Bolivar Peninsula: Buyout of storm properties one of largest in US

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by T.J. Aulds/ The Daily News

khou.com

Posted on April 5, 2011 at 7:01 AM

BOLIVAR PENINSULA, Texas — Two and a half years ago, the beach front along Avenue J in Crystal Beach featured a row of houses with a Gulf view and 200 feet of beach.

That was before Hurricane Ike.

Now, lots are vacant, and the beach is about 30 yards from what passes for a dune line. The properties that once lined the road now are owned by the county and will be vacant forever.

Galveston County is in the final stages of one of the largest property buyout programs in United States history.

Using $100 million from the Federal Emergency Management Agency’s Hazard Mitigation Program, the county has purchased 338 properties across the county and by year’s end should have ownership of about 650.

Most of those are on the Bolivar Peninsula — 434 in the community of Gilchrist alone.

The program aims to clear properties that are prone to flooding and damage that lead to repeated national flood insurance claims.

Public Space Forever

The vacant lots left behind will remain as empty, public space in perpetuity. Some limited uses for the property are allowed, including converting lots into low environmental impact shower and bathroom facilities, unpaved parking areas or temporary vendor spots.

Most of the properties likely will be leased to neighboring property owners, who will pay the county a minimal fee to have access to the property and will maintain the land. Those leasing the property would not be able to fence in or build a structure on the property.

The properties can be converted into parkland, especially for homeowners associations.

The county also is in talks with the Audubon Society to make several lots part of the group’s nature preserve on the peninsula.

Galveston County Parks Director Dennis Harris was particularly interested in beach-front properties he might be able to convert into amenities such as showers, nicer restrooms and even portable vending spaces.

"Anything we can do to enhance the beach-going experience (on Bolivar) would be an asset," Harris said.

Last week, Harris and other county, federal and state officials got a closer look at the properties.

Thumbs Up From FEMA

"The county could have looked at all these properties and said, that’s too bad about the destruction, and just left the property owners to fend for themselves," said Kent Baxter, FEMA’s chief of the hazard mitigation assistance program.

"But (the county) was proactive, realizing that these people had real mortgages and that they could be in a position to never rebuild," were it not for the money used to purchase their properties.

Baxter said the buyout program in the county ranks among the top two in FEMA’s list of largest buyout programs.

"It’s the largest for this region," he said. "It’s in the top two nationwide ever. The county has done a remarkable job with this program."

So smooth that John Simsen, the county’s emergency management coordinator who oversees the buyout program, said the county sent back about $32 million to FEMA that won’t be needed.

The county expects to send about $2 million more back to the federal government by the time the program wraps up in December, Simsen said.

Program ‘Made Me Whole’

Alan Robb, who had five of his six Bolivar Peninsula properties in the program, would agree the program has been effective. All were beach-front houses and all were wiped away by Ike’s storm surge.

He recalled visiting the peninsula about two weeks after Ike made landfall.

"The whole landscape had changed," Robb, a League City resident, said. "You couldn’t tell where things were supposed to be and what was or wasn’t your property. We recognized very early on it was going to be difficult to rebuild."

Especially since many of his properties were now so close to the water, they were considered public beach.

At first, Robb held onto the properties to see if he could rebuild. But with mortgages totaling $20,000 a month and no income, that was not a long-term option.

Insurance payments were not near enough to pay off the mortgages and with one property that already had gone into foreclosure, Robb turned to the buyout program.

"In a sense, it made me whole," he said. "You don’t come out as well as you would have had you sold pre-hurricane. It beats the alternative.

"All things considered, I have taken a loss, but I will say that without the buyout program, if you looked up the word ‘loss,’ you would see my picture."

Whether he invests in the peninsula again is up in the air, Robb said. For now, he is focused on repairing his credit rating that took a hit as he sought options soon after the storm.

Still, he takes the experience in stride, noting that people who actually called the peninsula home, including his sister, "had it way worse than me."

New Phase For Retirement

William Arnold was one of those. In a matter of a few hours, his dream retirement home on the waterfront on Bowers Lane in Crystal Beach was gone.

"All that was left was part of the slab that was crumpled up and parts of a few pilings," he said.

Initially, Arnold planned to "skedaddle and wait and possibly rebuild or see what I could get for the property."

Instead of waiting for the market to recover, he signed up for the buyout program.

"I decided I was too old to rebuild," Arnold, 68, said. "So I entered the buyout program and I told my neighbors about it and almost all of them signed up, too."

Arnold’s glad he did.

"I made out all right," he said. "I can’t complain. The buyout part really helped."

Thanks to the buyout, Arnold said he wouldn’t have to worry about a $60,000 mortgage he had on the property.

While convinced his age prevents him from returning to the peninsula full time, he said: "I still miss it. I miss living there."

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County Buyout By The Numbers

Total FEMA buyout applicants: 1,247

Approved for buyout: 913

Applicants wanting to move forward with process: 649

Applicant offers presented: 537

Applicant offers accepted: 471

Closings scheduled: 359

Completed closings: 328 (as of April 4)

Total funding for program: $102.716 million

Amount returned to FEMA wont be used: $32 million

Dollars spent on closings thus far: $45,785,809

Administrative expenditures by county to contractor BDR/SAIC: $1,475,000

NOTE: Not all applicants will accept the county’s offer. Many are "sitting on the fence," officials said. Applicants can pull out of the program up until closing day.

SOURCE: Galveston County Office of Emergency Management

This story was brought to you thanks to khou.com’s partnership with The Galveston County Daily News.

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