First Superstorm Sandy home buyout set to close in New York

By Barbara Goldberg

New York - Even when Superstorm Sandy killed their neighbors and flooded their house, Frank and Mary Lettieri vowed to stay in the Staten Island, New York, home where they raised five children.

But with a popular home buyback program set to close on its first house on Thursday and nearly the entire neighborhood fleeing, the self-declared holdouts are starting to blink.

The voluntary buyback program spearheaded by New York Governor Andrew Cuomo would replace storm-ravaged neighborhoods with open land that could bear the brunt of future storms, and most residents are accepting the state's offer to pay full, pre-storm price and moving on.

Those determined to stay are beginning to wonder what will happen to them when everyone else around them is gone.

"After everybody leaves, they start knocking down houses and now you're here. It snows. Are they gonna plow the street?" asked 63-year-old Frank Lettieri.

His cozy yellow house on Fox Beach Avenue, one block from the water's edge, is surrounded by boarded-up bungalows and "No Trespassing" signs.

On Oct. 29, 2012, Sandy devastated New York, New Jersey and other parts of the East Coast. The historic storm killed at least 159 people, and damaged or destroyed more than 650,000 homes.

The storm surge from Sandy slammed Fox Beach Avenue, a warren of modest homes with cement stoops, tossing cars into tiny front yards and filling living rooms almost to the ceiling. All three people killed in Oakwood Beach died in their flooded basements on Fox Beach Avenue.

In New York, the state is offering a $400 million buyback program for flooded communities that Cuomo said was meant to return "some parcels that Mother Nature owns." The first home deal is set to close on Thursday in Oakwood Beach, but state officials declined to disclose any price information.

It's one of the 418 homes that were invited to take the buyout, said Barbara Brancaccio, spokeswoman for the Governor's Office of Storm Recovery. About 300 owners - some owning multiple properties - have filed applications, she said.

A similar $300 million program in New Jersey, called "Blue Acres," is expected to finalize its first house deal later this month, said Bob Considine, spokesman for the New Jersey Department of Environmental Protection.

Both buyback efforts piggyback on an existing Federal Emergency Management Agency (FEMA) program.

The programs would render New York's Oakwood Beach on Staten Island and central New Jersey's Sayreville and South River into the nation's newest ghost towns. Instead of tumbleweeds rolling down empty streets, flooded stretches of wild grass would be traversed by Great Egrets and Canada Geese.

The Lettieris live in the Fox Beach neighborhood, where realtor-turned-community-organizer Joseph Tirone Jr. has managed to get all but three of 185 households to agree to take the buyout.

The estimated pre-storm value of the average home in Fox Beach is $375,000, and each buyback offer is based on the sale price of a comparable home before October 2012, Tirone said. To sweeten the deal, Fox Beach residents were offered a 10 percent bonus because their neighborhood was declared an "enhanced area" that if returned to nature could help protect the rest of Staten Island.

"I never thought the entire neighborhood would get a buyout. I was really shocked," said Mary Lettieri, 60, a nursing home aide.

Her husband Frank, a nurse in a dialysis center added: "It took on a life of its own. Everybody jumped on board."

He said he quit attending buyout meetings because they were "too negative."

"They're just bringing up everything, the fires, the fact that people died," he said.

Sandy killed the Lettieris' next-door neighbors, a father and one of his twin sons found dead in their home which has since been demolished. Further down Fox Beach Avenue, another man drowned in his basement.

With several beaches around Staten Island being rebuilt and strengthened with manmade ledges, Mary Lettieri is worried her local beach may be neglected, causing water to funnel into Oakwood Beach, the weakest point.

"If they make it impossible to live here, then what do you do?" she said.

Just a block from the Atlantic Ocean, the house they bought in 1987 has been flooded before, including in 1992 when they spent $90,000 to make it livable again, Frank Lettieri said.

"You look at the ocean and you look at our house and go, 'Whoa... That is mighty low,'" he said.

The Lettieris have nearly paid off their mortgage and are near retirement. Since Sandy, they spent $138,000 to rebuild, including $84,600 from the National Flood Insurance Program, a $29,000 Small Business Administration loan and their own money.

When Cuomo announced in February 2013 that the buyout plan would encompass the entire neighborhood, the Lettieris were just a month shy of moving back into the rebuilt home.

"We've done all this to stay," Mary Lettieri said, but said the home feels "temporary."

She said she hesitates to hang pictures on the wall and her husband is not keen on tending to the weedy overgrown lawn.

Besides, the memories of her dead neighbors haunt her. "I feel bad about next door so I don't even know that I like the backyard so much anymore," she said. (Additional reporting by Hilary Russ; Editing by Diane Craft)