Southcliff Asheville— Hazardous-Land Disclosure Statement

As part of its continuing “ Dangerous Ground” landslide investigative series, the Asheville Citizen Times reported on August 30, 2009 that approximately 29% of Buncombe County, North Carolina real estate is threatened by landslide-triggering soils.

—The Buncombe County Soil Hazards Map has not been released—


Slope Movements and Slope
Movement Deposits Map


Stability Index Map


Map of Known and Potential Debris
Flow Pathways

North Carolina Geological Survey Buncombe County landslide hazard maps. Computer technology now allows developers and Buncombe County planners to evaluate occupied and vacant residential parcels for probable landslide events.

It is not known whether the principals of the Carolina Group Partners, LLC., Brad Murr, Steve Vermillion, Garland Hughes, Eric Nichols and Jeff Mathis and developers of Southcliff have been informed that all Buncombe County real property has been evaluated for hazardous-land conditions. The Southcliff Web site does not reference the completed hazardous-land real estate maps.

Disaster Maps Reveal Buncombe County Real Estate Hazards

Federal and state emergency management agencies expect disastrous events such as landslides, wildfires and flooding to impact major residential areas in Buncombe County. These forecasts have prompted the Federal Emergency Management Agency (FEMA) to require real estate risk blue prints as part of the county’s hazard mitigation planning.

The Renaissance Computing Institute (RENCI) has designed computer software that is able to locate by address all naturally hazardous real property locations. Although new to Buncombe County, these real estate risk determinate programs are in place in other multi-hazard municipalities.

Emergency personnel along with county, city and town planners were briefed in March 2009 on the use of the Buncombe County Multi-Hazard Risk Tool and its ability to generate real estate hazard/risk maps. Hazardous-land risk identification tools were installed in Buncombe County computer systems in April 2009.

Examples of Hazardous-Land Data for Buncombe County, North Carolina



Starnes Cove Landslide—NCGS—September 2004


Landslide Hazard Map—Town of Woodfin—April 2009


Landslide reports show parcel count and value for
parcels in the unstable area and the upper threshold area.

Homes in Harm’s Way— Landslide Investigations

In March 2009 two newspapers reported on the dire consequences of hazardous-land real estate development. The New York Times and the Asheville Citizen-Times found that thousands of homeowners across the county will face significant uninsurable landslide property losses.

Wildfire Threats


Wildfire Hazard Map—Town of Montreat—April 2009

Wildfire Reports show parcel count and value for parcels
at high, medium high or greater, and medium or greater
risk levels. Data compiled by the Renaissance Computing
Institute.

City of Portland—Hazardous-Land Data

Looking to buy real estate in the city of Portland? Type in an address, such as 6438 SW Burlingame Place- Hillsdale, on the PortlandMaps Web site and you will find that this property is rated for landslides, earthquakes and wildfires.


Photo/Burlingame Landslide
—The Oregonian—October 8, 2008


PortlandMaps—6438 Burlingame
Place—landslide real estate map

Why was this address chosen? There are two reasons: the first is to illustrate the sophistication of the PortlandMaps system and the second is to demonstrate the accuracy of geological findings. On the morning of October 8, 2008, a portion of the Burlingame lot collapsed and a neighborhood was devastated. The cause of the Burlingame landslide: a broken water pipe.

Southcliff

The principals of the Carolina Group Partners, LLC, should be concerned that their permit for Southcliff was granted without benefit of hazardous-land mapping.

The question is, now that they are aware of the new Buncombe County real estate risk reports, how can they protect their clients from making unwise decisions? The answer is simple: It’s called a Natural Hazard Disclosure Statement. This pre-sale document has accompanied all California real property hazardous-land transactions since 1998.

The following is a modified version of the California disclosure statement and is an example of the type of risk information that should be included on the Southcliff Web site and as part Buncombe County real estate transactions, including the Subdivision Street Disclosure Statement.

Buncombe County Real Estate—Hazardous-Land Disclosure Statement

Please be advised that you are buying real estate in a federally designated disaster-prone county.

The Renaissance Computing Institute and the Buncombe County Emergency Operations Center have researched hazardous-land data and have determined that extensive real property in Buncombe County is threatened by three expected high-impact geological events: landslides, flooding and wildfires. Every parcel in the county has been assessed for hazard extent and potential market-value loss. Information is available though various planning offices throughout the county.

Buncombe County— Landslide-Hazardous Real Estate

The decision to buy landslide-hazardous real estate should be well-considered. Flood and fire insurance is available to property owners. Landslide insurance protection is not obtainable. The inability to insure this special-risk real estate will have an adverse effect on property values and mortgage refinancing. Please seek legal advice concerning landslide liability.

The maps and reports generated by the Buncombe County Multi-Hazard Risk Tool are “best guess” estimations of probable disastrous events. Flood and wildfire risks are known through published maps available to the insurance industry. Costs to insure these properties are predicated on the level of risk.

Landslide maps, likewise, show generalized questionable building locations. Landslide propensity is only determinable by on-the-ground site surveys. These investigations should be conducted by state licensed engineers.

The Cliffs at High Carolina—Property Owners' Liability

As part of its continuing “ Dangerous Ground” landslide investigative series, the Asheville Citizen Times reported on August 30, 2009 that approximately 29% of Buncombe County, North Carolina real estate is threatened by landslide-triggering soils.

—The Buncombe County Soil Hazards Map has not been released—


Slope Movements and Slope
Movement Deposits Map


Stability Index Map


Map of Known and Potential Debris
Flow Pathways

Reporter Dale Neal suggested in his article, “Landslide hazards charted,” that these completed (authorized in February 2005) North Carolina Geological Survey maps could help persuade Buncombe County planners of the urgency of establishing meaningful steep slope regulations. It should be noted that all Western North Carolina county planners were apprised of critical-land conditions in 1998.

In his interview with county planner, Jim Coman, Mr. Neal made reference to more detailed hazardous-land maps. The Renaissance Computing Institute's real property disaster maps were given to Buncombe county planners in March 2009 —they identify and rate landslide, wildfire and flooding risks by address. This in-depth real estate risk assessment is part of the county’s hazard-mitigation planning and is required by the Federal Emergency Management Agency

When asked to explain the ramifications of these real estate hazardous-land findings for Buncombe County property owners Mr. Coman said:

Owners of existing homes in high hazard areas could call in engineers to shore up shifting foundations or take other preventive measures to protect their property.

As to landslide-hazardous developments already permitted such as the The Cliffs at High Carolina's 3,200 acre/1,300 lot subdivision Mr. Coman said:

they have a very good engineering staff, their clientele can afford the extra cost.

Mr. Coman presumes that High Carolina clients are aware of the financial risks of owning property in a hazardous-land private street subdivision.

The Cliffs at High Carolina— Disclosure of Hazardous-Land Conditions for Phase 1 Lots

The Cliffs at High Carolina Property Report—October 21, 2008— advised prospective buyers that the 99 lots covered in the document had been evaluated for landslide hazards by the Raleigh-based S&ME engineering firm. Colluvium deposits were discovered in and around the 99 lot tract but:

With respect to all lots, however, S&ME reported that it was its opinion that ‘residential structures can be suitably supported at the lots,’ and found that the identified building area for each lot was suitable as a home site.

The Cliffs at High Carolina—Subdivision Street Disclosure Statement Fails to Disclose Property Owners’ Liability for Maintenance of Roads Built on Hazardous Soils

Developers of private street subdivisions are required by North Carolina law to provide their clients with the following liability disclosure statement.

Sample Subdivision Street Disclosure Statement

Pursuant to N. C. G. S. Section 136-102.6 _______, as the Declarant of _______,
issues this statement indicating that all of the roads within_______ are private. It is the obligation of _______ Homeowners' Association, Inc. (hereafter "Association") to maintain and keep in good repairs all of the private roads in _______Subdivision. It is mandatory for all property owners in _______ to be a member of the Association and the property owners, with the exception of the Declarant, have an obligation to pay assessments to maintain the private roads. The Declarant specifically states that the streets have not been constructed in such a manner to allow inclusion on the State highway system for maintenance.

Occasionally developers will construct their private streets to meet State Highway standards but this does not relieve property owners from their obligations. The North Carolina Real Estate Commission offers the following advice regarding subdivision private roads:

However, if a developer becomes insolvent, is dissolved or dies, the owners alone will have to bear the cost unless a government agency takes control. Since there is no guarantee that any government agency will ever take control of the roads in a subdivision, owners are ultimately called upon to bear the cost of road maintenance in many situations.

Although the use of the standardized Subdivision Street Disclosure form as a conveyance document for hazardous-land subdivisions has yet to be adjudicated this does not relieve developers from providing their clients with all material information.

Jim Anthony, developer of The Cliffs at High Carolina, should be required to include a "Fair Warning" addendum on the Subdivision Street Disclosure Statements and in the federal Property Report. Property owners' liabilities linked to The Cliffs at High Carolina private road system are significant and Mr. Anthony should clearly state them. Before assuming responsibility for The Cliffs at High Carolina streets, property owners should be advised of the following:

This subdivision’s roads were built on likely unstable soils. Landslides and erosion are recognized chronic hazards above a 15% slope. Soil assessments for this subdivision can be found at the Buncombe County Soil & Conservation Office. Buncombe County did not require geotechnical, hydrologic or soil studies for this subdivision. Should this subdivision’s roads be damaged by predictable geologic events, the members of the homeowners’ association will be liable for all repairs.

For an example of the costs of assuming ownership of roads built on colluvial material, please see The Horseshoe Cove Landslide Report—Maggie Valley, North Carolina.

Western North Carolina Landslides May Be Triggered by Heavy Rainfall

National Weather Service Bulletin—September 21, 2009

This National Weather Service notification serves as warning that Western North Carolina landslides and slope failures are expected events during periods of heavy rainfall.

The recent heavy rainfall across the area from Macon County to Henderson County North Carolina has increased the risk of slope failures and landslides if more heavy rain develops across the southern mountains today. An additional two or three inches…if it falls in a of period of one or two hours…could be enough to trigger slope movements…especially where hillsides have been modified by human activity.

In September 2004 Western North Carolina was in a state of emergency after landslides caused loss of life and widespread property damage.

Western North Carolina Real Estate—Hazardous-Land Subdivisions

A little over three years ago a road-building crew caused a massive landslide on Eagles Nest Ridge in Haywood County. Luckily, no homes were in the path of what Jeff Schmerker called “A Whopper of a Slide.” The Mountaineer—September 12, 2006



Photo 1-View looking up the track of the August 31, 2006 embankment failure-debris flow from the development road near lot 107.
Photo 2-View looking downslope at the debris deposit and damage to lot 107
Photo 3-View of cracks in embankment extending northeast from the head scarp of the August 31, 2006 embankment failure-debris flow
Photos compliments of the North Carolina Geological Survey

The Cascades Subdivision Landslide

The Cascades Subdivision landslide occurred in a 700-acre development which was being built by Maurice Wilder of Clearwater, Florida.

After the landslide Dennis Franklin, contractor for the project, notified county officials and instituted temporary measures to stabilize the area. Marc Pruett, Haywood County’s erosion control supervisor, said that without notification he probably would not have known about the slide since no homes or residents were in danger.

Maggie Valley engineer Kevin Alford, who investigated the slide for a Cascades property owner, said that the failed section of the road bed occurred because:

The upper road was built out of shot material (from) where they had to blast the roadway in there. It got too heavy. The sliding material acted like a bulldozer, scouring the slope of almost all soil and vegetation. It wiped out a path down to bedrock. It was like an elliptical -shaped bulldozer. It is an amazing thing when you see that kind of material go down the mountain. When you get up in the mountains and start building roads, there are good ways to build roads and bad ways to build roads. In a situation like that I think it would have been reasonable to do subterranean work to find out what was there. When you have a large amount of uncompacted rock fill that gets a lot of water in it, you have potential for slope failures. There is still more material up there, so it could happen
again.

North Carolina Geological Survey’s Findings

Geologists investigating the landslide site found that the collapsed slope embankment was composed of highly unstable woody debris and graphitic-sulfidic bedrock fragments. Rain on this weak, improperly-constructed, roadbed probably precipitated the landslide.

During the course of their survey the geologists determined that the still standing ~ 300 foot long road embankment showed evidence of additional failures. They warned that if the fragile embankment is not properly stabilized, this land mass will pose a future threat to public safety. Recommendations to the developer included a professional investigation of the failed site in conjunction with extensive and expensive stabilization measures or removal of the remaining roadbed. It is unknown whether Mr. Wilder followed the safety recommendations outlined by the North Carolina Geological Survey. Mr. Wilder, along with all other developers conducting business in the state, are left to their own best judgment on landslide remediation.

In their assessment report the NCGS referenced other Western North Carolina landslides caused by contractors' use of graphitic-sulfidic road fill.

When developers build roads in a subdivision or planned community North Carolina law stipulates that they declare their subdivision roads either private or public. Mr. Wilder's roads were recorded as private. If private, property owners are required to sign the following liability document at time of sale:

Sample Subdivision Street Disclosure Statement

Pursuant to N. C. G. S. Section 136-102.6 _______, as the Declarant of _______,
issues this statement indicating that all of the roads within_______ are private. It is the obligation of _______ Homeowners' Association, Inc. (hereafter "Association") to maintain and keep in good repairs all of the private roads in _______Subdivision. It is mandatory for all property owners in _______ to be a member of the Association and the property owners, with the exception of the Declarant, have an obligation to pay assessments to maintain the private roads. The Declarant specifically states that the streets have not been constructed in such a manner to allow inclusion on the State highway system for maintenance.

No Escape Clause

If the Wilder landslide had occurred after lots had been sold The Cascades property owners, without exception, would have been obliged to repair the damage.

The use of the Subdivision Street Disclosure Statement as a conveyance document for streets in a hazardous-land subdivision has not been legally challenged so property owners remain uninformed about the financial risks. The following material information is omitted on Western North Carolina Mountain Subdivision Street Disclosure Statements:

—Land in this subdivision is steep slope. Soils above a 15% grade are generally not “suitable” or “poorly suited” for residential development— “Some are too unstable to be used as a foundation for buildings or roads.” References: Western North Carolina Soil Surveys/North Carolina Geological Survey.

Horseshoe Cove Subdivision Landslides

The Horseshoe Cove Subdivision landslides provide an example of the financial consequences of sharing ownership of roads built on unstable soils. Below are some photographs of the damage caused to the subdivision's roads. Engineering evaluations commissioned by the property owners found that their subdivision had been built on a hazardous-land tract. The Horseshoe Cove Subdivision was designed and developed by Don Condren. Mr. Condren is currently doing business in Jackson County.



Post-development hazardous-land determination did not invalidate the terms of the Horseshoe Cove Subdivision Street Disclosure agreement. Collectively the Horseshoe Cove property owners paid $300,000 to repair roads and drainage. The preventive landslide techniques (Costs: $2,868,000-$5,230,000) recommended by McGill engineers were not pursued.

The Federal Emergency Management Agency

Members of various influential groups, such as the Association of Realtors and the Home Builders Association have suggested that landslides and other hazardous-land conditions are immaterial threats to property owners.

Federal officials disagree.

Although the Federal Emergency Management Agency cannot force states to provide hazardous-land real estate disclosure they are requiring all disaster-designated counties to evaluate and assess all real property for landslides, wildfires, and flooding as part of their hazard mitigation plans. These unpublicized real estate risk compilations are under the purview of county planning boards. Ask to see them.

Grey Rock at Lake Lure— Property Owners' Liability

Foreclosure Lot 206 $5,000


Foreclosure Lot 213(2A) $8,900


Photos— Grey Rock at Lake Lure roads adjoining the above lot sales. Under Land Resource, LLC ownership Grey Rock lots were priced from $200,000-$700,000.

The failed Grey Rock at Lake Lure development project has new owners. Jim Hester, editor of The Mountain Breeze, reported that a development group called Catalyst had purchased all of the Grey Rock inventory lots and will begin to reestablish roads in Phase 1 and 2 of the subdivision. When land sales are initiated, prospective buyers will be given the following required liability statement:

Sample Subdivision Street Disclosure Statement

Pursuant to N. C. G. S. Section 136-102.6 _______, as the Declarant of _______,
issues this statement indicating that all of the roads within_______ are private. It is the obligation of _______ Homeowners' Association, Inc. (hereafter "Association") to maintain and keep in good repairs all of the private roads in _______Subdivision. It is mandatory for all property owners in _______ to be a member of the Association and the property owners, with the exception of the Declarant, have an obligation to pay assessments to maintain the private roads. The Declarant specifically states that the streets have not been constructed in such a manner to allow inclusion on the State highway system for maintenance.

The North Carolina Real Estate Commission Web site offers the following advice concerning property owners’ liability linked to Subdivision Street Disclosure Statement:

Who is responsible for road maintenance in a subdivision or planned community?

Until responsibility for road maintenance is lawfully transferred to a municipality or the North Carolina Department of Transportation, either the developer or the owners will be responsible. However, if a developer becomes insolvent, is dissolved or dies, the owners alone will have to bear the cost unless a government agency takes control. Since there is no guarantee that any government agency will ever take control of the roads in a subdivision, owners are ultimately called upon to bear the cost of road maintenance in many situations.

Before I buy, will I know who is responsible for the road maintenance?

Not necessarily. Since October 1, 1975, developers and sellers of certain residential subdivision lots have been required by law to give the first purchaser of each property a Subdivision Street Disclosure Statement containing important information about road ownership and maintenance responsibility. However, the application of this law is quite limited, so it is very important that you inquire into the status of roads in the subdivision and find out who is responsible for their maintenance.

Hazardous-Land Subdivisions

Much of the Grey Rock at Lake Lure development site is steep slope. The generally accepted definition for steep slope is land above a 15% grade. Landslides and erosion are recognized common occurrences above this threshold and even with the best engineering techniques roads built on this terrain are inherently unstable and expensive to maintain.

The Grey Rock at Lake Lure building site is geologically hazardous but this information will not be revealed on the Subdivision Street Disclosure Statement. It has not been determined whether the Subdivision Street Disclosure Statement, as written, is a valid conveyance document for hazardous-land subdivisions so purchasers should be wary.

Grey Rock at Lake Lure Feasibility Studies

Initial planning for Grey Rock roads, under Land Resource, LLC ownership, would have required soil, hydrologic, and geotechnical analyses. These reports should be available for review. Caveat: The 1997 Rutherford County Soil Survey determined that soils on most steep slopes were not “suitable” or “poorly suited” for residential development— “Some are too unstable to be used as a foundation for buildings or roads.”

The decision to sign the Subdivision Street Disclosure Statement and join the Grey Rock at Lake Lure Homeowners’ Association should be taken under advisement. For an example of the financial consequences of sharing ownership of roads in a hazardous-land subdivision, please read the Horseshoe Cove Landslide Report.

Hazardous-Land Subdivisions—Jackson County, NC

September 15, 2009

Linda Cable, Jackson County Planning Director
Jackson County Planning Office
Suite A-258
401 Grindstaff Cove Road
Sylva, NC 28779

Dear Ms. Cable:

On May 6, 2003 roads designed and commissioned by Don Condren, a Haywood County developer, were damaged by landslides. These events raised the question of property owners' liability for roads in hazardous-land subdivisions. Horseshoe Cove, the subdivision under discussion, is located in Maggie Valley, North Carolina.

Horseshoe Cove property owners did not learn until after the fact that Mr. Condren had chosen a hazardous-land tract for their subdivision.

As you know, post-development, hazardous-land determination is of no consolation to aggrieved property owners. Under North Carolina law the responsibility for road maintenance and repairs is transferred from the developer to property owners at time of sale through a document titled the Subdivision Street Disclosure Statement.

Horseshoe Cove property owners, facing costly long-term litigation and the threat of developer's bankruptcy acknowledged responsibility and paid $300,000 to restore their roads. The Horseshoe Cove Subdivision remains at risk: the multi-million dollar landslide stabilization techniques recommended by McGill engineers were not undertaken.

Mr. Condren is currently doing business in Jackson County and received recommendation for his Rolling Hills Estates Major Subdivision application on September 11, 2008. In summary, the Planning Board Minutes show:

—Mr. Condren’s proposed, average 21% slope, subdivision construction site is exempt from landslide prevention studies mandated by the Mountain and Hillside Development Ordinance.

—The Rolling Hills Estates Homeowners’ Association has been established and is recorded-deed book 1747 page 545.

— Property owners will be advised on their Subdivision Street Disclosure Statements that they will be legally responsible for costs pertaining to roads and common areas.

The North Carolina standardized Subdivision Street Disclosure form as shown below may be a suitable conveyance document for no-risk building sites, but it is not an acceptable liability disclosure statement for Jackson County’s hazardous-land subdivisions.

Sample Subdivision Street Disclosure Statement

Pursuant to N. C. G. S. Section 136-102.6 _______, as the Declarant of _______,
issues this statement indicating that all of the roads within_______ are private. It is the obligation of _______ Homeowners' Association, Inc. (hereafter "Association") to maintain and keep in good repairs all of the private roads in _______Subdivision. It is mandatory for all property owners in _______ to be a member of the Association and the property owners, with the exception of the Declarant, have an obligation to pay assessments to maintain the private roads. The Declarant specifically states that the streets have not been constructed in such a manner to allow inclusion on the State highway system for maintenance.

Upon your advice and recommendation Jackson County passed the Hillside and Mountain Development Ordinance in 2007. This urgency measure stated that much of the county’s developable land was inherently unstable and thus hazardous.

With that said, Jackson County Subdivision Street Disclosure Statements are not comprehensive disclosure documents. A material fact—hazardous-land designation— has been omitted. The Jackson County Planning Board can correct this error by requiring the inclusion of a "Fair Warning" addendum on the disclosure statements. Property owners' liabilities linked to private road ownership are significant and developers must clearly state them. Before assuming responsibility for developers' roads, property owners should be apprised of the following:

This subdivision’s roads were built on likely unstable soils. Landslides and erosion are recognized chronic hazards above a 15% slope. Soil assessments for this subdivision can be found at the county Soil & Conservation Office. Jackson County did not require geotechnical, hydrologic or soil studies for this subdivision. Should this subdivision’s roads be damaged by predictable natural occurrences, the members of the homeowners’ association will be liable for all repairs.

The absence of material information on Jackson County Subdivision Street Disclosure Statements presents unconsidered liability issues. If the Subdivision Street Disclosure Statement is found to be an invalid conveyance document, what legitimate claims could injured parties bring against those involved in the development and sale of said properties?

Thank you for your interest in this matter.

Lynne Vogel
WNCSOS
232 Wonderly Lane
Mars Hill, North Carolina 28754