THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Monday, March 20, 1995 TAG: 9503180137
SECTION: BUSINESS WEEKLY PAGE: 04 EDITION: FINAL
TYPE: Talk Of The Town
LENGTH: Medium: 77 lines
Floods in California cost the federal government a bundle in disaster relief. Now the floods could have repercussions on businesses and homeowners in Hampton Roads.
Throughout the nation, only about 20 percent of homeowners living in flood plains are covered by flood insurance.
Federal law prohibits federally insured lenders from financing homes in flood-prone areas unless the dwelling is covered by flood insurance. Typical homeowner policies do not cover flooding.
But few pay any attention to the law. Mortgage banks and firms that buy mortgages from banks are not required to demand flood insurance from homeowners, and seldom bring up the issue when policies have lapsed.
Homeowners avoid buying expensive flood insurance because because they underestimate the risk of floods. And even communities enrolled in the federal flood insurance program also take little interest in enforcing the law. In California, only 3 million of the 11 million homeowners living in flood plains have insurance.
Even so, federal authorities routinely provide disaster relief for flooded homeowners without flood insurance.
Now California is thinking about reform. Its initiative parallels efforts in Washington to restrict federal disaster aid. One House proposal envisions a savings of $4 billion to $5 billion by ending federal disaster relief entirely, according to the Insurance Information Institute in New York.
Another idea, proposed by a bipartisan U.S. House task force, would impose a 1 percent surcharge on property insurance to create a $2.6 billion disaster aid trust fund for emergency relief.
Marine Hydraulics International Inc.'s future dimmed considerably in February. One month after MHI's bankruptcy filing, the Navy declined to award it the overhaul contract for the frigate Carr.
While the light may be flickering on the small ship repairer on the Elizabeth River in Norfolk, it's not out. MHI recently won a $589,400 contract from the Navy for repairs on a landing craft utility.
That contract, along with some other small jobs, has helped put employees back to work at shipyard, MHI President James Hong said. It currently employs about 175, up from 50 in mid-February.
Downtown Hampton Unlimited wants to attract tourists. Downtown property owners would be taxed between 10 cents and 20 cents per $100 of assessed value to pay for a proposed marketing campaign.
Speaking of tourists, cruises are popular. Of the 1,200 people polled by marketing firms Yankelovich Partners and Robinson Yesawich & Pepperdine Inc., 60 percent said they were interested in taking a cruise vacation in the next two years.
``Our research indicates this is a perfect time for the cruise industry to fully develop the family market,'' said pollster Dennis Marzella of the Robinson firm.
McCrory's ended a chapter in the annals of Eastern Shore retailing recently when it closed its Cape Charles store. But one question lingered. Just how old was the store?
A McCrory's spokeswoman thinks the store opened in Cape Charles in 1945, but the landlord remembered the store long before it moved down the street in the '50s.
While residents believed McCrory's store dates back to the '20s or '30s, the spokeswoman said that store must have belonged to another five-and-dime operation.
Corn producer Jimmy Carroll Jr. of Isle of Wight County plans to triple his cotton planting this year to 550 acres. He's not alone. With cotton futures fetching the highest price in more than a century, Virginia farmers intend to double their cotton crop. Equipment suppliers can savor the trend. Carroll wants to buy a $165,000 cotton harvester. by CNB