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A children's playhouse on the back side of the Cody Inn in West Duluth collapsed into a ravine during Wednesday's big storm. Only 111 property owners have flood insurance in Duluth. Bob and Jean Pedersen, owners of this property, aren't among them. (Bob King / rking@duluthnews.com)

No flood insurance? There may be other options for victims of last week's storm

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No flood insurance? There may be other options for victims of last week's storm
Two Harbors Minnesota 109 Waterfront Dr. 55616

For 50 feet or so, one side of Cody Street has simply disappeared, fallen into an embankment. Next to it is what appears to be a house propped up by a couple of two-by-fours.

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On closer look, the precarious structure is thankfully only a children's playhouse, once a pleasant amenity of the Cody Inn Apartments. But Bob Pedersen, who owns the apartments in West Duluth with his wife, Jeanne, said things weren't much better inside the real building. Tenants are going without gas, sewer, water and phone service. And there's no flood insurance to help them.

"(Insurance) won't pay for a dime," he said, adding he doesn't know how he'll pay for cleanup and repairs. "There are a lot of unanswered questions right now."

The Pedersens aren't alone. In all of Duluth, only 111 flood insurance policies have been sold, according to Kris Eide, director of the Minnesota Homeland Security and Emergency Management office.

"Who would think, when you live on a hill, you need flood insurance?" she said.

Unless a property owner has flood insurance or a rider on a homeowner's policy that covers some parts of flood damage, such as sewer backups, those with damage from last week's flood "probably won't get covered," said Rockne Johnson, an agent with American Family Insurance in Duluth.

Whether victims will get state or federal disaster aid depends on the type of emergency that's ultimately declared. But even if it is, it could take weeks to get help, and homeowners would likely see only a small amount of money.

If President Obama makes an emergency declaration for public assistance, then all federal disaster money will go to state and local governments to pay for replacing or fixing public infrastructure, such as roads, sewer and water systems and other government property.

But if the president adds a declaration for individual assistance, private property owners will be eligible for many types of help, including temporary housing, repair or replacement of damaged housing, and disaster-related medical and dental costs.

The catch, though, is that it's capped at $31,000.

"When you lose a home," Eide said, "$31,000 doesn't go very far."

It will be up to Gov. Mark Dayton to determine what type of disaster declaration to request from the president, and the process could take weeks, Eide said.

"It's all based on how does this disaster impact families and does it exceed the capabilities of insurance companies, the community and nonprofit organizations, and state and local governments to help those families recover?"

The last two times the state requested disaster funding it was denied, Eide said.

"So then we look at the programs that are available from social service agencies, and from communities and from state agencies," she said.

Many of those agencies will provide short-term relief to flood victims starting this week. The United Way's 211 service has been taking calls for assistance since the start of the floods. Those callers will be matched with individuals and organizations that have offered to help with the recovery efforts, said 211 coordinator Rory Strange.

"There are a lot of people that want to help," he said.

Even people looking for advice on how to clean up could call 211, Strange said.

While there's no short-term funding help currently available through the United Way, Strange said long-term the group is looking at creating a recovery fund.

The Red Cross Northland is also assisting with cleanup help, and case workers will soon be contacting residents who need it, according to Duluth city officials.

Property owners may also be eligible for long-term assistance in the form of tax breaks, said Carlton County Assessor Marci Moreland. Depending on the damage, homeowners could see up to 100 percent property tax relief for 2012-13.

Eide said the Federal Small Business Administration also may provide low-interest loans for business owners and families affected by the floods, while the Minnesota Housing Finance Agency also provides some disaster relief.

The Minnesota Department of Revenue provides tax abatements and credits for people who have 50 percent or more damage to their properties.

To be eligible for any aid, Eide said, people should take photographs and make a written inventory of their losses. Everything should be photographed before any repairs or removals occur so there is proof of damage, she said, whether the aid applied for is from private insurance or the government.

Forum Communications Capitol Bureau reporter Don Davis contributed to this report.

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