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Lawsuits allege sinkholes weren't properly disclosed to homebuyers

Investigations result in new designations
Marcum family
Posted at 6:07 AM, Aug 19, 2021

PORT RICHEY, Fla. — Catastrophic sinkholes can take Florida residents' homes, property or even their lives in a matter of seconds.

State law requires unrepaired sinkhole homes to be listed in county records, warning potential buyers.

But the ABC Action News I-Team has uncovered that unrepaired sinkhole homes have been reclassified on county appraiser websites in three Tampa Bay area counties, even though no repairs have been made. And that sometimes leaves new owners in the dark.

“Everything was remodeled. We liked that it has a new roof, a new AC,” said Miranda Marcum.

Miranda, her wife Debra and their three children moved into a three-bedroom, two-bath house in Port Richey in January.

“This is our first home we own and we wanted a place to call home forever and for our kids to grow up,” Miranda Marcum said.

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Miranda and Debra Marcum thought this home in Port Richey was their dream home, until they learned there had been sinkhole activity found at the home nine years ago.

"None Reported" listed on Pasco County Appraiser site regarding sinkhole activity

She said her realtor didn’t tell her there had been previously identified sinkhole activity at her home.

“Nothing. She never mentioned anything about it,” Miranda said.

The Marcums thought they were safe from sinkholes since the county property appraiser classified their home’s sinkhole status as "none reported."

The previous owner checked boxes saying “No” and “Don’t know” on the seller’s disclosure form when asked about prior sinkhole claims.

But the I-Team found a report from 2012 indicating sinkhole activity and recommending thousands of dollars in repairs, including underpinning and compaction grouting.

Report from 2012 determined sinkhole activity was responsible for issues at the home purchased earlier this year by the Marcums

That’s a process that fills underground holes with hundreds of cubic yards of cement.

Miranda said she would not have bought the home if she had seen the prior report.

“We see sinkholes on TV and it looks terrifying and not something we’d be willing to risk,” Miranda said.

Miranda remembers the 2013 Seffner sinkhole, in which Jeff Bush was swallowed by a gaping hole that opened up under his bed as he slept. His body was never recovered.

Four years later, a sinkhole in Lake Padgett destroyed seven homes.

In 2012, an engineer recommended compaction grouting to repair the sinkhole under the home where the collapse started, but the repairs were never made.

How sinkhole tags were removed from county records

So how did the sinkhole designation for the Marcum's home get changed on the Pasco County Appraiser’s website?

Professional geologist David Harro, who owns the G3 Group, began offering a new service to homeowners, realtors and investors in 2017.

David Harro
G3 Group owner, professional geologist David Harro has conducted 187 new sinkhole investigations at homes with unrepaired sinkholes. Reports show he found no sinkhole activity at most of them.

He gave seminars, posted online videos and advertised on social media.

One post stated “The G3 group has an excellent conversion rate” when it came to reinspecting sinkhole homes and “having those tags removed from county records altogether.”

“This firm has said we can get that removed. Nobody’s going to see that designation anymore. In many instances, that will double the value of the amount you can sell this house for,” Attorney Josh Burnett said.

Burnett has filed 10 lawsuits in three counties against Harro, his company, multiple realtors and investors.

He alleges his clients were misled about the condition of their homes.

“That change that is being made on county records is only a change on paper. There’s no change whatsoever in the condition of the property. There’s been no repair performed,” Burnett said.

Home sales price increased from $75,000 to $200,000 in months

The Marcum's home was sold by a bank to an investor for $75,000 last September.

The bank’s listing said, “County record refers to prior sinkhole activity - buyer shall do their due diligence pertaining to such.”

When the investor purchased the home, it had been on the market for nearly six months.

In October, Harro conducted a new investigation, concluded there was no sinkhole activity then filed a new report with the county, replacing the previous sinkhole designation.

The Marcums paid $200,000. The asking price was $194,000.

Records show the home was under contract four days after it was listed.

redacted sink hole report
New Investigation by Florida Licensed Geologist David Harro shows no sinkhole activity at the Marcum's home, where sinkhole activity had been identified by professionals in 2012

“The traditional mortgage companies, the traditional banks, they’re not gonna lend money on a confirmed unrepaired sinkhole property. They’re not gonna do it,” Burnett said.

He said homeowners insurance companies will also refuse to insure homes that have unrepaired sinkholes.

"It’s a ticking time bomb"

Records show that since 2017, the G3 Group has inspected 187 previously confirmed, unrepaired sinkhole homes.

In all but one case, Harro ruled out sinkhole activity in his reports.

“It upset me when I found out about it,” said Geotechnical engineer Darrell Hanecki.

Hanecki has conducted thousands of sinkhole investigations over three decades.

“These are three reports from one piece of property that all concluded, sinkhole. And yet, G3 has come to this piece of property and said no sinkhole,” Hanecki said, showing multiple reports for a home Harro recently inspected.

“Sinkholes aren’t self-healing. Voids in limestone continue to be voids in limestone,” Hanecki said. “It’s a ticking time bomb. It’s just a matter of is the bomb gonna go off in a thousand years or is it gonna go off tomorrow.”

Hanecki says G3 Group’s new investigations are contradicting reports from some of the world’s top sinkhole experts, including university professors and members of Florida’s boards of geology and engineering.

“We’ve got literally hundreds of experts who have rendered these prior reports and all of their opinions are being cast aside over and over and over again,” he said. “I find it hard to believe that one guy has come up with the magic tool and everybody else in this industry has been clueless all along.”

We contacted David Harro three times and called and emailed his attorney, but they have not responded. We went to his office earlier this week, but when we spotted Harro in the parking lot, he went inside and closed the door.

His attorney has filed for extensions to answer the allegations in the lawsuits.

We also contacted the investor and both realtors involved in the Marcums home sale, but none of them responded either.

Pasco County’s spokesperson said in an email, “A sinkhole status change is automatically completed by our office when we discover sinkhole documentation through a routine review or permit search of Pasco County’s official records.”

“If you’re the buyer, you want to know the facts. You don’t want to be sold a bill of goods and pretend that a problem that other people have found no longer exists,” Hanecki said.

“They had that information when they were buying it. It’s only fair that they provide it to these other purchasers as well. If they get a new report, okay… provide that to them too,” Burnett said.

When we first met the Marcums, they had no idea there had been previous sinkhole activity at their home. They recently hired Burnett to represent them, but have not yet filed a lawsuit.

“Now we’re coming in with our family and it’s gonna be like walking on eggshells. Like what if something happens?“ Miranda said.

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