An audit of San Diego’s program to remove debris from homes destroyed in the October 2007 wildfires has found that the city was sometimes overbilled by private contractors and was unprepared to administer the program.

City Auditor Eduardo Luna’s report found that the billing by contractors Granite Construction Co. and A.J. Diani Construction Co. contained errors. The debris removal program cost about $9.7 million, of which the city is expected to pay $658,000. The state and federal governments, and homeowner insurance, is expected to pay the rest.

The audit, which followed an article in The San Diego Union-Tribune, found that A.J. Diani negotiated a contract amendment that led the city to pay the company nearly $200,000 more than the firm had to pay in disposal fees.

The firm also overbilled the city by $8,540 for more days of street sweeping than the firm actually conducted. The audit, however, also found that the firm may have under-billed the city for $38,000 to $105,000, though auditors could not verify that.

The audit found that 24 of Granite’s 1,371 weigh tickets were misread, miscalculated, incorrectly keyed or billed twice, resulting in an overcharge of $2,223. In addition, inconsistencies between the firm’s invoices and supporting documents called into question $64,922 in payments.

The report also cited shortcomings in the city’s administration of the program. For instance, the city staffers couldn’t confirm the accuracy of bills because they relied exclusively on contractor invoices. They also underestimated the amount of debris that would be removed, leading to higher-than-expected costs.

Environmental Services Director Chris Gonaver wrote in response that the department would incorporate lessons from last year’s wildfires into future plans. Gonaver also agreed to take many of the actions recommended by the auditor, such as sending invoices for the overbilled amounts to contractors.

The report also notes that the city-hired contractors had certain requirements that debris removal contractors hired directly by homeowners did not. That “may have contributed” to the city-hired contractors’ higher costs, the audit found.

Still unknown is what will happen to a lawsuit filed against the contractors by ex-City Attorney Mike Aguirre, who claimed the contractors owed the city more than $2 million. Gina Coburn, a spokeswoman for new City Attorney Jan Goldsmith, said attorneys are slated to discuss the matter with the City Council in closed session on Jan. 20 to “seek their direction” on the case.


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