Storm gone, but claims coming in

COUNTING BEANS: Mark LaHoud, owner of Java Madness in Wakefield, estimates spoiled food and lost sales cost his business more than $20,000. / PBN PHOTO/BRIAN MCDONALD
COUNTING BEANS: Mark LaHoud, owner of Java Madness in Wakefield, estimates spoiled food and lost sales cost his business more than $20,000. / PBN PHOTO/BRIAN MCDONALD

Tropical Storm Irene’s strong winds blew in mountains of paperwork for Rhode Island businesses and governments seeking to recoup money spent on lost sales and cleanup.
By many accounts, Irene left little in the way of physical damage. But its gusts of up to 80 mph proved strong enough to down power lines and cut electricity to 282,280 customers or 65 percent of the state. Each day in the dark for businesses meant lost revenue and, in the case of restaurants, spoiled food.
In South Kingstown, Java Madness had no power for five days. Owner Mark LaHoud estimates spoiled food and lost sales cost him between $20,000 and $25,000. Last week, he expected to spend a few days filing an insurance claim. His staff already spent the better part of four days after the storm documenting all the food they threw away.
He is not the only one filing. Mark Male, executive vice president of the Independent Insurance Agents of Rhode Island, said agents are telling him they are awash in claims. Male said he expects claims for physical damage to wrap up quickly, because storm damage is typically straightforward.
Claims for lost revenue, however, could take longer. Business owners will need to estimate their lost sales based on historical records. For some, like LaHoud, it will be their first time filing a claim.
Male said he anticipates insurance companies will move swiftly to settle claims. Those are the insurers that do not risk losing customers, he said.
“It’s the insurance companies’ opportunities to demonstrate their value,” Male said.
Central Rhode Island Chamber of Commerce President and CEO Lauren Slocum expected business owners to be handling insurance and other paperwork related to the storm until at least the middle of September. Some, she said, are also seeking unemployment waivers from the state. After the storm, the R.I. Department of Labor and Training announced that employers forced to lay off workers temporarily because of the storm could help them collect unemployment insurance benefits sooner if the employers apply for a waiting-period waiver. Also, employers whose storm-related property damage resulted in layoffs may be granted relief from related unemployment-benefit charges if they file a waiver.
To cover their own costs, businesses will need to rely on private insurance. President Barack Obama’s Sept. 3 disaster declaration did not open the door to federal assistance for private businesses of homeowners. Instead, the declaration only opens the potential for assistance to governments. (Gov. Lincoln D. Chafee’s spokeswoman, Christine Hunsinger, said last week that there were no plans to ask the president to expand the declaration, but did not rule out such a request as the state gathered more information.)
The Federal Emergency Management Agency will pay 75 percent of costs associated with responding to the storm and associated cleanup costs. The governor’s office pegged local costs at $8.5 million as of Sept. 2 – the latest information available. Officials broke down the costs as $5.2 million for Providence County, $1.3 million for Washington County, $996,676 for Kent County, $467,760 for Newport County and $462,825 for Bristol County.
As of last week, many communities were still tallying the exact costs of the storm. Officials in East Providence, South Kingstown and West Greenwich did not know their costs, but all the officials expected the totals to be relatively minor in their grand budgets.
In Narragansett, workers must repair a park maintenance facility hit by a downed tree that caused $10,000 in damage. And sand may need to be brought in to replace an eroded beach, said Town Manager Grady Miller. In Warwick, Mayor Scott Avedisian estimated the city incurred between $800,000 and $1 million in storm-related costs. The city experienced erosion at city beaches and faced costs associated with overtime for emergency officials and crews clearing downed trees. Workers also must replace a generator that failed during the storm and repair a boardwalk at a city park.
“We actually did better than anyone anticipated, because we were thinking the storm was going to be much more intense,” Avedisian said.
To the north, officials in Cranston were still picking up downed trees more than a week after the storm. Director of Administration Jerry Cordy said he expected cleanup would continue into this week.
Last week city officials were estimating at least $2 million associated with cleanup and emergency-response costs. Cordy expects the city to compile reams of reports necessary to collect the federal money.
“There’s going to be a lot of paperwork, a lot of reports and a lot of backup documentation,” Cordy said.
Those reports will travel first to the R.I. Emergency Management Agency and then to FEMA. The federal agency wants the reports no later than Oct. 3, which marks 30 days after the president’s declaration.
The agency has already established a small field office in Cranston. This week it expects to send teams out to meet with local and state officials and advise them on the FEMA process.
After that, there are follow-up questions, further reporting and lots of accounting. So just how long does Cordy think Irene will stick around on his desk?
“To give you an idea, I’m still working on stuff from the flooding in March 2010,” he said. &#8226

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