Pasco pushing for mandatory sinkhole testing

County officials say testing for sinkholes would protect homeowners from potential problems. Pasco County officials are examining a new way to protect potential home buyers from sinkholes. The proposal would call for contractors to test areas for potential sinkholes before construction began.

This would ensure that geological testing on the property took place and there would be a record that buyers could look up if needed.

Pasco officials are working on the rule, still just in the planning stages.

"We have an effort underway to recognize areas that have significant geological hazardous conditions,'''' said Pasco Assistant County Attorney Elizabeth Blair. "(This would make) builders direct housing development away from those areas.''''

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In addition to warning buyers about the potential for ground settlement or collapse, the required testing would encourage builders to build away from sinkhole hot spots or compensate for it.

"The hope is that this is recognized by the insurance commissioner and at some point implement it into rates paid in Pasco for property insurance,'''' said homebuilder Craig Fiebe. "If we have geotech maps with high incidents of sinkholes, it may be worth it to randomly test.''''

But Fiebe warned that making sinkhole testing mandatory could also add more to the cost of building a home.

Pasco officials, meanwhile, said details of any type of mandatory sinkhole testing are still being worked out. The county will hold a to-be-scheduled public hearing on the issue sometime in August. 

Citizens Option Slashes Rates

- Premiums might drop by about half for many Pasco County residents who remove most sinkhole coverage from homeowners insurance policies with Citizens Property Insurance Corp.

State regulators late Monday granted permission to Citizens, the state-backed insurer of last resort, to allow the sinkhole coverage exceptions, said state Sen. Mike Fasano, R-New Port Richey, and state Rep. John Legg, R-Port Richey.

Estimated savings on premiums range from 46.7 percent to 56.8 percent for west Pasco residents who opt for little or no sinkhole coverage. For the remainder of the county, savings could be 49 percent to 56.8 percent.

The changes would make sinkhole coverage optional for foundation cracks and similar problems.

Catastrophic losses would remain part of the main policy through Citizens if a home becomes unlivable when the ground collapses.

Once Citizens submits revised rates, within two months, each homeowner would still have to sign a form to opt out of sinkhole coverage to get the discount.

Fasano said the percentages were larger than he expected. He cited Pasco''s hiring of lawyer Timothy Volpe of Jacksonville to evaluate the county''s homeowners insurance rates as helpful in getting the premiums lowered.

Legg and Fasano praised the order. The sinkhole exception was heavily promoted during a Dec. 18 public hearing here.

"This decision ... is an enormous victory for the residents of Pasco County who are covered by Citizens," Legg said.

Rates should go down for private insurers as well, the lawmakers said. Legislation was passed during the special session to grant the same sinkhole coverage option to customers of private firms.

Ginny Stevans, president of Having Affordable Coverage, said her group is skeptical and worries that the plan could backfire.

Stevans said many mortgage companies could still require homeowners to carry sinkhole coverage. It will likely now be more expensive to do because the risk pool will be smaller, Stevans said.

HAC worries that policyholders could suffer from a sinkhole that renders their homes uninhabitable but does not meet the definition of "catastrophic."

"There was not a lot of homework done on this plan before it was popped into action, which is why we can''t support it," Stevans said.

Fasano grew frustrated when told of Stevans'' comments. The major banks and mortgage companies Fasano consulted said they will not require sinkhole coverage.

Policyholders who opt for sinkhole coverage will be given a 10 percent discount, per order of the Office of Insurance Regulation, Fasano said.

And if a house is rendered uninhabitable by a sinkhole, it will be condemned by its county or city, which will kick in the catastrophic coverage, he said. "Those who are criticizing should read the bill first," Fasano said.

Pasco editor Mary Hitt McCoy and Hernando Today reporter Tony Marrero contributed to this report.