Some Manatee County homeowners excluded from KB Home statewide settlement on statewide construction defects

KB Home reached a settlement with the Florida Attorney General's Office involving construction defects, failure to disclose problems to buyers and denial of home-warranty claims for 1,688 houses across the state.

At the core of the state's three-year investigation were construction defects that led to water intrusion, which leads to mold, wood rot and even structural failure, according to the state. In some cases, the builder made the appropriate fixes but in others it ignored problems and failed to inform buyers -- all in violation of the Florida Deceptive and Unfair Trade Practices Act.

As a result, one of Central Florida's leading builders must repair houses that are up to 10 years old and qualify under the terms of the settlement. In addition, the Los Angeles-based builder must provide the Attorney General's office with $6.5 million, which will help repay homeowners who had to pay for their own repairs. In addition, the company must invest $17 million improving its building methods, training its work crews and using improved building materials.

But Manatee County victims of the company's poor construction methods question whether the settlement will be of any real help. Roxanne Miller, who lives in KB's Willowbrook subdivision in East Manatee, has been fighting for years to have water leaks and other issues in her home fixed. She said the agreement may put her and her neighbors in a position where they have no future recourse if anything else goes wrong with their homes.

The settlement, she said, requires homeowners to sign off on future repairs.

"You have to go through hoops for it, you have to sign waivers," Miller said. " There's a lot of questions coming up."

In 2009, Miller's home and 271 others in the Willowbrook community were discovered to have water intrusion, mold and defective balconies, among other construction problems.

The builders' acts and practices constituted "unconscionable acts or unfair or deceptive acts and trade

practices," according to the complaint filed by the attorney general in Tallahassee Circuit Court on Feb. 10. The settlement was announced the next day.

"KB Home Florida has cooperated with the Attorney General's office to address issues with residential stucco performance, which we consider to be an industry-wide challenge in Florida," reads a statement from KB Home. "KB Home is committed to providing quality homes and we stand behind our product."

It went on to on to reference the company's support of state efforts to improve standards for stucco and it's new "industry-leading" warranty on the material used to cover building exterior walls.

From even before the state launched its investigation, KB Home has spent what now totals more than $71 million to reconstruct and repair damaged residences.

Miller said she and other KB buyers she communicates with are looking into what it might take to overturn the settlement and bring KB back to the negotiating table. One of those buyers, Vero Beach resident Abby Dozier, said most of her neighbors in KB's Carriage Lake subdivision don't even qualify under the agreement. About half of them own homes built before the period covered by the settlement.

"This is going to exclude 49 percent of the homes of my neighborhood," Dozier said. "I'd say that's a big problem."

Specific violations cited in the complaint included:

Failing to disclose to certain purchasers that the homes being constructed violated applicable building codes or original building plans.

Denying certain consumers' warranty repair requests because they purchased distress properties or failed to maintain their homes.

Last month, KB Home reported lower-than-expected revenue for the fourth quarter, with labor shortages and inclement weather slowing completions in some areas of the country.

Matt M. Johnson, Herald business reporter, contributed to this report.

This story was originally published February 15, 2016 at 10:03 PM with the headline "Some Manatee County homeowners excluded from KB Home statewide settlement on statewide construction defects ."