City’s Costs Spiraling in Wake of Bus Crash : Finances: Tab from fatal bus accident nears $500,000. Families of two victims file claims totaling $40 million.

Families of two victims in last week’s fatal collision between a malfunctioning trash truck and a school bus have slapped the city with legal claims for $40 million, while other expenses connected with the accident are already mounting toward $500,000.

City officials on Friday could not provide a total tally of the costs connected with the incident, but garbage truck drivers alone will have racked up $363,000 in overtime by Sunday, according to Bureau of Sanitation director Del Biagi. If part of the 390-truck automated fleet continues to be grounded for inspection and repair as expected, the overtime costs will also continue--at $478,000 every two weeks, Biagi estimated.

At that rate, he said, the refuse collection division could be out of cash by January. “Obviously, at some point in the consideration of all this, we will need to go to the City Council to seek additional funds,” Biagi told the Board of Public Works on Friday morning.

Mechanics from the Department of General Services, who have been helping workers from Ontario-based manufacturer Amrep Corp. inspect and repair hundreds of the trucks, are under similar overtime pressure. But officials there did not return repeated calls Friday.

Several other expenses are mounting without city officials keeping track. Amrep has provided ongoing maintenance and parts for retrofitting the automated trucks, but no one has discussed a price tag. Seal Laboratories, the independent metallurgy firm helping the city investigate the crash, is working without a contract.

“This is all being done, right now, gratis,” Bureau of Sanitation spokeswoman Gyl Elliott said of Amrep’s services. “We don’t know what will happen later, but so far they’re not charging and we’re not paying.”

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Based on hourly rates and estimates of work done so far by Seal Laboratories President Roland Marti, the city will probably face a bill from the firm for more than $30,000.

The city also promised to cover funeral expenses for 8-year-olds Francisco Mata and Brian Serrano and medical bills for Mario Garay, the boy who suffered a fractured skull in the crash but survived. By far the largest financial impact, however, looms in the legal actions launched Friday. Attorney Steven A. Lerman filed the claims--the official precursor to a lawsuit against the city--on behalf of the families of Brian and Mario, who are cousins.

In the claims, Lerman alleges “gross negligence” by the city for allowing truck No. 70 out on the street even though a driver had flagged it for repair the night before.

Asking for $25 million on behalf of Maria C. Serrano, Lerman says she has lost “the love, companionship, solace and affection” of her son. He filed a $15-million claim on behalf of Mario and Rosario Garay.

Francisco’s family said they have not yet pursued legal action.

Board of Public Works Commission Vice President Frank Cardenas said that neither the legal filings nor the mounting expenses come as a surprise, but that it is particularly difficult to deal with them in the face of tight budgets.

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Meanwhile, about 4,500 tons of garbage continued to sit on curbs in the east San Fernando Valley as more than 100 trucks remained out of service because of the ongoing inspections and repairs. Sanitation officials said they expected to catch up over the weekend, but that they would likely fall behind again in pickups on Monday.

Cardenas and other Public Works commissioners met at 5 a.m. Friday with truck drivers throughout the city, encouraging them to come forward with any other information regarding problems with the hydraulic compacting system that caused the accident. Earlier this week, officials confirmed that there have been two previous incidents in which a hydraulic piston shot through the side of trash trucks, a similar malfunction to the one that caused the crash.

In other developments Friday, California Highway Patrol Capt. Ray Blackwell said he believes the truck drove several blocks with a rod protruding before ramming the school bus. That conclusion--based on interviews with 54 witnesses--runs counter to sanitation officials’ original contention that the piston shot out as the truck reached the intersection.

CHP expects to conclude its investigation by mid-January.