Residents Say Flood Settlements Fall Short

First the residents of Hefley Street in Westminster had to deal with 5 million gallons of water. Now they have to deal with the insurance companies.

They lost their homes, their cars and personal possessions ranging from towels to washing machines. So far, about 70 families affected by flooding when a city water tank ruptured on Sept. 21 have filed claims with the city, and more claims are coming in every day.

City officials say they have bent over backward to accommodate the residents, providing free temporary housing and rental cars to those in need. And many residents praise the city for offering quick help.

But some complain that settlements offered by the city’s claims adjuster don’t fairly compensate them for a disaster they had no hand in creating.

“It’s crazy, absolutely crazy what they’re trying to do to me,” said Hefley Street resident Cindy Frank, who lost a car to the rushing water.

Frank, 25, said the city is demanding she return or pay for her rental car now, even though she has not yet received a settlement check for the destruction of her 1997 Ford Escort.

The city’s adjusters are offering her $10,000 for the car, which she bought for $15,000 only three months before the disaster, and on which she still owes $13,000. Her own insurance company has refused to pay her at all, saying the city should be taking care of it.

The situation leaves Frank with no way to get to work in Anaheim or to the store to buy groceries for her two daughters, ages 7 and 8.

Frank and other flood victims appealed to the City Council for help this week, saying they deserve to be fairly reimbursed for a problem that was not their fault.

“The only thing we’re asking for is our losses, something to help us get to our jobs so we can take care of our family,” said Esther Graves, a registered nurse who lost two cars to the water and now also has to give up her rental.

City officials say they are trying their best to resolve all cases, and say those that have not been settled are still open to negotiation.

Alex Barrios, a supervisor with the city’s private claims adjuster, Carl Warren & Co. of Orange, said the company follows standard industry procedures in handling each case. Adjusters determine the market value of cars, for example, through surveys of local automobile dealers.

“We’re obligated by claims-adjusting principles to pay market value,” Barrios said. But “we’re not going to be hard-nosed about it. We are going to use judgment when we can.”

Westminster City Council member Joy L. Neugebauer said the city is trying to be as fair as possible in dealing with residents, while at the same time being responsible with tax dollars.

“The policy the City Council set was to meet the immediate need, and try to resolve each issue fairly,” Neugebauer said.

And Deputy City Atty. Kimberly Hall-Barlow points out that city officials offered help even though the city has not yet been held legally responsible for the accident.

“They could’ve said, ‘Everybody file your claims, your lawsuit and we’re going to sit tight and see what happens,’ ” she said. “They haven’t done that.”

Barrios said his company has paid between $50,000 and $100,000 in claims already, drawing on a special bank account funded by the city.

The city continues to provide free housing for 25 families who were flooded out, City Manager Don Vestal said. About half of those are long-term cases whose homes were red-tagged for eventual demolition.

Some homeowners, while frustrated, say they believe the city is trying hard to help them.

“I do blame the city for [the rupture], but I do think they are trying to do right by us,” said Debbie Even, whose Hefley Street home was damaged.

Residents aren’t the only ones worrying about flood costs. The city itself has failed to get reimbursement from the state for flood-related expenses.

After meeting with Westminster officials, the state Office of Emergency Services this month denied the city’s request for a proclamation of a state of emergency because agency officials believe insurance will pay most of the costs, said office public information officer Jaime Arteaga.

Such a proclamation would bring state funds to pay for many of the costs of responding to a disaster, such as overtime pay and equipment purchases.

“The lack of the state disaster declaration is disappointing in that those response costs that may not be eligible for insurance coverage will not be reimbursable,” Vestal said. “At this point, it’s too early to assign a number to that.”