Homeowners With Failing Foundations File Formal Complaint With U.S. Attorney

July 21--Homeowners with failing concrete foundations have filed a formal complaint with the U.S. Attorney asking that federal officials investigate what the state of Connecticut knew about the issue.

Since the issue of failing foundations came to light, Gov. Dannel P. Malloy has said as many as 34,130 homes are at risk for failing foundations. More than 500 homeowners in 23 towns have filed complaints with the state Department of Consumer Protection stating that their concrete foundations are failing.

According to a state report in early January, a mineral known as pyrrhotite was present in the concrete aggregate used for the foundations that are now crumbling, and was partly to blame, as was the amount of water used in installation.

Insurance companies have denied homeowners' claims, saying the problem does not qualify for coverage under their definition of collapse, leaving homeowners to bear the burden of a costly foundation replacement. The cost to replace a foundation can be as much as $200,000.

Homeowners have sought numerous solutions to the problem including lawsuits against their individual insurance companies and a class action lawsuit against 111 active Connecticut insurance companies.

Legislative solutions on the table for homeowners include $5 million for testing foundations and a grant program to fund up to $150,000 or 75 percent of the cost to replace a crumbling foundation administered by the Capitol Region Council of Governments.

Legislators also proposed a $12 surcharge on certain property insurance policies in the state that would go into an assistance fund for homeowners.

In addition to state legislation, Malloy has worked to find federal and state solutions for homeowners in Connecticut. Last week, he requested a briefing by the Army Corps of Engineers on the issue and he has also contactedthe Federal Emergency Management Agency for assistance on two occasion.

In Washington, Reps. Joe Courtney and John B. Larson announced on Friday that the national taxpayer advocate, Nina Olson, has requested guidance from the Internal Revenue Service's chief counsel to allow victims to apply for federal tax relief.

Courtney is also advocating for Housing and Urban Development grants to help with the issue.

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