Your credit union may be far from the coastline, but it could soon feel the effects of recent hurricanes anyway-in the form of new building codes.
In the wake of Hurricane Andrew in Miami in 1992, Miami-Dade County instituted much tougher building standards to make the area more able to withstand a major hurricane, a building code that has spread across Florida. Experts suggest the same thing will now occur in parts of Texas, Louisiana, Mississippi and Louisiana in the aftermath of Katrina and Rita-and it could even trickle down to areas not traditionally considered to be "hurricane prone."
"The biggest impact of this could be that we see people rethinking what regions are vulnerable to hurricanes," said NewGround's Tom Auer. "In particular, I think we can expect to see some of these more stringent building codes being required further inland than before."
Indeed, the affects of Katrina were felt as far as 150 miles inland from the Mississippi coast-an area that wouldn't normally be considered to be "hurricane prone."
Moreover, even areas that clearly aren't in the path of hurricanes, such as the Midwest, for example, could see a trickle-down effect on building codes.
"Every part of the country has some potential for some sort of natural disaster," Auer noted. "The Midwest may not have hurricanes, but they do have tornadoes, for example. As the materials and methods used in areas like Miami become more widely used in the regions of the country vulnerable to hurricanes, those materials and methods will become more widely accessible elsewhere, as well."
Cincinnati-based DEI's Bill Speelman agreed, noting, "Because of the politics of all this, it is possible" that other parts of the country could adopt some of the same codes expected to be implemented along the Gulf Coast. "There's been a whole lot of finger pointing about who did-or didn't do what and how well things were planned for, and whenever you have a lot of finger pointing, that can call for an overreaction on the part of politicians who don't want anyone pointing fingers at them," Speelman added. "Even though we don't have hurricanes in every part of the country, certain disasters can and do have national implications. The Beverly Hills Supper Club fire (in Northern Kentucky in 1977 in which 165 people died) in is a perfect example. That happened here in Ohio, but it caused a national focus on emergency exits."
Plus, as research is done to make buildings more hurricane-resistant, valuable steps forward can be taken in building in general, Auer noted.
Some credit unions will also choose to voluntarily adopt tougher building standards, even if they aren't implemented in their areas.
"We have a couple of projects that are in the region affected by both storms. One is right on the edge of a zone that requires hurricane-resistant glass. It's recommended, but not required," he related. "They originally opted not to go with the special glass, but I would expect to see a reversal of that decision in light of Katrina and Rita. They're going to want the comfort of going to the next level of protection."
Both Auer and Speelman agreed it's unlikely credit unions, even in the areas most often hit by hurricanes, will start building "bunker-like" buildings designed to withstand a catastrophic Category 5 storm.
"Credit unions are not considered essential facilities, like hospitals and other emergency responders. They are not expected to be able to remain up and running in the midst of a storm," Auer offered. "There's no need to build a bunker. But when a hurricane or tornado hits, you can always tell where the [financial institutions] were-just look for the vaults. They're always still standing right where you left them, even when the rest of the town has been destroyed. I wouldn't expect credit unions to become havens for people to stay in during the storm, though."
There are a number of different building aspects that come into play when building in a hurricane zone. Concrete block construction versus wood frame, for example, shatter-resistant glass for windows, the way roofs are anchored as well as the materials used.
Both Speelman and Auer said it's hard to say for sure how building codes will change after this hurricane season-or even how long it will take. "Building codes, by their nature, are conservative, you're not going to see any loosening of codes," Auer suggested. "There's a lot of deliberating and posturing that has to be done before anything is rewritten."
But credit unions should expect to see any revisions to building codes to be "fast tracked" because of the loss of life and devastation wrought by these two hurricanes.
In most cases, tougher building codes mean more expensive buildings, but credit unions can mitigate that cost by first making sure they only build "as much building as they need," Auer said. "If a credit union was planning on building a 5,000 square foot branch, and they carefully assess how they do business and realize they could do it in 3,500 square feet, they can realize about a 30% decrease in the cost, even more if it means they can build on a smaller parcel of land."
Both design-build firms said they expect credit unions that are facing tougher building codes (and in some cases, a lot of rebuilding of existing branches that were hit by the storms), to do one of three things: temporarily hold off on building additional branches, rethink the type of branch (perhaps go with a storefront instead of a stand alone, for example) or downsize the plan to mitigate the additional cost of meeting the tougher codes.
