With hurricane season upon us, employers are justifiably concerned about the potential impact of a natural disaster on their business. A hurricane, natural disaster, or any other crisis in the workplace can bring a business to a screeching halt and devastate the lives of a business’s most valuable asset, its employees.
To minimize the impact of a natural disaster, employers should have plans in place before disaster strikes, including, for example, a crisis management plan, a communication plan, and a disaster response and recovery plan. These plans must take into account the effect a catastrophe may have on workers and include ways to help impacted employees return to work as soon as practical to ensure continued productivity at the workplace following a natural disaster. Any enacted plan should consider the application of relevant federal and state laws to ensure compliance and avoid any employment-related lawsuits or any agency enforcement action following a natural disaster. Continue Reading Planning for a Catastrophe
The floodwaters from the aftermath of Hurricane Harvey have receded, and now it’s time to focus on the overwhelming task of getting back to normal, that includes protecting your property values. Below are helpful steps to do just that.
Step 1 – Notify Mortgage and Insurance Company and FEMA: If you have flood insurance, file a claim with the insurance company and schedule an appointment with the insurance adjuster. If you did not have insurance, file a claim with FEMA and schedule an appointment with a FEMA adjuster. This adjuster appointment should occur prior to conducting any demolition or rebuilding; however, with the extent of the damage to the Houston area, this may not be feasible since it may take weeks to schedule such appointment. In that case, document the damage, as discussed below. Filing a flood insurance claim will not prevent you from filing a FEMA claim; however, FEMA may require you to file an insurance claim prior to filing with FEMA.
Step 2: Document the Damage: Now that all claims have been filed, owners need to take steps to prevent further damage, such as patching or tarping damaged roofs and boarding up broken windows. Separate salvageable items and store in a safe dry place. Prior to any demolition or rebuilding, take photos and videos of the damage, including any standing water remaining in the home, visible floodwater level lines, structural damage and all discarded items. Ensure those photos and videos include a date/time stamp. Make a list of all damaged items, including the value, date of purchase and receipts, if possible, and going forward, be sure to keep copies of all receipts, work orders, contractor agreements, and all other items relating to clean up and rebuilding.
Step 3: Air Out, Tear Out, Clean Out and Dry Out(i): Once documentation has been completed and stored in a safe place, begin airing by opening windows, all doors, including closet doors, and all cabinets. Next, the property owner should tear out and remove all damaged furniture, carpet, flooring, sheetrock, cabinets and other porous items and furniture. Unlike Step 4 below, a property owner may do this on their own or hire a contractor to perform the work. No additional certification is required to “muck and gut” your property, and mucking out your property will not prevent you from obtaining a mold certification, discussed below. If your property is located in the City of Houston, report your debris to the Houston Solid Waste Management Department (“HSWMD”) by dialing 311 or report at Houston311.org. The HSWMD requests that all debris be placed on the sidewalk or edge of the property before the curb, and to be separated into six piles for pick up: (1) vegetative debris, (2) construction and demolition debris, (3) appliances, (4) electronics, (5) household hazardous waste, and (6) normal household trash(ii). Before any rebuilding starts, you or your contractor should follow all local ordinances and obtain all required permits prior to construction. It is important to note that the Texas Real Estate Commission’s Seller’s Disclosure Notice (“Disclosure Notice”) specifically asks the seller if they are “aware of any room additions, structural modifications, or other alterations or repairs made without necessary permits or not in compliance with building codes in effect at that time”(iii), so it is important to ensure that all ordinances are followed and permits obtained. The Department maintains a list of licensed mold remediation contractors on their website(iv).
Step 4: Mold Assessment and Remediation(v) : A property owner may treat their own property for mold; however, it is strongly recommended that you hire a licensed mold and remediation company. A mold remediation company will evaluate your property to determine if mold is present and at what levels, and if mold is present the company will remediate and remove the mold. Unlike Step 3, your insurance and/or mortgage company may require you to obtain a Certificate of Mold Damage Remediation (“CMDR”), which verifies that any mold located on the property was removed correctly. The Texas Mold Assessment and Remediation Rules (“TMARR”) require that all mold remediation companies/contractors have a license issued by the Texas Department of Health Services (the “Department”); however, the Department has waived such requirements for mold remediation and assessment companies for the duration of the disaster declaration in Harris and surrounding counties. Suspending the licensing requirement will allow those experienced remediation companies that are not licensed in Texas to provide necessary services. In lieu of licensure, unlicensed companies and persons who wish to conduct work in the Houston area may register with the Department. An unlicensed mold remediation or assessment company can provide mold services and assessment and can verify whether mold is present; however, unlicensed remediation or consultants cannot issue a CMDR. The Department pointed out that those licensed in Texas should inform property owners that using the waiver process may cause issues with insurance claims, so it is recommended to hire a licensed mold remediation or consultant. The Department maintains a list of licensed mold remediation contractors on their website(vi).
Step 5: Seller’s Disclosure: Should you decide to sell your home now or in the future, it is important to note that Texas homeowners are required to disclose previous flood damage and whether the property is located in a 100 year flood plain on the Disclosure Notice(vii). This form specifically asks the seller if they are:
– “aware of any previous flooding” and
– “the property is located in 100 Year Flood Plain.”
The above steps are things that you as an owner can do to protect the value of your property. Unfortunately, many Houston area homes will see low property values for the next few years. The drop in value will depend on the location of the property and the extent of damage caused by the flooding. For now, we are all in the same boat, still riding out the effects of our dear friend Harvey.
(i) “FEMA – Initial Restoration for Flooding Buildings” http://www.floods.org/PDF/FEMA_InitialRestorationFloodBldg.pdf
(ii) See http://www.houstontx.gov/solidwaste/debris_08302017.html
(iii) Texas Property Code § 5.008 and a copy of the disclosure form is available at https://www.trec.texas.gov/sites/default/files/pdf-forms/OP-H_0.pdf.
(iv) See https://vo.ras.dshs.state.tx.us/datamart/login.do;jsessionid=39CFC0D4B8F83F005338D87285E544C5.i-03a38ec2506c5b8dd
(v) Texas Department of State Health Services, “Emergency Guidance on Mold Remediation Under the Governor’s Disaster Declaration” and “Q & A on Mold Remediation Related to Hurricane Harvey”; https://www.dshs.texas.gov/mold/
(vi) See https://vo.ras.dshs.state.tx.us/datamart/login.do;jsessionid=39CFC0D4B8F83F005338D87285E544C5.i-03a38ec2506c5b8dd
(vii) Texas Property Code § 5.008 and a copy of the disclosure form is available at https://www.trec.texas.gov/sites/default/files/pdf-forms/OP-H_0.pdf.
In the wake of Hurricane Harvey, Jones Walker is reactivating the Disaster Prep and Recovery Blog and will be posting helpful information here. Our thoughts are with those impacted by this disaster in Texas.
During the recent historic flood event, thousands of homes across south Louisiana were inundated with floodwater. For most homeowners, the recovery process has just begun. Information on possible funding, temporary housing, or other assistance is available from FEMA and other organizations. But if you own a flood-impacted home, you face another significant and perhaps more long-term question: What can you do now to protect the value—including the resale value—of your home? The following are a few points to consider and suggestions.
Disclosure of Flood–Related Issues
Louisiana law requires a seller of residential property to complete and provide to the prospective purchaser a property disclosure form prescribed by the Louisiana Real Estate Commission (LREC).1 The LREC property disclosure form 2 includes the following questions, among many others, that must be answered by the seller:
- “Has any flooding, water intrusion, accumulation, or drainage problem been experienced with respect to land? If yes, indicate the nature and frequency of the defect at the end of this section.”
- “What is/are the flood zone classification(s) of the property?”
- “Has any structure on the property ever taken water by flooding (rising water or otherwise)? If yes, give the nature and frequency of the defect at the end of this section.”
- “Has there been property damage related to the land or the improvements thereon, including, but not limited to, fire, windstorm, flood, hail, lightning, or other property damage? If yes, were all related property damages, defects, and/or conditions repaired?”
- “Does the property or any of its structures contain any of the following? Check all that apply and provide the nature and frequency at the end of this section. . . . mold/mildew. . .toxic mold. . .contaminated drywall/Sheetrock.”
- “Were any additions or alterations made to the property? If yes, were the necessary permits and inspections obtained for all additions or alterations?”
So not only should the seller disclose flood-related issues to the buyer as a matter of good faith, the seller is required to do so by law.
1 (La. R.S. 9:3198.)
2 The LREC property disclosure form is available here. An amended version of the form will become effective on January 1, 2017; however, the amended form does not change the disclosures discussed in this article.
Note also that Louisiana law requires licensed home inspectors to describe in their inspection reports the presence of suspected mold growth if visual evidence of mold is discovered inside the home.3 A mold inspection is outside the scope of a standard home inspection; however, if the home inspector observes mold, he must say so in the inspection report.4
Past flood damage and current mold issues have the potential to negatively impact the value of your home. So what should you do?
Protecting the Value of Your Flood-Impacted Home
A key factor in protecting the value of your home will be how well you can demonstrate to prospective purchasers, appraisers, inspectors, lenders, insurers, and others that the flood-related damage was properly repaired or otherwise addressed. What you do now will impact the future value of your home. The following are a few suggested strategies: Continue Reading After the Flood—Strategies for Protecting the Value of Your Home
Effective August 29, homeowners impacted by the flooding in Louisiana can apply for Shelter at Home. This is a new program, announced by Gov. John Bell Edwards last week that allows flood victims to live at home while they continue to rebuild, rather than stay at a hotel, shelter or rental property.
If a damaged home can be made livable with up to $15,000 in repairs, then the state will provide a crew to do the work on the property.
The program is not intended to cover the cost of a full rebuild of a home and will only cover minor repair work such as basic electrical and plumbing inspections; carpet and insulation removal; air conditioning and hot water heater repairs; and installing temporary bathroom fixtures. The program will also pay for small kitchen appliances.
Residents eligible for the program can call 1-800-927-0216 or register online at shelterathome.la.gov.
Like you, many of our colleagues, families, and friends have been hit hard by the recent, historic flooding in Baton Rouge and surrounding parishes. Our hearts go out to all.
At such times, we can and must tap into two of our greatest strengths: our strong sense of community and our unmatched resilience. Together, we are in the initial stages of a massive recovery effort that will take time, but will yield positive results—this we believe.
As you begin to rebuild your homes, businesses, and lives, we know that you will have many questions, a number of which will involve legal concerns. For decades, Jones Walker has been at the forefront of regional and national disaster recovery efforts, helping clients prepare for, respond to, and recover from crises of all types and magnitudes. We can offer effective legal advice as you address your most immediate challenges, including issues involving FEMA programs, insurance coverage, real estate, employee relations, and more.
Please contact us with any questions or to learn more about how we can help. As we move forward in this process, we will continue to publish useful updates on our website and through client alerts and social media.
We wish you strength and peace during this difficult time.