Jackson County Judge Harris on Stafford vividly remembers New Year’s Day 2004, when a small electrical fire broke out in a county service building. It was, at first, a small fire, only affecting a 24x24 space – just one office in the juvenile probation department. No one was in the office at the time of the blaze.
Stafford wishes that was the end of the story. U nfortunately it was not. The flames heated up the tar roof, causing it to liquefy. The tar, as it came down, caught fire and sent billows of black smoke throughout the building. The fastmoving North wind fanned the smoke, carrying it to other offices housed in the building – the library, the health department and adult probation. In the end, the event cost the county more than $1 million — mostly from smoke damage to countless documents, library books and equipment, as well as getting the building up to code. The county had a secret weapon, though — they had recently appraised all their buildings and bought full coverage insurance. After a year of construction, county employees were back working in the service building.
Not all counties have the foresight that Jackson County had. A new Texas Association of Counties Risk Management Pool initiative starting this summer aims to change the way county buildings are appraised and insured. The Property Appraisal Program is free to Pool members who participate in the property coverage.
In the past, members simply produced a written “agreed amount statement” signed by the county and the Pool in order to insure county-owned buildings. There was no appraisal and no true sense of what the building would actually cost to replace — let alone historically reproduce. However, a recent decision by the county officials on the Pool’s board to change re-insurers made it mandatory for members to insure their county buildings at 100 percent replacement cost.
“Our goal is to make sure the counties are covered at the true cost to rebuild the buildings if they are destroyed,” said Jennifer Hall, deputy director of program administration for TAC. “If the counties have not kept up with the rising cost of labor and construction, they might find that their scheduled insurance only covers half of what is needed.”
Besides ensuring that counties have enough coverage, the Property Appraisal Program provides a few other benefits, Hall said.
“Some county buildings are valued at more than is necessary. So we may find some counties that save money in this process,” she said. “Inspectors in the past have also found buildings that were not even listed (on the county’s coverage documents). So, in some cases counties have accidentally overlooked certain buildings.”
Hall cited decreased insurance costs for the entire Pool as another benefi t of the Property Appraisal Program. She explained that in the past, reinsurance companies fi lled in unknown values by using average calculations. now, if entities do not know the answers regarding their insured properties, reinsurance companies put in the highest risk estimate.
An added benefit for Pool Members is choosing to have historic county buildings appraised for historical reproduction costs, along with the functional replacement costs.
“Some counties have historical landmarks or museums and they might want to do a historical reproduction, not just a functional replacement rebuild,” said Hall. “If that’s the case, we can look at their building and assess the cost using marble like the original or the skilled masonry work that goes into it.”
newton County Judge Truman Dougharty knows well the trials and tribulations of accurately reproducing a historic county gem after a disaster. The newton County courthouse, originally built in 1903, was one of the town’s only tourist sights. Busloads visited the courthouse during the Christmas season to look at the Christmas lights. But in August 2000, faulty attic wiring completely devastated the 97-year old building.
“After the fire I held a straw poll at the chamber of commerce,” said Dougharty. “It was overwhelmingly in favor of making the courthouse the way it was. The courthouse was our identity.”
unlike Jackson County, newton County was not adequately covered. Prior to the 2000 fi re, the county had added more insurance to cover the building, bringing the insurance total to $2 million. But the destruction to the building was estimated at $6 million — leaving a hefty shortfall.
So after deciding to re-build rather than replace with a cheaper, modern structure, the county went to work raising donations and applying for grants from the texas Historical Commission. Eventually with funds cobbled together from insurance, the state agency and donations, newton County was able to start construction. nine years later, the courthouse is still being re-built.
The bell tower, the distinguishing feature of the courthouse, is back up. But according to Dougharty there is a lot more work to do on the inside. In a weary tone, he cautioned counties that old courthouses and history are hard to replace.
“Take the time to get the right insurance for your buildings,” he said. “With this program you will know your coverage. You will know what you have in the case of an unforeseen event and it won’t devastate you.”
The new Property Appraisal Program not only takes aim at fully insuring buildings at replacement cost, the program also includes the cost of office equipment found in county offices. When the Jackson County fire broke out in 2004, computers and books were not the first things on Judge Stafford’s mind. That quickly changed.
“There was smoke residue in everything. We had to replace all the computers, clean all the duct work in the air conditioning unit, clean every page of every book in the library,” Stafford said. “If we did not have proper insurance levels, we could not have afforded the professional cleaning and restoring of documents or we would have had to raise taxes.”
Newton County also spent a significant amount of money and time recovering water-soaked documents recovered from the fire. “When you think of a fire you immediately think of replacing the building. But you need insurance to cover (county) documents,” Dougharty said. “We spent around $100,000 on documents so they would not mold and to get out smoke. You have documents in the courthouse that are hundreds of years old.” On N ew Y ear’s Day 1993, the Hill County courthouse burned to the ground. An electrical fire had broken out in the attic space above the third floor and every fire department in Hill County was called to the scene, as well as fire departments from surrounding counties. But by the end, only walls remained where a historic courthouse once stood. It could have been worse: the county’s infrastructure meant that they did not lose numerous important records; all documents were housed in secure vaults in the county clerk’s and district clerk’s offices. But the damage to the structure was devastating. Just like N ewton County, Hill County was inadequately insured. They still decided to forego a modern, cheaper structure and instead went to work building a courthouse similar to the original. Unlike Newton County, however, Hill County took the issue to the polls and passed a $2 million bond in 1997.
While Hill County Judge Justin Lewis firmly believes the funds to replicate the courthouse are necessary, he does admit this tax burden discourages him from other initiatives.
“Any time a small county has a debt load, you have to be cautious when considering any future plans that might increase the citizen’s taxes,” Lewis said.
Even Jackson County ran into some obstacles during the reconstruction phase, despite fully insuring their buildings and not having to raise taxes. Fire and safety codes had changed since the original building was erected, for example. To meet the code, hallways had to be shortened, fire walls were installed in the ceilings and floor tiles containing asbestos were removed.
Stafford stressed the need to be prepared for catastrophic events and the hidden costs that are sometimes hard to predict. In Stafford’s mind, setting aside budget for insurance is a must on a county’s to-do list.
“Insurance should be a part of your maintenance program. It’s as important as making sure your air conditioning is working,” Stafford said. “If you are a fiscally conservative county like we are, you don’t have excess office space. You have to run lean, keep everything in shape and working at all times.”