Kingswood residents and a business owner claim a new road upgrade is to blame for what they said was unprecedented flooding after a thunderstorm late last year.
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Carmen's Restaurant owner Carmen O'Sullivan said the December 29 storm sent a "river" of water through her business, leaving her with an estimated $150,000 bill.
"It's not our water," she said.
"This property can take water. And when we built this place, we put $30,000 of council-approved drainage to take our water. But we didn't design it to take all of Kingswood's."
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She blamed a recently-completed upgrade of the New England Highway for creating the problem.
Kingwood resident Anita Dernee said the upgrade had changed the "camber" of the road, dramatically increasing water runoff. But Transport for NSW hadn't increased its drainage to cope, she said.
Her property was inundated by "severe flooding", with 30cm of water flowing through her granny flat and entertainment area. Ms Dernee, a local hospital nurse, also lost $150,000 worth of jumping and dressage arenas to the flood.
"I borrowed that money to do the arenas, so I can't re-borrow that sort of money," Ms Dernee said.
"My youngest daughter is a showjumper and this is her livelihood. She's a professional showjumper, so we need the arenas for her to be able to train on to compete. Last year of course, because of COVID, we only had I think six competitions for the whole year.
"Hopefully this year coming up we'll need the arenas to be able to compete on. At the moment we can't ride on them."
Like the entire Tamworth region, the area has not had constant rainfall in years.
But Ms Dernee has never seen the area flood so heavily, even after much more intense rainfall.
Another neighbour estimated they got 75mm of rain on the day of the storm. In February it got an even heavier bucketing, with about 120mm over the course of an hour, but the locals said there was no reports of flooding.
A Transport for NSW spokesperson said the road's culvert system performed "as designed" in the December storm.
Staff had inspected the control measures and found they were still functioning following the rainfall event, the spokesperson said.
"Transport for NSW will return to the area early in the New Year to discuss run-off during high rainfall events with council and local residents and to investigate possible further work over time to address potential local flooding during high rainfall," the spokesperson said.
Carmen's Restaurant is not on a marked flood plain, Mrs O'Sullivan said. But without change she's concerned the flooding could happen again.
"We did have a big deluge [on the Tuesday] but it shouldn't have done [that]. The water was trapped in this block. It had nowhere to escape," she said.
"We need something done because it will [happen again], that's the scary part."
About 20 residents of Kingswood rushed to the aid of the restaurant during the flooding. It reopened four days later.