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Pearl River CC still wrangling with Katrina insurance claims

Mold continues spreading in the auditorium of Moody Hall at Pearl River Community College, a visible sign of the lengthy dispute the college is having with its insurance company over Hurricane Katrina claims.

“Well, the mold has gotten worse,” PRCC President William Lewis said.

The auditorium was destroyed Aug. 29, 2005, when Hurricane Katrina’s winds ripped off the back of Moody Hall’s roof and deposited it yards away, allowing rain and debris to deluge the 400-seat theater, Lewis said. Its wooden floor, warped with moisture, undulates dangerously, lifting rows of seats along with it. The place so reeks with the mold spores, dust and other detritus, and maneuvering across the buckling surface is so dangerous, that the auditorium has been locked for the last 14 months.

Until PRCC settles its claim with Zurich Insurance Co., there is nothing Lewis can do about it.

Illinois-based Zurich spokesman Steve McKay said the company cannot comment on individual policies or claims.

With the start of an appraisal process this week, during which both parties select representatives and a third party “umpires,” the drawn-out settlement process could be nearing a close.

PRCC expects its total campus damages to reach $40 million to $50 million; the hurricane at least superficially affected most of PRCC’s buildings, said Roger Knight, dean of business services. The storm destroyed the Poplarville campus’ coliseum, and mold remediation continues in many buildings.

Knight and Lewis said the delay seems to stem at least in part from Zurich’s repeated loss of paperwork and damage reports.

“This has been happening on a regular basis — it’s been over a year now,” Knight said. “They’ll just say, ‘We’re sorry, but we can’t put our hands on it.’”

PRCC’s public adjuster, Waveland-based Scott Favre Construction Management, is very detailed, Lewis said, requiring signatures to confirm the receipt of paperwork sent via mail and burning electronic copies onto CDs. Some reports were even hand-delivered — “whatever would work for both parties,” Lewis said.

Lewis said Zurich quickly gave the college $8 million to do “triage” repairs on buildings so school could start again — mostly roof repairs that were necessary to avoid future rain damage. PRCC was also received hundreds of thousands of dollars from sources like the Bush-Clinton Katrina Fund, U.S. Department of Education grants and more. Since much of that money is earmarked for specific purposes, the college has not yet had the flexibility to put funds toward larger projects like Moody Hall and the Coliseum, Lewis said.

For claims as large as PRCC’s, such waits are common, Favre said.

“An insurance company is always going to have the right to investigate their loss,” he said. “With a large loss, sometimes it takes a little longer than it should before it gets resolved.”

About a month ago, Lewis said, Zurich representatives offered PRCC $15 million. Lewis said the proposal “was somewhat offensive.”