Latest News…November 25, 2019

1099 Issue Update

CFSIC has received, through the help of Congressman Joe Courtney, a Private Letter Ruling that now clarifies the 1099 issue.

This Private Letter Ruling indicates that CFSIC is not required to provide homeowner claimants with a 1099. The IRS has determined that CFSIC does not collect, as part of its application process, the kind of information that would enable it to determine the tax basis of any individual homeowner, whether receiving funds directly from CFSIC as a Type 2 claimant or indirectly as a Type 1 claimant.

PLEASE NOTE: What CFSIC has received is a Private Letter Ruling dealing only with what CFSIC is required to do…homeowners are well-advised to seek guidance on any personal tax implication they may have from the direct or indirect receipt of CFSIC funds.

Where We Are

CFSIC has returned 75 families to their homes.

We remain in suspension for the taking of new applications. What will enable us to open our doors again for new application activity will be either or both of the following:

– the value of our held claim reserves is reduced through executed construction contracts by a minimum of $5 million;

– our current sunset date of June 30, 2022 is extended, enabling us to take revenue credit for additional homeowner policy surcharge revenue past June 30, 2022.

CFSIC’s Superintendent continues to countersign Participation Agreements at a rate of three per week in order to ration existing cash through this fiscal year.

Expanding Our Outreach to Condos…

Effective tomorrow, November 26, CFSIC has modified its Underwriting and Claims Management Guidelines to permit condo units that are bank-owned or commercial investor-owned to be included in allowable concrete cost calculations, subject to certain rules that are shown in the Q&A section below.

The Board of Directors of CFSIC has taken a position from inception that it would not permit that portion of a condominium foundation platform lying below a bank or commercial investor-owned unit to be included in the calculation of allowable concrete costs to be paid by CFSIC.

This will now change effective November 26, 2019.

What follows is a Q&A that will help condominium associations understand the extent of this change and how it benefits associations who have already applied with the exclusion in place.

Question: I am a condo association president, and I signed our association’s original application to CFSIC. Do I have to apply all over again?

Answer: No. You will have to use a modified templated email transmittal to apply specifically for the bank-owned and investor-owned units, but you will not have to complete another CFSIC application. In other words, go here to see the template you will use to send your ESIS claim adjuster an email adding the bank/investor-owned units to your original application. You should copy this template into an email, with your new information, to go out under your name as a duly authorized officer of the association.

Question: My association has already gotten two contractor bids, and these bids already exclude bank/investor-owned units. What do I do now?

Answer: Contact the two contractors (or more) from whom you got your original bids…and simply ask them to re-bid using all applicable units in their revised calculations.

Question: Does the allowable concrete costs cap of $70,000 still apply per unit?

Answer: It does.

Question: So using an example of four units sitting on one foundation platform, where one of those units is owned by a bank that foreclosed on that unit and three are owned by individual homeowners…are you saying that CFSIC will now allow a cap on that foundation platform of 4 units X $70,000…or $280,000?

Answer: That’s correct.

Question: When does this all take effect?

Answer: At 9:00 AM on November 26, 2019.

Question: Do I have to wait until then to send you my updated email template and my revised contractor proposals?

Answer: No…you can do it at any time, but we just can’t do anything with the information you send us until 9:00 AM on November 26.

Question: But I heard that CFSIC is temporarily not taking any new applications…so how can this happen?

Answer: If you have already applied to CFSIC, and your application is in process and registered, then we are considering the addition of bank/investor-owned units to be an amendment to an existing application…not a new application.

Question: Is CFSIC changing the rules for PUDs and stand-alone single-family dwellings?

Answer: No. PUDs, multi-family, and single-family homes that are bank/investor-owned will continue to be excluded from consideration by CFSIC. We will also continue to exclude stand-alone condo units that are bank/investor-owned.

Question: Aren’t you concerned about a lot of investors suddenly running out and buying condo units as investments in order to get access to state funds?

Answer: We are…and it is for this reason that CFSIC will not permit the inclusion of any bank/investor-owned condo unit that became owned by a bank or commercial investor on or after 5:00 PM on December 1, 2019.

Question: So are you saying that if a commercial investor buys a condo unit in my association after December 1, the foundation under that condo would be ineligible?

Answer: Yes.

Question: Are there any other conditions we should be aware of?

Answer: Yes…one very important one. CFSIC will not pay for the replacement of a condo foundation platform if the majority of the units on that platform are bank/investor-owned. In other words, if, for example, with a four-unit condo platform, three of those units are bank/investor-owned, CFSIC will not pay to replace that platform at all…including the platform lying underneath the one unit, in this case, owned by a homeowner.

Question: Okay…but what if, for example, a platform contains four units, two of which are individually owned and two of which are bank/investor-owned?

Answer: CFSIC will pay for the entire foundation replacement subject to the existing condo cap and replacement cost parameters, because there is no calculable majority either way.

The CHFA Credit Enhancements Program

You should go here to learn more about the CHFA credit enhancements program as it is now constituted. Please note that it currently does not apply to condominiums. CFSIC did not create and is not administering the loan program, and the ESIS claim team cannot advise you in any way about the terms and conditions of any aspect of the program. The link noted in this section will take you to an outline of the program, as well as to a section marked “Frequently Asked Questions.” We also recommend contacting the Homeowner Advocate using the contact information on the Department of Housing website for more assistance.

CFSIC’s Annual Report

CFSIC’s Annual Report can be viewed here. 

CFSIC’s 2019 Audited Financial

View CFSIC’s audited financial report for the period ended June 30, 2019.


If you have any questions about the operation of the program, ESIS is your best source of information on your claim, and their phone number and email are shown below.

Phone: 844-763-1207


As you work through the information and application process (understanding that we are in suspension for the taking of new applications), here’s how you can get help:

– Call ESIS (the claim adjuster) at: 844-763-1207

– Email ESIS at:

– Email CFSIC at:

To view a video of how to complete an electronic application, go here.

To apply for a Type 1 claim, go here.

To apply for a Type 2 claim, go here.

To learn more about the program, if you are a homeowner, including application help (once we are out of suspension for the taking of new applications), go here.

To learn more about the program, if you are a contractor, go here.