Without Codes, Insurance Rates Could Skyrocket Bonner County Plan To Save Home Builders Money Likely To Backfire
Bonner County residents now may pay only $10 to build a new home because commissioners abolished the building department, but the cost to insure that home could skyrocket.
Two new commissioners pushed through the radical plan to eliminate building codes and staff, saying it will save residents money. But commissioners were unaware of a new policy by insurance companies that will benefit areas with strict building codes.
This year many western states, including Idaho, will have their building departments rated by insurance companies, just like areas are rated for fire insurance. Those cities and counties without building codes will be considered a higher risk and rates could jump.
“This will affect the citizens of Bonner County right in the pocket book. It’s that simple,” said Dennis Davis, a building official in Nampa, Idaho. Davis’ department is about to be reviewed by the Insurance Services Offices.
“The scary part is they only plan to come through once every 10 years. If you don’t get the highest possible rating the first time, you are stuck,” Davis said. “That could be significant dollars for homeowners. We are shaking our heads down here at what Bonner County did. This is a radical move in the other direction and it’s shocked people across the state.”
Insurance companies instituted the new policy after huge losses from earthquakes, floods and tornadoes. The areas damaged most were not actively enforcing building codes, said Al Frieze, general manager of the Idaho Surveying and Rating Bureau. The private corporation will review building departments in Idaho for insurance companies.
“If there are no codes in Bonner County, it means those building new homes would not have an insurance credit available to them,” Frieze said.
Insurance rates are one of the many problems Bonner County will face. Residents are asking for refunds that could amount to $1 million, for inspections they paid for and will not get. If there is another disaster, like last year’s flooding and this year’s snowstorm, the county could be ineligible for Federal Emergency Management Funds, said Rick Ulveling, the Idaho State Building Inspector.
“I can tell you right now they won’t hand out money for structural failures when there is no way to tell if they were built properly in the first place,” Ulveling said. That’s happening now in Boundary County, which has no building codes, he said.
“This is the biggest step backwards I have seen a county take. I see all kinds of problems coming,” he said. “I work with areas that are trying to get their own departments and get on their feet. This is the first time I’ve seen someone try to get rid of one.”
Ulveling conducts inspections for cities and counties without building departments. At least three counties he worked with, including Benewah and Shoshone counties, have since created their own building departments.
Ulveling already is fielding calls from Bonner County residents who want him to inspect their new homes. Cites such as Oldtown and Blanchard, in Bonner County, also asked him to take over inspection duties because the county no longer requires them.
Ulveling can’t do the inspections unless he is asked to come up and take over the area by Bonner County commissioners. That, he said, is not likely to happen.
If the state does take over inspections, they will be more expensive. The county used fees and codes set in 1982. The state uses a 1994 fee schedule and has more stringent regulations.
“That is what is so unbelievable,” Ulveling said. “They were operating under fees that were awfully low. This is a big step backwards.”
The lone commissioner to oppose axing the building department, Democrat Dale Van Stone, is fighting the decision. So are a group of bankers, builders, lenders and residents who hired their own attorney to sue the county.
Van Stone is contacting the state Attorney General’s office, accusing his companions of holding an illegal meeting when they decided to abolish the department and eight employees.