Credit Unions in Damaged Florida Gradually Recovering; Damage Assessments Continue

TAMPA, Fla. – Hurricane Charley’s course was unpredictable right up until it hit land, which was good news for some credit unions, but very bad for others. Credit unions in the Tampa-St. Petersburg metropolitan area experienced both relief and alarm last week. Relief that Charley, a compact category four storm, missed their corporate headquarters but alarm as it plowed a diagonal southwest-northeast course through the center of the state, severely damaging many communities and leaving many credit unions branches initially unable to open. “Make no mistake,” said Mark Ivester, vice president of communications for the Florida Credit Union League, “when we called some of these credit unions we expected to hear that their former branches were no longer there. That they are still there is nothing short of amazing.” Hurricane Charley, which achieved its strong category four rating right before it hit land, had been on a track for the Tampa – St. Petersburg area, a fact which led many credit unions in the two cities, along with credit union card firms PSCU Financial Services and Card Services for Credit Unions to close and evacuate their offices on August 13, the day the storm hit. But instead the storm came ashore at Port Charlotte, roughly 71 miles south of the Tampa-St. Petersburg area, killing at least 19 people and severely damaging Port Charlotte and communities in Punta Gorda and Fort Myers. It then cut a swatch running northeast, through Orlando and to the state’s Atlantic coast before turning north. Once credit unions in the Tampa area realized that their corporate headquarters had been spared they swung into action to try to assess the damage to their branches and to their members, a task significantly complicated by downed power lines, downed telephone lines, downed cell phone towers and, in many areas, even downed or vanished street signs. “We have been at this all weekend and it has been rough going,” said Tom Dorety, CEO of the $4.3 billion dollar Suncoast Schools FCU. Suncoast branches in Port Charlotte, Punta Gorda and Wachula were without power as of the morning of August 16, two days after the credit union hit and, most concerning to Dorety and other credit union leaders, a significant number of credit union employees remained among the missing. In the end the employees, a number from Suncoast Schools and two from the $207 million Florida Central Credit Unions, turned up. The employees reported their communications had been broken by the lack of phone lines and, in some cases, an inability to easily get out from the places where they had ridden out the storm. Teams of other employees sent out to check on missing employees occasionally could not even find where they were supposed to be since so many street signs had been blown away. But as with many such storms, not everyone faced the same impact. The storm’s sudden veering into land caught many, including many fleeing from the Tampa- St. Petersburg area, off guard. Sue Chrzan, spokeswoman for CSCU, the association of credit unions that process their card transactions with Certegy, had decided to move her kids and another family member to a relative’s house closer to Orlando believing she was missing the storm. But when she arrived she soon discovered that they had moved into the very path of the hurricane while, back in the Tampa area, her home didn’t even get any rain. PSCU, the card processing cooperative for 500 credit unions that process with First Data, enacted its business continuity plan on August 12 and switched all its operations to its Phoenix, Arizona, office, only to find that they were able to bring the operations back online in St. Petersburg in time for Monday morning. As of press time, the Florida Credit Union League and various credit unions which had working phones reported fairly minimal building damage overall, in that none of their buildings had been completely destroyed. Dorety reported that his credit union’s Port Charlotte office was still there but had taken some water damage, flooding and broken windows. He attributed the building’s survival in part to it being part of a larger shopping center structure, but added that the branch’s roof was likely to need repair. The $5 million Lee County Postal Employees Credit Union, based in Fort Myers, may have had among the worst damage. Charley blew away much of the credit union’s roof, forcing the credit union’s employees to work under tarps and without much of its computer access even on generators. But even this credit union, as of press time, was making a go of it, the League reported. The $100 million Community First Credit Union, headquartered in Mulberry, Florida, reported to the League that its Winter Haven branch was without power as of the afternoon of August 17. The building took a direct lighting hit which also destroyed its sign during the storm. But the credit union’s main office, and attached modular building, were still intact, the credit union reported, with the modular building having been held down by 37 tie-down straps. Lack of power is the biggest handicaps most struggling credit union branches still faced and many reported to the League that the use of generators was not sufficient to keep their branches open for their usual hours. Assessing The Full Cost Getting the power up and running remained among the most important priorities because the credit unions have been busy trying to assess the storm’s damage to their own employees, their members and their communities. Laida Garcia, executive vice president of the Florida Central CU said that the 6,000 members the credit union had in the areas hit hardest by the storm have roughly $3.5 million in mortgages with the credit union. She added that the credit union had already planned to forgive two or three months of mortgage loan payments to help its members get back on their feet and to help members work with their insurance companies to finance repairs and rebuilding. Dorety reported that something like 25,000 Suncoast members lived in hard hit areas, but he had no figures yet about how much of the property might have been lost. Meanwhile, the Suncoast Schools Board of Directors met on the evening of August 16 and set aside $250,000 for the credit union to contribute to relief efforts of both members and non-members in the wake of the Hurricane. The credit union will use the local Red Cross affiliates to help guide how the money is used, Dorety reported, and the money will not include the $1,000 individual interest free loans that the credit union has begun to make available to stricken members. Also on August 16 NCUA activated its disaster relief policy for credit unions which might have been damaged or whose members might have suffered losses due to Hurricane Charley and Tropical Storm Bonnie. Bonnie came ashore along the Florida Panhandle before Charley made its appearance. Under the disaster relief policy NCUA will encourage credit unions to make loans with special terms and reduced documentation, the agency said. Credit unions in the effected areas which are facing routine examinations will have those examinations rescheduled and will be able to guarantee lines of credit through the National Credit Union Share Insurance Fund. They will also be able to access loans though NCUA’s Central Liquidity Facility to meet their liquidity needs. Meanwhile, the League has established that roughly 500 credit union employees had suffered significant damage in the storm and announced that the FCUL Services Group will donate $10,000 to a special fund at the Florida Credit Union Foundation for employees with property damage. “The purpose of this fund will be to provide assistance to any staff and volunteers of our family of credit unions that have suffered significant and severe damages as a result of the storm,” the League said in an announcement. Credit unions, credit union organizations and staff can donate to the fund by designating donations to the Foundation as for Hurricane Charley Credit Union Relief Fund. [email protected]