December 21, 1998 - Diana and Lawrence Muzio knew they would have to move when they woke up
one morning in February to see their Laguna Niguel house splitting at the seams. They had
no way of knowing that they would still be on a maddening bureaucratic treadmill nearly a
year later.
Even as this winter's rains begin, the Muzios and more than 150 other California
families still are waiting to see whether local officials accept a federal offer to buy
out damaged or destroyed homes across the state.
When the federal government offered $22 million last month to help buy out California
landslide victims, state officials rejoiced. Washington has helped buy out flood victims
for years, but this was the first time it had ever made such an offer to landslide
victims.
But the offer came with a big caveat: Local governments from Orange County to Humboldt
would have to take title to the properties, demolish the structures and agree to leave the
land in a natural state forever. Local officials are hesitating, fearful that their
counties or cities will be legally liable if the land later gives way and slides cause
further damage.
"We told our council publicly that this was a 'buy a landslide' program, and our
question was: Who would want to?" said Tim Casey, city manager of Laguna Niguel,
where the City Council is still debating whether to accept the federal government's offer
to pay more than $6 million for 32 homes.
While city councils and county boards of supervisors weigh the risks, some homeowners
have had to fight banks seeking to foreclose on mortgages. Nearly all are still living in
temporary rental housing, unable to either go home or move on.
The Muzios and a neighboring family have been living in rented housing since the hill
underneath their house on Vista Plaza Drive shifted and sank in a landslide in February.
"Emotionally, it's hurt. It's taken a heavy toll on everybody," said Diana
Muzio, whose house on Vista Plaza Drive has been condemned. "And we have absolutely
no recourse. We are on our own."
Laguna Niguel and Laguna Beach were among the areas hardest hit by landslides triggered
by winter rainstorms. Laguna Niguel has been offered two federal grants: one for $462,475
for the Vista Plaza Drive landslide and a second for $5.6 million for the infamous
landslide on Via Estoril that has permanently displaced 50 families.
But the novel program, combined with the complexity of legal issues surrounding
landslides, has city officials pondering the best course of action. City Manager Casey
said they have asked for a meeting "with the highest FEMA official we can find"
to learn more about the potential pitfalls and promises of the buyout program.
But Laguna Niguel officials have stressed in letters to FEMA officials that they don't
want to own landslide-stricken property and do not want to use local funds to purchase
them, even if they are reimbursed later.
"Right now, we are the proud recipient of a grant for a program that has never
been tried before in California," Casey said.
For homeowners like the Muzios, the caution of local officials is understandable, but
it compounds their frustration.
"The paperwork, the forms, the continual sending of information--the same
information--over and over again," Diana Muzio said. "It's been a real
frustrating thing."
The Muzios lived in their house, in the Niguel Hills area, for 26 years, faithfully
paying taxes as upwardly mobile suburbanites.
"We struggled; we were a young family," she said. "We busted our butts
for this home, and we did everything we were supposed to do. And then this.
"I don't expect full recovery. I don't expect anyone to pay our way. But some
assistance after all these years of putting in seems to make sense."
Because the neighborhood is so old, laws do not allow the Muzios or their neighbors to
sue builders and developers. So for them, a buyout makes more sense to city officials
trying to plot policy.
But the larger landslide, which destroyed nine houses in the Niguel Summit development
and 21 units of the Crown Cove condominiums and soon will lead to the abandonment of
another 20 condos, is the subject of complicated litigation. In a partial settlement, all
41 condo owners will be bought out by developers of Niguel Summit. But other lawsuits by
homeowners and homeowners associations are pending.
City officials said the litigation makes any buyout legally tricky: Can the government
buy landslide-prone property from owners who weren't the victims of the landslides? If the
developers buy landslide property, are they allowed to benefit by a government buyback
program? Or are the developers "successor-victims" under the FEMA guidelines?
"We want to make sure we fully understand what the program requirements are,"
Casey said.
In neighboring Laguna Beach, FEMA is offering city officials a $124,000 grant for a
single property in the Canyon Acres neighborhood, hard hit by last winter's catastrophic
mudslides, which killed two men, injured more than a dozen and damaged dozens of houses.
But in a community that seems a natural target for a federal disaster buyout, city
officials said many houses in the mud-swamped areas did not meet federal criteria, which
required total demolition and no rebuilding. In many cases of even severe damage, property
owners made repairs and continued using the dwellings or declined to sell because they
wanted to rebuild.
"The owner has to be willing to sell and the property has to be red-tagged or
yellow-tagged," said Michael Phillips, community services officer for the Laguna
Beach Fire Department.
City Manager Kenneth C. Frank said despite the notoriety of the Laguna Beach disaster,
only four houses were considered destroyed by the time the mud had dried.
Frank said the devastation differed from that found along the Russian River, where
dozens of houses were destroyed or damaged in landslides.
There, some residents have grown angry with their local governments for hesitating to
take the federal government up on its offer.
"They don't really care," Phyllis LaCombe of Rio Nido said bitterly of the
Sonoma County supervisors who will decide her fate. "They don't have a concept of
what this is like, or that it could happen to them."
Rio Nido, a Russian River community about 60 miles north of San Francisco, was one of
the communities hit hardest by last year's El Nino storms. Some 34 houses were irreparably
damaged or destroyed when the redwood-forested hillside above Upper Canyon Three gave way
in February. Homeowners below the slide were evacuated for weeks, as a safety precaution.
Now the hill where the LaCombes lived for 11 years is fenced off with chain link and
posted with hazard signs. Guards hired by the county restrict access to the site, which
state geologists say could be subject to more slides. The LaCombes stopped visiting when
the county bulldozed their home in October. But they still mourn their loss.
"It was the little cushion we had," LaCombe said. "Every time there was
extra money, it went toward the house."
Vice President Al Gore visited Rio Nido soon after the landslide made the national news
and promised to help. Since the federal government had never before offered to help buy
out landslide victims, it was up to state and federal officials to find a way to make such
a program work within existing federal regulations.
After months of negotiations with California officials, the Federal Emergency
Management Agency announced last month that it was granting $22 million to help buy 165
properties scattered across 11 counties, including 14 homes in Los Angeles County. Each
homeowner was to be offered 75% of the pre-disaster assessed market value of the damaged
home. The rest of the funds would have to be raised by the homeowner, or come from local
government funds.
The federal emergency agency hailed the program as innovative. Local officials also
initially welcomed the offer.
"All I can say is that last February, we were in a situation where there was
basically no relief, public or private, for these folks," said Sonoma County
Supervisor Mike Reilly, whose district includes Rio Nido. "This is the first time
I've seen FEMA develop an entire program to help a classification of people in just 10
months."
Then local governments started taking a harder look at the requirements of the program.
Government lawyers didn't like what they saw.
Sonoma County's board of supervisors must decide whether to accept $3.4 million to buy
34 Rio Nido homes and another 10 homes elsewhere in the county.
"If the county takes the money and buys these people out, then the county owns
that property," said Sandy Covall, Sonoma County's emergency services coordinator.
"If the slide cuts loose from that mountain and inundates other houses below, the
county would be on the hook. There is no way to indemnify the county."
Across the state, other local governments are wrestling with the same dilemma.
"What it ends up doing is putting the local jurisdiction in the middle, between
FEMA and the homeowner," said Pat Canfield, assistant administrative officer for the
city of Los Angeles.
"FEMA has this one-size-fits-all program that doesn't really fit out here,"
Canfield said. The city is eligible for $2.4 million for 10 homes--5 in Northridge and
five in Studio City--that were damaged beyond repair in last year's landslides. The City
Council has not yet decided whether to accept the money, Canfield said.
"In other parts of the country, they are talking about flatlands," Canfield
said. "California has problems in the hillside areas, which makes accepting this kind
of grant really difficult for California communities. Every jurisdiction that applied is
taking it slowly and debating this."
In Los Angeles County, the federal government agreed to pay $860,500 for four homes in
Malibu and Topanga Canyon. The county is still studying whether to accept the money,
according to Bob Donohoe, with the Department of Public works.
Paula Schulz, state hazard mitigation officer for Gov. Pete Wilson, said the program is
the best that could be cobbled together on short notice to help people who had, in some
cases, lost everything.
"We feel that we were fairly effective in working with FEMA--not to stretch the
regulations, but certainly to adapt the program to fit this situation," Schulz said.
But the federal agency was adamant, she added, that a local government entity must take
title to the land and ensure it remain in a natural state after the buyout.
Even if communities are fearful of the liability problems, Schulz said, she believes
most will take the money because "there is a moral responsibility" to the
victims. Besides, she said, "they are in a better position to protect their citizens
if they have possession of the property," rather than taking the risk of a private
owner developing again on unsafe land.
Meanwhile, last winter's victims are left waiting, even as this winter's rains begin to
fall, showering frustration and disappointment onto the displaced.
"We were hoping to have this all tied up with a bow in time for Christmas,"
said Diana Muzio in Laguna Niguel. "Obviously, it's not going to happen."
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