California Utility Stops Talks on Fund for Pipeline Blast Victims

By GARANCE BURKE | February 16, 2012

The city of San Bruno, Calif., said Wednesday that Pacific Gas & Electric Co. has broken off settlement talks with the city about a compensation fund for a deadly gas pipeline explosion.

Officials in the San Francisco suburb want the utility to make good on its promise to pay restitution for the September 2010 blast that killed eight people, destroyed 38 homes and laid waste to a quiet subdivision overlooking the San Francisco Bay.

City spokesman Sam Singer said San Bruno officials have been negotiating a confidential settlement with PG&E officials, including President Chris Johns, since last fall. But Singer said the utility abruptly walked away from the negotiating table last week.

“PG&E owes it to this community to pay restitution so it can build a library, a park, a memorial, and do something new to rebuild the spirit of this city that was devastated by this blast,” Singer said. “PG&E has walked away from the table, and we want them to negotiate in good faith.”

PG&E spokeswoman Dave Eisenhauer said the company hasn’t walked away from the talks.

“We’ve been working with the city and the community and have been there supporting the city since this terrible accident,” he said. “We’re as committed to the city and the community as we have been all along.”

He declined to provide details on the negotiations.

Any settlement would be in addition to a trust fund PG&E created to pay up to $70 million to help the city cover the cost of rebuilding.

Federal accident investigators lay the blame on PG&E for the explosion, saying a litany of failures led to the blast, which they concluded wasn’t the result of a simple mechanical failure but rather an “organizational accident.”

Escaping gas fed a pillar of flame 300 feet tall for more than 90 minutes before workers were able to manually close valves that cut off gas to the ruptured pipeline. Investigators said the damage would have been less severe had automatic valves been in place.

Dozens of people were injured and more than 100 homes destroyed or damaged in the bedroom community.

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