WNPR

Eastern Connecticut Lawmakers: Crumbling Foundations Must Not Be Forgotten

May 23, 2017

Homeowners whose houses are suffering from crumbling foundations say their plight must not be forgotten in the midst of the state's budget crisis. About 500 homes, mostly in the east of the state have been identified as suffering from the problem, which stems from a corrosive mineral mixed into the concrete. But tens of thousands of homes may eventually be affected. 

Steven Werbner, the town manager of Tolland, said the problem will only get worse if the state doesn’t act quickly.

"There are only so many homes that can be repaired in the course of any one year. If we allow this problem to accumulate to the point in time where we have 500, 700, 800, 1,000 homes, it won't be possible to make the corrective actions necessary in any sort of organized fashion," Webner said.

The Capital Region Council of Governments has asked for a comprehensive testing program to discover the true extent of the issue, and the establishment of a state relief fund to offer financial assistance for homeowners.

State Representative Tom Delnicki from South Windsor pointed out the potential risk to the banking industry statewide if homeowners decide to walk away from mortgage payments on now-worthless homes. "This is a problem that the legislature needs to take action on, in some form, this year," he said.

Meanwhile, the National Taxpayer Advocate has sent a request to the IRS that homeowners suffering from crumbling foundations be allowed to apply for federal tax relief.

The work to remediate the foundations could cost at least $150,000 per home, and is not covered by homeowners insurance.

Taxpayer Advocate Nina Olson gave testimony before the U.S. House Committee on Ways and Means Friday.

"'I've been aware of this problem, and had my staff attorneys meet with chief counsel attorneys of the IRS to look at the law pertaining to casualty loss deductions and how it could apply in this instance," she said. "Just this week we submitted, to the IRS chief counsel, a request for priority guidance -- that they put this issue on their priority guidance plan."

Olson was responding to a request from Connecticut Representatives John Larson and Joe Courtney.