April 09, 2004

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Palo Alto Online

Changes coming for flood regulations

by Bill D'Agostino

Rroperty owners whose buildings are subject to flooding are concerned new city proposals could unnecessarily cost them money.

The Palo Alto City Council will review and vote on changes to its flood hazard regulations on Monday night. City administrators said the proposals will keep Palo Alto in good standing with federal regulators, and therefore keep property owners' flood insurance rates down.

The new regulations will affect the 4,600 homes and businesses located near the many waterways in and around the city.

Palo Alto participates in a federal program that underwrites flood insurance throughout the nation. Congress started the program in 1968 because the nation's private insurance companies were historically unwilling to offer flood insurance, due to the fear of a costly catastrophe.

In exchange for letting its residents and businesses participate in the program, the city must impose federally mandated regulations to lower the government's risk.

All affected businesses and homeowners are required, for instance, to purchase private flood insurance and construct safer structures when they rebuild.

The Federal Emergency Management Agency, which administers the program, requested new changes to those regulations following an audit of Palo Alto's practices in 2000.

Not making the proposed changes could harm all residents and businesses, the city warns. The federal government currently gives locals a 15 percent flood insurance discount because the city is in FEMA's good graces.

That could be at risk if the city doesn't make the changes, city officials warned.

"We don't want to put people's flood insurance at risk," Assistant City Manager Emily Harrison said.

The most controversial proposal relates to a section of the city's code that triggers when property owners have to raise their property's elevations to meet flood hazard guidelines.

Currently, property owners have to raise the elevations of their buildings when proposed improvements cost more than 50 percent of their buildings' market value.

The brewing controversy surrounds something surprisingly esoteric: the exact meaning of the term "market value," which up until now has not been defined in the city's code.

The city's Public Works Department is proposing to define that term as the cost to replace the structure, depreciated over the building's age.

Some commercial property owners, though, are saying that definition will make it too difficult to make even minor changes to buildings, since such repairs would trigger stricter requirements.

"It would have a tremendous effect," warned commercial property owner Dan McGanney, the president of the California Pacific Commercial Corporation.

The city claims it has used the proposed definition for years.

"But since it's not in the code, it's always open to interpretation," said Joe Teresi, senior engineer with the city's Public Works Department. That has caused confusion for property owners and city administrators alike, according to officials.

But commercial property owners would prefer the city define the term by taking into account potential income a building could make.

Another proposed change will shut a loophole that currently allows property owners to build basements in the floodplain.

While it is currently very difficult to do so, a homeowner might be able to fly under the code if he or she could build a garage that doesn't cost 50 percent of a home's value, Teresi said.

Another proposed change would grant exceptions to the various restrictions placed on structures on the city's historic buildings list. That would expand the current regulations, which only give exemptions to buildings on the national and state historic registries.

The council meeting begins at 7 p.m. on Monday night, April 12, inside the City Council chambers (250 Hamilton Ave.).

Bill D'Agostino can be e-mailed at bdagostino@paweekly.com

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