Saturday, June 7, 1997
Money, paper chase begins
Cities have to raise matching funds,
handle paperwork for federal buy-outs

The Cincinnati Enquirer

FLORENCE- It could take two years before Falmouth leaders purchase the worst-damaged homes destroyed in the March 1 flood, Mike Lynch, hazard mitigation officer for the state Division of Disaster and Emergency Services, said Friday.

"I'm going to open an entire filing cabinet in an entire new room for Falmouth's application," Mr. Lynch told a group of city leaders gathered to get more information about how to begin the buy out process.

Falmouth has a tough job ahead simply because it has the most homes to buy. But leaders from Augusta, Butler, Melbourne and Warsaw also will face problems, Mr. Lynch said.

The first step is for communities to come up with their 13 percent of the total project cost - a task that will be difficult for some. Falmouth received $3.5 million in the buyout and must come up with $437,000 of that amount. Butler got $366,690 and must raise $61,000.

"We're now prepared to start spending money, and, in some cases, lots of it," Mr. Lynch said. "But if you don't come up with the local match, you don't have a project."

Melbourne already has the money it needs in the bank, Mayor Dutch Hehman said.

Other cities do not. Phil Turner, Farmer's National Bank president and liaison for the city of Butler, asked Mr. Lynch to use his clout to petition Gov. Paul Patton to create a revolving loan fund.

"The trouble is you've got to have the money on hand," Mr. Turner said. "The thing I'm afraid of is I don't have $456,000 in the city's checking account."

Neither does Falmouth.

Once communities have their local match, they must pay for appraisals, legal fees and the purchase price of the home. After submitting receipts, each locality will be reimbursed for real costs by the state during the length of the project.

Staff at the Northern Kentucky Area Development District and Mr. Lynch are working to find money the 24 communities with a buy out can use for their local match.

The hope is that Community Development Block Grant money will be made available with no strings attached. Under normal circumstances, communities would have to provide additional money to every person moved.

No matter where the money comes from, once it is in hand, communities must: adopt an ordinance that they will participate in the buy out; get agreements signed by each homeowner; check what other benefits each homeowner has received; conduct appraisals and title searches; buy the home.

"Create a property file for each one you're going to buy and stop throwing things out," Mr. Lynch said. "The state will need copies of everything."

Difficulties will arise as some owners of homes chosen for the buy out decide not to participate. Again, the problem is the worst in Falmouth, where a large number of the 97 worst damaged homes are being rebuilt, city Councilman Jeff Carson said.

"How do we decide to drop one and add another," he asked Mr. Lynch.

The answer is paperwork. Mr. Lynch said every change must be put in writing to the hazard mitigation office for approval.

Mr. Turner, who has 20 homes to buy in Butler, said he's not looking forward to the experience:

"This is going to be a nightmare."