Update on progress on the pyrite resolution process
Minister for the Environment, Community & Local Government Mr Phil Hogan TD speaking in Ashbourne today provided an update on the pyrite resolution process. He said: “In September 2011, I established the Pyrite Panel to help identify a way forward for homeowners suffering from pyrite damage. This was yet another problem that had I inherited from the previous Government. In establishing the Panel, while I was cognisant of the fact that the issue was essentially a civil matter and the State was not liable, I was nevertheless determined to facilitate a solution for homeowners. At the time it was acknowledged that the pyrite problem was very complex and a solution would be difficult.”
Since then Minister Hogan has overseen the Roadmap to moving forward and the first stage in this process was the publication of the report of the Pyrite Panel. The Report (published July, 2012) contains 24 recommendations aimed at helping stakeholders reach a resolution to the complex pyrite problem. “I moved quickly on the Report, engaging initially with all of the main stakeholders for their views on how the recommendations could be expedited. Arising from extensive discussions over the latter part of 2012, in particular with the Construction Industry Federation, the Irish Concrete Federation, HomeBond and the Irish Banking Federation, an almost universal acceptance was reached that a remediation process must be put in place which does not involve affected homeowners meeting the costs,” added Minister Hogan.
Minister Hogan established a Pyrite Resolution Board (in December, 2012) to oversee the implementation of a comprehensive remediation scheme for private dwellings affected by significant pyritic heave. Furthermore, he engaged with the Irish Banking Federation and the relevant Banks to secure agreement in principle to provide up-front funding of €50 million for a remediation scheme. It is proposed that the loan from the financial institutions will be remunerated from a mandatory levy to be imposed on the quarrying and insurance sectors. The Minister, in consultation with the Attorney General’s Office and the Minister for Finance will bring forward the necessary legislation in support of these levies. Minister Hogan will bring forward proposals shortly. While the imposition of a levy on the quarrying and insurance sectors is not in any way pointing the finger of blame at those sectors, it continues the established principle of industry paying for problems that have arisen within the sector, as happened in the motor industry and the travel trade.
The Pyrite Resolution Board held its first meeting on 25 February and also met recently with the Joint Oireachtas Committee.
The Minister for Finance announced that homeowners who could show that their homes had been subject to significant pyritic heave would be exempt from the Local Property Tax. Section 3 of the Finance (Local Property Tax) Act 2012 provides the framework for exemptions from the Local Property Tax for dwellings where significant pyrite damage has been confirmed by way of a certificate issued in accordance with a methodology for the assessment and testing of hard-core in dwellings to establish the presence of significant pyrite damage.
The methodology and the form of the certificate are to be prescribed by regulations made by the Minister for the Environment, Community and Local Government. These regulations are currently being drafted. The regulations must be prepared in accordance with the standard that has been developed by the National Standards Authority of Ireland (NSAI), namely IS 398 for Reactive Pyrite in sub-floor hard-core material – Part 1. This standard provides guidance on the visual condition assessment, sampling regime and testing to be carried out to conform the existence of significant pyrite damage. The standard must be used for all assessment and testing undertaken from the date of its publication.
Homeowners can claim an exemption for three consecutive liability periods commencing on 1 May 2013 (liability for 2013) or 1 November 2013 (liability date for 2014) if they get the relevant certificate before 31/12/2013 and make an election in writing to the Revenue Commissioners on or before 31 January 2014 specifying one of those dates.
Pyrite Resolution Board
The Pyrite Resolution Board comprises John O’Connor (Chair), Caroline Gill, Paul Forde, Sean Balfe and Matt Gallagher (Construction stakeholders nominee.) The Board have thus far made good progress on scoping the proposed remediation scheme and on the terms and conditions, including eligibility criteria that will apply.
The Housing Agency is assisting the Board in developing a website which will include an online application process. The Board hopes to have the initial phase of the website completed in the next three weeks and to be in a position to upload all the relevant documentation on the scheme to the site as soon as the documentation is finalised, sometime in April. The online application process will take a further few weeks, it is hoped to have the system ready by mid-May.
A not-for-profit entity to be known as Pyremco will be set-up by the 3 main construction stakeholders, namely Construction Industry Federation, Irish Concrete Federation and Homebond. The Pyrite Resolution Board will sign a Memorandum of Understanding or similar legal agreement with Pyremco.
The Resolution Board have outlined the scope of the scheme and on eligibility criteria. The scheme will apply to:
(i) dwellings constructed/registered in the period 1997 -2009 in the five local authority areas identified in the pyrite report,
(ii) dwellings certified in accordance with the NSAI standard as having significant pyritic damage,
(iii) dwellings purchased and occupied and not applicable to unsold dwellings owned by developers/builders,
(iv) Homeowners who have no other avenue for redress but excluding dwellings where remediation work has already been undertaken.
Costs to be covered
(i) building condition assessment (i.e. visual inspection) with the application for remediation to the PRB. Indicative costs for such an assessment are €600. However, an allowance, subject to a maximum limit, will be recouped where it is subsequently established that the dwelling is subject to significant pyritic damage,
(ii) Sampling, testing and categorisation. These costs will be funded through the remediation scheme once your dwelling has been confirmed as having significant pyritic heave,
(iii) All activity associated with remediation work, including preparation of work plan, tendering, commissioning of works, oversight/monitoring of works, snagging, certification and sign off,
(iv) A reasonable allowance for furniture removal, storage and accommodation.
Applications will be made to the PRB and it will decide eligibility on the basis of criteria to be finalised by the board.