Documents Suggest Managers Rushed to Get Ash Street Project Online Despite Concerns
Newly obtained documents, combined with existing legal claims, suggest that top managers dismissed or downplayed safety concerns from the people on site, cut corners and pressed ahead with plans to occupy the building amid public pressure.
As the 101 Ash St. property undergoes official scrutiny and review, newly obtained documents paint a picture of rushed and mismanaged renovations inside a downtown high-rise that the city had hoped would house hundreds of its workers.
Two contractors filed claims for damages with the city on Friday alleging that the problems inside the old Sempra headquarters while it was undergoing renovations went beyond asbestos.
At least five legal claims have been filed by various engineers, including a Public Works Department employee, since officials evacuated the building in January. Those documents suggest that top managers dismissed or downplayed safety concerns from the people on site, cut corners and pressed ahead with plans to occupy the building amid public pressure.
Initially, the city’s director of real estate assets, Cybele Thompson, told the City Council that the building at 101 Ash St. would only need a $10,000 exterior power wash and little else, but the project substantially grew in scope after officials struck a lease-to-own deal with Cisterra Development and real estate investor Sandy Shapery in late 2016. More than a year later, officials went back to the City Council to ask for $30 million so they could renovate all 19 floors and maximize the space to house municipal workers.
City Councilwoman Barbara Bry was the first to raise questions in spring 2018 about why the project was taking longer than anticipated and why the renovations had grown. Embarrassing headlines in the Union-Tribune and elsewhere would follow about how the city was spending nearly $18,000 a day to rent a vacant building.
In one of two new legal claims filed Friday, Eric Jackson, a senior construction manager and corporate safety officer with Harris & Associates, a contractor, said he worked at 101 Ash St. every day for about four months and alerted top city managers in an Aug. 1 meeting to a host of serious issues.
Jackson claimed critical access systems that are triggered in cases of emergency and prevent the spread of fire were inoperable and needed to be replaced. One such system, which managed the flow of air, he said, wasn’t working properly and had been manually fixed in an open position.
That’s significant because it meant the building’s asbestos and other contaminants, which were being disturbed during the renovations, could be disseminated in the air more easily.
Jackson said city officials responded in the Aug. 1 meeting that they would not go back to the City Council to seek more money under any circumstances and would address the building’s safety systems later.
Between August 2019 and January 2020, county air pollution regulators repeatedly warned the city and its general contractor, West Coast General, about asbestos, which is harmful when airborne. The building was vacated again in January after the county issued a notice of public nuisance.
In his legal claim, Jackson said officials fired him weeks after he raised concerns about the building’s problems.
“These fire safety issues were so blatant and so dangerous every contractor was concerned for public safety so they were all coming to city management to put their concerns on the record,” Jackson wrote.
In a Nov. 29, 2019, memo to the city’s Public Works Department, West Coast General warned that a number of issues — including the fire alarm system — still needed attention and would likely not be fixed by the city’s projected move-in date of Dec. 9.
“Due to the above critical items, and possible other issues that West Coast General Corp. is not privy, it is difficult to see how the city will be able to safely occupy the completed portions of the work on 12/9/19,” company project manager Chad Crick wrote in the letter obtained by VOSD. “Many of these issues have been outstanding for quite some time and were included on our May 2019 progress schedule updates list and again on the August 2019 progress schedule notes.”
The company could not be reached for comment Friday.
Jackson’s descriptions of how the project went awry mirror the descriptions of others.
In January, Luis Guerrero, an engineer for the real estate services firm CBRE, which was working on site, alleged that the city had disregarded lawful practices for asbestos containment and hid the existence of those hazardous materials from workers to keep costs down. He said he was later barred from the building. Then in early February, Marlon Perez, an assistant engineer in the Public Works Department, said in a letter that his supervisors knowingly put an unqualified person in charge of the project. Two days later, other contractors came forward to allege the city was well aware of the dangerous conditions but sent workers in anyhow.
Yet another legal claim filed Friday by Scott Niel Lee, CEO of Air Metrx, a heating and air conditioning contractor, backs up Jackson’s portrayal of the Aug. 1 meeting with city managers.
In October 2019, Lee said, unnamed city managers tried to dissuade and block West Coast General from proceeding with independent inspections. West Coast General had become concerned about the truthfulness of the city’s environmental testing. Even after the company confirmed the existence of asbestos in a utility shaft and the city acknowledged it, Lee said, officials kept a scaffolding in place “to hide the full extent of asbestos contamination” from county air pollution regulators.
Larry Shea, an attorney who represents Jackson, Guerrero, Perez and others, said the stories of the contractors and city employee point toward the same thing inside the Ash Street project: “a culture and a propensity to lie and a willingness to put people in danger.”
Christina Chadwick, senior press secretary for Mayor Kevin Faulconer, said the city is unable to respond to legal claims, which are precursors to litigation. But she provided additional correspondence that resulted from West Coast General’s Nov. 29 memo warning of the condition of the fire alarm system and other parts of the building.
On Dec. 11, the company’s president, David Davey, expressed appreciation to the Public Works Department director for the “substantial and good-faith precautions to ensure that 101 Ash Street is safe for city employees and the public to occupy. We look forward to the completion of our tenant improvement scope for the City and continued partnership towards occupancy of the building,” Davey wrote.
The move-in date for city employees was delayed until Dec. 16.
The evacuation came in January and in the weeks that followed, city leaders made personnel changes that affected the oversight of the Ash Street project.
Ronald Villa, a top city manager who worked on the acquisition and renovation, was removed from his post as assistant chief operating officer in February. He’s scheduled to retire this summer. Earlier this month, Kris Michell, the city’s chief operating officer, also reshuffled the management structure. In the process, she announced to the City Council the creation of a new chief compliance officer and a new committee that identifies and manages risk in city operations.
Internal reviews of what happened inside the property are underway. At the request of members of the City Council, interim City Auditor Kyle Esler also agreed to review whether the city knew, or should have known, the extent of the asbestos inside the building and any deficiencies with it.
But he said he was reluctant to consider whether the owners and sellers of the property had properly disclosed the true condition of the building up front. That issue may be better suited for investigation through the legal process, not an audit, he said.