The world has been pounded over the past few decades by global
catastrophes. Hurricanes, earthquakes and tsunamis have claimed hundreds
of thousands of lives and displaced millions from their homes and
Want to hear some frightening facts about where we live? The
Knesset Steering Committee on Earthquakes recently pointed out that the State of
Israel is situated alongside two tectonic plates along the Rift Valley. Looking
back historically the land of Israel has suffered some massive earthquakes.
Josephus Flavius describes how, on the seventh year of Herod’s reign (31 BCE),
“There was an earthquake in the land of the Jews such as had never been seen
before, and 60,000 people were killed under the collapse of buildings.”
few hundred years later, the city of Beit She’an, which was one of the largest
cities in the Hellenistic world, was totally destroyed. Modern archeological
digs in the city have uncovered the unprecedented extent of the
In 1837, Safed was almost completely ruined, and in Tiberias the
city walls collapsed and one-fifth of its inhabitants were killed. In 1927,
there were hundreds of dead and injured in an earthquake that rocked Nablus,
Tiberius, Ramle and Lod.
The Knesset committee, headed by MK Meir
Sheetrit (Kadima), was told by scientists that in the near future we can expect
an earthquake that will be 7.5 on the Richter scale, with the epicenter probably
in the Beit She’an area and a horrifying figure of 16,000 dead.
light of the above, it is astonishing that the sole government initiative in
recent years to protect and strengthen buildings throughout the country recently
lost its legal standing.
That initiative – known as “TAMA 38,” which
stands for Tochnit Mit’ar Artzit (national zoning plan for strengthening of
existing buildings to withstand earthquakes) – has already been described as a
“band-aid” solution to a problem that was described as “potentially existential”
by the Knesset committee.
The problem begins with the Israeli housing
stock. For example, the hugely destructive Turkish earthquake demonstrated the
importance of good construction; most construction was not properly regulated,
and buildings collapsed in a matter of seconds.
Notably, of the 812,000
buildings in Israel, 370,360 were built before 1975; 361,595 were built after
1975, and about 80,000 buildings were built at an unknown date. Only in the
1980s did the government regulate building construction with a view to a
The upshot is that a large part of the Israeli
buildings stock requires reinforcing and presently is not ready to withstand a
For the taxpayer to finance the reinforcing of
hundreds of thousands of buildings would be an unpopular and expensive endeavor.
So the government devised a plan to incentivize house owners to undertake these
repairs in cooperation with building companies.
How was this supposed to
work? In a nutshell, the government would grant permission for buildings to
receive added zoning rights that would allow extra space to be built. The
betterment tax usually levied on such extra building rights will be reduced by
90 percent, and other tax relief would be provided.
Contractors would be
encouraged to approach building owners, and in return for permission to build
desirable penthouses on the roofs, utilizing the newly granted building rights,
they would reinforce the buildings and often add to their value by creating
lobbies, gardens, much-needed elevators and “safe rooms” and generally improve
the facade of the building.
Potentially, this is a win-win
The community receives safer buildings, older people get
easier access to their apartments with the new elevators, everyone theoretically
makes money, and more much-needed apartments are made available to the
But something got lost in translation between the legislative
intent and the execution of this otherwise good idea: Problems in obtaining
enough neighbors to agree to the process; the reluctance of banks to finance
these projects; the “cowboy” element of unprofessional and sometimes scrupulous
entrepreneurs entering into the field; the lack of regulation governing the
final product given to the sometimes naive owners; and the resistance of local
planning committees all hindered the process.
All this led to a minimal
amount of projects successfully executed.
So, should you rush and convene
your neighbors and prepare your building for the TAMA 38 process? The answer is
a definite yes.
First, although TAMA 38 was a temporary measure enacted
for a three-year period, which recently ended, this is definitely not the last
you will hear of it. MKs and many professionals in the field are pushing TAMA 38
to become a permanent law. This is being treated as a high priority and it will
no doubt come back into force shortly.
Second, used correctly, the
opportunity provided by TAMA 38 is an unbeatable tax-free method of adding to
your assets and, collaterally, contributing to the public good, not to mention
your own safety.
Our next article will describe a safe and hopefully
profitable road map to TAMA 38.
Haim V. Katz is
a senior partner in a law firm with offices in Jerusalem and Tel Aviv
specializing in real-estate, commercial, litigation, family and probate law. Sam
Katz is a jurist in Jerusalem. They have collaborated on several legal works on
probate and land law including the e-book
Buying Your Home in Israel and Probate
& Inheritance – The Complete Guide.