had flooding from Tropical Storm Irene in 2011 as well as Sandy, with 10 buyouts.

Mastic Beach Mayor Bill Biondi has consistently opposed the buyout program because it stipulates that such parcels remain as environmental buffers into perpetuity, removing them from the tax rolls.

"We're nervous, because we don't want to see our tax rolls dwindle down to nothing," he said, adding that he has heard complaints from residents who think the sales are taking too long. Others, he said, felt blindsided by the application of the federal Stafford Act, requiring that any insurance payouts for repairs be deducted from NY Rising's award for damages.

"People found out that they're not getting as much as they owe on their homes," he said, and some, like Gorman, decided to sell instead.

"I never thought I would leave that house," Gorman said. "I always thought I would live there until I was way old and my kids decided what to do with me."

She said the storm may have been a sign for her to move to North Bellmore, a Nassau community that is not in the 100-year floodplain.

"I'm at peace with my decision," Gorman said. "It took a long time to get to that, but I'm at peace with it."

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