A Santa Clara business owner who lost business because of two city construction projects has been made whole, but the situation illuminates a larger question about the city’s responsibility regarding contractors.
After two city projects shut off water, shut off his power and closed the street last year, the owner of OG Performance and Tuning, 940 Shulman Ave., said he lost $18,600 in business.
While he is satisfied the city and its contractor have settled the claims, Ercan Genis, owner of OG Performance and Tuning, said he is still unhappy with how the city handled the situation.
In August, the city cut Genis a $4,450 check for his initial claim. That claim stems from utility-pole work Silicon Valley Power (SVP) did in July last year. Then, last month, the city contractor that did the water main upgrades settled his other claim. Genis said he was unable to discuss the details of that settlement.
“With that money, I am able to pay my credit card, so I can buy more parts or more equipment for my shop that I have needed for a while,” Genis said.
The water shut-off was particularly devastating. Genis relies on water to operate a dynamometer, a device to determine the torque and power of engines.
In an email exchange, Janine De la Vega, a spokesperson for the City of Santa Clara, wrote that the power-shut-off situation was a “pending legal matter” at the time of The Weekly’s initial inquiry. Further, she wrote that the city “never denied” Genis’s claim.
“Once the claimant provided evidence to support the amount of his claim, the claim was promptly settled,” De La Vega wrote. “The City is very pleased that we were able to reach a resolution acceptable to all parties.”
A third-party assessor handles claims against the city.
An adjuster from Carl Warren & Company, Donald Chang, fielded Genis’s claim. However, despite supposedly being a “third-party,” in an email to Genis, Chang wrote that the city “has plenty of legal battles of their (sic) own that I am also attending to.”
While he told Genis that he “wasn’t about to encourage litigation” against the city, Chang added that Genis “might have a case against the contractor.”
“Did you know that you can receive an award of up to $12,500 in Small Claims Court now and the filing fees top out at $250 if you have to hire a process server,” Chang wrote to Genis.
For the water main work, the city issued Preston Pipelines, a private contractor, an encroachment permit. The city’s water department shuts off water for system upgrades, which, De la Vega wrote, is what happened in Genis’s situation.
System-upgrade work necessitates a water shut-off, De la Vega wrote, because a pressurized water main could spew water everywhere should the contractor breach the line.
The encroachment permit requires contractors to notify businesses their water will be cut, something — despite Genis’s claim to the contrary — De la Vega wrote, Preston Pipelines fulfilled.
“What is the point of issuing an encroachment permit if they are not going to enforce it?” Genis said.
Santa Clara has previously acknowledged that the notification for SVP needs improvement.
However, the city did not comment on the disparity between claims from Genis and his neighbors that they were not notified of the water shut-off and the water department’s determination that they were.
“The Water Utility reviews all requests for shutdown and only approves shutdowns that are absolutely necessary to complete upgrades to the water distribution system,” De la Vega wrote.
Upon review, the water department “proceeded to shut down water service to this area” on behalf of Preston Pipelines.
De la Vega wrote that the Preston Pipelines project was “entirely different” than the SVP work, adding that it “did not include City employees or City departments.”
Despite De la Vega and Chang both insisting that city employees were not onsite during the Preston Pipelines project, Genis tells a different story. A water utility employee gave Genis his card, he said, offering to bring a water tank despite such a solution coming too late.
Although the matter has been settled to Genis’s satisfaction, questions remain about the relationship between the city and contractors doing work on its behalf and where responsibility lies.