By DAVID NAHAN/Sentinel staff
OCEAN CITY – Ocean City Council voted 5-2 to approve a loan indemnification with Ocean Aire Condominiums to get the 52 units raised above flood level with a $3 million government grant.
Council Vice President Michael DeVlieger and Second Ward Councilman Tomaso Rotondi voted no, saying the burden should remain on the condominium association, not the city.
The Federal Emergency Management Agency (FEMA) approved a $3 million grant for the condominiums with Ocean City as a sub-grantee.
Ocean Aire Condominiums includes seven two-story buildings on West Avenue at 43rd Street. In late May, Ocean City Council approved a $3 million bond to raise them because they are categorized as severe repetitive loss structures so the federal government would fund lifting them above the flood elevation.
During Superstorm Sandy in 2012, there was two feet of water in the ground-floor units.
When council approved the bond, Council President Bob Barr said, “This is an example of multiple levels of government working together to make something good happen.”
At the July 22 meeting, city solicitor Dorothy McCrosson said the resolution authorized the mayor and chief financial officer to sign an indemnification agreement, rather than a loan agreement, to assure repayment of any portion of the grant money used to elevate the condominiums.
Council members Karen Bergman and Keith Hartzell supported the resolution.
Bergman said she knows it is difficult to get 52 condominium owners to agree, but that she “firmly believes this project needs to happen. They’re getting hammered by floods.”
DeVlieger said he believed the burden should be on the condominium association members who wouldn’t sign off on the project.
McCrosson said the city would be reimbursed for any costs, including interest or legal fees, “anything the city is out of pocket for.”
“Something like this is done by the federal government because it is going to save taxpayers money,” Hartzell said. “It would behoove us when federal government says it will help us, we should say yes.”
He added that McCrosson’s plan was “well laid out” and he agreed that what Bergman said “makes a lot of sense. There is a benefit to the town.” He called it a win-win.
“The condo association gets a benefit but we do too.”
Councilman Pete Madden said it was a good public-private initiative.
Chief Financial Officer Frank Donato said the money doesn’t come out of the city’s budget and the city also has oversight. There will be a management company in place.
“If the job is not going well,” Hartzell asked, “can we stop it?”
“Controlling the money is controlling the job,” Donato replied.
Bergman, Hartzell, Madden, Barr and Jody Levchuck voted in favor.