(WSVN) - Last week’s torrential rain put the spotlight on Miami Beach’s overwhelmed flood control system. The water receded but businesses and homeowners say their problems are just beginning. 7’s Brian Entin investigates.

When Miami Beach’s $400 million stormwater system fails, Tony Gallo’s restaurant “Sardinia” floods.

Tony Gallo: “Once it fills up there, it comes all the way in.”

It was bad last week, but it was even worse last October.

Tony Gallo: “Customers, we have to give them bags to put on their feet so their shoes wouldn’t get wet.”

Tony says he was left with more than $200,000 in damage.

And adding insult to injury … he got devastating news from his insurance company.

Tony Gallo: “We got a letter, denial.”

A denial letter claiming Tony’s loss wasn’t covered because his restaurant has become a basement.

And that is because of Miami Beach’s new stormwater project.

Tony Gallo: “As you can see, they raised it about three feet.”

The city spent millions to raise the roads in Sunset Harbour to alleviate street flooding.

An insurance adjustor decided Tony’s restaurant is now below the sidewalk — and underground.

Brian Entin: “So they consider your entire restaurant a basement?”

Tony Gallo: “Correct.”

Brian Entin: “And you had no idea?”

Tony Gallo: “I had no idea.”

What happened to Tony and his restaurant has homeowners in Miami Beach worried — especially in this neighborhood where the city plans to rip up roads, and raise streets.

Glenna Norton, homeowner: “About here on my leg. Right about there.”

That’s how high Glenna Norton says the city plans to raise North Bay Road.

Miami Beach crews are raising roads from South Beach to North Beach.

The city gave us this map. All of the areas in yellow are where they intend to raise the streets through the year 2025.

Thousands of homes and businesses will be affected.

Glenna Norton: “So it is going to be even higher here.”

Glenna is worried when the road is raised … her home could also technically become a basement.

Glenna Norton: “The city says they are going to remove the water from the street, but they are not guaranteeing they are going to remove the water from my property.”

Glenna and her neighbors call the flood control project “experimental,” but city leaders insist their plan will work.

Susy Torriente, Miami Beach asst. city manager: “There could be a glitch, with insurance, but again, we are not creating basements.”

The city says it’s working with FEMA, the federal agency that oversees flood insurance policies.

Susy Torriente: “If there are hiccups, the City of Miami Beach is here to help.”

Tony has been fighting for 10 months since he filed his insurance claim.

Tony Gallo: “Everytime it rains, we have a little bit of panic.”

Panic — not knowing when the next storm will strike, and if he’ll be covered.

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