Insurer might drop Hilton Head condos for electrical-panel problems

May 02--A Hilton Head Island condominium complex is under fire over apartment renovations some say put renters in danger.

BB&T Carswell Insurance Services has threatened to pull coverage from Xanadu Villas, saying those renovations violate the fire code, according to a letter from the insurer.

At least four condos at the South Forest Beach complex have been split into two individual rentals, residents say. The units are separated by deadbolted doors.

The practice leaves one unit without an electrical panel, which increases the risk for renters and responding firefighters in an emergency, Town of Hilton Head Island fire officials have said.

BB&T's letter adds fuel to a brewing controversy over the split units.

Several South Forest Beach residents have begged the town for years to act to stop the practice. Some of them fear other insurers might follow BB&T's lead and cancel coverage at other complexes with split units, including Oceanwalk Villas, which has about 44 split units in the 79-unit development.

But the question of whether the split units violate town code is up for debate.

Town attorney Brian Hulbert has offered different opinions, residents say. Hulbert most recently said a locked door separating a renter from the electrical panel does not violate the ordinance.

Mayor David Bennett and councilman Tom Lennox, however, aren't convinced.

They've asked for a second opinion from town attorney Greg Alford.

The confusion led town manager Steve Riley to look beyond Hilton Head. Next week, he'll send a letter to the International Code Council, which develops building codes, to ask if the split units are a violation.

"I don't need anymore of the 'he said, she said,'" Riley said. "Let's go to the source."

UNSAFE UNITS?

Residents have known about split units at Xanadu -- which has 72 condos -- since last year.

At the four known split units, owners have turned three-bedroom condos into two separate apartments. Owners seal off the "mother-in-law" one-bedroom suite with a deadbolted door and add a kitchenette to make it a stand-alone rental.

In a March letter, BB&T said it would cancel insurance at Xanadu if owners did not restore the units to a single entity. The company said the "modified units" violate fire code. Attempts Thursday to reach a representative from BB&T were unsuccessful.

The deadline to restore the units was Friday, according to residents. Craig Fenstermaker, vice president of IMC Resort Services, which manages Xanadu, said Friday the insurance company extended the deadline to June 8.

Curtis Coltrane, an attorney for Xanadu's homeowners board, said the complex is in "no danger of losing insurance."

BB&T "said as long as the board is doing something to fix the problem -- to the extent it exists -- it will work with us through the process," Coltrane said Thursday. "The board is making a number of efforts to determine if a violation exists."

Canceled insurance would bring financial consequences for Xanadu owners, according to residents and local insurance agents.

Without insurance, the regime would be liable for all damages in a fire or other emergency. It would also affect those owners with mortgages requiring the complex to have insurance.

"There would be a lot of ramifications," said John Alagna, who owns Carolina Heritage Insurance. "It would expose the individual owners."

Several South Forest Beach leaders worry about what the loss of insurance would mean for the area.

"These units are unsafe. Soon they will be uninsured," said Jack Daly, president of Forest Beach Owners Association. "If the whole place burns down, what happens to people on fixed incomes? They're screwed."

CONFLICTING OPINIONS

Residents have lobbied the town to enforce the national electrical code, which states "each occupant shall have ready access to all overcurrent devices."

But town officials haven't clearly explained whether the split units violate code.

The main dispute is over the term "ready access."

In a letter last summer, town staff members ordered owners of divided condos to stop sealing off one unit from another in a way that limits access to the electrical panel. That included units that were divided by a locked door.

But recently, the town issued a letter saying a locked door did not impede "ready access" to the electrical panel for renters so the units did not violate code.

"There have been a lot of different interpretations by staff members," Riley said Friday.

Mayor Bennett met with staff attorney Hulbert, who enforces municipal code, and other staff members earlier this week about the issue.

Bennett said he was not satisfied with the town's most recent interpretation. He worries a deadbolted door might violate the "ready access" requirement of the code.

He asked Lennox to get an opinion from Alford.

"In my view, having a deadbolt on the door brings the whole thing into question," Bennett said. "I'm not a lawyer, but I think we need a closer look at the arrangement to determine if there's a violation."

Even code experts have differing views on the issue.

Marc Ramirez, who spent more than 20 years at the National Fire Protection Association, said that if the apartment without an electrical panel has cooking appliances and no building manager on duty, then the fuse box should be accessible to the tenant.

But Mike Holt, a Florida electrician who trains professionals on electric code, said having an electrical panel behind a locked door is not a violation.

"What would you do with all the commercial and industrial buildings with locked equipment rooms?" Holt asked. "Are you going to allow the schools to keep all their equipment rooms unlocked?"

The conflicting views prompted Riley to ask the code council to weigh in.

"Let's give the facts to them," he said. "Let's find out if this is a violation, and what we should do from there."

Follow reporter Dan Burley at http://www.twitter.com/IPBG_Dan

___

(c)2015 The Island Packet (Hilton Head, S.C.)

Visit The Island Packet (Hilton Head, S.C.) at www.islandpacket.com

Distributed by Tribune Content Agency, LLC.