SCREMP Property Insurance and FEMA
Workshop
Tuesday, December 7,
2004 – 5:00 p.m.
School
Board Meeting Room
Stuart, FL 34994
Members
Present
Susan Hershey –Chairman
Lorie Shekailo-Vice-Chair
Dr. David Anderson
Laurie Gaylord
Nancy Kline
Dr. Sara A. Wilcox, Superintendent
Tom Elfers, School Board Attorney
Members
Absent
Katie Gillen, Student Representative (MCHS)
Staff
Present
Rodger Osborne, Rose Taylor, Ruth Pietruszewski, Stacey
Chados, Julie Sessa, Steve Rusnak, Mark Cocco, Deborah Crowder, Wilma Schuler,
Jim Copeland
Public
Mark Fogle,
Marsha Jones, Bill Mc Creary, Terry Isaacson, Rick Mullen, Teresa Carter, David Shapiro
Press PBPost – Rani Gupta Stuart
News – No representation
MCEA – No representation AFSCME – No representation
Call to Order by the Vice-chair and Pledge of
Allegiance to the Flag of the United
States.
1. Presentation on SCREMP Property Insurance and FEMA
Julie stated that two Board presentations, one after
hurricane Frances
and one after hurricane Jeanne, regarding property loss on all locations, the
district’s participation in the SCREMP program, insurance policies, and how
those things would dovetail with FEMA had been provided. The purpose of this workshop was to provide
an in depth look into our insurance participation in the SCREMP pool, how the claims
process works, and understanding FEMA reimbursement. She introduced Bill McCreary, Administrator
from Employers Mutual Inc and Marsha Jones, EMI Account Executive. She introduced Rick Mullen, CJW Executive
general adjuster, from an independent insurance and adjusting consulting firm
who has worked with the district throughout both storms. She introduced Teresa Carter, disaster planning and recovery consultant,
hired by the SCREMP board to assist districts in the FEMA reimbursement
process.
Bill McCreary explained there are eight school districts
in the SCREMP program. The company has
two billion dollars in insured property.
The property insurance provides $250 million per occurrence; therefore,
for each storm there is $250 million.
SCREMP has approximately $50 million in losses for hurricanes Frances
and Jeanne. SCREMP will pay out $2.5
million from the self-insured retention fund and then will collect from
insurance carriers. This expense is
eligible for FEMA reimbursement. The
losses will be equally shared by members in the pool allocation based on the
loss those members sustained. SCREMP
cannot apply for reimbursement. Individual members must apply for the
reimbursement. The FEMA recoveries will be $7.5 million. Martin County
will have to recover 36% or $900,000.00. The deductible is 2% of replacement
cost on the building and contents at the time of loss. The deductible is also a FEMA eligible
expense. One carrier is not willing to take the risk on the whole amount, so
coverage is bought in layers from several carriers. There are fifteen different
insurance companies. The carriers have agreed to use a single adjusting firm to
handle claims. Recovery needs to be maximized with FEMA, since FEMA recovery costs
will be about 13 ½ million dollars. Sub
limits of coverage will pay to bring portables in, set them up, cover employee’s
overtime, and whatever expenses are needed to resume educational services. It will not cover operating costs, such as
electricity. Martin County
has a maximum of $3.6 million for debris removal
1. Presentation on SCREMP Property Insurance and FEMA (Con’t)
on insured property for hurricane Frances. There is no anticipated problem having enough
coverage for debris removal for either storm.
Building ordinance coverage will be used to provide for increases in the
cost of rebuilding due to changes in ordinance.
Each building will be submitted as an individual loss. CJW will determine replacement costs on an as
is basis. They also determine
replacement costs bringing the building up to code. The School District
is responsible to obtain a bid from a contractor for repairs. The District must submit this bid for repair
cost as their proof of loss. The insurance policy will provide the same kind
and quality of the building being replaced.
If the damage of the building is less than 50% of replacement, the
insurance company will repair instead of replace. If the damage is over 50% of
replacement, then the building can be replaced with new. FEMA looks at replacement to code to
determine whether you repair or replace.
Bill McCreary provided several example scenarios with available options
to explain FEMA coverages, deductibles, and depreciation.
Julie explained that two separate projects have been
created in finance to track costs with regard to hurricanes Frances and
Jeanne. The estimated cost to damaged
facilities and other eligible costs is currently estimated at $17,000,000 for
hurricane Francis and $18,000,000 for hurricane Jeanne. Funds have been allocated to capital budget
projects 1234 and 1235. The total expenditures to date for damages from hurricane
Frances
total $6,305,410, with insurance reimbursement totaling $4,680,000. The total expenditures to date for damages
from hurricane Jeanne total $4,588,844 with no insurance revenue collected to
date.
Teresa Carter
and David Shapiro, Shapiro Disaster Planning and Recovery Consultants, were
hired by SCREMP to help with insurance issues and to work with FEMA. FEMA will take the scope of work required
and write up a project work sheet based on the district’s costs for replacement
and repairs. FEMA’s line items will be
based on district costs and will list insurance proceeds as a line item. The
bottom line will show the net proceeds expected from FEMA. The district has insurance for ordinance coverage,
but not asbestos removal or mold
Asbestos removal is a federal mandate.
FEMA will cover the asbestos removal and possibly mold removal. Insurance
will have to be completely settled before FEMA’s coverage can be determined. All
FEMA dollars are sent to the state. FEMA
dollars will be received through the state.
Head Start is an example of a third party funding source. The 2% deductible is covered. FEMA has a
program called 406. 406 is mitigation
and directly related to the public assistance program. FEMA will fund additional dollars for cost
beneficial projects. FEMA covers 90%, the state covers 5%, and the district’s
responsibility is the remaining 5%.
Details on showing need and waiving the remaining 5% have been
unavailable. As of this moment, the
district will be responsible for 5% of damages.
Section 404 funds are a pool of money based on 7.5% of every dollar
spent on every disaster. There will be
about 16 million dollars in funds for Martin County. To access the funds we must work with the
county. They will try to determine which
projects would benefit the county most as a whole. Shelters are priorities, so
it puts schools high for points on the project’s priority list. If other counties don’t need their funds,
more funds may be given to Martin
County. This is a state
run program, even though the money comes from the federal government. It may be a year before the bottom line costs
are known. Recovery will be a long process, but the district will end up with
much better facilities.
Sue Hershey asked about mitigation funding. Teresa answered that 406 mitigation is
directly related to damages and FEMA funds it prior to doing the work. The state administers 404 funds. They come from FEMA through the state. It is
a state decision as to how the funds are dispersed, but FEMA must agree with
the state decisions. April is the final
deadline to have all projects given to the state for mitigation funding. Dr.
Sara A. Wilcox asked if generators for lift stations for schools being used for
shelters could be funded. Teresa said
they would tie it to the overall shelter project for funding. The School District will go through the county for the
funding. Sue Hershey suggested that a
projects list be added to the discussion at the interlocal meeting. Mark Cocco
and Julie Sessa have already prepared a list.
The local LMS deadline is 12/15/04. Emphasis
will be on collecting the insurance coverages first.
Insurance coverage and FEMA assistance under the Public
Assistance Program must effectively combine to restore damaged facilities to
pre-disaster function and to replace facilities that were destroyed. Opportunities such as Hazard Mitigation and
improved projects must be identified and applied in order to maximize all of
the resources that are available under FEMA’s Public Assistance Program.
Dr. Sara A. Wilcox asked Julie to describe the efforts
being made to return staff and children to Pinewood Elementary School. Julie stated they have worked feverishly
sorting, unloading, and documenting the condition of furniture. Eighty per cent of the furniture will be
demolished. New furniture and equipment has been ordered. All stakeholders met in a meeting and
discussed what was needed to reopen. Another
logistics meeting is scheduled for January 9, 2005. Teachers,
custodians, and maintenance staff will be coordinated to help with the move
over winter break. Teachers are being
paid one day’s salary in order to move back to the site. Those salary funds are
1. Presentation on SCREMP Property Insurance and FEMA (Con’t)
being paid by insurance and any dollars uncovered by
insurance will be FEMA eligible.
Custodial and maintenance staff will move the boxes after the teachers
pack everything. The Administration and
Media center will not be occupied initially.
Sue Hershey commended Julie Sessa and Mark Coco for being
so organized and doing a wonderful job.
2. Open to the Public
·
There
was no representation.
.
3. Open to the Board
·
Lorie Shekailo thanked everyone for their time
attending the workshop and answering all the questions. She appreciated everyone providing
explanations.
·
Nancy
Kline concurred and complimented everyone for doing a great job, especially for
putting the information in lay terms, so it was easy to understand.
·
Laurie Gaylord agreed.
There being no further business to bring before the
Board, the meeting was adjourned at 6:15
p.m.
_______________________________
CHAIR (Sue
Hershey)
_______________________________
SECRETARY
(Sara A. Wilcox, Ph.D.)