Pacific Gas & Electric’s plan to file for Chapter 11 bankruptcy protections by the end of this month has prompted numerous PG&E contractors and subcontractors to stop work, and in at least one case, temporarily furlough workers while they seek clarity and assurances that PG&E and its creditors will be able to pay the staggering utility giant’s outstanding bills.
A Stockton contractor for PG&E with employees who live in Calaveras and Tuolumne counties has been forced to “unforeseeably furlough some of its workers,” and the furlough began Tuesday, said H. Alan Rothenbuecher, general counsel for ACRT Pacific and its parent company, ACRT of Ohio.
“ACRT Pacific is a smaller company, and PG&E’s inability to assure ACRT Pacific that it will be paid in full on recent or future work causes financial uncertainty for ACRT Pacific and its employees,” Rothenbuecher said.
Asked how many ACRT Pacific employees have been furloughed, Rothenbuecher responded by saying the furlough began Tuesday, and it is only for PG&E’s vegetation management projects. All ACRT Pacific employees who are furloughed are still ACRT employees, they are still receiving all their benefits, and no one has been separated from employment, Rothenbuecher said. All ACRT Pacific employees assigned to PG&E vegetation management projects “should be back to work on Tuesday or Wednesday of next week,” Rothenbuecher said.
The slowdown prompted by PG&E’s bankruptcy plan has stalled hazard tree removal work in the Camp Fire zone where more than 85 people died in the fast-moving blaze in November, said Gerardo Castillo with AshBritt Environmental, a Florida-based contractor for PG&E.
AshBritt Environmental has more than 150 employees, previously assigned to the Camp Fire area, who are all now idled due to PG&E’s failure to pay the contractor for work already completed, Castillo said Tuesday in a phone interview, speaking from Sacramento.
“We’re calling it a temporary pause of work,” Castillo said, “to evaluate the potential consequences of a PG&E bankruptcy.”
Castillo said he knows of multiple other PG&E contractors, as many as 10, that have put all work on hold because PG&E has stopped paying some contractors.
“As far as continuing to work on the Camp Fire job, we have to evaluate our financial risks, for doing work without getting paid,” Castillo said. “We have paid all our employees to date with no assurances that PG&E is going to pay us.”
Contractors’ work stoppage on hazardous tree removals in the Paradise area is likely to slow down hazardous debris removal work from sites of more than 18,800 buildings destroyed in the Camp Fire, Castillo said.
Kristin Bagby, a Sonora resident who returned in December from more than one month working for PG&E contractors in the Paradise area, said Tuesday she is still waiting to collect her final week’s pay, about $2,000 for 14-hour to 16-hour days with overtime.
Bagby said she worked initially for PG&E contractor Phillips & Jordan, as a tree inspector in Calaveras and Amador counties and in Paradise, about 175 miles north of Sonora. She said she was assigned to go to Butte County around Nov. 13, more than a week before the Camp Fire megablaze was fully contained.
She said the work atmosphere was hectic and freelance, similar in ways to the military.
Group sleeper trailers with communal showers were available, but she was not getting paid per diem expenses. She said she got other job offers and tried to switch employers, but that didn’t work out. She said she is still waiting to get her last week’s pay.
Pacific Gas & Electric notified the state Public Utilities Commission it had equipment issues near the point of origin for the Camp Fire before the blaze was contained. The Camp Fire is now known as the deadliest and most destructive fire in California history.
“Everybody knew PG&E was in trouble,” Bagby said. “A lot of people said they would declare bankruptcy.”
Financiers for PG&E, which faces $30 billion in potential liabilities due to deadly, destructive California wildfires in 2017 and 2018 alone, has lined up $5.5 billion in debtor-in-possession credit, utility staff said Tuesday in a filing with the federal Securities and Exchange Commission. The utility on Jan. 14 announced its intent to file for bankruptcy.
Pacific Gas and Electric staff confirmed Tuesday that some contractors have decided to pause their work while PG&E goes through its planned bankruptcy filing process. PG&E has not asked any contractors to stop their work for the utility, Lynsey Paulo with PG&E said in a phone interview.
“We value all our contractor partners and we understand that PGE's current situation may create hardships for certain vendors,” Paulo said. “We’re committed to the ongoing safe operation of our gas and electric systems, and would not request any contractor to pause or alter its work if doing so would compromise the safety of our operations in any way.”
Paulo said Tuesday there were about 900 contract workers up in the Camp Fire area doing vegetation management. That's 600 fewer than the total of 1,500 contracted tree workers on the job in the Camp Fire area cited Friday by Paul Moreno, another spokesperson with PG&E.
Asked what happened to the 600 other workers, Paulo responded, “Our tree contractor numbers can fluctuate from day to day. We respect our contractors’ positions and others are continuing to work.”
Some Pacific Gas and Electric contractors have been burned by the same deadly fires that have incinerated PG&E’s reputation, including the 2015 Butte Fire in Calaveras County. Attorneys who filed the first legal action on behalf of Butte Fire victims, alleging negligence by Pacific Gas and Electric, in October 2015, also named as defendants two PG&E contractors, ACRT Inc. and Trees Inc.
Cal Fire investigators said the Butte Fire burned more than 110 square miles of watersheds, and it destroyed 921 structures, including 549 homes, 368 outbuildings and four commercial properties, and it killed two residents who declined to evacuate.
“ACRT Inc., they are a tree inspection group,” Jerry Singleton, of Singleton Law Firm in Solana Beach, San Diego County, said in October 2015. “PG&E hires both ACRT and then Trees Inc. to inspect power lines and cut any trees that are too close to the lines. That's what they are supposed to do, and obviously, in this case, we believe they made a mistake.”
The acronym ACRT stands for Assessments, Consulting, Representation and Training.
Contact Guy McCarthy at email@example.com or 588-4585. Follow him on Twitter at @GuyMcCarthy.